Assignment of Proceeding
Susan P. Kennedy is the Assigned Commissioner and John E. Thorson is the assigned Administrative Law Judge in this proceeding.
Findings of Fact
1. 1,2,3-Trichloropropane (TCPA) is a chemical historically used as a solvent and in the manufacturing of pesticides. The substance has been known to cause cancer in laboratory animals and is reasonably anticipated to be a human carcinogen.
2. In California, DHS does not regulate TCPA by establishing a Maximum Contaminant Level (MCL). Rather, DHS considers TCPA to be an unregulated contaminant for which monitoring is required.
3. DHS has issued Action Levels, which are health-based advisory levels, for chemicals in drinking water for which MCLs have not been established (such as TCPA).
4. For TCPA, DHS has established an Action Level of 5 parts per trillion (ppt) or 0.005 micrograms per liter (μg/L).
5. If the Action Level is exceeded for a drinking water source, California Health and Safety Code § 116455 (2004) requires the drinking water system operator to notify the governing body of the local agency in which users of the drinking water reside. This notification is to occur within 30 days of the discovery of the Action Level exceedance.
6. If the Action Level is exceeded for a drinking water source, DHS recommends that the utility inform its customers about the presence of the contaminant and its potential for adverse health effects at high levels of exposure.
7. If the Action Level is based, as here, on cancer risk, DHS recommends that the source of water be taken out of service if the contaminant is present at 100 times or more of the Action Level. For TCPA, 100 times the Action Level is 0.5 μg/L.
8. CWS has an ongoing quarterly monitoring program for any well where TCPA has been detected above the Action Level.
9. CWS intends to notify its customers in any district where the presence of TCPA has exceeded the Action Level. This notification will be sent by July 1, 2004, and thereafter as necessary, as part of the utility's annual Consumer Confidence Report, recognized by DHS as an appropriate method for notifying customers.
10. CWS began unregulated contaminant monitoring (UCMR) in its water systems in May 2002, followed by additional testing five to seven months later. Monitoring was not completed until 2003.
11. CWS had knowledge of the presence of TCPA in wells in the Bakersfield and South San Francisco districts when it filed its ratesetting applications on October 1, 2003.
12. The testing and monitoring disclosed that certain wells in the Bakersfield and South San Francisco districts had TCPA levels that exceeded the Action Level. The testing and monitoring of wells in the Mid-Peninsula, Salinas, and Stockton districts disclosed no measurable amounts of TCPA.
13. On January 6, 2004, CWS notified by mail the mayor and city council of the City of South San Francisco about the presence of TCPA in amounts exceeding the Action Level, in certain district wells.
14. On January 29, 2004, CWS notified by mail the mayor and city council of the City of Bakersfield about the presence of TCPA in amounts exceeding the Action Level, in certain district wells.
15. CWS failed to notify the local officials of South San Francisco and Bakersfield within 30 days of discovering that TCPA was present in excess of the Action Level in some of the districts' wells, as required by Health and Safety Code § 116455.
16. Twenty-three of the Bakersfield wells (out of a total of 110 wells) showed contamination in excess of the Action Level. None of the wells exceeded 100 times the Action Level (0.5 μg/L). The four wells with the highest levels were registered at 0.28, 0.25, 0.14, and 0.057 μg/L.
17. Three of the South San Francisco wells showed contamination in excess of the Action Level. None of the wells exceeded 100 times the Action Level (0.5 μg/L). The wells registered levels of 0.150, 0.142, and 0.052 μg/L.
18. While the water from certain Bakersfield and South San Francisco wells exceeds the Action Level, this water is intermixed with water from other wells and sources of supply before it is delivered to customers, thereby diluting the levels of TCPA.
19. In the Stockton District, facilities are being constructed to mitigate arsenic so that the District's finished water supply meets the new federal contaminant level of ten parts per billion, effective in January 2006. These capital costs are estimated at $6.1 million in 2004 and $11.2 million in 2005, a total of $17.3 million.
