Thursday, Aug. 14


Water bills going up     Send a link to a friend

Infrastructure improvements and heightened security costs cited

[AUG. 14, 2003]  The Illinois Commerce Commission voted Tuesday, Aug. 12, to approve new water rates for Illinois American Water. The company filed for new tariffs on Sept. 20, 2002. The ICC regulatory hearing process took 11 months, as anticipated.

It is the first water rate increase for Lincoln water customers in 8 years. The new rates will become effective within a week, company officials said.

In September 2002, the company proposed a 13.68 percent increase for the Lincoln District. The requested rate increase from the company was the same for all categories of customers -- residential, commercial, industrial and sale-for-resale (wholesale) customers.

However, the ICC rate order issued Tuesday varies by customer classification. Under the new order, residential users received a higher increase, at 13.68 percent, than larger (industrial, commercial, sale-for-resale) water users.

The average residential customer's monthly water bill (for usage of 6,000 gallons per month, including municipal fire protection charges) will increase approximately $4.79 per month, or about 16 cents per day, raising it from $28.30 to $33.09 per month.

According to Lincoln Operations Superintendent Grant Evitts, the major reasons for new water rates are the company's ongoing infrastructure replacement program and increased operating costs, including costs associated with heightened security since Sept. 11, 2001.

Infrastructure replacement includes replacing and installing new water lines, service connections, meters and hydrants and making enhancements at water treatment pumping and storage facilities.

Evitts said new rates will also allow the water company to continue its ongoing proactive program to replace and update aging infrastructure. In 2001 and 2002, Illinois-American invested $1.1 million in upgrading the water system in the Lincoln District. Upgrades include replacing and installing water mains, service connections, meters and hydrants and making enhancements at water treatment, pumping and storage facilities. Major capital improvements include a new well and well site development, the Omaha Street water main to serve Lincoln Christian College, a 2-inch water main replacement at Palmer and Feldman streets, and upgrades to the district's SCADA control system. All improvements help ensure continued reliable delivery of water service to customers.

"We continue to make sound investments and improvements in our water systems. Along with enhancing service, these investments assure reliable delivery of high-quality water today and in the future," said Northern Division Manager Kevin Hillen.


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He added that many communities in Illinois and across the United States face the dilemma of aging infrastructure in their water and wastewater systems. The U.S. Environmental Protection Agency estimates that U.S. cities will have to spend more than $250 billion to repair drinking water systems over the next 20 years. These costs intensify when new rules and regulations for water quality are issued.

Hillen said that since Sept. 11, 2001, all Illinois American Water treatment facilities and offices have been under heightened security and will remain in that status indefinitely. Hillen said the company continues to review and monitor security measures to ensure the most feasible -- but effective -- security methods are being used. Specific details of all Illinois American security measures are confidential.

The ICC approved rate increases in all of the company districts: Alton, Cairo, Peoria, Pekin, Lincoln, Interurban (Belleville, East St. Louis, Granite City and surrounding communities), Champaign, Pontiac, Streator, Sterling and the Chicago Metro Division.

Although the ICC's order allows the overall increase that the company requested in the Lincoln District, the ICC denied the company's request for recovery of deferred security costs. Deferred costs are for those security costs accumulated from September 2001 until the rate order was entered on Aug. 12, 2003.

About Illinois American Water

Illinois American provides reliable, quality service to approximately 293,000 metered customers, or more than 1 million people, in 125 Illinois communities. The company has been providing service in Illinois for more than 100 years.

About American Water

American Water, a part of RWE's water division, serves 20 million customers in 27 states, four Canadian provinces, Puerto Rico and South America. More than 8,000 employees provide water, wastewater and other related services. RWE's water division is the third largest water and wastewater services company in the world.

[Illinois American Water news release]

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