PORT RICHEY — On appeal, state staffers say Aqua Utilities shouldn't get the $2.6 million in rate increases that officials approved last May.
Aqua should get $200,000 more.
The staff for the Public Service Commission, which regulates utilities, issued a recommendation late Thursday on the complicated rate case that affects 58 water and 27 wastewater systems in 17 Florida counties — including about 3,000 customers in Jasmine Lakes, Palm Terrace and Zephyr Shores.
The Office of Public Counsel, which represents customers' interests in rate cases, was still sorting through the 300-page recommendation on Friday to determine the rationale for even higher rates that would raise a total of $2.8 million statewide. The public counsel had filed the appeal to the original $2.6 million in rate hikes, arguing Aqua Utilities provided unsatisfactory service and was asking for too much money as reimbursement for its costs in seeking the rate hikes. The office also argued customers simply couldn't pay more.
"It is unconscionable that the (PSC) staff has recommended that Aqua receive $200,000 more than the company requested," said state Sen. Mike Fasano, R-New Port Richey, who has sided with customers fighting the utility. "The economic impact of the original rate increase was devastating for the customers of Aqua. To have an additional rate hike suggested on top of that is beyond comprehension."
Under the rates approved last year, water and sewer bills for an average Jasmine Lakes home that uses 5,000 gallons a month grew by $22 to $120. Bills for a similar home in Palm Terrace or Zephyr Shores went up by almost $9 to $132. Aqua customers pay among the highest rates in Pasco County.
It's unclear how much the latest staff recommendation might change those bills, since the rates vary by individual system. And, of course, the staff recommendation isn't the final word. The PSC is scheduled to take up the matter at its Feb. 14 meeting in Tallahassee.
Aqua officials said they, too, were still reviewing the PSC staff recommendation, but said the overall request for higher rates was necessary to fund system improvements.
"The overwhelming majority of Aqua's rate request is related to recovering about $11 million that Aqua spent from January 2008 through April 2010 to improve or replace water mains, wells, pumps and treatment systems and on other capital projects, such as tank rehabilitation and replacement, meter replacements and electrical upgrades, throughout Florida," the company said in a statement Friday. "Rate increases provide a way for utilities to recover capital and operating dollars so that we can continue to maintain and improve the systems that serve our customers."
Fasano is urging the PSC to deny the staff recommendation and set a lower water rate, arguing the utility provides "marginal quality of service." Regulators may consider the quality of service and customer satisfaction when setting the rates.
Last year, the PSC wrote the utility's water quality was "satisfactory" but that the overall quality of service was marginal. The order noted the "outpouring of customer frustration" and said there is "a disconnect between the utility and its customers." Residents have brought jars of cloudy or discolored tap water to the public hearings on Aqua.
In the proposed recommendation released this week, PSC staff deemed the utility's plant conditions and operations were "satisfactory."
"It is unimaginable to me that staff could state that the quality of service provided by Aqua Utilities is satisfactory," said Rep. John Legg, R-Port Richey, who has attended the utility hearings with his constituents. "I will continue to fight for the citizens of Pasco County, alongside Senator Fasano and others, to help hold entities like Aqua Utilities to the highest standard of care for some of our most basic needs."