Utilities commission approves Aqua rate increase | North Carolina | Indy Week
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Utilities commission approves Aqua rate increase 

There's the brown sludge that runs out of the tap, the chlorine smell, the chunks of sediment water filters can't completely remove.

There's the fact that Aqua NC customers are paying among the highest utility rates in the state for what they say are sub-par services. And now they will pay more, since the N.C. Utilities Commission approved a 5.2 percent rate increase and a controversial provision that could further jack up customers' bills.

"For me, as a consumer who's beyond median income, [the rate increase] is irrelevant," said Sally Stoehr, who lives in Raleigh's Wildwood Green neighborhood, which is on an Aqua NC system. "But it's not irrelevant to people who can barely make their payments as it is. They are living in mobile homes and Aqua is charging them (more than) $90 a month for water? It's outrageous."

Aqua NC owns 800 water and/or sewer systems and serves 90,000 households, making it the largest private water and sewer utility in the state.

The recent rate request was the company's third in six years. Though the rate increase is lower than the 19 percent rate increase Aqua NC proposed last August, data from the School of Government at the University of North Carolina-Chapel Hill show that Aqua NC customers will continue to pay more than residents on publicly owned water systems.

An online tool from the school's Environmental Finance Center shows in February 2014, Aqua NC customers who used 5,000 gallons of water a month for both water and sewer services paid $107.34. For the same services, municipal customers in Raleigh paid $57.39; in Durham, $54.48 and in Cary, $69.64.

"Time and time again, the Utilities Commission has shirked their duties to look out for the best interest of the public, protecting corporate bottom lines instead," said Katie Hicks, assistant director of the advocacy group Clean Water for North Carolina.

And there's the prospect that Aqua NC will raise its rates even higher—in 5 percent increments—to pay for maintenance costs. Because of a controversial provision, known as a surcharge mechanism, also approved by the utilities commission, those increases are not subject to public hearings and could be added to existing rate hikes.

The surcharge mechanism, also known as the System Improvement Charge, is designed for utilities to recover costs of maintenance between regular rate increase hearings. The state Attorney General's office and the state treasurer emphatically opposed the mechanism during Aqua NC's rate case hearing.

Internal review by the utilities commission and its public staff will be the only oversight for these interim rate hikes.

The state Legislature approved the mechanism last year. Since 2011, similar mechanisms have operated in at least eight other states. Hicks says lobbyists for Aqua America helped draft some of the language in these bills, and that the company was "heavy handed in pushing it through state legislatures."

Critics of the surcharge, including D.C.-based consumer advocacy group Food and Water Watch, say it is a scheme to boost corporate profits by shifting risks to the public and bypassing consumer protections.

"It's unbelievable we as consumers won't have our voices heard in this situation," said Tony DeLuca, an Aqua NC customer who lives in the Robins Wood neighborhood of Chapel Hill. "It goes back to the utilities commission just being in the pocket of the company."

Several members of the public staff formerly worked for Heater Utilities, which Aqua acquired in 2004. A former utilities commissioner, Jo Anne Sanford, is now an Aqua NC attorney.

Aqua NC president Tom Roberts said money from the surcharge will pay to improve water quality and to replace meters and pipes. Of the more than 800 systems the company owns, Roberts said it has prioritized those needing the most attention.

"We are committed to fixing these issues," Roberts said. "Some systems here are 40 or 50 years old and we look to resolve them with a reasonable pace and we look forward to working with the Public Staff and the North Carolina Utilities Commission to move forward on some water quality issues."

Here are links to the INDY's previous coverage of Aqua NC:

"Why Aqua NC customers are furious about their service" "Durham tries to prevent Aqua NC from reselling city water to 751 South" "Is Aqua NC in bed with 751 developers?"

This article appeared in print with the headline "The long gouge"

  • Aqua NC's rates keep going up and up

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