"Thomas Jefferson said a democracy is dependent on an informed citizenry. I don't care whether it sounds corny or not. It's the truth." -Jim Lehrer
Carefree Truth
Issue #851, August 17, 2020
Issue #851, August 17, 2020
Mayor Les Peterson explained that Carefree had registered as an intervener when Liberty Utilities requested a rate increase of over 32%. "That is very high."
The Residential Utility Consumer Office (RUCO) takes the position of residents. Along with the Arizona Corporation Commission (ACC) staff members, RUCO looks at the financial and other filings of a utility. The Town of Carefree submitted a recommendation after being told that Greg Sorenson, the previous General Manager of Liberty Utilities, said he interpreted Carefree's silence as approval of the rate request, prompting The Town to submit a written opposition.
Liberty did spend money, but the quote going in was $3,899,700. Estimates are normally in the ballpark, plus or minus 10%, and that is used to make decisions. The final cost submitted by Liberty for hard and soft costs was $11,460,881. "Boisterous discussions" between Liberty and Carefree have ended up before a judge, who asked for the basis of the dispute. Carefree is taking the position that there should be a fair and equitable settlement, but 32% is uncalled for and, the Mayor thinks, unsupported. The ACC staff recommended no rate increase and RUCO recommended a minus 1% rate decrease.
The resolution before the Council authorizes Carefree to work with RUCO, the ACC staff and others. Liberty did an excellent job of decommissioning and closing the plant, and hooking up to Scottsdale, but it has gotten out of hand since then.
Councilman Vince D'Aliesio asked when the last rate increase was done. Mayor Peterson replied, "In 2016". Mr. D'Aliesio asked the amount of the increase. The Mayor replied, "It was 15-20%". Mr. D'Aliesio said this rate increase request was uncalled for, especially now when everyone is taking financial hits due to the pandemic.
Vice Mayor John Crane added that with the surcharge, the increase would be closer to 40%. RUCO and the ACC staff are recommending 0%, leaving the rates where they are. Looking at depreciation and the return on investment in the 3 years prior to the closing of the plant, Liberty is above what the ACC would normally permit. RUCO also noted the lack of financial clarity in what was shared by Liberty to the ACC. He felt it was a strong case, and that Carefree should align with them in the interest of our residents and businesses. Mr. D'Aliesio thought RUCO was being kind when Liberty increased the rates 15-20% only 4 years ago.
The Vice Mayor said the hearing date is September 16th. He suggested that residents and businesses should visit the ACC website and express their opinions. Mayor Peterson noted that saying the rate increase is too high and the person voicing the opinion can't afford to pay for it holds no weight with the ACC. You have to get into the specific financial arguments of the history and the incurred costs. Those documents can be viewed on the ACC website. Vice Mayor Crane felt letters might still have some influence.
Councilman Mike Krahe asked if the Town should communicate to the residents what to say. Mayor Peterson explained that the Town is in the process of formulating a specific plan of action, after which it can consider communicating a program around that. It's not appropriate until that is done. Vice Mayor Crane noted that the Resolution is a strong statement from the Council. Mayor Peterson said it will be a "battle royale", but the reason they are here is to protect the residents and businesses.
With Councilman Gene Orrico absent, the Resolution was approved 6-0.
https://vimeo.com/447042304
Lyn Hitchon
Prepared by Carefree Truth
Copyrighted
Visit our website at www.carefreetruth2.com If you know anyone who would like to be added to the Carefree Truth email list, please have them contact me. Feel free to share Carefree Truth with others on your list.
Visit www.carefreeazbusinesses.com to see more info about businesses in Carefree. Please support our merchants.
The Residential Utility Consumer Office (RUCO) takes the position of residents. Along with the Arizona Corporation Commission (ACC) staff members, RUCO looks at the financial and other filings of a utility. The Town of Carefree submitted a recommendation after being told that Greg Sorenson, the previous General Manager of Liberty Utilities, said he interpreted Carefree's silence as approval of the rate request, prompting The Town to submit a written opposition.
Liberty did spend money, but the quote going in was $3,899,700. Estimates are normally in the ballpark, plus or minus 10%, and that is used to make decisions. The final cost submitted by Liberty for hard and soft costs was $11,460,881. "Boisterous discussions" between Liberty and Carefree have ended up before a judge, who asked for the basis of the dispute. Carefree is taking the position that there should be a fair and equitable settlement, but 32% is uncalled for and, the Mayor thinks, unsupported. The ACC staff recommended no rate increase and RUCO recommended a minus 1% rate decrease.
The resolution before the Council authorizes Carefree to work with RUCO, the ACC staff and others. Liberty did an excellent job of decommissioning and closing the plant, and hooking up to Scottsdale, but it has gotten out of hand since then.
Councilman Vince D'Aliesio asked when the last rate increase was done. Mayor Peterson replied, "In 2016". Mr. D'Aliesio asked the amount of the increase. The Mayor replied, "It was 15-20%". Mr. D'Aliesio said this rate increase request was uncalled for, especially now when everyone is taking financial hits due to the pandemic.
Vice Mayor John Crane added that with the surcharge, the increase would be closer to 40%. RUCO and the ACC staff are recommending 0%, leaving the rates where they are. Looking at depreciation and the return on investment in the 3 years prior to the closing of the plant, Liberty is above what the ACC would normally permit. RUCO also noted the lack of financial clarity in what was shared by Liberty to the ACC. He felt it was a strong case, and that Carefree should align with them in the interest of our residents and businesses. Mr. D'Aliesio thought RUCO was being kind when Liberty increased the rates 15-20% only 4 years ago.
The Vice Mayor said the hearing date is September 16th. He suggested that residents and businesses should visit the ACC website and express their opinions. Mayor Peterson noted that saying the rate increase is too high and the person voicing the opinion can't afford to pay for it holds no weight with the ACC. You have to get into the specific financial arguments of the history and the incurred costs. Those documents can be viewed on the ACC website. Vice Mayor Crane felt letters might still have some influence.
Councilman Mike Krahe asked if the Town should communicate to the residents what to say. Mayor Peterson explained that the Town is in the process of formulating a specific plan of action, after which it can consider communicating a program around that. It's not appropriate until that is done. Vice Mayor Crane noted that the Resolution is a strong statement from the Council. Mayor Peterson said it will be a "battle royale", but the reason they are here is to protect the residents and businesses.
With Councilman Gene Orrico absent, the Resolution was approved 6-0.
https://vimeo.com/447042304
Lyn Hitchon
Prepared by Carefree Truth
Copyrighted
Visit our website at www.carefreetruth2.com If you know anyone who would like to be added to the Carefree Truth email list, please have them contact me. Feel free to share Carefree Truth with others on your list.
Visit www.carefreeazbusinesses.com to see more info about businesses in Carefree. Please support our merchants.