- What is Public Water Now?
- Why terminate California American Water (Cal Am) as our water supplier?
- Why public ownership?
- What will Measure J accomplish?
- Who pays for the feasibility study?
- What if Cal Am refuses to sell?
- Can we afford to buy Cal Am?
- How would MPWMD take ownership?
- How would MPWMD take over management?
Public Water Now (PWN) is a local 501(c) (4) non-profit dedicated to securing affordable, sustainable, community owned water for the Monterey Peninsula. We have about 3000 members in support of publicly owned water on the Peninsula.
The Monterey Peninsula has the most expensive water in the country according to Food and Water Watch. Costs for ratepayers have increased 68% in the last two years with more increases scheduled.
After widely promoting conservation, Cal Am charged us $64 million for water we did NOT use to make up for their lost revenue.
Cal Am has not been a responsible steward of our water supply. Cal Am was ordered to stop overdrafting the Carmel River in 1995. In the 22 years since that Cease and Desist Order (CDO) was issued, Cal Am has implemented no new water supply projects. But with the CPUC’s approval it has charged ratepayers $34 million for three failed water projects.
PWN advocates that Cal Am be replaced with a community owned system under the Monterey Peninsula Water Management District (MPWMD). This would achieve community control, accessibility and transparency. The MPWMD board is elected by and answerable to the voters.
Currently 87% of U.S. consumers get their water from publicly owned systems. Public ownership generally provides the best service for the lowest cost to customers. Private ownership is about profit and providing the highest return to shareholders. Local control is also an important benefit of public ownership.
If passed by the voters, it will legally demand that the Monterey Peninsula Water Management District (MPWMD) initiate the process of purchasing Cal Am. The first step in this process is a feasibility study. If the facts show that a public buyout is financially feasible and in the public interest, only then would a buyout of Cal Am be initiated by MPWMD.
The feasibility study will cost about $500,000 and would be paid for by MPWMD out of their reserve fund.
The Monterey Peninsula Water Management District (MPWMD) has the authority to buy Cal Am under eminent domain if it’s determined to be in the public interest.
Cal Am would be forced into court to determine a purchase price if they refuse to sell.
Yes. The price is subject to negotiation or court determination. If acquired through eminent domain, the court will determine the price, not Cal Am.
The Monterey Peninsula Water Management District has the authority to issue public bonds to cover all acquisition costs. The cost to buy Cal Am is offset by the $19 million annually in corporate profit and taxes that Cal Am now takes. This money would be used to pay off those bonds without increasing our water rates. Savings will be greater as the bonds are paid off.
For more detail on this, see this chart.
State law requires a feasibility analysis before a buyout. Within nine months MPWMD would be required to do a feasibility study. If the analysis shows feasibility (cost savings and public benefit), MPWMD would prepare a plan to acquire all the local water assets of Cal Am through a willing buyer-willing seller negotiation or eminent domain court proceedings if necessary.
Current Cal Am operational employees would be retained. A new professional management team would be hired. The CPUC would assure Cal Am’s transfer of responsibility to be as seamless as possible.