The sale of Haddonfi eld’s
water and wastewater
system to New Jersey
American Water made
good sense for customers
and the community.
Better quality, improved
reliability and lower rates
in the long-term.
Kevin Watsey
Government Affairs
856.782.2372
David Marino
Business Development
609.677.4600
10-2017
SOLUTIONS
THAT WORK
WE KEEP LIFE FLOWING
™
QUESTIONS?
SOLUTION: SALE OF WATER AND
WASTEWATER SYSTEM
HISTORY OF INVESTMENT
The Haddon eld Water and Sewer Utility is a 129-year old Borough-owned system. All
funds for the operation, maintenance and capital investment of the system were raised
through the quarterly water/sewer bill paid by Haddon eld residents. No property tax
dollars are used. Prior to 2003, the Borough invested very little in the system, and that
lack of investment kept rates arti cially low. Between 2003 and 2008, the Borough spent
$15.983 million on high priority projects.
ADDRESSING SYSTEM NEEDS: A LOOK TOWARD THE FUTURE
In 2013, the Borough formed a volunteer Community Advisory Committee to take an
independent look at the systems. The Committee recommended a rate increase of
25 percent to cover the debt service on the capital already spent. The Commissioners
agreed, and the rate increase took effect during the second half of 2014.
The Borough engaged its engineering  rm to provide a detailed analysis of the current
condition of the water and wastewater systems, and estimate the cost of bringing the
systems up to standard. The engineering report estimated that the Borough’s systems
would need an estimated $50 million over the next 30 years, heavily front loaded in the
rst 10 years to avoid a major failure. This estimate assumed operations with no major
issues identi ed, and included only a 5 percent contingency, which the Committee felt
was low.
OPTIONS EVALUATED
The Committee evaluated multiple options for  xing and managing the
systems, including:
• Conducting an ef ciency survey of existing personnel for resource optimization and
ef ciency
• Partnering with a neighboring utility for purchasing power and possible shared staf ng
• Awarding a management contract for the system operations
• Leasing the utility
• Selling the utility
ADDRESSING
HADDONFIELD’S
NEEDS
Haddon eld Water
Treatment Plant
Haddon eld Water
Treatment Plant
HADDONFIELD WATER SYSTEM
Customers Served: 4,645
Water Main: Approximately 51 miles, ranging in
size from 4-inch to 16-inch, ranging in age from
1889 to present
System Needs - Mains: The NJ Department of
Environmental Protection requires that nearly
two miles of 4-inch water mains be replaced
and increased in size. In addition, according to
an outside engineering study conducted on the
system, about 60 percent of the mains
(30.6 miles) need to be replaced within the next
30 years.
System Needs - Wells: The Borough’s three
wells were last serviced in 2008. Two are due
for signi cant overhauls.
Water Treatment: Treatment was provided
by two plants (one abandoned), where iron is
removed and disinfection is accomplished with
chlorine gas.
Water Tank: Pressure to the system is provided
by a 400,000-gallon standpipe, which was built
in 1899.
BEST OPTION IDENTIFIED
Given the condition of the system, and the impact of the necessary
capital investment for only 4,500 accounts, the committee and
the commissioners unanimously agreed that the best option was a
sale of the utility. The Borough issued a bid to sell the systems and
received three quali ed bids. New Jersey American Water’s bid of
$28.5 million was deemed the winning bid.
According to the Commissioners, additional reasons supporting a
sale to New Jersey American Water included:
• A record of being more effective stewards of our system than
the Borough has proven to be
• With 650,000 accounts serving 2.5 million customers in New
Jersey. This gives New Jersey American Water a much larger rate
base over which to spread costs.
• Signi cant expertise in managing and operating water and
sewer systems, with greater economies of scale that provide
much greater levels of ef ciency and lower costs for purchasing,
engineering and constructing projects.
• Access to a large annual capital improvement budget
(~$200 million/year)
• Experts focused on continual Federal and State regulatory
changes, and can react much more quickly and effectively.
• Heavily regulated by the state. They can only increase rates
after proving their case to the State BPU. The company is
required by the State to provide service, and
customers can go to the BPU to complain if service is not
satisfactory.
PROJECTED ANNUAL WATER BILLS
(Based on an average household use of 58,000 gallons/year)
Original chart created by and based on analysis by the Borough of
Haddon eld.
SOLUTIONS. ONE MORE WAY
WE KEEP LIFE FLOWING.
1,200
1,000
800
600
Haddon eld Municipal Water
New Jersey American Water
RESIDENTS AGREED
The Commissioners passed an ordinance placing the sale to
New Jersey American Water as a referendum question on the
November 4 general election. Haddon eld voters approved the sale
by nearly two to one in favor of the sale.
newjerseyamwater.com
Haddon eld Water Tank
HADDONFIELD SEWER SYSTEM
Sewer Main: 55.5 miles of main collect and
convey waste to the Camden County Municipal
Utility Authority for treatment. The system is
mainly old 8-inch terra cotta, suffering from
cracking, settling, joint separation and tree root
in ltration.
System Needs - Mains: Engineering studies
indicated that 40 percent of the lines require
action within the next  ve years; 40 percent in
10 to 15 years, and the remaining 20 percent in
15 to 30 years.
Pumping/Lift Stations: six lift (pumping)
stations. Two are in good operating order; Four
need to be replaced or signi cantly renovated.
Wastewater
Pump Station
Wastewater Manhole
Next to Cooper River