04/12/2005

PWSB planning to purchase Central Falls' water system

David Casey

CENTRAL FALLS -- After years of litigation, haggling and deal-making, it looks like the City of Central Falls will finally be able to sell its water system to the Pawtucket Water Supply Board.

According to a communiqué from PWSB attorney Joseph Keough, the latest draft of the board's rate-hike proposal included the cost of purchasing the system from the city, said City Solicitor John Gannon.

"The city had a standing offer with two payment options," said Gannon. "Pay in full in 2005 ($1 million) or $1.2 million over the course of two years (2006-2007). It appears that they intend to exercise the second option."

The controversy over Central Falls' water system and ownership dates back to the city's original contract with the PSWB in 1938.

According to the terms of that contract, Central Falls retained ownership of its pipes when PSWB built its current pumping facility, and PSWB agreed to pay an annual franchise fee -- 25 percent of gross water sales -- to use the pipes.

But when those franchise fees skipped a couple of years, during the administration of then Mayor Lee Matthews, the city sued.

The two parties eventually settled out of court, but when the franchise agreement expired in 2002 and PSWB attempted to purchase the pipes in order to reunify the system, purchase negotiations quickly stalled.

The city, Keough said at the time, was asking too much for a system that required no less than $10 million in repairs and upgrades. Councilman Jason Leger and newly-elected Mayor Charles Moreau argued Matthews' administration had unwisely chosen to spend its franchise fee proceeds on costly litigation rather than reinvesting in its aging water pipes.

When PSWB assumes ownership of the pipes, it will assume all necessary repairs, according to Keough.

"It's what we expected and it's a good thing for the city," Council President Robert Weber said of the PSWB's apparent decision to purchase the system. "We had two offers on the table and they chose the higher of the two. I'm happy with that result."