Cal Am asking for rate increases for Monterey Peninsula water bills

SEASIDE, Calif. (KION) Monterey Peninsula residents and others in the county could see their water bills getting even higher by next year.

California American Water is asking for an average statewide rate hike of over ten percent in 2021. It will continue increasing by about 3.5% in each of the next two years. The utility company says the average bill will go up about $16 and total about $8 million in three years.

The advocacy group Public Water Now, however, says there is a long list of current and pending taxes and surcharges that they claim will lead to a 40 percent increase in water bill costs. Cal Am disputes this.

"They want more. A lot more. When will this end? That's the question on a lot of people's minds in this community," said a public commenter in Seaside on Tuesday.

Tuesday night, the California Public Utilities Commission heard residents weigh in about Cal Am's request to increase the water bill rates. There was no shortage of people expressing their frustration.

"Is it possible for the CPUC to do its regulatory duty and rein in this behemoth until the community can finally divorce Cal Am entirely?" asked one resident during the public comment period.

"If you look back over the last 10 years, it's been 17 percent every year for 10 years increase on our water bills," said Melodie Chrislock, the managing director of Public Water Now.

Water activists are fighting to stop the surcharge method of upping water rates, which they claim companies discreetly use to hike up bills. They say these charges will be added on top of the other increases.

But Cal Am representatives say that is simply not the case.

"We made sure to include all the surcharge increases in that total water proposed increase that was shown on the notice," said Catherine Stedman, a spokesperson for Cal Am.

The company says the increases are meant to rebuild aging infrastructure including water main replacements, well repairs and storage improvements. It will all total $60 million.

Seaside Mayor Ian Oglesby argued rate hikes will deplete what little disposable income his residents have.

"That means less new clothes, shoes, school supplies for our kids, and more than likely, less money for more nutritional food," said Oglesby during public comment.

We asked Cal Am if these rate hikes only bolster the movement to publicly buy out the company's infrastructure. They were adamant.

"No matter who owns the water system, whether it'd be a government agency or a public utility such as ourselves, those costs need to be paid," said Stedman.

The CPUC will ultimately make the decision on whether to approve the rate hikes, and Cal Am says the commission will likely do so at the end of the year.

If they are approved, the new rates will be effective January 2021.

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The California Public Utilities Commission is holding a public hearing to discuss Cal Am's proposed rate increases Tuesday, according to Public Water Now.

Public Water Now said Cal Am is asking for an average statewide increase of 10.6% in 2021, a 3.6% increase in 2022 and 3.8% in 2023. Cal Am is also accused of trying to hide another 15% to 20% in more new surcharges. You can read a list of Cal Am's approved and pending surcharges here.

“We already have the most expensive water in the country,” said Melodie Chrislock, Director of Public Water Now. “We need a more transparent and accountable system from the CPUC. It is the only agency who can control Cal Am’s rates. This is the public’s chance to weigh in on our outrageous water costs and hold both Cal Am and the CPUC accountable.”

The Public Advocates Office at CPUC is working to stop surcharges to increase water rates between general rate cases, according to PWN. The organization said the office is asking the CPUC to stop using mechanisms like the WRAM surcharges that make rates seem lower, even though they create more in surcharges once the general rate case is over. PWN said Cal Am has also included special requests that would let them earn shareholder return on balances in the surcharge accounts and raise the 15% cap on WRAM surcharges to 25%.

The hearing will be held at 6 p.m. Tuesday in the Seaside City Council Chamber.