Felton FLOW

A new problem with Cal-Am’s repair work on Highway 9 required a pump to remove water, resulting in flooding and traffic diversion recently. A Cal-Am crew was continuing workon the problem up until two hours before a PUC hearing in Felton.

NOTE: Felton Water History information 1868 to 1961 taken from The Old Felton Times, no. 1, 2/2005 and online data from historian R. Brown.

1868 – Felton town plan filed; water from Bull Creek is provided at no charge to residents courtesy of the Stanly family.

1888/1889 – After a fire which destroyed much of Felton, townspeople agree to incorporate the water system in order to better manage it. Their goal was to "hold, in trust, the water works of Felton, for the use and benefit of that village forever." The plan became a for profit corporation although the water was still free. F.A. Hihn, owner of much of Felton’s undeveloped land, played an organizing role. Stockholders provided money for pipelines, hydrants, flumes, and other items, and maintenance. Public interest was protected by a requirement that stockholders be local residents and by the corporation’s term limit of fifty years – Felton residents would have the right to start over if the corporation failed in its duties.

1917 – Felton has lost much of its population and is disincorporated.

1923 – Felton water system is purchased by George Fetherston and R.L. Young as speculation in the housing development plan for Felton Acres.

1933 – Felton’s water system fully owned by Florence and George Fetherston and reorganized as the Felton Water Company.

1961 – Florence Fetherston sells the Felton Water Company to Citizen Utilities of California, a subsidiary, for $200,000; Citizen Utilities served 800 local customers with a Boulder Creek office and no rate increase.

~1965 – All facilities except the Felton District are acquired through public acquisition with ownership passing to SLVWD.

January – American Water Works Company, Inc. acquires all of Citizens Utilities, including the Felton Water District, and pays 67% over book value. American Water Works owns California American (Cal Am) who operates the Felton Water District.

January 28 – Shortly after American Water Works announced its acquisition of Citizens Utilities, the London-based company Thames Water Plc announced plans to acquire American Water and its subsidiaries. Thames is a division of RWE Aktiengesellschaft (RWE), the third largest for-profit water provider in the world.

September/October – A notice of application to merge Cal Am and RWE (required by the PUC) is sent to our District Attorney's office. Cal Am/RWE says this is the address on their list. However a notice is supposed to be sent to the County's Office of County Counsel and isn't.

October 1 – Santa Cruz County Board of Supervisors objects to proposed rate increases by Cal Am and votes unanimously to ask the PUC to hold a rate hike hearing in Felton plus to investigate a possible ban on exportation of drinking water. The Board also files a Motion to Intervene in the RWE Acquisition Case.

October 17 – Jeff Almquist holds a town meeting; approximately 150 Felton residents ask for the San Lorenzo Valley Water District to have control of Cal Am. Almquist reports an "overwhelming response from the public in support of local control."

October/November – Public meetings held; More than 175 formal letters are written. A petition garners more than 1,200 signatures to protest the rate increase and demand that SLVWD be allowed to take control of the Felton Water District.

November 20 – Cal-Am applies to the California Public Utilities Commission, proposing a 74% rate increase for Felton and consolidation of the Felton and Monterey water districts. The average increases proposed for 2003 would be 56.62%, in 2004: 8.83%, and in 2005: 2.29%.

American Water Works reports a 25% jump in income for the third quarter of 2002; its common stock share price increases 9.9% over preceding year.

November 21 – FLOW meets to select officers. Weekly planning meetings held at the Felton Firehouse start.

December 19 – PUC gives approval for RWE to purchase American Water Works. Cal Am, owner of our water system, is one of American Water Works' subsidiaries. American Water Works owns water systems in 26 other states and three Canadian providences. RWE will control water service for 2.6 million North American customers. RWE ordered to sell Montara's water district to Montara within 90 days of taking control of American Water Works.

