Pittsburgh Water adopts $1.2 billion capital plan following historic asset transfer

Pittsburgh Water adopts $1.2 billion capital plan following historic asset transferThe authority enters 2026 with ownership of its systems secured and a massive investment program targeting lead line removal and pump station upgrades, supported by significant state funding.

Board approves 2026–2030 Capital Improvement Plan totaling $1.2 billion.

Authority officially takes ownership of water and sewer assets from the City of Pittsburgh after years of leasing.

CEO Will Pickering confirms the utility is on track to replace all residential lead service lines by 2027.

New PENNVEST surcharge mechanism included in pending rate case settlement to cover debt service.

Major $200 million 'ABC' project for pump station and Clearwell bypass work moves forward.

The Pittsburgh Water and Sewer Authority (Pittsburgh Water) has approved a $1.2 billion Capital Improvement Plan (CIP) for the period of 2026–2030, coinciding with a historic shift in the utility’s structure: the official transfer of water and sewer assets from the City of Pittsburgh to the authority. During the December 19, 2025, regular board meeting, Chief Executive Officer Will Pickering announced that the authority had filed the necessary signatures to finalize the asset transfer. This move replaces the previous 30-year lease agreement with the city. The transfer is currently under a 30-day review by the Pennsylvania Public Utility Commission (PUC). “This is the logical and anticipated next step of the 30-year lease agreement that the authority struck with the City of Pittsburgh,” Pickering said. **Capital Planning and Budget Approval** The board adopted Resolution 108, approving the 2026–2030 CIP, which represents a slight increase over the previous plan. Finance Director Ed Barca noted that the authority’s 2026 operating budget anticipates $281 million in revenue, a significant increase from the $247.4 million projected for 2025. Operating expenses for 2026 are budgeted at $170 million, with debt service costs rising to $104.3 million. A key component of the authority’s financial strategy involves the Pennsylvania Infrastructure Investment Authority (PENNVEST). Barca reported that since 2018, Pittsburgh Water has secured approximately $800 million in low-interest loans and $110 million in grants from the state infrastructure bank. The authority’s pending rate case settlement includes a new PENNVEST surcharge mechanism. If approved by the PUC, this will appear as a specific line item on customer bills dedicated solely to covering debt service for PENNVEST-funded capital projects. “This is a very large revenue source that you’ll see in 2026 and forward as we continue to ramp up efforts on our capital program,” Barca told the board. **Project Highlights: Lead and Pump Stations** The capital program continues to prioritize the removal of lead infrastructure. Engineering officials reported that the authority has replaced over 14,000 public lead service lines to date and remains on track to replace all residential lead lines by 2027. The board approved new borrowing resolutions totaling over $27.7 million from PENNVEST to fund the 2025B Neighborhood Lead Service Line Replacement Project. This financing taps into a robust state-level funding environment; in 2025 alone, PENNVEST allocated record amounts to water systems across the commonwealth, supporting similar large-scale lead replacement efforts by Pennsylvania American Water and the West View Water Authority. Major facility upgrades are also underway. Pickering highlighted the substantial completion of the Highland Reservoir Pump Station, delivered ahead of schedule and under budget. Attention now shifts to the “ABC Project”—the Aspinwall Pump Station, Bruecken Pump Station, and Clearwell Bypass. This approximate $200 million investment is required to address consent decree obligations and replace aging infrastructure crucial to the distribution system. **Regionalization and Stormwater** The board also authorized continued negotiations with the Allegheny County Sanitary Authority (ALCOSAN) regarding the potential transfer of trunk sewer assets. This “regionalization” effort involves evaluating the transfer of sewers larger than 10 inches in diameter to ALCOSAN to assist in regional combined sewer overflow mitigation. Rachel Beam of the Engineering Department noted that while progress is being made, the transfer involves complex discussions regarding asset condition and upgrade costs. Despite the approval of the capital plan, the meeting featured public comments criticizing the level of investment in stormwater management compared to other priorities. Speakers expressed concern that projects identified in the Stormwater Strategic Plan, such as the Four Mile Run project, were not sufficiently prioritized in the budget. In response, Board Chair Shuley acknowledged the complexity of the issue, citing the need to balance stormwater investments with the consent order requirements and the ongoing ALCOSAN regionalization work to ensure ratepayers are not charged twice for the same service. “Stormwater is a priority of Pittsburgh Water,” Shuley stated, “but it is complicated.”