II. Applications

On November 8, 2002, CWS filed general rate applications for its Antelope Valley District and Kern River Valley District. CWS requested to increase rates in its Antelope Valley District by $60,300, or 5.8%, in 2003; by $130,600, or 11.8%, in 2004; by $126,900, or 10.2%, in 2005; and, $127,500, or 9.3%, in 2006. It also requested to increase rates in its Kern River Valley District by $913,200, or 46.9%, in 2003; by $1,48,800, or 5.3%, in 2004; by $137,500, or 4.6%, in 2005; and, $139,000, or 4.4%, in 2006. Customers were advised of these proposed rate increases through newspaper publications and bill inserts.

CWS stated that these rate increases are necessary to pass through to its customers increased expenses to CWS for services and commodities furnished by it and changes in both water uses and rate bases. It cited stringent water quality standards enacted by the United States Environmental Protection Agency as the most significant factor requiring rate increases.