W.Va. American Water ordered to remain in projects

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CHARLESTON, W.Va. (AP) — State regulators on Monday ordered West Virginia American Water Company to continue participating in a series of water extension projects, rejecting the company's argument that it was not legally obligated to do so.

The ruling by the Public Service Commission came on a complaint filed by five public service districts and several other local agencies. The complaint alleged that in 2011, West Virginia American Water improperly withdrew from partnerships with them to extend water service to new customers in various areas of the state.

About 1,500 new customers would be served by the projects.

The PSC said the water company has an obligation to continue participating in existing and proposed projects to new customers in areas that the company could reasonably serve. The projects must be technically feasible and the company must have a reasonable opportunity to earn a return on its investment.

Monday's ruling does not prevent the water company and any local entities from negotiating alternative extension agreements, the PSC said.

"The subject matter of today's PSC ruling is of great importance to West Virginia American Water and our customers, and we are reviewing the order at this time," West Virginia American Water spokeswoman Laura Jordan said in an email.

The company had asked the PSC to dismiss the complaint, saying it did not violate any obligations to the local entities.

It also argued that it does not have a legal obligation regarding future extension projects, either to the local entities or to customers served by the systems that it leased from or manages and operates for the agencies. The company said these customers are not its customers.

The PSC said evidence shows that the parties have treated these people as American Water customers and the areas served by these facilities as the company's service territory.

In their complaint, the local agencies also raised concerns that the company's staff reductions in 2011 would affect maintenance of their water systems. The PSC ordered the company to continue collecting service quality-related information, which was ordered in 2011 in a separate case, through 2015 and provide the data to the agencies.

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