Great Barrington — Long-troubled company Housatonic Water Works has filed an application with the state’s Department of Public Utilities seeking approval of two loans to finance a manganese filtration plant.
Back in July 2024, the Department of Public Utilities (DPU) approved a rate-increase request that allowed the company to increase its customer’s rates by over 90 percent over a span of five years.
A list of capital projects, including the installation of a manganese filtration plant, was included as part of the DPU’s approval.
In July, the company was fined $12,360 for various violations by the state’s Department of Environmental Protection (MassDEP). The fine was suspended as long as the company complied with terms and conditions outlined in a consent order, including adhering to a schedule for construction of the manganese treatment plant.
In September, HWW Treasurer James Mercer wrote to MassDEP that they were anticipating delays in the construction of the treatment plant.
On September 30, HWW filed an application with the DPU requesting approval for two loans that they deem necessary in order to finance the completion of the manganese filtration plant.
HWW’s filing and subsequent documents, which are available on the DPU’s website, were submitted by company attorneys Jed Nosal and Jesse Reyes of Boston law firm Womble Bond Dickinson.
According to a letter from the company sent to customers, the total cost of the project is approximately $1.67 million. The company states in the letter that a grant provided by MassDEP would reduce the project’s cost to customers by $350,000 and that the filing for the approval of the two loans “will not directly affect rates. The DPU will review a filing in a future proceeding to determine rate impacts after the project is complete.”
According to HWW, the first loan for $155,089 at 3.75 percent interest was already obtained in 2020 under the Small Business Administration’s COVID-19 Economic Injury Disaster program.
In the filing to the DPU, company attorneys Nosal and Reyes state:
While the Company acknowledges its failure to submit a petition for prior approval of the SBA Loan, the Company maintains that based on what was reasonably known at the time, the decision was in the best interests of the Company’s customers and financial operations to seize on a loan opportunity that was only available within a two-month window and might have been lost if the Company had gone through the traditional financing petition process.
The COVID-19 emergency represented an uncertain and unstable period, and the company did its best to navigate exigent circumstances of the emergency in good faith.
Additionally, the company is seeking to obtain a second commercial loan for $1 million at an interest rate not to exceed eight percent from CoBank ACB out of Denver, Colo., a cooperative bank and member of the Farm Credit System.
Nosal and Reyes state in the filing:
CoBank has indicated that the interest rate on a 20-year fixed rate loan currently available as of the date of this filing is 7.2 percent. The Department has recognized that the potential for financial market fluctuations or volatility requires the allowance of a measure of flexibility in setting maximum interest rates for long‑term debt securities. Over the past two years, the Department has consistently found that, given prevailing market conditions, a proposed maximum interest rate of eight percent is reasonable.
In total, the company seeks to incur long-term debt in an aggregate amount not to exceed $1,155,089.
As part of the filing with the DPU, Mercer submitted prefiled testimony, in which he states:
Although construction on the project site is underway, the Company will need the financing in place in the very near term to be able to submit an order to its vendors to schedule delivery of the Project’s equipment in time to complete the Project in a timely manner. Although the Company has advised MassDEP that it will likely need an extension due to the need for department approval of this financing petition, it is critical for the Company to be able to place the project in service prior to the start of the warmer weather months when the occurrence of manganese discoloration is at a higher risk. Accordingly, the Company is seeking expedited approval of this financing petition and requests approval within 90 to 120 days.
In the testimony, Mercer directly cites litigation filed against the company by Great Barrington, the town’s Board of Health, and West Stockbridge as hindrances in obtaining funding for the project:
Since issuance of the Department Order approving settlement on July 31, 2024, the company has made best efforts to finance and undertake this project. However, the Company’s lender, CoBank, declined to finance the project as a result of the risks arising from unanticipated litigation that arose shortly after the Department approved the settlement, namely the petition for judicial review of the Department order filed by the Towns of Great Barrington and West Stockbridge and an enforcement action commenced by the Great Barrington Board of Health and appeal from a court order granting a preliminary injunction of the enforcement action. Nevertheless, the Company started site construction in March 2025 using internally generated funds and a grant administered by MassDEP to meet MassDEP’s deadline to commence construction by July 31, 2025. The Company also made a substantial down payment on the manganese filtration system due to its long manufacturing lead time so that it could be ready to install when the building is completed. However, the Company needs the proposed financing in place to be able to schedule delivery of the equipment.
CoBank indicated that it would advance funds when the litigation is resolved and the Department has approved this financing petition. The Town of Great Barrington Selectboard voted on August 11, 2025 to withdraw its appeal of the rate case order. The Town of West Stockbridge Selectboard voted on August 18, 2025 to withdraw its appeal of the rate case. The Town of Great Barrington Board of Health voted on August 7, 2025 to rescind its enforcement order.
On October 1, Attorney General Andrea Campbell filed a notice of intervention in the case.
As of press time, a public hearing on HWW’s filing has not been scheduled by the DPU.
Click here for PDF documents pertaining to HWW’s filing.
