DC WASA Board Chairman Robin B. Martin today announced that the Board of Directors approved a water and sewer rate increase of 7.5 percent at the September 4, 2008 Board meeting. The rate increase is less than the 8.5 percent increase originally proposed by DC WASA management. It goes into effect with the October 2008 water and sewer bill.

Rate increases are primarily needed to cover the cost of capital improvements. DC WASA, like water and sewer utilities in most major U.S. cities, faces escalating costs associated with meeting more stringent federal regulations for environmental protection and also repairing and replacing aging infrastructure.

“The biggest drivers of DC WASA’s rate increases are mandates by the U.S. EPA to reduce and control pollution in the Anacostia and Potomac rivers and the Chesapeake Bay,” said Chairman Martin. DC WASA’s current ten-year, $3.1 billion capital program is slated to improve water and sewer systems, to improve pumping and treatment facilities, to reduce nutrient content in wastewater, and to reduce combined sewer overflows (CSOs) into District waterways. Though other factors also contribute to the pollution in the District’s waterways, such as litter, storm water runoff and nutrient-rich fertilizers, the Authority is working to improve the health of local waterways.

DC WASA’s FY 2009 operating budget expenses, apart from debt service to finance the capital program, and PILOT / ROW (payment in lieu of taxes and right-of-way), have been held to a modest 2.7 percent increase over the FY 2008 revised operating budget and were not a significant factor in the rate increase.

Added Martin, “The issue of aging infrastructure is one that challenges water and sewer utilities throughout the country as water mains, sewer lines, valves and pumps reach or exceed, in most cases, the end of their useful life. Some of the District’s infrastructure is over 100 years old. Balancing the Board’s commitment to gradual and predictable rate increases and the rising costs of capital improvements is our biggest challenge. We weighed customer feedback, our obligation to environmental health and the Authority’s financial plans in coming to this decision.”

The rate increase will take effect with the first billing in October, the beginning of DC WASA’s new fiscal year (FY2009). For the typical residential customer, this will result in an increase of approximately $3.74 per month, based on an average monthly usage of 6,231 gallons of water, or 8.33 Ccf. At the same time, the District’s Right of Way/Payment in Lieu of Taxes (PILOT) fee has increased by about $0.41 per month for residential customers. The PILOT fees are charged by the District of Columbia government to DC WASA, and are passed through as a separate line item on the customer’s bill.

The Board also voted to expeditiously begin the process of expanding the Customer Assistance Program to provide additional relief to low-income customers by expanding the program to not only reduce the water bill but also reduce the sewer charge.

The proposed rate increases were communicated through various media and discussed with residents at a number of public hearings and community meetings since first announced in January 2008.

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About DC WASA

DC WASA is an independent Authority of the District of Columbia government and serves more than 580,000 residents in the District by delivering drinking water and collecting and treating wastewater. DC WASA also serves approximately 1.6 million people in the surrounding counties of Montgomery and Prince George’s in Maryland and Fairfax and Loudoun in Virginia with wastewater treatment services at the Blue Plains Advanced Wastewater Treatment Plant.