United Water Idaho’s rate hike: Public Utilities Commission staff has six months to review proposal

The Idaho Public Utilities Commission suspended United Water Idaho’s rate increase for six months while its staff reviews the proposal.

United Water, which provides water to about 90,000 business and residential customers in Boise, parts of Eagle and some unincorporated areas of Ada County, filed a request for a 13.2 percent rate increase May 21. If approved, the average residential bill would rise about $4.22 per month.

United Water wants to increase the bimonthly customer service charge for small-service customers to $23.55, up from $20.08. For larger customers that use a 1-inch service line, the bimonthly charge would increase from $26.60 to $30.10.

The company also proposes to increase its charge by volume to about $1.66 per 748 gallons, up from $1.46. People who use a lot of water would see the additional increase charge rise to $2.07 from $1.83. Annual revenues to United Water would increase by $5.88 million if the commission approves the full requested amount.

United Water said the increase is needed to recoup more than $39 million of investment in its water system since the last rate increase in 2011. The capital improvements include $17.2 million to replace aging water mains and meters, $3.5 million to replace treatment facilities, $900,000 for a replacement storage tank in the Bogus Basin Road area and $500,000 for auxiliary power equipment to ensure uninterrupted water supply during electric outages.

United Water is seeking an 8.45 percent overall rate of return and 10.4 percent return on equity. It claims its current rate structure results in a 6.43 percent rate of return.

The company also wants to make several changes to its customer service rules, including one that would allow United Water to terminate service without prior notice if a customer fails to install, maintain or annually test a backflow prevention device and a dangerous condition is present.