No quick OK by Council seen for PGW sale

Posted: March 05, 2014

Once City Council gets a look at the favorable terms for selling the Philadelphia Gas Works, Mayor Nutter predicted Monday, the deal will be approved with "overwhelming support."

But Gas Workers Local 686, which opposes the sale, is confident Council will stand as a bulwark against the deal, which the union fears will put jobs and pensions in jeopardy.

Either way, Council President Darrell L. Clarke called the proposed sale "the most significant transaction . . . in the history of the city."

In an interview Monday evening, he made clear that Council, which has not been part of the four-year process of trying to find a buyer, would not be rushed into the necessary approval.

"To suggest that Council simply gets an ordinance sent from the administration and then gets pressured to move on it to accommodate somebody's time frame, it's just not realistic," Clarke said.

Clarke, who has battled with Nutter on most issues of importance in recent years, said he did not know how much time Council would need to scrutinize the sale.

The winning bidder, Connecticut-based UIL Holdings Corp., has the option to back out of the $1.86 billion deal if Council takes no action by July 15.

Clarke sounded skeptical about unloading such a "valuable asset," saying he would like to see PGW do what a private company would do - diversify and take advantage of the natural gas boom in the Marcellus Shale.

"If I have an opportunity to do more with that asset, that would be my first option," he said.

How much opposition the deal faces on Council was tough to gauge Monday, although Clarke generally reflects the mood of his colleagues.

A handful of members who either have independent voices on Council or who could influence the debate did not return calls or declined to comment.

Councilwoman Marian B. Tasco would fall into both categories. She chairs the Philadelphia Gas Commission, which oversees PGW, and is a savvy veteran of Council. She could not be reached Monday, but her public comments so far have signaled opposition to a sale.

Frank Keel, a spokesman for the 1,150-member gas workers union, said Council members "by and large have told us repeatedly they are with us in opposition to a sale."

He said a coalition of groups, including the city's politically powerful building trades unions, would lobby Council to stop the sale. They could find fertile ground among some members.

Councilman James F. Kenney, for instance, objected to Council's being kept in the dark on the PGW deal, thanks largely to a nondisclosure agreement bidders had to abide by.

"Could you imagine any company allowing the CEO to do a $2 billion deal without the input of the board of directors?" he said. "The respondents were told not to even go near us, but we're the ones who have to vote on it."

Council has hired two consultants in recent months - one to explore the bids for PGW and one to examine whether PGW could expand and stand alone.

Clarke, too, sounded irked at just now being brought into the discussion.

"It's consistent with the way this administration operates," he said. "Internally, they have an idea, they keep it as close to the vest as possible, then they spring it on you at the last minute and expect you to simply sign off."


tgraham@phillynews.com

215-854-2730 @troyjgraham

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