Should SJWC ratepayers get a portion of Homeserv USA revenues?

In my continuing research I noticed that DRA/ORA apparently got a ruling that affects certain revenues that Class A & B water utilities receive and apparently must pay a percentage, received from Homeserv USA to their ratepayers. Since San Jose Water Company is a Class A Water Utility, the following questions seem appropriate:

• Does SJWC receive an annual payment from Homeserv USA? for exclusivity?
• Does SJWC also receive an annual percentage of the premiums SJWC ratepayers pay?
• How much are the total annual revenue that SJWC receives from Homeserv USA?
• How will SJWC credit it's ratepayers for the 10% mentioned in the DRA/ORA report?
• How much credit will each ratepayer receive? and when?
• There's apparently a significant amount of revenue involved? How much?
• Will SJWC share this information in an open and transparent fashion?

Keep in mind that this ruling reveals some interesting points that could result in credits from Homeserv USA revenues, as well as other services provided by all Class A & B including San Jose Water Company (SJWC):

"21 In November of 2011, as part of its exclusivity contract with HomeServe, CWS 

22 received the first of seven annual payments (“Annual Payment”) in the amount of 
23 $1,169,000.00 in addition to its standard contracted business activity revenue."

Note: 7 x $1,169,000.00 = $8,183,000.00 plus at least 10% of the premiums - where is the money going? Not only for California Water Services? but what about San Jose Water Company?  

COMPANY-WIDE REPORT, ON THE RESULTS OF OPERATIONS 
OF CALIFORNIA WATER SERVICE COMPANY 
General Rate Case Application 12-07-007

Page 2-3 excerpt
1 1. Overview of New Rules
2 As of July 1, 2011 new rules governing NTP&S went into effect. Rule X in D.10-
3 10-019 (Decision Adopting Standard Rules and Procedures for Class A and B Water and
4 Sewer Utilities Governing Affiliate Transactions and the Use of Regulated Assets for
5 Non-Tariffed Utility Services) and D.11-10-034 (Modified Decision Regarding Petition
6 for Modification of Decision 10-10-019) provides a uniform methodology for tracking
7 and accounting for NTP&S activities (formerly referred to as “Excess Capacity”)
8 provided by Class A and Class B water utilities using regulated resources to generate
9 additional revenues. In addition to providing uniform guidelines for unregulated cost
10 allocation, the Commission in D.10-10-019 also adopted basic rules for revenue sharing
11 with ratepayers which designate NTP&S activity types as being either “active” or
12 “passive.” This distinction between “active” and “passive” activities assigns a gross
revenue sharing rate to ratepayers of 10% to “active” and 30% to “passive” activities.4

Page 2-6-7 excerpt
20 b) Home Service USA Forecast
21 In November of 2011, as part of its exclusivity contract with HomeServe, CWS
22 received the first of seven annual payments (“Annual Payment”) in the amount of
23 $1,169,000.00 in addition to its standard contracted business activity revenue. In
response to DRA’s data request,7 24 CWS stated that it did not share any portion of the 2011
25 Annual Payment from HomeServe with ratepayers and because CWS used 2011 data for
26 test year forecasting, this revenue was excluded from CWS’s forecasted revenue sharing

 Response to Data Request MC8-003 Q2.
2-7
for Test Year 2014. In a subsequent data request response,8 1 CWS further explained that
2 pursuant to the settlement agreement between CWS and DRA in A.08-05-019, CWS was
3 not required to share the 2011 Annual Payment with ratepayers. DRA examined the
4 terms of the settlement agreement, which is currently awaiting Commission approval, and
agrees that CWS need not have shared the Annual Payment in 2011.9 5 However, the
6 pending settlement in A.08-05-019 also states that “[b]eginning with the November 2012
7 annual payment from HomeServe, ratepayers will receive a 10% share of the annual
payment that Cal Water receives from HomeServe.”10 8 For this reason, DRA
9 recommends that this Annual Payment revenue be subject to ratepayer sharing at the rate
10 of 10% for this GRC and has calculated its revenue sharing test year forecasts for each
11 district accordingly. To allocate the $116,900 ratepayer’s share of the Annual Payment
12 amongst CWS’s districts, DRA applied an allocation factor that is in proportion to the
13 HomeServe revenue generated in each CWS district.

If your concerned about the potential  San Jose Water Company not accounting for Homeserv USA revenues and  properly, transparently disclosing what is done with the revenues and what do we ratepayers should receive? Send an eMail as shown below and ask CPUC what do we get, how and when?

