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Hundreds turn out to pan Far West at rate hearing
Peter Johnson says he's a cash cow that's about to go dry.
The Foothills resident was one of about 1,000 to 1,200 customers of Far West Water & Sewer to pack a public comment meeting Wednesday evening with the Arizona Corporation Commission, which will decide the contentious request by the Foothills utility to increase monthly sewer rates from $21.75 to $62.65.
The revenue increase, if approved, would benefit Far West in the amount of about $3.9 million.
Speakers like Johnson had at least one thing in common: They did not support Far West's proposal, or much about the company at all.
“I'm getting so tired of being a cash cow for incompetence run amok in this country,” Johnson said.
Four of the five commissioners traveled to Yuma to hear out members of the near-capacity crowd at the Gila Ridge High School auditorium. The corporation commission typically holds its hearings and meetings in Phoenix, but a large contingent of Foothills residents lobbied to have a more convenient meeting close to home.
About 40 people spoke, and while some said a small increase in sewer rates might be reasonable, nobody spoke in favor of the proposed 188 percent hike.
Many speakers decried management, asked for audits of the company's finances, and lamented the storm in September 2012 that left some Far West customers with low water pressure or no water at all for up to 36 hours after a power outage and lack of backup generators.
In a rate increase application to the corporation commission last summer, a Far West official said the company's financial condition is “grim,” and the increase would be needed to stave off bankruptcy. But some audience members, like Jerry Barton, didn't think that a bad thing.
“The best thing they can do is go bankrupt,” he said.
Guy Selle said the utility's managers want to collect more revenue in anticipation of future development, which requires sufficient sewer capacity. The principals of Far West are also developers who own considerable swaths of land in the same Foothills area.
“They want to do expansion on the back of the senior citizen,” Selle said.
Almost all of the speakers were seniors who said a near-tripling of bills would be hard on their fixed incomes, although one speaker said it would also be difficult for younger families and her Marine neighbors, whose paychecks wouldn't be climbing at the same rate.
Many winter visitors reiterated how they must pay a monthly bill even when they're not in town.
Marvin Alford got chuckles when he spun a yarn about visiting the Far West office and asking the employee at the front desk for a pen and a slip of paper. Why? He wanted to write Far West a bill — he's a pilot, and he recently flew to Oregon with five open seats on his plane.
When the Far West employee pointed out that nobody from the company was on the plane, he said, well, the opportunity was there, it's not his problem that they didn't take it.
Others complained about sewage odors. Sandra Rogalski lives 400 feet from the wastewater treatment plant on Avenue 14E.
She said the smell wasn't there during the day when she viewed and bought her home, but when she moved in, she found that a foul smell crept in at night. For the past 12 years, she's not gotten a satisfactory response to her concerns. Nor has she ever slept with her windows open.
“It honestly smells like a barnyard,” Rogalski said.
Yuma County Supervisor Russell McCloud, who is usually on the other side of the dais during public commentary, suggested that the commission consider a limit on how much a utility can seek when going out for a rate increase. A limit might make the companies more forward-thinking, he said.
After every speaker card had been called, commissioner Brenda Burns asked the audience members if they'd approve of letting an earlier speaker, whose remarks didn't fit into the three-minute limit, again take the floor. Some speakers had said they'd shorten their commentary and give him their time, so the audience applauded in a clear affirmative.
That speaker, Merlin Pendray, wrapped up his statement by referring to a section of testimony prepared for the corporation commission's consideration by a financial analyst from the state Residential Utility Consumer Office.
The analyst referenced key Supreme Court cases that said that “a public utility that is efficiently and economically managed is entitled to a return on investment that instills confidence in its financial soundness, allows the utility to attract capital, and also allows the utility to perform its duty to provide service to ratepayers” — or more clearly, “that a utility, such as Far West, is provided with the opportunity to earn an appropriate rate of return if the company's management exercises good judgment and manages its assets and resources in a manner that is both prudent and economically efficient.”
“Please consider the over-presumption of that statement in this case,” Pendray said.
Hillary Davis can be reached at email@example.com or 539-6857. Find her on Facebook at Facebook.com/YSHillaryDavis or on Twitter at @YSHillaryDavis.