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Apple Valley Ranchos Water Company Should Receive Only Half the Rate Increase It is Requesting

SAN FRANCISCO, May 13, 2014 – The Office of Ratepayer Advocates (ORA), the independent consumer advocate within the California Public Utilities Commission (CPUC), has issued its detailed analysis on Apple Valley Ranchos Water Company’s (AVR) request to increase its customers’ water rates by a total of $7.4 million from 2015-2017. This is twice what ORA finds is necessary. 

In January 2014, AVR requested the CPUC approve a rate increase of nearly 15% beginning in 2015, with additional increases of 8.2% to 8.5% in the following years. AVR serves approximately 24,000  water service connections in the city of Apple Valley. AVR’s request would increase water bills for an average residential customer by about $18 every two months. Current water bills are about $130 every two months for the average residential customer. 

ORA’s analysis concluded that customer rates should increase by a lesser amount of about 8% beginning in January 2015, followed by increases of about 3% for 2016 and 2017. ORA’s review of AVR’s filing finds that the company has overestimated the amount of revenues it needs to operate its system safely and reliably. ORA recommends that the CPUC approve less cost increases in the areas of operations and administrative expenses, infrastructure, and forecast of water sales. ORA’s recommendation would increase water bills for an average residential customer by $9.27 every two months. 

“Apple Valley Ranchos Water has asked for twice what it needs in rate increases to serve its customers safely and reliably,” said Joe Como, ORA’s acting director. “We recommend that the CPUC approve ORA’s recommendations, which provide AVR with what it needs to operate, and doesn’t place an unnecessary rate burden on Apple Valley water customers.” 

The five-commissioner CPUC panel is expected to rule on AVR’s requests by the end of the year after it has held evidentiary hearings at the CPUC before an Administrative Law Judge, scheduled for June 16 – 20, 2014. Public Participation Hearings were held in the Apple Valley community on April 30, 2014. 

For more details, please see ORA’s webpage on Apple Valley Ranchos.   

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