The Town of Milford closed on its acquisition of the Milford Water Company on December 3, 2021. The closing occurred after the approval of the acquisition of the assets of the Milford Water Company by Town Meeting on August 2, 2021 and through a subsequently negotiated Purchase and Sale Agreement executed by the Select Board on November 8, 2021.
The final purchase price was $77,174,201.60 (not including customary closing costs for title insurance, recording fees and certain credits for taxes and utilities). The acquisition was funded through a municipal bond offering at very favorable rates. The final negotiated purchase price consists of a 2018 valuation determination by the Department of Public Utilities, post-2018 capital asset additions, the Company’s accounts receivable and a transactional fee. The acquisition includes all the assets of the water company, including all of the real estate located in Milford and in Hopkinton, all water rights, easement rights or other rights in real estate of the MWC and all of its rights to sell water in accordance with the Company’s enabling legislation. The transaction is an asset purchase and, as such, excludes all Company liabilities with the exception of certain contracts and leases the Town acquired through the acquisition that have financial benefits.
The closing capped a decade long effort to acquire the Company’s assets pursuant to legislation passed in 1881. This included an initial feasibility study, years of due diligence, a successfully litigated valuation case before the Department of Public Utilities, multiple Town Meeting votes and countless hours by the Select Board and Town Staff including detailed analysis of the affordability of the acquisition and the impact on future rates.
“The acquisition of the Water Company provides a once in a lifetime opportunity to place control and responsibility of the delivery of this essential public service with the Town like a majority of the cities and towns across the Commonwealth” said Select Board Chairman Michael Walsh. “This control effectively allows our residents, through their elected officials, to be directly involved in ensuring the quality of our water as well as the future investment needed to maintain a safe and reliable system.”
Simultaneous with the transaction, the Town has been diligently working to set up its Water Department, headed by three Water Commissioners. Under 2017 legislation, also approved by Town meeting, the Commissioners are initially appointed by the Select Board, but will be subsequently elected beginning in 2022. The Town’s inaugural Water Commissioners are Jonathan M. Bruce, Phillip Ciaramicoli and Jamie Luchini. The Board of Water Commissioners will make decisions about operations, maintenance, capital improvements, as well as set the water rates, just as is done now for sewer rates by the Milford Board of Sewer Commissioners.
As part of the transaction, all of the current Milford Water Company employees will become employees of the Town, and the Town has negotiated a contract with David Condrey, the current manager of the Company, to continue in that role at the Water Department for the next three years. With experienced employees under Mr. Condrey’s management, the Commissioners expect a smooth transition to Town ownership.
“We are committed to administering the Water Department consistent with the goals of the transaction set by the Select Board – to provide high quality water, dependable service and predictable rates for water in the Town of Milford” said Water Commissioner Chair Bruce. “While a great deal of work went into this acquisition over many years, much remains to be done to ensure the Town’s water supply and service is improved under the Town’s ownership”.
The transaction was spearheaded by the Select Board with the assistance of Town Administrator Rick Villani, Town Treasurer, Chris Pilla, Director of Finance, Zach Taylor and former Town Counsel Gerry Moody, who began this process over a decade ago. The Town was represented by outside counsel Jed Nosal and Sarah Wilk of the Law Firm of Womble Bond Dickinson in Boston.