Source: Bond Buyer, December 6, 2017
The city of Missoula, Montana waged a six-year legal battle to wrest control of its water system from a private company. The water system in the town of 70,000 was privately-owned by Mountain Water – a company that refused to make needed repairs to the system or sell it to the city. … Obtaining traditional financing with no disclosure from Mountain Water — and water assets nearly beyond repair — was unattainable given the risks. The city also had to provide payment before the court could rule it owned the water system. The solution: the direct sale to Barclays of nearly $140 million in A-rated bond anticipation notes. The financing plan uniquely provided the necessary mechanics to allow the city to purchase the water system. Prior to the acquisition, water bills were 17% higher than elsewhere in the state, but dropped to 49% below average after the deal.
City Of Missoula Takes Ownership Of Mountain Water Company
Source: Beau Baker, MTPR, June 22, 2017
The city of Missoula has taken ownership of the water utility that serves its residents after a three-year court battle. The city bought Mountain Water Company for $84 million and paid another $6.8 million to developers who had a claim against the company. A separate bundle of transition costs, the bulk of which are attorneys’ fees, amounts to $7.5 million.
Mayor John Engen said city attorneys originally estimated the legal costs would be $400,000. Missoula won the right to buy the utility in an eminent domain case. It now joins all 128 cities and towns in Montana in controlling and owning its own water and distribution system. … Merriam says there are no immediate plans to change the rates. …
One for the history books: Missoula will buy its water system
Source: Sherry Devlin, Missoula Current, February 22, 2017
In an historic vote Monday night, the Missoula City Council unanimously approved the purchase of Mountain Water Co., forever ensuring the city’s “access to clean, affordable and reliable water.” … Throughout the recent effort, and decades of unsuccessful attempts by previous mayors and councils, the goal has been to place Missoula’s drinking water system into public ownership. … That now could happen by the end of March. With Monday’s vote, the local water system will be free from an increasingly distant and disaffected roster of corporate owners, most recently The Carlyle Group, a global investment fund, and the Canadian utility Algonquin Liberty. … Missoula’s water has always been in private ownership; all other Montana cities own their water system. … In fact, Bender said, Mountain Water Co.’s purchase by an international hedge fund – The Carlyle Group – imperiled every future generation.
The city’s purchase of its drinking water system will benefit those future generations the most, Bender said. …
A Privatized River Runs Through It
Source: Kate Whittle, In These Times, May 19, 2015
Missoula, Montana, the scenic mountain town that inspired A River Runs Through It, is fighting for control of the aquifer beneath it. Citing eminent domain, Missoula sued last year to take over the local water utility, Mountain Water Company, from its corporate owner, the Carlyle Group, a global investment firm with $194 billion in assets. Standing against this multi-billiondollar firm is the town of Missoula, with a population of 70,000 and an annual budget of about $116 million.
Public-Private Deals Spark Turmoil Montana City Attempts to Regain Control of Water System From Carlyle Group
Source: Mark Peters and Ryan Dezember, Wall Street Journal, September 14, 2014
Three years ago, Carlyle Group LP bought the pipes, pumps and water wells in Missoula, Mont., and several California communities in what the firm assumed was a relatively low-risk bet. By most accounts, drinking-water systems nationwide need hundreds of billions of dollars in repairs and upgrades, making them ripe for private investment. But the reality has been more complicated. Carlyle finds itself fighting in court to retain control of the Montana water utility. Missoula officials are suing under eminent domain laws to take control, accusing one of the world’s largest private-equity firms of reneging on a handshake deal to sell the system to the city. One of the California locales is considering a similar takeover for its water system. The dispute highlights the difficulties in what seems like a natural fit: using private money to fix the nation’s leaky pipes, outdated airports and crumbling bridges. “When we began, we thought municipalities would be open to involving the private sector,” said Robert Dove, who leads Carlyle’s infrastructure investing. “That has turned out to be more of a challenge.” In Washington, officials from both political parties are calling for more private investment in public works. The government says U.S. drinking water infrastructure alone needs $385 billion in repairs and upgrades by 2030. President Barack Obama in July launched an initiative to boost private investment in transit systems and utilities, and a congressional panel expects to issue a report this month on involving private firms in public infrastructure. Meanwhile, investors have committed about $263 billion to infrastructure funds since 2006, according to private-equity data tracker Preqin…