If you are concerned about the issues, send email to CPUC at:
District 5 United eForm eMail  Simply click on the "eForm eMail" and you will get a page to fill out the information and specify the reason for your opposition to the SJWC 44% Rate Increase, Homeserv USA water pipe insurance and your opinion of SJWC Customer Service and your concern about lack of openness and transparency, as well as concerned that we are not being informed in a timely manner, of the status of the 44% Rate Increase!

You can also send an email to CPUC Public Advisor public.advisor@cpuc.ca.gov  The Public Advisor will insure your email will be sent to all the appropriate CPUC staff members.

What does Homeserv USA (HEIS) pay SJWC

I noted that during the interview that Tony Kovaleski had with Richard Roth CEO of SJW Corp., as well as San Jose Water Company, SJWCTX, SJWC Land company, etc.), resulted in Mr. Roth saying,"legally we don't have to". The question was the request for transparency and access to information, on a variety of topics that can affect our (the ratepayers) water rates. View the interview "SJ Public Utility Keeps Some Spending Private" and the accompanying article. Did SJWC also receive an exclusivity fee as did CWS?

We encounter more information that other Bay Area water utilities have published, but that the San Jose Water Company failed to publish.

Who is promoting Water Pipe Insurance and what do they get, in the Bay Area?

Water Company	Employee Recommending	Comments/Links	%	Fee	Premium
Contra Costa Water District	Jerry Brown, CCWD,  General Manager	offered Aug. 2011	?	?	$4.95 month
San Jose Water Company	Robert Day, SJWC Director of Customer Service	offered May 2013	YES	?	$4.95 month
Alameda County Water District	Walt Wadlow, ACWD’s General Manager	offered Sept. 2012 ACWD FAQ	10%	?	$4.95 month
Dublin San Ramon Services District	Vicki Goldman, DSRSD, Customer Services Supervisor	offered Jul. 2013 DSRSD FAQ	10%	$25K	$4.95 month
CWS Utility Services (California Water Service Group)	Paul Ekstrom, CWS, Customer Service & Information Systems	Feb. 2011 CWSUS FAQ	YES	$1,169,000 yr, for 7 yrs exclusivity	$4.95 month
Great Oaks Water Company	Tim Guster, Vice President,  Great Oaks Water Company	offered Mar. 2014	?	?	$5.25 month

I found six water utilities in the Bay Area offering water pipe insurance from Homeserv USA (AKA HEIS, Home Emergency Insurance Solutions). Three have published on there web sites that they are being compensated, a percentage (%) of insurance premiums paid by you (ratepayers), to Homeserv USA. In one case Dublin San Ramon Services District disclosed it also received a one time payment for administrative support. In recent research a report from DRA/ORA also showed that CWS CaliforniaWater Services is receiving an exclusivity fee of $1,169,000.00 (per/year for 7 years) in addition to its standard contracted business activity revenue, from insurance premiums.  The table shows the water companies/districts that have not disclosed, indicated by (?), the compensation they are receiving from Homeserv USA.

It's apparent that openness and transparency is lacking on the part of the publicly traded water utilities or privately owned. Although there is a pleasant Vimeo video by Robert (Bob) Day the Director of Customer Services, "Bob Day of San Jose Water Company shares his experience of partnering with HomeServe". He also signed the cover letters many of us have received, from Homeserv USA or Home Emergency Insurance Solutions. Hmmm, I can't find who is paying what to whom and where the money is going? The video is really a very nice commercial, in my opinion, but other than providing rather nebulos statements of how the "fundamental values are shared", by both companies and extensive research was conducted, before recommending Homeserv............ watch the video and draw your own conclusions. It's also hard to understand why San Jose Water Company has only two stars on Yelp and I did notice that Bob makes an effort to monitor the Yelp reviews. I believe this may be a painful experience for any person, involved with SJWC, to read so many bad reviews.

If your concerned about the potential  San Jose Water Company 44% Rate Increase, Homeserv USA water pipe insurance, the 2 star Yelp rating for SJWC and a possible exclusivity fee, send an email as described below to remind our elected officials and CPUC that we are concerned and have not forgotten the issue!

If you are concerned about the issues, send email to CPUC at:
District 5 United eForm eMail  Simply click on the "eForm eMail" and you will get a page to fill out the information and specify the reason for your opposition to the SJWC 44% Rate Increase, Homeserv USA water pipe insurance and your opinion of SJWC Customer Service and your concern about lack of openness and transparency, as well as concerned that we are not being informed in a timely manner, of the status of the 44% Rate Increase!

You can also send an email to CPUC Public Advisor public.advisor@cpuc.ca.gov  The Public Advisor will insure your email will be sent to all the appropriate CPUC staff members.