AWWA ACE91122

The expense and complexity of proposing a rate increase may be intimidating for small utilities. To clarify the process and offer tips on simplifying it, the author leads readers step-by-step through the process of applying for a rate increase, using the state of Missouri as the example. The author first suggests underlying tasks, such as keeping good records, keeping current on business issues, planning for necessary improvements, and keeping staff informed. Timing the proposal for a rate increase is critical: too soon, and some costs that need to be covered may not be included. The timing of a proposed rate increase should be take into account capital investment in a plant; changes in water use brought about by conservation or industrial shut-downs; changes in expenses, such as an electrical rate increase, and the availability of staff to work on the proposal.