I/M/O the Petition of Roxbury Water Company
for Approval of an Increase in it’s
Rates for Water Services
BPU Docket No. WR03110904

April 12, 2004
Senior Center
Township of Roxbury

Good evening. My name is Susan McClure, and I am an attorney representing the New Jersey Division of the Ratepayer Advocate. Our office was created by the New Jersey Legislature to represent ratepayers in cases such as this where a utility seeks an increase in rates or change in services.

In order to effectively represent the public in utility rate cases, our office uses a team of lawyers, accountants, economists and engineers to analyze requests for rate and service changes filed by companies who provide energy, water, and telecommunications services in New Jersey.

Roxbury Water Company (hereafter referred to as “the Company”) filed a Petition on November 14, 2003 with the New Jersey Board of Public Utilities (“Board”) asking for an increase in water service rates and charges for public fire protection service. The Company’s Petition seeks an overall rate increase of $ 362,175.00 or 27.78% of total revenues.

The Company provides water service to residential and commercial franchise Customers in portions of Roxbury Township. The Company also provides municipal fire protection service in portions of Roxbury Township. The proposed rate increase will increase the fixed rate. Bills will be tendered quarterly and for the average residential and commercial customer using 22,000 gallons per quarter, this would mean an increase of about $20.77 from $74.96 to $95.73 quarterly. Municipal Fire Protection Service billing will increase about $55.50 from $199.80 to $255.30 per quarter.

The Company has not had a rate increase since 2001 and claim this increase is needed in order to eliminate operating losses; to permit the Company to meet increased operating expenses experienced by the Company since its last rate increase; to establish rates which will be sufficient to enable the Company to maintain financial integrity and to enable the Company to provide safe, adequate and proper service to customers.

Under the laws of New Jersey, regulated utilities, such as Roxbury Water Company are permitted to charge rates that are Ajust and reasonable@. The law allows a utility company a fair opportunity to earn a profit on its investment. Our office is conducting a complete investigation of the Company’s request based upon the information that is being supplied and updated by the Company. We have retained the services of an expert consultant to assist us in our review. We will issue numerous questions to the Company, seeking to discover detailed information regarding its financial structure, operation and maintenance expenses, and other financial obligations. The Company must justify all of its expenses and other claims, and provide evidence to support its calculations.

We are in the process of analyzing the data we have received so far from the Company. Our consultants will offer testimony regarding various portions of this proposal to increase your rates. We can state at this time that we have some concerns regarding the requested increase. We are focusing especially on these critical issues:

We expect to question Roxbury Water Company representatives about these concerns and to raise them at any settlement meetings. An evidentiary hearing will be held on May 28, 2004 at the Office of Administrative Law in Newark, NJ, before the Honorable Irene Jones, who is presiding over this public hearing this evening. At the evidentiary hearings we will cross-examine any witnesses that the Company might present, and submit expert testimony in support of our own recommendations. However, it is important that you are aware that the ultimate decision regarding this requested increase will be made by the Board.

The purpose of this hearing is for you, the customer, to voice your opinion, relate your experiences and offer comments about your Company’s rates and service. It is important that you express your views so they may become part of the record on which the Board of Public Utilities makes its decisions. The Ratepayer Advocate also needs to hear your views. Your active participation is strongly encouraged to help in our evaluation of the Company’s proposals and our preparations for the evidentiary hearings.

This hearing is being transcribed and your comments will become part of the record. I would like to reiterate the importance of your participation so that the Ratepayer Advocate can have a clear record of your concerns and interests.
On behalf of the Ratepayer Advocate, thank you for attending tonight’s hearing.