Indiana's largest water utility, Indiana-American Water Co., has requested a rate increase of nearly 20 percent, deeming the increase fair and necessary to cover operating costs and to make a profit on its investments.
Some customers could see their average bills increase from about $15 to $23 a month.
Indiana-American may have strayed into the deep end this time. Why is the customer responsible for this money when investors should be providing the necessary funds for this kind of financial movement? Isn't 20 percent a bit steep?
Indiana's consumer advocate agency believes the company should only receive one-third of the requested increase because, otherwise, customers are being asked to cover Indiana-American's expansion and acquisition costs.
"We do not believe those costs should be passed on through rates," said Anthony Swinger, consumer counselor office spokesman.
A rate increase would affect some 262,000 customers across 35 communities, and, at a rate of 20 percent monthly, would provide an increase of approximately $2 million for the company straight from the pockets of customers, not investors.
Hearings before the Indiana Utility Regulatory Commission are being held across Indiana during the next month.
While this increase may be needed, it is not fair for Indiana-American to gouge the communities it serves. Instead, investors should provide a bigger portion of the funds to keep the customer well from running dry.