IURC Approves Emergency Water Rate Increase

INDIANAPOLIS – The Indiana Utility Regulatory Commission (IURC) today approved the Indianapolis Department of Waterworks’ request for an emergency rate increase. The IURC authorized Waterworks to raise water rates by 12.27 percent. For the average household using 7,000 gallons of water per month, the bill impact for the emergency rate increase will be about $3 per month. The average monthly Indianapolis Water bill will now be about $28.

Because of the financial market crisis of 2008, Waterworks’ interest rates on its variable-rate debt increased dramatically. Interest rates rose from 3.5 percent to 9.5 percent, forcing Waterworks to make $25.9 million more in debt service payments in 2008 than in 2007.

“Although we needed the requested 17.5 percent increase, we respect the IURC’s decision and now are focusing our attention on complying with the IURC’s order,” said Matthew Klein, executive director of the Department of Waterworks.

As part of the pending rate case, Waterworks also has petitioned the IURC for a general rate increase to continue Waterworks’ 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 rate increase amount is yet to be determined. The general rate case will likely take 12-18 months for approval, and could impact customers’ water bills as early as the late summer of 2010.

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.


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