Lexington opposes Kentucky American Water rate increase request

LEXINGTON, Ky. (WKYT) - Kentucky American Water customers could see higher bills in December. The company is asking state regulators to allow it to collect about $17.7 million more a year.

Kentucky American Water says a typical residential customer would pay about $8 more a month if regulators approve the increase.

Lexington has joined the rate case to oppose the request. Mayor Linda Gorton says the latest request is too much, too soon.

“This is the third rate increase they have asked for in 3 years; I mean, it’s really outrageous, this is the second one in 12 months,” Gorton said. “Someone has to stand up for the people, and that I think is my job.”

Company’s response

WKYT asked Kentucky American Water for an interview. A spokesperson sent the rate case and the company’s May press release.

In the press release, issued in May immediately after the company requested new rates, the company said annual rate increases are not typical for Kentucky American Water but are necessary this year to support needed infrastructure to continue providing reliable, quality service.

The company says it plans to spend about $108 million on system improvements next year. The company says those plans include replacing aging pipes and upgrading treatment facilities.

Accountant disputes request

An accountant testifying for Lexington, the Attorney General, and Georgetown disputes the company’s request. The accountant told regulators the company could reduce rates instead.

Gorton said she and her staff have not heard specific examples of why another increase is needed.

“It has to be transparent so that we, the people paying the bills, can see what we’re paying for,” Gorton said.

Kentucky American Water says new rates would take effect on an interim basis in December, with any difference subject to a refund after a final decision.

The Public Service Commission is reviewing the request.