The West Virginia Public Service Commission (PSC) has requested additional financial documentation from Star City regarding its water and sewer utilities. This request precedes the PSC’s evaluation of a joint petition filed on August 26, 2023 by Morgantown Utility Board (MUB) and Star City, which seeks to consolidate Star City’s utilities with MUB’s larger systems. If approved, this merger would allow MUB to assume complete ownership of Star City’s utilities, including all tangible and fixed capital assets.
In a memorandum issued in early October 2023, PSC staff emphasized that they cannot adequately assess the merger without the requested information. Specifically, they are seeking a financial analysis that supports the decision to proceed with the transaction, along with a detailed accounting history of the franchises, licenses, and equipment involved. This includes any plans for the assignment or allocation of the book values associated with these assets.
MUB and Star City have expressed objections to the PSC’s request, arguing that the motivation behind the acquisition is not financial but rather aimed at addressing environmental and efficiency concerns. They assert that MUB has no need for further accounting history since the relevant information is already available in Star City’s annual reports. Additionally, Star City has clarified that MUB will not inherit any debt or issue new debt connected to the proposed merger.
Despite these objections, the PSC staff reiterated their position in a response dated Monday. They highlighted that the required information is not included in the annual reports filed by Star City and MUB and should not be overly burdensome to provide. The staff insisted, “At a minimum, the petitioners should be required to provide the proposed journal entries as required by the Commission’s Rules of Practice and Procedure (Rule 10.5). When MUB acquires Star City, it will be required to make adjusting journal entries. Staff is requesting that the petitioners provide those adjusting journal entries as part of the filing in this case.”
Star City’s Mayor, Sharon Doyle, affirmed the town’s willingness to collaborate with the PSC. “Star City will work with the Commission and provide any information that it may deem necessary to review and approve this merger. As it is in the best interests of Star City and the larger community, we anticipate ultimate approval by the PSC and we will continue to work to that end,” Doyle stated.
MUB’s Communications Director, Chris Dale, added that all parties involved understood the process could take up to six months. He indicated that the additional financial requirements are not expected to significantly extend the timeline for the transaction.
As the PSC continues its review, the outcome of this merger could have substantial implications for both Star City residents and the broader Morgantown area, affecting service delivery and operational efficiencies in the region’s water and sewer systems.
