≡ Menu

Think your Cal Am bill is big now? Just wait


Cal Am sign at job site

The sign declaring “Your water bill at work” is, in the eyes of water activist Michael Baer, a big, fat lie.

It is posted at a worksite in Monterey where crews are installing a 36-inch water transmission line that eventually will be used to transport Cal Am water.

The problem, says Baer, is that the bills paid by Cal Am customers for the most expensive water in the country do not yet include the costs of the pipeline. That cost was originally estimated at $40 million but the pricetag has since risen to $53 million. What that means, Baer says, is that it is future Cal Am water bills that will be paying for the work. In other words, another rate increase.

In recent years, Cal Am has been authorized to charge more and more, sometimes just to maintain its profit margin and at other times for special reasons. For instance, Baer noted, the current bills include the cost of removing San Clemente Dam, which had silted up because Cal Am failed to maintain it. They also include a $40 million-plus award to Cal Am to cover the cost of water that wasn’t used because of conservation efforts by customers.

“Our water bills, the most expensive in the country according to Food & Water Watch, do not reflect a single penny collected towards paying for the Monterey pipeline costs,” Baer said.

Also still to come on water bills are incomplete slant well test as part of Cal Am’s desalination project. That 27-month test was initially pegged to cost $4 million. It’s around $16 million now, Baer said.

And then, of course, added on to the water bills will be the cost of the desalination plant itself. Early on, it was estimated to cost $280 million. Regardless of whether it ever gets built, the state will enable Cal Am to bill customers for its expenses.

Michael Baer is a retired public school science teacher,  a 30-plus year resident of the Monterey Peninsula, and a water activist.

Comments on this entry are closed.

  • STEPHEN MILLICH July 24, 2017, 5:38 pm

    Public ownership of a public utility is desirable. However, what competent public agency is available to operate the utility and where do we obtain the funds to purchase it or acquire it by eminent domain from Cal Am? Without answering these two questions public ownership is just a pipe dream.

    • Michael Baer July 24, 2017, 6:20 pm

      Public Water Now (PWN) will be collecting signatures to place the acquisition initiative on the ballot for the November 2018 “mid-term” election. It will identify the Monterey Peninsula Water Management District (MPWMD) as the agency to run the water company for two main reasons. They are already chartered to do so, and the CalAm district and MPWMD district overlap to a large degree. The money to acquire will come from a public bond which can be paid over time by the profits and corporate taxes that CalAm collects, but which won’t be required by public ownership. That is estimated to be in excess of $20 million per year currently, which will be enough to pay off the bond without raising rates further. And at the end of the bond term, the community will FINALLY own its own water company, lock, stock and barrel. Stay tuned.

      • john moore July 24, 2017, 9:25 pm

        MPWMD is the agency responsible for the entire water mess. It was its charter to protect us from a water shortage. It must be left out of any take-over, or, future management of our water company.
        Granting ownership of the desalination plant to CalAm is historic for its stupidity. There are plenty of villains: the mayor’s group, County Counsel’s “pants on fire” legal opinion circumventing the law that ownership must be by a public entity, but no agency can challenge MPWMD for incompetence, except for PWN, if it pushes for MPWMD to manage our water company after a buy out.
        The only plan is a Joint Powers Agency of all of the cities w/i the Cal Am district to own and manage the water company. Its elected Directors, pursuant to a Request For Qualifications should contract with a company expert in managing a water company. Thereby, the ugly politics of the Bay area, the politics that placed us in this precarious financial condition, can be avoided. Let’s quit rewarding the incompetent agencies that got us into this mess.

    • Dan Turner July 25, 2017, 9:43 am

      Most everything that Steph and John have said about the WMD is true but we are stuck w/them as our go-to agency whether we like it of not. We have looked into the formation of a new JPA but it just can’t be done unless you have existing public agencies or governments (cities, counties) that want to do it – and we don’t. We can’t just go out and form a JPA on our own.
      The best option, right now, would be for the WMD to just vote to fund the study that our state law says must be done before a community can jettison its private utility in favor of a public agency. The study has to show that it would be “in the public interest” (which means less expensive) to go public. (No worry there – it is always less expensive to go public w/utilities.) The next step, after the study, would be for the WMD to attempt to enter into negotiations w/CalAm regarding the sale of CalAm’s Monterey operation to the WMD and, if CalAm refused to sell, to initiate condemnation action against it in court. Unfortunately, the current WMD directors don’t seem to have any interest in doing that.
      So, after our successful electoral campaign to force the WMD to get rid of CalAm, we’re going to have to fight electoral campaigns to insure that we have WMD directors are in favor of public water in order to force the WMD to do what our electoral victory mandated it to do and, then, insure that we have WMD directors who will be on the residents’ side and not that of the business community so that they will promulgate rates that are fair, instead of what we have now w/CalAm, which gives the biz interests (large hotels and golf courses to name just two) much lower rates for their water than what residential users have to pay. I don’t mean to make it sound hopeless because it isn’t. It’s just that that’s the way our political system works. People w/lots of money use it to enable politicians who will support their interests to run big, glitzy electoral campaigns that often result in those cretins winning. Only by remaining politically organized and active will we be able to create and maintain a WMD Board of Directors that supports our interests, as opposed to that of the biz community.

