SJWC $8.08 Million Tax Windfall. or "We got it and don't want to share it with those nasty ratepayers!"

To be fair they didn't specifically say "nasty" ratepayers. It's obvious that SJWC feels they've found a legal loophole that will allow them to keep the $8 million and not credit the ratepayers, any of the windfall tax refund and by the way pay SJWC Management  a bonus, paid for by ratepayers, for increasing the value of their shareholder investment. (Please note, I own 10 shares of SJW stock, so I can attend annual meetings.)

 The link below (finally up after being down about 3 days) is again available:

http://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M162/K358/162358073.PDF

My personal view is this is not a case of retroactive rate-making, this is a simple case of greed. SJWC is protected by lots of rules that guarantee them both a profit and a return on shareholder investments. The "system" is and has been very generous, due to previous years of CPUC tendencies to be supportive of all utilities they are supposed to regulate. There seems to be a failing on the part of SJWC and CPUC (Water Division), in this case. SJWC is proactive in requesting action in a timely manner when their "profits" are endangered, but the $8 million tax windfall was apparently not brought to the attention of CPUC, nor did CPUC raise the issue with SJWC, instead SJWC felt that nothing should be paid back to the ratepayers! If in fact the tax action occurred before the next three rate case cycle. SJWC has roughly 225,000 ratepayers, if a simple distribution was 8 million / 225 K = ~$36 credit per ratepayer, a fair pro rata distribution should be based on actual water usage per ratepayer and no credit to WRAP participants who get rates subsidized by full charge ratepayers.

Another point is the SJWC staffing we are already paying for highly paid executives whose objective and mission is to maximize the water rates we pay, this is somewhat obscured by the NTP&S (Non Tariffed Product & Services) for profit business that should be separated from the tariffed (regulated) portion of SJWC business, really hard to do if the folks are part of the SJWC employees our water bills pay for. SJWC requested 33 new staff positions, in the Proposed Decision (PD) 6 positions are recommended.

It's interesting some the other SJWC issues like WRAM that would establish a Water Rate Adjustment Mechanism, to guarantee their profit, independent of how efficient the SJWC is operated. The goal of SJWC is obviously to have ratepayers bear the burden of their potential inefficiency and as much risk and financial burdens, as possible.

While SJWC is at it let's get the ratepayers to pay our Executive and Managers Bonuses! Who does SJWC actually work for? Surprise the shareholders in theory own the company and the management operates to increase the value of the stock and increase the dividends paid to "surprise" shareholders.

CPUC and especially ORA (Office of Ratepayer Advocates) both should work to insure, in the case of SJWC, safe, reliable water service at a fair and reasonable cost to ratepayers. Sometimes the actual mission can be lost in the rhetoric and previously the suspected close relationships, between utilities and regulators.

San Jose Water Company (SJWC) had a meeting regards the PD (Proposed Decision, GRC A-1501002)

I was not really surprised that SJWC had a meeting with CPUC staff, I was pleasantly surprised that the meeting was published in the CPUC website Proceedings. Except today CPUC seems to be having computer problems, it appears their document database has failed. The list of documents, but not the actual documents are available. It seems this happened on this weekend, as I accessed and read the ORA and SJWC documents on Thursday/Friday. I certainly hope this is a computer failure, otherwise it would be a obvious failure to be open and transparent. Raises an interesting question for CPUC to answer, "Did your document database have a failure?".

SJWC sent to CPUC and had published a Notice of an Ex Parte communication. Palle Jensen (SJWC Sr. VP, Regulatory Affairs) pleaded the SJWC case in opposition of several points in the PD (Proposed Decision).

Click here to view original.

May 20, 2016

NOTICE

San Jose Water Company

SUMMARY: On May 17, 2016, Palle Jensen, Senior Vice President of Regulatory Affairs for San Jose Water Company (SJWC), met with Lester Wong, advisor to Cmmr. Randolph, in San Francisco. Also present was Martin Mattes of Nossaman LLP, attorneys for SJWC. Jensen referred to the Proposed Decision (PD) of Administrative Law Judge Tsen, and addressed the PD’s rejection of SJWC’s request for authorization to implement a revenue-decoupling Water Revenue Adjustment Mechanism (WRAM) and Modified Cost Balancing Account (MCBA). Jensen and Mattes explained that the Monterey-style WRAM is a rate adjustment mechanism but not a revenue adjustment mechanism and that it provides no protection against revenue loss due to sales lower than the forecast level on which rates were based. Jensen addressed the PD’s disallowance of certain elements of SJWC’s estimate of test year payroll expense. Jensen and Mattes briefly referred to the PD’s rejection of SJWC’s proposal for a Health Care Cost Balancing Account, and noted the continuing volatility of health insurance costs and the inability of SJWC to control those costs. Jensen noted the objections of the Office of Ratepayer Advocates (ORA) to the PD’s rejection of ORA’s proposal to require SJWC to create a memorandum account to record certain income tax benefits in past years under recently promulgated Internal Revenue Service regulations. Jensen explained that ORA’s proposal would entail unlawful retroactive ratemaking.

