Golden State Water Company:
2016 General Rate Case (GRC)
In July 2014, Golden State Water Company filed its Application requesting CPUC approval to increase its customers' rates for water service in its Region 1, 2, and 3 customer service areas by:
- 2016: ($1.62) million or -0.50% = $319 million total Revenue Requirement
- 2017: $10.28 million or 3.21%
- 2018: $10.30 million or 3.12%
The CPUC held Public Participation Hearings in Golden State's service territory from November 13 - December 9, 2014.
Proposed Settlement Agreement
On July 6, 2015, ORA and Golden State Water Company filed a partial Settlement Agreement with the CPUC agreeing on:
- 2016: Golden State’s proposed revenue requirement at the partial settlement is $300 million while ORA’s proposed revenue requirement at the partial settlement is $285 million, with a difference of $15 million in unresolved revenue requirement issues remaining.
The proposed Settlement also resolves a number of other issues, including:
- Number of customers and sales per customer
- Operation & maintenance expenses
- Administrative & general expenses
- Allocated general office expenses
- Select utility plant additions
- Depreciation expense and reserve
- Working cash allowance
- Various taxes
- Rate design
- Most of Golden State’s special requests.
The proposed Settlement is pending a CPUC decision.
Gardena Water Quality Issues
On April 13, 2015, the CPUC issued a Ruling approving ORA's Motion to open a separate phase to address customer concerns regarding water quality in Gardena, CA.
ORA's Policy Position
Partial Settlement Agreement
ORA supports the partial settlement because it will allow Golden State to operate its systems safely and reliably yet appropriately reduces cost, and is consistent with the Governor’s Executive Order mandating water consumption reductions in response to the drought. ORA also supports Golden State’s agreement to develop internal procedures that will increase transparency and accuracy in its balancing and memorandum account records.
ORA will continue to litigate unresolved issues, including $15 million in revenue requirement for 2016:
- $130 million in capital expenditures for General Office and service areas for 2015-2017
- $4 million per year in employee compensation expenses
- Inclusion of chemical expenses in Golden State’s Modified Cost Balancing Account as requested by Golden State
Additionally, ORA recommends that Golden State should submit attrition / escalation requests to the CPUC whenever there is a revenue decrease or increase.
ORA's Report & Testimony
ORA performed in-depth analysis of Golden State’s general rate case requests, and issued its full Report. Below are highlights of ORA’s findings and recommendations.
See ORA's Executive Summary for a more detailed summary of ORA's findings.
The CPUC should decrease customers' rates for water service in Golden State's Regions 1, 2, and 3 by:
- 2016: ($30.877) million or -9.6% = $291 million total Revenue Requirement, $28 million less than Golden State's request
And allow inflationary increases in 2017 and 2018 of:
- 2017: $ 4.478 million or 1.53%
- 2018: $ 2.762 million or 0.93%
See ORA's March 6, 2015 Testimony.
Gardena Water Quality Issues
ORA recommends that the CPUC should require Golden State Water to provide reports to the CPUC that will:
- Facilitate the CPUC’s monitoring of Golden State's compliance with State Water Resource Control Board directives.
- Ensure Golden State’s related actions to resolve water quality issues in Gardena are adequate and cost-effective.
See ORA’s August 24, 2015 Rebuttal Testimony on Gardena Water Quality Issues.
See the Proceeding docket.
Golden State Water Rates Assistance Program
2013 - 2015 GSWC General Rate Case