1-08-2008 by simpson
If you’re bothered by soaring gasoline prices here’s an increase that’s even more appalling. A water company owned by Chevron is seeking a 138% water rate increase that 200 residents of rural Casmalia, CA say could kill their community.
The background on the oil giant’s latest outrage was reported by Malia Spencer in The Santa Maria Times. Casmalia gets its water from the Casmite Water Corp. now owned by Chevron. Casmite has provided Casmalia’s water since the 1940s when it had oil operations in the area. Unocal acquired Casmite in 1953 and then Chevron swallowed up Unocal in 2005.
In the early 1900s Casmalia had a population of 1,500. It’s since dwindled to around 200 and is perhaps best known for The Hitching Post Restaurant.
Unocal ended up selling its oil fields in the area, but continued operating the water company as a “courtesy.” At a recent hearing run by PUC commission staff member Robert Weissman, company officials said that before 2005 the water company was not collecting fees that covered its cost.
The execs maintain that now the water company is under PUC jurisdiction they are required to recover costs through the rate structure. That means they should raise annual water revenue received from 52 residential customers $100,300 from $72,700. That’s not even a drop in the bucket to the oil giant, but it’s huge to residents with a median household income of $27,000.
Terri Stricklin, Casmalia Community Services District secretary, says the average monthly water bill is $115. Under the Chevron-backed increase it would be $272.
Currently customers of other water systems in Santa Barbara County pay $40-$60 for 1,000 cubic feet of water. It’s $106 in Casmalia.
What you’ve got is a struggling rural community that needs water and a Chevron-owned company that’s applying the letter of the law to 52 residential customers without any regard to fairness, compassion or commitment to what’s really right. More than anything else, I suspect, Chevron wants to get out of the water supply business. But there is a sensible way to do it that could even win the oil giant some plaudits.
Undoubtedly the water system didn’t get the attention it should have received when oil companies were running it. Now getting things up to snuff and keeping them there, might technically justify the proposed rate increase. But it could kill the community.
Here’s the best solution: Certainly Chevron wants out. Before leaving, Chevron should pay whatever necessary to get the system in shape and do whatever else is needed so it can to merge with a viable utility. Then rates could be spread over a reasonable customer base. Or do Chevron’s executives really prefer another public relations black eye?