PICA endorses sale of PGW

Posted: May 22, 2014

The state board that oversees the city's finances on Tuesday gave its stamp of approval on the pending sale of the Philadelphia Gas Works in a $1.9 billion deal with UIL Holdings Inc.

Mayor Nutter wants to sell the 176-year-old utility to use the proceeds to reduce the city's underfunded pension obligations.

The deal, which must still be approved by City Council and the Pennsylvania Public Utility Commission, is opposed by the gas workers' union, low-income advocates, and opponents of private ownership, all of whom have been putting pressure on Council to say no.

At Tuesday's meeting of the Pennsylvania Intergovernmental Cooperation Authority (PICA), administration officials gave a seven-page presentation highlighting what they consider the best aspects of the deal, including no layoffs for three years, and paying at least $420 million into the pension fund.

Suzanne Biemiller, who has been leading the sale talks for the Nutter administration, told PICA board members after the presentation that it was urgent that City Council approve the sale.

"There is a risk [UIL Holdings] could walk away on July 15," she said.

Council has agreed to pay a Boston-area consultant $425,000 to review the deal.

Lawrence Tabas, a new board member who participated in his first PICA meeting via conference call, said he supported the sale.

The sale is "very consistent" with the board's desire to reduce pension obligations, said Tabas, who was appointed to the board by Gov. Corbett after Sam Katz stepped down in February.

The board's vice chair, Michael Karp, asked Biemiller whether PICA could do anything to help the administration win Council's support for the sale.

"People on Council aren't numbers people," Karp said. "I would be happy to meet with people to explain the numbers."


cvargas@phillynews.com

215-854-5520 @InqCVargas

comments powered by Disqus
|
|
|
|
|