The latest public hearings for Ohio American Water’s (OAW) proposed rate increase invoked mixed emotions from residents.
One day prior to the Jan. 21 public hearing in Galloway, the Ohio Consumers’ Counsel (OCC) announced OAW had dropped the plan to use a four-year step increase of rates for consumers in 2011, 2012 and 2013.
Despite the dropped step increases, OAW is still asking for a rate increase for 2010, which was the main concern of consumers testifying at the public hearing.
OAW is still asking for a rate increase of 26.44 percent for 2010, according to Matt Butler, communications chief of the Office of Public Affairs at Public Utilities Commission of Ohio (PUCO).
“That was part of the original request and then there would have been subsequent increases. They wanted the big increase on the front end,” Butler said.
OAW President Dave Little said the removal of the step increase was a direct result of the recommendations of the OCC and PUCO.
Removal of the steps does not mean the rates will stay the same over the next four years.
“As soon as their case is complete and the new rate would go into effect, the company could ask for another increase,” said Butler.
OAW’s manager of external affairs, Mary Beth Johnson, confirmed the company is still asking for a rate increase this year, and she had no further information on future rate increases.
“We are not looking that far ahead right now,” said Johnson.
Consumers like Richard Whitman, who lives in Darby Estates, stood to voice complaints at the public hearing about the utility company’s rates and water conditions.
His statement and others go on the record to be used for examination of the rate case by the Public Utilities Commission of Ohio (PUCO).
“In 35 years I have replaced at least six water tanks. I spent hours going through the lower hold of the hot water tank taking sediment out of the base of the tank...I removed at least a 5 gallon bucket of sediment every time. We pay $120 to $140 a month on water and sewer,” said Whitman.
Other residents testified in regard to the effect the water rates have on the resale value of their homes.
“We’ve had our house on the market two different times for periods of eight and nine months. A lot of people were interested in the house. They love our house, but when they hear about the water company they just turn their backs and walk away,” said Burle Shaw of Galloway.
Johnson said rate increases are necessary for making improvements.
“We don’t want to raise rates and we understand our customers don’t want to make higher payments, however in order to make improvements in the system we have to spend the money. We have to make investments in the system,” said Johnson.
Prairie Township Fiscal Officer Dan McCardle also testified, stating his water bills are $135 a month compared to his gas bill of $65 a month and his electric bill of $108 a month.
“It is mind boggling to be paying substantially more for water and sewer compared to other utilities,” said McCardle.
“We listen very carefully to what the customers have to say. When there are problems that arise that need to be addressed, we get in contact with those customers individually to see what we can do to assist,” said Johnson.
Many consumers who testified expressed a desire to have Columbus city water.
In response, Little said the comparison presents a huge inequity because the Columbus water utility service does not have to pay the property taxes OAW does.
“The only way we can recover what we spend is to get it from our customers. That is the way regulated companies work,” said Johnson.
According to PUCO staff findings, “OAW should change its business model to better control costs and to better reflect economic conditions in the market it serves. OAW costs have reached a critical point where major processes should be altered and institutional changes implemented.”
“Hopefully this case sends the message to the company that we are not going to take it anymore,” said Prairie Township trustee Steve Kennedy.
At the conclusion of the public hearings, PUCO will examine the testimony and issues an order, which is scheduled to occur in March. Applications for a rehearing can be filed in April, and decisions in regard to those applications will be made in May.
Additional information can be found at www.fightthehikeohio.com.