GONZALES — Peoples Water Service Co. has asked for a 120-day extension of the deadline to close on its $6 million sale to the Ascension Parish government, parish officials said.
Parish officials have been negotiating the purchase since last year under former Parish President Tommy Martinez. But Peoples Water came under intense regulatory scrutiny last month after state health officials uncovered that on nine days since September, internal company tests showed water at the plant had levels of the disinfectant chlorine dioxide well above federal water quality standards.
The discovery of the high chlorine dioxide water prompted a do-not-drink order for several days in Donaldsonville over concerns the water could harm the nervous systems of young children and fetuses, and sparked an investigation by the state Department of Health and Hospitals.
The Donaldsonville utility’s request for a delay of the closing deadline, from May 22 to Aug. 31, came at the suggestion of parish officials, the parish attorney revealed Thursday.
“We have, at this point in time, advised them that they could not meet the terms of the contract by the May 22 date, and we suggested that if they still wanted to be involved with us, they needed to request an extension, and they did that,” O’Neil Parenton Jr. told the Parish Council.
His comment came in response to a question from Councilman Oliver Joseph whether the parish is making sure it would not be liable for Peoples Water’s troubles with DHH.
At the time, the council members were being asked to approve budgetary moves to position $5.9 million for a future purchase.
Parenton said the ordinance to shift the dollars was done with an eye toward the May 22 closing date before the request for the extension.
“We’re not giving them any money,” Parenton told Councilman Todd Lambert. “It’s just moving money.”
The council adopted that and other budget changes without opposition. The council Utilities Committee is expected to consider the Peoples Water extension request next month.
DHH has put the company under a 60-day administrative order to rectify its problems and perform upgrades.
The company, which claimed the high chlorine dioxide water never reached residents, never reported the high readings to DHH or the public, as required by law, but gave DHH readings that showed the water was within water standards, DHH officials have said.
Sherlock “Shockey” Gillet Jr., president of Peoples Water, said in an interview Thursday before the council meeting that his company is making progress on complying with DHH’s order and said nothing has changed as far as the company’s negotiation with Ascension.
“We’re working with the parish to come to closure on this transaction,” said Gillet, who is based in Baltimore and runs the utility founded by his father.
In an agreement previously reached with the parish, the sale close was supposed to happen within 60 days after approval from the Louisiana Public Service Commission, Gillet said. That approval happened March 23.
Samantha Faulkner, DHH spokeswoman, said the agency has turned over the information it has gathered to the U.S. Environmental Protection Agency and the state Attorney General’s Office, but she could not say if either has opened an investigation into Peoples Water.
“We’ve given them our information, and it’s in their hands,” Faulkner said.
Gillet, who declined to discuss the claims of DHH, said he has not spoken with the EPA or the Attorney General’s Office.
Editor’s note: This article was changed on April 22, 2016, to note that the discovery of the high chlorine dioxide water prompted a do-not-drink order for several days in Donaldsonville.