Evansville’s water utility is seeking a 3% rate increase to take effect Jan. 1.
The request comes after the state Public Service Commission expressed concern in a letter to city officials in late September that the “ongoing financial integrity of the utility may be in jeopardy.”
The letter says the PSC notifies utilities when they operate at a loss for two years and have less than 90 days of cash on hand. Evansville was one of 12 water utilities statewide to receive such a letter this year.
The commission “strongly” suggested the city apply for a conventional rate case to address its budget deficit. It also suggested a possible stopgap step of applying for a simplified rate case, and that’s what the city did on Nov. 10.
Simplified rate cases are designed for quicker approval and smaller rate increases. The PSC says the stopgap rate increase likely would not be enough to ensure the utility’s financial integrity. The city can still pursue a subsequent conventional rate case application.
City officials have not yet responded to a request for comment.
The simplified rate case application includes some sample rate increases. For average residential users (about 435 cubic feet a month), the monthly payment would go from $29.36 to $30.24. Large residential users (800 cubic feet) would see an increase from $43.92 to $45.24.
A commercial users’ monthly payment would go from $113.77 to $117.20 for 2,600 cubic feet, and for an industrial user using 38,300 cubic feet, the cost would go from $1,367.37 to $1,408.59.
