Hartford Business Journal

www.HartfordBusiness.com • May 7, 2018 • Hartford Business Journal 15 NEOPERL, Inc., 171 Mattatuck Heights Rd, Waterbury, CT 06705 | 10,000 sq. ft. Quality Renovations by Borghesi Building 2155 East Main Street • Torrington, Connecticut 06790 www.borghesibuilding.com © 2011 BlueScope Buildings North America, Inc. All rights reserved. Butler Manufacturing™ is a division of BlueScope Buildings North America, Inc. Contact us at 860-482-7613 or visit us on the web. WE PROVIDE CT BUSINESS LEADERS WITH THE INFORMATION THEY NEED TO SUCCESSFULLY RUN THEIR BUSINESS. ARE YOU IN THE KNOW? SUBSCRIBE BY GOING TO WWW.HARTFORDBUSINESS.COM CLICK ON "SUBSCRIBE" will average $114 million a year from 2018 through 2022. By comparison, Aquarion pre-merger invested an aver- age of $68 million annually in its water works. Moreover, Eversource says its deal would "keep ownership of a Connect- icut company in Connecticut.'' "We have prov- en to customers, communities and regulators that we are a trusted operator of water utilities through our ownership of Aquarion,'' Ever- source spokes- person Caroline Pretyman said in an email. SJW Group said its acquisi- tion proposal provides better value to Connecticut Water Service shareholders: its deal is valued at $63.70 per share (or a bit higher) vs. Eversource's $63.50 per share offer. It also took a shot at Eversource's recent financial performance and customer service ratings, pointing out the Connecticut Public Utili- ties Regulatory Authority recently launched an investigation into a spike in Eversource energy custom- ers being cut off from service. "Eversource Energy is predomi- nantly an electric and gas transmis- sion and distribution company that is launching an unsolic- ited acquisition proposal and disruptive, costly proxy contest in an effort to distract from its record of chronic underperfor- mance and poor customer ser- vice," SJW said in a statement. San Jose Water, an SJW Group subsidiary, and Connecticut Water are about the same size and share reputa- tions among their peers as efficient operators, with lean staffs, the companies said. A combination, they say, would create a water utility whose scale would allow it access to cheaper capital with which to increase investment in CWS' infra- structure in Connecticut and Maine. Connecticut Water asserts the SJW deal is in the best interests of its cus- tomers and stockholders. The proposed merger still needs approval from stockholders of both companies and regulators, including the state Public Utilities Regulatory Authority, which declined to comment on the deal. Emotions run high Ownership and use of Connecticut water is an emotional topic for many, said state Office of Consumer Coun- sel (OCC) Elin Swanson Katz, whose authority to protect them extends to investor-owned utilities like Connecti- cut Water and Eversource. "Water, next to cable, is probably the hot-button issue for most people,'' said Richard Sobo- lewski, a super- visor of utility financial analysis at OCC who has had a hand in scores of utility- rate proceed- ings. That was apparent two years ago, amid Bloomfield residents' uproar over Niagara Bottling's intent to build, using town tax incentives, a plant bottling daily up to 1.8 million gallons of water to be purchased at a discount from quasi-public regional water-sewer util- ity, The Metropolitan District (MDC). MDC serves more than a dozen Greater Hartford communities. Ultimately, Niagara opened its plant, but consumers' outrage prompted MDC to revoke its water discount. It also triggered a failed ef- fort in the state legislature to extend a regulatory hand into future sales of water by MDC or other providers. MDC and in- dustry-affiliated lobbies opposed the measure as too intrusive. MDC, by state statute, is barred from being sold to, or merging with, any public or private water- sewer utility, ac- cording to MDC Assistant District Counsel Christo- pher Stone. The Niagara episode left "a really poor taste in everybody's mouth,'' said Valerie Rossetti, a retired anes- thesiologist who is a member of Bloomfield Citizens and on the steering committee of its 2,800-member statewide offshoot, Save Our Water Connecticut. Both groups, Rossetti said, find "alarming" the prospect of out-of- state ownership, someday perhaps even foreign control, of a large chunk of Connecticut's water resources. "There is an inherent conflict of interest," she said, "having out-of- state or international corporations making decisions about public-water resources.'' CT Water Service Customer Base Clinton-based Connecticut Water Service Inc. and its various subsidiaries provide water and wastewater service in Connecticut and Maine. Here's a breakdown of its total customer base as of Dec. 31, 2017. Residential: 118,493 Commercial: 9,386 Industrial: 536 Public Authority: 1,072 Fire Protection: 3,178 Other (including non-metered accounts): 2,980 Total: 135,645 Source: Connecticut Water Service Inc. Connecticut Water's suitor promises better technology, more investment.

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