I. INTRODUCTION
Pursuant to section 855 of the California Public Utilities Code, the California Public Utilities Commission ("Commission") issues this Order Instituting Investigation ("OII"), Notice of Hearing, and Order to Show Cause ("OSC") regarding the Yermo Water Company ("Yermo") and its sole owner, Donald Walker, which hereafter are jointly and/or severally referred to as "the Respondents." Since 1993, the Respondents have been of concern to the Commission and the California Department of Public Health ("CDPH").1 Despite efforts by the Commission in Resolution (Res.) W-3812, its Water Utility Branch ("WUB") in 1995, and then the Water Division ("WD") in 2006, to require Yermo to improve its operations and comply with Commission requirements, the Respondents continue to flout not only the Commission's but also CDPH's regulatory mandates.2 Further, according to WD records, customer complaints have included inadequate water pressure, malodorous and potentially unsafe water supplies, service interruptions, contamination, inadequate fire protection equipment, and other operational problems. These violations are not merely regulatory faux pas, but have also imperiled the health and safety of all of Yermo's customers.
Moreover, it appears that Yermo's owner has de facto abandoned this water system. At the present time Yermo's owner resides in the state of Florida, and attempts to manage Yermo from that location. Under Section 855, the Commission has an obligation to petition the San Bernardino County Superior Court for appointment of a receiver to assume possession and operation of Yermo.
Section 855 states:
Whenever the commission determines, after notice and hearing, that any water or sewer system corporation is unable or unwilling to adequately serve its ratepayers or has been actually or effectively abandoned by its owners, or is unresponsive to the rules or orders of the commission, the commission may petition the superior court for the county within which the corporation has its principal office or place of business for the appointment of a receiver to assume possession of its property and to operate its system upon such terms and conditions as the court shall prescribe. . . . The court shall provide for disposition of the facilities and system in like manner as any other receivership proceeding in this state.
This statute requires the Commission to institute this investigation to protect Yermo's customers from the continuing hazards caused by the Respondents' negligent operation of Yermo and to address their unwillingness or inability to comply with Commission and CDPH rules and regulations. The discussion below details the Commission's interactions with the Respondents, and since 1993 how their violations of Section 855 warrant this investigation.
1 CDPH was formerly known as the California Department of Health Services.
2 The CDPH was formerly known as the Department of Health Services.
