Portsmouth Water District Votes to Not Raise Rates

customers will not see a water rate or tax rate increase during the next year. 

According to Administrative Board Chairman Philip T. Driscoll, the board voted at its meeting of April 17 to approve its fiscal year budget with no water or tax rate increases. 

The fiscal year began on May 1. The board’s vote affects water used between the spring of 2012 and the spring of 2013. Driscoll indicated that a one-year delay in an expected increase in 2012 for the cost of water from Newport Water factored into this decision.  

The district’s tax rate in fiscal year 2013 will remain unchanged at $0.18 per thousand dollars of assessed property value.  Driscoll noted that the revaluation of property by the town of Portsmouth at the end of calendar year 2010 resulted in decreased assessed property values in the district. 

The board increased its tax rate from $0.15 to $0.18 in fiscal year 2012 to compensate for the drop in assessed values. This change was revenue neutral and raised the same amount of tax revenue as in fiscal year 2011, with the exception of the additional revenue from new properties. 

The fiscal year 2013 budget shows $521,403 in tax revenue, which comprises 16 percent of the total budget. 

Despite the good news about this year’s rates, Driscoll cautioned customers that district water rates are projected to increase by an average of 16.75 percent for three fiscal years starting in FY-2014 based on current information. 

These increases will be needed to off-set significant wholesale water rate increases from the City of Newport, which are necessary to fund the replacement of the Lawton Valley Water Treatment Plant in Portsmouth and an upgrade to the Station One Water Treatment Plant in Newport. Construction is expected to be completed by the end of 2014.  

Driscoll indicated that Newport Water received approval from the Rhode Island Public Utilities Commission for the water rate increases necessary to fund the $85 million water treatment plant improvements, an effort that Portsmouth Water has supported.  

The 2012 annual water bills, which cover water usage from the spring of 2011 to the spring of 2012, were mailed to customers on May 11 with payments due by July 2. 

 The “Overage Charge” on the 2012 water bill reflects a 13.68 percent increase approved by the board in April 2011, in part to offset an expected increase during the year for the water purchased from Newport Water. 

On Dec. 1, 2011, the Public Utilities Commission approved a 22.5 percent rate increase for Newport Water, which was added to the wholesale cost of water sold to the district.