    • Melodie Chrislock July 25, 2017, 10:51 pm

      Public Water Now Forum on Bond Financing
      Roy Nelson, bond consultant with Wulff Hansen
      Monday, August 14th, 7:00pm
      Unitarian Universalist Church
      490 Aguajito Rd, Carmel (Aguajito at Hwy 1 and 68)
      Roy Nelson will present and discuss how public bonds work, and what to expect with the process.
      Free & Open to the Public

  • Jeanne Turner July 24, 2017, 5:42 pm

    Yes, two years ago, our Cal Am water delivery system was the ninth most expensive in the country. Two years later, after a 68% increase, we are now #1! Remember, our costs do not reflect the cost of water itself for which Cal Am pays nothing. Even though ratepayers have recently seen their Cal Am bills double or even triple, the worst is yet to come. If any of you would like to join in helping to end this insanity, go to publicwaternow.org and volunteer. I am the volunteer coordinator. We are seeking more signature collectors for our petition drive as I write. We need Community Owned Water.

    • Bob Oliver July 24, 2017, 8:11 pm

      I refer you to comment number 1, STEPHEN MILLICH. Get rid of our public officials and start over. It’s time to through out the baby with the bath water. On the other hand, there never was a baby, was there.

  • david fairhurst July 24, 2017, 8:15 pm

    Royal, I didn’t know that you write with the prose of a Stephen King. I can see the future Horror movie now with trickles of water seeping into peoples bank accounts and “draining” them of all their savings. Walls of water “washing” away all that would oppose our water tyrants will. The cruel punishments of a home without water. Yes it is the evil empire of water and it’s wicked master: CALigula-AMok. Who will stop this monster? Who would dare to contest and wrest control from such wickedness as CALigua-AMok and it’s board of directors henchmen of the PUD? (also known as the knights of Perdition, Usurping, Depravity. The only beacon shining it’s light for justice and truth is here, at The Partisan.

  • Bob Oliver July 24, 2017, 8:21 pm

    In order for us to become the highest paying water customers in the nation, collectively we have been too lazy to rally in the streets and take it inside to City Hall and confront what has been going on “BEHIND CLOSED DOORS” for so long. The corruption is now obvious. So is our collective stupidity. Take back our own governing and demand our water rights. We have been dealing with a criminal enterprise and weak minds.

  • Eric Petersen July 24, 2017, 8:53 pm

    Brace yourselves, there is more: With billions of dollars in fines and penalties, plus P G $ E control of the Public Utilities Commission, expect electric and gas bills to soar soon!

    For electricity, support Public Power and push entities like the Board of Supervisors to get things moving quickly. For gas, I now pay a small non-PG$E company for mine.

    • david fairhurst July 26, 2017, 7:52 pm

      We used to affectionately refer to it as “Pathetic Graft & Extortion”. I like “free markets” but not being extorted by my utility company who has no competitors and the full support of a progressive State.

  • Stephen Schweitzer July 24, 2017, 10:17 pm

    I wonder how much of the revenue generated here by CalAm water is to cover for their shortfalls in the Bay Area.

    • Michael Baer July 25, 2017, 2:37 pm

      Stephen, I was not aware that CalAM, a subsidiary of American Water, has any presence in the Bay Area. We are a the golden cash cow, among American Water’s other cash cows. They have roughly a couple dozen subsidiaries around the country. There are a number of CalAm districts in California, but rates vary.

      I agree with Bob Oliver, we haven’t taken it to the streets hard enough, or pressured our electeds strongly enough to represent us against the profit guzzling water company. But it’s a new day, and people have taken notice about what is happening on their water bills. Politicians need to feel the heat if people actually care about water rates.

  • sandra hummer July 26, 2017, 12:55 pm

    why are they privately held? same as the sewer in carmel. they need to be controlled by the gov city rats.

  • Donna Gilmore July 26, 2017, 1:31 pm

    Before looking to desalination, make sure they can filter out the radioactive waste created by the ongoing Fukushima triple meltdown dumping of nuclear waste into the Pacific.

    I agree with Baer. And if you have a municipal utility district you are no longer under the thumb of the California Public Utilities Commission and their kangaroo court.

  • bill leone July 27, 2017, 3:00 pm

    I completely agree with Everything that Dr. Dan Turner wrote in his comment.
    In Addition, everyone should be aware of the fact that CalAm is a long-standing member of NAWC
    (National Association of Water Companies), which in turn, is a long-standing member of ALEC
    (the American Legislative Executive Council); the organization funded by the Koch Brothers, & other large, criminally-prone corporations, & responsible for Voter Registration Restrictions, Stand Your Ground Legislation, & many other odious laws, policies & lobbying efforts.
    Remember this when you pay your water bill: a significant percentage of CalAm’s increasing profits goes towards making America less safe, more economically unequal, & more oppressive towards people of color.