January 29 – Two public PUC meetings concerning the proposed rate hike are held at the Felton Community Hall. Evening meeting attendance overflows hall.

March 7 – Local Agency Formation Commission (LAFCO) receives application to add Felton to SLVWD's sphere of influence. Acceptance would allow the San Lorenzo Valley Water District to operate Felton’s water system, if acquired.

March 26 – Jeff Almquist delivers 13 pages of prepared testimony to the PUC against the rate increase.

April 29 – Santa Cruz County ask the PUC to suspend proceedings on rate increases. Jeff Almquist's office states that Cal Am's rate proposal doesn't include the pass-down savings required by the PUC at time of purchase.

September 9 – Cal Am sends notice to county that it is seeking to establish a "memorandum account" with the purpose of tracking expenses for securing water systems from terrorist attack.

October 8 – Jeff Almquist leaves 5th District Supervisor position to become Superior Court Judge - ending his leadership role in FLOW.

December – PUC denies a challenge and requested suspension of Cal Am's rate increase application.

December 18 – FLOW meeting "Where We are Now" at Felton Firehouse to bring ratepayers up to date.

January – Cal Am/ RWE sends out flyer "Will County Supervisors Raise Your Taxes?". Cal- Am/ RWE phone survey done concerning supervisor race, SLVWD, FLOW

February 4 – FLOW meeting “Volunteer Organization ” at the Felton Firehouse.

February 11 – FLOW planning meeting: resumption of regularly scheduled bi-weekly planning meetings.

February 25 – Final arguments concerning rate increase placed before the PUC. FLOW steering committee members attend and speak. Decision due in mid-March.

May 6 – CPUC rules in favor of a 44% rate increase for Felton ratepayers. Rate increases start immediately though residents will not have to pay them until the CPUC approves or modifies a consolidation plan from Cal Am. The amount due from the rate increase is being tracked by Cal Am in a balancing account. By the end of 2004, the amount due was about $125,000.

June 8 – Public Citizen attends the Wall Street Conference on Investing in the Water Industry (incognito). They report that the mood was gleeful and that investors felt "water is under-priced" and "rates have room to rise" although some states are "inhospitable" such as New York, Connecticut, and Kentucky. Others unfavorable sites include New Hampshire which has taken back control of their water to protect it from "being controlled by foreign interests" and parts of Florida which has done the same to protect their retirees from rate increases.

July 10 – FLOW starts their summer outdoor movie series with "Thirst", a documentary about the commodification of the world’s water and community resistance in Bolivia, India, and Stockton, CA.

July 12 – FLOW’s first mailer with a letter, How You Can Help flyer, and fact sheet.

July 15 – FLOW turns in 1,305 signatures to the County Elections department asking that a Community Facilities District be established so that the community can vote on whether or not to set a bond for buying our water system. Cal Am/ RWE’s response is to ask for a copy of the petitions. (Denied.)

August 2 – Cal Am/RWE invites certain members of the community to the San Lorenzo Valley Senior Center to learn about government takeovers from the California Taxpayer Association. Cal Am/Rwe is a member of that association.

August 3 – Santa Cruz County Board of Supervisors consider petitions requesting establishment of a Community Facilities District to acquire the water system which serves the Felton area and take related actions. 4-0 decision in favor. "Water shouldn’t be in the hands of a private company," said Supervisor Jan Beautz. Gary Patton says the proceedings "highlight how concerned local citizens can use the tools of government directly to assert control over important aspects of their lives."

August 5 – Santa Cruz Sentinel reporter Jondi Gumz reports that Cal Am/RWE gave a grant to the San Lorenzo Property Owners Association; one of the items produced was a glossy 8.5 x 11 mailer showing a $100 bill in flames. Nothing in the mailer discusses water rate increases.

