Public comment sought on Rio Rico utilities rate case

PHOENIX--In June 2003, Rio Rico Utilities filed an application to raise water and wastewater rates for its 4,200 water customers and 1,500 wastewater customers in Santa Cruz County.

The Residential Utility Consumer Office (RUCO) filed to become an official party to the case to represent the interests of residential ratepayers. An administrative law judge held a hearing on the case in Tucson on June 3, 2004.

The judge prepared a written recommendation, which was presented for a decision by the commissioners on Aug. 31, 2004.

To ensure that Rio Rico customers are aware of the potential impact of this case, the commissioners have scheduled a public comment session in Rio Rico.

The session will be held Sept. 21, 2004, from 5 to 7 p.m., Rio Rico Community Center, 391 Avenida Coatimundi, Rio Rico.

As the commissioners prepared to vote at the Aug. 31 meeting, two separate issues came to light.

Size of rate increase

The first issue centered on the company's notice to the community about the size of the potential rate hike and the level of awareness among Rio Rico Utilities' customers.

No customers had appeared at the June hearing in Tucson to offer public comment or input.

The second issue centered on whether the RUCO and Rio Rico Utilities could resolve disputes over specific line items included in the wastewater rate base and the actual rate calculations.

The commissioners directed the parties to the case to work together to see if the disputed issues could be resolved to the satisfaction of all parties.

The company contends that it has invested a significant amount of money in building a reliable water and wastewater treatment plant to serve its customers.

It also contends that the costs of treating wastewater have risen significantly in recent years due to more stringent environmental and public health rules.

Wastewater rates

Because of the size of the wastewater increase, the company proposed phasing it in over a three-year period.

The judge agreed with the three-year phase-in but came to a different conclusion on the actual rates.

The example below shows the total rate impact for a typical customer with a 5/8 -inch line.

Currently, a typical 5/8-inch meter customer pays $26 for wastewater service.

Rio Rico Utilities originally proposed to take the typical customer's rates up to $60.84, phased in over three years, reflecting a total increase of 134 percent.

The judge recommended an increase from $26 to $38.86 or 40 percent for the first year.

Then rates would go from $38.86 to $51.92 in year two, representing a 33.1 percent increase over year one.

The final increase would take effect in year three going from $51.92 to 58.40 for an increase of 14.4 percent.

Water rates

Rio Rico Utilities originally proposed an increase to an average residential water customer with a 5/8-inch meter from the current rate of $17.61 to a new rate of $22.63 or an increase of $5.03 or 28.54 percent.

The judge recommends an increase of $4.67 or 26.5 percent based on evidence reviewed in the case.

This would take the current average residential water bill from $17.61 to 22.28.

The last time rates changed for water or wastewater was in March 1996.

Public comment

Public comment sessions are formal proceedings and all comments will be recorded or transcribed by a court reporter.

The commissioners may limit the duration of each individual's comments to allow everyone a fair opportunity to speak.

If you cannot attend in person, the commission encourages the timely submission of written comments by mail or e-mail before the end of the day Sept. 24, 2004.

Submit comments to the Docket Control Center and they will be shared with the commissioners.

Be sure to reference the appropriate docket number for this case.

WS-02676A-03-0434 - Rio Rico Utilities

Arizona Corporation Commission

Docket Control Center

1200 W. Washington

Phoenix, AZ 85007

ACC Web site

You may also comment through the commission's "Can We Help You" page on the Utilities Division Web site.

Be sure to include the docket number listed above.

For instructions on filing electronic public comment, click on http://www.cc.state.az.us /utility/cons/index.htm.