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  • The water wars are escalating in the City of Chester’s historic bankruptcy

    The water wars are escalating in the City of Chester’s historic bankruptcy

    As it approaches its third anniversary, the City of Chester’s historic and contentious bankruptcy also may be approaching a watershed.

    In a filing Tuesday afternoon, the state-appointed bankruptcy receiver asked Commonwealth Court to rule on an issue pivotal to the city’s ability to sell water assets that are keys to Chester’s emergence from bankruptcy.

    Receiver Vijay Kapoor argued that a narrowly tailored state law passed in 2012 that wrested control of the Chester Water Authority from city government was unconstitutional.

    If the judge finds in the receiver’s favor, “It would likely resolve a lot of the legal questions,” Kapoor said.

    The water authority, which serves 46 towns in Chester and Delaware Counties and reported $51.7 million in revenues last year, is the centerpiece of the receiver’s plans of creating a regional water authority. Aqua Pennsylvania offered over $400 million for the authority four years ago. The city’s annual budget is around $65 million.

    The Environmental Protection Agency estimates that, conservatively, U.S. residents collectively spend $100 billion a year on water.

    The receiver’s office has insisted that an owner operate the water assets as a “public entity,” not beholden to stockholders.

    Kapoor said that the state law transferring control of the authority was amended at the last minute and passed without debate.

    Frank Catania, the water authority’s attorney, countered that the receiver’s office is attempting a hijacking and that the receiver and city officials are asking customers, 80% of whom are outside Chester, for a bailout.

    “It’s not like they’re losing something they had,” he said. “They never had it “

    Kapoor also asked the judge to force the authority to turn over financial documents to explain its 14% rate increase earlier this month, adding about $70 to the average annual residential bill.

    He said the authority had undertaken a costly ad campaign, presumably at ratepayers’ expense, that he said appeared to include racial overtones.

    The authority blamed the rate hikes on bankruptcy-related legal fees and lowered credit ratings.

    “We’re a water utility,” Catania said, “and we’re also fighting a war.”

    The law the receiver is challenging

    In his filing, technically a bankruptcy “plan modification,” Kapoor said the 2012 legislation was crafted specifically to refer to the Chester Water Authority and was afoul of state law.

    Rather than the five-member board appointed by the city council, it resulted in the creation of a nine-member board with only two representatives from the city and others appointed by Chester and Delaware County commissioners.

    The law applied only to an authority that serves “parts of at least two counties” and services an area ”five times larger than the incorporating municipality.”

    The authority also had to have “projects in more than two counties.” Part of the Octoraro Reservoir, from which the authority draws water, is in Lancaster County.

    When will the bankruptcy end?

    It was uncertain when the judge might rule, or when the bankruptcy — which as of the end of 2024 had cost the state $11.5 million in legal fees — might end.

    The city, which is 80% Black, has been in the state’s “distressed” status since 1995 and entered receivership in 2020.

    Kapoor’s predecessor, Michael Doweary, took it into bankruptcy in November 2022. Chester had accumulated a $48 million pension deficit and missed several years of payments.

    Kapoor has said that sale of the water assets would be critical to avoiding dramatic cuts in retirement benefits.

    Chester’s tax base has declined precipitously in the decades since the city’s wartime industrial heydays, and a casino and an incinerator are key contributors to its annual budget.

    Other cities have suffered similar economic trauma, but Chester is a rarity. Of the more than 35,000 towns in the country, only about 30 have filed for bankruptcy.

  • Chester saw one of its safest summers ever in 2025. No one died from gun violence.

    Chester saw one of its safest summers ever in 2025. No one died from gun violence.

    For five glorious Sundays this summer, there was peace in Chester.

    In places like the William Penn Homes and Chester Apartments, where children are often encouraged to stay indoors, shut away from the threat of gang violence, it was finally safe to play outside during the height of what is normally the most dangerous time of the year.

    Roving carnivals nicknamed “Sunday Fun Days” were organized and held in Delaware County’s lone city, in areas that had weathered a surge in violence in recent years. A few bounce houses, some water ice, and communities breathing sighs of relief were rewards for keeping the peace, and motivation to continue that trend.

