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Contact: Tom Mayo, Interim Town Administrator
Hingham to Apply for Further Appellate Review
HINGHAM, MA. (November 21, 2017) – The Town of Hingham will be filing an application with the Massachusetts Supreme Judicial Court, requesting further appellate review to determine the purchase price for the Hingham Water System.
“As members of the Board of Selectmen, we have a responsibility to both current and future generations of Hingham residents,” said Mary Power, Chair of the Board. “We are of the unanimous opinion to finish what the Town started by seeking a ruling from the State’s highest court.”
In 2012, Hingham had the 5th highest water rate among the 351 municipalities in Massachusetts, and was one of only a small number of communities with a privately owned water company. Aquarion’s public DEP filings showed the company had an expectation of double-digit rate increases every few years, and unaccounted for water was 16%, six points higher than the DEP standard.
Based upon citizen concern that the public interest was not being adequately served, the 2012 Annual Town Meeting authorized funding to study the feasibility of a Town purchase, a right granted under an 1879 statute.
The Town undertook a comprehensive financial analysis, which concluded that over half of Aquarion’s costs could be eliminated under Town ownership. The analysis further concluded that this cost savings difference would be more than sufficient to fund the purchase of the system, significantly increase annual capital spending, and repay all expenses incurred by the Town since it began considering a purchase.
“Ratepayers pay for all necessary capital improvements to the water system regardless of who owns the water company,” said Selectmen Paul Healey. “Given that our water rates are one of the highest in the Commonwealth, we remain concerned about the number and frequency of water main breaks, service interruptions, reports of discolored water, and amount of unaccounted for water, which now stands at 18%. To put that number in perspective, it translates to over 200 million gallons of water per year, which represents approximately 40% of the storage capacity of the Accord Pond reservoir.”
In July of 2013, Hingham filed a lawsuit requesting a court determination of the price for the water system. The 2014 Annual Town Meeting authorized additional funding for litigation. A trial took place in the Suffolk County Business Litigation Session during 2015. The 2016 Annual Town Meeting authorized funding for any potential appeal.
In April 2016, the Trial Court set a purchase price of $88 million as of December 31, 2013. Both Hingham and Aquarion appealed the court’s ruling. The Massachusetts Appeals Court, the state’s intermediate appellate court, affirmed the lower court’s decision earlier this month.
“Since the Superior Court ruling, we have been carefully evaluating our options, understanding that our decision will affect Hingham for a very long time,” said Selectmen Karen Johnson. “In weighing the alternatives, we reviewed similar cases involving municipalities seeking a price for their water systems. We found that issues of this magnitude that are subject to interpretation have usually been decided by the Supreme Judicial Court.”
“The responsible next step for the Board of Selectmen is to request Supreme Judicial Court review of the interpretation of the formula used to determine the purchase price,” said Mary Power. “The Town will then have certainty about the price it must pay if it wishes to bring a precious resource under public control for the benefit of future generations of its Townspeople.”