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Hillview Water requests 46% rate increase

A public meeting will be held at 6:30 p.m., Sept. 3, at the Yosemite High School cafeteria to explain the details of a 46.3% proposed rate increase requested by Hillview Water Company - an increase that would increase company annual revenues by $653,296.

California Public Utilities Commission (CPUC) Regulatory Analyst Moises Chavez will conduct the meeting, and will explain how the commission will analyze the proposed rates and fees increase. The meeting will also allow Hillview customers the opportunity to ask questions and express their views.

Hillview representatives will be at the meeting to explain reasons for the proposed rate increase. California law requires Hillview to show to the CPUC’s satisfaction that an increase is justified before it may raise its rates.

A legal notice in the Aug. 13 issue of the Sierra Star said the increase is necessary to off-set increased operating expenses since the last increase in 2009.

The meeting notice states Hillview recently constructed water treatment plants that were funded with government grants at no cost to water customers ... However the significant costs, including four additional employees, to operate these plants will be paid by Hillview. These operational costs along with greater costs of compliance with regulations have resulted in an overall rise in the company’s operational costs.

The proposed rate increase would affect about 1,470 customers in Oakhurst, Sierra Lakes, Goldside, Hillview, Coarsegold, and Raymond.

If approved, the proposed monthly rate increases to customers would be as follows:

3/4 inch meter: $32.23 to $49.70. The majority of single family homes connected to Hillview are on 3/4 inch meters (more than 1,300 service connections).

1 inch meter: $51.74 to $82.83 (68 connections).

1 1/2 inch meter: $100.51 to $165.65 (35 connections).

2 inch meter: $159.04 to $265.04 (35 connections).

3 inch meter: $295.61 to $496.95 (seven connections).

Rate increases are also being proposed for private fire protection service, private fire hydrant service, and metered service for trucks, which is not included in the 1,470 connections listed above.

Chavez explained that the CPUC sets water utility rates using a cost-of-service ratemaking method which is intended to allow water utilities to: 1) recover in rates operating and capital expenses necessary to provide safe and reliable water service; and 2) earn a rate of return on utility investments within the commission’s recommended range of rate of returns for water companies the size of Hillview.

Chavez said the CPUC staff will be looking at three primary things when evaluating the rate increase.

“Commission staff will be conducting a thorough investigation of Hillview’s rate increase request which will include evaluating the company’s operations and expenses associated with those operations since the company’s last General Rate Case in 2009 ... reviewing each company’s expense accounts and only those expenses that are deemed reasonable will be allowed in rates ... and reviewing and evaluating the capital improvements/utility investments since the company’s last rate increase along with expenditures associated with those improvements to determine whether improvements were needed and in operation.”

The CPUC staff will make a thorough investigation of Hillview’s request, and will have the options of granting the request in whole, or in part, or deny it.

Following the commission staff’s investigation a draft resolution will be prepared with staff’s findings and recommendations for the commission’s consideration. The draft Resolution will be issued for 30-day public comment period before the commission considers Resolution for approval. Under the current time line, it is anticipated the draft Resolution will be issued for public comment in October and the commission will announce its decision in November.

Chaves explained that there are a number of factors that can impact the price people pay for water.

“Factors such as water scarcity, created by drought or other environmental factors, high cost of treating the water if the source of supply requires extensive treatment, and cost of infrastructure necessary for reliable and safe delivery of the water,” Chavez said. “The cost of water for small water utilities with small number of service connections, such as Hillview Water Co., can be high because the operational/capital expenditures are allocated over a smaller number of customers.”

Dan Rule, president of the Oakhurst Area Chamber of Commerce, said any rate increase will impact the business community, in some cases significantly, with a potential trickledown effect on product price, business expansion, and job creation and retention.

Sept. 2 deadline for letters of protest

A letter to Hillview customers, who would be affected by the rate increase, were mailed by the company on Aug. 13. Customers have till Sept. 2 to write a letter of protest or other response to both the CPUC and Hillview concerning the proposed rate increases.

Protest letters must state the facts constituting the grounds for the protest.

The mailing and Email addresses are: CPUC, Division of Water and Audits, 505 Van Ness Ave., San Francisco, Calif., 94102, fax (415) 703-2481 - Email, water_division@cpuc.ca.gov. Hillview Water Co., P.O. Box 2269, Oakhurst, Calif., 93644 - Email, h2o@sti.net.

A copy of the rate increase request may be seen at the Oakhurst Branch Library, 49044 Civic Circle, and a copy of the rate increase request can be mailed to those interested for a fee by calling Hillview at (559) 683-4322.

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