Our View: Rate hikes poor way to launch water agency

Our View

With little fanfare, California Gov. Jerry Brown last weekend changed the course of Santa Clarita Valley water history by signing Senate Bill 634, creating a single valleywide water district with an elected board to represent a unified voice on valley water policy.

Effective Jan. 1, 2018, gone will be a two-layer water district system with a water wholesaler to import Northern California water and three main water retailers to distribute both state water and domestic groundwater to homes and businesses.

At the initiative of wholesaler Castaic Lake Water Agency and retailer Newhall County Water District, and on the approval of the state Legislature and Brown, the four will become one.

Most members of the two elected boards that engineered the merger have long touted its benefits: economies of scale, less need for outside consultants, less money spent going back and forth with each other in court, and more unified efforts on issues like water resource management and recycling.

Greater efficiency was promised; no promises of reduced customer rates were made, but supporters did say costs would go down, and that increased rates would likely be less frequent and/or less drastic.

So why, customers might ask, in the waning days of Santa Clarita Water Division and Valencia Water Company – the two retailers either owned by or whose stock is controlled by Castaic Lake Water Agency – are their rates due to go up as high as 16 percent in 2018?

Valencia Water customers just saw a rate increase last year.

And, to add insult to injury, a repair bill for the State Water Project will drive up residents’ costs another $20 a month for 10 years.

Naysayers who opposed the valleywide water district and brought some strong arguments against it are already pointing to the two pending retail rate hikes and forecasting a future of continued such hikes.

We believe the water engineers should rethink steep rate increases planned before the new water agency is even established. Though not much was promised in terms of benefits for ratepayers, much was intimated and much suggested in terms of benefits.

Steep rate hikes is not the way to launch the Santa Clarita Valley Water Agency. In the process of getting the agency together, let’s have its retailers review their rates and consider reducing those proposed.


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