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2006 Water Rates News


December, 2006

Phony water bills grab residents' attention

David Bauder was in for a surprise when he opened his water bill from Croton-on-Hudson, NY Village Hall over the weekend.

"When I opened it up, I got a bill for $1,096.45, for a bill that usually runs $150," said Bauder, an entertainment writer. His first thought was that his water system had sprung a massive leak somewhere underground and that he was looking at an expensive plumbing job on top of a whopping water bill.  But it turns out the inflated bill was just a technique used by the village to get Bauder's attention - an "eye-opener," in the words of a village official.  Bauder had not responded to earlier requests from the village to set up an appointment to install a new high-tech water meter that can be "read" via radio signals by a village staffer driving by his home. So a bill with an inflated sum, a random figure, was sent to him and 33 other accounts. "They got my attention, but I think it was pretty obnoxious the way they went about it. Sending out a fraudulent bill a week before Christmas - it's outrageous," he said. "I wonder how someone on a fixed income or an elderly person, how they'd receive it," he said. "A cruel hoax."  Village staff say the inflated bill followed a practice that has been used by the village before, and in other communities.  Journal News _12/21/06

California Public Utilities Commission unanimously approves graduated rate increases for customers of California American Water

Beginning Jan. 1, consumers will pay a surcharge on their bills of 4 percent which will rise to 7 percent on July 1. On Jan. 1, 2008, the surcharge will go to 10 percent and remain there until the full $2.9 million in preconstruction costs for the Coastal Water Project -- $1.3 million for public outreach and $1.6 million for project management -- is recovered. Thursday's surcharge approval comes on the heels of a 20 percent general rate increase approved by the PUC last month. That increase covered all rates, including those paid by commercial users, which tend to be higher than than what consumers pay. The 10 percent surcharge is the consumer portion of that increase. By time the 10 percent rate increase is reached, the average consumer's bill will rise from the current $31 to $34 a month, said Cal Am spokeswoman Catherine Bowie. Monterey Herald_ 12/15/06

Editor's Note: California American says it serves 600,000 California customers in 50 communities.

Detroit water customers opting out of program to help the poor pay water bills

Some community activists and members of the Detroit City Council fought with Detroit Mayor Kwame Kilpatrick’s administration earlier this year over a proposed water rate increase.
Council approved the rate hike only after the Administration agreed to pursue a so-called water affordability plan for low-income residents. At one point as many as 45-thousand water customers had not paid their bills. A plan to help low-income residents asks other customers to pay an extra 50 cents to a fund for the poor. But about 35-thousand customers have reportedly opted NOT to donate to the plan. WDET_ 10/11/06

Council backs increase in Los Angeles' water rates
The City Council on Wednesday gave initial approval to increasing water rates for Los Angeles residents and businesses by an average of 5.5%, in part to improve water quality — but not before one council member said he preferred bottled water.  The increase, 2.75% this year and the same amount next year, would add $12 to the monthly water bill for the average home by the second year, if it receives a second vote of approval from the council next week.  The council voted 11 to 0 to approve the hikes after Department of Water and Power General Manager Ronald Deaton said the $35 million that will be raised is needed to meet new water quality and security requirements, including the covering of six reservoirs.  "You have to be concerned about terrorists and the birds," Deaton said, explaining why the reservoirs must be covered.  Los Angeles Times_10/5/06

Las Vegas, Nevada water officials floating proposal for raising rates

The intent is to encourage conservation. There is no word yet on the size of the proposed rate increase. But Southern Nevada Water Authority chief Pat Mulroy says a price hike could come as early as next March. The last time the authority raised rates to boost conservation, bills went up nearly 30 percent. That was three years ago. AP/KESQ_ 9/22/06

