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Tariff Unit, Water Division, 3rd floor
Public Utilities Commission
505 Van Ness Avenue
San Francisco CA 94102
Email: , , ,
cc: , ,
, ,
This email refers to the acronyms SJWC, and SCVWD
SJWC = San Jose Water Company
SCVWD= Santa Clara Valley Water District, the water agency
SUBJECT: Proposed Resolution W- 5150
Dear PUC President Picker and Commissioners,
I am writing to convey my support of the Water Division’s proposal to CPUC affirming rejection of San Jose Water Company's 3.65% water rate increase Letter 501.
I thank the CPUC Commissioners and the PUC Water Division Team for their work!
THANK YOU TO CPUC COMMISSIONERS, STAFF AND ORA
We appreciate your diligence in taking a measured and tough stand against a greedy and shameless corporation called San Jose Water Company.
Thank you for your rejection of AL 501 on May 3rd. Please stand by it and support the citizens. I thank you for rejecting Letter 510 and initiating the audit and investigation of San Jose Water Company. We appreciate you pushing back on the rampant rate increases of San Jose Water Company that we have been dealing with. We are NOT happy that San Jose Water Company has had a windfall $51M profit last year (up from $21M in 2012) – while we citizens have no choice, but to keep paying more and more to SJWC thanks to the super high water bills. ENOUGH IS ENOUGH!
You are all doing an amazing job, standing up for us citizens!
Your staff and ORA are collectively doing an impressive job so far and we commend you for it!
We are a choiceless consumer but not voiceless consumer. Please stand by us, the people, and reject the appeal by SJWC against the denial of their letter 501 rate increase. SJWC provides water services to ~229,000 water meter connections that serve 80% of citizens of San Jose, some of Cupertino and all ofSaratoga, Campbell, Monte Sereno, Los Gatos, andunincorporated Santa Clara county – and I strongly believe that citizens from every city are outraged at the gouging that we have experienced by San Jose Water Company
FURTHER CALL TO ACTION AND SUMMARY OF OUR REQUEST
We urge CPUC to continue to be consumer advocate and consider implementing the following:
1. CONDUCT A THOROUGH INVESTIGATION AND AUDIT:We are glad that CPUC initiated a thorough investigation and audit of SJWC's past and present billing practices Please penalize SJWC for any wrong doings and public reprimand any wrong practices currently in place.
2. CREDIT SURCHARGE We hope you will determine that SJWC owes its customers a lot more than $1,794,439 (it has proposed giving back with AL No. 510 and which was rejected).
3. NO FURTHER RATE INCREASE IN 2017:We have already approved 12.3% rate increase so far in 2017. SJWC's greed won't end here. Please don't approve any more rate increases in 2017. CPUC has already approved Letters 498, 506, 508, 509 == 12.3%. This is 12.3% more than what we anticipated for 2017, given the consumer gouging that occurred in 2016
4. THOROUGH SCRUTINY OF COST OF CAPITAL & GENERAL RATE INCREASES BEFORE ANY RATE INCREASES ARE GRANTED:Please consider comparison metrics for all other public &private utilities in the bay area in determining the appropriate cost of capital adjustments and rate increases for future years. Please make sure that we have comparable rates and/or implement policies so our rates get normalized over the coming years. There is plenty of evidence in APPENDIX A through G below, that our rates have gone up astronomically in the last few years.
5. THOROUGH SCRUTINY OF EVERYTHING SJWC SUBMITS AND HAS SUBMITTED IN THE PAST:As part of the audit, please evaluate all the filings by SJWC currently in place. Table 1 and 2 below shows a summary view of the exploitation that has been conducted surgically and methodically by San Jose Water Company these last few years. SJWC has stacked the system to suit it’s greed and it is time, we pull the plug on that. As you read through this email, please make a mental note that some San Jose Water customers have seen their 2016 water bill to be in the $2,500 to $4,000 range, in spite of reducing their water consumption by ~50%. Simply stated, San Jose Water Company has been blatantly gouging their customers in the name of drought and increased their profits.
