News & Events
Waterworks Board adopts resolution authorizing water rate increase request
Thursday, February 19, 2009
Contact: Jo Lynn Garing, Department of Waterworks 317-263-6398
INDIANAPOLIS – The Indianapolis Department of Waterworks Board of Directors approved a resolution authorizing the Department of Waterworks (DOW) to petition the Indiana Utility Regulatory Commission (IURC) for an increase in water rates.
The rate petition has two parts: an emergency rate increase and a general rate increase. The emergency rate request will be an approximate 17.5 percent increase. For the average household using 7,000 gallons of water per month, the bill impact for the emergency rate increase will be about $4.50 per month. The average monthly water bill is about $25.
Emergency rate increase
Because of the financial market crisis, Waterworks’ interest rates on its variable rate debt have increased dramatically. Interest rates rose from 3.5 percent to 9.5 percent, forcing Waterworks to make $20 million more in interest payments in 2008 than in 2007. About 57 percent of Waterworks debt is held in variable rate bonds. The additional revenue provided by the rate increase would help stabilize Waterworks’ financial situation. The emergency rate increase would likely impact customers’ water bills during the late spring of 2009.
General rate increase
At the same time as the emergency rate petition, Waterworks also will petition the IURC for a general rate increase. Waterworks always had anticipated making a general rate increase petition this summer. Waterworks has moved up this petition to coincide with the emergency rate petition. Currently, Waterworks is analyzing financial information and capital projects to determine the specific general increase it will ask for from the IURC.
The additional revenue generated from the general rate increase will allow Waterworks to continue its investment in the drinking water system by completing mandatory upgrades to its surface water treatment plants, extending water service to underserved areas and increasing water supply. The general rate case will take 12-18 months for approval, and could impact customers’ water bills during the first quarter of 2010. Waterworks will file the petition next week with the IURC.
The Department of Waterworks is governed by a 7-member bipartisan board of directors. The department owns and manages Indianapolis Water, which serves about 1 million people in Central Indiana, and contracts the system’s operation to Veolia Water Indianapolis.
Click here to compare Indianapolis Water rates to others in central Indiana (numbers reflect water usage only, and do not include user fees related to sanitary sewer service).
