When you open your Philadelphia Water Bill, you may be surprised to find that your bill has gone up again for the fourth consecutive year. This year, the combined rate increase of base rates and increases to pay for a low-income plan averaged 12%.
You may be surprised because the Philadelphia Water Department (PWD) and Philadelphia Water Rate Board (Rate Board) have yet to disclose the size of the combined rate increase.
PWD’s web page lists last year’s rate increase but not this year’s.
“Rate Changes Effective September 2023
The decision to raise base rates on September 1st, 2024, was made in June 2023. With the support of the “advocate” it hired, the Rate Board granted PWD two additional rate increases: One in 2023 and one in 2024. The decision states: “These increases are intended to generate additional first-year revenues of approximately $80.41 million above current rates in FY 2024 and total additional revenues of approximately $162.131 million above current rates in FY 2025.
An additional rate increase added to the $162 million increase, which was passed in June of this year, states: That decision states: for service rendered on and after September 1, 2024, the Department should be permitted to put the settlement TAP-R rates into effect as set out in the JointSettlement Petition, Exh. 1 with charges for water and sewer service set at $3.08/Mcf (water) and$4.40/Mcf (wastewater).
For most of us, the written decisions increasing our bills are indecipherable. We don’t know what the words mean. It is hard to believe that is an accident, especially when PWD’s web page doesn’t disclose the new, higher rates. The Chair of the Rate Board, in announcing the additional rate increase in June 2024, claimed he did not know the percentage increase being placed on consumers.
In the last four years, the rate increases have been supported by the “advocate” the Rate Board hires to represent the public. According to the Rate Board, the “advocate” doesn’t represent the public, and the public has no control over the positions the advocate takes or its decision to support four years of double-digit rate increases.
The Rate Board is comprised of five people: the former Water Commissioner, the former chief legal counsel for Philadelphia Gas Works, a real estate developer, an investor, and a former consumer advocate. The Rate Board has refused to seek public input into hiring an advocate for ratepayers, what positions the advocate should take, and whether the public believes they are adequately represented.
This year, with the support of its “advocate”, the Rate Board decided to prevent the public from protesting the rate increases by making all proceedings “virtual.” The public was not allowed to attend hearings, hold up signs, pass out flyers, or organize other ratepayers to attend council hearings.
What makes the “advocate’s” decision to support the 12% water rate increase surprising is the “advocate’s” statement on PECO’s proposed 12% increase. The “advocate”: “You’re going to see households not paying for prescription medication or other necessities, or diverting money from rent one month to try and pay their utility bill, and then diverting money from the utility bill the next month to try and pay their rent,”
If the harm to poor and working people is great, and it is, why does the “advocate” only oppose the PECO 12% rate hike and not PWD’s 12% rate hike? Could it be that the “advocate” is paid by agreement with the Water Rate Board with PWD dollars?
Does PWD need a double-digit increase? It has over 125 million dollars in surplus, has refused to combine services with PGW, another City-owned utility, and has yet to undergo a management audit in the last quarter of a century. Why would PWD do the hard work of finding efficiencies if it is given continual rate increases?
In defending its “advocate” from rate payer criticism, the Rate Board says the rate hike isn’t as high as PWD initially sought. As the “advocate’s” expert admitted, utilities always ask for more than what is needed.
There are real questions about how much PWD is wasting, how much it is not collecting from real estate speculators and absentee landlords, and how successful it has been in getting the City and State to use American Recovery Dollars to pay for infrastructure improvements. None of these issues were raised in the 2024 rate case.
It is still being determined if any Councilmember will raise the issue of four years of continual rate hikes in the new session of Council. Perhaps calling your Councilmember will make the issue harder to “hide under the rug”.
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