6. DENY A.17 04-001 RATE OF RETURN ON EQUITY (ROE): 9.65% As per A.17 04-001 CPUC has set a ROE of 9.43% . The allowed rate of return needs to be significantly adjusted down given the bounty SJWC has experienced in the last few years. In particular, see table 1 above. Their income was $22M in 2012 and last year was a whopping $51M. It is NOT acceptable for our rate increased to be raised by so many percentage points every few months – while SJWC keeps increasing it’s profits as a result. NOT JUSTIFIED!
I AM VERY UPSET – I FEEL I HAVE BEEN EXPLOITED BY SJWC
SJWC has increased revenue in the period of 2010 to 2016 by 66% and in the same time their income has gone up by 200% - as per Table 1 below They continue to increase rates every year. The customer base is a constant – why are we seeing such huge increases?
Please note that if CPUC approves all the SJWC filings so far for 2017, San Jose Water Company would have raised my rates a whopping 15.9% as per Table 2 below. Given that this is not only 6 months into the year, I do not want a 15.9% water rate increase in the first 6 months of 2017. I am keenly waiting how far SJWC will take this – 30%, 36% or is it 50%? I just can’t wait to find out….how much extra cash I will be forced to hand over to SJWC every month.
Seriously, we are being exploited and I am afraid this is only the beginning now that SJWC has experienced the bounty from 2016
TABLE 1: HOW HAS SJWC DONE FINANCIALLY?
2016 / 2015 / 2014 / 2013 / 2012 / 2011 / 2010Population served / 1.092M / 1.089M / 1.085M / 1.077M / 1.07M
Op. Revenue / $339M / $305M / $319M / $276M / $261M / $222M / $203M
Income (before Tax) / $86M / $61M / $76M / $36M / $37M / $36M / $30M
Net Income (after Tax) / $52M / $37M / $51M / $22M / $22M / $21M / $17M
Income % Y2Y / 40% ↑ / 28% ↓ / 130% ↑ / 0% / 0% / 23% ↑ / -
Revenue increase (2010 to 2016): 66% INCREASE
Income increase (2010 to 2016): 200% INCREASE
TOTAL POTENTIAL RATE INCREASES FOR 2017 (so far)
(Rate increase submissions by SJWC January through June 2017): 15.9%
SJWC / Filing Date / Percentage Increase / Result
As per A.17 04-001 CPUC has set a ROE of 9.43% . The allowed rate of return needs to be significantly adjusted down given the huge bounty SJWC experienced in a drought
510 / June 6, 2017 / Surcredit filing / REJECTED – Investigation and audit being conducted
501 / January 9, 2017 / 3.65% / Rejected by CPUC
click here. SJWC has subsequently filed an appeal
509 / May 26, 2017 / 3.66% / Approved by CPUC, click ->
508/508A/508B / May 2nd ,
May 26th ,
June 1st, 2017 / 3.30% / Approved by CPUC
- Click here
506 / Feb 17, 2017 / 1.51% / Approved by CPUC
Surcharge removal / Feb 1st 2017 / Crazy % ↓
Thanks CPUC / CPUC removes surcharge
498 / 11/15/16
(Eff. 1/1/17) / 3.83% / Approved by CPUC
Surcharge / June 2015 / Crazy % ↑ / Approved by CPUC
CPUC Status – click here || List of SJWC Filings – here || Annual Report - here
WE NEED COMPARISON METRICS – we have had enough of SJWC’s effort to blatantly increase profits
If CPUC approves anything from SJWC, please provide us as part of the disposition, a study of Bay Area public and private water utility companies:
· What has been the % increase in water rates year to year since 2007 – obviously includes specific data San Jose Water company.
· In particular, what is the percentage increase these utility companies are planning in 2017, given that SJWC is currently filed to increase rates 15.9% and this is not even 6 months
WE WANT MORE THAN “PUBLIC RELATION PITTANCE” aka Letter 510
The total amount of the refund is $1,794,439
Just $1.794,439? That is ridiculous!!! We call it PR Pittance
· I am appalled that SJWC still seeks to increase our rates, and the surcharge given the financial windfall for SJWC in 2016 on the backs of a severe drought, and the people of our community who went through a lot of personal stress due to super high water bills.
