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Castaic Lake Water Agency expected to close purchase of Valencia Water Co.

Posted: December 20, 2012 8:39 p.m.
Updated: December 20, 2012 8:39 p.m.

 The Castaic Lake Water Agency is expected to close a deal Friday to buy the Valencia Water Co. from Newhall Land Development Inc.

“On Friday, Newhall Land gets their money and we have ownership of their stock,” said Dan Masnada, general manager of the Castaic Lake Water Agency.

On Wednesday, at a “special meeting” of the agency’s board of directors, only one “special procedure” topic was on the agenda — the execution and entry into a settlement agreement with Newhall Land.

Once the deal was signed, members of the board were asked to appoint the Valencia Water Co. board of directors.

With two dissenting votes, the board elected to the Valencia Water Company board of directors: Masnada; Valerie Pryor, the agency’s administrative services manager; Mauricio Guardado, retail manager for Santa Clarita Water Division; Keith Abercrombie, general manager of Valencia Water Co.; and Greg Milleman, also of Valencia Water Co.

The board is expected to serve for a 75-day interim period while the Valencia Water Co. makes the transition from being a utility answerable to the California Public Utilities Commission.



A week ago, by a vote of 9 to 1, directors on the Castaic Lake Water Agency board voted in favor of buying the Valencia Water Co.

At that point, the agency had the approval to buy one of the Santa Clarita Valley’s privately held water retailers, which would give it 84 percent of the valley’s retail water connections.

On Wednesday, they closed the deal.

Before Wednesday’s move, the agency’s General Manager Dan Masnada, board member Bill Cooper and agency lawyer Hunt Braly met with the editorial board of The Signal.

In candid discussion of the agency’s plan for the future, it was revealed that the agency’s vision is that “one day” all wholesale and retail management of water distributed in the Santa Clarita Valley might be managed under one umbrella group.

“When we purchased the Santa Clarita Water Co. (in 1999), we were asked ‘How do we deal with both these issues?’” Cooper said, referring to concerns of one group managing both the wholesale and retail management of water resources.

“We bought it for water resource management,” he said. “This is going to be another step.”

The Valencia Water Co. and the Santa Clarita Water (Company) Division are about the same size.

Down the road, the agency envisions managing its retail concerns as one retail operation.

“Our vision is a single retail operation,” Masnada said.

Cooper explained the agency’s One Valley, One Vision, one water agency as this: “It makes sense to have one water company. If you have one entity. It doesn’t have to be the Castaic Lake Water Agency. You can call it whatever. You can call it the Santa Clarita Valley Water Authority that operates and maintains the water system for the valley. It makes sense to have it under one entity.”



Valencia Water Co. was established in 1954 to provide retail water service to Newhall Land’s Valencia developments. It has 29,022 service connections.

The Castaic Lake Water Agency is a wholesaler that provides State Water Project water to the Santa Clarita Valley’s water retailers. About half the water used in Santa Clarita Valley homes and businesses comes from CLWA. The rest is well water.

Castaic Lake already owns Santa Clarita Water Division, another water retailer. The remaining retailers in the valley include District 36, which has a small clientele in Castaic and Val Verde, and Newhall County Water District, the oldest water retailer in the valley.

Newhall County and Castaic Lake are the only two local water districts governed by publicly elected boards.

Asked what he thought about Newhall County Water District ever merging with the agency, NCWD General Manager Steve Cole said: “Our district feels strongly that there should be separation between wholesale and retail.”

About the Valencia Water Co. acquisition, he said: “It might be better if the Valencia Water Company customers were allowed to form their own district.”






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