GWA rate petition to be heard next week, GSWA rate case a few months out
The Public Utilities Commission will hear the rate petition for the Guam Waterworks Authority at a special meeting on Tuesday, while the rate petition from the Guam Solid Waste Authority likely will not be heard for at least a few more months, as it remains under consideration, according to PUC Chief Administrative Law Judge Fred Horecky.
GWA submitted its latest five-year financial plan and capital improvement program to the Public Utilities Commission in June, where it went through an extensive review process by PUC consultant Georgetown Consulting Group, Horecky stated.
The rate plan initially called for a cumulative projected increase of 71.5% over five years, but local lawmakers subsequently passed legislation creating a tax-exempt commercial paper program for GWA. This is a type of short-term financing method that allows GWA to reduce projected rate increases which are largely meant to support financing for capital improvement projects so the utility can comply with various federal and court-ordered requirements.
In either case, the most significant rate hike would happen in fiscal year 2025, with either jump being more than 20%, although the rate hike with commercial paper would be lower than without it.
However, the utility's initial modeling didn't include an increase in the cost of purchasing water from the U.S. Navy, which GWA uses in its operations.
GWA General Manager Miguel Bordallo stated in August that for fiscal 2025, the projected increase in the dollar amount over projected revenues in GWA's initial filing is $7.075 million.
"If you apply it in that year, and you get that revenue in subsequent years from that raise, and you're holding it constant, there is no further impact in the subsequent years," Bordallo said at the time.
GWA was scheduled to meet with the Navy earlier this week, with discussions anticipated to include future pricing and a potential credit. Bordallo said additional information may be available to share with the Consolidated Commission on Utilities, GWA's governing board, at a meeting scheduled for Wednesday.
Although the PUC special meeting will take place the day before, CCU Chair Joey Duenas said this week that a decision may not be made that day, and the PUC also has a regular meeting on Thursday.
GSWA rates
GSWA's rate projections also included alternate modeling with reduced rates that depended on the passage of certain legislation. In the waste authority's case, that measure was a trash collection service subscription mandate. Although it passed the Guam Legislature in late April, the bill was later vetoed by the governor, who said she was concerned about a lack of assistance for poorer residents.
Had the subscription mandate become law, expanding GSWA's customer base in the process, the waste authority proposed a decrease from existing rates. The residential rate would drop down to $27 per month in fiscal 2025 from the current $30. There also would have been a residential discount rate of $15 per month for eligible customers. The normal monthly residential rate was proposed to go up by $1 by fiscal 2027 - still below the current rate - while the discounted rate was proposed to rise by 50 cents. Afterward, there were no proposed rate increases up through fiscal 2029.
The scenario without the subscription mandate proposed rate increases, but GSWA's revised projections aren't as high as that initial proposal.
The first rate increase, proposed to take effect in January 2025, would increase the monthly residential rate by $3 instead of $5, up to $33 per month. The residential rate is proposed to go up to $35 per month by fiscal 2026, stay at that price for fiscal 2027, then go up to $38 per month by fiscal 2028 and stay there for fiscal 2029 as well.
GSWA General Manager Irvin Slike said Thursday that it appears the agency is on track to have new rates take effect by January of next year. Waste authority officials are anticipated to meet with the PUC's rate consultant for the GSWA petition in early October, according to Slike.
