BELLEVILLE, IL (STL.News) Illinois American Water, a subsidiary of American Water (NYSE: AWK), signed an agreement Thursday, Dec. 19, 2019, to acquire the City of Jerseyville’s water and wastewater systems. The agreement for the sale of the systems, which each serve about 4,100 customer connections for a total of 8,200 customers, is for $43.25 million.
“Illinois American Water is proud of our over 140-year history of providing safe, reliable service to our customers. Our team of wastewater and water service experts are looking forward to serving our new customers and making critical improvements to ensure reliable service for public health,” said Bruce Hauk, Illinois American Water President. “Many communities are looking for new and innovative ways to deal with challenges they’re facing while controlling expenses. There’s nothing more important to our team than ensuring our customers receive the best service possible at a good value. These partnerships are a great solution for residents.”
Illinois American Water will seek approval of the acquisition from the Illinois Commerce Commission. The transaction is expected to close in late 2020, pending regulatory approval.
Approval for the pending transaction will be sought under the Illinois Systems Viability Act, which allows municipalities in Illinois to sell water and wastewater systems for a price based on fair market value. According to Hauk, “Prior law only allowed the investor-owned water or sewer utility to pay the original cost minus depreciation to acquire a system, public or private. Because of this, systems were previously deprived of receiving adequate value for their system.”
In 2019, Illinois American Water acquired the Alton Regional Wastewater System and the Village of Godfrey’s wastewater system, also located in Southern Illinois. The Village of Glasford’s water and wastewater systems, located in Central Illinois, were also acquired. These acquisitions added a total of 30,174 new Illinois American Water customer connections.