Somerville, New Jersey American Water closing in on sewer system sale
SOMERVILLE – The borough and New Jersey American Water are getting closer to finalizing the sale of Somerville’s aging sewer system to the utility for $7 million.
The agreement is part of the process leading to the closing of the sale in the second half of the year, pending approval by the New Jersey Board of Public Utilities.
The Somerville Borough Council will introduce an ordinance on Feb. 21 to give formal consent to New Jersey American Water to provide the sewer service. The ordinance will be up for public hearing and final adoption on March 6.
“I want to thank the elected officials and residents of Somerville for entrusting us to manage and improve their sewer utility and help protect the town and the environment from the many risks associated with running a sewer collection system,” Mark McDonough, president of New Jersey American Water, said in a press release. “Providing water and wastewater service is all we do, and as Somerville’s longtime water company, we are deeply committed to making the needed improvements to provide the community with sewer service that is as safe, reliable and affordable as the water service we provide.”
The sale of the sewer system, with some pipes a century old, was approved in November by borough voters. The referendum passed by a 3-1 margin.
The sewer system has about 3,800 customers.
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New Jersey American Water will invest a minimum of $9.5 million in improvements in the decade after the acquisition becomes official.
The utility also said it will not raise sewer rates for two years following the completion of the sale. After that, the utility will increase rates no more than 3% per year for the next three years, and then no more than 4% for the following two years.
“New Jersey American Water has the expertise, equipment, manpower, and financial capability needed to maintain and improve this important part of our town’s aging infrastructure,” said Somerville Mayor Dennis Sullivan. “With private ownership of the system, the borough will eliminate the need for significant rate increases going forward and borrowing money for future improvements will end. Somerville will then be able to fund other needed projects, the sewer system will be maintained and improved on a consistent basis, and sewer rates will remain stable.”
The sale of the system to New Jersey American Water will be similar in many ways to Bound Brook's sale.
By a 63%-to-37% margin, Bound Brook voters in November 2021 approved the $5 million sale of its sewer system to New Jersey American Water.
Email: mdeak@mycentraljersey.com
Mike Deak is a reporter for mycentraljersey.com. To get unlimited access to his articles on Somerset and Hunterdon counties, please subscribe or activate your digital account.
This article originally appeared on MyCentralJersey.com: Somerville, NJ American Water closing in on sewer system sale
