City files opposition to EPCOR request

February 16, 2019

BULLHEAD CITY — The dispute over EPCOR Water Arizona’s proposal to substantially raise local water rates continues next week when members of the Arizona Corporation Commission will hear from the public this week regarding the matter.

Public comment provided on Tuesday, beginning at 10 a.m. in Phoenix, will be taken into account by the ACC when it decides whether to accept EPCOR’s application for interim rates.

The ACC also is scheduled to hear about the matter Wednesday and Thursday mornings as well but won’t accept public comment at those times.

EPCOR opposes the ACC decision made last month to reject its consolidation and rate restructuring proposal.

The City of Bullhead City’s opposition to EPCOR’s interim rate request is spelled out in its filing to the ACC.

The city’s view is that interim rate relief is only appropriate when “either there is an ongoing delay in deciding a rate case or there is an emergency,” according to the filing.

The response contended that EPCOR hasn’t demonstrated either condition. A company’s situation is considered an emergency when it has suffered sudden hardship, insolvency or is unable to maintain service. And the ACC rendered its decision within the allotted amount of time during an agreed-upon time extension.

Bullhead City’s opposition also noted that EPCOR opted not to have the rates implemented by rejecting “reasonable” compromises offered by ACC members last month. The city argues that EPCOR’s decision shouldn’t “result in additional legal expenses to customers, which would necessarily occur if another full rate case must be litigated.”

Bullhead City intervened in the EPCOR’s rate case in May 2018, which proposed consolidation of its 11 water districts across the state. The city is within two of the districts: Mohave and North Mohave. Two other districts are in Mohave County.

EPCOR’s plan would result in residents seeing water bills increase by at least 30 percent — substantially more than required to cover EPCOR’s expenses incurred fulfilling the water needs of Bullhead City, local officials have said.

One of the city’s filings to the ACC noted that the local household income is about $37,000 a year and that roughly 20 percent of residents live below the poverty line.

This is why local officials assert that city’s population of about 40,000 people shouldn’t be asked to pay a rate increase that it contends subsidizes districts where the delivery systems are more expensive to operate — especially if the customers in those districts are wealthier.

Bullhead City Mayor Tom Brady and City Manager Toby Cotter are among those who refer to EPCOR’s plan as statewide rate “socialization.” Both urged residents to make their feelings known about EPCOR’s rate proposal at the Feb. 5 Bullhead City Council meeting.

The city considered placing a proposition on the November 2018 ballot that would have asked for voter authorization to take steps to acquire or condemn EPCOR’s local water system and take control of it. That proposition was withdrawn but city officials insist it could be revived.

Bullhead City also proposed consolidating Mohave, North Mohave, Havasu and Willow Valley systems — EPCOR’s four Mohave County components — into one district. That proposal has never been considered officially by EPCOR or the ACC.

The current average monthly water rate in Bullhead City is $27. Under Bullhead City’s proposed consolidation plan the average bill would be $36. EPCOR’s rate plan submitted to the ACC would place that average bill at around $45 a month.

Bullhead City officials said they aren’t opposed to leaving the rate structure alone, either: Not consolidating any of the districts still would result in Bullhead City’s average rate going up to about $35 a month, according to past reporting.

Bullhead City also asserted the test period used to determine new rates allows for too many extra expenditures not directly linked to system operations.

“Here, the number of adjustments boggles the mind,” Steve Wene, the attorney representing Bullhead City, wrote in a motion filed in mid-January of this year.

Those not attending Tuesday can watch the meeting electronically by going to https://azcc.gov/livebroadcast.asp. Look for the meeting on a list and use the accompanying link to access the livestream.

ACC members are supposed to make a decision within 60 days of EPCOR’s filing done on Jan. 31. An administrative law judge will provide board members with an evaluation of the information presented to help them make a decision, said Holly Ward, the ACC’s communications director.

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