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UPDATE: Valencia Water proposes rate hike

Water would go up 11 percent or more if state approves

Posted: January 18, 2013 1:35 p.m.
Updated: January 18, 2013 5:43 p.m.

Valencia Water Company customers will see their rates increase by at least 11 percent in 2014 under a proposal submitted to the California Public Utilities Commission.

Under the rate-hike proposal, Valencia Water would increase monthly rates by $4.41, $5.83 or $8.66, depending on customers’ water usage.

This would result in $3.1 million in additional operating revenues for Valencia Water in 2014, an increase of 12.7 percent over current levels, and another $887,762 in new revenues in 2015.

Keith Abercrombie, the general manager of Valencia Water, said the rate increases are part of a regular process.

The planning process for the latest proposal began in early 2012, Abercrombie said. Every three years private utility companies must file paperwork with the California Public Utilities Commission detailing rate proposals.

The rate hike is subject to approval by the commission.

Valencia Water asked for a rate hike for a variety of purposes, including system maintenance, operating expenses and the company’s own utility bills.

“There’s not any one big expense,” Abercrombie said. “It’s just the normal cost of operating a water agency.”

Abercrombie also said the proposed rate increases have nothing to do with the Castaic Lake Water Agency’s recent purchase of Valencia Water.

“We don’t just send something in and get what we ask for,” Abercrombie said of the utilities commission review process. “We have to justify our proposal and make our case.”

The Castaic Lake Water Agency agreed to purchase Valencia Water in December. At that time, the agency, which is a water wholesaler, said the purchase would help stabilize water rates in the Santa Clarita Valley.

Dan Masnada, general manager for Castaic Lake Water Agency, said stabilized rates will still be the long-term effect of the purchase.

Masnada said the hikes were not a consideration when Castaic Lake agreed to purchase Valencia Water.

“This rate-making process has nothing absolutely to do with the acquisition,” Masnada said. “That application would have gone ahead regardless.”

Masnada said the agency board was aware of the proposed rate hikes before approving the acquisition and may have addressed them “in passing” in a public meeting.
On Twitter @LukeMMoney






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