Westmoreland water customers to pay more
By Rich Cholodofsky
Published: Friday, Nov. 9, 2012, 12:01 a.m.
Municipal Authority of Westmoreland County water customers will pay about $85 more next year under a rate increase approved Thursday.
Board members voted to implement a 25 percent rate hike designed to offset four years of stagnant revenues, operational losses and more than $140 million of proposed capital improvements for delivery and treatment systems.
“I feel 100 percent sure of what we're doing here,” board Chairman Jerome DeFabo said. “The future of our authority is at stake.”
The authority last raised rates in 2008.
The current increase will go into effect in early February.
The average residential customer will see yearly bills increase from $340 to $425, officials said.
Board members incorporated the rate hike into a $74.5 million budget approved Thursday, about three months earlier than usual. The 2013-14 budget was adopted early to meet regulatory requirements that customers receive at least three months notice on a pending rate increase.
The rate hike is expected to generate about $11 million in additional revenue next year.
“The biggest chunk of the increase is for infrastructure development,” said board member Randy Roadman.
The authority last month approved a five-year capital improvement plan that calls for $141 million in enhancements to the water system, which supplies more than 120,000 customers in five counties.
About $36 million is expected to be earmarked to extend transmission lines throughout Westmoreland County to provide water to all customers should one of the authority's major intakes or treatment plants go off line.
Plans call for improving the system's three water treatment plants, replacing pump stations and installing new pipelines.
Money will be used for infrastructure needed to sell water to Monroeville and Plum to begin serving those communities in 2016.
Some of the authority's 63 water tanks will be repainted and up to 15,000 water meters will be replaced.
The authority borrowed $57 million in 2006 to finance improvement projects.
The board is expected to borrow money or sell bonds next year to pay for the projects.
Authority manager Chris Kerr said more than half of the rate increase will pay for expected debt generated by the infrastructure projects.
A portion will be used for authority operations, which last year operated at a deficit. The current budget was balanced with money from the authority's surplus.
Kerr said the rate hike will balance the budget but infuse an additional $2 million into the surplus fund.
“We expect the authority won't have to raise rates next year or the year after. I really believe this in an appropriate budget at this time,” Kerr said.
Board member Joe Dreskler voted against the budget and rate hike, which were approved by a 4-1 vote.
Dreskler, whose term expires at the end of the year, said his replacement should have had an opportunity to vote on the budget.
Rich Cholodofsky is a staff writer for Trib Total Media. He can be reached at 724-830-6293.
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