Two More Water Rate Hikes?

The Philadelphia Water Department has sent a letter to City Council stating the Water Department is seeking two consecutive water rate hikes totaling a 20% rate hike. This is on top of the two rate hikes it received in the previous two years.

If the past is prologue, the Water Department will get the support of the Community Legal Services’ lawyers, who claim to be the “Public Advocate” to raise our rates.

There are real questions as to why the Water Department needs the rate increase, who the Public Advocate represents, how the “Public Advocate” gets its contract. And why consumers are no longer represented before the rate-making body, the Philadelphia Water Rate Board, unless they hire their own lawyer or represent themselves.

Despite being called the “Public Advocate,” the contract it is given specifies, “The City and Provider (Community Legal Services) desire that Provider renders general consultant services to the City in accordance with the provisions of this Provider Agreement . . .” The Chair of the Water Rate Board made it more explicit in his written decision to raise water rates for the second consecutive year: “Neither the “public” in general nor Mr. Haver in particular is the “client” of Community Legal Services (CLS), a vendor providing certain specified non-legal services under contract with the Rate Board. If the Rate Board is dissatisfied with the services rendered, it can take whatever appropriate action is available under that contract”.
(Rate Board Decision, Page 22).

The rate board has been so satisfied with “the Public Advocate” acquiescing to two consecutive rate hikes the board has renewed the “Public Advocate’s no-bid contract for three consecutive years. The minutes of those meetings show no public input, no questions asked, and no benchmarks set.

There is no requirement for the “public advocate” to create a public client group, seek input from the public, or in any way seek public input before the Public Advocate agrees to still another rate hike. Neither the “Public Advocate” nor its law firm was required to fill out financial disclosure forms that would show any finical conflict of interest with the Water Department or its vendors. The only written requirement is that the “Public Advocate” keep the rate board, which contains a previous water commissioner, satisfied.

Relying upon the “satisfaction” of the rate board, rather than the “satisfaction” of the public, the people paying the bill, may explain the reluctance and refusal of the “Public Advocate” to investigate, on the record, what the Water Department could do to save money. For example, the Public Advocate has never asked the Water Department how much money could the Water Department save if it combined services with the City’s other municipal utility, Philadelphia Gas Works. As a result, the Water Department, instead of combining meter reading, billing, and collections with PGW, is spending 10’s of millions installing new meters. The unchallenged decisions of the Water Department are so flagrant that when the Water Department gave an installation contract to a private profit-making company located in Georgia, the “Public Advocate” didn’t challenge the decision in the last two rate cases. As a result, we call Georgia, where the jobs are created, when we call to schedule the required water meter replacement.

The Water Department keeps hundreds of millions of dollars in its surplus fund in a bank that has no retail branches in Philadelphia. The Public Advocate has never objected. The Public Advocate, in the last two rate proceedings failed to demand that the Water Department become part of the City’s economic development team to bring clean, water-using companies into the City.

In the new proposal, a 20% rate increase, the Water Department is attempting to force consumers to pay for the Water Department’s failure to get more Federal or State “Covid” dollars, failures to find significant cost savings by combining services with PGW; failure to bring in new clean, water-intensive industry and failure to help low-income consumers sign up for low-income plans. The question is, what position will the Public Advocate take?

We reached out to CLS for comment, and they directed us to this statement on their webpage:

The Water, Sewer, and Storm Water Rate Board did not return a request for comment.

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