Are we screwed?

Discussion in 'Sun City General Discussions' started by BPearson, Jun 14, 2017.

  1. BPearson

    BPearson Well-Known Member

    So let's start with a deep breath and a moment of reflection; even with consolidation, Sun City will not collapse and die. There's no question with the higher waste water bills, some in our community will feel the bite. In reading the ALJ's decision, it appears there will be a program for those financially strapped to get some relief. How much and for how long is a bigger question.

    For those of you unaware, the Arizona Corporate Commission (ACC) yesterday voted by a 4 to 1 margin for EPCOR to merge the 5 waste water districts into one. The net will be over the next 5 years Sun City and Youngtown will see their waste water bills basically double $22/$44(and that's before any increases they apply for over the next 5 years).

    Sun City, Youngtown and Sun City West make up by far the largest number of connections and the number of users. We also have, by far, the lowest waste water rates. Primarily because Sun City and Youngtown use the Tolleson treatment plant and the rates we pay reflect our actual costs.

    EPCOR, the ACC and apparently the ALJ all felt the best way for everyone to be happy was for Sun City and Youngtown residents to subsidize the others. EPCOR came to Sun City a couple of times with the dog and pony show trying to convince us what a great deal this would be for us...it fell on deaf ears.

    In the end, it mattered not, the slide was greased, and now we will pay. The only alternative is whether we appeal it. the Sun City Home Owners Association (SCHOA) has been carrying the ball primarily through Greg Eisert. He's done a brilliant job, but the cards were and still are stacked. SCHOA will work with legal experts to get a feel for whether the appeal (which must be filed within 60 days) is worth pursuing. If so, there will be a massive fund raising effort to try and put the 60 K needed together.
    If the odds of winning are bad, there's little value in throwing good money after bad.

    in a curious side note, yesterday i saw a news clip on channel 12 where they were trying to get comments from developer George Johnson. He's one of the litigants in the Gary Pierce trial for the massive increases in waste water charges. Interestingly enough there was also an interview with ACC commissioner Andy Tobin who was being grilled about paying back all of those users who had been screwed when the ACC voted for the huge hikes. Karma is a bitch eh?
     
  2. Cynthia

    Cynthia Well-Known Member

    I hadn't considered before that the cost increase would not only be for individuals but for all the rec centers as well. We know what that means with the eventual doubling of all those costs.
     
  3. aggie

    aggie Well-Known Member

    I'm not certain, but I believe this rate case was for residential users only. There has been no outcry from business/commercial property owners so maybe they have rates that aren't affected?

    I did listen to the whole 4 hour ruling yesterday and felt we had a pretty weak case as presented. It is unfair to residents in the Sun City/Youngtown service area but the other districts truly got the shaft from EPCOR and won't see the end result of fair rates for years.:upset:
     
  4. BPearson

    BPearson Well-Known Member

    Just curios aggie; where did you listen to it and is it on line somewhere?

    For anyone interested, here's a link to the ALJ's findings. Be forewarned, it is 250 pages plus.

    There is compelling argument in it, but it is far from one-sided. Greg has done a great job of presenting the reasons why this should not take place. Here are two cuts from of his testimony that are particularly good:
    Here is a link to it.

    For more than 100 years, cost -of-service regulation has been the fundamental basis for
    setting rates for regulated utilities. Cost of-service regulation is the most basic tool that
    regulatory authorities use to set rates for monopoly utilities. The goal is that rates should
    be no higher than required to ensure that the utility is allowed a reasonable opportunity to
    earn a reasonable return on and of its investment dedicated to public service.
    Rate making is comprised of two major activities: cost of service and rate design. Cost of
    service is an objective mathematical exercise – Rate Base x Allowed Rate of Return, plus
    Expenses.

    Once the utility’s revenue requirement is determined, a cost-of-service study is
    performed. A cost-of-service study apportions the total utility costs among the various
    customer rate classes in a fair and equitable manner using established cost of service
    standards. The cost-of-service study operates on the principle that the rate class within
    the district, which receives a particular service and causes the associated costs to be
    incurred, should pay for that service. From there, historically proven rate-design
    principles are used to create reasonable and sustainable rate designs. Departing from
    established cost of-service and rate design principles lead to prices that do not
    correspond to the way utility costs are incurred.


    CONSOLIDATE EPCOR’S WASTEWATER DISTRICTS?
    Yes. Just six years ago,the Commission unanimously rejected consolidation of
    EPCOR’s water and wastewater districts (Decision No. 72047 at 84:15-24):
    Each case considering rate consolidation must be considered independently
    based on the facts and circumstances of the particular case. ... After careful
    consideration of the facts and argument presented by the parties, we decline to
    order the implementation of consolidated rates for the Arizona-American districts
    at this time.



    Look, i get it, people in outlying areas are getting screwed...they just are. The fact is Sun City is paying exactly what we are supposed to be paying based on our actual costs. It was how it was supposed to work. That is until builders ran off to find cheap land that ultimately would lead to expensive utilities. Now the solution is for us to subsidize them.
     
    Last edited: Jun 14, 2017
  5. aggie

    aggie Well-Known Member

    I've often watched live feeds or archived videos of ACC hearings, meetings or workshops. I know.....very nerdish. The website is: Arizona Corporation Commission and down to the right is the link to "Live Feeds/Archives". It may take a day or so to have yesterday's proceedings uploaded.

    I do agree that Greg's work has been extensive and so many great points were made on his part. Mike LeVault, Mayor of Youngtown, also gave very good input yesterday. The ACC had their minds made up and nothing said was going to change it.
     
