CHARLESTON, WV (WOAY) – A second state agency has filed a petition to intervene in the controversial sale of three Fayette County public service districts to West Virginia American Water, citing concerns that outstanding debt obligations are not adequately addressed in the current purchase agreement.
The West Virginia Department of Environmental Protection previously filed a similar petition.
“The proposed asset purchase agreement between WVAWC and FCC does not adequately protect the WDA with regard to repayment obligations of the grants, bonds, and/or loans that have been provided or issued to the districts from the funding programs administered by the WDA,” the WDA’s filing reads. “Any deterioration in credit standing would, in turn, increase the cost of capital and impair the state’s ability to cost-effectively fund water and sewer infrastructure improvements.”
The sale was originally expected to close around May 2025. When it had not, WOAY asked Fayette County Commissioner Allison Taylor in July about the delay.
“There may be some issues regarding grant forgiveness and we are going to have to seek some grant forgiveness from some state and federal government agencies,” Taylor said at the time.
All three Fayette County commissioners voted to approve the purchase agreement and continue to maintain that all debts are covered under the deal. When asked in July whether an independent evaluation had been conducted on the districts’ assets, Taylor said the process relied on a standardized formula rather than a separate independent appraisal.
“From what I understand, there is a formula that is used to evaluate the assets and all of the pieces, and West Virginia American Water just went by that formula,” Taylor said. “I don’t know who promulgates the formula, but I understand it’s fairly standardized. They plug the numbers into the formula based on their grants and their loans and everything else and the age of the infrastructure here.”
WOAY reached out to the Fayette County Commission for a more current statement about the issues the sale is facing.
When the DEP filed its intervention in December, also citing insufficient funds to cover outstanding debt, West Virginia American Water said it was confident the agreement was sufficient to fulfill all debts.
In their response at the time, a spokesperson said the DEP and WDA loans were “one and the same.”
This week, WOAY asked West Virginia American Water whether that was still its position following the WDA’s intervention.
“On Feb. 10, West Virginia American Water met with the parties in the case to discuss and clarify the long-term debt obligations of the PSDs and the process proposed in the transaction to resolve those obligations,” the company said. “The company has proposed sufficient means to resolve this debt and remains committed to working with all parties involved to find a solution for Fayette County residents.”
On Monday, representatives from the Public Service Commission staff, the Fayette County Commission, West Virginia American Water, the Department of Environmental Protection, the Water Development Authority, the Consumer Advocate Division and Kanawha Falls PSD gathered to address the debt issue directly.
The parties agreed that more information is needed before the matter can be resolved, but also agreed to continue working together toward a solution.
