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American Water Increasing Water Rates Yet Again

February 8, 2010

In the continuing saga of American Water and its wide scale requests for large increases in water utility rates in its service areas nationwide, we find the latest such request for its Arizona affiliate. Water Utility Rates will go up in Sun City, AZ by 28% and wastewater rates by 40% under Arizona American’s proposal.

Not surprisingly, the local community is organizing opposition to the proposal.

In the news on the same day, we see the El Dorado Irrigation District in California reduce its planned water rate increases by 50% after voters staged a protest to the board of directors (board seats are elected offices).  The contrast between the two cases is helpful in showing some of the differences that exist between private company approaches to utility rates and the process for publicly owned utilities. Arizona American is going forward with its proposal regardless of outcry from the local community; the El Dorado District repealed half of its proposal.

We often hear the argument that private companies are better equipped than government to provide utility services for local communities.  If you read through all of the big water rate increases that private companies are proposing listed on this site alone, you will start to see that there is a strong argument that private companies are actually not providing services at lower rates, and that local communities may find themselves mostly at the companies’ whims when it comes to how, when, and why the companies increase rates.

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