Friday, September 25, 2009

Waterworks Director Can't Explain Additional Rate Increase Request

WRTV's Joanna Massee asks a simple question of Department of Waterworks Executive Director Matt Klein about why Indianapolis water users should be expected to pay for another water rate increase after the IURC gave approval to an 11% increase earlier this summer. Massee interviewed me for her story today, and I explained to her that the department was not doing its part at cost reductions before asking ratepayers to dig deeper into their pockets. Klein claimed vendors are helping with cost reduction, although he didn't elaborate on those efforts. His only consolation to ratepayers is that customers would be facing even higher rates if the water company wasn't doing such a good job at cost cutting. Massee asked of Klein, "Should customers have to expect to pay more and more to get the department out of the hole?" His answer: "The customers should expect that the utility is a well-run operation and that the water company has the managerial, technical and financial capability to run this utility and that's what our team is doing." Pressed further by Massee, Klein says the additional rate increase, which he would not specify the amount of at this time, was necessary to fund federally-mandated capital improvements. As I've previously written about, the IURC determined in its order allowing the 11% increase earlier this summer that these capital projects could not be substantiated. The IURC criticized the water company for failing to make cost reductions. It was particularly critical of its one-sided agreement with Veolia to manage the water company, an agreement the IURC described as "profoundly disturbing."

1 comment:

Elizabeth said...

Interesting to note that several area utilities have offered to partner with IWC to reduce their required capital improvements, and IWC has ignored those proposals. I would think a regional partnership approach would be preferable to going it alone and soaking the IWC ratepayers for the cost.