Inquirer: Republicans Eying PGWThe Philadelphia Inquirer has an important scoop this morning. Republicans in Harrisburg are planning to put forth a bill that would put the Philadelphia Gas Works under state control. PGW is a debt-ridden city agency that has been the center of controversy in recent years. The state would issue a bond to pay off the $1 billion in debt PGW has accumulated. Then, the agency would be privatized.
I'll let Councilman David Cohen and Michael Nutter debate the bill.
City Councilman Michael A. Nutter, chairman of the transportation and utility committee, said he "eagerly awaits" details of the proposal.I think PGW has been lax in previous years with debt collection and certainly could have been better about making customers pay their bills. At the same time, this is a public utility. I am deeply concerned that a essential service like heat could be turned over to a complain for private profit. The goal of an institution like the Philadelphia Gas Works shouldn't be to turn a profit. The purpose of this utility is to provide heat and power to all of our citizens. That won't be the goal of any company that decides to buy PGW. They'll be interested in making a few bucks and I think that shouldn't be mixed with such essential services.
"Clearly there needs to be a solution to PGW's financial and operational crisis," Nutter said. "I would like to see how a new gas entity would be structured to address service to low- and middle-income users and seniors, how it can be cost-competitive and reduce overall utility costs."
Nutter said city officials have been discussing a sale of PGW for a decade but knew that, with its debt load, it would be unattractive to a private utility.
But Councilman David Cohen said he was concerned that a bottom-line-oriented private utility would be quicker to turn off heat for those who couldn't afford it.
"This would destroy the very purpose of PGW as a public service," he said. "It would be much better if they devised a system of healthy payments to Philadelphia so that more of its citizens could get heat."
Of course, that doesn't even begin to address the question of what happens to the PGW employees. They are currently city workers and almost all unionized. They enjoy decent pay, healthcare and other benefits. privatization would jeopardize all of that. Does the de-unionization of city workers impact everyone? You bet. High union density in an economy is one of the best indicators for high wages and benefits across numerous industries. Period.