August 11 – Cal Am/RWE applies to the CPUC to combine the Monterey and Felton water districts. Comments from a 9/4/04 Monterey Herald on this matter include Monterey County Supervisor Dave Potter: "I can only look to other places where Cal-Am has come in and done water projects, and every single one of them has been balanced on the back of the ratepayers." Santa Cruz County Supervisor Mark Stone: "with this desalination plant, the more you can combine [the systems] the more you can hide inefficiencies." Cal Am/ RWE spokesperson Kevin Tilden is quoted as saying that "Cal-Am got off on the wrong foot with Felton residents, hitting them with a one-two-three punch and then failing to present an effective information campaign to ease their pain." Cal Am/ RWE used a hypothetical standard rate design instead of the Peninsula’s tiered rate structure in its application.

August 25 – Leak in Monterey water district takes three phone calls, five days, to fix; other problems include well failure resulting in an order to boil water "for a few days" and a tank over flow (17 hours, 50,000 gallons of water, landslide into the Carmel River).

September 1 – Valley Press publishes the first in a fourteen week series of questions posed to FLOW and Cal Am/ RWE.

September 11 – FLOW Community Barbeque – music provided by the Redwood Rounders and Ukenasia; silent auction and children’s activities.

September 23 – FLOW presents the documentary "Thirst" at the Rio Theater with a six speaker panel following the video.

October 13 – FLOW presents public meeting at the Felton Firehouse with speakers including board members of the San Lorenzo Valley Water District, Montara Water and Sanitary District, FLOW, Supervisor Mark Stone, Tod Landis.

October 14 – FLOW presents public meeting at the Boulder Creek Firehouse with the documentary "Thirst" and a question and answer period.

October 20 – Cal Am/ RWE starts work on the water main on Highway 9 between Graham Hill Road and San Lorenzo Way. (Project is still ongoing as of May 1, 2005.)

November 13 – FLOW benefit dinner with Chef Jozeph Shultz at the Felton Community Hall and served by the SLVHS Key Club. Island Breeze and their dance troupe appeared,we held drawing for a catered Joze dinner. Our thanks go out to Melani Hubbard of The Party Helpers, Bonny Doon Vineyards, and Zayante Vineyards.

November 22 – FLOW’s second mailer with newsletter and newspaper articles.

December 6 – Cal Am files a request with the CPUC for another 64% rate increase for Felton ratepayers, bringing the proposed total rate increase to 108%.

December 7/8 – CPUC comes to Monterey and Felton to gather public comment on the proposed consolidation between the Monterey and Felton water districts. Monterey customers object to paying more to subsidize Felton rates; both sets of customers recognize the effort as an attempt to diffuse FLOW’s efforts to buy the company. Felton customers report repair problems and that Monterey crews and contracted companies are already doing work in Felton. The new proposed rate to more than double Cal Am/ RWE Felton revenue by 2006 becomes public knowledge. Santa Cruz County, the Monterey Peninsula Water Management District, FLOW, and the Office of Ratepayer Advocates protest the proposed merger.

December 8 – Tod Landis files for FLOW Intervenor Status. He testifies at the CPUC with "customer accounts of their experiences, letters by California American Water Company executives, and evidence obtained by discovery to show that managing the Felton water district from Monterey caused serious problems. Work crews were inadequately supervised. Customers who should have been boiling their water weren't warned to do so. Road repairs were shoddy and hazardous." Tod says, "We want legal representation during the evidentiary hearing part of these proceedings. We have learned that a corporation's legal team prevented another citizens' group from introducing evidence, and we are concerned that the same thing will happen to FLOW. We have a story to tell that will not be heard if CalAm's high-priced lawyers can block us."

December 15 – CPUC grants FLOW intervenor status to comment on Cal Am consolidation and seek reimbursement for some legal expenses. The CPUC's intervenor compensation program provides compensation for reasonable costs as a result of participation in formal CPUC proceedings by citizens or small groups whose economic gain is small in comparison to the cost of making their voice heard. It is intended to ensure that the CPUC is aware of concerns and interests of a broad spectrum of interests.

