Amador Water Agency Directors discuss options

Amador Water Agency Directors discuss options if voters deny rate increases

What legal options does the Amador Water Agency have when an individual water or wastewater system continues to run in the red and ratepayers refuse to allow a rate increase? The Water Agency Directors discussed theoretical options during a presentation at the AWA Board of Directors meeting August 23rd. Agency Counsel Steve Kronick said that the Agency most likely could not declare bankruptcy for any individual system, though there is a process for the Agency itself to declare bankruptcy. The Amador Water Agency includes four separate water systems and three wastewater systems. However, Kronick said an individual system can be sold to a private entity. The Public Utilities Commission would regulate water or wastewater systems purchased by a private utility company. The PUC would set rates and fees and would not be subject to California’s Proposition 218 protest process. Private utility companies are also entitled to turn a profit over and above cost of doing business as opposed to government agencies, like the Water Agency. AWA General Manager Gene Mancebo said that all over the State, private companies are taking over small utility systems because of the high cost of operations. Water Agency Directors and Mancebo said that the currently proposed Agency-wide system rates would get Amador County’s underwater systems back on track. Macebo added that there are no plans at this point to sell any systems or declare bankruptcy.

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