The Montana Public Service Commission will go to District Court to assert it's jurisdiction over the sale of Mountain Water to Liberty Utilities, and perhaps even attempt to unravel the sale. 

PSC Spokesman Eric Sell said the commission will seek the court to fine Mountain Water for its unapproved actions.

"There were several motions that the commission voted on today," Sell said. "One was to assert its jurisdiction over the sale and transfer of Mountain Water, and also to direct staff to go to district court to request fines against Mountain Water for proceeding with the sale and transfer without approval from the commission."

Another motion could actually lower rates the utility charges its Missoula customers.

"The commission also ordered an investigation into rate making at Mountain Water to reflect the new ownership," he said. "There was some testimony from the consumer counsel that Liberty's cost of debt was lower than that of the previous owner, so there's the potential to reflect that in its rates to consumers."

Sell said Mountain Water and through them, Liberty Utilities could be subject to daily fines.

"State law allows between $100 to $1,000 per day for this, and that has yet to be determined just what those fines will be, " Sell continued. "The fines would be levied from the day the sale happened (on January 5) moving forward, and how long that would be will be determined by the district court."

"The commission ordered staff to work with the Montana Attorney General's office to see if there were any other legal remedies that we could take to address the unauthorized sale of Mountain Water, and that could potentially include unraveling the sale, but that's all yet to be determined," he said.

Sell said any fines levied against Mountain Water could not be passed on the consumer.

Mountain Water Company and Liberty Utilities both issued statements following the decision at the Public Service Commission headquarters in Helena:

Statement from John Kappes, president of Mountain Water Company:

The PSC’s decision today regarding Liberty’s purchase of Western Water Holdings makes no sense under Montana law. Mountain Water has purchased other water systems in the past without PSC review, and without sanctions. This decision is not consistent with the law, and it’s not consistent with the past.

One thing that remains consistent with the past is that Missoula residents still receive safe, reliable, affordable water service from us. Today’s unfounded decision by the PSC won’t change that, and it won’t ultimately change the fact that Mountain Water is now pleased to be a part of Liberty Utilities.

Statement from Greg Sorensen, president of Liberty Utilities:

We are surprised and disappointed by the PSC’s actions today. We are confident that those actions won’t ultimately hold up.

All that the city’s team of lawyers has actually succeeded in doing is create more litigation, more expense and more wasted time for everyone. We were voluntarily participating in a very productive information exchange with the PSC, until the city inserted itself into that process. City officials still have not shown a good reason why they did that, and as a result they’ve caused everyone to lose in the process.