At its March 20, the Hopewell Borough Council passed a resolution approving a proposed Contract with New Jersey American Water for the sale of the borough’s water system.
Before being finalized, the contract must be reviewed and approved by the Board of Public Utilities, and the Division of Local Government Services in the Department of Community Affairs. Once approved by those agencies, the contract will be subject to a public referendum on the ballot of the November 2025 general election.
EXPLAINER: The Water Infrastructure Protection Act
New Jersey’s Water Infrastructure Protection Act, passed in 2015, allows certain owners of water systems to sell their assets to a public or private entity if certain emergent conditions exist.
The sale of the water system requires the approval by a majority of Hopewell Borough voters in that election.
New Jersey American Water has agreed to purchase the Borough’s Water System for $6.4 million. It has also agreed, upon closing, to disconnect Well No. 4, which the borough says would bring its water supply immediately into compliance with the DEP standard for PFOS.
New Jersey American Water has also agreed to immediately upon closing implement Water Rate Schedule A-1, which the borough says will provide for significant rate relief. NJAW rates would match rates currently in place in the neighboring communities of Princeton and Montgomery.
The borough says that New Jersey American Water has agreed to invest at least $7 million in the water system over its first 5 years of ownership. These costs are spread across all NJAW rate payers, and not just Hopewell Borough residents.
New Jersey American Water has agreed to improve the water storage system within the first 5 years of ownership, according to the borough. NJAW also must comply with regulations to remove all lead goosenecks and galvanized water lines by 2031 without additional direct costs allocated to the borough or its customers.
New Jersey American Water has agreed to refund the borough up to $150,000 towards the borough’s transactions costs incurred in connection with the sale of the system.
As required by WIPA, the contract will be submitted to the Board of Public Utilities and the Division of Local Government Services in the Department of Community Affairs for their respective reviews and is subject to their approvals prior to formal execution by the borough and NJAW.
Following approval by the state, the terms of the contract would be presented to the borough voters at the November 2025 general election for approval.
The draft contact between Hopewell Borough and New Jersey American Water is posted online. During the coming months, the borough council says it will host public information sessions and present the results of our ongoing fiscal and engineering analysis of the water system.
The council also pledges to provide updates and opportunities for public input during regularly scheduled council meetings.
