On July 14, 2017, Whitinsville Water made filings with the Department of Public Utilities (“DPU”) seeking approval of a general rate increase of $773,212 which represents an overall increase of 25.1 percent in the Company’s currently effective rates. Whitinsville Water last received a general rate increase in February 2010, based upon financial data from 2008 and 2009. The Department has docketed this matter as D.P.U. 17‑108. No rate increase is expected to become effective until June 1, 2018 — after a full review by the DPU and possibly other parties, including the Town of Northbridge and the Office of the Attorney General.
If the Company’s petition is approved as presented, a typical residential customer in Whitinsville/Northbridge, MA using 800 cubic feet per month would receive an increase of approximately $9.24 per month, or 16.9 percent. Bill impacts will vary based on customer class and volume used. The levels of increase to different customer classes were determined in part by consideration of a cost of service study that determines the cost of providing service to those different customer classes. More specifically,
- The retail volumetric rate will increase from $4.24 per one hundred cubic feet (Ccf) to $5.45 per Ccf, while the wholesale volumetric rate with increases from $3.13 per Ccf to $4.63 per Ccf.
- The existing base service charge for a WWC customer with a 5/8” meter (approximately 93% of the WWC’s customers) will decrease from $20.65 per month to $20.20 per month, or by approximately 2%.
- Monthly public fire protection charges, assessed to the WWC and Town of Northbridge customers on a per retail meter basis, will increase by approximately 5% from $9.91 to $10.38. In a prior rate filing, the WWC and Town of Northbridge agreed that public fire protection charges would no longer be assessed to the Town based on the number of public fire hydrants; but rather the costs of public fire protection would be assessed directly to the retail customers of the WWC and to the Town of Northbridge’s customers on a per meter basis. This methodology has been continued for this filing.
- Private fire protection charges will all decrease by varying percentages based on the size of the connection.
The Department will conduct a public hearing to receive comments on the Company’s petition, likely in Northbridge in 2-3 months and will later conduct evidentiary hearings in Boston to examine the propriety of the Company’s proposals.
Although the Company devotes considerable efforts to keeping costs down, it must maintain and improve its facilities to continue to provide a high level of service. As such, many of the basic costs incurred to serve customers have increased. For example, the necessary plant additions and replacements since the last rate case have increased the Company’s rate base by 50%. Such projects include the construction and implementation of a new water treatment facility at the Whitin Wellfield on Carr Street. This facility removes the naturally occurring iron and manganese in the raw water and has greatly improved the aesthetics of our water. Also, the Company has experienced significant cost increases for many items, including health insurance and retirement benefits, chemical and electric costs, payroll increases, and real estate taxes. The Company has sought to mitigate the impact of such cost increases through its cost containment efforts. These cost containment efforts include requiring employees to pick up a larger portion of their health care costs, migration to 401K retirement program, using bid processes for construction projects and other provision of services, among other things. Also, the Company’s move to automated meter reading has helped to contain cost increases and will allow the company to move to monthly billing. It should be noted that the move to monthly billing is included in this rate filing and will be implemented with the new rates in June 2018. In addition to the capital expenditures and costs increases noted above that have necessitated this rate filing; we also understand that the DPU prefers that water utilities make rate filings within shorter timeframes so that the rate impacts are less at a given time. It has been seven years since our last rate filing which is on the longer end of the desirable time spectrum and therefore a filing is warranted. For all these reasons, the Company has reluctantly determined that it is now necessary to increase its rates.
We recognize that increases in water rates are difficult for many customers, which is why we seek to avoid or defer rate increases until they are absolutely necessary. We have also sought to minimize the impact to lower use customers such as the elderly, by decreasing the base service charge and placing more emphasis on volumetric usage charges. We always seek to provide high quality water and customer service. We value our relationship with the Town of Northbridge and with all our customers, so we want to encourage a dialogue and seek to answer any questions during this process.