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California-American Water: Felton system is not for sale

California-American Water: Felton system is not for sale


Many residents want SLV district to buy system rather than see
it sold to conglomerate

November 17, 2002
Sentinel staff writer

The company that supplies water to 1,315 customers in Felton
doesn’t want to sell.
That will come as a disappointment to the many Felton residents who
would rather have the San Lorenzo Valley District take over their
water system than have it sold to a huge German conglomerate.
“Our system is not for sale,” said Kevin Tilden, spokesman for
California-American Water, which is part of American Water Works
Co., a firm with operations in 22 states that is about to be acquired
by RWE Aktiengesellschaft of Essen, Germany.
Tilden said American Water Works has made “many positive changes”
since taking over the Felton system in January and “we’d like to have
a chance.”
He contended the company could provide water at lower cost than
the San Lorenzo Valley agency because of economies of scale.
“We have 165,000 households in California,” he said. “We can send
out bills cheaper. We can buy chemicals cheaper. We can answer
phones cheaper.”
County supervisor Jeff Almquist, a Cal-American customer, isn’t
buying that argument.
He’s going to San Francisco on Wednesday to talk with officials at
the California Public Utilities Commission about Cal-Am’s rate hike
Almquist wants the state to require a hearing in Felton to take
evidence from customers about service problems that have arisen
since Cal-American took over before deciding on the rate hike.
Meanwhile, the San Lorenzo Valley Water District board has
authorized spending up to $75,000 for an appraisal of the Cal-Am’s
facilities in Felton, which include springs and a treatment plant.
Directors Terry Vierra, David Ross, Jim Rapoza, and Jim Nelson
approved the expenditure, and appointed Ross and Rapoza to a
subcommittee to update the county and the public. Director Larry
Prather was absent for that vote.
A takeover would involve a complicated bureaucratic process.
The water district can’t go to court on its own to acquire the Felton
assets through eminent domain because Felton is outside its “sphere
of influence.”
So the first step would be for the water district to apply to the Local
Agency Formation Commission, which decides boundary issues, to
expand its territory. Before making a decision, LAFCO staff must
prepare a study analyzing whether a full environmental review of the
proposed change should be conducted. The study could take an
estimated six to eight months.
“Basically, they have to decide whether it’s in the public interest,”
said Scott Millar, an aide to Almquist.
If LAFCO director Pat McCormick is busy with other issues, a
consultant could be hired, Millar said.
County officials are preparing to go to court. They are considering
hiring a law firm experienced in eminent domain rather than relying on
the County Counsel’s Office, which has little experience with the
A likely choice is the law firm representing the Montara Sanitary
District, which has 5,500 customers just north of Half Moon Bay. The
Montara district hired an appraiser to assess the value of the water
system there and a court ruling is expected in March.
Tilden, the Cal-American spokesman, contended the purchase would
create an “unnecessary burden on taxpayers.”
But Juliette Beck of the nonprofit lobbying group Public Citizen said
American Water Works has tried the same argument in other states
where critics oppose German acquisition.
Ben Lomond activist Tod Landis is working with Public Citizen to
network local opponents with a half-dozen other communities fighting
the German firm’s takeover.
For information, check the Web at or
e-mail jbeck (at)
Contact Jondi Gumz at jgumz (at)


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