Monarch Utilities Reaches Agreement On Rates With Customers

AUSTIN, Texas, May 16, 2012 /PRNewswire/ -- Monarch Utilities, a subsidiary of SouthWest Water Company, today announced that it has reached an agreement with a number of its stakeholders, the Executive Director of the Texas Commission on Environmental Quality, and the Office of Public Interest Counsel on the water and sewer rate increase originally filed in May 2011.

The stakeholder group, which includes the Coalition of Cities, made up of Blue Mound, Buda, Ivanhoe, and Kyle; TAMER; Denton Creek Estates and Monarch, has agreed to a water revenue increase of 8.7 percent, effective June 1, 2012, and an increase of 4.2 percent, effective January 1, 2013. The new rate structure is tiered to encourage conservation.

Additionally, there will be no sewer revenue increase for the company. Customers will pay for wastewater services based on a monthly minimum charge and their average water usage during December, January, and February beginning on June 1, 2012.

The agreement stipulates Monarch customers will not pay for another water or sewer rate increase before January 1, 2014. By law, Monarch is entitled to recover the company's rate case expenses from customers, but the company agreed to forego these charges.

"Over the past months, we have listened to our customers' concerns about the rate increase and the economic impact on them," Charles Profilet, Vice President, SouthWest Water Company, said. "We are pleased to reach an agreement that meets customers' needs while allowing the company to continue to provide the highest quality water and wastewater services."

With this agreement, Monarch will reduce its requested water revenue by $7.1 million per year and sewer revenue by $1.9 million per year. In the past five years, Monarch and SWWC Utilities have invested nearly $70 million to tap new water sources and replace aging water and wastewater treatment plants.

"These environmentally responsible upgrades allow us to provide our customers with clean, abundant water and to protect our streams and waterways," Profilet said. "The initial rate increase was proposed because our sizeable investment across the state means our costs are significantly higher."

Monarch serves approximately 23,700 customers connections in 24 counties throughout Texas, including Bandera, Brazoria, Chambers, Denton, Grayson, Hays, Henderson, Hood, Johnson, Liberty, Marion, Matagorda, Medina, Montgomery, Parker, Polk, San Jacinto, Smith, Tarrant, Trinity, Tyler, Van Zandt, Wise and Wood.

This agreement and rate change do not apply to customers served by SWWC Utilities, Inc., doing business as Diamond Water Company; Hornsby Bend Utility Company; Huntington Utility Company; Mid-Tex Utilities, Inc.; SW Utility Company; Water Services, Inc.; and Windermere Utility Company, Inc. Per an agreement with the Pflugerville City Council in April 2012, Windermere customers will not see a rate increase for at least one year.

In February 2011, Monarch filed a Sale Transfer Merger (STM) application to consolidate seven utilities into Monarch. Then, in May 2011, Monarch filed for a water rate increase of 62.3 percent and a sewer rate increase of 33.6 percent for the consolidated utilities. State Office of Administrative Hearings (SOAH) judges halted those proceedings in November 2011, and interim rates were set at the rates prior to the increase.

Monarch filed motions with (SOAH) on April 16, 2012 to withdraw the STM application and to request to amend the rate application such that the company would apply for a 14.3 percent water revenue increase and no sewer revenue increase for the legacy Monarch Utilities customers. The agreement provides for less of an increase in water revenues than requested in the amended application.

About SouthWest Water Company
SouthWest Water Company provides a broad range of operations, maintenance and management services, including water production, treatment and distribution; wastewater collection and treatment; customer service; and utility infrastructure construction management. The company owns regulated water and wastewater utilities, and also serves cities, utility districts and private companies under contract. More than a million people in five states depend on SouthWest Water for high-quality, reliable service. Additional information may be found on the company's website: www.swwc.com.

Media Contacts:
Kristin Marcum and Elizabeth Christian
Elizabeth Christian & Associates Public Relations
(For SouthWest Water Company/Monarch Utilities)
512.472.9599
[email protected]

SOURCE SouthWest Water Company