A close review shows SJWC opposes, the same disputed issues that they have for the past year:

• WRAM decouple revenues and profits, a "guaranteeing" SJWC profits, A great deal for SJWC, not a good deal for ratepayers. I seem to miss the point of improving productivity and efficiency, providing clean, reliable water to ratepayers at competitive rate Oops! that's right they don't have a competitor!
•  The following sounds much better than executive and manager bonuses, paid by the ratepayers, buried in the water rate: " disallowance of certain elements of SJWC’s estimate of test year payroll expense" . Bonuses seem to me to be an incentive for above average performance and the question becomes who benefits? Seems the executives and managers should be compensated in stock and salary by the shareholders who benefit from most of the efforts. An example is the Sr. VP of Regulatory Affairs what is his bonus and salary paying him to do? Lower your rates or increase SJWC profits?
• Then we have the " income tax benefits in past years under recently promulgated Internal Revenue Service regulations" any other way you say it, this is the 8 million dollar windfall. This creates an interesting situation: (1) where did the 8 million dollars come from? Obviously from the ratepayers, (2) sounds like we were overcharged, but who should have reported the windfall?, (3) we already water flows down hill and water rates go up-obvious over simplification, (4) several questions should be asked, if the State and Federal tax authorities give back money why can't SJWC? The next question does SJWC have a better statue of limitations than criminals? They note: "ORA’s proposal would entail unlawful retroactive ratemaking." SJWC seems to be getting a three year or less period during which if they can hide it they seem to think they should be able to keep it?

We seem to have created through the lack of CPUC action in past 30 years, to establish a simple concept that is pervasive, in the water companies (publicly owned-stock) that CPUC' charter is to insure safe, reliable water service at the lowest rate for the ratepayers and to regulate the effective monopolies that the water companies are in reality are operated in a reasonably efficient manner in the best interest of the ratepayers. . 

After many delays SJWC GRC 2016 (General Rate Case ) will go to the CPUC Commission and with several disputed items that San Jose Water Company has not been able to find a compromise with the ORA (Office of Ratepayer Advocates). Below are the list of disagreements 10 months ago, click for the entire attachment.

• Executive and Management bonuses. I have a problem with the SJWC position they represent the interests of their shareholders, not the financial interests of their ratepayers. Why should the ratepayers of SJWC reward the performance of the executives and managers who are in the final analysis represent the financial interests of the stockowners in SJW Corp. Keep in mind SJWC has a Senior VP and a staff to "optimize" the corporation revenues (you may read as "raise our rates" if you choose). (Please note:  I own 10 shares of SJW stock mainly to allow me to attend the annual meetings.)
  
  ORA and the ALJ Tzen Proposed Settlement both appear to have taken positions opposing ratepayers paying for bonuses. Now we see what the Commission approves?
  
• WRAM (Water Rate Adjustment Mechanism) basically separates the profits from the SJWC performance.
  
  ORA and the ALJ Tzen Proposed Settlement both oppose the requirement for providing SJWC with a WRAM.
  
• There's a complex argument going on about the "windfall" of about $8 million dollars that SJWC has gotten as a result changes to the tax laws. The question that SJWC hasn't been willing to compromise on is "who gets the windfall"? Does SJWC get the windfall or does it credited to the ratepayers who actually paid the money originally? SJWC argues that the money should be kept by the corporation, since no one caught the effects on their taxes, or at least said nothing till the "Statue of Limitations was passed-went into the next Rate Case",  and it would be retroactive to before the current General Rate Case........... It appears to me that we paid the money and at a minimum ratepayers should get credits offsetting some of the current drought and other adjustments being applied to our bills from SJWC. It's not very fair to ratepayers to guarantee SJWC profits and also have them take the "tax windfalls" which we actually paid for. This is "not" a crime just an oversight and potentially untimely disclosure, that conveniently is to the detriment of the ratepayer.
  
