New Jersey American Water acquires Somerville sewer system, commits $9.5 million to upgrades

(UI) — New Jersey American Water has completed its acquisition of the wastewater collection system of the Borough of Somerville, N.J. for $7 million. This municipally owned system serves approximately 3,800 customers, most of whom already receive water service from New Jersey American Water.

In September, the New Jersey Board of Public Utilities approved the municipal consent allowing New Jersey American Water to provide sewer service to Somerville customers as of the closing of the transaction.

“As Somerville’s longtime water company, we are happy and honored to now also be their sewer company. We are ready to start making the needed improvements to provide the community with sewer service that is as safe, reliable and affordable as the water service we provide,” said Mark McDonough, president of New Jersey American Water.

The agreement to purchase the system was approved in a voter referendum in November 2022, which passed in a landslide fashion with 75 percent of the voters approving the sale of the system to New Jersey American Water. As part of the agreement, New Jersey American Water committed to invest a minimum of $9.5 million in sewer system improvements in the next 10 years.

“Selling the sewer system to New Jersey American Water was the right decision for our community. With private ownership of the system, the borough will eliminate the need for significant rate increases going forward and borrowing money for future improvements will end. Somerville will then be able to fund other needed projects, the sewer system will be maintained and improved on a consistent basis, and sewer rates will remain stable,” said Somerville Mayor Dennis Sullivan.

This is New Jersey American Water’s fourth sewer system acquisition within the company’s water footprint in the last five years, adding a total of more than 11,300 new wastewater customers. The company acquired the 2,800 customer Bound Brook sewer system in 2022; the 2,900 customer Long Hill Township sewer system in 2020, and the 1,800 customer Mount Ephraim sewer system in 2019. In June 2023, New Jersey American Water also completed its acquisition of Egg Harbor City’s water and sewer system via the state’s Water Infrastructure Protection Act, adding more than 1,500 water and sewer customers.

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