Suburban Water Systems
2015 General Rate Case
Suburban serves about 76,000 water customers in
the San Jose Hills and Whittier/La Mirada service areas. On February 24,
2014, Suburban Water Company filed a general rate case Application with the CPUC, proposing to increase its customer rates for 2015 – 2017:
- 2015: $8.93 million (or 13.37%) increase
- 2016: $3.21 million (4.32%) increase
- 2017: $2.72 million (3.51%) increase
- Total: Cumulative $14.86 million increase over 3 years
Suburban's initial proposal would have increased
monthly bills for an average residential customer by $10.28 for San Jose Hills
and $7.41 for Whittier/La Mirada.
A Public Participation Hearing was held on July
16, 2014 in West Covina.
On September 10, 2014, ORA and Suburban filed a proposed Settlement Agreement
which would adjust customer rates for 2015 – 2017:
- 2015: $6.75 million (or 9.84%) increase
- 2016: $2.32 million (3.07%) increase
- 2017: $2.09 million (2.68%) increase
- Total: Cumulative = $11.16 million increase over 3 years
The proposed Settlement would increase an average
residential customer’s bill by $7.52 for San Jose Hills and $5.47 for
Whittier/La Mirada in 2015. If approved by the CPUC, the Settlement would
resolve all but one disputed issue related to Suburban’s recovery of
The proposed Settlement is pending before the CPUC.
ORA’s Policy Position
ORA’s analysis shows that Suburban
over-estimated its revenue needs by 45% in the areas of operations and
administrative expenses, infrastructure, and forecast of water sales. ORA
supports the Settlement because it fairly reduces Suburban’s original
requested rate increase, but still allows Suburban to continue to provide safe
and clean water service in an efficient and cost-effective manner. The CPUC’s
adoption of the Settlement would reduce Suburban’s revenue requirement
increase by nearly $2.2 million, or 24.4%, compared to Suburban’s original
request of $8.9 million for 2015.
The remaining unresolved issues are related to
the recovery of regulatory expenses, which will have policy implications for all
other Class A Water Companies. ORA advocates that the CPUC should:
- Shift Suburban from amortized recovery of general rate case expenses to
recovery of forecasted expenses for a future general rate case.
- Not allow Suburban to recover double the amount of regulatory expenses for
the current general rate case cycle.
If a shift from amortized recovery of general
rate case expenses to recovery of forecasted expenses for a future year is
authorized, the CPUC should:
- Not allow recovery of double the amount of regulatory expenses for the
2015 General Rate Case cycle.
- Allow recovery of the catch-up allowance over no less than six years.
See ORA's June 23, 2014 amended Testimony.
See ORA’s March 28, 2014 Protest.
See the Proceeding docket.
Suburban General Rate Case Archive