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Back in September of last year, the
Illinois-American Water Company announced that it was asking for a
13.25 percent rate increase for Lincoln's water users. The increase
was the same for all categories of customers -- residential,
commercial, industrial and all others.
The city decided to get legal help to
fight the increase, thinking that with the high unemployment level
in Lincoln, residents and businesses could ill afford a water rate
increase.
The city presented testimony to the
Illinois Commerce Commission, the body that makes the final
decisions about approving requests for utility rate increases.
According to testimony given by Davis, the ICC staff proposed a 16.3
percent rate increase, somewhat more than the utility company had
asked for.
Now an intervener for the attorney
general's office has suggested that Lincoln residents should get a
33.3 percent increase, more than double the amount Illinois-American
requested.
What makes the situation so confusing,
according to a representative of Illinois-American, is that neither
the utility company nor the Illinois Commerce Commission is
supporting the increases requested by the attorney general's office.
According to Sue Atherton, communications manager for the Northern
Division of the utility, it's a most unusual situation.
She said a staff member of the attorney
general's office, which has the power to intervene in rate hearings,
made the request to lower rates for Chicago-area water users and
raise them for downstate Illinois users. The Chicago Metro District
includes many suburban communities, which face a 60 percent rate
hike because of higher costs of pipelines from Lake Michigan and
treatment of the water.
The attorney general's staff member who
advocated the 33.3 percent increase also suggested a 24.5 percent
increase for commercial users, a 19.9 percent increase for
industrial users and a 24 percent increase for public authority
users.
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Illinois-American has not asked for
higher rate hikes in Lincoln than the original 13.25 percent,
Atherton said, and does not advocate different rate increases for
different categories of users in Lincoln.
"A greater rate hike is not needed. We
don't support the attorney general's proposal, and there is
considerable opposition to it," Atherton said.
Attorney E.M. Fulton, hired by the city
to help protest the increase, said city officials were "stunned" by
the 33.3 percent request, and the city is submitting a brief to
argue against the increase and against the rate being skewed toward
residential users.
The final decision on just what Lincoln
residents and businesses will pay for water will be made by the
Illinois Commerce Commission sometime before a deadline set for Aug.
16, Atherton said. The ICC is still accepting briefs and looking at
testimony.
"There is plenty of time for more
opinions to be heard," she said.
In her most recent testimony to the ICC,
Davis argued that the suggested 33.3 percent increase puts a greater
burden on residential ratepayers than on other categories of users.
In earlier testimony, Davis argued that
even the 13.25 percent increase was too much for the Lincoln
community, which has lost a major employer, Lincoln Developmental
Center, and has seen the failure of several businesses in town.
Davis also said rates proposed for the
cities of Peoria and Alton are lower than those proposed for
Lincoln. She said she thought other cities were getting better deals
than Lincoln.
When it originally asked for the rate
increase, Illinois-American said more money was needed because of
heightened security costs since Sept. 11, 2001, and to replace and
update aging infrastructure. In 2001 and 2002, Illinois-American
invested $1.1 million to upgrade the water system in its Lincoln
district. There has not been in increase in water rates in Lincoln
since 1995, Atherton said.
Illinois-American serves about 290,000 metered customers, about
913,200 users, in 20 counties and 124 Illinois communities.
[Joan Crabb]
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