Obermayer Team Secures Pennsylvania Supreme Court Victory for East Whiteland, Greenlighting that Sewer Sale and Removing Uncertainty from the Marketplace

An Obermayer multidisciplinary team led by Tom Wyatt, Chair of Obermayer’s Municipal Infrastructure and Services Practice Group, and Mathieu Shapiro, head of the firm’s appellate practice, secured a unanimous (7–0) decision from the Pennsylvania Supreme Court affirming the authority of the Pennsylvania Public Utility Commission (PUC) to approve the sale of a municipal sewer system. Thus, setting the stage for East Whiteland Township to move forward on all the goals it had when it decided to exit the sewer service business. This ruling also has significant implications for municipalities and regulated utilities throughout the Commonwealth.

The decision, issued on December 16, 2025, reversed the Commonwealth Court and upheld the PUC’s approval of the East Whiteland Township Public Sewer System’s sale to Aqua Pennsylvania. The Supreme Court reaffirmed that the Commission—not a court—is responsible for determining whether transactions provide a public benefit when reviewing applications for certificates of public convenience by regulated utilities.

Thomas S. Wyatt

Kimberly A. Farmer

The Obermayer team has worked with the Township for almost 8 years on this $54 million sale project: from the initial study of the Sewer System, the transparent vetting of the transaction to the public, identifying qualified buyers, negotiating the sale transaction, obtaining PUC approval for the transaction, and serving as appellate counsel, representing the Township throughout the Supreme Court proceedings.
Tom Wyatt and Kimberly Farmer negotiated and closed the Sewer System asset sale.

Matthew S. Olesh

Matthew Olesh and Tom Wyatt obtained the necessary PUC approval of the transaction in an application process where the PUC found substantial public benefits from the transaction.

Appellate lawyers Mathieu Shapiro and Melissa Blanco handled petitioning the Court to hear the case on behalf of the Township and, ultimately, briefing the case and arguing it to the Court. 

Mathieu J. Shapiro

Melissa M. Blanco

The PA Office of Consumer Advocate appealed the PUC approval to the Commonwealth Court, and that Court reversed the PUC decision. The Township appealed to the Supreme Court, and the Court took up its appeal.
At the heart of the appeal to the Supreme Court was whether the Commonwealth Court had improperly substituted its own judgment for that of the PUC, despite substantial evidence supporting the Commission’s approval of the transaction. The Supreme Court sided with the Township and the PUC, holding that judicial review must defer to the Commission’s expertise when the record demonstrates a reasoned determination of public benefit.

In affirming the PUC’s authority, the Court credited extensive evidence supporting the transaction. This included reduced operating expenses, increased capital investment, improved regulatory compliance and system efficiencies, enhanced customer service and billing protections, and the PUC’s finding that the Township may be unable to independently fund necessary system upgrades while meeting other municipal priorities.

Of particular importance to future municipal utility transactions, the Court rejected the argument that the potential for rate increases constitutes a “known harm” sufficient to invalidate any PUC approval. Instead, the Court emphasized that rate impacts must be evaluated in the context of overall public benefit, endorsing the PUC’s conclusion that rates were likely to rise regardless of ownership, but that the transaction offered greater flexibility and consumer protections in managing future rate pressures. The Court also gave credence to the Township’s desire to get out of the sewer service business and focus on other important matters, such as economic development.

“This decision is a clear and decisive affirmation of the PUC’s expertise and authority,” said Scott Lambert, Chair of the East Whiteland Township Board of Supervisors. “The Supreme Court recognized the significant and concrete benefits this transaction provides to our community.”

The Court’s factual background and analysis closely tracked arguments advanced in Obermayer’s briefing, including the historical role of public utility consolidation—an issue central to the Court’s reasoning.

“As a part of the Township’s team from the very beginning of this project, it is extremely gratifying to move past years of litigation and look forward to the Township moving forward with improving the lives of its residents,” Tom Wyatt said.

This ruling is expected to have a lasting impact on how municipal sewer and water system transactions are reviewed and approved in Pennsylvania, providing a clearer and more predictable path forward for local governments facing aging infrastructure, funding constraints, and increasing regulatory demands.

If you would like to schedule a time to discuss this case and the marketplace more generally, please contact Tom Wyatt at thomas.wyatt@obermayer.com.

Tom and Obermayer Provide – Clarity. Options. Leverage – Before any major infrastructure decision.