The Pikeville City Commission voted Monday to institute an increase the rate Mountain District pays the city for its water.
However, the increase, unanimously approved by the commission to go into effect Aug. 1, will only be instituted if the Kentucky Public Service Commission allows the city to institute the rate.
Pikeville City Attorney Rusty Davis told the commission during Monday’s regular meeting that, despite the passage, the only other way a change could go into
effect is if an agreement is reached between the city and Mountain Water in negotiations.
Pikeville’s current monthly wholesale water rates to Mountain Water consist of a minimum charge of $47,040 for the first 28 million gallons and a charge of $1.30 per 1,000 gallons for all usage over 28 million gallons. Pikeville’s proposal, the filing shows, increases the monthly minimum charge by $17,360, or 36.9 percent, to $64,400 and increases the charge for usage over 28 million gallons by $1, or 76.9 percent, to $2.30 per 1,000 gallons.
In March, after the increase was announced, Mountain Water District attorneys Danny Stratton and John N. Hughes filed a letter of protest asking that the PSC use its authority to review the rate for reasonableness and provided an opportunity for a hearing on the proposed change.
“Mountain Water District protests the requested wholesale rate increase and requests that the commission initiate a formal proceeding to investigate the reasonableness of the proposed rate, establish a procedural schedule that allows for discovery and issue any orders necessary to ensure that the proposed rate is not placed into effect or otherwise assessed before the matter is investigated and a hearing held,” the attorneys wrote.
According to data from the Kentucky Infrastructure Authority, the district currently purchases 421 million gallons from the city annually at a cost of $1.68 per 1,000 gallons.
According to the KIA data, Mountain Water currently sells approximately 49 million gallons of water annually to the Elkhorn City Water Department at a rate of $2.25 per 1,000 gallons, with the district also selling water on an emergency basis to Martin County at a rate of $2.40 per 1,000 gallons.
The case currently remains before the PSC.