Ni America answers Bulletin questions

Published 5:58 pm Thursday, February 16, 2012

The Bulletin asked Ni America questions regarding its history and personnel this week.
Following are the questions and other information received from Rick Melcher, Ni America public relations:
Bulletin: Who is Ni America? Is it owned solely by its key personnel listed on the website or does it operate under a parent company? When was it formed and was it formerly another company or part of a larger company?
Melcher: Ni America was formed in 2007 to acquire regulated water and wastewater utilities.  It is an investor-owned company, with a small percentage of ownership by company management.  No other company affiliation.
Bulletin: How many systems does it own total and how many total customers does it serve? i.e. which systems in Florida, Texas and S.C. does it own?
Melcher: We currently own two water systems in TX, two in FL (one water, one wastewater) and three wastewater (systems) in SC. Total customers appx 30,000.
Bulletin: Why would Ni America be interested in a system such as Tryon’s? It seems small, with a lot of problems and far away from other systems Ni America owns. Does Tryon’s ability to be connected to a regional system from Asheville to Spartanburg have anything to do with the company’s interest? Is Ni America seeking to purchase any other systems, particularly in closer proximity to Tryon than its current systems?
Melcher: Ni has experience in acquiring and renovating privately owned systems, which often are out of compliance and in need of repairs. That is the nature of small to medium sized utilities all across the country.
As a growth-oriented acquisition company, we have looked for utilities across the southern U.S. that might be for sale. Tryon simply fit the typical kind of system, in need of repairs, which we are experienced with.
We believe we have the ability to correct compliance issues more cost effectively than government-owned systems and would even be happy to discuss how we could be of assistance with the larger regional system; however, we have not been invited to that discussion.
We have a fairly large presence in S.C. with Palmetto Utility and our newly acquired Alpine and Woodland wastewater systems in the Columbia area.
Bulletin: What is Ni America’s plan for Tryon? Does Ni America want to own and operate the system and keep the town’s current personnel or does Ni America have staff to come in and operate the system?
Melcher: As with any utility we would acquire, we conduct an inspection of the plants and collection/distribution systems to determine the issues that need to be repaired/corrected (to determine capital needs) and prepare an estimate of value of the system based upon current rates.
Additionally, as part of our due diligence, existing personnel would be interviewed and considered for continuity of operations. Generally speaking, existing personnel know the facilities and operating specifics, thereby adding value to the acquisition. Ultimately, providing excellent and efficient customer service is our expectation.
Bulletin: What is [Ni America Chairman] Jim McGiven’s exact role in Ni America and where is he located? Did he start the company? Is he still associated with American Water or Thames Water? If he’s not associated, when did he leave and for what reasons?
Melcher: As the website says, Jim has served as Ni America’s Chairman since 2009. We consider ourselves fortunate to bring his vast experience with large utility companies to our management team. Ni was started by its president, Ed Wallace, who has over 15 years’ experience in the acquisition and management of water and wastewater utilities.
Other information
supplied by Ni America
Following is other information Melcher sent to area newspapers:
Here are a few wastewater rates in the Columbia area. (We own/operate Alpine, Woodland and Palmetto Utility – all wastewater systems.) Alpine and Woodland are recent acquisitions of ours that needed a great deal of system improvements, as well as improvements to customer service. We are coordinating our efforts closely with Office of Regulatory Staff and DHEC (S.C. Department of Health and Environmental Control) in this regard and have, in six months, made great improvements to these systems.
Alpine $16.75
Woodland $24.00
Palmetto Utility $33.00
Richland County $46.54
City of Columbia $61.00 (@ 8,000 gallons)
Lexington County $58.53 (@ 8,000 gallons)
We first called on Tryon in 2010 to discuss how we could help with water and wastewater system costs. Our experience and expertise deals simply with bringing utility systems into regulatory compliance, i.e. – fixing problems. As a private (“investor-owned”) utility, we believe we can accomplish repairs/renovations at less cost than our public (government-owned) counterparts.
Privately owned utilities cannot set our own rates. Only the state public service commission can set private utility rates, and at the same time, we must adhere to and comply with all applicable regulatory requirements/standards.
One issue that helps us keep rates down is the fact that privately owned utilities, such as Ni America, design and build systems to meet current needs (say, population out five years) and allow for plant additions to be built as needed, rather than to build a current plant to meet demand conditions 30 years into the future. The latter option, often used by municipalities, places undue cost burden on current residents to pay for infrastructure that may not be utilized for decades.
We recently returned just as a follow-up with the Tryon City Council to see if we could help with their utility needs. Discussion of the details and the offer are prohibited by confidentiality agreement.

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