PUC Releases Report on Valuation for Act 12 Water, Wastewater System Sales 

The Pennsylvania Public Utility Commission released a report that provides additional reference for use in Section 1329 fair market valuation of publicly owned water or wastewater systems being sold to public utilities until Act 12 of 2016.  

The publication of a reasonableness review ratio is intended to be used as a guidepost for the Commission when it analyzes and determines the pruency of applications for systems sales under Act 12. The ratio is based on data from investor-owned utilities and is compared against the ratio of the depreciated original cost valuation and the resulting rate base addition of the proposed Act 12 selling price. Based on a resolution adopted by members in 2022, PSATS supports the sale of these systems based on book value vs. the current fair market value process.  

This publication supplements the rulemaking the Commission recently made to ensure increased public involvement and greater consistency in the review and evaluation of sale prices of municipal or authority-owned waster and wastewater systems. Click here for the press release and here for the report.