5. Assignment of Proceeding

Michael R. Peevey is the assigned Commissioner and Steven Kotz is the assigned Administrative Law Judge in this proceeding.

Findings of Fact

1. Decision 10-12-017 adopted a heavily front-loaded revenue increase for Cal Water's Selma district.

2. The City of Selma and its residents are experiencing financial hardships.

3. The Petitioners' proposed two-step phase-in of the rate increase imposes no burden on other Cal Water districts, does not result in a net change to Cal Water's revenue requirement, and does not adversely affect Cal Water's ability to recover its revenue requirement in rates.

4. The proposed phase-in is reasonable.

5. There is no opposition to the petition for modification.

6. Cal Water's supplement to the petition contains proposed tariff schedules to implement a 10-month rate reduction for the Selma district.

Conclusions of Law

1. Cal Water's motion to supplement the petition for modification should be granted.

2. The Petitioners' petition for modification of D.10-12-017 should be adopted, effectively immediately, and the proceeding should be closed.

3. Cal Water should file and serve, within 10 days of the effective date of today's decision, a Tier 1 advice letter setting forth appropriately revised tariffs for the Selma district to implement the phase-in of the rate increase.

4. To reinstate the Selma district rates previously authorized in D.10-12-017, starting July 1, 2012, together with a flat monthly surcharge of $2.19 applicable to all customer bills for a period of three years, Cal Water should file a Tier 2 advice letter no later than May 30, 2012.

5. The otherwise applicable period for public review and comment should be waived.

ORDER

IT IS ORDERED that:

1. Public review and comment on the proposed decision herein is waived.

2. The motion of California Water Service Company to supplement the petition to modify Decision (D.) 10-12-017 is granted, and the petition to modify D.10-12-017 is approved.

3. Within 10 days of the effective date of this order, California Water Service Company must file and serve a Tier 1 advice letter setting forth revised tariffs to implement the phase-in of the rate increase for the Selma district. The revised tariffs must conform substantially to the "Proposed Tariff for the Selma District" contained in the Appendix to today's decision.

4. No later than May 30, 2012, California Water Service Company must file and serve a Tier 2 advice letter setting forth revised tariffs to (1) reinstate the Selma district rates authorized in Decision 10-12-017, and (2) impose a flat monthly surcharge of $2.19 applicable to all customer bills, effective July 1, 2012. The surcharge is to be in effect for three years starting on July 1, 2012.

5. Application 09-07-001 is closed.

This order is effective today.

Dated August 18, 2011, at San Francisco, California.

D1108010/A0907001 APPENDIX Kotz

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