Indiana Utility Regulatory Commission Withdraw Information- Advantages & Disadvantages
The Board of Directors of Southern Monroe Water is proposing leaving the jurisdiction of the Indiana Utility Regulatory Commission. To do so the board must obtain the approval of its members. Listed below are the advantages and disadvantages of withdrawal. If the board decides to move forward with the withdrawal process all members will be notified of the meeting time and date.
To access the direct link to the Indiana Office Of Utility Consumer Counselor (information about advantages and disadvantages) please click the link below.
www.in.gov/oucc/about-your-rates/utility-withdrawal-from-iurc-jurisdiction/
Advantages of withdrawing from the IURC:
Local control-we have an aging water system and need to make updates and improvements. The decisions concerning the water company will be made by the board of directors and members. The members will have control, not a group of bureaucrats in Indianapolis that do not know the needs of the water system.
Cost savings-A big part of the reason for leaving the IURC jurisdiction is cost savings in key areas and the ability to adjust rates and charges to fit our water system. The IURC charges the water company over three thousand dollars per year fee for being involved with the IURC. This alone is not a reason to leave, however, being able to adjust rates and changes to fit our water system will save the company in the long run by not having to borrow money to maintain our water system. The savings will be put back into the water system instead of being paid out to Attorneys, consultants and regulators.
Flexibility and time savings-It takes several months to get a petition approved through the IURC. Often a utility will be approved for financing or grants and will then have trouble getting IURC approval in time to keep from losing the financing or grant. Improvement projects are less costly when they can be done in a reasonable amount of time.
Eliminate filing of Annual Report-Regulated utilities must file an extensive annual report to the IURC. It seems little use is made of these reports. The information is put into a state date base, that is used to regulate or compare utilities, but with approximately half of the utilities no longer filing reports, the information only reflects those regulated by the IURC.
Disadvantages of withdrawing from the IURC:
The IURC and OUCC have experienced experts that sometimes propose less expensive or better alternatives that will result in lower rates and better service. (This has never been the case for Southern Monroe Water.)
Customers challenging the legality of an action by a utility or its governing board must take action in a local court and bear the burden of proof to show a violation of the law. This is likely to include the need to hire a private attorney. (We know of no action like this ever taken against Southern Monroe Water)
The water company cannot issue tax-exempt bond through the Indiana Bond Bank. This is not a serious disadvantage since the Indiana Bond Bank is often a last resort of financing and hasn’t been used by Southern Monroe Water.
As the cost of regulation is sometimes exaggerated, a utility may not realize promised savings as a result of withdrawing. Proper utility rates and operation will still require much of the same work and cost otherwise involved with the IURC proceedings.
Customers of a municipal utility who live outside the city or town limits are unable to vote in municipal elections. This is not the case for Southern Monroe Water members, they are able to vote in the company elections held each year.
To view the list of other water utilities that have opted out of the IURC please see the files listed below
| withdrawn_municipal_water_utlities.pdf |
| withdrawn_not_for_profit_and_investor_owned_water_utilies |