The Indiana Utility Regulatory Commission has approved a settlement agreement regarding a proposed rate increase by Greenwood-based Indiana American Water. The deal will result in the average residential customer seeing a total increase of about $2.50 on their monthly water bill.
The utility reached the settlement with the Indiana Office of Utility Consumer Counselor in May. The OUCC says the agreement will generate $17.5 million in additional annual revenue for Indiana American Water. The original proposal filed in September had requested a $38.8 million increase.
"The Commission’s order brings a fair resolution to this case," Indiana Utility Consumer Counselor Bill Fine said in a news release. "The increase under the approved agreement is significantly lower than what IAWC had requested. More importantly, the agreement provides an appropriate balance between aging infrastructure improvements and fair rates to cover those costs, to help ensure the reliable delivery of clean water to the utility’s customers throughout the state."
The rate increase will occur in two phases. The utility says, for a residential customer using 4,000 gallons of water per month, the first phase would create an increase of 34 cents per month, which takes place Monday. The second phase will see an increase of $2.22 per month beginning in May 2020.
The agreement also includes the implementation of a low-income pilot program focusing on customers in Gary, Muncie and Terre Haute. It also resolves all issues related to the federal Tax Cuts and Jobs Act of 2017 and the proper sharing of federal tax relief with customers.
"We appreciate the cooperation of the Office of Utility Consumer Counselor and other interested parties in this proceeding to work toward and reach a negotiated settlement in this case," said Indiana American Water President Matt Prine. "We believe the terms embodied in this agreement and the IURC’s order are both reasonable and fair and in the best interests of our customers across the state."