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Judge Denies Motion To Dismiss SCOPE Complaint On Water Agency

An administrative law judge denied a motion Monday by the Valencia Water Co. to dismiss a ruling regarding a water-agency purchase, but he granted another 14 days to allow the company to respond to his last decision.

The Valencia Water Co. asked the Public Utilities Commission to disregard its ruling on a recent complaint filed by several local environmental groups, in documents filed Tuesday.


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"We're now considering the various options we have available to us," said Dan Masnada, general manager for the Castaic Lake Water Agency.

In his ruling Monday, Administrative Law Judge Douglas Long merely denied a motion by Valencia Water Co., which asked the judge to disregard his initial ruling on jursidictional grounds. 

The environmental groups, including SCOPE and Friends of the Santa Clara River, took issue with CLWA's purchase of VWC in December.

"We are pleased that the CPUC is taking this matter seriously and will hear the complaint," said Lynne Plambeck, president of SCOPE, which is one of the groups in the complaint. "We continue to believe that the purchase agreement made by CLWA to acquire the Valencia Water Company is not in the best interests of the residents and other water users in the Santa Clarita Valley."

Long issued the following statement Monday:

Valencia Water Company (Valencia) is the jurisdictional utility and it is responsible for timely applications to the Commission to inform or seek approval of various transactions.  Castaic Lake Water Agency (Agency) as the apparent new or proposed owner of Valencia is certainly able to join Valencia in the filing.  Applicants may make any and all necessary factual disclosures (with appropriate sworn testimony) and legal arguments for whatever relief is sought, including a proposed finding that the transfer is reasonable and no authorization is necessary.  However, to date, neither Valencia or Agency have ever properly informed the Commission of the proposed or actual transfer nor sought Commission concurrence or approval.  This filing is due within 14 days of this ruling.

The buy would give the CLWA, which is a public agency and a wholesaler of state water, control over approximately 84 percent of the local retail water market.

SCOPE President said the purchase represented a conflict of interest, which is part of why state law currently does not allow for the CLWA to retail water outside of Santa Clarita Water District boundaries.

The water company had 10 days to respond to a ruling by Administrative Law Judge Douglas Long, who said the Castaic Lake Water Agency needed to seek PUC approval in order to purchase the local water company.

While it was initially established as a water wholesaler, CLWA has a legal right to own Valencia Water Co., a water retailer, according to Masnada.  Masnada is also a recent appointee to the VWC board of directors.

When the CLWA purchased the Santa Clarita Water District, which is also a local water retailer, it did so with a controversial piece of legislation that was not without opposition.

However, AB 134, which was legislation created to allow the CLWA to own and operate the Santa Clarita Water District and its 29,000 customers -- or 41 percent of the retail market -- with certain provisions that limited retail operations to SCWD customers. AB 134 cites that CLWA “may not exercise retail water authority outside the boundaries (prescribed for the SCWD).”

This means that as the state law stands now, the CLWA has the authority to own the water retailer, but it will be operated as a Public Utilities Commission-regulated entity.

The CPUC exercises statewide authority over all privately owned utilities.

A law was passed in 2000 giving CLWA the ability to retail water, but only to a certain area. 

Click here for a link to the most recent Valencia Water Co. story. 

 

 

 


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