Published: May 04, 2009 09:42 pm         

Increase in water rates may be on tap

Indiana American Water customers could be looking at $150 more a year

TERRE HAUTE — Indiana American Water customers in Terre Haute and in the Wabash Valley would pay an average of $150 more per year if a rate increase petition filed by the company last week with the Indiana Utility Regulatory Commissioner is approved.

The nearly 39 percent rate increase, at $12.51 per month for a residential customer using 6,000 gallons per month, would increase the average bill to $44.62 from $32.11.

The rate increase covers about 30,000 households or 82,000 people in Terre Haute, Sullivan and Farmersburg. Indiana American Water also supplies bulk water to Riley and the Sullivan-Vigo Water Corp.

Indiana American officials say the company has invested nearly $12.6 million in the Wabash Valley in the past two years for improvements, including more than $8.7 million to replace or relocate water mains. Nearly $3.6 million has been spent to install new meters and service lines, and more than $180,000 to upgrade pumping and treatment facilities, said Joe Loughmiller, company spokesman.

“We will have invested about $198 million statewide” between January 2007 and June of this year, Loughmiller said.

“About 70 percent of this particular rate case is related to capital investment, but there are also other factors such as rising expense for fuel and energy, and our cost of chemicals has nearly doubled since our last rate case.”

Indiana American Water’s last rate increase was approved in October 2007, with a statewide increase of 9.9 percent, said Danielle Dravet, spokeswoman for the Indiana Utility Regulatory Commissioner. For the company’s Wabash Valley operations, the 2007 increase was 10.1 percent, Loughmiller said.

In 2007, the water company sought a 17.7 percent increase in the Wabash Valley, or a $4.93 rate increase. The IURC approved $2.80 per month, or a 10.1 percent increase, Loughmiller said.

In its rate increase petition, filed April 30, Indiana American Water seeks to have a 12-month period that ended Nov. 30, 2008 used as the testing period to determine the company’s operating expenses. Capital expenses would be considered from January 2007 to June 30, 2009, Loughmiller said.

Statewide, the water rate increase is 28.86 percent for 283,000 water connections, servicing about 1.2 million people, Loughmiller said.

Anthony Swinger, spokesman for the Indiana Office of Utility Consumer Counselor, which represents Indiana citizens in utility rate cases, said a rate increase typically takes 12 to 18 months to complete.

The next step will be to establish a procedural schedule for hearings and filings. “We will then review the information and evidence that Indiana American Water will be filing in the case,” Swinger said.

“Our job is to represent the interest of all rate payers and we will give the proposal by Indiana American a thorough review from an accounting standpoint, engineering, economic and legal standpoint and then file our recommendation” with the IURC, Swinger said.

Indiana American Water, a wholly owned subsidiary of American Water, is the largest investor-owned water utility in Indiana, providing water and/or wastewater services to more than 1.2 million people.

American Water is the largest investor-owned U.S. water and wastewater utility company, providing drinking water, wastewater and other related services to approximately 15.6 million people in 32 states and Ontario, Canada. More information can be found at www.amwater.com.

Howard Greninger can be reached at (812) 231-4204 or howard.greninger@tribstar.com