Water rates to rise 14% in Greenwich CT

By Neil Vigdor
Staff Writer

May 4, 2004

Town leaders are bracing for a possible water rate increase of nearly 14 percent, which could go into effect this fall if state regulators approve a request from a privately owned utility.

Aquarion Water Co., which serves 60,000 customers in Greenwich and another 133,500 in Stamford, Darien and New Canaan combined, filed a rate change application with the state Department of Public Utility Control at the end of March.

The Bridgeport-based utility estimated the average family of four in Greenwich and Darien would see its daily water rate increase from $1.09 to $1.24 per 200 gallons consumed. The annual rate would increase from $398 to $451 for 72,000 gallons of water consumed under the utility's proposal.

Stamford and New Canaan customers, who currently pay about 40 percent less in water rates because their communities are tied into a different reservoir network with different infrastructure, would see an increase of about 12 percent.

But before the rate hike can go into effect, state regulators have invited public comment as part of the regulatory process. And Greenwich recently announced that it would hire an outside counsel who specializes in utilities to represent the town in the matter.

"It impacts not only the town's finances but also every homeowner in town," said Jim Lash, the town's first selectman.

The town's lawyer is expected to monitor the regulatory proceedings and file a petition with the DPUC. The nature of that petition is undetermined at this point.

Water rates charged to municipal fire departments would increase by about 6 percent under the proposal.

"We're prepared for that in this upcoming budget that there will be a rate increase," Greenwich Fire Chief Daniel Warzoha said.

Aquarion is seeking the higher fees to pay for improvements to its infrastructure.

The company estimated it had invested $9.6 million upgrading its treatment plants, water mains and storage tanks in Greenwich and Darien alone in the past three years. The last water rate hike -- 11.22 percent -- occurred three years ago when the utility was under different ownership.

A spokeswoman for Aquarion called the proposed increase fair in light of the company's commitment to improving infrastructure, inflation and the need for water.

"We have to have it for life," said Adrienne Vaughan of Aquarion. "We want to continue to make sure that we provide the highest quality of water and service that we can."

As part of the regulatory process, the Kelda Group subsidiary will be required to open its books to the state DPUC. Three commissioners from the state agency will have the final say on the proposed rate hikes.

Aquarion reported slightly more than $110 million in revenue from April 1, 2003, to March 31, 2004, in Connecticut alone. The company is seeking a $16.1 million revenue increase this year.

State regulations stipulate that utilities earn enough money to be able to provide safe, adequate and reliable service, while having the opportunity to make a return on their investment, said Beryl Lyons, a state DPUC spokeswoman.

"The burden of proof is on (the utility)," Lyons said, adding that the average rate hike application takes five to six months to decide. "It is rare that any company gets everything they ask."

Lyons described the water company proposal as a major case, one that she said has already attracted considerable public comment.

"We've gotten some customer complaints," Lyons said.

Copyright 2004, Southern Connecticut Newspapers, Inc.