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Pennsylvania American Water Co. seeks 11 percent rate increase

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Tuesday, April 30, 2013, 10:35 p.m.
 

Pennsylvania American Water Co. is asking regulators to approve a more than 11 percent increase in the cost of residential tap water to pay for millions of dollars of improvements to aging pipes, pumps and storage tanks.

If the Pennsylvania Utility Commission approves, the rate would be $1.0135 per 100 gallons for residential customers, up from $0.9101 per 100 gallons. That translates to about $6.12 more a month for the typical household, the company said.

When Pennsylvania American Water Co. last raised rates, Doug Finck of Sudzburgh Coin Laundry in Baldwin Township, absorbed the increase for about nine months before he had to up the cost of a load of laundry by a quarter. The laundry uses between 48,000 and 50,000 gallons of water a month, and Finck said his water bills range between $400 and $500. If his bill goes up another $40 or $50, he said he'll likely have to make changes.

“The only thing you can do is you eat it or you've got to increase your price,” Finck said.

The proposed rate increase would cut into the budget of Mt. Lebanon Recreation Department. The department uses “a lot of water,” said Director David Donnellan, who could not estimate the number of gallons used monthly. Mt. Lebanon is billed for water used in the swimming pool, on the golf course and in restrooms throughout the department's facilities.

“It definitely takes a bite out of our budget,” Donnellan said. “There's not much we can do about it when they raise the rate.”

Since the last increase in November 2011, Pennsylvania American invested $731 million in system repairs and upgrades statewide, “so that we can ensure that our customers continue to receive reliable service,” company President Kathy Pape said in a statement.

Those improvements include $215 million worth of work in southern Allegheny County and northern Washington County. Of that, $174 million in infrastructure work was in Pittsburgh, spokesman Gary Lobaugh said.

Crews replaced aging mains, upgraded pumping station, and performed maintenance on tanks, he said.

“We replaced 300 miles of water mains statewide,” Lobaugh said. “A high percentage of that 300 miles started out as a main break — we'd do the initial repair, and the affected pipe becomes a candidate for further replacement later on.”

Commercial customers would pay $1.0073 per 100 gallons for the first 16,000 gallons and $0.7722 for each 100 gallons after that; municipal customers would pay $1.0073 per 100 gallons for their first 16,000, then $0.8423 per 100 gallons beyond that.

Pennsylvania American asked for the increase to take effect in late July. The PUC usually “suspends” increases so officials can review work the company did and decide whether a rate increase is justified, Lobaugh said.

He does not anticipate actual rate increases taking place until January.

The PUC can permit a lower rate increase than what a utility requests. Last time, Pennsylvania American requested a 13.3 percent increase, but the commission approved a 7 percent increase.

Staff writer Aaron Aupperlee contributed to this report. Matthew Santoni is a Trib Total Media staff writer. Reach him at 412-380-5625 or msantoni@tribweb.com.

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