20. In the Salinas District, facilities are being constructed to mitigate groundwater contamination from nitrates, MTBE, arsenic, and other contaminants. These capital costs are estimated at $3.2 million 2004 and $2.7 million in 2005, a total of $5.9 million.
21. CWS is expected to re-file its general rate cases for the Stockton, Salinas, and Mid-Peninsula districts later in 2004.
1. Under California law, TCPA is an unregulated contaminant for which monitoring is required.
2. Under California law, there is no maximum contaminant level (MCL) for TCPA in drinking water supplies. Rather, DHS has established an Action Level of 5 parts per trillion (ppt) (0.005 μg/L) for TCPA. If the Action Level is exceeded, DHS specifies certain required and recommended actions. If the exceedance is 100 times the Action Level, DHS recommends that the source be taken out of service.
3. The TCPA Action Level has been exceeded in 23 wells in the Bakersfield District and three wells in the South San Francisco District. None of these wells exceed the Action Level by 100 times.
4. None of the wells reported to the Commission in the Salinas, Stockton, and Mid-Peninsula districts produce water exceeding the TCPA Action Level.
5. CWS failed to notify local officials in the Bakersfield and South San Francisco districts within 30 days of the discovery of TCPA Action Level exceedances, as required by Health and Safety Code § 116455. CWS has now satisfied this requirement by notifying the mayor and council in both cities.
6. CWS has complied, or has represented that it will comply, with all of DHS's recommendations for wells producing water exceeding the Action Level including periodic monitoring and notice to customers using the annual Consumer Confidence Reports.
7. Based on the representations, reports, and evidence provided by CWS to the Commission, the presence of TCPA in certain wells of the Bakersfield and South San Francisco districts does not pose a significant health risk to people ingesting the water produced from those wells on a daily basis. This finding, however, does not preclude some health risk since the action level has been set pending further scientific evaluation by DHS.
8. It is prudent and reasonable for CWS to use these Bakersfield and South San Francisco wells as a source of water supply for these districts.
9. The anticipated costs of water quality treatment capital expenditures in 2004 and 2005 in the Salinas and Stockton districts are significant. Memoranda accounts are appropriate to record these expenditures, subject to later ratemaking review by the Commission for justification of the need for the expenditures and their reasonableness.
IT IS ORDERED that:
1. While complying with any other requirement imposed by the Department of Health Services (DHS), any well in the Bakersfield or South San Francisco districts, previously removed because of water containing TCPA at levels exceeding the Action Level, may be returned to active service.
2. In its operation and management of the districts originally involved in this proceeding, California Water Service Company (CWS) shall comply with those recommended actions (as of the date of this decision) and required actions set forth by the California Health and Safety Code or DHS for drinking water supplies exceeding the TCPA Action Level.
3. CWS shall notify its customers of the Bakersfield and South San Francisco districts of the TCPA Action Level exceedances in the company's 2004 Consumer Confidence Report and, depending on test results, in subsequent years as well.
4. In the event water from any well exceeds 100 times the TCPA Action Level, CWS shall notify the Water Division within five business days of the confirmed test result.
5. Application (A.) 03-10-018 (Stockton), A.03-10-019 (Mid-Peninsula), A.03-10-020 (Salinas), and A.03-10-031 (Salinas) are dismissed, under the terms and conditions of this decision, without prejudice.
6. CWS is authorized to establish memoranda accounts to record water quality capital expenditures during 2004 and 2005 in the Salinas and Stockton districts. The Commission will review these expenditures for need and reasonableness either during these districts' next general rate cases or upon specific application by the company.
7. Proceedings concerning A.03-10-017 (South San Francisco) and A.03-10-021 (Bakersfield) shall continue as specified in the Scoping Memo.
8. In the proposed final decision on A.03-10-017 and A.03-10-021, the Administrative Law Judge will recommend whether any sanction concerning the violation of Health and Safety Code § 116455 should be imposed and, if so, in what amount.
This order is effective today.
Dated , at San Francisco, California.
