The city of Missoula and the Clark Fork Coalition are calling on state regulators to stop proceedings in the proposed Mountain Water Co. sale.
"Due to the pending eminent domain action in the Fourth Judicial District Court, the commission should stay the proceedings in this docket until a decision about the city's bid for ownership (has) been resolved," the Coalition said.
This week, the city, the water watchdog, Mountain Water employees, and the Montana Consumer Counsel filed petitions to intervene in the proposed sale of the water company to Liberty Utilities. Liberty is a subsidiary of Algonquin Power and Utilities Corp. of Canada.
The joint application for sale approval is pending before the Montana Public Service Commission.
In its petition, the Clark Fork Coalition also requests the Public Service Commission order Algonquin itself to be a party in the proceeding. It argues that naming Algonquin is crucial so the company can be questioned about its operations and plans.
"The Missoula community deserves to understand Algonquin's intentions for owning, managing and operating Mountain Water, no matter how many complex corporate layers separate the Missoula ratepayers from the ultimate upstream owner," said the Clark Fork Coalition.
In 2011, the state agency approved a sale of Mountain Water to global equity firm The Carlyle Group. This fall, Carlyle announced it planned to sell Western Water Holdings to Algonquin; Western Water is made up of Mountain Water Co., parent company Park Water in California, and Apple Valley Ranchos in California.
In the filing, the nonprofit continued: "CFC is not opposed to complex, creative, and confidential business strategies – except when it concerns Missoula's drinking water system."
Algonquin spokeswoman Kelly Castledine said Tuesday the company was still reviewing petitions and had no comment on whether it would agree to be named a party or would oppose the request.
Last spring, the city of Missoula took Mountain Water and Carlyle to court to try to force a sale of the local water company to the city. The trial is scheduled for March 18.
Mountain Water employees also requested to intervene and stated their support for the sale to Liberty. Staff and officers said any sale will affect their employment and livelihood, and they highlighted Liberty's pledges to employees in its application to buy Mountain Water.
"Liberty Utilities considers the capable management team and employment base of Park Water and Mountain Water to be available to their respective operations," Mountain's employees said, quoting Liberty.
"All of the employees of Mountain Water Company, without exception, signed a petition to the mayor and city counsel (sic) of the city of Missoula that none of them would accept employment with the city of Missoula based upon (the city's) plan to eliminate positions and its refusal to commit to maintain wages, benefits and comparable working conditions," attorneys for the employees wrote.
The city of Missoula earlier argued the only positions it has not promised to keep are those of top officers who – unlike staff – might stand to gain in a sale to Algonquin. Mayor John Engen has said the city also presented a different offer to executives because their duties likely would change if the city took ownership.
In its own petition, the city "opposes the PSC's potential approval of Mountain Water's sale to a foreign, public-traded corporation."
"It was just a few years ago, in 2011, that Mountain Water was sold to a private hedge fund, and now Carlyle intends to flip it to a foreign corporation," the city wrote. "Carlyle promised, under oath before the PSC, that it would be a 'long-term' owner of Mountain Water, but now attempts to sell Mountain Water in less than three years.
"While Liberty too claims it plans to be a 'long-term' owner, such assurances turned out to be false when made by Carlyle."
Algonquin CEO Ian Robertson earlier said Liberty has never sold any of its companies. However, Liberty has been around only since 2009.
In the filings, the city estimates Carlyle is selling Mountain Water for twice as much as it paid in 2011, and the Clark Fork Coalition estimates the equity firm is paying more than three times as much.
"Missoula ratepayers will see nothing from that significant increase in value, other than an increase in rates," said the Coalition.
A Public Service Commission lawyer could not be reached Tuesday for comment on the proceedings.