A proposed settlement that would end the state Public Service Commission's investigation of West Virginia American Water Co.'s handling of the January 2014 regional water crisis could lead to the construction of an alternative drinking water intake, parties in the case said this morning.
It would serve the company's customers in Charleston and surrounding Kanawha Valley communities.
The new intake -- which would provide a backup to the existing one on the Elk River -- isn't mandated by the language in a six-page term sheet outlining the proposed settlement, but a spokeswoman for West Virginia American indicated that the company intends to pursue such a project.
"It's not spelled out, but that is the direction we are headed," said Laura Martin, external affairs manager for West Virginia American.
The proposed settlement does require West Virginia American to conduct a detailed engineering study of ways to "enhance the resiliency" of its Kanawha Valley system, which is by far the largest drinking water operation in the state and serves hundreds of thousands of people. The study, due within a year, must include analysis of not just a second intake, but also expanded water storage capacity and "other operational enhancements."
The lack of a second intake contributed to major problems following the Jan. 9, 2014, spill at Freedom Industries. Without a second source of water, and after not closing its Elk River intake, West Virginia issued an order that residents and businesses not drink, cook with, or bathe in their tap water. For some residents and businesses, the "do not use" order lasted for up to a week.
Separate from the PSC case, West Virginia American has agreed to a class-action deal in federal court that would pay residents and businesses impacted by the water crisis up to $126 million.
The PSC has been conducting what it calls a "general investigation," in which state law gives it authority to look into whether a utility's actions have violated any state regulations or otherwise been "unjust, unreasonable, insufficient, or unjustly discriminatory." If it finds such problems, the PSC can then issue orders requiring utilities to remedy those conditions.
According to the term sheet, the settlement proposed to the PSC would also require improvements in West Virginia American's source-water protection planning, contingency planning for chemical spills and communication to the public about potential threats to drinking water.
It also outlines plans for improved contaminant monitoring both at the Elk River intake and a pilot project for additional monitoring located 30 minutes and 60 minutes upstream from the intake.
If approved by the PSC, the settlement would end a long-delayed investigation by the commission just as formal evidentiary hearings -- where numerous water company officials would have faced extensive cross examination about the events leading up to and following the Freedom spill -- were set to begin this week.
"The parties agree that the public interest may be best served through a stipulated conclusion to this general investigation that provides, among other things, for periodic documentation of the company's compliance with source-water protection, contingency planning, public communication and source-water monitoring obligations for [the Kanawha Valley system] as specified in applicable law," the term sheet says. "The pbulic will also benefit from increased transparency into, and a better understanding and increased awareness of, the company's efforts in these areas."
The term sheet was made public late this morning, following the announcement of the proposed settlement during a brief public commission meeting at the PSC headquarters in Charleston. Parties to the case asked commissioners to return to the bench this afternoon for a further explanation of the details of the deal. Commissioners have yet to announce if they will do that today or postpone such a discussion until a later date.
One party that intervened in the investigation, the local group Advocates for a Safe Water System, was not entirely pleased with the terms of the deal.
"We are aware of the terms and have agreed not to object, but we are not in a position to endorse or sign," said Paul Sheridan, lawyer for the Advocates group.
Last week, the Advocates organized a rally outside the commission headquarters to encourage the agency to conduct a full investigation of the water company's handling of the spill and make public all of the facts it gathers as part of that probe.
Reach Ken Ward Jr. at kward@wvgazettemail.com, 304-348-1702 or follow @kenwardjr on Twitter.