Denver Water eyes ways to pump up revenues
The Denver Water Board on Wednesday looked at ways to raise revenues 7 percent to cover a $12.2 million shortfall next year.  Board members indicated that they are leaning toward a rate increase that would charge customers who use the most water the highest rates.  Penfield Tate, vice president, said it would give customers more control of their water bills.  Denver Water expects a $12.2 million shortfall in 2007 because of increased water conservation by customers, increased costs in running the water system and new programs.  Another approach under consideration is whether to increase the minimum meter charge from $9.15 to $9.76, or lower it to $5.98.  Under either option, customers who consume the most water would have to pay the highest rates.  Rocky Mountain News_9/14/06

Urbanization, growth lead to 8.8% rise in South Africa water prices

These factors have prompted municipalities in the interior to introduce higher water price increases due to the scarcity of water in these areas. Coastal municipalities tend to have lower water tariffs because they are near rivers. According to the report released on Friday by US-based utility cost control and consulting firm NUS Consulting, water in Johannesburg costs twice as much as in Port Elizabeth. The NUS report also attributed the high water tariffs to “huge water losses due to leakage” in many municipalities. NUS Consulting’s production manager in SA, Stephan Dolk, said water prices were likely to continue to increase faster than the inflation rate. Business Day_ 9/11/06

August, 2006

Denver Water considers rate increase, in part to off-set losses from conservation

Denver Water is considering raising 2007 water rates to cover a projected $12.2 million revenue shortfall, due in part to dwindling water sales. For the average single-family home, the rates could rise 3 to 5 percent a year, or about $9 to $15. Customers who use more than 200,000 gallons of water a year, however, could face steep increases under two of three rate plans being considered. Under one alternative, residential customers who use more than 350,000 gallons could see a 20 percent increase on their annual bills - a more than $170 jump. Denver Water, the state's largest water provider, said it is being pushed to raise rates to compensate for lost revenues as use declines. During the 2002 drought, Denver Water's 1.2 million customers cut water use 24 percent over the historical average. Denver Post_ 8/24/06

NUS Consulting Group says U.S. water rates climb even higher

The annual survey conducted by the NUS Consulting Group found that the average price of water in the United States climbed by 4.4 percent for the period of July 1, 2005 to July
1, 2006. The survey, which includes 51 water systems located throughout the
country, revealed the highest price paid was in Huntington, W. Va. at $5.61
per one thousand gallons ("KGal") while residents in Greenville, Miss.
enjoyed the lowest water price at $0.80 per KGal. The average cost of water
in the U.S. was $2.49 per KGal. Including related sewer costs, the survey
also found that the national average rose to $6.29 per KGal -- an increase
of 5.2 percent from July 2005. Some of the more notable increases in water prices were observed in Newark, N.J. (+39.9%), Albuquerque, N.M. (+21.8%), Miami, Fla. (+19.5%),
Boston, Mass. (+15.8%), San Francisco, Calif. (+14.8%) and Albany, N.Y.
(+14.6%). Most of the increases were attributable to maintenance and
construction costs, as these cities struggle to upgrade and maintain aging
water and sewer systems. Of the surveyed cities, only Portland, Ore.
(-24.6%) and Los Angeles, Calif. (-9.3%) reported water rate decreases over
the past year. NUS press release/PRNewswire_ 8/14/06

July, 2006

Illinois water company will analyze its rates
Rate payers want to compare costs of private company vs. municipality service

After initially balking at comparing its cost of operation with surrounding municipalities, Illinois-American Water Co. has hired a firm to do just that.  The company hired St. Louis investment banking firm Stifel, Nicolaus & Co. to compare rates and costs of operation at Illinois American and municipally run water services.  The announcement comes after Orland Hills village officials asked in May for data detailing the company's cost of operation so they could do a similar comparison.  Orland Hills residents served by Illinois-American Water have complained since last summer about being hit with extraordinarily high water bills. Some said neighbors served by surrounding municipalities were paying a fraction of their price for water.  The Herald News_7/25/06

