The City's Authority

In the summary of its response to MHC's Motion, the City summarizes the issues in this proceeding as being whether the CPUC or MHC "has the authority to compel the City of Santa Cruz to allow resale of its water on the terms proposed by MHC." A similar theme runs through the Homeowners Association opposition to the motion.

The only allegation made in any documents in this proceeding regarding the City being compelled against its will to provide water and sewer service to MHC is found in MHC's federal court complaint. There, MHC contends that the City has a legal obligation created by its municipal ordinances and an implied-at-law contract to sell water and sewer services to MHC. If the City's one sentence summary of this proceeding is accurate, the only issue the City would like resolved in this proceeding is already pending in federal court. Similarly, in its request for a declaratory determination, MHC asks this Commission to find that the City's decision denying MHC a water and sewer resale permit frustrates the Commission's authority to set MHC's rates. This question is also pending before the federal courts, in the suit brought by MHC.

We decline to go any further than our conclusion that this Commission may set rates for MHC, and has done so. Whether the City has the right and/or the duty to sell water or sewer service to MHC for resale (and the terms for such sale for resale) is not a question that can properly be placed before this Commission by a complaint under § 1702.