In
order to take over a water utility, Scow said a community must raise
funds to purchase the company at a fair market value. This value can
be tricky to determine, especially when pipes and infrastructure are
deteriorating and corporate investors are involved. Also needed is
a local agency willing to take on the bureaucracy of running a public
utility.
Kathy
Richards worked for the City of Los Angeles Department of Water and
Power for 30 years before moving to Ojai. She said the three valley
agencies most likely to be able to take on running the water system
are the City of Ojai, Casitas Municipal Water District and the Ojai
Valley Sanitary District. The commitment to take on a system that
is in need of deferred maintenance and upgrades will not be easy to
obtain.
“The
infrastructure is in such bad shape,” said Richards. “That's why Casitas
wasn't interested in taking over in '98. These agencies already have
customers. They don't want to take on something that is a burden to
their existing customer base.” Local board members would need to be
convinced by constituents of the importance of such a move.
Shortly
after Richards moved here, Golden State applied for its 1998 rate
increase, and she served on commissions during the process. Richards
said the city then researched and considered taking over the water
system as a public utility. Because research indicated that making
Ojai water a public utility would increase rates about 40 percent,
the city abandoned the idea in 1998.
Also
of concern were California water laws, which specify that the purchasing
body must pay legal fees for the water company, as well as their own.
Scow said in order to take over a private utility, the local governing
body must often claim it through eminent domain. Richards added the
fair market value of the system is determined at a jury trial. The
outcome of that trial may be appealed all the way to the California
State Supreme Court.
Once
a community creates a public utility, new bureaucracy must be created
for its running and funds procured for the endeavor. Scow said that
in order to take over their water companies, cities like Felton, Calif.
have had to promote and pass a bond measure to increase taxes to pay
for the utility. Most do not see rates decrease for another 10 years.
“The question you have to ask yourselves is where do you want that
money to be going? Back into the system or into the hands of a private
company with investors to pay?”
Funding
the legal process to purchase and run a public water company sounded
daunting to many at the meeting. Others felt that keeping local control
over a fundamental need was worth the effort. Sean Keenan asked, “Do
we want to be in charge of water rates, or do we want to have a private
company raise them?”
Attendee
Pete LaFollette voiced concern over who would be running a public
water company in Ojai. “I would be more than a little nervous if the
Ojai City Council would be administering the water system.”
Richards
stressed that in order to accomplish the many steps needed to set
up a public water district, a cooperative approach by all parties
involved must be maintained.
“It
is my belief we can create an organization that will benefit all of
us,” said Couturie. “I hope we can all come together to work towards
this.”
Scow
recommended that Golden State customers should attend the CPUC public
meeting Thursday. “Let the judge know how you feel about the rate
increase,” he said. That public participation hearing takes place
at 7 p.m. in the Chaparral Auditorium.
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