Cost savings associated with the tax reform bill passed by congressional Republicans last year could mean lower water bills for area residents.
In January, the West Virginia Public Service Commission directed all privately owned electric, gas, water, sewer and solid waste facilities to begin tracking the savings resulting from the 2017 Federal Tax Cuts and Jobs Act on a monthly basis. Utilities involved in this proceeding also included Appalachian Power, Mountaineer Gas and Bluefield Gas Company.
West Virginia American Water Company announced a settlement plan last week which — if approved by the PSC — would result in an average savings of $3.77 a month for water and sewer customers in the state.
“The recent federal tax reform will save our customers an estimated $4.6 million annually, so we are passing these savings on to our customers beginning next month,” Brian Bruce, president of West Virginia American Water, said in a prepared statement last week. “We also plan to use these savings to lessen rate increases going forward.”
Bruce said taxes are part of a utility’s cost of providing service and are typically incorporated into utility rates set by the PSC in periodic rate cases, but given the federal tax reform and its benefit to customers, “we agreed with the parties in this case to pass these benefits to customers sooner than the usual process allows.”
The PSC is scheduled to consider the West Virginia American Water company case this Friday. The commission also directed other utilities conducting settlement negotiations to file proposed settlements at or before Friday’s hearing.
If approved as proposed, West Virginia American Water would reduce its rates by an average of 3.5 percent, effective Sept. 1, to reflect its federal tax savings from Sept. 1 until the PSC sets new rates in February 2019. That would provide a savings to customers of about $2.2 million.
For the average residential customer, the monthly savings will be $1.60 for water and $2.17 for wastewater.
It is rare to hear about a rate decrease. We urge the PSC to approve the rate reduction plan sought by West Virginia American Water.
Many families in our region are on a fixed income, and need all the help they can get when it comes to meeting the expenses associated with their monthly utilities bills. Any, and all, decreases will help.