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Scrutiny of water rate proposal has begun

01:00 AM EDT on Friday, May 16, 2008

By Talia Buford

Journal Staff Writer

WEST WARWICK — The first round of inquiries into the Kent County Water Authority’s proposed rate increase has begun.

A packet of 30 questions arrived in the agency’s office this month from the state Division of Public Utilities and Carriers, said Timothy J. Brown, the water agency’s general manager. He said the agency is preparing to send a response to the division, which represents consumers’ interests.

“This is the data-gathering phase,” Brown said. “It’s sort of a point-counterpoint. … [T]his gives us full exposure and lets them review what we feel is our position in our case and what our needs are.”

The agency filed alternative rate proposals with the Public Utilities Commission in March. One of them would increase the average customer’s bill by about 35 percent, or roughly $156 a year. The Water Authority, headquartered in West Warwick, serves 26,360 customers, in West Warwick, Coventry, East Greenwich and West Greenwich and parts of Cranston, Warwick, Scituate and North Kingstown.

The agency is looking to add $5.2 million to its revenues to help make up for what it called a loss of customers and to offset increased operating costs and meet government mandates.

The agency says it is $1.2 million short of the $6 million that the state requires it have on hand to maintain equipment. It needs $1 million to pay off bonds it issued out in recent years to complete long-term projects. And, like everyone else, the agency is facing increased utility and gas costs.

The rate filing is the agency’s first in three years. Any increase approved by the PUC would not take effect until November.

The Water Authority now charges its household customers $3.79 per 100 cubic feet — 750 gallons.

As an alternative to the flat 35 percent rate increase — which would increase that rate to $5.14 — the Water Authority proposed increases that fluctuate seasonally. For July, August and September, customers would be charged $5.30; for the remaining nine months they would be charged $5.01.

Both proposals are designed to realize the same amount of added revenue.

Once the agency answers the questions posed by the Division of Public Utilities and Carriers, the division will file a recommendation with the PUC. That will be a prelude to public hearings on the request.

While the PUC had not posted a schedule on its Web site as of yesterday, Brown said the first hearings will be held in September.

Brown said the Water Authority’s customers are welcome to weigh in with letters to the PUC.

“We’ll take any letter of support they want to write,” he said with a smile.

tbuford@projo.com