KINGWOOD — The Preston County Commission is being asked to approve the expansion of Public Service District 4’s service area so it can merge with the Town of Bruceton Mills’ water system.
The commission will consider the request when it meets at 9 a.m. Tuesday. Meetings are still closed to the public but are live-streamed on Facebook on the commission’s page, “Preston County Commission WV.” Videos of the meetings remain on the page and can be viewed later.
PSD 4 has about 200 customers, according to James Kelsh of Bowles Rice LLP, the law firm handling the merger. Bruceton has about 73, according to the draft order provided to the county commission.
Bruceton buys its water from PSD 4.
The town and PSD have approved an agreement to transfer Bruceton’s system to the PSD, Kelsh said. However, the PSD’s service area must be extended in order for the deal to go through.
“We are going to the county commission and asking them to amend the service territory authorization for PSD 4 to include the town of Bruceton,” Kelsh said.
The commission will have first reading of the request Tuesday. If it is approved, second reading will be Aug. 18.
The State Public Service Commission (PSC), which oversees utilities, will be notified after the first reading, so it can be a party to the petition, if it desires.
A public hearing is required as part of the process, but the Preston County Commission’s meetings have been closed to the public since March. Kelsh said he believes the commission will advertise the hearing and provide call-in information for the public to participate.
If the commission approves the territory modification, the water systems expect to file two cases with the PSC: One to request the change in territory for PSD 4 to include Bruceton Mills and the second a joint case by Bruceton and PSD 4 asking for approval of the sale of the Bruceton system to PSD 4.
If the acquisition is approved, Bruceton’s customers could see their minimum monthly residential rate go up $4.80.
According to information on the Public Service Commission’s web page, Bruceton last had a rate increase in April 2012. It’s current minimum monthly bill for residential customers is $21.
PSD 4’s last rate increase was in March and its minimum monthly bill for residential customers is $25.80, according to the Public Service Commission.
Kelsh said PSD 4 does not believe Bruceton has enough cash reserves to cover depreciation or a working capital reserve account. Both are now required by law.
“Right now the rates at Bruceton are lower than PSD 4’s. We’re going to ask the [public service] commission if they approve the transaction, to also approve switching Bruceton Mills customers’ rates to PSD 4’s rates,” Kelsh said.
PSD 4 will not pay anything to acquire Bruceton and its assets. Bruceton has about $50,000 cash on hand that will be given to PSD 4 at closing, Kelsh said. The town has no outstanding bonds.
“I think the town’s done a good job with the system,” but it’s hard to operate a system with such a small number of customers, Kelsh said.
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