Monday, December 9, 2013
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Thomas Welch, chairman of the Maine Public Utilities Commission, had been Nestle Waters’ attorney until his appointment to the PUC in March 2011.
While the case remains in limbo, the two companies’ current contract will remain in effect. That contract can be canceled or renegotiated by either party with five years’ notice.
Fryeburg Water Co. gave notice five years ago, after Nestle Waters bought Pure Mountain Springs, the pass-through company that members of the Hastings family set up with a partner to allow them to sell water from the local Wards Brook aquifer at a higher price than the utility is allowed to charge.
That pass-through company was led by John Hastings, but his father – family patriarch and Fryeburg Water Co. President Hugh Hastings – maintained power of attorney for the five years.
John Hastings has testified that his father made all decisions during that period. The pass-through company bought water from Fryeburg Water Co. at its ordinary rate – about a tenth of a cent a gallon – and sold it to Nestle Waters at a much higher rate.
Nestle Waters has refused to disclose what that rate was, and at a hearing on Sept. 3, John and Hugh Hastings testified that they don’t remember the rate.
Opponents have wanted to learn what Nestle Waters was willing to pay the pass-through company, as a way of determining the fair value of the water that Nestle would pump from Fryeburg’s springs for the next 25 to 40 years.
“I guess it comes down to finding out the fair price of water,” said Bruce Taylor, a Fryeburg-area resident who has challenged the contract in the PUC proceedings. “I think it’s very important to know what Nestle was paying then, but we couldn’t get at that information.”
Fryeburg Water Co. representatives have argued that it’s irrelevant to the current proceedings, and that Nestle Waters’ presence has greatly benefited the utility’s ratepayers by providing revenue that helps pay for infrastructure and keeps rates low.
Since 2008, when Nestle Waters bought Pure Mountain Springs, it has been paying the low utility customer rates. It would continue to do so under the proposed 25-year contract.
Under the proposed contract, Nestle also would continue paying lease fees to the water company, while making a guaranteed minimum payment of about $144,000 every year. Nestle Waters’ payments account for about 40 percent of the Fryeburg Water Co.’s operating revenues.
Taylor said he is pleased with Welch’s decision to recuse himself, but he questions whether it should invalidate some prior rulings on motions aimed at leveraging Nestle Waters to disclose information about its past relationship with Pure Mountain Springs.
Colin Woodard can be contacted at 791-6317 or at:firstname.lastname@example.orgTwitter: @WoodardColin