The state Senate Democratic majority crushed Republican efforts Wednesday to slow passage of an unvetted proposal allowing a New Haven-based public water authority to acquire one of the nation’s largest investor-owned water companies, Aquarion Water Company.
On a 20-9 party line vote, the Senate passed a 137-page omnibus bill in a special session originally envisioned primarily as a means to rectify a motor vehicle taxing problem left over from the regular session but eventually included an Aquarion issue that came as an 11th-hour surprise.
The House is to vote on the bill Thursday.
The largest section of the bill would enable the South Central Connecticut Regional Water Authority to bid for Aquarion and, if successful, create an Aquarion Water Authority that would oversee and set rates for a supplier of water to nearly 60 of Connecticut’s 169 cities and towns.
“This stinks. It might be the right policy. I just don’t know yet,” said Sen. Ryan Fazio, R-Greenwich. “We’ve had two days to analyze 50 pages of a policy change, which have an economic effect of billions of dollars without any sort of substantial input from experts, from the agencies, from the regulators.”
The Connecticut Mirror reported Friday that Aquarion would be an element of the special session call that Gov. Ned Lamont would issue the next day, a surprise to lawmakers. The authority’s interest in purchasing Aquarion had not been previously reported.
Senate President Pro Tem Martin M. Looney, D-New Haven, said the action was timely, since Eversource Energy, which purchased Aquarion in 2017, could sell the subsidiary before the General Assembly’s next regular session in January 2025.
He and Sen. John Fonfara, D-Hartford, who explained the bill, noted that it simply allowed a bid and that regulators would have final say over a sale.
But the Regional Water Authority operates outside the jurisdiction of state regulators, and lawmakers questioned what a purchase could mean to the finances of the water authority or the rates of a combined RWA-Aquarion system.
Fazio, the ranking Republican on the legislative committee that would have reviewed the legislation if proposed in regular session, said data at the Office of Consumer Counsel showed that the Aquarion’s regulated rates were lower than those of the RWA.
“It was not given any public vetting, any major public debate or analysis,” Fazio said. “And so I submit to you that no one knows what the consequences of what we’re voting on will be.”
Senate Minority Leader Stephen Harding Jr., R-Brookfield, and his staff approached Looney and his staff in the Senate chamber before the session opened to ask, at the least, for a separate vote on the Aquarion provision as a standalone bill.
Democrats refused, and they later defeated a motion to divide the bill and an amendment that would have struck the provision from the omnibus measure.
“I’m very happy that I’m going to support this amendment so that I can make it clear to my constituents that I don’t want my fingerprints on this thing at all. I do not want to be within 1,000 miles of this bit of legislation because I think this is a bad, bad set of terms to make a huge change in the way these consumers are going to purchase their water,” said Sen. Rob Sampson, R-Wolcott.
Democrats largely ignored the Republican objections in debate.
There was broad support for other portions of the bill.
Without the car tax fix, motor vehicles could have seen a tax increase in October. The fix would continue to classify commercial vehicles as motor vehicles, and it would clarify that current law allows municipalities to establish mill rates on motor vehicles that are lower than mill rates on real property and personal property.
Another component of the bill lays out new rules and timelines for the State Historic Preservation Office’s evaluation of state-funded redevelopment projects. SHPO sits within the Department of Economic and Community Development but currently has very little oversight, leaders of the Legislature’s Commerce Committee said.
Under the new law, SHPO would have just 30 days to make an initial determination of a project’s impact on “historic structures and landmarks” and, if possible, propose a “feasible alternative” the developer could pursue to avoid the impact. If there’s no alternative, SHPO would have to propose a mitigation plan within the next 15 days.
All of SHPO’s determinations would need to be provided to the developer in writing, and it would have to make public all its determinations on an annual basis. Developers would also have the option, within 15 days, to request the DECD commissioner’s review of any SHPO determination — and the commissioner would have 30 days to do so.
Commerce Committee Co-Chair Sen. Joan Hartley, D-Waterbury, said the bill — which overwhelmingly passed the committee this session but never came up for a vote in the House — was developed after committee members conducted a “listening tour” and heard constituents criticize the SHPO’s opaque process and inconsistent timelines. Evaluations stagnated, Hartley said, approvals were unexpectedly reversed, and in some cases that led developers to back out, leaving the sites — some among the most blighted urban properties in the state — no better off.
“We’re now going to have some sunlight on it,” Hartley said. “They’re going to have to report on it. There’s a definitive calendar.”
The bill also includes a special request of the governor and the Department of Economic and Community Development aimed at attracting certain kinds of financial services companies to the state that serve corporate customers.
These banks don’t offer personal banking for everyday retail clients, and thus are not insured by the FDIC; in Connecticut statue, they’re referred to as “uninsured banks.” That could now change. Across 40 pages of the special session bill, every instance of the term “uninsured bank” in state law was changed to “innovation bank.”
“This is timely is because a lot of the FinTech — and particularly the payment processing — industry would qualify under this charter,” said Rep. Jason Doucette, D-Manchester, the Banking Committee co-chair. “So it’s been part of an effort by the governor and the DECD to recruit these types of companies to Connecticut.”
The bill also reverses a provision inserted in a fiscal bill at the end of the regular session in May that would have allowed construction management companies to bid on work in school projects for which they had overall responsibility.
A Republican amendment to create a working group examining school construction bidding was rejected.