Residents Protest Water Bills

Mesa del Caballo seeks explanation as trucks rumble down streets


Mesa del Caballo resident Steve Gehring shows a photo of a mystery well that supplied half of the subdivision’s water before it blew up. The loss of the well contributed to a costly increase in water hauling charges.

Mesa del Caballo resident Steve Gehring shows a photo of a mystery well that supplied half of the subdivision’s water before it blew up. The loss of the well contributed to a costly increase in water hauling charges. Photo by Andy Towle. |

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The call came in on a Friday.

“We’re in Flagstaff on a church retreat and we just found out our water has been shut off due to non-payment. It’s over $130,” said Bobby Jones, a Mesa del Caballo resident.

Last month his bill was $103. The month before, only $50.

Jones owns a tiny computer repair business that makes just enough to cover his bills. The 62 percent jump in his water bill puts an unbearable strain on his budget. Last month, he said he had to decide whether to pay his water bill or his mortgage.

Jones said four people live at his house and now he worries about how it will impact his water bill when his elderly mother moves in.

“I don’t know what she’s going to do,” he said of the possibility of water shut off.

Jones is not the only Mesa del Caballo resident struggling to pay a far higher water bill since the water company started hauling Payson water to keep storage tanks full. The Arizona Corporation Commission (ACC) in its decision titled 71902 gave then-owner Brooke Utilities permission to recover the cost of hauling water from May to September after Brooke convinced the state regulators that use outstripped the capacity of the system in the summer.

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Mesa del Caballo residents at a recent meeting about water rates.

Besides Jones, Steve Gehring, owner of the Houston Mesa General Store, also struggles with the cost of water. He received a bill for $502 for the June to July billing cycle, although he used half as much water as he did for the May-June billing cycle.

Brooke Utilities refused repeated requests for information and comment.

However, the new owner of the water system, Jason Williamson of JW Holdings, has responded quickly to e-mail requests for information.

He wrote, “Please note that the primary reason for the higher charge is the reduction in the overall amount of consumption during the June-July billing cycle ... It was so unusually low that we conducted an investigation of a number of water meters to ensure reads were taken properly and the following numbers appear to be accurate ...”

That offers little comfort to Mesa del residents: If water use goes down — why do the bills go up?

To understand, Gehring offered up his bill.

Between June 20 to July 19, he used 11,560 gallons of water.

Gehring was charged the standard flat $16 fee for the meter.

Next, he was charged $1.93 per thousand gallons of water for the first 4,000 gallons of water, which totaled $7.72. For the remainder of the water Gehring used, he was charged about $3 per thousand gallons, for a total of $22.60.

So far, so good. His normal bill would have totaled about $46 for just over 11,000 gallons.

But wait: Now comes the kicker. The bill includes an augmentation fee of $424 to cover the cost of trucking enough water to keep the storage tanks full.

All perfectly legal and logical according to authorities.

The ACC allows the Mesa del water company to charge augmentation fees for the summer months to cope with the influx of summer visitors, which pushes the water system to its limits.

The increased demand empties storage tanks and increases the strain on well production, say water officials. To keep the water flowing, Brooke Utilities trucked in water from the Town of Payson water system by filling trucks at a water main behind Home Depot. JW Holdings, the new water company, is doing the same.

The ACC allows water companies to charge for trucking in water to cover their costs, but companies must go through a hearing process. Robert Hardcastle, owner of Brooke Utilities did just that and so won the right to charge for augmentation fees in 2011.

In its decision 71902, the ACC stressed that water supply management is up to the company.

The ACC-approved augmentation charge is based dividing the total monthly cost of the trucked water (trucking + water) into the total amount of water sold for the month — including the water that came out of the wells.

For the June-July billing period, Williamson reported residents used 993,050 gallons, 664,125 of which the company trucked into Mesa del.

Many residents question the amount Williamson trucked. However, during that period the system lost a well that normally produces more than half of the water in the system.

The well owned by Mary Hansen was shut down for three weeks during the June-July billing period, which forced Williamson to truck in more water, he said in a July 22 e-mail.

Brooke Utilities had allegedly used water from Hansen’s well without payment or testing for years before she bought the property in foreclosure and discovered the well was hooked up to the system. Williamson has since struck an agreement with Hansen to pay for water from the well.

“The reason why the augmentation charge is higher is due to less water being sold because when there are fewer sold gallons into which the hauling costs can be divided the resulting cost per gallon rises commensurately,” wrote Williamson.

In short, the loss of Hansen’s well meant that the water company had to haul two-thirds of the water used for the month, driving up the per-gallon augmentation fee.

It remains unclear whether the ACC set a limit on how much the water company may charge for water hauling. Documents on file with the ACC seemed to show a maximum allowed charge of $33.68 per thousand gallons. But a ACC spokesperson contacts by the Roundup said the maximum charge was just over $30.

However, when contacted for this article Williamson called ACC staff and that the water hauling regulations don’t actually set a limit.

The augmentation charge on bills provided to the Roundup showed augmentation charges as high as $36.70 per thousand gallons.

In an e-mail, Williamson said the ACC staff told him that he could charge enough to cover actual costs for hauling water.

“(The ACC) based their comments on projections of use, consumption, production and other factors that influence water consumption. The adopted tariff places no restrictions of the amount charged because it is a cost-recovery mechanism. The Commission does not expect Payson Water Company to provide services without at least covering the costs to supply the water. That’s the purpose of the water augmentation surcharge.

“It is possible that the Company and ACC staff projections found in 71902 are in error.”

Fortunately, this could be the last summer Mesa del residents face the stunning charge.

Late this year, Payson expects to complete a pipeline extension to the site of a treatment plan for the Blue Ridge pipeline. That will bring Payson water to the edge of the unincorporated subdivision. It would then be an easy detour to send a pipe into Mesa del to deliver water directly even before the Blue Ridge pipeline reaches the treatment plant in 2014 or 2015.

Since the trucked water comes from the Town of Payson anyway, the town could then provide water to Mesa del without the cost of the trucks.

Payson has been selling the water to first Brooke Utilities and now Williamson at the same rate as it charges Payson residents. A decline in population and water use has left Payson with more water than it needs, even before the arrival of Blue Ridge water.

Once Mesa del residents connect to the actual pipeline, average water bills should rise 50 to 100 percent — to cover the cost of buying into the pipeline. However, that should eliminate the need to ever haul water again, even if Mesa del’s water use rises as people build on empty lots.

Williamson is cautiously hopeful that the Payson connection will solve the problem.

“(It) depends on a number of factors, namely the status of our rate case and financing application at the ACC which would be necessary before we proceed with this work. I will say that it is our hope to connect to the TOP source to avoid hauling costs as soon as possible.”

Ass for Jones and his family, JW Holdings agreed to spread his payments out over the next three months and his water is back on again.

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