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Butler sewer authority budgeting for potential sale

Butler Area Sewer Authority treatment plant

BUTLER TWP — The Butler Area Sewer Authority board of directors approved a budget for what could be its final fiscal year as an independent agency, as the pending sale of its assets to Pennsylvania American Water continues to be held up in court.

The Butler Area Sewer Authority board approved the 2024-25 budget on Tuesday, July 9, which is balanced without a rate increase and has projected expenditures totaling about $14 million.

At Tuesday’s meeting, the board shuffled $30,000 from BASA’s capital projects fund to miscellaneous consulting expenses to pay for public relations services relating to the authority’s sale to Pennsylvania American. The agency previously paid Ceisler Media & Issue Advocacy about $9,400 a month for services relating to the sale, and BASA board member Fred Vero said Tuesday that the company’s services will likely be needed once again within the year. The $30,000 was moved to cover three months of Ceisler Media expenses.

The board also accounted for higher legal fees in its budget, because an appeal by Center and Summit townships to stop the sale has delayed the sale’s closing date. Duane McKee, executive director of BASA, said at the previous meeting that the board increased projected expenses in that category as well.

Borrowing opportunities

With BASA preparing to take on a long-awaited Corrective Action Plan project with an estimated cost of $14 million, its board heard Tuesday from a financial adviser about borrowing options to fund the construction work.

According to McKee, improvements to the western service region — the area of Greenwood Drive and Benbrook and Bryson roads — have been in the works since 2019. Herbert, Rowland & Grubic is the engineering firm for the project, and McKee said the upgrades are related to pump stations in the affected areas.

Jay Wenger, a broker at RBC Capital Markets, told the board Tuesday that he was working under the assumption that the sale would eventually be approved when weighing finance options. Money gained from the sale of the authority to Pennsylvania American would net Butler and Butler Township a shared $230 million, some of which would be used to pay the authority’s remaining debts and liabilities.

The board asked Wenger to draft a request for proposals for financiers, with an aim to award the contract to an agency by Jan. 1.

“We do need to advertise and award the contracts in December, so we can get it under contract in January,” McKee said.

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