New Jersey water customers staring at 83.4 percent increase

Customers of the Park-way Water Co. in Howell, New Jersey got some bad news recently when it was revealed that a judge has issued a preliminary ruling that supports an 83.4 percent increase in service rates. Representatives of Parkway Water were seeking a 105 percent increase in the rates paid by the firm's 1,800 customers in the Ramtown section of Howell.  Parkway Water Co. is a private firm based in Marlboro. Customers presently pay $2.55 per 1,000 gallons of water. If the requested increase was approved in its entirety, that rate would rise to more than $5.10 per 1,000 gallons.  New Jersey Board of Public Utilities spokesman Eric Hartsfield said that if the increase goes into effect, the average Parkway Water customer will see a hike of about $294 that will bring the annual water bill to $646 per year. Brick Township Bulletin_7/20/06

Construction engineers Black & Veatch survey finds California residential water rates up 16.7% over three years

The findings were included in the company's Enterprise Management Solutions (EMS) Division's 2006 California Water Charge Survey. The survey includes 453 cities and water districts in California and compares water rates and connection fees for residential customers. The study notes that trends of increasing water rates and connection fees can be attributed to an aging infrastructure and rising construction costs, according to Ann R. Bui, Senior Consultant with Black & Veatch. Among the study’s findings is that the average residential monthly charge, for 1,500 cubic feet of water a month, increased from $30.33 in 2003 to $36.39 in 2006. This is a total 16.7 percent increase during the three-year period. Press Release_ 7/11/06

April, 2006

North Kentucky water rates to rise

The Kentucky Public Service Commission has granted a rate increase of about 6.8 percent to the Northern Kentucky Water District. The increase will raise the quarterly bill for the average residential customer from $78.65 to $83.70, the PSC said in a news release. The water district initially asked for a total increase of $3.4 million but the commission reduced the amount to $2.3 million. It also authorized the district to issue $29 million in bonds for projects to improve and expand its system. The NKWD has about 78,000 customers in Campbell and Kenton counties. It also provides wholesale service to the Pendleton County and Bullock Pen water districts and to the city of Walton. Cincinnati Business Courier_ 4/28/06

Los Angeles Department of Water and Power outlines plans for a series of rate hikes

Officials of Los Angeles' giant utility on Saturday opened their campaign to win a water-rate increase and to reinstate a long-frozen surcharge on electricity bills. Department of Water and Power officials laid out their case for proposed hikes in water rates of 3.9%, effective July 1, and 3.5% more a year later. Even modest increases could prove a hard sell for the quasi-independent DWP, which has been under fire for large pay raises it awarded to its employees last year, and for its spending on lobbyists, a fitness center and other perks for employees. Two years ago, a coalition of neighborhood councils, a growing political force in the city, forced the DWP to scale back a proposed water-rate hike from 18% to 11%. Pressure from the city council led the DWP to table another rate hike that was scheduled to go into effect Jan. 1 and to call for the audit, by Barrington-Wellesley Group. Los Angeles Times_ 4/23/06 (logon required)

Higher water bill may be coming to Hawaii
After 10 years of no rate hikes, homeowners on O'ahu could be paying at least 23 cents more per 1,000 gallons for water by summer to cover escalating Board of Water Supply operating costs.  The last hike in 1995 set the single-family residential water service rate at $1.77 per 1,000 gallons for the first 13,000 gallons.  The existing rate was the second step in a five-year rate schedule adopted in 1994 that would have raised rates to $2.47 by 1998. The Water Board has deferred raising costs for 10 years, but could resume the schedule, starting at $2 per thousand gallons, this year.  That's one option, but the board favors another plan: a new five-year plan calling for a 10 percent to 15 percent increase the first year and declining percentage hikes in each of the remaining four years. The HonoluluAdvertiser_ 4/20/06

