James Hunter

Tuesday, July 29, 2014

CPUC may vote on August 14th, SJWC Rate increase!

The earliest the CPUC can rule is 14 August 2014, at the scheduled CPUC Business Meeting. We (ratepayers) won't know until the earliest 4 August if it will be on the agenda. Below is the notification on the CPUC website and the entire proposed decision:
"TO PARTIES OF RECORD IN APPLICATION 12-01-003: This is the proposed decision of Administrative Law Judge Wilson. Until and unless the Commission hears the item and votes to approve it, the proposed decision has no legal effect. This item may be heard, at the earliest, at the Commission’s August 14, 2014 Business Meeting. To confirm when the item will be heard, please see the Business Meeting agenda, which is posted on the Commission’s website 10 days before each Business Meeting."
Parties of record may file comments on the proposed decision as provided in Rule 14.3
of the Commission’s Rules of Practice and Procedure.

The public (ratepayers) can attend the business meeting and speak, as well CPUC may discuss and decide privately, then announce the results and possible changes to the proposed decision. See the procedures at: 

We still have potential issues with the GRC:
  1. The rate increase, of 22%, is more than twice the inflation rate and it's obvious SJWC will use the drought and our conservation to charge more for less water, to protect their profits.This was confirmed in a statement by John Tang, Director of Government Relations at San Jose Water Company, 

    "The company will seek reimbursement for its lost profits, which will require a temporary rate increase, he said. In 2009, similar conservation measures at the end of the last drought cost the company $5.6 million in lost water sales, and it temporarily raised rates by 2.5 percent for one year to recover them." 
    Read the entire article at the website."
  2. SJWC is still using the corporate "cloak of secrecy" provided by being a 100% wholly owned subsidiary of SJW Corp., to prevent ratepayers from seeing what is happening and what they are spending. For example in a recent interview, by KTVU 2,  John Tang and a recent Homeserv USA solicitation was shown, it was stated that over 12,000 SJWC had signed up for the insurance. If so that's $4.95 x 12 = $59.40 annually per customer or $712,800 annual premiums and SJWC probably gets $71,280 at least presently.
  3. SJWC is continuing to try to de-couple water sales (revenues) from the cost of operations, the proposed decision denies the de-coupling. In a previous post to this blog I quoted:

    "Furthermore, the results of these programs, including the advantages and disadvantages to water utilities and their customers, has not been fully analyzed, so that the Commission can determine which sales risk mechanism best serves the interests of utilities and their customers. As the current dry years persist, and the need for conservation of water resources continues, the Commission will consider in SJWC’s next GRC, if not before, whether SJWC’s current Monterey-Style WRAM is a useful water conservation mechanism that balances the risks of lost or increasing sales between the utility and its customers."

    I concluded that we are in a holding pattern and CPUC could decide to allow SJWC to use a, full WRAM (Water Revenue Adjustment Mechanism), to guarantee it's revenues and profits, in spite of potentially inefficient operations, fixed costs not being controlled, over building the infrastructure (filtering plants, pipelines, wells. reservoirs, etc.) all are part of the base rate that determines, "How much we pay and the more we pay for our water!". (I need to do a post showing how SJWC profit is determined--that's really a visit to OZ, in my opinion.)
We the Ratepayers have 30 (less than) 16 days to let CPUC, Public Officials and the Press/TV aware of our concerns.  As well both SJWC and ORA/DRA.

Please send email, as noted in the closing paragraphs,
time is running out, to make your opinion heard!

 If you are concerned about these 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 Rate Increase, the continuing refusal to disclose what SJWC gets for supporting Homeserv USA and continuing requests to de-couple their revenue from the requirement to do business efficiently and your concern about their lack of openness and transparency. 

A comment to readers, I'm in favor of water conservation, my concern is the potential misuse and profiting of any water utility from the drought. California goes through periodic droughts and our state wide water system is inadequate for our population. We have a 6 Billion dollar proposed state bill to build infrastructure more dams and reservoirs, hopefully, and we should look hard at items that won't store or directly save water. Lets make sure the bill spends our tax money wisely, we can be sure there will be another drought and being prepared should be our goal!

I'm also opposed to effectively a monopoly utility having ratepayers guaranteeing their profits, in spite of other conditions and especially the "cloak of secrecy" SJWC invokes. In the spirit of disclosure, I am a shareholder in SJW Corp., I've owned ten (10) shares for over a year.

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

Other people to drop an email (note) and express your opinion are:
  • Scott Herhold, San Jose Mercury News, sherhold@mercurynews.com
  • Julie Putnam, NBC Channel 5, julie.putnam@nbcuni.com

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