Pennsylvania American Water Acquires Municipal Wastewater System in York County

Pennsylvania American Water, a subsidiary of American Water (NYSE: AWK), announced today that it has acquired the wastewater system of Fairview Township, York County. The purchase price for acquisition is approximately $16.8 million.

The newly acquired system provides wastewater service to approximately 4,000 customers, including more than 200 businesses and commercial accounts where Pennsylvania American Water is already the provider of water service for Fairview Township.

“We are very pleased to close the year with a significant acquisition that further expands our roster of wastewater operations,” said Pennsylvania American Water President Kathy L. Pape. “The acquisition provides a long-term wastewater solution and financial relief for the local community, and is also a perfect fit within our existing water footprint.”

In addition to the $16.8 million purchase price, the company agreed to invest $13 million in system improvements and reimburse the township for up to $1 million for a sewer line relocation project related to the Pennsylvania Turnpike.

“This transaction brings a number of benefits for our community,” said Fairview Township Board of Supervisors Chairman Robert P. Stanley Jr. “As a result of the sale, township residents will receive a 50 percent reduction in real estate taxes in 2016. The sale’s proceeds will help pay off approximately $21 million in sewer debt and avoid an anticipated $14 million in additional debt that might have been incurred to complete planned projects.”

Under terms of the purchase agreement approved by the Pennsylvania Public Utility Commission, Pennsylvania American Water has adopted Fairview Township’s existing wastewater rates through December 31, 2017. In addition, the four township employees who operate the wastewater system have been offered employment with Pennsylvania American Water.

As part of its $13 million capital improvement commitment, Pennsylvania American Water will install approximately 23,500 feet of new wastewater lines to provide public wastewater service to about 200 homes and businesses in Fairview Township. Furthermore, under the company’s ownership, the $9,500 per EDU tap-in fee for existing homes and businesses, which the township had been charging, will not be required. The company’s tap-in fees for new homes and business will be $4,000 per EDU.

This transaction follows a series of acquisitions announced by the company in October, comprising five municipal and privately owned water and wastewater systems in Clarion, Northumberland and Butler counties. Pennsylvania American Water also operates wastewater systems in Adams, Beaver, Chester, Monroe, Pike and Washington counties.

Pennsylvania American Water, a subsidiary of American Water (NYSE: AWK), is the largest water utility in the state, providing high-quality and reliable water and/or wastewater services to approximately 2.2 million people. Founded in 1886, American Water is the largest and most geographically diverse publicly traded U.S. water and wastewater utility company. With headquarters in Voorhees, N.J., the company employs approximately 6,800 dedicated professionals who provide drinking water, wastewater and other related services to an estimated 15 million people in 47 states and parts of Canada.

This release contains forward looking statements, including, among others, our plan to continue our long-term strategy of capital investment in our systems. There are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements including: general economic business conditions, unfavorable weather conditions, changes in regulations or regulatory treatment and availability and the cost of capital. We undertake no obligation to publicly update or revise any forward-looking statement.

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