state agency governing utilities has sent the rate increase
requested by York Water Co. to an administrative law judge for
investigation, a formality in the approval process that allows for
a public hearing on the possible increase.
The Pennsylvania Office of Consumer
Advocate also plans to investigate the request, and lodge a
complaint to dispute the rate increase.
The action by the state Public
Utility Commission suspends the request until January at the
latest and starts a fact-finding period that will include a
hearing for public input. The date for the hearing has not yet
The water company asked the agency
for permission to increase its rates 16 percent, a move that would
increase the company's revenue by about $4.6 million. The rate
increase would affect about 55,000 customers in York County.
York Water saw record earnings of
$5.8 million last year, up $532,000 from 2004, representing an
increase of about 10 percent.
Its operating revenue was $26.8
million last year, a 19.1 percent increase from the $22.5 million
reported in 2004.
The company said the rate increase
is needed to offset costs for $15 million worth of planned
projects this year. That list includes replacement of aging water
mains and hydrants, installation of an automated meter reading
system, and improvements to the filtration and pumping facilities.
The state's consumer advocate,
Sonny Popowsky, said he will challenge the rate increase requested
by York Water.
"We will be opposing the rate
increase as we would always do with a case of this
magnitude," he said.
The issue is not whether the water
company needs to increase the rate, Popowsky said, but rather
whether they need to increase the rate as high as requested.
"That's typically where our
battle is with these water companies," he said.
Jeff Osman, president and CEO of
the water company, said the action taken by the commission was
fairly routine for York Water's rate increase requests.
In 2004, the water company
requested a 22 percent rate increase that eventually was whittled
down to 15.9 percent after a settlement with the state consumer
advocate office and a review by an administrative law judge.
It will not be a financial burden,
Osman said, if the company has to wait until January for the rate
"It's no crisis, but the
sooner we get approval for our rates, the sooner we can pay for
the investments," he said.
-- Reach Charles Schillinger at