Residents can comment Thursday on proposed water rate hike

Herald Staff Report

June 01, 2009 10:21 am

— CLINTON — The Iowa Utilities Board will hold two public comment meetings for customers of Iowa-American Water regarding the utility’s request to increase its rates.
Customer comment meetings are typically the only verbal opportunity to provide comments directly to the board and other parties in a rate case. Customer comment meetings are planned for Thursday at 5:30 p.m. at Clinton Community College Technology Center, Room 10, 1951 Manufacturing Drive; and in Bettendorf at 5:30 p.m. June 11. That meeting will be at Scott Community College Student Life Center, Room 2300, 500 Belmont Road.
On April 30, Iowa-American filed a proposal for an overall permanent annual revenue increase of approximately $9.4 million, which is a 34.8 percent increase. The company also asked for a temporary rate increase while the case is pending, which could generate an estimated $7.9 million over one year, according to the Iowa Utilities Board. Temporary rates should be determined by July 29. If permanent rates are ultimately established that are less than temporary rates, customers will receive a refund plus interest for any over-collection.
At public comment meetings, verbal questions and comments may be directed to representatives of the IUB, the Office of Consumer Advocate, which represents the general interests of customers in IUB proceedings, and Iowa-American. All comments provided will become part of the permanent record in this rate case.
The board’s decision on permanent rates in this case is anticipated by March 1, 2010.
The IUB is also accepting written public comments in this rate case, identified as Docket No. RPU-2009-0004. The most effective written comments are concise and make specific points about why someone supports or objects to the rate request, IUB officials note. More information about this rate case and an electronic comment form is available at www.state.ia.us/iub. Written comments may also be mailed to the Iowa Utilities Board, Executive Secretary, Docket No. RPU-2009-0004, 350 Maple Street, Des Moines, IA 50319-0069.
In its Clinton and Quad Cities Districts in Iowa, Iowa-American serves approximately 60,000 customers.
According to a summary of rate request filed April 30, the full residential monthly bill increase sought is $7.44 in the Quad-Cities and $17 in Clinton.
More about the meeting
A member of the Iowa Utilities Board will preside over the meeting. After introductions and opening comments by the IUB, representatives of Iowa-American Water Company and the Office of Consumer Advocate may provide brief remarks. A court reporter will transcribe this public comment meeting for the record. Next, the IUB will open the meeting to comments from the audience. The exact process will be explained and may be adjusted to suit the size of the audience and meeting facilities. It may be necessary to impose time limits to allow everyone to speak.
To speak, you must come to the designated location and use the microphone. State your first and last name and spell your last name for the court reporter. You may make comments or ask questions relevant to this rate request. In the interest of making sure everyone has an opportunity to speak, IUB officials ask that comments be focused on this rate case and to the point. When you are finished speaking, please step aside so the next person can speak.
The Iowa Utilities Board and Utility Rate Regulation
The Iowa Utilities Board is an independent quasi-judicial regulatory board of three members, each appointed by the Governor to staggered six-year terms. The appointments are subject to confirmation by the Iowa Legislature. No more than two board members may be from the same political party. The decisions of the board may be appealed to the courts for judicial review.
Participants in a rate proceeding include the three-member Iowa Utilities Board, the Office of Consumer Advocate, which represents general customer interests, and the utility requesting the rate change. There may also be intervenors in the case such as other utilities, customer groups, or other public groups that have an interest in the outcome of the case.
The Office of the Consumer Advocate was created in 1983 to represent the general customer interests in rate cases and other proceedings of the IUB. In rate cases, the OCA does not represent any individual customer or specific class of customers, but examines the rate proposal to determine the justification and propriety of the request. The OCA may cross-examine witnesses in the case and may present its own expert witnesses to support its position. The OCA is a division of the Iowa Attorney General’s office.
The Obligation of the Board under Iowa law is to ensure “the charge made by any public utility … for any service rendered … shall be reasonable and just, and every unjust or unreasonable charge for such service is prohibited … the board shall consider all factors relating to value.”
Temporary rates may be sought by the utility under Iowa law, to become effective while the decision on permanent rates is pending.
The amount of the temporary increase must be based on specific criteria and principles of law that are stated in the Iowa Code. If the final rate approval is lower than any temporary rates established, the over-collection is subject to customer refund with interest.
The rate-making process begins with a rate-regulated utility notifying customers of its proposed rate changes at the same time it files a formal petition with the IUB. The board then adopts a procedural schedule that may take up to 10 months. The process generally includes an opportunity for public input, the filing of written testimony and cross-examination of that testimony at an evidentiary hearing, and the filing of legal briefs.
Although it is open to the public, participation in an evidentiary hearing is usually limited to the board and parties of record in the case.
Public comment meetings are the appropriate venue for customers of the utility to speak to the rate request.
Rate case considerations for the board include a review of the utility’s revenue requirement to cover the costs of general operating expenses, new capital expenses, cost of debt, and a reasonable return on investment necessary for the utility to provide efficient and reliable service.
Only evidence in the record for this case may be considered in the decision.

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