GUAM UTILITY RATE INCREASES LOOM IN 2007

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By Dionesis Tamondong

HAGATNA, Guam (Pacific Daily News, Jan. 1) – The new year will be a turning point for Ben Rachielug, as he plans to retire this month after 19 years in the Navy.

To ensure his post-retirement plan stays on track, the 42-year-old Mangilao resident said he's keeping on top of the proposed utility rate increases and other financial challenges that 2007 may bring.

The 14.2-percent water rate increase -- for residential customers -- is just one in a series of rate hikes that the Guam Waterworks Authority is proposing, to be able to make federal-court ordered improvements to the island's water system. The 11.8-percent increase to the "recovery fuel charge" portion of customers' power bills is an adjustment that the Guam Power Authority requests about every six months based on the changing cost of fuel.

If the Public Utilities Commission approves those proposed rates, they could take effect early this year.

Rachielug, who was helping with the barbecue at a New Year's Eve gathering yesterday at the Paseo beach park, is the main provider for his household of nine.

He said 2006 was a "productive" year, in that he was able to manage through the utility increases that took effect last year and be able to provide for his family on Guam and help relatives back in his home island of Yap.

But he said 2007 could be a bit more challenging.

With his power bills averaging about $400 per month and his water bills creeping close to $100 monthly, Rachielug said he has started to teach his kids to conserve water and power to alleviate the impact of the likely increases.

The rate hikes and adjustments come at a time when Rachielug plans to look for another job after he leaves his post with the Navy's Mobile Security Squadron 7.

"I'm not too concerned," he said about being able to pay all his bills. "But I wish (the water and power agencies) could find other ways to cut costs instead of sticking it to the ratepayers."

Last February, water rates increased by 4.5 percent to pay for planned infrastructure projects, which include replacing village distribution lines.

PUC officials at the time also agreed to increase by 1.54 percent a surcharge that pays for GWA retirees' supplemental annuities.

Three months later, commissioners approved a 6-percent increase in the fuel recovery charge of customers' power bills.

Residents' pocketbooks have also been hit in other ways this past year: from a hike in federal student loan interest rates to the increases in health insurance rates -- particularly for government of Guam employees.

Those seeking to buy new homes or other real estate will have to plan more to be able to afford such a large investment.

There has been a resurgence in Guam's homebuying market in the past few years, though that stabilized in the past year, industry experts said. But they also noted that the real estate market is expected to grow in anticipation of the military-fueled economic boom.

Even the price of postal stamps next year may go up.

The U.S. Postal Service's governing board is seeking an increase of 3 cents in the first-class rate -- probably to take effect in the spring of 2007.

"This new year -- 2007 -- will be the test, especially coming back to civilian life," Rachielug said. "I have a lot of big decisions to make."

 

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