  The $8 million spread across 250,000 ratepayers bills means that the projected increase over the next year could be reduced from $7.00/month to about $4.50/month. Note: SJWC got to use the money for several years, but let's not be picky about 10% or less............
  
  There is at least hope that moving forward from 2016 the Commission will approve that SJWC and other utilities have the requirement to make losses know to CPUC (they've been very good at this part) and as well SJWC and utilities make "windfall gains" known to CPUC, to allow the ratepayers interests to be protected.
  
  For readers who need bedtime reading, click for the ORA arguments.
• NTP&S (Non-Tariffed Products & Services) this covers the use of SJWC labor hours on things like cell tower rental space and my favorite the Home Emergency Insurance Solutions (aka HEIS) coverage for the water pipe between the SJWC water meter and the external connection to your house. The terms still have been disclosed by SJWC, but it's safe to assume SJWC gets a 10% cut of the monthly premium.
  
  ORA and SJWC apparently reached a non-precedent setting agreement, on the amount of dollar$ during the current rate case. SJWC did a terminator, "ve'll be bachk!". Since there's money involved I'm sure they will raise the issues again.
  
• SJWC requested increase in staffing by roughly 33 positions during the current GRC (2016, 17 18)
  
  ORA opposed the number and it appears the ALJ Tzen shares concerns, the proposal is 6 positions including the three previously added by SJWC.

There are other issues, but these seem to me to be more significant and controversial, at least they were opposed by SJWC. I'll update this when the Commission rules on the GRC A1501002 and we can see if the "Ghost of the Past President lurks in the CPUC chambers".

Please send email,

 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 currently contested issues 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. 

Please consider pasting the following, or parts you agree with, when you fill in the eForm or send an email to the CPUC Public Advisor:

"I am concerned about the General Rate Case A1501002 that SJW Corp./SJWC has submitted to CPUC, for approval. I'm concerned about the potential effect this may have on increased future water rates and the continuing practice making access to information by ratepayers difficult. I don't approve ratepayers rates paying bonuses to SJWC Executives who have obligations to the shareholders that approve their pay, which may represent a clear conflict of interest. I also oppose providing a WRAM and separating revenues from expenses and guaranteeing SJWC profits. Reducing SJWC motivation to control expenses."

CPUC Public Advisor public.advisor@cpuc.ca.gov  Reference San Jose Water Company (SJWC) A1508016.The Public Adviser will insure your email will be sent to all the appropriate CPUC staff members and commissioners. 

Other people to drop an email (note) and express your opinion are:

• Scott Herhold, San Jose Mercury News, sherhold@mercurynews.com
• Paul Rodgers, San Jose Mercury News, progers@mercurynews.com
• Julie Putnam, NBC Channel 5, julie.putnam@nbcuni.com

SJWC is requesting $150,000,000 yes SJWC that's $150 million dollars, reference A1508016

A1508016 ACTIVE

August 21, 2015

San Jose Water Company

Application of SAN JOSE WATER COMPANY (U168W), a California corporation, for an order to authorize the issuance and sale of additional debt and equity securities not exceeding the aggregate amount of $150,000,000 and other related requests.

ALJ: Adeniyi A. Ayoade (Assigned Aug 28, 2015) COMMISSIONER: Catherine J.K. Sandoval (Assigned Aug 28, 2015)

San Jose Water Company has certainly “quietly” handled this request to CPUC to raise $150,000,000 for a variety purposes. The SJWC Application is available online from CPUC. In particular it was requested that Public Notice is not necessary, see page 11. Again parts of the application were served to CPUC, but were not published. We continue to see SJWC apparently try to obscure information from the ratepayers or make it difficult to obtain, in my opinion. It should also be noted that the $150.000.000 would pass through apparently, SJW Corp., since SJWC supposedly the recipient of the funding, it raises the concern about the use of the funds for purposes other than SJWC. Note, the comment quoted below "use of proceeds for acquisition of existing water systems"? SJW Corp. using proceeds to buy another water system in California or Texas? I generally get concerned when there's an apparent limited visibility into operations that may affect the use of funds and potentially result in rates being increased, in the future.

