PSC approves McDowell district takeover of Gary water operations

The McDowell County Public Service District is now responsible for running Gary’s water system, a change meant to put one local operator in charge of a utility that has left customers dealing with dirty water, long boil water advisories and widespread loss inside the system. The Town of Gary still owns the utility, but the Public Service Commission’s approval means the PSD now handles day-to-day operation and management.

The commission approved the operation and maintenance agreement on May 13, after the deal was filed on March 13 and moved through public comment and evidentiary hearings on March 19. An administrative law judge issued a recommended decision on April 20 in case No. 25-0611-W-DU, and the commission adopted that decision. For Gary households, the practical shift is that the PSD now carries the responsibility for routine service decisions, repair coordination and system management while the town continues to seek money for major refurbishment.

The PSC said the system’s troubles were severe enough to justify intervention. In its findings, the commission cited annual reports showing that 90% to 94% of the water produced was being lost before it reached customers. That level of nonrevenue water points to deep problems with leaks, pipes, tanks, billing or some combination of all three. Separate reporting tied PSC documents to lead in the water, corroded pipes, structural issues, exposed wiring and poor monitoring, a list that helps explain why the system has struggled to deliver basic service.

The case began in August 2025 after complaints about water pollution and extreme water loss. By March, residents were airing those concerns in Welch, where testimony described filthy-looking water and health problems, including damage to laundry and skin irritation. Officials said improvements could take years and cost millions, and one report described 60-year-old tanks as part of the collapse in service. Another report said full cleanup and repair could take up to 10 years.

The PSC also ordered a similar agreement in February for Gary’s 356-customer sewer system, signaling that the town’s water and sewer troubles are being handled as one long repair project. The PSD must file status reports every 60 days, giving residents a regular benchmark to judge whether the takeover is producing more than paperwork. The clearest signs of progress will be fewer boil water advisories, lower water loss, visible repairs to tanks and pipes, and faster answers when service breaks down in Gary and the surrounding McDowell County neighborhoods that depend on the system.