MADISON - After 15 years without a rate increase, the Monticello Water Utility will hike rates by 75 percent for residential customers Friday, according to documents filed with the Public Service Commission.
Average residential customers currently paying $19.33 monthly for 3,000 gallons of water will pay $33.75 for the same amount of water under the new rates.
Rates for multifamily, commercial, industrial and public authority customers will increase between 49 and 73 percent depending on customer class and usage, according to the PSC rate order.
Six customers appeared at the Feb. 25 public hearing on the requested rate increase, with one in support and five undecided.
The new rates put Monticello above the state average for similar size water utilities in the state, according to the PSC order.
Despite not raising rates since 2001, the utility posted annual operating incomes of $47,609; $52,883; $28,409; and $30,141, from 2012 to 2015, respectively; but projected earnings for 2016 fell to $11,490, when PSC staff reviewed the utility's finances in February.
During the past five years, annual revenue increased slightly from $238,451 to $252,591 but the rate of expenses grew faster, climbing from $190,842 to $241,101, according to PSC analysis.
Increased expenses were led by repairs, employee pension and benefits, hiring outside services, insurance and general supplies. Salaries and wages declined during the same time span.
Without the new rates, the utility projected earning only a .64 percent rate of return on the value of its infrastructure investment.
The new rates are estimated to boost annual revenue by $116,272 to $368,863 and earn the utility an $113,601 net income and 5.25 percent rate of return, according to the rate order.
When the utility filed a rate application in September, village Clerk DaNean Naeger said more revenue was needed to finance the cost of a new pump house near East Coates and North Main streets, which the Department of Natural Resources recommended in 2012.
The project was initially estimated at $180,000 but actually cost the utility $345,000 and resulted in the PSC issuing the utility a letter of reprimand last week for failing to seek advance approval for a project exceeding $271,000.
Last week, village President LaVerne Crooks said Monticello was at fault for not getting the project pre-approved.
"It's solely the responsibility of the village to give the PSC the information and we completely failed to do it so. We take full responsibility," Crooks said in a phone interview.
The PSC did state that the project was necessary to ensure reliability of the water system and otherwise constructed in compliance with state statutes.
Crooks also said the utility would probably be filing rate requests more frequently as it now has software to better track and forecast revenue and expenses.
Average residential customers currently paying $19.33 monthly for 3,000 gallons of water will pay $33.75 for the same amount of water under the new rates.
Rates for multifamily, commercial, industrial and public authority customers will increase between 49 and 73 percent depending on customer class and usage, according to the PSC rate order.
Six customers appeared at the Feb. 25 public hearing on the requested rate increase, with one in support and five undecided.
The new rates put Monticello above the state average for similar size water utilities in the state, according to the PSC order.
Despite not raising rates since 2001, the utility posted annual operating incomes of $47,609; $52,883; $28,409; and $30,141, from 2012 to 2015, respectively; but projected earnings for 2016 fell to $11,490, when PSC staff reviewed the utility's finances in February.
During the past five years, annual revenue increased slightly from $238,451 to $252,591 but the rate of expenses grew faster, climbing from $190,842 to $241,101, according to PSC analysis.
Increased expenses were led by repairs, employee pension and benefits, hiring outside services, insurance and general supplies. Salaries and wages declined during the same time span.
Without the new rates, the utility projected earning only a .64 percent rate of return on the value of its infrastructure investment.
The new rates are estimated to boost annual revenue by $116,272 to $368,863 and earn the utility an $113,601 net income and 5.25 percent rate of return, according to the rate order.
When the utility filed a rate application in September, village Clerk DaNean Naeger said more revenue was needed to finance the cost of a new pump house near East Coates and North Main streets, which the Department of Natural Resources recommended in 2012.
The project was initially estimated at $180,000 but actually cost the utility $345,000 and resulted in the PSC issuing the utility a letter of reprimand last week for failing to seek advance approval for a project exceeding $271,000.
Last week, village President LaVerne Crooks said Monticello was at fault for not getting the project pre-approved.
"It's solely the responsibility of the village to give the PSC the information and we completely failed to do it so. We take full responsibility," Crooks said in a phone interview.
The PSC did state that the project was necessary to ensure reliability of the water system and otherwise constructed in compliance with state statutes.
Crooks also said the utility would probably be filing rate requests more frequently as it now has software to better track and forecast revenue and expenses.