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Cal-Am Water Watch

RECENT UPDATE: Public Citizen files a protest
to the Monterey General Rate Case

On April 4, 2005 Public Citizen filed a protest to the Monterey General Rate Case, which requests that ratepayers start footing the bill for a large desalination plant proposed by California American Water Company (Cal-Am). The proceeding got off to a great start when the Administrative Law Judge ordered Cal-Am to do an independent audit of their application due to the court's frustration at the "chronic errors" in Cal-Am's documents.

At public hearings on May 12 and 13, Monterey Peninsula residents objected to paying in advance for the desalination plant and many were in support of a public take-over of the local water system. In Felton, ratepayers strongly opposed Cal-Am’s requested rate increases (which would amount to more than 105% over the next three years), the proposed consolidation with Monterey, and complained about poor service and unprofessional and drawn-out maintenance jobs.  Felton FLOW members asked the Administrative Law Judge to hold off making any decisions regarding the pending consolidation and rate cases so the Felton residents can vote on a bond to purchase their water system from Cal-Am. 

Parties to the Monterey and Felton rate cases will prepare testimony before the Administrative Law Judge on June 30, 2005.  For more information on the history of the proceeding and a list of the participants, please visit the CPUC website: http://www.cpuc.ca.gov/proceedings/A0502012.htm. Copies of Cal-Am’s rate application and other documents can be requested from the Centrals Files Office at the CPUC: http://www.cpuc.ca.gov/static/forms/central+files+request+form.htm.

To view the complete text of Public Citizen's protest, click here.

Stop the Corporate Takeover of Water:
How Cal-Am is Cashing in on California's Blue Gold

In early January 2003, the third largest water company in the world -- British-run and German-owned RWE-Thames Water -- gobbled up American Water Works (known as California-American or, Cal-Am, in  California). This global conglomerate generated approximately $53.5 billion in external revenues in 2003 and operates in over 120 countries.  RWE-Thames promised "immediate benefits" from the American Water Works takeover, but instead ratepayers are grappling with large rate increases and declining service. 

Cal-Am/RWE-Thames Water delivers water in over a dozen regions in California, including the suburbs of Sacramento, Monterey, Felton and the City of Thousand Oaks.  Thames Water also has a 20-year, $600 million contract to operate the water and wastewater utilities in Stockton, which went into effect in August 2003. Two years later, the contract is being disputed in court because the City did not comply with the requirements of the California Environmental Quality Act (CEQA). In January 2005, Attorney General Bill Lockyear filed an amicus brief in support of the residents of Stockton, which stated that CEQA requires a full-analysis and disclosure of the environmental impacts of OMI-Thames Water’s projects before the City of Stockton “commits the public, the public’s money, and our shared environment, to it.”

Many other California communities are fighting for greater public control of their water:

  • After suffering for years from poor service and neglect, the small town of Montara, along the San Mateo Coast, purchased their water system from Cal-Am/RWE-Thames in May 2003.  A local, voter-elected board now runs the utility and is able to use municipal financing, the cheapest available, to improve the infrastructure.
  • The community of Felton is also organizing to acquire their water system and put it in public hands.  Members of Felton FLOW -- Friends of Locally Owned Water –- have been instrumental in this effort by successfully setting up a Mello-Roos district, organizing town meetings and fundraising events, and testifying in front of the California Public Utilities Commission (CPUC) on behalf of their community. This July, residents will be voting on a bond to purchase the water system from Cal-Am, after which they hope to merge with the neighboring San Lorenzo Valley Water District. Felton FLOW needs at least a 67 percent “YES vote for passage of the bond. Cal-Am, however, is unwilling to sell the utility and is trying to undermine the community’s efforts while pushing to raise rates.  They have spent millions of dollars on legal fees and mailings with misleading and inaccurate information. And if keeping ahead of Cal-Am is not enough work, now Felton FLOW is defending itself against a local dissenter who sued the group over the wording of the voter pamphlet. While FLOW has acquired legal assistance, they are in need of financial donations to pay for lawyer fees.  For more information, please contact Felton FLOW at (831)335-3053 or feltonflow@aol.com or mail legal defense fund donations to: PO Box 38, Felton, CA 95018.    
  • In 2004 Cal-Am requested a rate decrease in the City of Thousand Oaks, likely in response to the strong opposition they have faced in Felton and other districts. Thousand Oaks, however, protested Cal-Am’s proposal at the PUC, claiming the rate decrease requested by Cal-Am was insufficient, and that Cal-Am has not proven that the RWE-Thames merger has generated savings and benefits for ratepayers. On December 16, 2004 the PUC authorized a rate decrease of 6.36% for Thousand Oaks which took affect in January. Smaller rate decreases were approved for 2006 and 2007.
  • At the same PUC meeting on December 16, 2004, several residents from the small Salinas Valley community of Chualar testified before the PUC about their exorbitant water bills. Without prior notification, Cal-Am had increased their water bills up to 1500%, from $21.60 per month to over $200 per month in some cases. In a victory for the residents of Chualar, after the PUC meeting, Cal-Am agreed to freeze rates at the original amount until the company prepares a fee scale more appropriate to the town's residents, most of whom are farm workers.
  • Cal-Am/RWE-Thames is aggressively trying to expand its water business and is planning to build a large ocean water desalination plant on the  Monterey Coast, at the mouth of the nationally protected Elkhorn Slough.  Desalination projects are expensive, energy intensive and can have significant adverse impacts on aquatic ecosystems. The new water supplies created by removing salt from ocean water can also promote unsustainable development in fragile coastal areas. 

To find out more about the organizing in each of these communities, contact Public Citizen at 510-663-0888 or e-mail.

    » california | water | calam


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