By Alex Malm
At the Nov. 1 Londonderry Town Council meeting the Council heard from Assistant Town Solicitor Mike Malaguti regarding a proposed settlement in the Pennichuck Rate Case.
It was explained by Malaguti that about a year ago the Town was notified that Pennichuck which is one of the Town’s water utility companies that they were seeking a 21% total increase in revenue and was going to file it with the Public Utility Commission.
The Town Council then approved the hiring of an attorney to represent them in the PUC case.
After reviewing materials, going through the discovery process and hiring an expert witness to review materials they were then offered a settlement offer which would be a 16.5% increase.
Malaguti said on Oct. 18 the Town Council along with the different attorneys involved and the expert witness all met during a non-public meeting and recommended to the Town Council that they accept the settlement offer.
He explained that after the expert witness reviewed the different materials they determined that the increases are mostly justified under law. He noted that as a regulated utility they have the right to recover increases from the ratepayers. If they were to go to trial Malaguti said that they would likely have to pay more than 16%.
It was also pointed out by Malaguti that the Department of Consumer Affairs and the Department of Energy have also said that they are in favor of the settlement.
Malaguti said that while he knows that a 16 percent increase is a “bitter pill to swallow,” he thinks that it would be in their best interest to accept the settlement.
Town Councilor Deb Paul said that while she thinks they should accept the offer based on the information presented to them she hopes that they take more steps forward to leverage themselves with the company and keep an eye on what they are doing.
Town Councilor Tom Dolan said that he didn’t understand how the increase was justifiable.
“I still can’t come to grips with it being justified,” he said.
Town Council Chairman John Farrell said that while it’s tough to take the settlement offer he said that they would have to spend thousands of dollars on attorney fees and will likely be unsuccessful if they go to trial based on the advice they have received.
He also said that they need to speak with the leadership for the company.
“We need to have another conversation with their leadership team,” Farrell said.
They are going to invite the company’s leadership to a future Council meeting.
The Town Council begrudgingly voted in favor of the settlement.