The City of Alexandria has issued a formal objection to a water rate increase proposed by Virginia American Water.
Virginia American Water, a statewide utility company, requested authority from the state to increase its rates to create a sales revenue totaling $14.3 million — a 27.6% increase over current revenues.
The City of Alexandria said under the requested rate increase, the bill for the average residential customer using 4,500 gallons of water per month would increase by about 40% — around $117 per year. Residential customers with above average water use could see their bill increase by more than 50%.
“At the direction of Alexandria City Council, the City has formally objected on behalf of Alexandria’s water customers to Virginia American Water’s request to the State Corporation Commission to raise water rates,” the city said in a release. “The City’s primary objections are that the company’s proposed return on equity, or profit margin, should be lower; the rate of bill increases should be gradual and representative of national averages; and costs of serving customers should be appropriately and fairly allocated among residential, commercial, and industrial customers.”
In the release, the City of Alexandria said the public is encouraged to submit comments opposing the requested increase with the State Corporation Commission by Sept. 20. Comments can be submitted online by picking “submit comments” for case PUR-2021-00255. The City said locals should indicate that the rate increase should be phased more gradually with a lower return on equity.
“While Virginia American Water is an important partner in Alexandria’s water system, the City has a responsibility to the community to speak up when rate increases are too aggressive,” said City Manager James Parajon. “Increases are needed from time to time in order to maintain and improve aging infrastructure, but they must be structured and paced fairly and equitably.”
The Commission is scheduled to hold a public hearing on Friday, Sept. 23, at 10 a.m. via phone and another hearing on Tuesday, Sept. 27 at the same time that will be accessible online.