Rancho Palos Verdes City Council
   

TO: HONORABLE MAYOR AND COUNCILMEMBERS

FROM: CITY MANAGER

DATE: AUGUST 5, 2003

SUBJECT: CALIFORNIA WATER SERVICE COMPANY

APPLICATION FOR RATE INCREASE RECOMMENDATION:

Consider filing an objection to the proposed rate increase in the form of a letter to the California Public Utilities Commission and testimony at the Public Hearing on August 12, 2003.

BACKGROUND:

On January 31, 2003, California Water Service Company (Cal Water) filed an application with the California Public Utilities Commission for a series of rate increases of 12.1% in 2003, 4.8% in 2004, 4.8% in 2005 and 4.7% in 2006. Cal Water feels that the rates are justified due to increased operating expenses as well as capital expenditures in the Palos Verdes District over the next several years. The Public Hearing is scheduled for August 12, 2003 at 1:00 PM in the City of Palos Verdes Estates City Council Chambers. Written comments will also be circulated to the Commissioners and made part of the record.

DISCUSSION:

Councilmember McTaggart is concerned about the lack of specific justification that has been provided by Cal Water to justify a rate increase. The City has been trying for over two years to receive a copy of the Master Plan of Facility Improvements for Cal Water. As late as two weeks ago, we received a call from Mr. Bill Lowe of the Cal Water Headquarters Office in San Jose advising us that the Master Plan was still not available to us. Since the attempted residential development of the Cal Water property on Crest Road and the apparent abandonment of that site for the previously planned water reservoir, there has been confusion about how Cal Water intends to serve the City. Until satisfactory answers to these questions can be obtained, Councilmember McTaggart feels that any rate increase proposal is premature. Presently, the only information available for review by customers is the attached Notice.

Respectfully submitted,

Les Evans for Councilmember McTaggart

City Manager