A water utility headquartered near Taylorsville claims they might charge their customers less if they are allowed to regulate themselves.
Eastern Bartholomew Water Corp. has sent letters to customers, seeking input on whether or not they should opt out of the Indiana Utility Regulatory Commission (IURC).
Customers are asked to send back their reply to a one-question survey : “Do you believe we should remain with the IURC in Indianapolis or opt out and allow our local board to make the best decisions for our service areas?”
Eastern Bartholomew is asking that all surveys be returned by March 22.
The IURC is the state agency that determines water rates and sets regulations for utilities that fall under their jurisdiction. Their purpose is to require utilities to “make decisions in the public interest to ensure the utilities provide safe and reliable service at just and reasonable rates,” according to its website.
In April, 2017, it was the IURC that heard public hearings and concerns when Eastern Bartholomew wanted to raise its rates for customers using an average 5,000 gallons a month from $22.83 to 33.77.
Commission members eventually approved a two-stage rate hike in July, 2017. In the first phase, rates went from $22.83 to $25.67. A year later, they rose to the second phase level of $28.45 a month.
In their letter dated March 8, Eastern Bartholomew told customers that a rate case, which could last several months, might cost the utility an average $24,500 a year during a typical five-year rate period. The water utility stated it has become too costly and time-consuming to remain under the state’s regulatory wing.
“Because of the cost of engineering and rate consultants, your board recognizes an opportunity to better serve customers by withdrawing from the jurisdiction of the IURC in Indianapolis, which could be saved and repurposed to potentially reduce the amount of future rate increases,” the letter states.
The utility’s suggestion that it might cut rates comes just weeks after Eastern Bartholomew implemented a 7% rate increase, Hope Town Manager Jason Eckart said. The town of Hope purchases its water from Eastern Bartholomew and sells it back to its residents.
Eckart describes the utility’s self-regulation proposal as “disconcerting.”
“It sounds to me that if (Eastern Bartholomew) does that, that sort of eliminates our system of checks and balances,” Eckart said. “I mean, that’s what the IURC is for. Without those checks and balances, an issue could certainly develop in the future.”
Besides the IURC, there is also the Indiana Office of Utility Consumer Counselor (OUCC), which has the mission to give Indiana consumers a voice when decisions are made that could affect utility rates and services.
While the office does not intervene when a utility considers opting out of the state commission , OUCC Director of External Affairs Olivia Rivera says they do offer fact sheets and other information outlining advantages and disadvantages on the matter.
For example, opting out means the Eastern Bartholomew Water Corp. board of directors will make all final decisions, although they will remain subject to applicable laws, the OUCC website states.
If Eastern Bartholomew wishes to govern themselves, the board of directors “must have the knowledge and desire to provide quality service, charge reasonable rates, and provide appropriate oversight of consultants,” the website also states.
According to the OUCC, most municipal and not-for-profit utility rate cases that go before the IURC are settled, rather than litigated. That indicates a mutual desire to be as cost effective as possible, the website states.
There are others who get water from Eastern Bartholomew with reservations similar to what Eckart expressed.
One is Hope restaurant owner Mark Cornett, who says he’s talked with customers about the proposed deregulation.
“None of them were for it,” said Cornett, who added some customer comparisons were akin to ‘having the fox guard the hen house,’ he said.
Like Eckart, Cornett says he also doesn’t know why a water utility feels it should be self-regulated.
The owner of Cornett’s Corner Cafe says that while he’s unsupervised and runs a private business, his restaurant still has to abide by several fire, health and safety regulations.