|Residents have icy reception to water rate increase posted on 01/01/2021|
After a summer of tap water with high levels of iron, Cedar
Glen Estates residents got a chance to voice their displeasure over a proposed
water rate increase and the water quality and service provided by the Salmon
Valley Water Company (SVW). The Public Utility Commission of Oregon (PUC) held
a telephone public comment hearing regarding the SVW’s for a rate increase on
Tuesday, Dec. 8.
Residents of Cedar Glen Estates cited financial and
quality-of-life impacts resulting from the water quality and a proposed base
rate that will be significantly higher than the rate in neighboring communities
as reasons for the PUC to refuse the request.
“I am opposed to the increase in rates for Salmon Valley
Water Co. until they can demonstrate that the water they provide is safe to
drink, and that they will show integrity in managing this vital resource,
including refunding customers who are not able to use the water due to poor
quality, they should not be allowed to charge more to customers,” Welches
resident Rachel Vance said in a public comment submission to the PUC.
SVW is in the process of drilling a new well to accommodate
increased demand in the region and reduce the iron concentration in the water
supply. The construction was slated to be completed by the summer of 2020, but
was delayed due to the COVID-19 pandemic.
“More than anything the new well is driving the rate
increase,” SVW general manager Michael Bowman said.
The monthly bill of the average residential customer served
by SVW will increase from $24.99 per month to $32.98 in the first year and then
to $44.68 per month in the second year with the new tariffs. After deducting
for operating expenses, the projected revenues will produce a 7.25 percent
return annually for the utility according to the company’s general rate
revision filing with the PUC.
This is a reduction from the 7.6 percent rate of return the
PUC granted SVW when it applied for a rate revision in 2014.
A representative for SVW stated that the complaints stem
from the use of an old reserve well during periods of high demand. The well,
located off of East Routledge Lane, has a high concentration of iron from years
of use and is known locally as the “iron well.”
The stay-home restrictions over the spring and summer of
2020 created the highest demands in the utility’s history with usage up 30 to
35 percent. This resulted in SVW incorporating water from the iron well into
their main supply more frequently than in past years.
“We’re fully aware (the iron concentration) causes problems
for our customers and we feel we have a very good solution with the new well,”
Bowman said. “We empathize with any difficulty our customers have faced. We
have a good level of confidence that we’ll have the issue resolved going
Iron is labeled a secondary contaminant by the Environmental
Protection Agency (EPA). Secondary contaminants are not considered a risk to
human health. The EPA has established non-enforceable “secondary maximum
contaminant levels” as guidelines to assist public water systems in managing
their drinking water for aesthetic considerations, such as taste, color and
Bowman stated that the SVW complies with the recommended
guidelines and tests regularly to assure the iron content remains below the
three parts-per-million standard.
The target date for the completion of the new well is April
1. It will replace the iron well in meeting increased demand during peak summer
“Utilities are only allowed to recover costs that are
reasonably and prudently incurred, and Oregon law requires that rates must be
just and reasonable. The profit margin that a company is entitled to earn is
based on a number of factors including the national economy and the level of
business risk when compared to similar companies. The Commission employs a team
of economists who regularly conduct these analyses to ensure that the public
interest is represented,” the PUC noted in an email.
“Public comment is certainly an important part of our
process,” said Kandi Young, PUC public information officer. “I would strongly
encourage community members to reach out with issues. It’s important for the
commission to hear their input."
The Oregon Public Utility Commission can be reached by phone
at 503-373-7394 or by email at firstname.lastname@example.org.
By Ben Simpson/MT