December 22 – Cal Am/ RWE tries to block testimony by FLOW and the Monterey Peninsula Water Management District by filing a "motion to strike" portions of PUC testimony by representatives of these two groups; this testimony includes five pages of Felton service problems.

January – Cal Am/ RWE sends out two mailers purporting to show Montara’s dissatisfaction since they gained control of their water system. Montara Water and Sanitary District President Kathryn Slater-Carter and President pro tem Scott Boyd reject these claims pointing to the community celebration held to commemorate the one year anniversary of public water ownership and a stop to the endless cycle of rate increases and system neglect. President Slater-Carter adds that all board members up for re-election after the first bond payment were voted back in!

January 5 – FLOW participates in CPUC hearing in San Francisco. A CPUC Administrative Law Judge denies Cal Am/ RWE's motion to strike FLOW's testimony against the company. He also instructed Cal Am/ RWE to file an amended application to consolidate the Felton and Monterey districts to correct errors made by Cal Am in its original filing and to include the effects of CalAm's latest rate increase application.

January 6 – Chemical spill at Cal Am/ RWE Kirby St. Felton Plant. Employees run down the hill to the
Felton Fire Department. The County Environmental Health Department recommended the need to label chemical containers. Unanswered questions include the role and training of the employee who was transferring chemicals. Typically, certified operators handle chemicals in a water treatment plant to protect both the worker and the public.

February 9 – League of Women Voters of the Monterey Peninsula sponsors the program "Who Should Own Our Water Distribution System?"

February 11 – Sadza and FLOW present a benefit concert/ dance of marimba and mbira music with homemade desserts, India Joze chai, and White Raven coffee.

February 12 – FLOW talks about water at the Migration Festival at Henry Cowell Park.

February 16 – Cal Am/ RWE officially files the revenue rate increase of approximately 105% that was proposed in early December.

January 19 – FLOW, by invitation, addresses the Quaker group Santa Cruz Friends to discuss Felton’s water situation and water privatization.

February 22 – Assembly Bill 1397 is introduced into the California Legislature. California Water Association President Palle Jensen later confirms that Cal Am/ RWE played a role in drafting this legislation - the intent of which is to further change the structure of the eminent domain process. (Until 1992, state law held that there was an absolute presumption that a public taking of a private utility was in the public's best interest. In 1992, because of efforts by the California Water Association, the law was changed to a "rebuttable" presumption, meaning the private utility could challenge it. Lobbyist Margaret Catzen-Brown, representing the Water Association and with a record of lobbying for Cal Am/RWE, was instrumental in bringing the bill to the attention of assembly members.

February 24 – The American Association of University Women of Watsonville present "Who Owns Your Water?" with guest speakers from FLOW, Soquel Creek Water District, and Pajaro Valley Water Management Agency.

March 3 – An overflow crowd witnesses the San Lorenzo Valley Water District Board approve a Joint Community Facilities Agreement between the County of Santa Cruz and the SLVWD. This document allows the Cal Am/RWE Felton Water District to become part of the SLVWD in the event it is acquired by the Felton water customers; the Agreement lists responsibilities and ground rules concerning the acquisition of the district and Felton’s new partnership with SLVWD.

March 15 – A Resolution of Intent to Establish Community Facilities District 1is presented to the Santa Cruz County Board of Supervisors and passed. These sets the stage for the last public hearing before a vote on the bond indebtedness allowing purchase of the Cal Am/RWE Felton Water District can take place.

March 21 – A consortium of civil society groups urges the European Union to stop its efforts in "attracting the private sector into water and sanitation, including [the use of] various financial instruments to guarantee corporate profits." The consortium is appealing now because "it’s become obvious that private water companies are not the people to deliver water to the poor."

March 24 – FLOW speaks at the Green Words and Music event held at the Union Coffee House.

