Tennessee American Water has submitted its 2016 infrastructure projects to the Tennessee Regulatory Authority (TRA), which would result in a 4.40 percent water rate increase applied to all water charges.
TAW officials said, "It would be effective Jan. 1, 2016. This represents a 95-cent monthly increase on the average city of Chattanooga residential customer bill and allows Tennessee American Water to ensure continued investment in local water systems while reducing the possibility of large rate increases."
Approved in 2014 by the Tennessee Regulatory Authority, the new alternative rate mechanism requires Tennessee American Water to annually submit its capital infrastructure projects for the following year and the costs associated with those projects to the TRA, it was stated.
Infrastructure capital projects planned for 2016 total almost $15 million. The largest capital infrastructure project planned will be an $8.6 million improvement at the Citico Water Treatment Plant, which will renovate a sedimentation basin to ensure Tennessee American Water continues to meet all state and federal drinking water standards.
TAW said, "Historically, general rate cases filed have asked for increases at a larger percentage. The alternative rate mechanism gives customers rate stability and allows Tennessee American Water to accelerate the replacement of aging water infrastructure, comply with increasing environmental standards, and support local economic development."
Valoria Armstrong, new president of Tennessee American Water, said, “Our customers play an important role because each time they make a water bill payment, they help to make critical improvements to the local water system.
“We plan these projects based on greatest need, balanced by the price our customers pay. We are also very careful to manage our costs by operating as efficiently as possible.”