Murky Waters Of Eminent Domain
By Patrick Cronin
Hampton Union, Sunday, February 20, 2005
[The following article is courtesy of the Hampton Union and Seacoast Online.]
HAMPTON -- Aquarion Water Co. says if Hampton tries to take over the company, it will fight the town every step of the way.
Hampton is considering looking into joining other municipalities that have already begun the battle of taking control over water systems owned by private companies.
A warrant article will go before voters on March 8, spearheaded by selectmen Chairman William "Skip" Sullivan, asking residents if they are interested in studying taking over Aquarion Water's assets in Hampton.
Aquarion Water Senior Vice President Larry Bingaman said if Hampton wants to take the company by eminent domain, it should study what's going on in Nashua to see what the town could be getting itself into.
He also added the town can't just take over its assets in Hampton. If the town is going to do so, it would have to take over the company's entire system, which services North Hampton and some of Rye.
Nashua and a $1M later
In Nashua, the City Council there is in the process of trying to take ownership of Pennichuck Water Co.
The company has refused to sell it, and city officials are now being forced to take it by eminent domain, which is the government's power to seize private property for public purposes as long as it pays the fair-market value.
Nashua decided to try and take over the company after a foreign company, Aqua America, tried to acquire it in 2002.The battle between the city of Nashua and Pennichuck Water Co. has been ongoing for two years. Officials have already spent more than a million dollars on legal and consultant fees, and so far the city has nothing to show for it.
Bingaman said if Hampton tries to take over Aquarion Water, it will be just as costly to the taxpayers here as it has been to taxpayers in Nashua.
He estimates the company is valued at more than $70 million. That figure doesn't include what it would cost to start the process of taking it over by eminent domain or what it would cost to run the water company.
That's why the company has adopted the saying, "Why fix something that isn't broke?"
Aquarion Water officials are still scratching their heads on why the town has submitted the article. But they are taking the threat seriously.
Private vs. public
Aquarion Water purchased the company from Hampton Water Works and the company has always been privately owned.
Sullivan, the one selectman to press for the article, said, "I just want to throw the question out to the public.
"This is not (an) article to buy the company," Sullivan said. "This an article to study if it's feasible to do so. If the people in this town are not interested, then neither am I."
Bingaman said he believes there is more to it than that, and he's tried on several occasions to meet with Sullivan - to no avail.
He said he suspects it may have something to do with the company's high turnover in management last year, and complaints from consumers about its not having a call center in Hampton.
All issues that have been addressed, Bingaman said.
Bingaman said the only other issue may be that the company charges the town a fee for every fire hydrant in town.
Three of the five selectmen have already gone on record as saying they have no interest in trying to acquire Aquarion Water.
"It's ridiculous," Selectman Ginny Bridle-Russell said. "We have enough to worry about. We should not even consider buying Aquarion. That is my honest opinion."
"I don't really have anything to say about it, to be truthful," Selectman Rick Griffin said. "I think it's a long shot and that it's not really practical at this time."
Shawn Bradford, director of operations at Aquarion Water, said Hampton would have to get the support of North Hampton and Rye because the town doesn't have the capacity to service itself.
While Aquarion Water owns 16 wells, only four are within the town of Hampton.
That would force Hampton to enter an agreement with North Hampton and Rye to take over the water system.
Rye Selectman John Moynahan said that board has not had contact with Hampton. He added there is no interest in Rye to see Hampton take it over.
Sullivan said Aquarion Water is using scare tactics.
"I think they are trying to scare people into not looking at it," Sullivan said. "I think it would be worthwhile."
Bradford said the company is not using "scare tactics," but admitted Hampton could just service itself if it wants to spend the money to redirect the system and construct more wells.
"Anything is possible, but it does come at a cost," Bradford said.
Sullivan said one of the main advantages of the town owning the water company is that it would be able to set its own rates.
Bingaman said the main problem he has with the article is that there is no money attached to it.
"How can you study something if there is no money to provide expert testimony?" he asked. "What kind of study is it going to be?"
Town Manager James Barrington said the study, of course, would cost money, and that would be determined at a later date.
Sullivan said whatever the voters decide on March 8, he will support it.