La Paz County District 2 Supervisor Duce Minor filed to “intervene” in the case of EPCOR and Brooke Water at the Arizona Corporation Commission. As a result, he not only gave testimony, he got to examine witnesses at a hearing on the matter Jan. 22 and 23 in Phoenix.
The hearing was held before Administrative Law Judge Charles H. Hains.
Minor filed a motion to intervene Dec. 11 and was added to the list of people intervening on Jan. 6. He said it was quite an experience and he learned a lot more about how the system works. He also made his points regarding how the matter will affect the residents of the Parker Strip area north of Parker. He urged the commission to reject the sale of Brooke Water to EPCOR and to consider their duty to protect consumers.
Brooke Water LLC is a private utility that provides water to residents and businesses along the Parker Strip. The matter before the Corporation Commission actually involves three issues. The first is the proposal of EPCOR Arizona to purchase Brooke. If that is approved by the commission, EPCOR wants to merge Brooke’s district with their own district at Desert Hills. They also have a proposed rate hike before the commission. If the sale is not approved, Brooke has their own proposed rate hike before the commission.
Brooke’s proposed rate hike is slightly higher than EPCOR’s, but both are proposing rate hikes of approximately 40 percent.
Minor said he lives on the Parker Strip and is a Brooke customer. He said he’s concerned about what effect the rate increases will have on local residents. He noted Brooke hasn’t had a rate case before the commission since 1992, but added that’s not the fault of Brooke’s customers. He said they’ve been dealing with poor water quality for years.
Minor said there are many questions on this matter, and they mostly involve what will happen if one of the items is approved. For example, if the sale of Brooke is approved, should it be merged with EPCOR’s Desert Hills district in Lake Havasu City? Should the rate increases be approved, even if the sale is denied? If the increases are approved, should they be phased in over two or four years? Should the rate structures be tiered? If a tiered structure is approved, what should the threshold be?
With the rate increases, Minor said he believed they should be phased in over four years, unlike the two years Brooke and EPCOR are describing. He said this would cause “rate shock” for Brooke customers, and could cause financial hardships.
Minor also opposed a tiered rate structure, even though the commission wants such structures to encourage conservation. He said the figure used for the average for Brooke customers, 2,567 gallons per month, was misleading as it did not take into account all the weekend and vacation homes on the Parker Strip that are unoccupied for much of the time.
The average household in Arizona uses 7,500 gallons per month, Minor said.
With a tiered system, Minor said Brooke customers will spend more on water but it won’t cost the company anything more per gallon to produce it.
In a letter to the Corporation Commission, Minor requested the sale to EPCOR be denied. He also said the rate increase requested by Brooke should be denied. He said Arizona utilities are required to make all repairs and system upgrades before they can ask for a rate increase. He said Brooke has made substantial improvements to their system since a system failure in August 2016 exposed many of their problems. However. Minor said they still have a way to go.
If the sale to EPCOR is approved, Minor said he opposed merging the Brooke Water and Desert Hills districts. He noted there is a lot of distance between them, and they are very different systems.
“Allowing the combination of the two CC&Ns (water districts) makes no more sense than combining the Parker Strip’s CC&N with EPCOR’s CC&N is Surprise, Arizona,” Minor said in his letter to the Corporation Commission. “The only apparent reason for EPCOR’s request is for them to benefit from an immediate rate increase along the Parker Strip.”
One of the reasons given by EPCOR for merging the Brooke and Desert Hills district would be “economies of scale” when it came to maintenance and upkeep. They would be able to share equipment and facilities. Minor asked an EPCOR engineer if that could still happen even if EPCOR bought Brooke and didn’t merge the two districts. The engineer replied it would.
Minor urged the commission to remember that they are the ones protecting consumers in this case. He said they have a right to safe, reliable water service at a fair price.
“My goal is to mitigate the impact of all this,” Minor told the Pioneer. “There will be an impact.”