Florida Act Would Regulate Rates At Private Water Utilities

The Florida legislature is considering a measure that would prohibit privately-owned water utilities from charging more than government-owned ones in the same county. 

Introduced by Sen. Wilton Simpson, the Consumer Water Protection Act is aimed at making water rates fairer for ratepayers, who have limited choices.

"Simpson says because customers don’t get to choose which utility they’re zoned for, he wants to help equal out the rates between city-owned utilities and their privately owned counterparts, which serve more than 180,000 Florida customers," WFSU reported. 

The rates vary considerably in different neighborhoods, according to Simpson. 

“I don’t think it’s fair that a person on one side of the road pays $50 for water service and the person on the other side of the road has to pay $100,” he said in the Tampa Tribune.  “This is about providing clean drinking water at a fair price. This is about reducing people’s water bills in half.”

Customers should not have to pay high prices to guarantee a certain amount of profit for the utility, he said.

Simpson also wants customers to get money back for bills they already paid. "He said private water companies — and even those systems owned by the Florida Government Utility Authority — should be required to lower their rates retroactively and refund the difference to their customers within 12 months," the Tribune reported. 

Privately-owned water utilities are lobbying against the proposal. “Comparing investor-owned utilities’ rates to any other municipal rate structure is not an accurate analysis,” said Patrick Flynn to WFSU. Flynn is the Southeast Regional Director for Utilities Inc., which serves more than 60,000 Florida customers.

Private companies have higher costs, he said, including more taxes and fees. Government-owned utilities also "have access to lower-interest rate financing, typically through the municipal bond market," he said.

The legislation also "requires that commission to consider water’s taste, smell and color when deciding whether companies can raise rates," according to WFSU. 

That’s redundant since ratepayers already have a chance to register quality complaints at rate-setting hearings, Flynn said to WFSU. 

The legislation is partially based on a government study published last year. 

The report recommended "the establishment of a statutory mechanism by which

the Public Service Commission (PSG), Florida's water regulator, 

would consider whether a utility meets water standards and wastewater treatment standards established by the Department of Environmental Protection."

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