This appears to say that there will be no rate increases, oops! Reading carefully it says this doesn’t propose a rate increase, so no notice to customers is required. It seems difficult that spending $150,000,000 will not have an effect on rates, either in the ROE 9.99% calculation or in “guaranteed” 8.08% profit. . . . . It does say that, "above those authorized by prior Commission decisions". Sounds to me that it's a two step strategy, (1) get CPUC approval or have a Full WRAM and the second step is to RAISE RATES! I'd appreciate readers comments on this understanding, of the application verbiage.

The schedule proposed by the applicant, SJWC, is quite aggressive. Presently nothing has been posted on the CPUC website since October 5, 2015 when the ALJ requested a reply within 15 days, oops! that was 10/20/2015 and there has not been a response from SJWC. That's 34 days late apparently, unless this was a confidential response.

I really appreciate that we the ratepayers may be funding the acquisition, of another water company or as the application says "acquisition of existing water systems", with some part of the $150,000,000. Who is the existing water system? Great Oaks Water Company or the remaining part of the City of San Jose  water system?

The ALJ has requested clarification of certain financial estimates in the Ruling dated 10/05/2015, “ADMINISTRATIVE LAW JUDGE’S RULING DIRECTING APPLICANT TO FILE A RESPONSE TO INFORMATION REQUEST WITHIN 15 DAYS”.

So, we find ourselves as ratepayers looking forward to a Happy Thanksgiving and again we’ll be getting the bird. It really seems committing to $150,000,000 that will despite comments “probably” will affect (that means increase) our water rates.  The questions the ALJ posed were focused on where the money was supposed to be spent on, not on whether the requirements were reasonable technically. The CPUC Commissioners already classified the proceedings, “No public review or comment is required for this resolution pursuant to Rule 14.7. “.

The next questions are will the SJWC response to the ALJ Ruling be available, to the public? I own 10 shares of SJW Corp. common stock, as a shareholder (very, very, small) when will I get notice of being diluted by the sale of more stock? I thought we were starting the beginning of a new day of transparency and openness, on the part of CPUC? Oops, Governor Brown vetoed those laws.

A1508016 Proceedings are available from CPUC online.

If you're concerned about how these funds will be used by SJW Corp./SJWC send email to:

Please send email,

 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 currently contested issues 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. 

Please consider pasting the following, or parts you agree with, when you fill in the eForm:

"I am concerned about the $150,000,000 funding package that SJW Corp./SJWC has submitted an application (A1508016) to CPUC, for approval. I'm concerned about the potential effect this may have on increased future water rates, the possibility of these funds being used by SJW Corp. to fund the acquisition of existing water systems, the concern of mixing the funds within the two corporation SJW and the regulated water utility SJWC and the continuing practice making access to information by ratepayers difficult, which is apparently not fully supporting the openness and transparency that CPUC and a majority of elected officials in Sacramento appear to support."

CPUC Public Advisor public.advisor@cpuc.ca.gov  Reference San Jose Water Company (SJWC) A1508016.The Public Adviser will insure your email will be sent to all the appropriate CPUC staff members and commissioners. 

Other people to drop an email (note) and express your opinion are:

• Scott Herhold, San Jose Mercury News, sherhold@mercurynews.com
• Paul Rodgers, San Jose Mercury News, progers@mercurynews.com
• Julie Putnam, NBC Channel 5, julie.putnam@nbcuni.com

California Drought 2011 to ???? - Fact and Fiction

How bad can the drought get? An alternate history of the "California Drought" of 2011....... is a fiction account of what could happen, in a worst case drought scenario. The book is an example of a new genre, "Apocalyptic Climate Fiction".  The big question that science can't answer is "California entering a long term drought?". Did the Anasazi civilization disappear, in the southwest, during the period 1200-1300 AD because of a mega-drought?

It becomes clear that droughts are not new to California, historically we get a severe drought every 10-20 years. The Assessment Report: Causes and Predictability of the 2011-14 California Drought" is a factual analysis prepared by NOAA (National Oceanic and Atmospheric Administration). It looks at some of the root causes, keep in mind our current 2011-? drought, is a result of many issues and factors. (links for both books are in the right column)

When the population and industry were less than a million people the rainfall was generally adequate near the major rivers, now the state population is 38.8 million and rising. Where will the water and electricity come from? A Newsweek article on 7/1/2015 covered the California Drought very well. 

We are also caught in a loss of 10% of the State's power generation as our Sierra snowpack has slowly disappeared since 2011 and two major nuclear plants are not in service or running well below normal output. The results in a potential issue of drought, but of a power shortage.

