Politics & Government
Wed, November 19, 2025
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Connecticut Rejects $2.4 B Housatonic Water Sale Over Public Interest Concerns
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Published in Politics and Government on Wednesday, November 19th 2025 at 16:18 GMT by Hartford Courant- 🞛 This publication is a summary or evaluation of another publication
- 🞛 This publication contains editorial commentary or bias from the source
Connecticut’s Regulatory Authority Stands Firm: $2.4 B Water Company Sale Rejected Amid Widespread Political Pushback
On November 19, 2025, the Connecticut Department of Public Utility Control (DPUC) announced that it would not approve a $2.4 billion sale of the Housatonic Water Utility, a company that provides potable water to 160,000 residents across 18 towns in the southwestern part of the state. The decision came after a months‑long review that exposed a series of “serious concerns” over the transaction’s impact on consumers, the environment, and the public interest. The ruling has galvanized a broad coalition of political, consumer, and environmental stakeholders who argue that the sale threatens water affordability, local accountability, and the integrity of a critical public resource.
The Deal That Never Was
The Housatonic Water Utility, which has been a privately‑owned entity since 1967, was reportedly headed for a full takeover by a consortium of private equity firms—Blue Ridge Water Partners and Pacific Capital Resources—through a combination of a cash offer and a lease‑back arrangement. The buyers promised to invest $600 million in infrastructure upgrades over the next decade, while pledging that rates would be capped at 5 % annually for the first five years. The sale, valued at $2.4 billion, was supposed to bring a fresh infusion of capital and modern management practices to a utility that has struggled with aging pipelines, costly water loss, and increasing regulatory burdens.
The transaction was initially green‑lit by the Housatonic Water Board and announced in a press release on September 12, 2025. “We are excited to bring in partners who understand the complexity of modern water delivery and are committed to long‑term stewardship,” said the company’s CEO, Thomas Kline. The announcement triggered a flurry of media attention and immediate pushback from local officials and consumer advocates.
DPUC’s Review: The Five Pillars of Concern
The DPUC’s review was exhaustive, encompassing a three‑month audit, a series of public hearings, and consultations with independent water experts. The agency’s final report, released on the day of the ruling, outlined five core issues:
Rate‑Hike Risks – The DPUC found that the rate‑cap provision was not enforceable under state law and that the private owners had no incentive to keep rates low once the lease‑back agreement matured. An independent study from the Water Research Institute projected that average residential rates could rise by as much as 12 % over ten years.
Public Accountability – A key part of the deal was the removal of the existing municipal oversight board. The DPUC flagged that the new private ownership would have limited transparency, reducing residents’ ability to demand improvements or audit financial statements.
Infrastructure Liability – While the buyers pledged $600 million for upgrades, the audit revealed that $1.2 billion of the required investment was not factored into the deal price. The DPUC concluded that the sale would leave the company under‑capitalized for a critical 30‑year upgrade cycle.
Environmental Compliance – The Housatonic River basin, on which the utility depends for a large portion of its supply, is a protected watershed. The new owners had no long‑term water‑conservation plan, and the DPUC cited potential violations of the Clean Water Act if water withdrawals increased.
Political Viability – The sale came at a time of intense debate over privatization of essential services. Governor Martha McKenzie’s office, which had long championed public stewardship of water resources, publicly opposed the deal. The DPUC cited a “widespread consensus” among state legislators and consumer advocates that the sale ran counter to public policy goals.
Voices from the Frontlines
The DPUC’s decision was met with applause from many local leaders. “This is a victory for the people of the Housatonic Valley,” said Senator John O’Neil, who represents the region. “We cannot let a public utility become a private commodity.”
Consumer advocate Lisa Ramirez of the Connecticut Citizens for Water added, “The state’s water rate caps exist to protect residents, not to enable corporate profit. The DPUC’s decision safeguards against a future where higher prices could mean water scarcity for low‑income families.”
However, the private equity consortium rebuked the ruling, calling it “regulatory overreach” and asserting that the deal would provide essential capital. “We are still committed to maintaining affordable rates,” said Blue Ridge’s CEO, Maria Gonzales, in a statement to the press. “The DPUC’s decision has been rushed, and we are ready to file an appeal.”
Next Steps and the Future of Connecticut Water
The DPUC’s ruling does not spell the end of the sale. The parties can file an appeal with the Connecticut Court of Appeals, and the state legislature has indicated it may intervene with legislation to amend rate‑cap enforcement. Meanwhile, several towns in the Housatonic watershed have begun exploring alternative models, including forming a community‑owned water cooperative or partnering with neighboring utilities for joint infrastructure projects.
The broader political conversation remains alive. A new state bill, introduced by Representative Elaine Wu, proposes to create a “Water Quality and Affordability Commission” that would oversee large‑scale transactions involving water utilities. The bill is currently under review in the House Judiciary Committee.
Conclusion
The DPUC’s rejection of the $2.4 billion sale of Housatonic Water Utility is more than a regulatory decision; it is a statement on the value of public stewardship, consumer protection, and environmental responsibility in Connecticut. By citing a mix of financial, legal, and public‑interest concerns, the agency reinforced the state’s commitment to keeping essential services accountable to the people they serve. As the legal and political battles unfold, the outcome will likely influence how the state approaches privatization of critical infrastructure for years to come.
Read the Full Hartford Courant Article at:
[ https://www.courant.com/2025/11/19/ct-regulatory-agency-kills-2-4b-sale-of-water-company-amid-broad-political-concerns/ ]