    The parties, according to Geo Stockman, the lead gun violence interventionist with Making a Change Group, came during one of the safest summers on record in the city: Not a single fatal gunshot was fired in Chester during that time.

    It was a result that local police and county prosecutors say they have been working toward these last few years, through a combination of advocacy work and interventions by groups like Stockman’s.

    “This opened up the neighborhoods. It gave them a reason to say, ‘Let’s try something else, people are really looking out for us now, maybe we should put this down,’” Stockman said. “People are always telling people to stop doing something without offering them something in this place. So that’s what we did this summer. We offered them something in its place.”

    The block parties were a new addition to the programs offered by the Chester Partnership for Safe Neighborhoods (CPSN), an initiative launched by the Delaware County District Attorney’s Office in 2020.

    Gregory Cottman left, Gregory Graves, center, and Geo Stockman say the Sunday Fun Day block parties sponsored by the Delaware County District Attorney’s Office served as both a reward for neighborhoods that have curbed gun violence, and an incentive to continue that trend in the years to come.Jose F. Moreno / Staff Photographer

    The program takes a holistic approach to combating gun violence, targeting teens and young adults at risk of committing crimes and offering them services, mediation, or counseling before they resort to violence.

    In its five years of operation, CPSN has seen a 65% reduction in shootings overall and a 74% reduction in fatal shootings. And since the summer, only two fatal shootings have been recorded in Chester, which prosecutors say still puts the city on pace for one of its most peaceful years on record.

    “Violence comes from a place of, of hopelessness, of despair. Just anger, resentment, and feeling like you’ve been left behind, like nobody cares,” Stockman said.

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    He spoke from experience, as a lifelong Chester resident who spent time in prison for mistakes made on the streets of his hometown.

    “That’s what makes what we do so effective. Most of us want to be stopped, but nobody stops us,” he said. “Nobody takes the time to say, ‘I’m gonna be the one to calm you down.’ It really only takes somebody with a clear mind that they understand to say, ‘Nah, that ain’t it.’”

    Stockman said he and his team have successfully mediated 130 disputes between rival neighborhoods in the last two years. They settled petty arguments, usually started on social media, that were clearly heading toward a violent conclusion.

    “This is a small community, so your reputation goes further than just the neighborhood you’re from,” said Gregory “G-Code” Graves, who works with Stockman.

    Graves said the anti-violence messaging works because it’s coming from people the intended audience can identify with.

    “We’ve been through the vetting process in all these neighborhoods, so even if it’s a little hesitation at first, it doesn’t take a great deal of persuasion to get them to come to us,” Graves said. “And we come in with meaningful things that’s going to help the situation.”

    Residents of the Chester Apartments line up for water ice at a “Sunday Fun Day” block party held this summer in Chester.Courtesy Delaware County District Attorney's Office

    For District Attorney Jack Stollsteimer, those results are exactly what he envisioned when he brought CPSN to the county five years ago, building it on models used successfully in other cities, including Boston.

    And he is confident that the program will continue to thrive without him, as he runs for a county judgeship in the Nov. 4 election.

    “People have bought into the strategy. They’ve seen it work now, and they just wanna keep it going,” he said.

    Stollsteimer said making Chester safe was one of his priorities when running for district attorney in 2019. Similar programs, he said, had failed before because of a lack of buy-in from officials.

    This time was different — Mayor Stefan Roots became a fixture at the Sunday Fun Day parties.

    Roots said the weekly parties presented a rare opportunity for residents to meet the people making decisions that affect their everyday lives. And, in turn, allowed him and other officials to have open, honest dialogue with people living in communities most affected by gun violence.

    The conversation flowed naturally, he said. No pressure. No pretense.

    “This is something that’s never, never happened before,” he said. “The relationship between the city and the county is really welcome. And the results are showing themselves.”

    Roots said he lost count of how many residents came up to him at the parties to talk about their own efforts to curb violence in their neighborhoods. People, he said, who told him that the block parties, and the gun violence interventions that preceded them, were a welcome sigh of relief.

    “They told me that, sometimes, they don’t want to be ‘the man with the cape.’ They want to go on and have a life, too,” Roots said.

