P&G Caught in a 400-Year-Old Feud Over Potomac River Rights
November 23 2016 - 05:59AM
Dow Jones News
By Sharon Terlep
A nearly 400-year-old fight over water rights is coming to a
head along the banks of the Potomac River -- and pulling consumer
products giant Procter & Gamble Co. into the fray.
West Virginia is threatening to sue Maryland if the state
refuses to grant the mountain state unfettered access to water in
the Potomac River, a portion of which defines the border between
the two states.
West Virginia needs the water to support a $500 million
manufacturing plant that P&G plans to build on its side of the
Potomac, roughly 25 miles from historic Harpers Ferry. P&G
bought the 450-acre site in 2014 and has started construction on a
facility that will start making Pantene shampoos and Old Spice body
wash in 2018.
In a Nov. 2 letter to Maryland officials, West Virginia Attorney
General Patrick Morrisey said the water treatment facility that
will supply water to the P&G factory "has an urgent need" to
increase capacity beyond limits imposed by Maryland.
He argues that Maryland's control over the Potomac River water
is limited by an 1785 compact negotiated by George Washington, four
years before becoming the first U.S. president, as well as a 2003
U.S. Supreme Court decision. Disputes over the river date back to
the 1600s when Virginia and Maryland were both British colonies and
West Virginia wasn't yet its own territory.
The office of Maryland Attorney General Brian Frosh said this
week it is preparing a response and declined further comment.
The move alarmed locals, who are counting on the factory to
bring 700 jobs to the region, and sent P&G scrambling to
contain the fallout.
On Tuesday, P&G said it has recently been reassured by
officials in the county where the plant will be located that there
will be adequate water for the factory and construction on the
plant remains on track. Doug Copenhaver, president of the Berkeley
County Commission, on Tuesday said the county has enough water to
meet P&G's needs even if the state fails to win rights to draw
more water from the Potomac.
The county water treatment plant is authorized to draw four
million gallons a day from the Potomac. It currently draws 2.4
million and the P&G plant will require an additional 1.3
million, he said. The plant can also use other water sources within
the region. "We have plenty of water, " Mr. Copenhaver said.
A spokesman for West Virginia Attorney General said the P&G
factory will result in additional residential and industrial
development that will push the county over the four million gallons
a day it currently draws from the river.
The flare up, in a sleepy but fast-growing part of West Virginia
famous for white-water rafting and Civil War history, is the type
of skirmish increasingly common in Western states as rural and
urban interests squabble over a resource diminished by drought and
strained by a growing population. Water isn't so scarce in the
mid-Atlantic, but growth in West Virginia combined with sprawl from
Virginia and Maryland suburbs of Washington, D.C., has made water
access more of an issue.
Maryland officially began regulating access to the Potomac in
1933 when it implemented a permit process for entities outside the
state wishing to draw from the Potomac, said Adam Van Grack, a
Maryland attorney who has litigated numerous disputes involving
access to the region's rivers. The state approved all requests
until the 1990s when it started to turn some down amid rapid
development in surrounding areas, he said.
Ever since the 2003 Supreme Court ruling which granted Virginia
access to the river, "West Virginia has been waiting for a time to
raise this issue," Mr. Van Grack said. "This plant is the straw
that broke the camel's back, and now they are asserting their
muscle over rights to the Potomac River."
Write to Sharon Terlep at sharon.terlep@wsj.com
(END) Dow Jones Newswires
November 23, 2016 05:44 ET (10:44 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
Procter and Gamble (NYSE:PG)
Historical Stock Chart
From Feb 2024 to Mar 2024
Procter and Gamble (NYSE:PG)
Historical Stock Chart
From Mar 2023 to Mar 2024