March 29 – A concerned Felton resident, experiencing a cutoff water supply, investigates the water main break near his house; Cal Am/ RWE claims that he is harassing them and calls the police. The resident explains that there wasn't a problem until he started taking pictures and Cal Am/RWE realized he wasn’t from the Santa Cruz Sentinel.

April 1 – FLOW sponsors a poetry contest with the theme "Poems about Water".

April 26 – Santa Cruz County Board of Supervisors hold a public hearing in Felton to determine approval for an election specific to the Cal Am/RWE Felton Water District. In spite of Cal Am/ RWE efforts to incite public opinion against the proposed Mello-Roos District vote with a 23 page mailed letter, a postcard, and a door hanger, the crowd of more than 200 give a standing ovation at the unanimous board decision to proceed with the vote. One of the many highlights of the evening was when the directors of the Montara Water & Sanitary District spoke to the crowd, challenging the idea that their rate payers were unhappy; the directors pridefully pointed to the numerous new improvements they have made to their system.

Early May – Measure W is created! We can vote for Local Control! Lower Rates! Local Accountability! Yes on Measure W! The ballot is placed on votescount.com with deadlines for arguments and rebuttals.

May 11 – Felton resident Patrick Dugan files a lawsuit against the signers of the Measure W ballot argument concerning the wording of the voter pamphlet. Jim Mosher, chair of the FLOW legal team, says, "We consider this lawsuit a harassment tactic by Cal-Am. We have sought out the best legal talent available to defend ourselves, and we expect to be vindicated. We are determined to move forward."

May 13 – The California Public Utilities Commission comes once again to Felton for two sessions concerning public opinion on Cal Am/RWE’s latest proposed rate increase: 105.2% 2006, plus 3.44% in 2007, and 1.03% in 2008 in addition to "two Special Requests". In response to Cal Am/RWE’s plea for more communication, ratepayers ask for more response to problems with service.

May 14 – The Great FLOW Yard Sale takes place greatly benefiting the FLOW campaign, Yes on Measure W. Thank you community donators and buyers!

May 17 – Seniors for Measure W hold a public meeting to answer questions about Measure W.

May 18 – Day One in Court: FLOW is ably represented by our legal team with attorneys Herman Fitzgerald and Randy Riddle concerning the lawsuit brought against the signers of the Measure W ballot argument concerning the wording of the voter pamphlet. Case postponed to June 6th. Cal Am/RWE representatives are in the audience.

May 20 – A report by Monterey Herald Staff writer Virginia Hennessey reveals that, contrary to the company's denials, state records show California American Water lobbied on Senate Bill 149 (2003), the legislation that would have dissolved Cal Am/RWE's only local regulator. This failed bill, backed by former Sen. Bruce McPherson, would replace the Monterey Peninsula Water Management District's elected board of directors with a panel of area mayors. Cal Am also donated $10,000 to Measure B (Monterey, 2002), an advisory measure that passed, calling for the district's demise.

May 21 – La Bruschetta with Chef Luca Rubino and FLOW present an Italian Barbecue and Buffet to benefit FLOW. Live music provided by Michael Renwick and Rory Koshlaychuk.

May 23 – "Poems About Water" contest entries are presented by the poets and others in a reading at the Felton Community Hall. Congratulations to all entrants who celebrate the importance of water and art in our lives.

May 28 – Felton Remembers Parade: FLOW supporters walk in the parade with the FLOW Drill Team and Frank Adamson riding in a bathtub.

July – Felton citizens pass Measure W, allocating up to $11 million to purchase the Felton waterworks from Cal-Am.

August –The PUC adminstrative law judge recommends denying Cal-Am's proposal to merge the Felton and Monterey water districts. He also recommended that Cal-Am implement a 30% rate hike into water bills and that the remainder of the already-approved 44% rate hike be rolled into the 114% rate hike proposal. The PUC will vote on the administrative law judge's recommendation in the Fall.