State still mulling Pennichuck case

CONCORD – Attorneys for the city of Nashua said Pennichuck Corp. has been for sale for years and that Pennichuck’s current CEO was hired to sell the company, while Pennichuck attorneys accused the city of trying to “hold the company hostage” and force it to sell at an unfair price.

The state Public Utilities Commission heard from a dozen attorneys, various town and business representatives, and several citizens Thursday at a two-hour conference on the eminent domain case between the city and Pennichuck.

The PUC did not make any decisions Thursday.

The hearing came a day after the PUC issued an opinion stating that the city cannot seize Pennichuck’s subsidiaries that lie outside city borders. The PUC has not issued a final order on the matter, however.

Robert Upton, the attorney representing Nashua, said the city does not intend to appeal the PUC decision.

Pennichuck attorney Steve Camerino said he plans to file a motion for summary judgment by Jan. 3, asking the PUC to limit the Pennichuck property that Nashua would be able to pursue taking. That would officially take the Pennichuck subsidiaries except for Pennichuck Water Works off the table.

Nashua had wanted to take Pennichuck Water Works and two other subsidiaries of Pennichuck Corp. – Pennichuck East Utility and Pittsfield Aqueduct Co. – by eminent domain.

At Thursday’s hearing, attorneys for various towns stated their interests in the case.

Amherst was the only town that said Thursday that it sides with Nashua in the case. Representatives of other towns, including Bedford, Litchfield and Pittsfield, said they have to think things through based on Wednesday’s PUC decision.

The state’s Office of Consumer Advocate, PUC staff, and Anheuser-Busch, in addition to the towns of Milford, Merrimack and Hudson, said they have not taken a position.

Upton, Nashua’s attorney, said it is in the public interest for the commission to allow Nashua to acquire Pennichuck Water Works. The city’s analysis shows that rate increases with municipal control would be half of what they would be under Pennichuck, Upton said, adding that Nashua is the only city in New Hampshire that does not own its own water system.

Upton said that while Pennichuck may have been a well-run company in the past, “we also don’t know how this company will be run in the future. The company has been very clear it’s for sale.”

Camerino said the city hasn’t provided any specific plan on how it would operate the water system.

“Nashua will operate the system for its own benefit,” Camerino said, adding that the city’s case is “superficial,” “insufficient,” “filled with misstatements” and “based on generalities.”

“We think Nashua’s strategy is to hold the company hostage and force it to agree to a value that’s less than fair,” Camerino said.

Upton claimed that Pennichuck CEO Don Correll was hired to sell the company, and that Pennichuck will not be the same company if Nashua does not buy it.

Claire McHugh of Nashua, who represented herself as a citizen, said Nashua residents want to control their water supply.

“Pennichuck has already said it’s for sale. It’s just going to be a question of who should purchase it,” McHugh said. “We don’t want to be controlled by a foreign corporation.”

Barbara Pressly of Nashua, who started a committee to help build support for last year’s referendum for the public acquisition of Pennichuck, said the company has “secretly sought corporate offers.”

“We’ve known for the past 20 years that Pennichuck has been positioning themselves to be bought,” Pressly said.

Pressly then asked the commission to order Pennichuck to stop its newspaper and television advertising campaign. She said the ratepayers are shouldering the cost.

Pennichuck attorney Camerino later expressed disappointment with some of Thursday’s testimony.

“There were a lot of facts that were thrown in, particularly by Ms. Pressly, that are simply not true,” Camerino said. “The company now has no opportunity in a public domain to respond to those probably until a hearing on the merits.”

Nashua resident Fred Teeboom said the city has not made its case for a public taking of Pennichuck, nor has the city demonstrated it could do a better job running the water system.

“I’ve never heard anybody say the water tastes bad,” Teeboom said. “So why this taking?”

Teeboom said the city referendum vote was premature, and did not say that voting “yes” mandated buying Pennichuck. It simply said the city could pursue the acquisition.

“If Nashua takes this over, there’s no more PUC oversight,” Teeboom said. “I’m worried about not having PUC oversight, seeing how the city of Nashua conducts its business.”

Attorney Edmund Boutin, representing Merrimack, said the town is not endorsing either side, but expressed skepticism about Nashua’s ability to run the water system.

Boutin called Pennichuck a well-managed utility, and said Merrimack is pleased with the company. Merrimack has a larger interest than other towns because Anheuser-Busch consumes about 15 percent of Pennichuck’s average daily flow.

Following the session, the parties discussed a procedural schedule and dates that testimony would be due. The parties agreed on Jan. 3 for Pennichuck to file its motion for summary judgment, and a rebuttal by Feb. 4. The parties would then hold another technical session to set further dates.