  • Bankrupt Prospect Medical received bids of $10 million for Crozer-Chester Medical Center and $3 million for Springfield Hospital

    Bankrupt Prospect Medical received bids of $10 million for Crozer-Chester Medical Center and $3 million for Springfield Hospital

    The winning bids at a bankruptcy auction were $10 million for Crozer-Chester Medical Center and $3 million for Springfield Hospital, owner Prospect Medical Holdings Inc. said in a court filing late Monday.

    The California for-profit, which filed for bankruptcy protection in January, identified the top bidders from Friday’s auction as Chariot Allaire Partners LLC for Crozer-Chester in Upland and Restorative Health Foundation and Syan Investments LLC for Springfield.

    Prospect did not say in its filing when it expected the sales to be finalized. Both hospitals are currently closed.

    Yoel Polack, who is in the group that wants to buy Crozer-Chester, initially declined to comment about plans for the property. “We are still working through final administrative details of the sale and will wait until next week to make any statements to the press,” he said in an email over the weekend.

    Polack is identified on LinkedIn as principal at Chariot Equities, which describes itself on its website as a real estate investment and development company. Previously, Polack worked in healthcare real estate, such as medical office buildings, at Simone Development Cos. in New York.

    Polack had an out-of-office reply on his email Tuesday, saying he would have no internet or phone access until Thursday.

    The president of Upland Borough Council, Christine Peterson, did not respond to a request for comment Monday about the winning bidder.

    No definitive information was available on Restorative Health Foundation and Syan Investments.

    A phone number registered under the name Restorative Health Foundation in Philadelphia led to a home care agency called Restorative Home Care. The person who answered the phone Tuesday said she knew of no connection to a bid for Springfield Hospital. Another number for Restorative Health Foundation had a voicemail box that was full.

    Restorative Health and Syan also participated in the Crozer-Chester auction, driving the winning bid up to $10 million from Chariot Allaire’s original $7 million offer. They were identified as the backup bidder for Crozer-Chester, in case Chariot Allaire doesn’t complete the purchase.

    At Springfield, KQT Aikens Partners 2 LLC is the backup buyer. That involves the same group of local investors that bought Taylor Hospital for $1 million last month.

    Prospect shuttered Crozer-Chester this spring, following the failure of government-led efforts to find a new, nonprofit owner. It had closed Springfield in 2022.

  • Prospect gets OK to ‘abandon’ Crozer-Chester Medical Center and Springfield Hospital if sales don’t go through

    Prospect gets OK to ‘abandon’ Crozer-Chester Medical Center and Springfield Hospital if sales don’t go through

    Prospect Medical Holdings Inc. had a $7 million bid for Crozer-Chester Medical Center and a $3 million bid for Springfield Hospital ahead of an auction held in the afternoon, an attorney for the bankrupt company said at a hearing Friday.

    Neither the winning bidders nor the top bids were identified publicly after the auction. Prospect did not respond to a request for information about the prospective buyers. Community members have been pushing for the restoration of hospital services to Crozer-Chester in particular.

    At the same hearing, U.S. Bankruptcy Judge Stacey Jernigan approved Prospect’s plan to “abandon” the two shuttered Delaware County hospitals if the sales fail to close promptly because the properties have become a financial burden to the bankruptcy estate.

    Prospect used a similar tactic last summer in the case of Crozer Health’s two other closed hospitals, Delaware County Memorial Hospital in Drexel Hill and Taylor Hospital in Ridley. Both of those hospitals have since been sold.

    In a court filing Friday morning, Prospect said it had reached agreements with local tax authorities to set the assessments on Crozer-Chester and Springfield at the sale price for this year and next year.

    The properties had elevated assessments because of Prospect’s financial maneuvers since the California for-profit acquired the county’s largest health system in 2016. The current assessment on Crozer-Chester is $114.6 million, according to public records. That figure is $10.9 million for Springfield

    The filing also said school districts and others would accept general unsecured claims in the bankruptcy. Those claims are unlikely to have much value.

    Much of Friday’s hearing on the abandonment motion was taken up with discussion of complications at Springfield. An attorney for Springfield Township said his client had not agreed to the tax deal outlined in the abandonment motion and was not part of the discussions.

