An Illinois American Water water tower is pictured in Bolingbrook. (Andrew Adams / Capitol News Illinois)
The two largest privately owned water utilities in Illinois are seeking to raise rates for a combined 1.5 million customers around the state.
Illinois American Water, which serves 1.3 million people, is seeking a $152.4 million rate increase. That corresponds to a $24 per month increase in water service bills and $5 per month increase in wastewater service for the average residential customer.
Aqua Illinois, which serves 273,000 people, is seeking a $19.2 million increase. That would bring with it $29.91 in bill increases, according to the Citizens Utility Board, a consumer advocacy group.
The requests must be reviewed by the Illinois Commerce Commission before the utilities are allowed to modify their rates. The ICC will then likely modify the requests to comply with state law, and it will respond to arguments presented by entities such as the Illinois attorney general, local municipalities and advocacy organization.
Decisions in the cases are expected by the end of the year, with water rates going into effect around the start of 2025.
To collect public input in the two cases, the ICC set up a series of five hearings around the state. While the first in Jerseyville was held on June 26, the rest are scheduled over the next two weeks.
Two hearings in the Illinois American Water case are scheduled for July 22 at the Levy Center in Bolingbrook and for July 23 at the Champaign Public Library in Champaign.
Two hearings on the Aqua Illinois case are scheduled for July 29 at McHenry County College in Crystal Lake and for Aug. 1 at Olivet Nazarene University in Bourbonnais.
All four hearings begin at 7 p.m. and run for either two or two and a half hours.
AARP Illinois, which advocates for Illinoisans age 55 and older, requested the hearings to give customers a chance to have “face-to-face” time with the administrative judge who is overseeing the case, according to Jeff Scott, an associate state director at AARP.
While his organization is not planning on formally testifying in the cases, it has been circulating petitions and conducting an education campaign with the goal of lowering the requested increases to fixed charges.
AARP said Illinois American’s request would increase the fixed monthly meter charges, which customers must pay no matter how much water they use, from $17.98 to $26.12. Aqua’s request would increase fixed charges for most customers from $19.47 to $21.95.
Scott said recent decisions to dramatically reduce requested rate increases from natural gas and electric utilities suggests they could do the same for water companies.
“We’re absolutely optimistic that we have an ICC whose members are thinking about the customers who have to pay these bills,” Scott told Capitol News Illinois.
Profit Rates, Executive Bonuses
Much like they were during the ICC proceedings for natural gas and electricity utilities last year, consumer advocates have been critical of the water utilities’ requested profit rates.
CUB, a nonprofit set up by the General Assembly to advocate for utility customers, is intervening alongside the village of Bolingbrook in the Illinois American case and with the village of University Park in the Aqua case.
Both towns have a history of issues with their respective water utilities. Bolingbrook was among a group of nearby municipalities that sued Illinois American as part of a yearslong battle over control of the pipeline that brings water from Lake Michigan to that area of the suburbs.
University Park faced years of dangerously high lead in its water, leading the Illinois attorney general to sue the company. That case was settled in October 2023.
CUB objects to both companies’ proposed “return on equity,” or profit rate. Currently Illinois American operates with a 9.78 percent profit rate and Aqua operates with a 9.6 percent profit rate. They’ve requested to raise that to 10.75 and 10.8 percent, respectively.
They’ve also requested that the companies be barred from providing bonuses to employees based on meeting financial goals that primarily benefit shareholders.
“Consumers just want clean and affordable water – they shouldn’t have to cover bonuses for Illinois American executives and exorbitant profit rates for corporate shareholders,” CUB Executive Director Sarah Moskowitz said in a statement when the group filed its testimony in the Illinois American case.
When asked about CUB’s criticism of its requested profit rates and executive bonus structure, a representative of Illinois American did not offer any argument to its defense.
“Intervention by customers, communities and third parties like CUB, and the expression of their opinion, is a standard…
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