For the publisher:
No one doubts that Housatonic Water Works wants to be able to provide the residents of Housatonic with the clean water they deserve. The obstacle – the reason for all the sediment – is that HWW does not have the $ 31 million that a recent report determined is needed to overhaul its system. HWW sits between a lot of rocks and a rough spot – the DPU won’t allow a rate hike on HWW’s 850 customers large enough to pay for repairs, but loan markets won’t lend without hefty rate hikes. At this point, HWW must remove a page from the Flint, Michigan, and PG&E bankruptcy manuals to settle through the bankruptcy court what it cannot do outside of it.
Flint, which supplies water, and PG&E, which supplies electricity and gas, both filed for receivership when the costs of repairing their utility systems greatly exceeded their based ability to pay. on tariffs. Because a bankruptcy court order replaces a DPU rate order, a bankruptcy court judge can empower a trustee to guide and borrow HWW out of this mess. An insolvent HWW cannot borrow the funds needed to fix the system, but a trustee can borrow long term (at current low rates) to fix problems now.
HWW’s liabilities exceed its assets by approximately $ 25.2 million. This checks the first bankruptcy box. If HWW does not voluntarily pursue bankruptcy, Great Barrington and HWW’s other creditors together may cause HWW to involuntarily file for bankruptcy. This is the second box. The last box is the willingness to sue in bankruptcy court. The residents of Selectboard and Housatonic must either convince HWW to file for bankruptcy or the creditors of HWW as well as the residents of Selectboard and Housatonic will have to make the decision for them. The question is no longer whether HWW is bankrupt. It’s just a matter of when HWW, or Great Barrington, recognizes the fact and uses it for the benefit of the residents of Housatonic.
Peter J. Most
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