Two private water systems are back in public hands

Felton FLOW organized in October 2002 to combat what it saw as RWE’s wanton abuse of rate increases, ultimately getting enough political muscle to pass an $11 million bond measure in 2005, the first $1 million of which was used in the ensuing legal battle against RWE’s reluctant American subsidiary, California American Water (CalAm).

While CalAm conceded the eminent domain fight earlier this year, the negotiations stalled on price, with CalAm claiming the system was worth $23 million, and SLVWD unwilling to pay more than $7.6 million. In the end, an agreement was reached to essentially spend the remainder of Felton’s bond—$10.5 million—for the system. SLVWD will need to find financing for about $1.5 million of that, as well as repair bills due on the system of about $2.9 million.

The bond will cost residents between $550 and $600 a year, but that cost is offset by a steep drop in prices. A typical home now paying $225 a month will see a bill closer to $80 come August.

Felton FLOW’s final act will be a celebration of water independence on July 26 at the Felton Firehouse.

Meanwhile, Aptos FLOW has changed its name officially to Trout Gulch Water Mutual (TGWM), and assumed control of the 182-home, two-well water system in the Aptos hills. Run by Jimmy Smith for more than two decades as the Mar Vista Water Company, the system became a prime target for corporate water takeover when Smith announced his retirement in late 2006.

Customers, rallied by some concerned locals and Jim Graham and Barbara Sprenger of Felton FLOW, began meeting in January 2007 to explore the possibility of a local purchase before CalAm or another entity could scoop the system up. Through a year’s worth of the planning, the committee decided the best step was to form a mutual assistance corporation, which would secure the system in local hands and still leave the possibility of annexation by the surrounding Soquel Creek Water District in the future.

Unlike Felton, TGWM customers will be seeing their rates increase 26 percent, along with a one-time $350 fee for charter membership. However, TGWM officials have stated that rates would have increased in any scenario, and that local purchase was the best way to keep those increases to a minimum.

The system cost $296,000, and requires several major upgrades to its wells. In addition, many customers are still unmetered, which is no longer legal in California.

The original committee is now serving as a pro tem board, but official elections will take place within the next few months, and it will be up to the newly elected board to decide how to negotiate the financial issues ahead.

The only other mutual water company in Santa Cruz County is Summit West, a small district just off Highway 17 above Scotts Valley.

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