A decision in the water rate case for Chaparral City Water Company in Fountain Hills is being delayed due to an investigation by the California Public Utility Commission into Golden State Water, a sister company of CCWC in California.

According to documents filed with the Arizona Corporation Commission, ACC staff received a call from the CPUC in December about that agency’s investigation into Golden State Water.

A statement filed with the ACC on June 19 updated an administrative law judge on the status of the CCWC rate request.

“The CPUC discovered information regarding (CCWC) during the course of its investigation into certain procurement practices of Golden State Water, the sister company of (CCWC),” the statement says.

It goes on to state that ACC staffers sought to receive information from the CPUC and CCWC in an effort “to determine if any alleged improprieties affect this pending (CCWC) case.”

In March ACC staff received 15,000 pages of documents from CCWC.

As of June 23 ACC staff was still sorting through the documentation and had asked for a delay in proceeding with the CCWC rate case.

The administrative law judge granted a one-week delay in hearing the case.

An attorney for CCWC filed a response with the ACC stating that staff has had three months to go over the documents and they also believe the situation requires no action by the judge.

The state’s Residential Utility Consumer Office (RUCO) agreed there has been insufficient time to review the documentation, however, it did not object to allowing the case to proceed.

“RUCO acknowledges (CCWC’s) desire to have the commission render a decision in this matter as soon as possible,” the RUCO filing states.

“Therefore, RUCO does not object to the (CCWC) suggestion that this matter proceed, but remains open subject to reconsideration in the event that the investigation by staff, RUCO and/or the CPUC reflects impropriety by (CCWC) and/or its parent, officers or employees.”

In February 2007 CPUC began looking at whether Golden State Water Company (GSWC) was overcharged by a specific contractor for numerous construction projects, according to CCWC District Manager Rob Hanford.

“The work was primarily related to water treatment and pumping plants which are in service,” Hanford said.

“The CPUC then began an audit of the company’s practices for awarding construction contracts for a period from 1994 to present. 

“GSWC has been cooperating and responding to the data requests submitted by the CPUC. We cannot predict the outcome of the CPUC’s investigation or audit at this time.”

In January the ACC staff requested information regarding the CPUC investigation and on-going audit.

“Chaparral City Water Company has been working with the ACC to provide materials relevant to CCWC,” Hanford said.

“To date, no activities have been identified to have any impact on the operations related to the Chaparral City Water Company. However, we cannot predict the outcome of the ACC’s request at this time.”

While those involved in the CCWC case appear willing to proceed with the rate case without further delay, it is at this time unclear when the Arizona commission might reach a decision.