Cost of Capital Documents
ADDED 8/30/17 - A Public Participation Hearing will be held in San Jose sometime in September. Time, Date and Location TBD. 9/20/17 - The CPUC continues to stall and there is still no date for a Public Hearing.
ADDED 6/18/17 - Cost of Capital Application - SJWC filed application A.17-04-001 on April 3, 2017. The CPUC decision will be made some time in December 2017. This Cost of Capital (CofC) is the foundation for the next General Rate Case for setting our rates for the years 2019, 20 & 21 and it will also affect our current General Rate Case effective January 1, 2018. The current CofC allows SJWC an 9.43% rate of equity. SJWC is seeking to increase its rate of equity to 10.75%. ORA testimony seeks to decrease the rate of equity to 8.30%.
In this proceeding, four of California’s largest investor-owned water utilities have requested increases in their authorized rates of return. The authorized rate of return compensates utilities for their costs of financing necessary infrastructure. The authorized rate of return takes into consideration the cost of debt, a return on investor’s equity, and the proportion of debt and equity that comprise a utility's overall capital structure. The current cost of capital proceeding will establish authorized rates of return for the 2018 through 2020 period.
On August 1, 2017, ORA served testimony based upon its independent analysis of the utilities’ applications. The following table compares each of the four utilities’ requests with ORA’s recommendations and calculates the approximate annual difference in customer rates that would be expected to result.
The Commissioner and Administrative Law Judge assigned to the CofC application are:
- Commissioner Martha Guzman Aceves
- Administrative Law Judge Karl Bemesderfer
Cost of Capital Attachments:
ORA’s August 1, 2017 testimony below:
Direct Testimony of Aaron Rothschild for ORA - Proceeding A.17-04-001 et al.
Documents Referenced in Direct Testimony of Aaron Rothschild - Proceeding A.17-04-001 et al.
Direct Testimony of Mukunda Dawadi for ORA - Proceeding A.17-04-001 et al.
Lynch Testimony & Schedules.pdf
Advice Letter 501 Documents
ADDED 8/30/17 - Water Division's Proposed Resolution W-5150 (rejection of AL501) is scheduled to appear on the September 28, 2017 Commission Meeting Agenda (ID#15960). Best outcome for ratepayers would be for the Commission to adopt Resolution W-5150 and affirm rejection of Advice Letter 501 (implementation of SRM mechanism).
February 8, 2017 - CPUC Suspension Notice for SJW's Advice Letter 501 requesting rate increases.
Click on "Suspension Notice" to view document.
The initial suspension is from 2/9/17 to 6/8/17 for the following reasons:
- Advice Letter not in compliance with Commission Statute/Decision/Resolution.
- Additional time is required
- D.16-12-026 has to be modified
ADDED 5/4/17 - The California State Auditor September 2016 Report on the California Public Utilities Commission (CPUC).
Quote on first page of audit report. "It Should Reform Its Rules to Increase Transparency and Accountability, and its Contracting Practices Do Not Align With Requirements or Best Practices."
Click on "California State Auditor September 2016 Report" to view document.
ADDED 5/4/17 - Drought Surcharge Program - CPUC Office of Ratepayer Advocates (ORA) testimony and appeal regarding SJWC's drought surcharge program. The CPUC ignored the ORA's testimony and appeal and the over 1000 protests from SJWC customers. This is a direct quote from ORA testimony. The CPUC found no problem violating CPUC Code Section 728 to allow SJWC to implement a discriminatory drought surcharge program. Click on Download File to view documents in their entirety.
From Testimony "...AL 472 and AL 473 requests relief that is neither just nor reasonable, in violation of California Public Utilities Code Section 728.1 The proposed water allocations and surcharges for usage above the allocations are discriminatory in that they are unjustifiably applied to only residential and “landscape services” customers. Additionally, “water- dependent businesses” would be inexplicably exempted from the proposed Stage 3 restrictions on water waste. Finally, surcharges collected exclusively from residential and “landscape services” customers would be used to offset costs that would have been the responsibility of all customer classes..."
From Appeal "...ORA argues is unlawful, unreasonable, discriminatory and preferential....
...ORA notes that, in April, 2015, before the implementation of the Monthly Drought Allocation and Drought Surcharge program,, SJWC customers reduced consumption be 25.3 percent from 2013 levels for the corresponding month..."
