Mayor Greg Fischer is calling on the Louisville Water Co. to reconsider a proposed 5 percent rate increase set to take effect Jan. 1.
The water company’s board discussed a possible hike last week citing a drop in consumption due to a cooler than expected summer. It would be the fourth consecutive year the company has increased its rates and would raise the average monthly bill by $1.
But Fischer says the utility company can find savings and make cuts to come up the difference rather than pass the cost on to customers.
“My message to the Water Company consistently has been not to rely on automatic price increases to make its budget balance,” says Fischer. “The Water Company and its board have a great record of quality and performance and I’m confident they can find further savings.”
The mayor is a member of the Board of Water Works and appoints the other six seats. He asking for them to limit their rate hike of 4 percent or less.
Kelly Dearing Smith is the spokeswoman for the Louisville Water Company. She says the proposed hike was only at the preliminary level and was never finalized.
“Louisville Water Company has tried to do a very modest rate increase each year. So at our October meeting we began discussing a range of a rate increase that would be 3.75 to 5 percent. It’s important to understand that there was no decision. It was just a discussion,” she says.
About 850,000 people are served by the Louisville Water Company, including some residents in surrounding counties. The rising costs of its infrastructure needs and water quality is a financial reality for the company, but the board will heed the mayor’s request.
“At the end of the day we are absolutely going to be more efficient. We’re going to respect the mayor’s input and we are going to do our best to meet his expectations,” says Smith.
Since taking office, Fischer has been urging for changes regarding the management of the city’s water and sewer system. In 2012, for instance, he commissioned a task force to study merging the water company with the Metropolitan Sewer District.
The city owns 100 percent of the stock in the water company and receives a hefty dividend as a result. It is projected Metro Government will get about $19.3 million this year and $20.2 million from the water company in 2014.
For years, critics have called the utility company’s rate hikes a “hidden tax” on residents.
Fischer, who is running for re-election next year, says he believes the water company can keep its usage rates at a minimum while also paying the annual dividend to the city.
Asked if that’s fair for the utility, Smith said: “One of the great things about Mayor Fischer is he pushes you and encourages you to be more efficient. So we respect that and we want our owner to be proud of the product we provide.”