Voters will decide who sets water and sewer rates

Who should set the city's water rate? Voters will get the final say after City Council approved legislation Thursday sponsored by Council President Darrell Clarke to include a referendum on November's ballot on whether the city should establish an independent body to regulate charges for water and sewer services.

The bill passed 16-1, with Republican Councilman Dennis O'Brien voting against it. Mayoral spokesman Mark McDonald said Mayor Nutter will likely sign it.

Currently, a rate request must go through a public-hearing process and the Council president, the mayor and City Controller select a hearing officer and public advocate. The final decision is made by the Water Commissioner.

"I saw no level of transparency that I was comfortable with," Clarke said. "The notion that the Commissioner gets to approve a rate he puts out … I never understood why we did it that way."

Clarke has said that Philly is the only large city that doesn't allow elected officials or boards selected by elected officials to approve the rates.

The Pennsylvania Public Utility Commission sets rates for the Philadelphia Gas Works and its then reviewed by the Independent Regulatory Review Commission, House consumer affairs committee, Senate consumer protection and professional licensure committee, attorney general's office and the governors budget office.

In February the Water Department announced plans to seek a 28.5 percent rate increase, that if approved would begin in October and be spread over three years. The average customer would see an annual $196 increase over today's rate. The Water Department has said the increase is necessary to deal with a projected $316 million budget shortfall over the next four fiscal years. Clarke's proposal wouldn't impact the current rate.

Several business owners testified last month at a Council hearing that rate increases coupled with increasing storm water fees will force businesses out of the city. Clarke said he would revisit issues regarding storm water.

Contact Jan Ransom at 215-854-5218 or Ransomj@phillynews.com, or follow on Twitter @Jan_Ransom. Read her blog, "PhillyClout" at www.phillyclout.com.