Hydroelectric power allows the state to pump the water from the rivers into the aqueducts, reservoirs and subsurface water banks and out for use. The combination of no snowpack, below average rainfall and decreasing available Hydroelectric power means Southern California is increasingly hard pressed in both areas water and electricity. 

Where is the water going? Lots of misleading information is available and published. The pie chart shows that in reality those "nasty" farmers do use water, but they are only 40% of the problem and city folks are 10%.

The state needs to put some programs to make in easier to reduce agricultural water use, rather than field flooding. Increasing the cost of water to farmers, controlling the groundwater pumping and financial support for drip irrigation and other lower water use methods of farming make sense. Do you realize those ships bring Asian goods to the California ports sometimes carry hay and alfalfa back to feed cows, for the dairy industry in Japan and China. Does it make sense to ship fodder 6,000-7,000 miles? Especially since growing both use a lot of water. Can't we find other products to load those empty ships going to Asia with?

The other 50% of the available water is controlled by the Federal Government and the State (in part because of the ecology lobby and special interests). Run off is required to insure the bay, delta and rivers remain healthy. There are also requirements to support endangered species, spawning and environmental conditions for salmon and smelt.

What causes droughts in the US western states? Population is a factor, climate change very likely, SST (Sea Surface Temperature) very likely (buy and read the NOAA Report), how efficiently we use and save the available water. We hear the California TV weather folks talk about "El Nino", the map shows a major  El Nino event is underway, in 2015. An unanswered question is what causes changes in SST? A NOAA report is available on SST may be downloaded.  The water temperatures dramatically increase and the whales and predators (sharks and Orcas) follow the small fish inshore and further north,  as you notice in the news reports. There has been roughly a 1%+ annual decline in the number of diatoms, since 1998.  Diatoms are the start of the food chain in our oceans and when they die they capture CO₂ and hold it in the sediments.   

Will a very strong El Nino guarantee rain this winter, maybe. The odds are improving that we will have a wet winter, but we will still have a deficit of water because of the past several dry years.We need to do more to conserve and store water and generate more renewable electric power.

Many folks want to believe that man's effect on the environment is the only cause? Historically we have had little ice age (1700's) and remember the sun happens to provide the light and heat for us. Can man effect the climate yes, the question is how much?

A lot of controversy centers around, "What is causing the worldwide temperature to go up"?  Basically it is increasing and several factors are causing it, CO₂ emissions caused by vehicles, power plants (especially coal fired), other greenhouse gases, particles of solids in the upper atmosphere (volcanos, coal burning, clearing forests by burning, aircraft burning jet fuel at high altitudes). Take your pick, "whatever lights your fire". (pun intended) The reality is all probably contribute to global warming. 

What can we do? Lots of people are looking at the issues and the economic impacts of solutions. We will not make a mistake by reducing the emission of greenhouse gases and particulates, but we are only a small part of the globe, a lot of other countries affect our weather and the air we breath.. We are coming up on a couple of key decisions that will be made by CPUC. The first is the issue of net metering for solar installations. This can economically remove the incentives for conversion to one of the key renewable power sources for ratepayers, both residential and companies. All three three major power companies in California want to get a cut of the savings ratepayers are getting by using solar power. This may at first look a water related issue, think, " we use electricity to move the water through California's canal, reservoirs and aqueducts". If we have to use power from traditional power plants we use water (good old steam), if their coal (worst), oil (better) or gas (best) you generate electricity and particles of soot and CO₂. The more hybrid or all electric vehicles can use solar residential power to re-charge, reducing emissions.

This all falls apart if the big three electric companies get their foot in the door and hand on our wallets. There is a place and potential profits for their shareholders, based on solutions that will not damage the current solar industry and the ratepayers interests, both financial and ecological. 

Many have expressed we are at the critical point and climate change will continue to accelerate. The graph above is definitely a concern. Can we solve China's use of massive amounts of coal to produce power? unlikely. Can we protect our solar industry from the efforts of the three major electric companies? Can we make it worse by shipping poor quality coal to China? yes. (Port of Oakland)

The simple reality is we live in a very narrow strip of land from San Francisco to San Diego that is considered a "mediterranean climate", 50-60% of the state is marginal to semi-desert. This is maintained and made extremely useful agricultural acreage through the statewide water systems.

We are dependent on the infrastructure investments made Federal and State, in projects to capture runoff from the yearly cycle and wet season winters, many years ago. We have failed to create sufficient added capacity and infrastructure to survive an extended drought, with the current population (38+ million), agricultural demands and the environmental requirements. 

