The East Whiteland case was notable because it marked the first time the Pennsylvania Supreme Court reviewed a Fair Market Value (FMV) transaction. By the time the Commonwealth Court reversed the Public Utility Commission’s (PUC) approval, the deal had already closed, and the system was on Essential Utilities’ books. The Supreme Court’s role was not to re‑evaluate the public benefits of the sale, but to decide whether the Commonwealth Court had exceeded its authority in overturning the PUC.

“The PUC is the designated expert in these transactions, and is charged with testing the record and deciding whether, on balance, there are substantial public benefits,” Wyatt explained.

Tom also emphasized that benefits in these deals are not always easily measurable: “One important thing here is that the public benefits can be qualitative and long-term – not everything needs to be immediate or quantifiable.” He told GWI that while future rate impacts should be considered, “A speculative guess that the PUC is going to raise rates is simply not a known harm at the time of a deal’s approval, and the Supreme Court affirmed that the PUC has the power to determine the benefits.”

The decision raises the question of whether Pennsylvania municipalities will now be more likely to pursue the sale of water or sewer systems.

“Predictability is back, but it doesn’t mean the PUC is going to rubber-stamp any transaction,” Wyatt observed. “I absolutely believe that fair market value is back in play, but depreciated original cost sales are still happening. Having multiple ways to monetise assets is good for Pennsylvania, and the PUC has done a lot of work to put guardrails around the purchase price and to ensure transparency.”

Tom expects renewed interest: “I would be really surprised if the opportunity to use this tool is not reinvigorated in 2026. There are a lot of communities that want out of the water and sewer business.”