· Here is a petition asking Santa Clara County to take action, condemn San Jose Water Company http://tinyurl.com/CondemnedSJWC
We demand more of our cash back
Per the annual statement of SJWC, SJWC increased their profits 40% from 2015 to 2016. Their Q3 2016 income was $19M in comparison to Q3 2015 of $9.5M. The numbers tell us that there is a huge cash surplus.
The huge income and revenue in 2016 is the reason why SJWC was reluctant to remove the drought surcharge (Refer to CASE STUDY A: SCVWD Jan 24th 2017 SCVWD board meeting in Appendix). The customers of SJWC then began emailing the SCVWD Board requesting a removal of the mandate, and specifically asking for a SCVWD Board resolution that denounced any surcharge by SJWC and referring to the dissonance between Great Oaks and SJWC on the surcharge. We were relieved that SJWC decided to remove the surcharge via a filing with CPUC.
We the customers of SJWC, ask that SJWC refund the delta increase, the “drought bumper bonanza” that they have raked in, in the guise of a “very dire drought”. The customers of SJWC are definitely entitled to a refund much more than $1.7M not this “PR Pittance”. I do understand that SJWC is in the need for a serious PR makeover, but this is not even a start!
Here are case studies attached in the Appendix that I suggest you read through
· CASE STUDY B: SANJOSE WATER 2X compared to GREAT OAKS
· CASE STUDY C: SANJOSE WATER 5.5x compared to Coachella Valley Water District
· CASE STUDY D: SAN JOSE WATER RATES DOUBLED in 3 YEARS
· CASE STUDY E: COMPARE THE PRICE OF WATER SJWC vs LAS VEGAS
· CASE STUDY F: SJWC 350% increase since 2010
· CASE STUFY G: SAMPLE CASE STUDY JUNIPERO WAY, SARATOGA CA:
PLEASE REJECT A.17.04-011
Application A.17.04-001 SJWC is requesting an increase in authorized Cost of Capital from the Jan 1, 2018 to December 31, 2020.
Scroll down below for the graph and use case of how much our water rates have gone up. How many rate increases will we continue to see?
1 – SJWC believes Application A.17.04-001 is necessary for it to attract capital to fund water system investments that allow the company to meet its obligations to safety and reliably serve its customers
MY RESPONSE: The annual increases in San Jose Water Company rates from 2013 to 2016 averaged 20%, and San Jose Water Company customers cannot sustain such high rate increases year after year. The year-to-year income growth from 2015 to 2016 was 40% - on the backs of a severe California drought and over-charging their customers in the name of the drought. Why do they need more money now? Haven’t they done well financially already? Where is the financial windfall being put to use? Not in capital improvement projects? I am surprised! I am angry too!
Please refer to section below in this letter CASE STUDY F: SJWC 350% increase since 2010
2 – SJWC’s proposal Application A.17.04-001 will assist it in maintaining an investment-grade rating thereby reducing the overall financing costs and contribute to SJWC’s ability to provide safe, high quality, and reliable water service at reasonable rates
MY RESPONSE: SJWC’s 2015-Q3 to 2016-Q3 income went up from $9.5M to $19M. This has caused lots of angst within our community. Isn’t SJWC planning to use this extra cash for maintaining and investment?
The graph in the appendix under section CASE STUDY F: SJWC 350% increase since 2010 demonstrates how a home owner reduced consumption by 30-50% over the past 7 years HOWEVER SJWC rate has increased 350% in the same time period. This is not justified, nor fair and I ask CPUC to step up and stop this blatant gouging of the consumer
WHY DID THE CEO OF SJWC GET A $3M BONUS?
Lastly but not least, the payment of a $3,000,000 bonus to the CEO of San Jose Water is an insult to the users and payers of San Jose water who were compelled to pay huge increases in their water bills and at the same time reduce their water consumption. It is just not fair. We the citizens, customers of SJWC, are unfairly footing the bill for the excesses.
I respectfully request that the PUC follow through on the FURTHER CALL TO ACTION AND SUMMARY OF OUR REQUEST from above and protect us, the citizens of California from the blatant gouging by San Jose Waer Company
Sincerely,
- Your name
- Address
ADDENDUM
Please also review addendum information below
CASE STUDY A: SCVWD Jan 24th 2017 SCVWD board meeting