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Kentucky American Water withdraws rate increase notice, says it will refile request soon

Kentucky American Water has withdrawn its notice to file for a water rate increase with state regulators.

A Kentucky American Water spokeswoman said Friday that the water company intends to ask the state Public Service Commission for a water rate increase but had to delay its filing.

“We are still going to file and will give proper notice, but I don’t have a new date,” said Susan Lancho, director of external communications for Kentucky American Water.

We are still going to file and will give proper notice, but I don’t have a new date.

Susan Lancho, director of external communications for Kentucky American Water

Kentucky American, which serves Lexington, had filed a notice in late October with the PSC that it would file its application for a rate increase by Dec. 1. But on Wednesday, lawyers for the water company filed paperwork with state regulators saying it was going to withdraw its notice. The paperwork doesn’t say why the company has sought to delay its rate increase.

The PSC regulates utilities and sets rates for water, gas, electric and other utilities.

Kentucky American Water last proposed a rate increase in December 2012. Its original proposal was to increase its annual revenue by $12.32 million.

The PSC granted roughly half that increase in October 2013. The utility’s annual revenue increase was roughly $6.9 million.

Lexington and Kentucky American Water recently worked out a new franchise agreement. That agreement would give Kentucky American Water a five-year franchise with the possibility of two five-year extensions. The current franchise agreement — which expired in April — is for 20 years. The city is advertising for bids for its water franchise agreement. It has not yet approved the agreement.

Kentucky American is building a new water infiltration plant off Richmond Road. Typically, utilities file for rate increases after major capital improvements.

Beth Musgrave: 859-231-3205, @HLCityhall

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