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Wastewater districts under debate

Elizabeth Medora~ 7/31/2014

ANTHEM – The Arizona Corporation Commission has directed EPCOR Water to examine options for changing wastewater districts in response to concerns raised repeatedly by Agua Fria district customers.

Anthem originally was part of the Agua Fria wastewater district. Due to rising rates, Anthem customers requested and received deconsolidation in 2012 and are a separate EPCOR wastewater district. Now, that ruling may be overturned, due to the Corporation Commission’s directive to reexamine wastewater charges.

In the Corporation Commission’s July 22 meeting, EPCOR customers from all over the valley presented their feelings on the wastewater redistricting. Residents of the Corte Bella, Russell Ranch, and Verrado communities expressed desires to deconsolidate and further break down the Agua Fria district. Anthem residents expressed desires not to reconsolidate with the Agua Fria district. See video of the open meeting on the Commission’s Web site, www.azcc.gov, under the Live Broadcasts/Archives tab.

Three wastewater-districting options are currently being considered:

  1. Full consolidation of all EPCOR wastewater districts, including Anthem, Agua Fria, Bullhead City (Mohave), Sun City, and Sun City West.
  2. Full deconsolidation of the Agua Fria district, further separating the Agua Fria district into smaller districts.
  3. Reconsolidation of the Anthem and Agua Fria districts.

 

EPCOR must present a detailed report and financial breakdown for each of the three options to the Commission by Friday, Aug. 8. Ultimately, the decision of which option is best is up to the Arizona Corporation Commission.

“This is not a vote to change rates,” noted Rebecca Stenholm, EPCOR Director, Public & Government Affairs.

Stenholm emphasized that EPCOR has no financial stake in the outcome of the redistricting, referring to it as a “revenue neutral exercise.”

Since Agua Fria customers have been unhappy with their wastewater rates, to the point of petitioning the Corporation Commission to require EPCOR to reexamine rates, EPCOR is looking for a way to improve the situation.

“We’re pleased to work with the Commission, and we will move quickly to respond and provide an answer by Aug. 8,” said Stenholm. “We think it’s a good idea to review.”

The Anthem Community Council has registered their opposition to reconsolidation of the Anthem and Agua Fria districts, calling a reversal of the 2012 deconsolidation “an unfair subsidy” from Anthem to Agua Fria.

Council Community Executive Officer Jenna Kollings spoke at the July 22 meeting, appealing to the Corporation Commission not to overturn the 2012 deconsolidation decision.

“Anthem EPCOR customers pay for their costs for wastewater,” Kollings said. “Please maintain what is just and fair by expressly prohibiting reconsideration of deconsolidation.”

Commissioner Brenda Burns noted that the July 22 meeting was intended to examine options, not resolve the rate issues that day.

“We need to look at everything,” Burns said.

Commissioner Gary Pierce said that he could “fully appreciate the position Anthem is in.”

“The commission has to figure this out in a new direction,” Pierce added. “We have to try to pull this together and be reasonable to all the parties. We really did make a deal with Anthem, and we have to figure out how to honor that and pull this together.”

In their vote, the Corporation Commission did allow reconsolidation as an option. However, they are open to public commentary on whether reconsolidation is a good or bad option.

“The Commission will continue to accept any written comments, as well as phone calls,” said Rebecca Wilder of the Corporation Commission. She noted that written comments are placed in the case docket and become part of the record. Public comments are also accepted at open meetings. Email the Commission at mailmaster@azcc.gov.

While the Anthem Community Council is frustrated that reconsolidation is being considered as an option, they are not giving up on quashing reconsolidation.

“While we support investigation of rate relief options for Agua Fria wastewater customers, this option should not be considered, and is not being requested by Agua Fria ratepayers,” said Council Community Executive Officer Kollings.

“On behalf of Anthem residents, the Anthem Community Council vigorously opposes any effort by the Arizona Corporation Commission to reconsolidate the Anthem/Agua Fria Wastewater District. No facts have changed and no new facts have come to light since that time; thus, reconsolidation is not the solution now,” Kollings emphasized.

Should the Corporation Commission choose order reconsolidation of the districts, the Council will still attempt to find a way to uphold the 2012 deconsolidation.

“The Anthem Community Council is researching and considering strategies and options for arguing in favor of maintaining the integrity of the Corporation Commission’s 2012 decision,” Kollings said.  

Each option presented has pros and cons. The breakdown of each option will be clearer after EPCOR presents its report to the Commission. This report will be available in the case docket on www.azcc.gov.

Further deconsolidation of the Agua Fria district likely would not affect Anthem’s wastewater rates; reconsolidation is likely to increase them. Full consolidation of the wastewater districts needs to be further explored to determine the affect on Anthem rates.

“We do not yet know what the impact of statewide consolidation of all EPCOR wastewater districts and systems would be on Anthem residents,” said Kollings.
“In a prior phase of the proceedings, Anthem favored total consolidation for the following reasons: lower administrative costs through unified customer accounting and billing systems; reduction in rate cases and associated expenses; elimination of distorted cost allocations among districts in rate filings; the implementation of standard customer service policies and related service rates and charges; improved rate stability and elimination of rate shock; reduced customer confusion regarding differing rate schedules; the development and implementation of a targeted and comprehensive water conservation program for all of its systems. We sense that full system-wide consolidation would achieve the above.”

EPCOR director Stenholm outlined how the water company views the options.

“Reconsolidation doesn’t really solve the problem,” she noted. “It puts us back where we were.” She added that further deconsolidation of the Agua Fria districts could cause rates to go higher for some of those customers.

Like the Anthem Community Council, Stenholm noted that full consolidation was “probably the best option,” but that EPCOR wouldn’t know the full impact to ratepayers until they have finished their financial analysis for the Corporation Commission.

The breakdown of these options will be available Aug. 8. The meeting date for the Commission to vote on the options has not yet been set. To submit feedback to the Arizona Corporation Commission, email mailmaster@azcc.gov or call (602) 542-3026.