Pending Bill Jeopardizes Water District Rate Adjustment.The sweeping rate restructuring being formulated by the Metropolitan Water District of Southern California The Metropolitan Water District of Southern California is the largest bulk water supplier for municipal use in the world. The name is usually shortened to the "Metropolitan Water District" or simply "MWD". and scheduled to take effect next year may be derailed by a bill now making its way through the state Legislature A state legislature may refer to a legislative branch or body of a political subdivision in a federal system. The following legislatures exist in the following political subdivisions: As deregulation Deregulation The reduction or elimination of government power in a particular industry, usually enacted to create more competition within the industry. Notes: Traditional areas that have been deregulated are the telephone and airline industries. slowly comes to the water industry, the pending legislation could force the MWD MWD Metropolitan Water District of Southern California MWD Measurement While Drilling (oil drilling) MWD Morgan Stanley Dean Witter (stock symbol) MWD Molecular Weight Distribution MWD Military Working Dog to slash the rates it wants to charge for third parties that transport water through its pipelines. The bill, SB 1029 by Sen. Don Perata Don Perata (born April 30, 1945) is a California Democratic politician, who is the current President pro tempore of the California State Senate. He was elected to the post of President Pro Tempore in 2004. , D-Oakland, requires water pipeline system owners like the MWD to charge third parties only for the cost to transport the water through their pipelines and prohibits them from adding a charge to help cover costs for overall maintenance of the water system. The bill passed the Senate Agriculture and Water Resources Committee last week on a unanimous vote and moves on to the Senate Appropriations Committee In the United States government, the Appropriations Committee can refer to either:
The MWD has mounted an intense lobbying campaign against the bill, saying it would leave the agency in a situation similar to the state's investor-owned utilities that are now insolvent INSOLVENT. This word has several meanings. It signifies a person whose estate is not sufficient to pay his debts. Civ. Code of Louisiana, art. 1980.. A person is also said to be insolvent, who is under a present inability to answer, in the ordinary course of business, the responsibility because they were unable to pass on their wholesale power costs to ratepayers. "This bill doesn't learn from the mistakes of power deregulation," said MWD spokesman Adan Ortega. "Agencies must recover the costs of providing access to their systems. If they can't cover their costs, they face possible insolvency insolvency Condition in which liabilities exceed assets so that creditors cannot be paid. It is a financial condition that often precedes bankruptcy. In the context of equity, insolvency is the inability to pay debts as they become due; insolvency under the balance-sheet and you will see a suppliers' market." Perata was unavailable for comment last week. But supporters of his bill said its intent is to prevent the MWD or other water pipeline owners from imposing "unreasonable" costs on third parties seeking to transport water through the pipes. They said it's all right to have some additional costs, such as a fee for the maintenance of the individual pipeline through which the water is transported. But, they argue, a third-party water transporter should not have to pay for other budget items, like the MWD's headquarters building or that agency's lobbying expenses Noun 1. lobbying expense - expenses incurred in promoting or evaluating legislation; "many lobbying expenses are deductible by a taxpayer" disbursal, disbursement, expense - amounts paid for goods and services that may be currently tax deductible (as opposed to . "The costs must be within reason and have justification," one supporter said. The Perata bill is only the latest chapter in the long-running battle over the shape of the state's water market, as deregulation begins to take hold. For each of the last several years, private water suppliers and some public water agencies have been pushing for minimal fees for access to existing water pipelines. Each time, the MWD and other water agencies have successfully fought off these attempts, arguing that they should have the right to set the water transfer fee at a level that covers system-wide maintenance costs. Two things have changed the landscape this time around, however. One is the failed power deregulation scheme that has water agencies and some Sacramento lawmakers extremely wary of deregulating de·reg·u·late tr.v. de·reg·u·lat·ed, de·reg·u·lat·ing, de·reg·u·lates To free from regulation, especially to remove government regulations from: deregulate the airline industry. the water market, the other is that the MWD is just about ready to unveil its new rate structure that addresses the issue of third-party water providers. The chief component of this rate proposal - which could take effect as early as next year - is what the MWD's Ortega calls a "uniform system access charge." "Everyone who wants to use the system to transport water through the pipes must pay the same fee, whether it's MWD water or water provided by third parties," Ortega said. 'That fee covers the cost of the MWD's investments in the water system and of water conservation programs we've put in place." |
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