Customers of Indiana American Water could see their bills climb nearly 8 percent by mid-2020 under a settlement agreement reached with consumer groups.
The utility, with 1.3 million customers across the state, announced the settlement agreement Tuesday morning. It would raise $17.5 million annually, down from the utility’s original request of $38.8 million. The revenues would help pay for more than $542 million in infrastructure investments.
Under the agreement, the rate increases would be implemented in two steps, with the first increase this summer of 1.73 percent and a second increase next summer of 6.07 percent.
The utility said the combined hikes would increase a residential customer’s bill by about $2.41 a month for a consumer using 4,000 gallons of water per month.
The settlement agreement still must be approved by the Indiana Utility Regulatory Commission. A hearing is scheduled for April 11.
The utility has about 302,000 customers in central Indiana, including in Noblesville, Greenwood, Shelbyville, Franklin and Mooresville. It is owned by American Water Works, based in Camden, New Jersey.
“We have made significant investments to aging infrastructure over the last several years to ensure service reliability, water quality and fire protection for our customers across the state, while holding our operating and maintenance expenses relatively flat,” company president Deborah Dewey said in a statement.
The settlement parties included the company, the Indiana Office of Utility Consumer Counselor, Citizens Action Coalition of Indiana, the Indiana Community Action Association, industrial customers, municipal governments and Sullivan-Vigo Water Corp.
“It provides a reasonable balance needed for safe, dependable water and fair rates to cover the costs, said Bill Fine, Indiana Utility Consumer Counselor.