The Fayette Tribune, Oak Hill, W.Va.

June 24, 2013

Seniors speak out against proposed water rate hikes

By C.V. Moore
Register-Herald Reporter

FAYETTEVILLE — Fayette County residents, especially seniors, say that two rate hikes proposed by West Virginia American Water (WVAW) could put them over the edge financially.

But the utility company says it is just recovering costs.

“With all the different increases with the electric and all the other utilities, and as small as my Social Security check is, I barely have enough left over for anything,” says Jean Dixon, an 81-year-old widow.

She spoke at a hearing Wednesday in Fayetteville hosted by the Public Service Commission (PSC) to gather comments about two proposed rate hikes.

WVAW wants to increase Fayetteville’s sewer rates by 63 percent, which would raise the average residential customer’s bill from $36 to $59 per month.

The company is also asking the PSC for a 20 percent water rate increase for its 171,000 customers statewide, increasing the average residential customer’s bill by over $8, to $47.

Many others in the room on Wednesday echoed Dixon’s statement and worried about their ability to cover basic needs on a fixed income. The rate increases, they said, are not affordable.

The 30 in attendance were largely seniors, informed of the meeting by the AARP local chapter.

Dennis Hanson, a Fayetteville Town Council member, was the only elected official to speak at the hearing.

“As a resident and as an elected official, we feel the rate increase is far and above what the common person here can afford. This is going to put a burden on the residents of this community,” he said.

“We’re aware that an increase is probably justified to a degree, but we think this is in excess of what is fair.”

West Virginia American Water acquired the Town of Fayetteville’s sewer system in 2008. The system was out of compliance with environmental laws and regulations at the time, and the town wanted to unburden itself of the headache and expense of operations.

The sale required WVAW to invest $1.5 million in the system — about $1,300 per customer — and not raise rates for two years.

The current rate increase request reflects a $682,000 investment between 2008 and 2011. Another $320,000 was spent in 2012. And by the end of 2013, the company expects to invest another $360,000, according to Laura Jordan of WVAW.

Largely because of that investment, the sewer system is now in full compliance with state permitting and discharge requirements.

Jordan doesn’t think that people realized at the time of the deal what a $1.5 million sewer investment would eventually do to their bills.

“For five years, customers have enjoyed a low rate, but now they are seeing the effects of the capital investments that needed to be made,” she says.

In 2008, the town also sold its water system to WVAW. At that time, Town of Fayetteville water customers were paying about 20 percent less than other WVAW customers. To avoid rate shock, that 20 percent was phased in over five years after the acquisition.

The new 20 percent water rate increase, if approved, would be on top of that. That means Fayetteville residents would see double the rate increase over five years than the rest of WVAW’s customers.

Some residents in the immediate Fayetteville area still do not have public sewer. Some at the Wednesday hearing thought WVAW should be extending sewer lines.

“If West Virginia American would expand the sewer system to these outlying areas where they promised, they would be over greater area and wouldn’t be having to raise rates,” said Dale Epperly.

But extending sewer lines was “never a part of the deal,” according to Marshall Murray of WVAW.

“The mayor and city manager suggested it would be a good idea. ... We’d love to pick them up, but that initial investment is very high.”

The PSC only allows the utility to invest so much money per customer, and it’s not enough to extend the sewer lines, says Jordan.

The town or county could apply for a grant to fill that funding gap, she says.

“We fulfilled our obligations,” says Jordan.

From July 8-11, the PSC will hear testimony on these two rate increase cases. The evidentiary hearings will be broadcast live over the Internet at http://www.psc.state.wv. us/.

Based on that testimony and on public comments, the PSC will issue its decision. Any rate increase would not take effect before Oct. 11.

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