Indiana American Water Co. Rates
The OUCC, Indiana American Water Company (IAWC), and additional parties have reached a settlement agreement in the utility's pending rate case.
- OUCC News Release (3-19-19)
- Settlement Agreement
- OUCC Settlement Testimony: Stull
- OUCC Settlement Testimony: Mierzwa
- IURC Case File
The IURC evidentiary hearing has been continued to April 11, 2019. IURC public field hearings in this case were held in Seymour and Gary, respectively, on November 7 and 26. The OUCC issued previous news releases in this case in October 2018 and December 2018.
This page will be updated based on case developments.
IAWC's current base rates were approved in January 2015.
In its 139-page order, the IURC approved settlement agreements reached between the OUCC and IAWC, and with all intervening parties in the case (IURC Cause No. 44450). The approved agreements authorized IAWC to raise its annual operating revenues by 2.55 percent. By comparison, IAWC requested a 9.8 percent increase when it filed its case in January 2014.
The OUCC's November 21, 2014 news release offers an overview of the agency's agreement with IAWC.
In its litigation position, the OUCC recommended a rate decrease as summarized in the agency's May 5, 2014 news release. The OUCC also issued a March 17, 2014 news release inviting consumer comments and announcing the IURC's April 2014 public field hearings in Franklin and in Gary.
Distribution System Improvement Charge
In addition to general rate cases, Indiana law (IC 8-1-31) allows water and sewer utilities to seek expedited rate recovery as often as once per year to replace infrastructure (such as aging distribution lines) that has exceeded its useful life.
This surcharge is referred to as the Distribution System Improvement Charge (DSIC).
- The law allows a water or sewer utility to impose a surcharge to earn a return on investment used to replace aging distribution or collection system infrastructure since its last rate case. Without this law, a utility would be required to wait until its next rate case to begin earning this return.
- A surcharge may not be imposed for plant additions used to connect new customers.
- Under the law, total surcharges cannot exceed 10 percent of the base revenue amount approved in the utility’s most recent general base rate case.
- The surcharge, which investor-owned water and sewer utilities may make between general base rate cases, requires IURC approval to take effect. A Commission order is required within 60 days of the utility’s filing.
- By law, the OUCC must file its report within 30 days of the utility’s request. The OUCC’s review is generally limited to whether the infrastructure additions qualify under the statute and whether the surcharge has been calculated correctly.
In Cause No. 42351-DSIC 9, IAWC received IURC approval for a surcharge raising rates by 1.95 percent.
- The OUCC filed testimony in February 2016, recommending lowering the surcharge to 1.87 percent.
In Cause No. 42351-DSIC 10, IAWC received IURC approval to increase the surcharge to 6.62 percent.
In Cause No. 42351-DSIC 11, IAWC received IURC approval to increase the surcharge to 8.43 percent.
Lead Service Line Plan
IAWC received approval of a lead service line replacement plan on July 25, 2018.
In testimony filed on April 13, 2018, the OUCC recommended approval of the plan with specific modifications. The order is on appeal.