Robert F. Powelson: Scrutiny will benefit PWSA customers

The realities of America’s growing water and wastewater infrastructure challenges are front and center in Pittsburgh. The Steel City’s vital infrastructure has long exceeded its life span.

Across the country, water utilities, in close collaboration with a diverse range of stakeholders, are proactively addressing some of their failing infrastructure challenges. This includes investment in new pipeline infrastructure, leak detection technologies and accelerated water quality treatments. The Pittsburgh Water and Sewer Authority (PWSA) is no exception.

As a result, PWSA customers’ rates are increasing to cover the costs of the long overdue infrastructure improvements.

The public nature of the current process differs vastly from how PWSA conducted business and increased rates just a decade ago.

The Pennsylvania General Assembly passed, and the governor signed into law, Act 63 of 2017, which granted the Pennsylvania Public Utility Commission (PUC) oversight of PWSA to include customer service, operations performance, long-term infrastructure planning and rate-making. This action put PWSA on par with the state’s privately owned water and wastewater utilities such as Aqua Pennsylvania, PA American Water, Veolia and York Water.

When a PUC-regulated utility seeks a rate increase, it must file a request with the commission and prove that the increase is needed. Under the state’s Public Utility Code, the PUC is charged with assessing the request to ensure the “lowest reasonable rate” for consumers and the proper amount of investment to maintain safe and reliable service. The PUC process can take up to nine months.

Under the PUC, consumers have opportunities to participate in the rate-making process and can do so by submitting written comments or testifying before the administrative law judge. The Pennsylvania Office of Consumer Advocate also participates in the formal rate proceeding and is statutorily charged with being the voice of consumers. The state’s Office of Small Business Advocate, commercial and industrial customers, and other consumer advocate organizations also regularly participate in the process.

It’s a process that is familiar to the state’s private, regulated water and wastewater utilities. The public and transparent process is vital because it sheds light on exactly where your family’s water and wastewater dollars are going.

PWSA is working through this process now as it seeks to recover the costs of repairing the aging system. Thousands of pages of testimony have been submitted as part of the case. Six public input hearings were held by the PUC.

Without the checks and balances of utility commission oversight, far too often local politicians focus only on the next election and how a water rate increase would impact their chances at the ballot box instead of vital infrastructure needs that are buried far underground.

Such was the case in Pittsburgh. In the years leading up to the PUC being given jurisdiction over the authority, independent audits and a 2017 Blue Ribbon panel all said something had to be done to prevent PWSA from being hijacked by the priorities coming from city hall.

Pittsburghers now are playing catch-up for the decades when the can was kicked down the road and necessary investments in the water system were not made.

Increasing the cost of water and wastewater service is never popular with consumers. The PUC model of rate regulation works to ensure safe, reliable and affordable service by removing politics from the rate-making process. Instead, it is put into the hands of independent utility experts who are focused on long-term consumer and infrastructure needs.

America’s private regulated water companies undergo this scrutiny from utility commissions regularly, meaning those customers can have every confidence their water and wastewater company is providing safe, reliable service that is affordable and we believe PWSA’s customers will similarly benefit.

Robert F. Powelson is the president and CEO of the National Association of Water Companies (NAWC). He previously served on the Federal Energy Regulatory Commission and the Pennsylvania Public Utility Commission.