OPINION: Investigations Show Gaps in Water Company's Defense

Golden State Water Company is not being forthright about their water rates and how they charge users, Claremont city officials said.

The following piece was released by the Claremont City officials:

Following a recent CBS investigation in which Golden State Water Company was shown to hide records related to its spending of ratepayer money, the Claremont-Courier reported on the challenges faced by ratepayers in understanding the many fees that are assessed by the private water company. Subsequently, Golden State Water has now begun to blame Claremont ratepayers for the high water costs. 

"As was pointed out in the Claremont-Courier, Claremont residents are forced to pay additional fees on their water bill whether they are high water users or choose to conserve. For Golden State Water to now blame Claremont ratepayers for the high water rates, especially when they have submitted an application for a 24.54% increase beginning in 2013, is outrageous," said Claremont Mayor Larry Schroeder, responding to Golden State Water's claims that Claremont residents are responsible for their high rates.

In an opinion piece printed in Wednesday's Inland Valley Bulletin, a Golden State Water official claims that Claremont residents are to blame for the higher costs and is urging residents to conserve water in order to best manage their bills.   This representative faults Claremont residents for the high costs, claiming they use more water than residents of neighboring cities, and goes on to encourage Claremont residents to conserve water. Amazingly, this same Golden State Water official neglects to mention the fact that ratepayers are assessed a WRAM fee, or Water Revenue Adjustment Mechanism, if they choose to conserve.  WRAM fees are charged when customers fail to use an amount of water sufficient to guarantee Golden State Water's profits.

"Golden State Water has learned how to take advantage of private water company laws in California, and they are now blaming our residents for the extremely high water rates in Claremont," said Mayor Schroeder. "If a customer chooses to conserve water in an effort to reduce their bill, Golden State Water's response is to charge them for not using enough water. We are being held hostage by Golden State Water's rate structure, greed and their demand for high profits."

In January 2012, the City Council held a public meeting on water issues and appropriated $200,000 to conduct a water acquisition study.  The City's consultants have toured the system, studied financial records, and appraised the system.  The consulting team will present the feasibility study to the City Council at a special closed session meeting on October 23.   The City will identify and examine multiple options to fund and operate the system, should it decide to end Golden State Water Company's monopoly and acquire the system. 

Scott in Claremont October 23, 2012 at 02:42 PM
Wasn't the WRAM supposed to create an incentive for conservation? How will Claremont meet its state mandated 20% water savings by 2020 if GSW penalizes people for conserving water? Shame on them. More on WRAM's here. http://policymatters.net/?p=671 . And the following from the their 2008 Annual Report may just prove they've stacked the deck. American States 2008 Annual Report "Public water policy also affects profitability. In 2008, three members of Golden State Water’s Environmental Quality Department assumed key leadership positions with the California-Nevada Section of the American Water Works Association, giving us a strong voice in crafting state and federal water regulations. We took strategic steps to ensure our profitability in the years to come. Perhaps the most important was securing the California Public Utilities Commission’s approval of a Water Revenue Adjustment Mechanism, or WRAM. The WRAM allows us to decouple revenues from sales, thereby avoiding the volatility in our earnings caused by drought, unseasonable temperatures, and other factors." Finally, we should probably expect the same scare tactics about risk. See what they are saying to Ojai residents here: http://ovnblog.com/p=5236 and here: http://www.smartvoter.org/2012/11/06/ca/vn/vote/becker_t/paper2.html Ojai is voting on a takeover of GSW in a few months, lets hope Claremont follows suit.


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