Policy: Environment & Energy

Judge rules for San Diego in major water dispute

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News,Business,California,Energy and Environment,San Diego

SAN DIEGO (AP) — A judge said Tuesday that a giant Southern California agency overcharges for carrying water on the Colorado River aqueduct, a major victory for San Diego in a high-stakes dispute.

San Francisco Superior Court Judge Curtis Karnow said Los Angeles-based wholesaler Metropolitan Water District of Southern California incorrectly set rates to bring water from the Colorado River to the coast on its 242-mile aqueduct from 2011 to 2014.

The San Diego County Water Authority, Metropolitan's largest customer, sued in 2010 over the transportation costs, claiming Metropolitan was using a windfall to subsidize millions of other customers in Los Angeles, Orange, San Bernardino, Riverside and Ventura counties. Karnow's 66-page ruling followed a December trial.

A second phase of the massive trial will address, among other questions, whether San Diego gets a refund. Dennis Cushman, the San Diego agency's assistant general manager, said disputed overcharges from 2011 through 2013 total $135 million.

It's too early to estimate the ruling's impact on households, Cushman said, but the San Diego agency claimed it was being overcharged between $1.3 billion and $2.1 billion over 45 years. It claims it was overcharged $57 million in 2013, translating to $73.60 in extra costs for an average household of four.

Jeffrey Kightlinger, Metropolitan's general manager, said Tuesday that the rates were "both logical and legal" and called the ruling "one step in a very long process."

"We look forward to the coming steps in the judicial process to demonstrate that a rate structure that fairly and equitably recovers all the cost of delivering safe, high-quality, and reliable water is in the interest of all Southern Californians," he said.

The San Diego County Water Authority, which supplies the city of San Diego and 23 suburbs and water agencies, ended its complete dependence on Metropolitan after a drought tightened the spigot in the early 1990s. It began a costly effort to diversify supplies that includes construction of the Western Hemisphere's largest desalination plant in Carlsbad and, most significant, a 2003 agreement with California's Imperial Valley for the nation's largest farm-to-city water transfer.

Metropolitan supplied 46 percent of San Diego's water last year, down from 95 percent in 1991 but is still the city's largest supplier. By 2020, it will supply only 30 percent. There's just one catch: San Diego needs Metropolitan's aqueduct to get the water it buys from the Imperial Valley.

San Diego agency officials celebrated the ruling at a news conference Tuesday night.

"Clearly, what Metropolitan was trying to do here was to keep the golden goose in the henhouse and keep us captive to their rate-making power," Cushman said.

The dispute has been unusually acrimonious. In 2012, the San Diego agency launched an unusual public relations offensive with a website that alters its largest supplier's official seal to read, "The Truth About Metropolitan Water District of So. Cal."

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