Water rates in Shawano Lake Sanitation District No. 1 are going up about 14 percent.
The district serves about 2,274 residential accounts along Shawano Lake in four municipalities.
The Wisconsin Public Service Commission on Thursday issued a new rate order for the district, which had not sought a major rate increase since 1999. But, as the district told the commission, after 14 years its net annual income had diminished to $17,257, prompting the rate request filed in July.
Average residential customers currently paying $20.31 quarterly for 6,000 gallons of water will pay $23.10 for the same volume under the new rates.
The new rates will be in effect when meters are next read, on Dec. 11, Jerry L. Weisnicht, the district’s administrator, said Friday.
According to the rate order:
Rates for the several classes of commercial customers will increase from 3 to 12 percent depending on meter size and usage, industrial customers will pay 7 percent more and public authorities will pay 6 to 9 percent more.
The amount collected for public fire protection, fire hydrant maintenance and related expenses will remain the same at $123,547.
The district bills the town of Westcott and Washington and the village of Cecil for the municipalities’ share of public fire protection costs. The district bills city of Shawano residents directly for public fire protection costs on their water bills.
The percentage rate increase to any individual customer will depend on the consumer’s specific consumption.
Typical bills remain below the state average for utilities of similar size, according to the rate order.
The rate order also increased the standard residential meter charge from $10.95 to $12 per quarter.
The district received about everything it requested in a rate application filed in July, Weisnicht said.
“We wanted to eliminate standby charges for vacant lots and that was approved,” he said.
The charge once was popular with water utilities, but recently the PSC has been asking them to discontinue the practice. Under a standby charge, vacant lot owners pay a $9-per-foot fee quarterly if a water main crosses their undeveloped property. With the charge now gone, the district expects to make up the revenue loss in volume or meter charges, Weisnicht said.
The new rates will boost district revenue by $28,137 annually to $478,501. Total expenses for 2014 are estimated at $433,177, leaving the utility with a $45,395 net operating income and a 5.75 percent rate of return on the $789,457 net value of its infrastructure investment.
Weisnicht would not guarantee that the district could sustain another 14 profitable years before seeking another rate increase.
While revenue and normal operating expenses should be stable during the next several years, the state Highway 22 bridge project may cost the district $250,000 to move water and or sewer lines from the north to the south side of the road, Weisnicht said.
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