The Chattanooga Manufacturers Association on Monday joined the fight against a proposed 27.7 percent rate increase from Tennessee American Water.
In a filing with the Tennessee Regulatory Authority, attorneys for the manufacturers group said the request for another $10 million for the water utility “is not fair, not reasonable and not in the best interests” of ratepayers “and should be rejected by the authority.”
The consumer advocate for the Tennessee attorney general filed similar objections to the proposed increase two weeks ago.
“These filings for rate increases by the water utility seem to keep getting bigger and more frequent,” said Tim Spires, executive director for the Chattanooga Manufacturers Association, the nation’s oldest manufacturing trade group. “The economy is still tough for manufacturing, and it’s very, very hard to pass along any cost increases, let alone one of this size.”
The manufacturers group, which has intervened to oppose each of the proposed water rate increases from Tennessee American over the past two decades, has hired Nashville attorney Henry Walker and Chattanooga attorney David Higney to intervene against the rate case before the Tennessee Regulatory Authority in Nashville.
Tennessee American Water, the state’s biggest private water company, asked regulators last month to be allowed to boost rates next year to offset increased operating costs, fund increased employee pension costs and boost the allowable rate of return earned by the company. Without any rate increase, Tennessee American President John Watson said the company will lose money next year.
The proposed increase would boost the average residential water bill in Chattanooga by $4.68 a month, or 15 cents a day, if fully approved by regulators.
In response to the utility’s last request for a 21.7 percent rate increase in 2008, the Tennessee Regulatory Authority granted the water company less than a 4.4 percent increase.
Kim Dalton, a spokeswoman for Tennessee American, said the company “respects the decision” by the manufacturers’ group to intervene in the case, as it has in most all of the previous water rate requests of the past two decades.
“It is part of the process, which is a six-month proceeding,” she said.
State regulators must decide how much, if any, of a rate increase to grant for the Chattanooga water utility by next March.
Contact Dave Flessner at dflessner@timesfreepress.com or 423-757-6340.