Troubled water company seeks rate increase
WILHOIT - Wilhoit Water Co.-Thunderbird Meadows wants to increase its rates, but the Arizona Corporation Commission staff is recommending an increase 95 percent less than what the utility desires.
Wilhoit Water Co. serves 128 customers in this tiny town 14 miles southeast of Prescott. Wilhoit Water owner David Conlin said money from the increase will go toward fixing the company's failing system.
During an open meeting with ACC commissioners Kris Mayes and Gary Pierce, about 40 residents aired their concerns about the private company's improvement plans.
"There are 350 private water companies in Arizona, and this is clearly one of the most problematic I've seen at the commission," Mayes told the audience. "Our goal is to get this situation resolved. You deserve a good water supply."
In a 16-page memo, ACC staff recommends a 4.89 percent increase for the typical customer, boosting the average monthly bill by $1.28, from $26.16 to $27.44.
However, Wilhoit Water Co.-Thunderbird Meadows consultant Jim West told the commission it wants a
100 percent increase, which would bring a customer's monthly bill to $52.40.
The company wants a greater rate for system maintenance and to pay for a well it dug after its latest rate increase in 1992. It also is seeking a modest return on its investment because operating costs have increased over the past 15 years, the staff report states.
"We haven't had a rate increase for nearly 20 years, so we're losing money every year," West said.
Mayes said if the company had asked for a rate increase sooner, it would have been able to repair dysfunctional pipes, well and storage tanks over time.
In 2006, the company drilled a well that commission staff members say is not useful and is not interconnected with the water system. Thunderbird Meadows wants a $15,000 reimbursement for the failed well, but staff has recommended the commission deny the request.
"The southernmost part of the subdivision's property is only producing about two to four gallons of water per minute," West said.
Mayes said the company's biggest problem is that its wells are not producing any water.
"In the summertime, the wells are coming up dry," she said.
ACC staff members say the company needs to dig a new well, which would cost about $100,000.
To keep the water flowing through its system, Wilhoit Water has been buying up to 400,000 gallons of water per month from Sam duBois, president of the nearby Walden Meadows Community Co-op.
Walden Meadows serves 306 customers on the west side of Highway 89 opposite Thunderbird Meadows.
DuBois told the commission that Wilhoit Water violated the contract this past May and June.
Walden Meadows operates a well that produces about 200 gallons per minute in the Bill Williams Aquifer just a mile south of Wilhoit's ailing well serving Thunderbird Meadows.
"We're hoping for them to become self-sufficient and relieve the burden on our system," duBois said. "The well is getting tired and losing efficiency."
"This is an issue, and we need to resolve this once and for all before next summer," Pierce said. "We would like potable water flowing by then."
In addition to the woes of the Thunderbird Meadows system, commission staff members said the company owes $79,614 in back taxes as of Oct. 23.
Staff recommends that the company's rate increases not take effect until the month before Wilhoit Water and the Yavapai County Treasurer's Office figure out how the company will pay its delinquent property taxes.
On Thursday, some customers said they should not have to pay for the company's debt through a rate increase.
Liz Wolford, a Wilhoit Water Co. customer since 1995, said some customers have had consistent problems with low water pressure. She added that smelly, murky-colored water flows through the pipes at her home.
Over the summer, Thunderbird Meadows was under an ACC Stage 4 water alert, which established mandatory water-use restrictions.
"The system is losing a lot of water and the water we have stinks," Wolford said. "Something has to be changed. We've got filters and it still smells."
Customers in Thunderbird Meadows can call, write or e-mail letters to the commission about the staff report by 4 p.m. on or before Monday.
Call the commission at 1-800-222-7000 or log on to www.azcc.gov for more information. The commission is located at 1200 W. Washington St. in Phoenix.
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