UPDATE: The IURC issued an order in this case on Sept. 13, 2006, approving the settlement agreement between the OUCC and City of New Castle.
OUCC News Release, Issued Aug. 18, 2006:
The Indiana Office of Utility Consumer Counselor (OUCC) and the City of New Castle have reached a settlement agreement regarding the city's request for a water rate increase. The agreement, presented during an evidentiary hearing this week, is now pending before the Indiana Utility Regulatory Commission (IURC) which will make the final determination in the case.
Under the agreement, the monthly water bill for an average residential customer who uses 700 cubic feet (approx. 5,200 gallons) will increase from $12.15 to $15.80. Both parties agree that a rate increase is necessary in order to ensure safe, reliable service for all of the utility's customers. If approved, the agreement will provide the city with its first water rate increase since 1990.
While the agreement provides the increase amount the city had requested, it also requires that several OUCC recommendations be implemented. Among them:
- The OUCC will conduct a comprehensive review of the utility's records in the summer of 2008, to evaluate whether a rate decrease should be considered at that time. The utility's current debt will be retired no later than January 1, 2009.
- The city will be required to provide a report on interest rates obtained within 30 days after completing any construction financing. This will help ensure that financing costs are accurately reflected in rates.
- The city will be required - within 60 days after an order is issued in this case - to file a request with the IURC to increase its connection fees on new customers along with other non-recurring charges. This will help ensure that development costs for serving new customers in the future are borne by those specific customers rather than the utility's existing ratepayers.
The outcome of this case will only affect the city's water rates. Indiana law exempts municipal sewer and storm water rates and charges from IURC jurisdiction.
The Indiana Office of Utility Consumer Counselor (OUCC) is the state agency that represents utility consumer interests in state and federal regulatory proceedings. To learn more, visit www.IN.gov/OUCC.
(IURC Cause No. 42984)
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