3. Procedural History
On February 3, 2006, CWS filed A.06-02-003, requesting Commission authorization to enter into a SDWSRF loan, in the amount of $4,500,000, and to institute an associated surcharge and service fee.
On December 12, 2006, CWS amended A.06-02-003 to request a higher loan amount of $5,676,277. The Commission could not act on that application, because CWS' proposed expenditures and construction plans were continually in flux. On November 1, 2007, the Commission authorized the withdrawal of A.06-02-003, at the request of CWS.4 The current application, filed with the Commission on November 20, 2007, is for this same loan, except in the increased amount of $7,442,700.
3.1 Categorization of Proceeding and Customer Notice
CWS requested that this matter be categorized as ratesetting, and that, in its view, hearings are unnecessary. By Resolution ALJ 176-3204, dated December 6, 2007, the Commission preliminary determined that the case was a ratesetting proceeding and that no hearing was expected.
Pursuant to Rule 3.2(b)(d) of the Commission's Rules of Practice and Procedures, CWS notified its customers of A.07-11-020 via a mailing with the bill or a special mailing (depending on the customers' billing cycle), and via publication in the Lake County Record-Bee newspaper on December 8, 2007. Though verbal questions about the project have been received by CWS at its district office and written questions have been received by the Commission, no protests to the applications or objections to the ratesetting categorization were filed. We find that the proceeding is properly categorized and that hearings are unnecessary.
3.2 Customer Concerns
In December 2007, concerned customers in the Lucerne service area sent the Commission a letter regarding A.07-07-001, which, in part, addressed the incorporation of authorized General Office Revenue Requirement changes to rates charged in the Lucerne service area. Even though this letter was not submitted in the current case, it does reflect the concerns of the Lucerne service area customers.5 Customers voiced their concerns regarding water quality, the delay in building the treatment plant, as well as its proposed cost, and rate increases that the local community can ill afford.
3.3 Public Meeting
Based on the comments from its customers, CWS held an informal public meeting on Wednesday May 7, 2008, at the Lucerne Alpine Senior Center. The meeting started at 7:00 PM, and adjourned at 9:15 PM, with approximately 150 customers in attendance. The attending DWA representative explained Commission procedures, as well as the purpose of the meeting. A CWS representative explained the need for the rate increase. Also in attendance were representatives from the Division of Ratepayer Advocates (DRA), the CDPH, the County Redevelopment Agency, the Lucerne Community Water Organization (LCWO), and a County Supervisor. The rest of the meeting consisted of comments and questions by the customers.
The customers, many of whom are low-income, are very concerned about their inability to pay the higher rates for water service. In particular, the LCWO presented staff with a petition to the Commission, expressing concern over the increased cost of the new treatment plant. The petition was signed by over 450 individuals.
The customers in attendance at the meeting asked numerous detailed questions regarding the substantial cost increases of the project over the last few years, reasons for incurring specific types of costs, the regulatory processes at the Commission and the CDPH, whether CWS will earn a profit on the project, and concerns regarding the number of rate increases in the recent past.
Subsequent to this public meeting, the Commission received two letters from customers in the Lucerne service area, in which they expressed similar concerns and posed some of the questions that were voiced at the public meeting.
4 D.07-11-019, Order of Dismissal.
5 See D.07-05-062, pg.11-12.
