Nearly 50 people packed into a McCracken County courtroom Wednesday evening to tell the state’s Public Service Commission to reject a proposal from a private water and sewer utility that would see their residential customers’ monthly rates climb to over $100 per month.
Bluegrass Water owns sewer systems serving nearly 2,500 customers across 13 in western and central Kentucky. It also owns the Center Ridge Water System and its four districts in Calloway County.
The utility provider asked the PSC late last year to approve rate increases for its Kentucky customers. In its rate increase application, Bluegrass Water said its current rates do not cover the costs of improving and maintaining the systems it has acquired since it started business in the commonwealth in 2019.
The company is seeking to raise its unified rate residential wastewater customers – which includes several neighborhoods in Marshall and McCracken counties – from $77.77 per month to $111.72. It also wants to raise monthly residential water rates from $77.63 to $106.12.
Since 2019, Bluegrass Water officials say the utility has spent over $18 million on improving its water and wastewater systems and bringing some of them into compliance with health and environmental regulations.
Alex Freeman, who lives in the Arcadia Pines neighborhood in West Paducah, told PSC commissioners the work that has been done on and around the system’s sewer pond doesn’t justify the prices the company wants to charge residents for their services.
“When you're asking families to pay $111 a month for wastewater, you don't get to simply point to a spreadsheet and say ‘trust us,’” Freeman said. “You have to demonstrate that that money is necessary. You have to demonstrate that that system is being properly maintained. You have to demonstrate that the ratepayers are receiving value for what they're being charged, and you have to demonstrate that Arcadia Pines ratepayers aren't being forced to subsidize somebody else's system.”
Several people who gave public comments on Wednesday said they have not found system-specific data from Bluegrass Water on how much the company has spent on improvements.
In McCracken County, the largest wastewater service provider is the Paducah-McCracken Joint Sewer Agency, a nonprofit regional utility. Under rates that went into effect in July, households pay a minimum of $21.72 per month plus $7.24 per every thousand gallons of water usage above 3,000 during that billing period. Bluegrass Water’s proposed unified household monthly sewer rate is over four times higher than JSA’s base rate.
Unlike JSA’s meter-based rates, Bluegrass Water is proposing one unified rate for all residential customers regardless of their monthly water consumption. In a filing with the PSC, Bluegrass Water officials say basing rates on household wastewater usage would require the company to purchase and install meters and perform monthly meter readings – which they say would come with costs that the for-profit utility would need to recover through increased rates.
Robert Evans, who lives in the Marshall Ridge subdivision in West Paducah, said residents on Bluegrass Water systems are “captive customers” because utilities in Kentucky are granted exclusive rights to provide service in certain areas, meaning they don’t have to compete with other businesses for customers. As a private company, Evans said Bluegrass Water’s priority is their shareholders – not the customers the utility serves.
“This is their business model, and this is what they sell the investors to get them to give the money in the first place. They don't give a rat's ass about safe, responsible, reasonable services,” Evans said.
PSC Chair Angie Hatton said the commission could use some of the questions brought up by residents to inform what the state agency will ask Bluegrass Water representatives at a formal hearing later this month.
Another public comment meeting on Bluegrass Water’s rate application will be held in Georgetown on Tuesday. The PSC will hold a formal hearing on Sept. 21.
Hatton said a decision on PSC’s rate increase proposal is due by March 2027 – but could be issued before then.
The full public comment meeting held in McCracken County can be streamed on YouTube. Public comments on Bluegrass Water’s rate increase application can be filed on the Kentucky PSC’s website and will be entered into the case’s official record.
