CHESTER, PA — The state-appointed Receiver for the City of Chester filed a Recovery Plan Modification in Commonwealth Court on Tuesday, seeking greater oversight of the Chester Water Authority (CWA) following its announcement of a 14 percent rate increase and to challenge what the filing describes as an unconstitutional governance structure.
The action, filed under Pennsylvania’s Act 47 program for financially distressed municipalities, requests that the court compel CWA to provide detailed financial information explaining the rate hike set to take effect January 1, 2026. The filing also asks the court to reconstitute the authority’s board so that all five members would once again be appointed by the City of Chester, restoring the city’s original governance rights that were altered by a 2012 state law.
Receiver Vijay Kapoor said the filing is intended to increase transparency and protect residents during the city’s ongoing bankruptcy proceedings. “The public deserves clarity,” Kapoor said. “A financial review will help everyone understand what is driving this increase, whether costs are being appropriately managed, and how to protect the long-term value of the system for customers and for the City.”
The Receiver’s office emphasized that the modification does not attempt to block the rate adjustment but aims to ensure accountability and preserve the value of a major public asset.
At the heart of the dispute is the 2012 amendment to state law that expanded the CWA board from five to nine members—three each appointed by Chester, Delaware, and Chester Counties. The Receiver argues that the change, enacted under Act 73, amounted to unconstitutional “special legislation” because it applied uniquely to Chester and its water authority. The statute’s narrowly defined criteria—covering authorities serving at least two counties and having water projects in more than two—fit only CWA, whose Octoraro Reservoir extends slightly into Lancaster County.
“The Pennsylvania Constitution requires like entities to be treated the same,” Kapoor said. “The 2012 change carved out a one-off governance model for the Chester Water Authority that does not exist anywhere else. Returning to a standard, lawful structure clarifies accountability, stabilizes governance, and puts to rest needless uncertainty around control.”
If the court accepts the modification, it could order a hearing within 30 days and must confirm the plan within 60 days unless there is clear and convincing evidence that the proposal is arbitrary or inadequate.
The move marks the latest step in Chester’s broader fiscal recovery efforts under Act 47, which grants the Receiver authority to intervene in municipal entities when necessary to safeguard public assets and promote long-term stability.
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