  6. Ida Eisert

    Ida Eisert Guest

    If you read the hearing evidence particularly the briefs it does not match the ROO. The Administrative Judge's opinion, at best, wrote it as a progressive and was bias. This made it easy for the Commissioners with a backdoor agenda to make the decision they did. Commissioner Bob Burns got it right with his no vote.
     
  7. Cynthia

    Cynthia Well-Known Member

    What do you mean by this?
     
  8. Ida Eisert

    Ida Eisert Guest

    Everyone pays the same price regardless of the pain. "Redistribution of wealth"
     
  9. BPearson

    BPearson Well-Known Member


    The ALJ simply followed the lead of EPCOR and the 4 republican ACC commissioners. If anyone is to be blamed Ida, it's your right wing buddies who are taking a page from the socialist manifesto, or s the communist manifesto? Damn, i always mix them up, especially when labeling our friends on the right.

    The ALJ was nothing but a pawn in an ugly game of screw sun city.
     
  10. SCR

    SCR Active Member

    Are we screwed?

    If we do nothing, nothing will change – so yes, we are screwed.

    The thousands of letters, emails, and phone calls to the ACC were mostly “We are on a fixed income”.
    That argument has never worked in the past and is never considered in rate making cases. I tend to agree with proponents of full consolidation that everyone is on a fixed income (except Donald Trump). Whether you work or are retired you do have a fixed income.

    The ACC has addressed that issue somewhat in that there is an amendment to the decision that instead of 5.00 a month credit for low income rate payers, it will be changed to 10.00 a month. However, getting that credit will require the rate payer to jump through hoops to get it.

    If I read the ALJ’s decision correctly, she made note of legal reasons why there should be full consolidation.
    Legal reasons will always out way “We are on a fixed income”. The legal reasons must be researched and contested in any appeal process.

    Consulting with legal experts as to the feasibility of an appeal is definitely a good idea, but since there are only 60 days to appeal the ACC’s decision, time is of the essence. Even if the experts say “sure there’s always a chance you will prevail” the fund raising will be an issue. Getting people who cry “fixed income” to donate 15.00 (or any amount) will be a huge undertaking.
    How do you reach each and every Sun City and Youngtown rate payer and solicit donations? When EPCOR had their dog and pony show there was a significant turnout because people were concerned about their pocketbook and the events were free. Now that the ACC has made their decision and rate payers know that their waste water rates are going to rise, I suspect that requests for donations will be met with frustration. I for one am prepared to donate as I believe that an astute group of lawyers can overturn the ACC’s decision.

    “Everyone should pay the same rate for the same services” was another argument that swayed the ALJ and ACC. Do we get the same services as the other districts? Probably not. The other districts had infrastructure and waste treatment plants built to service their districts which we have no use of and receive no service from. Granted, their infrastructure is newer, but that does not mean that it will last any longer than ours has already. In fact, in light of the fact that anything built today is built with a throw away mentality I would wager that waste water infrastructures in the newer districts will fail before ours. Has anyone heard of any waste water infrastructure repairs in Sun City? I haven’t.

    I am by no means an expert on any of this but I think doing nothing gains nothing.
     
  11. Cynthia

    Cynthia Well-Known Member

    Medicare and other services are also redistribution. But this is a redistribution of money to stock holders of Epcor, not exactly a progressive idea. Four republicans are responsible for passing this.
     
    Last edited: Jun 15, 2017
  12. BPearson

    BPearson Well-Known Member

    This discussion got me reading numerous articles on utilities and whether we were better off privately owned or run by the municipality they operated in. The net was either can be a positive or a negative, but both depended on how they were managed. Clearly the delivery of water, electricity and in some cases cable, they are monopolies. We are held captive to pay whatever they are able to charge.

    The solution years back as municipalities got out of the business was to create government agencies to regulate them. In AZ it was the Arizona Corporate Commission (ACC). And for years it worked really well. Over the past 5 years we have watched "dark money" become the key to getting elected. Candidates that took the money got elected, guys that didn't faded into the sunset. It is a travesty because at stake is the public interest.

    In the case of Sun City and the consolidation issue, we know 6 years ago it was rejected out of hand. Today it was passed by 4 republican's who simply wanted to placate the minority at the expense of the majority.

    It's pretty simple to understand: Those folks living in outlying areas have been gauged as builders sold them a bill of goods. Once they left, prices for services skyrocketed and those living there felt cheated. Sadly, they were and the solution was to pit community against community. Something EPCOR longed for and the current group of commissioners gladly promoted.

    It's a tragic display of a commission bought and paid for by the utility companies, and in the coming years all of us will pay for it through our monthly bills. I have no idea if it makes sense to try and fight this legally. SCHOA has competent attorneys weighing the decision. In the end if the odds are bad, there is no sense in throwing good money after bad.
     
  13. Ida Eisert

    Ida Eisert Guest

    The reason for taking this risk is how much you believe the decision was unjust. In my opinion, I believe it was unjust and sets a precedence for the ACC to take a direction of force on other decisions they will make in the future.
     
  14. Cynthia

    Cynthia Well-Known Member

    They're only asking for $15. But I wish they would allow credit card or paypal. Seems like they want a check only. I procrastinate writing a check.
     
    Last edited: Jun 17, 2017
  15. Ida Eisert

    Ida Eisert Guest

    They accept both credit card or paypal. You have to call it in at 623-974-4718 or go to SCHOA on 10401 W Coggins Drive to do this as far as I know.
     
  16. Cynthia

    Cynthia Well-Known Member

    Thanks I'll do that.
     

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