Owner Grady Kohler renamed the former Wanship Cottages Water Company to simply Wanship Water Company when he took it over in Jan. 2023.
The Windermere Real Estate-Utah principal is now doubling down on a rate increase he secured at the Utah Public Services Commission, which regulates utilities companies, last year.
Rates jumped from $19 per month to about $150.
Eleven residents filed a formal complaint on April 15. Kohler’s attorneys filed a response in May, including new details about why such an increase is needed.
His attorneys cite a 2016 fire in Wanship Cottages, after which the homeowner sued the water company because they said their hydrant didn’t supply water and firefighters had to truck water in.
The lawsuit was settled outside of court in 2022, but Kohler’s lawyers say it demonstrates why the increase is needed.
Kohler acknowledged the rate hike was a “massive increase” at a hearing before the Public Services Commission last November, but argued it was warranted because the water system needed significant repair and safety upgrades.
“Some in the community put it the best way that, if you look back, they probably got a really good deal on water the last 35 years,” he said at the Nov. 1 rate increase hearing. “It just happens to hit them all at once right now.”
No one from the neighborhood protested at the November hearing, after which state regulators approved the 700% increase.
Homeowner Josh Craigle, one of the residents leading the complaint, says that’s because Kohler misled them. That’s why they’re filing a complaint after the fact.
“He led us to believe that showing up at the hearing would be of no consequence,” Craigle told KPCW.
Kohler says he communicated everything adequately and included emails in his response to the complaint.
The 11 Wanship Cottages homeowners filed a second response June 3, reiterating that they agree increases are needed but that they should be more gradual.
State regulators now have three options.
A spokesperson for the Public Services Commission says they may ask for more information, schedule a hearing or deliver a ruling. There is no estimated timeline when that may happen though, the spokesperson said.
The Utah Division of Public Utilities, which helped Kohler arrive at the rate hike, has stayed silent on the complaint docket.
“This case obviously presents challenging issues caused by decades of low rates and low investment,” a division spokesperson told KPCW in a statement. “This is not uncommon with small water companies, and the division encourages companies to seek rate increases as it learns of situations such as this.”
The division is unlikely to weigh in with additional information, according to the statement.
The division’s role is primarily advisory, and it recommends rates that would ensure a safe and reliable water system. The division says the owner is due a “reasonable return on investment” and that companies should accrue capital reserve funds for emergencies.
