By: Asa Fitch
that their water company might be wrested from local control by a
multinational corporation in the near future, leading to the sale
of unblemished watershed land for residential development and an
increase in water rates, a group has formed to explore the
possibility of buying the private Torrington Water Company and
turning it into a publicly-held regional water authority.
The Litchfield Hills Council of Elected
Officials-a regional agency composed of leaders from Barkhamsted,
Colebrook, Goshen, Hartland, Harwinton, Litchfield, Morris, New
Hartford, Norfolk, Torrington and Winsted-appointed a subcommittee
at a recent meeting to explore the regional water authority
Tom Scoville, a former Torrington city councilman who owns
Scoville Plumbing and Heating in Torrington, is to serve as
chairman of the subcommittee.
"There are three fears," he said. "Number one, when
this multinational corporation comes in, we would lose local
control. Number two, there's a large amount of [open] land through
Goshen, Norfolk and Torrington that could be sold by this
multinational corporation for development, putting a great burden
on towns, especially if it's residential development. Number
three, the rates would go up. The ratepayers would pay more. Those
are our three major concerns."
The privately-held Torrington Water Company, established in 1873,
supplies drinking water from its 5,400-acre watershed in
Torrington, Goshen and Norfolk to residents of Torrington,
Litchfield, New Hartford and Harwinton. Approximately two thirds
of the watershed is currently preserved as open space. About 9,000
households use the company's services, and the company has roughly
State Sen. Andrew Roraback (R-Goshen), who is one of those
shareholders, said there was a growing trend in the state and the
nation in which large foreign companies are buying small local
water companies, an eventuality the establishment of a public
regional water authority would avert.
"There is a growing trend in America generally and in
Connecticut specifically of small locally-owned water companies
being acquired by large multinational corporations, specifically a
British company called Kelda, and another company called Suez,
which owns United Water in New Milford," said Mr. Roraback,
who, despite his status as a shareholder, has been cleared by the
state's ethics commission to collect and disseminate information
about the proposed water authority.
"Kelda is the biggest water company in Connecticut," Mr.
Roraback said. "All over the world, big multinationals are
buying small local utilities. [When that happens], you lose local
control over the land and the water, and instead of having
decisions made locally about these resources, they are made by
owners in foreign countries."
But the process leading up to a possible transformation will not
be an easy one, and it is likely to take a year or more even if it
clears all the obstacles in its way.
It is not an unprecedented idea, however. Proponents of a water
authority often cite what happened in New Haven in the 1970s as a
model for what might happen with the Torrington Water Company. The
New Haven Water Company was dissolved and a public entity called
the South Central Connecticut Regional Water Authority was set up
in its place.
According to Mr. Roraback, the transformation of the Torrington
Water Company from private to public might follow New Haven's
lead, and the conversion could work as follows. First, the
legislature could vote to establish a regional water authority
that has the power to incur debt. Next, the new water authority
could borrow enough money to buy the Torrington Water Company. And
then, with the approval of the company's shareholders, the water
authority could make the purchase. Finally, the new authority
could pay off the debt incurred in the purchase through money made
from the services it provides.
In the long run, Mr. Roraback said, such a scheme would preserve
large tracts of land the company owns and keep the company in
local control. It would also save money for water company
ratepayers, he said. Because a public water authority would not
have to realize profits for its shareholders, and because the
authority would be exempt from state and federal income taxes
because of its status as a nonprofit entity, the company would
save money. Those savings could be passed on to consumers.
Dick Calhoun, the president of the Torrington Water Company, said
he was receptive to the idea of a regional authority because he,
too, understood the deleterious impact a takeover by a
multinational company could have.
"I am concerned that there is a potential for a foreign
interest to acquire our company, as has happened elsewhere,"
he said. "In my mind, [a water authority] would be better
[than a multinational corporation]."
He said he would cooperate with the subcommittee investigating the
water authority option. But he cautioned that the final decision
on the sale of the company is up to the shareholders.
"Ultimately the question will be decided by
shareholders," he said. "It would come to a shareholder
vote. That is the ultimate determinant."
According to Mr. Scoville, because of its merits, the water
authority proposal already has a broad base of supporters,
including business leaders, environmentalists, local government
officials and state General Assembly members. But he qualified
that, saying his subcommittee is approaching the prospect of a
water authority with an open mind.
"I think our preliminary discussions, just looking at some
numbers, show that it is favorable to happen, that things have
moved along positively and certainly ahead of any schedule that we
have thought of," Mr. Scoville said. "So, as it moves
forward we are very positive, but at the same time we need to keep
our objectivity and look at all aspects of the situation."
He said he expected that, given enough support, a regional water
authority could form before the end of the year. In any case,
however, he said coming to a final verdict on the idea shouldn't
take more than a year or so.