Monday, December 9, 2013
By Colin Woodard email@example.com
(Continued from page 1)
This arrangement ended in 2008, when Nestle bought Pure Mountain Springs, allowing it to purchase bulk water at the going rate, currently about one-tenth of a cent per gallon. Welch, then at Pierce Atwood, advised the company on the deal. Simultaneously, Fryeburg Water Co. gave Nestle its contractually required five-year notice that it wanted to renegotiate their relationship, setting the stage for the current case before the PUC.
Under the proposed contract, Nestle will continue to draw water at a low “tariff” rate and pay lease fees to the water company but will make a guaranteed minimum payment of about $144,000 every year, ensuring a more predictable cash flow. Nestle Waters’ payments account for about 40 percent of the utility’s operating revenues.
Opponents of the contract have argued that this price may be too low, and that the PUC would be wise to learn what price Pure Mountain Springs charged Nestle for the water between 1997 and 2008 as a way of determining its fair market value.
Bruce McGlauflin, an attorney representing two contract opponents, said their ultimate concern is about long-term sustainability of the resource. Low-pricing, he told the Press Herald, would “incentivize Nestle to maximize its purchases” of Fryeburg water, rather than encourage sustainability.
Opposition briefs are due to be filed Oct. 1, and the company’s rebuttal to them on Oct. 8. Staff reports would follow later in the month, clearing the way for a final decision on the matter to be made in early November.