To the Members of Community Water Company of Green Valley
We have applied to the Arizona Corporation Commission (ACC) requesting authorization to obtain financing and a rate adjustment. Our efforts are to maintain the reliability of the delivery of drinking water and a sustainable water supply and address ongoing repairs and maintenance needs.
As a nonprofit water utility, we do not have investors or shareholders and have limited access to pursue grants. When we are growing, our initial capital comes from developers through advances and contributions in aid of construction; currently, we are nearly fully built out. Loans and water delivery rates are our principal source of funding to maintain and replace the aging water delivery system. Our goal is to ensure continued reliable water delivery service and to maintain financial stability.
Loan Request:
On July 23, 2024, the Company filed an application seeking approval from the ACC to obtain a $2 million loan from a bank within the next few months. This loan will be applied to fund capital improvement projects, including:
- Rehabilitation of existing wells
- Replacement of aging water transmission facilities
- Upgrades or replacements of transportation equipment and IT systems
These investments are critical to ensuring long-term stability, help address immediate needs, and ensure that we can continue providing reliable water delivery.
Rate Increase Request:
On August 16, 2024, the Company submitted an application to the ACC requesting approval for a rate increase based on our 2023 financial results (the “test year”). The previous rate adjustment, which used 2014 as the test year, took effect in September 2016. The proposed increase would raise the average residential bill using 3470 gallons from $21.58 to $26.71, a proposed increase of $5.13 per month. Despite the nine-year gap between test years, the resulting average monthly bills remain among the lowest compared to similar water service providers. The current request will be reviewed over the next several months and, if approved, will be implemented in late 2025.
The proposed increase is necessary to address rising operating costs in several key areas, including:
- Increased borrowing costs
- Higher electricity and water treatment expenses
- Challenges in attracting and retaining qualified staff due to competitive wage demands
- Increased regulatory compliance costs
Next Steps:
The review process for both the loan and rate increase will take time, and we will keep our members informed as updates become available. A public notice regarding our application is available for your review in the News and Updates section of our website.
Tom Cooke, Chair of the Board Arturo Gabaldón, General Manager and President