What are the options we have? Let's separate them by chronological availability:

•  Conservation, the present program addresses 10% of the available annual water usage, consumers in urban areas our 20% reduction actually only affects 2% of the available water. We have publicly owned utilities making an 8%+ profit, in a financial environment with inflation at 3% or less annually. We have an ugly list of compromises made by agencies with companies they were supposed to "regulate" and protect the interests of ratepayers/consumers. We are now paying for the agencies failures to protect consumer rights and guarantee the monies were properly spent effectively on infrastructure.The current conservation programs depend on consumers making investments that won't be even a break-even over a short period of time, since as we conserve the utilities claimed fixed costs will cause rates to increase. The cost of an acre foot when purchased from the local water district is also "automatically" passed through to consumers using an "Advise Letter" supposed to be for a non-controversial subject, with 20 days from issue to object for a limited number of reasons and no other review........consumers have little voice and visibility in the process. A hard look should also be made into the business practices and efficiency of the State's water districts.
• Storm rains may be significant this winter, but a lot is simply allowed to drain off into the ocean, unless it falls into a watershed of a reservoir. Capturing more of this and using to replenish the underground aquifers (storage for future use) seems to be one of the shorter term potential programs that we need to look at.  
• Recycling water both urban consumer and farmers is the next likely area of a long-term conservation benefits. Restoring the depleted aquifers, underground storage, is a mandatory requirement, using recycled water is a good point to start. Protection of the water bank storage is also required. We don't know who is or has pumped effluent from fracking and drilling into critical underground areas. The State of California has an agency chartered to do this EPA has expressed concerns with the data collected and the management of the companies drilling wells and using surfaces ponds.
• Agricultural water requirements are 40% of the available water, the only short term solution is to charge farmers a higher price per acre foot, they pay a very low rate per acre foot, and accept that some acreage will be left fallow for food production. We are finding the price per acre foot has gone from $100-$150 to $1200 or more. Mainly farmers with Senior Water Rights have let acreage go unwatered and sold the water to the highest bidder. Which raises the issue of senior water rights and the legal morass of making any changes. The best compromise is to offer support to farmers to conserve water and provide fincial support to modernize their use of water and continue to make an effort to resolve the senior rights issues as Australia has.
• We will be faced with CPUC making a decision shortly that could either increase or decrease the rate of installation of consumer solar power systems. The three major California electric companies are in the long term confronted with a financial problem they have an existing infrastructure that they want us to pay for as long as possible. They want to get every cent possible from us to pay for existing facilities to satisfy their shareholders, by charging us a monthly solar fee for their infrastructure. The question is how much is fair to the consumer/ratepayers? We will be paying for the "friendship" between the regulators and the regulated companies, for many years. Another post as this is another complex set of issues, but if they get a fee for their infrastructure how long should it be for? Reviewed every three years?
• Longer term 5 years plus we have increased reservoir, underground water bank storage, recycling and salt water distillation. Lots of potential solutions and many questions all have a "significant political" component. All will finally come back to how much will you pay!

SJWC transcript 8/19/15 Status Conference (WRAM, Bonuses, Conservation, Freedom of Information)

The following is the CPUC transcript for the GRC A1501002 8/19/2015:

August 31, 2015

TRANSCRIPT

REPORTING SECTION

8/19/15 Status Conference; Vol. 5; Pages 448-464.

Click for access to the PDF file of the transcript

The transcript indicates open issues regarding the time periods between the Governor's Drought Executive Order, issues concerning the actual water sales by SJWC during the periods and the likely "bounce back" increase in water use after the expiration of the drought controls and surcharges (penalties). The objective is to prevent a large surcharge from accumulating and be billed to ratepayers after the drought controls are rescinded or expire, a good objective.

We still have significant pending contested issues, as documented in my posting to this blog, before a settlement (a proposal) can be submitted to the CPUC Commission for a decision.

You should note that the transcript indicates that SJWC customers reduced water consumption by over 35%, 5% over the 30% reduction imposed by an agreement of SCVWD (Santa Clara Water District), SJWC and the City of San Jose, in response to the State Water Board required 20%.

I would argue that the current revenue protection that is in place for SJWC is adequate, while SJWC will argue that a full decoupling of sales and revenue is required to protect them and allow them to continue to pursue conservation measures. Hmm, we the customers exceeded expectations beyond both the State and the SCVWD requirements.  I don't recall any new efforts by SJWC to promote water conservation.

