On Wednesday, July 31, the Department of Public Utilities approved the rate increase request made by Housatonic Water Works.
In June 2023, the controversial company originally filed an application with the state’s Department of Public Utilities requesting a 112.7 percent overall revenue increase.
Back in April, the Office of the Attorney General, along with HWW, filed a proposed settlement in the rate case.
As proposed, HWW customer rates will be increased by over 90 percent over five years.
The settlement also includes a capital project list, including a manganese filter system, an interconnection with the Great Barrington Fire District, a new water storage tank, and a main replacement.
As per the DPU decision:
“Based on our review of the record in this proceeding, the Department finds that the Settlement is consistent with Department precedent, is in the public interest, and will result in just and reasonable rates. The Settlement provides the three Towns with an important opportunity to participate on behalf of their residents and businesses in the decision making regarding whether the Company should proceed with the Great Barrington Fire District Interconnection, Water Storage Tank, and first stage of the Company’s ten-year main replacement project. In addition, final recovery of the project costs will not occur until the Department has reviewed and approved these costs in future proceedings.
The Department recognizes that the magnitude of the proposed rate increase is significant. We also acknowledge that the Company has significant capital investment obligations and, therefore, must ensure that the rates are sufficient to ensure the financial viability of the Company to the benefit of its ratepayers. In doing so, the Department often faces the difficult choices that must be made in balancing the numerous concerns of utilities, the customers they serve, public officials, and other regulatory bodies with the goal of providing higher quality water and improved service at the lowest possible cost. This case is particularly challenging given the long-standing public dissatisfaction with the Company’s quality of service.
The Department’s approval of the Settlement is based on our expectation the Company will aggressively seek to minimize its capital project costs through grants and the use of low-cost financing programs. If the Company does not comply or the directives do not lead to continued improvements in overall service quality, the Department will consider taking remedial action.
Regarding the Company’s water discoloration issues, Housatonic Water represents that it conducted extensive testing to identify potential causes of water discoloration in its source of supply other than manganese concentrations. The Company opines that, based on test data and analysis by its engineers and consultants, the primary source of discoloration is the presence of manganese at Long Pond. All issues regarding the prudence of the Manganese Filtration System will be thoroughly considered in our review of the Company’s 2025 compliance filing.
The Department acknowledges the deep frustration voiced by the Company’s customers in this proceeding and the desire by many for the Department to facilitate the sale of Housatonic Water to Great Barrington or some other entity. While the Department must approve any sale of Housatonic Water, the Department does not have the authority to force a sale to another entity as requested by some commenters. The Company’s legislative charter authorizes Great Barrington to purchase the Company, conditioned on the assent of the residents of Great Barrington by a two-thirds favorable vote at a town meeting called for that purpose, and further specifies the purchase price formula to be used. St. 1897, c. 229, § 6. Accordingly, a change of the Company’s ownership must occur either in accordance with the provisions of the charter or through a voluntary sale by Housatonic Water.”
The full DPU decision can be found at this link.
