Agency Lobbies To Raise Water Rates 45%

The Public Utilities Commission still hasn’t reached a decision on whether Catalina’s water rates will increase or who will pay for the increase.
The commissioners decided to delay a decision on Thursday, July 12, for “further study” and rescheduled the issue for an Aug. 2 meeting. Some commissioners have expressed concern about a proposal that would apply Catalina water rates to Southern California Edison’s mainland customers’ electricity bills.

The Public Utilities Commission still hasn’t reached a decision on whether Catalina’s water rates will increase or who will pay for the increase.
The commissioners decided to delay a decision on Thursday, July 12, for “further study” and rescheduled the issue for an Aug. 2 meeting. Some commissioners have expressed concern about a proposal that would apply Catalina water rates to Southern California Edison’s mainland customers’ electricity bills.

Meanwhile, an attorney representing opponents of the rate increase said another state agency is lobbying in favor of increasing Catalina’s water rates. Norris J. Bishton Jr. said the California Division of Ratepayer Advocates is lobbying the Public Utilities Commission to approve a water rate increase for Catalina Island.

The current proposal would have mainland electricity users pay for Catalina’s water or, alternatively, would have Islanders pay the rate increase over three years.

The Division of Ratepayer Advocates reportedly supports the three-year payment version of the rate increase. The DRA is not a consumer group, but a division of the California Public Utilities Commission.

“Our statutory mission is to obtain the lowest possible rate for service consistent with reliable and safe service levels. In fulfilling this goal, DRA also advocates for customer and environmental protections,” said the DRA website.

According to an administrative law judge who opposed the rate increase, Edison’s current Catalina water rates are the highest in California. According to Bishton, the DRA wants the commission to raise the rates by 45 percent, but wants it to do so over a few years.

According to Bishton, who represents rate increase opponents (also called “protestants”), Joseph P. Como, the acting director of Ratepayer Advocates, sent a letter to the Public Utility commissioners urging them to raise the rates and suggesting that it be done over three years.

Bishton said DRA officials have met privately with Public Utility commissioners and their advisors.

“The DRA should add a phrase to its mission statement – ‘except ratepayers on Catalina Island,’” Bishton said. “SCE has recently been elevated to a Class B water utility because it now has more than 2,000 connections. If the commission follows the DRA recommendation, the highest rates on Catalina Island will be 16 times higher than the average of the highest Class C rates and an incredible 25.7 times higher than the average of the highest Class B rates, excluding Edison. The Protestants are in contact with the legislators representing Catalina Island and are asking them to investigate the DRA’s actions.”

During the hearings before Administrative Law Judge Robert Barnett, the Ratepayer Advocates largely supported Edison’s request to double water rates, recommending a 64 percent increase. Edison sought $15,929,915 for capital improvements such as Pump House No. 2 and the computer control system. The Ratepayer Advocates wanted to give Edison $13,645,700. Judge Barnett granted Edison only $6,590,000, finding many of Edison’s expenditures “unreasonable,” “excessive” and “not justified.”

“Despite the high cost of doing business on Catalina, SCE’s proposed average residential monthly water bill for Catalina customers is comparable to monthly bills for small mainland water utilities.  The proposed rate increase would fund operations and maintenance for SCE to continue to provide safe and reliable water service,” said Ben Harvey, Edison’s region manager for Local Public Affairs.

“The proposed rate increase is tied to significant capital infrastructure upgrades over the past five years — at a cost of about $12 million — including replacement of a critical pump house, a project needed to make a dam earthquake-safe and automated controls to improve safety, reliability and conservation,” Harvey said.

“SCE believes the revised proposed decision is better than the original,” he said. “But it doesn’t provide for cost recovery of all of SCE’s reasonable investments."

Barnett’s ruling also favored applying the cost of Catalina’s water to the electricity bills of Edison’s mainland customers.

“SCE is committed to safely providing reliable water service at affordable rates. The revised proposed decision as written would accomplish that by allowing SCE to recover costs for the necessary system upgrades while transferring the rate increase to electric customers. Another option SCE has proposed is to phase in the increase into water rates over three years,” Harvey said.

Barnett’s ruling was called a Proposed Decision. The Public Utilities Commission can adopt, reject or change a Proposed Decision.

To contact the Division of Ratepayer Advocates, write to Joseph P. Como, Acting Director, Division of Ratepayer Advocates, 505 Van Ness Ave., San Francisco, CA 94102, or e-mail him at joseph.como@cpuc.ca.gov. To contact the Public Utilities Commission, Write the CPUC Public Advisor at 505 Van Ness Ave., Room 2103, San Francisco, CA 94102 or e-mail public.advisor@cpuc.ca.gov.
 

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