YERMO Yermo residents packed the Yermo Community Service District office Tuesday night to express their concerns about a proposed rate increase that would hike an average customer's bill by about $40 a month.

The California Public Utilities Commission is considering a request by the Yermo Water Company to raise rates in Yermo for the first time since 1993, at the same time as the commission is looking at taking the operation of the company from owner Don Walker and handing it to a court-appointed receiver.

The new proposed rates would raise an average customer's bill from $29.10 to $70.37 a month, said Moe Kazemzadeh, the PUC's project manager for the rate case.

Some customers present at the meeting acknowledged that they have seen improvements in the Yermo Water Company system in recent years, but others continued to complain of poor water pressure, out-of-commission fire hydrants, bad taste and smell, and leaking lines.

And although the California Department of Public Health now certifies that the water is safe to drink, residents said they have not forgotten the past health advisories requiring them to boil their water or the shut-off that left them without water for three days in July of 2006.

The new rate will be calculated to cover the company's operating expenses, but PUC policy prevents the rate from including money for future system improvements, PUC water and sewer advisory branch chief Fred Curry said.

Work papers submitted by the water company to the PUC estimated its annual operating revenues to be $105,355, while expenses were projected to be $306,328. Company owner Don Walker, who came in from Florida for Tuesday's meeting, said he has put about $150,000 of his own money into the company.

As well as concerns about the quality of the water service, residents raised concerns that the rate increase will put an unreasonable burden on the predominantly low-income Yermo community.

"I'm very much against it, but if retirement was raised that much 300 percent they could do that," said Paul Hanson after the meeting.
Resident Ed Rosa said he would not be opposed to raising the use charge, since customers can control how much water they use, but thinks the flat monthly service charge should be left alone.

After a PUC investigation into the Yermo Water Company's practices, an administrative law judge recommended April 6 that the commission hand the company to a receiver to be appointed by the San Bernardino Superior Court. The receiver would operate it until the court chooses a qualified buyer to take it over.

In the meantime, the Yermo CSD is hoping to get its water powers reinstated and negotiate a deal to buy the water service before the court proceedings potentially drive the price higher.

Yermo resident Joe Orawczyk, who works for a government contractor but has previous experience as a plumber and water treatment operator, said he is hoping to see the Yermo CSD take over the water system.

"My opinion is any time you privatize a human right, which I think water is, you're telling people, 'If you don't pay your bill, we'll cut off your water, and you can die or whatever,'" he said.

Curry said if the rate increase passes, the PUC will look at ways to phase in the new rates or to work out some type of subsidy for low-income rate payers.

He expected to finish a staff report with the rate increase he will recommend to the commission within the next four weeks. The report will then go through a 30-day comment period before going to the commission for a vote.

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