Water rates to rise in Detroit, Michigan, but suburbs not won over

A vote by the Detroit City Council on Friday guaranteed that city residents, like those in the suburbs, will pay more for water, but coming two days after rate hikes were approved only for the other 125 communities served, it did nothing to heal fractured feelings or quell calls for change. With two members changing their votes, the City Council passed the hikes, 6-3, during a contentious special session that seemed to satisfy no one -- neither the city residents who shouted down the members nor the suburban leaders who rebuked the council en masse after Wednesday's vote. Several suburban communities have been howling for years that Detroit overcharges them and refuses to fully disclose the reasoning behind annual increases, which this year average 5.7% for the suburbs and 5.4% for Detroit. The latest vote is not likely to affect legislation speeding through the state Legislature that would take authority of Detroit's water department away from the city and give it to a regional board. Detroit Free Press_ 3/11/06

Oregon suburbs get better offer on Portland water
The Tualatin Valley Water District, Washington County's largest drinking-water provider, has played the river card in its high-stakes negotiations with the city of Portland and won a better deal for all suburban water customers. Under the threat of its largest wholesale customer going to the Willamette River for drinking water, the city has sweetened a deal to its 19 suburban customers. Portland water managers are offering a shorter contract -- 10 years -- for slightly more money than first proposed or a 20-year deal for less than first offered. For those who take the longer deal, annual cost increases also would be less.  The deals could start taking effect over the next two years. Under either deal, all but one suburban water provider would be paying less to Portland for its Bull Run system water than they currently pay -- savings that could be passed on to customers.  Oregonlive.com_3/9/06 logon required

Water rate increases approved for Detroit suburbs only...for now

The Detroit City Council on Wednesday voted to approve 5.4% water rate increases for suburban customers of the city’s water department and postponed increasing the rates for Detroit customers.  In a 5-4 vote, the council decided to hold off increasing Detroit’s water rates until the administration presented a plan to help the city’s low-income residents and seniors pay for their water bills. The decision created an uproar among some council members who said it is unfair to raise suburban rates and not Detroit’s rate. The city's water department services 4.3 million customers in 125 suburban communities in eight counties. They provide sewerage service to 3 million people in Detroit and 76 other communities.  Detroit Free Press_3/8/06

Detroit mayor calls for council meeting on water rates

A day after the Detroit City Council rejected a water rate hike that would have paid for improvements to the city's aging water and sewer system, Mayor Kwame Kilaptrick wasted no time in bringing the issue back to the council.  On Thursday, Kilpatrick called for a special session to be held today after the council rejected 6% rate hikes that members said the city's poor people cannot afford.  Detroit Free Press_3/3/06

Pittsburgh raises water rates
The Pittsburgh Water and Sewer Authority said it will raise rates 6.7 percent as of March 1, and another 5.4 percent next Jan. 1.
The panel said a residential user who consumes 5,000 gallons of water will see a hike of about 9 cents a day, or $2.66 a month as of March. Next year's rate hike will boost the average user's bill another $2.29 a month, the water authority said.  Business Times_2/10/06

City of San Diego's financial problems mean water and sewer rate increases

In his inaugural State of the City address last night, Mayor Jerry Sanders conceded that San Diego has no choice but to raise water and sewer fees in hopes of meeting an $850 million estimate for critical upgrades to its water and sewer systems. Expenses for ongoing maintenance are not included in that figure. Sanders and city officials didn't specify the amount of those across-the-board hikes or when they might kick in. But since 2002, the average single-family residence's monthly water bill has risen 24 percent, and the average residential sewer bill has gone up 30 percent. Upgrades to the water and sewer systems have been curtailed since 2004 because San Diego can't issue bonds until three overdue annual audits are completed. The audits are stalled while city, state and federal investigators examine San Diego's financial practices and decisions to underfund its pension system. The city must raise $500 million to upgrade aging sewer pipes and pump stations to comply with court agreements and a federal mandate requiring it to reduce its historically high number of sewer spills. An additional $350 million is needed to modernize San Diego's water treatment plants and make other improvements required under a 1997 enforcement order from the California Department of Health Services. San Diego Union-Tribune_ 1/13/06


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2006 Water Rates News
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