Global Water Rate Case
The Arizona Corporation Commission has required us to file an application to change our rates. Our rate case application was filed August 28, 2020. We are proposing that any new rates be delayed until January 1, 2022 and that any new rates be phased in, with no increase greater than 5% per year.
At Global Water, we care about our customers and the quality of service we provide. We understand and appreciate that many of our customers may be experiencing the impacts of COVID-19 at this time and it is not the best time to file a rate case application. We understand. However, we do not expect a decision on rates before September 30, 2021 and we are asking that any rate changes not be effective until January 1, 2022.
We have recently expanded our Customer Assistance Program and we may be able to help with bill payment assistance. Please visit our Customer Assistance page for more information.
About the Rate Case
Which Global Water Utilities are included in the rate case?
The Arizona Corporation Commission has ordered all of our utilities to file a rate case application no later than August 28, 2020. The rate case will include the following utility companies, serving the following areas:
When will the rate changes take effect?
We are asking the Corporation Commission to delay any rate change until January 1, 2022. We are also requesting that rate changes be phased in over three years, rather than taking effect all at once. If the Arizona Corporation Commission agrees with these requests, the first phased increase will be on January 1, 2022; the second phased increase will be on January 1, 2023, and the third and final phased increase will be on January 1, 2024.
Why are the Global Water Utilities filing a rate case?
The Arizona Corporation Commission, which sets the rates that the Global Water Utilities charge, has ordered the Global Water Utilities to file a rate case application no later than August 28, 2020.
What is the Arizona Corporation Commission's role in setting utility rates?
The Arizona Corporation Commission (ACC) regulates investor‐owned water companies throughout the state. The ACC monitors service quality, sets rates and inspects utility facilities to ensure they are in proper working order.
Utilities are entitled to recover the expenses associated with operating the utility, plus a reasonable return on infrastructure investments. This money is collected through the rates that customers pay. When a utility requests a rate adjustment from the ACC, several steps are taken. The ACC reviews the company’s financial condition and ensures the company is fulfilling its obligations to customers. The ACC Staff prepares a staff report which lays out staff’s position. A public hearing is held and presided over by an Administrative Law Judge. The judge considers the facts as presented in the testimony and prepares a Recommended Opinion and Order (ROO) which advises the Commission of Staff’s recommendations regarding the rate case. The Commission considers the ROO and may accept, modify or reject any or all of recommendations.
What is a rate case?
Over the years a system has been developed to consider rate cases. The utility presents its case, and customers and regulators can challenge the utility’s requests. In Arizona, an independent agency represents customers’ interests, the Residential Utility Consumer Office (www.azruco.gov). RUCO has trained lawyers and accountants who represent customers in rate cases.
Early in the process, a schedule of public hearings is created that allows the public to follow and participate in the process. The utility is required to support its request through testimony and exhibits that must meet rigorously applied standards of evidence. During the hearing process, the utility is subject to cross examination and evidence presented in the proceeding can be challenged on a number of grounds.
The rate case process involves the following stakeholders:
members of the public, including local government, public interest groups and other organizations and individuals;
RUCO gets involved in certain cases, and
the Arizona Corporation Commission Staff.
What are the Global Water Utilities doing to limit the impact of any rate increase?
The Global Water Utilities are proposing that rates be phased in, so customers experience smaller, gradual increases and that new rates will not take effect until January 1, 2022. Additionally, we will continue to offer a Conservation Rebate for customers who conserve water and use less than 6000 gallons of water in a billing period. We are not asking to include the Global Water - Palo Verde Southwest Water Reclamation Facility in ratebase, although we have incurred significant costs in financing and constructing the Southwest Water Reclamation Facility. We have voluntarily excluded some expenses. Our approach is to be reasonable in our rate application, being mindful of the impact these rates will have on all of our customers. As a result, our proposed rates are less than the rate of inflation, as mesaured by the Consumer Price Index since our last rate case which was based on 2011 financial information.
How long has it been since the Global Water Utilities filed a rate case?
The majority of the Global Water Utilities filed their last rate case application eight years ago in 2012, based on 2011 financial information, referred to as the 2011 Test Year. The current rate case application will be based on a 2019 Test Year. Considering the rate of inflation, as measured by the Consumer Price Index, the rates proposed by Global Water will be increased less than the rate of inflation since 2011.
What improvements have the Global Water Utilities made to Customer Service?
We have increased our customer assistance program, providing payment assistance to customers experiencing low income, a work furlough, or a medical hardship, as well as assistance to disabled veterans and deployed service members.
The Value of Global Water
At Global Water, we care about our customers, the quality of the service we provide, and we strive to be good citizens of the communities we serve.
Safe, Reliable Service
For over four years now, we've had a perfect record of complying with all regulations concerning the quality and safety of our utility services. At Global Water, we take seriously our responsibility to provide safe, reliable drinking water, wastewater, and recycled water.
Now, more than ever, communities are recognizing that water and wastewater are essential services and our employees are essential employees. In the last three years, our employees have had only two minor safety incidents. That's important because we want all employees to go home safely every day. It also results in real savings to customers, with lower workers compensation insurance costs and less lost working hours.
Focus on Customer Service
We are happy to say our customer satisfaction is increasing. In 2019, we introduced a new on-line portal and 66% of our customers have registered to us this on-line service to view information about their water usage and account. In Maricopa, we have the ability to send customers leak alerts, warning them that they may have a leak in their plumbing or sprinkler systems. We estimate that eliminating leaks in their plumbing or sprinkler system, customers have saved over 8 million gallons of water on their water bills.
Caring for Our Customers
In 2020, we significantly expanded our Customer Assistance Program, to provide additional benefits to customers who are experiencing hardship. Qualifying customers with reduced income, furloughed workers, those with medical hardships, disabled vets, and deployed service members may be eligible for up to $700 annually in bill payment assistance. As of July 2020, approximately $50,000 has been provided to help customers pay their bills.
We continuously invest in maintaining our utility systems, building projects to accommodate economic development in high growth areas, and working to assure that our utilities remain in compliance. We never want to let our customers or our communities down, and that means we are constantly focused on improving.
Conserving Precious Water Resources
Since we first began, Global Water has focused on conserving water resources. By encouraging the use of recycled water for irrigation, we have saved over 8.5 BILLION gallons of groundwater, saving that groundwater for future use. We offer a rebate each month to customers who conserve water -- that's money back on your bill if you use less water. We are leaders in helping resolve water scarcity problems in all of our utilities. In the Maricopa area we are leading a regional water resource study and helping to lead a stakeholder process to address regulatory issues around water supplies.
We are about the communities we serve. In 2020, we have contributed $22,000 to community food banks to help address the impact of COVID-19. We sponsor the Safe in the Water Program, which teaches students in Maricopa about water safety to prevent accidents and drowning. We support local education, sponsor community events, and participate in the local leadership groups.
Rate Case Presentation
On July 21, 2020, Global Water made a presentation to the Maricopa City Council regarding its planned rate case application to inform the community of the rate application. In the following month, before the application was filed, we also presented this information to Arizona Corporation Commissioners, Corporation Commission Staff, and the Residential Utilities Consumers Office. The presentation summarizes the process by which the Arizona Corporation Commission authorizes new rates for the Global Water Utilities, the investments and improvements that have been made to the water and wastewater utilities, and Global Water's approach to achieving a reasonable rates. If you have questions about this information, please contact us.
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Comments and Questions
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