FORT WAYNE – Aqua Indiana’s rate increase request should be dramatically reduced, but the private utility should still be allowed to slightly raise its rates, according to testimony filed Tuesday by the state utility consumer advocate.

The Indiana Office of Utility Consumer Counselor recommended Aqua Indiana’s water rates be allowed to rise 3.28 percent and its sewer rates to increase no more than 4.49 percent. The company is seeking a 16.64 percent water hike and an 18.48 percent sewer increase.

According to the counselor, if the lower rate increase is approved, customers using 5,000 gallons of water a month would see their water and sewer bill increase a total of $3.03. The company’s proposal would have raised the bill by $13.48.

The utility has about 12,000 water customers and 12,000 sewer customers – not all have both utilities – in Allen County and a small portion of Whitley County.

The state received a glut of public opposition to the utility’s rate increase. Anthony Swinger, counselor spokesman, said the state received written comments from 705 residents, including letters, e-mails and petition signatures. This was in addition to the numerous people who spoke against the proposal at a public hearing last month.

In addition to the amount of opposition, the proposed increase drew high-profile foes such as Sen. David Long, R-Fort Wayne, and the three Allen County commissioners all publicly criticized Aqua Indiana’s rate request. Part of the opposition centered on the 75 percent increase in the company’s water and sewer rates that took effect in June 2009.

Aqua Indiana officials previously said the new rates were needed to finance $10 million worth of improvements to the system.

Fort Wayne City Utilities on Tuesday filed its 83-page testimony opposing the rate increase. Ted Nitza, a City Utilities consultant, said in the document that Aqua Indiana could have avoided many of its infrastructure costs by partnering with the city’s utility system. This could have included buying water wholesale from the city, which could have prevented Aqua from spending money to soften its water.

“The City of Fort Wayne is available and interested in assisting (Aqua Indiana) to provide potentially more cost effective drinking water services to their customers, most of whom are city residents,” Nitza wrote.

Both the city report and the state counselor opposed Aqua Indiana’s attempt to raise rates in part to collect more than $500,000 in legal expenses regarding a settlement to keep a sewer plant open. The company paid two area neighborhoods a combined $2.6 million to keep the nearby plant open, which was supposed to shut down according to an agreement with the utility’s previous owner.

“The utility and not the ratepayers should bear the cost of any imprudent decision by prior management,” the state report said.

Aqua Indiana is scheduled to file its rebuttal by Sept. 16, and an evidentiary hearing by the state will begin Oct. 5.

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