Council kills PGW deal

CITY COUNCIL yesterday torpedoed the plan to sell PGW, to the disbelief of Mayor Nutter, who had been pushing for the deal since March.

Council President Darrell Clarke said no public hearings would be held to consider the sale of the largest public utility in the nation.

"This is quite possibly the biggest cop-out that we've seen in recent legislative history in Philadelphia," Nutter said.

"What [the] Council president announced today, in my view, is a complete abdication of duty and responsibility. It is the opposite of transparency and openness. It is the opposite of democracy and action."

Clarke convened a last-minute news conference to announce that Council members have "no appetite" to sell the gas utility to the Connecticut company UIL Holdings Inc. for $1.86 billion. He said the deal as proposed was too limiting and tied Council's hands.

After months of deliberations, Clarke determined that results from an independent study on the sale had convinced Council members that it was a bust.

"This was a very limited RFP [request for proposal] - the way it was structured imposed significant limitations on any respondent and subsequently on members of Council," Clarke said.

Later in the day, Clarke released the findings of the sale analysis drawn up by Concentric Energy Advisors, the firm hired by Council to break down the merits of the deal. He called Concentric "the best consultant in the country."

Among other things, Clarke claimed that the sale would not net the $400 million to $600 million for the city's cash-strapped pension fund predicted by the Nutter administration.

He said he would introduce a resolution Thursday in Council calling for hearings to discuss the "broader picture" of selling the largest municipal asset in Philadelphia history.

"If people want to talk about anything as it relates to energy, they will be given that opportunity at a public hearing."

Nutter said just the opposite, arguing that UIL had pitched the best bid among 33 companies that made offers.

"Sadly, this announcement today is not a shining moment of leadership in our city," the mayor said.

"People of Philadelphia should have the full opportunity to be heard and also to hear all of the details of this proposed sale. That's democracy."

The gas workers' union, Local 686, praised Council's decision and thanked Clarke for advocating for its members.

"The proposed sale was never in the best interests of our citizens, especially the poor and elderly on fixed incomes," union spokesman Frank Keel said.

"PGW is a stable, profitable city asset, and we are delighted that it will remain so."

Meanwhile, the good-government group Committee of Seventy lambasted Council's unilateral decision to kill the proposal, calling it "an affront to taxpayers."

"Today's action violates every principle of transparent and effective governance," said Ellen Kaplan, Seventy's CEO.

The Greater Philadelphia Chamber of Commerce echoed that sentiment, issuing a call for action on the situation.