Rate Adjustment for Iowa American Water Approved by Iowa Utilities Board
February 27 2017 - 6:50PM
Business Wire
Over $38 million in infrastructure investment
drives need for rate change
Following a 10-month review, the Iowa Utilities Board (IUB)
today issued an order adjusting rates for Iowa American Water. Iowa
American Water’s investment of approximately $38 million in water
system improvements is the primary driver behind the rate change
request.
In its final rate order, the IUB approved an overall increase in
additional annual revenue of $3.9 million or 10.37 percent. This
final order amount includes the previous temporary rate increase of
$2.1 million that was implemented by Iowa American Water on May 9,
2016 as allowed by Iowa Code § 476.6(9). Company officials say
those additional revenues will help Iowa American Water continue to
invest proactively in its water infrastructure throughout the
state. Iowa American Water last received a rate change order from
the IUB in 2014.
“Reliable water service is essential to everyday life and a
community’s strong economy, and proactive water system upgrades
today save money in the long run,” said Randy Moore, president of
Iowa American Water. “All these investments in local water
infrastructure systems enhance water quality, service reliability
and fire protection for customers while keeping the cost of water
service for most local households at about a penny per gallon.”
The need to upgrade water systems is a national challenge. In
2013, the American Society of Civil Engineers said that an
estimated $1 trillion in capital spending would be needed across
the nation over 25 years to replace thousands of miles of pipe,
upgrade treatment plants and comply with stricter water quality
standards. Iowa American Water is addressing this challenge.
Iowa American Water’s rates are based on the costs of providing
water service as reviewed and approved by the IUB. Moore added that
Iowa American Water has worked to control costs, reducing operating
expenses by about 10 percent or $1.7 million since the last rate
order.
The next step in the process will be for Iowa American Water to
prepare and file a rate design for approval by the IUB that breaks
down the allowed increase between the company’s various customer
classifications. An effective date for the new rates will be
established once the IUB approves the company’s rate design.
On April 29, 2016, Iowa American Water filed a proposal with the
IUB requesting to increase its annual revenue by $5.15 million.
Effective May 9, 2016, Iowa American Water implemented an interim
rate increase as part of its rate increase application as allowed
under state regulations. The interim increase allowed Iowa American
to begin collecting a portion of its rate increase while the IUB
and Office of Consumer Advocate (“OCA”) reviewed the full filing.
The interim rates generated about $2.1 million in additional annual
revenue and represent a $2.33 per month increase for the average
residential customer.
“As a utility whose services are critical to ensuring public
health, we take our responsibility to provide quality drinking
water seriously, and as such, are committed to keeping our systems
and facilities well maintained,” added Moore.
Customers needing assistance paying their water bills can
contact Community Action of Eastern Iowa to apply for help from
Iowa American Water’s Project H2O “Help to Others” program.
Community Action of Eastern Iowa administers this program, and
customers needing assistance are urged to contact their local
office in either Clinton or Davenport.
Customers can contact American Water's Call Service Center toll
free at 1-866-641-2108 with additional questions. Additional
information can also be found on the Iowa Utilities Board’s website
at www.state.ia.us/iub/.
About Iowa American Water
Iowa American Water, a subsidiary of American Water (NYSE: AWK),
is the largest investor-owned water utility in the state, providing
high-quality and reliable water services to approximately 212,000
people. With a history dating back to 1886, American Water is the
largest and most geographically diverse U.S. publicly-traded water
and wastewater utility company. The company employs more than 6,700
dedicated professionals who provide regulated and market-based
drinking water, wastewater and other related services to an
estimated 15 million people in 47 states and Ontario, Canada. More
information can be found by visiting www.amwater.com.
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version on businesswire.com: http://www.businesswire.com/news/home/20170227006701/en/
Iowa American WaterLisa ReisenManager, External
Affairs563-468-9221Lisa.Reisen@amwater.com
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