    That’s because Springfield Township has not filed a bankruptcy claim for back taxes, according to Prospect’s attorney, Maegan Quajada, of Sidley Austin. A hurdle in any sale is a deed restriction on the Springfield property that requires the operation of an emergency department that is open all the time.

    However, Prospect closed the Springfield Hospital emergency department in early 2022, so it’s not clear how much weight the deed restriction has.

    When Prospect announced late last month that it would hold an auction for Springfield and Crozer-Chester, it said any bids had to have no conditions on them, such as the resolution of tax matters or the Springfield deed restriction.

    But then Prospect changed its mind and accepted conditional bids and rejected one that was unconditional, an attorney said in court Friday.

    Quajada said the unidentified contingencies are being taken care of. “We already know we can meet them,” she said.

  • Crozer-Chester Medical Center and Springfield Hospital would be ‘abandoned’ under Prospect Medical bankruptcy motion

    Crozer-Chester Medical Center and Springfield Hospital would be ‘abandoned’ under Prospect Medical bankruptcy motion

    Prospect Medical Holdings Inc. said in an emergency bankruptcy motion Friday evening that it wants to “abandon” Delaware County’s Crozer-Chester Medical Center and Springfield Hospital unless local authorities agree to its property tax demands.

    The California for-profit, which filed for bankruptcy in January, said it has potential buyers for the properties in Upland Borough and Springfield Township, which were once part of Crozer Health, the county’s largest health system and an important safety-net provider.

    However, the bidders won’t close the deals unless tax assessments on the properties are reduced to the amount of the sale prices, Prospect said in its motion. The filing did not say what bids Prospect had received or how much Prospect owes in taxes. The assessments have been in dispute for years.

    If U.S. Bankruptcy Judge Stacey Jernigan approves the motion at a hearing scheduled for Friday, Prospect would be allowed to jettison the properties from the case and stop the accumulation of property tax liabilities against the bankruptcy estate.

    Then, if the tax authorities still do not agree to Prospect’s demands, the only way the municipalities and school districts could collect at least part of what they are owed would be to foreclose on the properties and put them up for a tax sale — a process that could take years.

    Prospect had said previously it planned to hold an auction Oct. 10 for the Crozer-Chester and Springfield properties. It’s not clear if that plan has changed.

    Prospect’s replay of earlier tactic that worked

    In July, Prospect received court approval to abandon two other shuttered Crozer hospitals, Taylor Hospital in Ridley Park and Delaware County Memorial Hospital in Drexel Hill. Those two hospitals have since been sold.

    Upper Darby School District acquired Delaware County Memorial for $600,000 on Aug. 14 and plans to use the property for the expansion of its neighboring high school. A group of local investors bought Taylor for $1 million Sept. 5 and hope to bring medical services back to the building.

    In both of those cases, the townships and school districts accepted a general unsecured claim for past property taxes. The assessment issue was moot in Drexel Hill, but in the Taylor sale the taxing authorities agreed to a $1 million assessment for the first year or so.

    Complications in Springfield

    The Springfield property has a complicated ownership structure. Ventas, a large real estate investment trust, owns three of the buildings, two medical office buildings, and a sports club that is leased to the YMCA of Eastern Delaware County. The sale of those buildings happened in 2009, seven years before Prospect acquired Crozer.

    The hospital and a parking garage were part of the 2019 sale of Crozer real estate to a different investment firm, Medical Properties Trust. Under that arrangement, Prospect leased Springfield and other hospitals back from Medical Properties Trust.

    After Prospect’s financial condition deteriorated, MPT returned ownership of the Delaware County hospitals to Prospect in exchange for a mortgage. That happened in 2023. During the bankruptcy, MPT agreed to walk away from its interests in Crozer’s real estate.

    Prospect failed for years to maintain the hospital and its parking garage, according to a lawsuit filed in mid-September by Springfield Township. The lawsuit cited the potential structural failure of stairwells in the garage and other problems and asked for an order forcing safety improvements.

    Judge Jernigan blocked the township from pursuing that lawsuit last week.

    Another sticking point in Springfield is a deed restriction requiring the operation of a 24-7 emergency department on the site.

    Representatives for Springfield Township and Upland Borough did not respond to requests for comment Saturday.