CC - Item 4C - Authorization to oppose the proposed souther california water company rate increase - Box 070TO: HONORABLE MAYOR
AND MEMBERS
ROSEMEAD CITY COUNCIL
FROM: BILL CRO~ITY MANAGER
DATE: APRIL 8, 2003
RE: AUTHORIZATION TO OPPOSE THE PROPOSED SOUTHERN
CALIFORNIA WATER COMPANY RATE INCREASE
In October 2002, Southern California Water Company (SCWC) filed an application (see
attachment) for authority to increase rates, which would increase water rates in Rosemead
by 37.3% in 2003, and an additional 5% in 2004, and 6.64% in 2005. This increase would
affect. 3,246 customers in Rosemead. SCWC's application to the Public Utilities
Commission was justified on the basis of increased operating.costs for items such as
purchased water, pump taxes, power for pumping, capital financing for water system
improvements, group health insurance, property insurance, labor, payroll taxes, postage,
liability insurance, depreciation; materials, purchased services, security-related
expenditures, and other general office related costs.
At our request,.SCWC managers met with us to explain the proposed rate increase. We
_were not convinced of the justification for such a large increase and therefore indicated
that we would oppose the increase. SCWC requested a second meeting at which they
proposed a number of options for reducing the rate increase request (copy also attached).
While some of the suggested options had merit, we still were not presented with
sufficient justification for even the alternate rate increase structure. Consequently, we
once again advised SCWC that we could not support the recommended rate increase or
the alternate rate structure.
This matter has been set for a Public Utilities Commission public hearing on April 28`i' in
Claremont. This is the first in a series of local hearings that will be held to allow for input
from the public who will be affected by the rate increase.
RECOMMENDATION
Authorize preparation of written and/or oral testimony for the upcoming PUC hearing to
oppose the proposed water rate. increase, based on it being excessive and unjustified.
OLIN .IL AGENDA
AP,R.0.8 2003
ITEM No. "-C'