Iowa Utilities Board Approves New Rates for Iowa American Water

$26 million in infrastructure investment drives need for rate adjustments; Water service will remain a value at about a penny per gallon for most households

DAVENPORT, Iowa--()--On February 28, 2014, the Iowa Utilities Board (IUB) issued its final order in Iowa American Water’s rate case that was filed on April 30, 2013. On April 18, 2014, the IUB approved the company’s rate design and set an effective date of April 18, 2014.

The need for the rate adjustment was driven primarily by significant investment made by the company to improve and replace water infrastructure. According to Randy Moore, president of Iowa American Water, the company has invested approximately $26 million in water system improvements statewide in the last two years to ensure continued high-quality water service.

“Proactive water system upgrades today save money in the long run,” Moore said. “All these investments in local water infrastructure systems enhance water quality, service reliability and fire protection for customers while keeping the cost of water service for most local households at about a penny per gallon.”

Some of the larger investments in local infrastructure include:

  • About $15 million investment for normal, recurring installation and replacement of water pipelines, services, meters and hydrants.
  • $6 million, multi-year investment in information systems and technology to more effectively support our customer service and business needs.
  • $3.4 million investment over several years for the U.S. Corps of Engineer’s Flood Protection Project that will safeguard the East River Station Treatment Facility to the 200-year flood level. Iowa-American Water is partnering with the federal government and city of Davenport on this $11.5 million project that will protect the drinking water supply for over 130,000 people when complete in 2013.
  • $1.2 million investment, of which $800,000 was spent in 2012, on Camanche Avenue in Clinton to relocate and replace approximately 1.5 miles of water main in conjunction with the IDOT Highway 30 Improvement Project.
  • $500,000 investment to replace aging heating units in three treatment buildings which had come to the end of their useful lives.

The need to upgrade water systems is not only an issue for Iowa American Water; it is a national issue. The American Society of Civil Engineers says that an estimated $1 trillion in capital spending will be needed across the nation over the next 25 years to replace aging water infrastructure and to comply with stricter water quality standards.

Effective April 18, 2014, the rates approved by the IUB increased the water service cost slightly above the interim rates put into effect on May 10, 2013. The average residential customer using 4,200 gallons per month will pay about $0.03 cents more per day or $0.95 more per month bringing their average monthly water bill to $35.19.

“As a utility whose services are critical to ensuring public health, we take our responsibility to provide quality drinking water seriously, and as such, are committed to keeping our systems and facilities well maintained and services,” added Moore. “Even with this increase in rates, water service remains a good value for our customers at about a penny a gallon.”

Customers can contact American Water's call center toll free at 1-866-641-2108 with additional questions.

Additional information can be found on the Iowa Utilities Board’s website at www.state.ia.us/iub/.

Iowa American Water, a subsidiary of American Water Works Company, Inc. (NYSE: AWK), is the largest investor-owned water utility in the state, providing high-quality and reliable water services to approximately 200,000 people. Founded in 1886, American Water is the largest publicly traded U.S. water and wastewater utility company. With headquarters in Voorhees, N.J., the company employs approximately 6,600 dedicated professionals who provide drinking water, wastewater and other related services to an estimated 14 million people in more than 40 states and parts of Canada. More information can be found by visiting www.amwater.com.

Contacts

Iowa American Water
Lisa Reisen
Manager, External Affairs
563-468-9221
Lisa.Reisen@amwater.com

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Contacts

Iowa American Water
Lisa Reisen
Manager, External Affairs
563-468-9221
Lisa.Reisen@amwater.com