Southern Utilities: Water rate hike on table in parts of county

Published on Thursday, 14 November 2013 22:55 - Written by By Kelly Gooch

Southern Utilities Company plans to hike water rates for thousands of customers, but the proposal has drawn opposition.

Southern Utilities, which covers Smith County outside of Tyler, northern Cherokee County and parts of Rusk County, has about 19,000 meters, which equates to about 55,000 to 56,000 people, according to Michael Farrell, vice president and general manager for the company.

Farrell said the company has proposed a rate increase, which would take the monthly base rate on a standard residential meter from $20.62 per month to $25.58 per month.

The gallonage charge, which has been $2.05 per 1,000 gallons for the first 10,000 gallons and $3.20 per 1,000 gallons for everything over 10,000 gallons, would also change, according to the company.

The new proposed gallonage charge is $2 per 1,000 gallons for the first 6,000 gallons, $2.50 per 1,000 gallons for the next 6,000 gallons, and $3.50 per 1,000 gallons for everything over 12,000 gallons.

Farrell said the company also plans to implement a conservation rate of $3 per 1,000 gallons of usage for all usage over 12,000 gallons.

The proposed rates are set to take effect Dec. 1 but wouldn’t be reflected until the Jan. 25 monthly billing statement, he said. Farrell said the proposed rates would be interim rates, pending final approval by the Texas Commission on Environmental Quality and the Public Utility Commission of Texas. He also noted that the proposed rates would not apply to anyone who pays City of Tyler taxes.

Money from the conservation rate is “customer-contributed,” Farrell said, meaning it doesn’t go to the company, but is used for infrastructure improvements “for increased capacity for the customers.”

He said the company spent more than $3 million on various infrastructure projects since the last increase, which became effective in 2009. That included additional elevated and ground storage as well as a new electronic monitoring system for the company’s more than 30 wells.

Southern Utilities “has to implement and get everything working correctly before it can cover the cost … and (this rate) increase is just a rate of return on investment,” Farrell explained.

He said the company is rate cautious but does have to keep up with customer demands.

In the end, he said, customers who don’t overuse water will not see a significant impact on their bill, but the rate increase will be costly for those who overuse.

Customer Jon Sorrells said he is displeased with what Southern Utilities is doing.

Sorrells,68, lives off of Texas Highway 110 near Pleasant Hill Baptist Church.

He said he believes the rate increase is set up to benefit the company.

“They’re making me as a consumer pay for what they didn’t plan for to start with. As a consumer, I don’t think that’s right,” he said.

Therefore, he said, he is trying to get as many people as possible to work with him in protesting the increase through the Texas Commission on Environmental Quality.

He said he wants to schedule a meeting to talk with other customers about the protest process, and possibly find someone who will lead the effort.

Those with questions about the proposed rate increase may call Farrell at 903-566-3511.