Verona Water Rate Study 2018

The Verona Water Utility filed an application with the Public Service Commission of Wisconsin (PSCW) to increase water rates in July 2018.  Below is a series of documents related to the rate case such as public hearing notice, draft rates, and anticipated implementation.  Here is a what, why, and when in regards to the rate case.


The water utility is a self-sustaining enterprise fund operated by the Public Works Department and governed by the City of Verona Public Works, Sewer, & Water Committee and ultimately Common Council.  The water utility applied for a rate increase to the Public Service Commission of Wisconsin (PSC-W) – Water Division in July of 2018. 

Enclosed is an estimated rate structure prepared by PSC-W staff that will be presented to the PSC-W Commission for action.


The most recent rate cases implemented by the water utility were as follows:

1.    2016 – simplified rate increase, increases set annual by PSC-W 

2.    2011 – conventional rate increase

3.    2001 – rate increase

4.    1998 – rate increase

Since the last conventional rate increase in 2011 the water utility has experienced the following:

A.    Operating & maintenance expenses have increased 13% (average of 1.6% per year)

B.    Total operating expenses have increased 57% since 2011

C.    Over last eight years the utility has invested over $10 million in infrastructure resulting in

  • 126% increase in rate base
    • Rate base is the value of property on which a public utility is permitted to earn a specified rate of return, in accordance with rules set by a regulatory agency. In general, the rate base consists of the value of property as used by the utility in providing service
  • 136% increase in depreciation of assets 
    • Assets are defined but not limited to water mains piping, valves, and hydrants.
  • 80% increase in tax equivalent payment
    • Tax equivalent payment  is payment made to the City of Verona lieu of property taxes

D.    Revenues have only increased 18% based on customer and usage growth


The PSC- W will ultimately act of the effective date of the rate increase but the utility will have 90 days to implement the rates once the final order is issued from the PSC-W.  The target date Verona Water Utility staff is anticipating having new rates effective is October 1, 2019.

Moving Forward:

The Verona water utility will look to use simplified rate increases to follow inflation and reduce the percentage of the conventional rate increases.