ADDED 5/4/17 - Advice Letter 507 - SJCW is requesting that the Water Rate Assist Program (WRAP) which automatically qualifies customers already part of PG&E's CARE program be changed from PG&E's previous year's guidelines.
WRATES is questioning if the CPUC thoroughly evaluated the WRAP program? Has the CPUC confirmed that over 20K single family residence (single meter) in silicon valley qualify for WRAP? This does not included multi-family housing as they are not on a single meter. That means that a single family residence of 1-2 Persons has an income of less than $32,480/year. A quick search on trulia.com shows single family homes rent for well over $2K/month. Why is SJWC able to use PG&E's CARE program database? Customers who pay an electric bill may not be living in a single metered home and therefore do not receive a water bill. SJWC should be required to screen and qualify their own customers with the oversight of the CPUC.
ADDED 5/13/17 - Advice Letter 508A - SJWC is requesting that 2014 MCRAMA and 2015 WCMA surcharges be reinstated. SJWC posted their latest advice letter filings on their website on May 6, 2017; AL508A filed 5/2/17 and 5/4/17. If approved, it will increase our rates 0.95% for the average user. Click on FILE COMPLAINT and follow instructions to file a protest against AL508A.
U.S. Securities and Exchange Commission - SJW
A Comparison of SJWC Bills July-August Billing Period 2013-2016 & EMAILs from John Tang and Rita Benton
How many of you increased your number of watering days from 2 to 3 days a week after we received the letter from SJWC dated June 30, 2016 stating water conservation has been reduced from 30% to 20%? We did and got hit with DS1 and DS2 surcharges.
ADVICE LETTER FILINGS WITH THE CPUC - Check this website regularly to find out if SJWC has filed for rate increases etc.
SAN JOSE WATER COMPANY WATER RATE ASSISTANCE PROGRAM (WRAP)-
Free Water Service to SJW Employees
General Metered Service and Rates
Allocation Appeal Form - If you have more than 4 people in your household, SJWC says you can appeal the water allocation and receive 2 additional units per person over 4.
To subscribe to CPUC to receive automated notifications on SJWC Rates go to
Follow James Hunter's blog - San Jose Water Company (SJWC) Rate Increase
Oct. 19, 2016 Saratoga City Council Meeting VIDEO - City Attorney Presentation - #4.1 on the Agenda
Saratoga City Council Meeting - Oct. 19, 2016 Agenda
At the Saratoga City Council meeting on Oct. 19, 2016 the SJWC Rate Issues were discussed. The City Attorney, Richard Taylor, presented his findings. After listening to the Attorney and citizens speak about SJWC and the CPUC, City Council member, Howard Miller, proposed the following 6 part motion, which was approved by all council members. Although these motions may not seem like enough action, they are steps in the right direction and we need to build our case against CPUC and SJWC. These issues are not going to be resolved overnight and we need to continue the fight.
At the Friday, Oct. 14, 2016 Mayors and Managers meeting, (Campbell, Cupertino, Los Gatos, Monte Sereno and Saratoga) the mayors agreed to write a joint letter to the CPUC. In conjunction with that letter, the CPUC needs to hear from EACH and EVERY one of us in the form of FILING A COMPLAINT with the CPUC against SJWC. Please take 15-20 minutes to file a complaint with the CPUC against SJWC. The more complaints they get, the more we will be heard. It is very important that you file a complaint!
6 Part Motion:
#1 – Agree that we need joint regional support. The council agrees that we need to be in a position to have enough data to challenge future rate increases. Reach out to the following groups to find out where we have common cause:
Mayors & Managers
Water Commissions (SCVWD)
Staff level with the other SJW customer cities
#2 – Reach out to Representatives in Sacramento. Mayor Cappello said they already have a meeting scheduled with Assemblymember Evan Low and Senator Jim Beall and they will add water to the agenda to brainstorm ideas.
#3 – Reach out to SCVWD at a staff level and board member level. Council will reach out to Nai Hsueh as she is a Saratoga elected representative.
#4 – Task for Saratoga Council – Look into hiring a Rate Consultant and Advocate to do deeper analysis to help us with CPUC and SJWC.
#5 –City Managers will explore short term joint activities such as hire rate analyst and request rate modifications from the CPUC. Council agrees that the long term view is that we no longer live in a world where we can let the CPUC do their thing. We need a regional approach to address these issues. CPUC is going to have an ever encroaching role on our rates within our cities so we need to work as a region to band together in common cause.
#6 – Meet with SJWC to definitively and accurately explain every line item on the water bill.