Philadelphia Water Department Requests Rate Change

For immediate release: March 14, 2018
Contact: Laura Copeland Laura.Copeland@phila.gov (215) 685-4902

 

Water Department Requests Rate Change to Replace and Maintain Critical, Aging Infrastructure 

PHILADELPHIA—The Philadelphia Water Department today filed a notice of proposed changes in rates, to provide the utility with resources needed to better maintain one of the oldest water systems in the country.

The Water Department is responsible for the maintenance and replacement of more than 6,000 miles of water mains and sewers.  Philadelphia experienced 715 water main breaks between July 1, 2016 and June 30, 2017—a number that represents water service disruptions and potential flooding to approximately 700 neighborhood blocks. And this past winter season was especially challenging, with 625 water main breaks in just over three months.

These breaks are not just inconvenient. In some cases, flooding and property damage has briefly displaced residents from their homes, and multiple large breaks can cost the City millions of dollars per year in customer claims related to damaged homes and cars. This increase in main breaks is due, in part, to aging infrastructure since the average age of a water main in Philadelphia is about 70 years.

The Water Department is a cost of service utility and does not profit from rate increases. The proposed 10.6 percent increase would raise the typical residential bill $7.00 per month by September 2020. The chart below breaks down the changes a typical residential customer would see. Media and the customers are encouraged to view a detailed information package explaining how rates are used and why the increase is needed.

Monthly bill for a typical residential customer:

Fiscal year	Requested increase of monthly bill	Additional monthly water & sewer charge	Average monthly Bill total
Current	None	None	$66.50
September 1, 2018	1.1%	$0.77	$67.24
September 1, 2019	5.0%	$3.36	$70.60
September 1, 2020	4.5%	$3.19	$73.79

• Typical bill represents households which have a 5/8-inch water meter and use 500 cubic feet of water (3,740 gallons) per month

The Water Department is requesting the rate increase because it needs additional revenue to address increasing operating costs and to continue to achieve financial metrics to maintain its favorable credit rating. Keeping a favorable rating will help mitigate future borrowing costs associated with the Water Department’s capital program to upgrade water and wastewater treatment plants as well as water main and sewer replacement.

This rate change request is subject to approval by the Philadelphia Water, Sewer and Stormwater Rate Board. In 2012, voters approved the creation of this independent rate-making board, which is responsible for setting and regulating water and sewer rates.

The rate setting process requires the Water Department to provide documentation proving that any requested rate change is fair and justified. Pursuant to the Board’s directive, six public input hearings have been scheduled in addition to technical hearings. Customers can find public hearing dates and locations .   

In addition to participation in public hearings, affected customers can inform the Rate Board (via letter or in person) of their intention to participate in technical hearings on or before March 21, 2018. All public meeting information will be posted at on the Rate Board website and advertised via print and broadcast media as it becomes available. For more information on participating in the rate process, visit www.Phila.gov/water/rateboard.

Customers interested in learning more about water main breaks and the urgent need to address our aging infrastructure are encouraged to visit www.Phila.gov/water/.

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About the Philadelphia Water Department: The Philadelphia Water Department serves the Greater Philadelphia region by providing integrated water, wastewater, and stormwater services. The utility plans for, operates, and maintains both the infrastructure and the organization necessary to purvey high-quality drinking water to provide an adequate and reliable water supply for all household, commercial, and community needs, and to sustain and enhance the region’s watersheds and quality of life by managing wastewater and stormwater effectively. www.phila.gov/water