I'm sure the SJWC managers and officers deserve annual bonuses based on motivating SJWC customers to exceed conservation expectations, LOL. Hmm it could at best be argued that their contribution was a "speedy" implementation of DS1 and DS2 drought surcharges, in time to be included in the first water bill after the the Governor's Executive Order was effective. I seem to remember SJWC saying it would take weeks if not months to make changes to their billing software.........some changes are apparently easier to make than others  (;->) (an emoticon). You should also note that SJWC was prepared in 1992 tocalculate water savings based on each customer's prior usage.

An issue of Public Information, the transcript cost me $34.00 to get a copy. Interestingly it existed as both an Adobe PDF and an MS-Word file and was sent to me within a day of my request, I also received a hardcopy of the transcript. Yet it can't be downloaded from the CPUC GRC A1501002 docket/documents available online on the CPUC website? I know for a fact that Adobe PDF files can be password locked to prevent modification. So I have to assume that CPUC wants to limit access to information that should be easily provide at no charge. If you send email to the CPUC Public Advisor they will forward your request to the CPUC ALJ Division – Reporting Section who are helpful. I wonder if the legislation in process in Sacramento have any effect on making the transcripts downloadable and free?

FYI, the transcript download is hosted on my free account at Google, really time consuming and expensive, to make the transcript available, "right". The file can be downloaded, but the copy hosted on Google cannot be modified by the public.

8 week schedule slip? SJWC 2016, 2017, 2018 - RATE CASE AND INCREASE

The original Plan Schedule has "slipped" from a planned June 15, 2015 Mandatory Conference, to August 19, 2015. It's understandable that there would be a slip due to drought related actions that were required, as well as some difficult negotiation on several topics.

Click to view schedule, Exhibit A

SJWC has already requested and received approval for interim rates, starting on January 1, 2016, An encouraging item is SJWC requested current rate plus an optional inflation increase by month. Obviously they'll charge the difference between inflation and the likely 8-10% annual increase for 2016 when CPUC commissioners approve the resolution to the rate case.

The contested issues still are open as I posted, on this blog.

SJWC Requested Item	Status	Blogger Comment
WRAM full de-coupling of revenue and sales	Contested as of 9/18/15	PG&E got an ERAM, guarantees revenue independent of sales. Over the past 25 years have PG&E customers benefited?
WRAM contingent conservation programs	Contested as of 9/18/15	The proposed rate is 2,000 toilets a year, there are over 1 million toilets in SJWC system. Are you going to live long enough to get a free low flow toilet?
Staffing requests for 33 new staff positions	Contested as of 9/18/15	Since it appears that SJWC is delivering less water, has available man-hours(6 staff full-time) to use for NTP&S, do they really need 33 more staff people that we would pay for or would they be used for NTP&S?
Bonuses for Officers and Managers	Contested as of 9/18/15	Who should pay?You ( SJWC customers) or Shareholders? Shareholders set goals for their benefit, not SJWC customers.
Non-Tariffed Products and Services (“NTP&S”)	Tentative Agreement	Tentative Agreement, Appendix A Relates to staffing request, above.
Other financial items have contingent agreements or are pending and contested	Pending  as of 9/18/2015	Pending resolution of contested Items

I also have a previous post to this blog discussing the items above in more detail.

Please send email,

 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 currently contested issues 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. 

Please consider pasting the following, or parts you agree with, when you fill in the eForm:

"I OPPOSE SJWC paying management and officers bonuses with money included in our water rates, bonuses benefit shareholders, shareholders should pay the bonuses. I oppose a WRAM separating revenues from sales, I oppose using regulated staff for unregulated projects with insufficient controls, reporting and evaluation of the risk/reward for ratepayers. I oppose a major staffing increase of 33 positions, an almost 10% staff increase. I oppose proposals by SJWC that discriminate against seniors or other classes of SJWC ratepayers. Reference San Jose Water Company (SJWC) GRC 1501002."

You can also send an email to express your opinion on who should pay the bonuses you or the shareholders:

CPUC Public Advisor public.advisor@cpuc.ca.gov  Reference San Jose Water Company (SJWC) GRC 1501002.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
• Paul Rodgers, San Jose Mercury News, progers@mercurynews.com
• Julie Putnam, NBC Channel 5, julie.putnam@nbcuni.com