Water Company Rains on Ojai’s Takeover Vote

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Golden State Water Co. has no intention of surrendering its water system in Ojai even after a landslide vote that called for a neighboring municipal water agency to take over.

Golden State, the water utility subsidiary of American States Water Co. of San Dimas, has already filed a lawsuit challenging the measure. And even if the measure is upheld, Golden State intends to fight any effort by the neighboring Casitas Municipal Water District to use eminent domain to force it to yield.

“Passage of Measure V does not affect Golden State Water Co.’s commitment to serving Ojai or mean that our system will be acquired by Casitas Municipal Water District,” Patrick Scanlon, vice president of operations, said in a statement. “There are still significant legal and financial questions that must be addressed. Until they are, we remain focused on providing customers with quality service and reliable drinking water.”

Eighty-seven percent of voters supported last week’s bond measure. The election came after a two-year campaign by a group of Ojai residents to wrest control of the water system from Golden State. The residents were upset over a series of water rate hikes, which they say have averaged 8 percent a year for the past 20 years. They have been pushing for the Casitas water district to take over the system.

Golden State executives have said the rate hikes were needed to perform maintenance upgrades on the aging water system and that any other operator would face the same maintenance. They said their Ojai system was not for sale and filed suit, contending that the Mello-Roos bonds the measure authorizes cannot be used for eminent domain proceedings. A hearing is set for next week.

Even if initiative proponents prevail on the bond question, they still face a lengthy legal fight on eminent domain.

“Casitas will spend millions on lawyers and consultants, secured by liens on peoples’ property, to discover that the cost to acquire and operate the system is greater than the bond amount and would result in higher water costs for Ojai customers,” Scanlon said in the statement.

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Howard Fine
Howard Fine is a 23-year veteran of the Los Angeles Business Journal. He covers stories pertaining to healthcare, biomedicine, energy, engineering, construction, and infrastructure. He has won several awards, including Best Body of Work for a single reporter from the Alliance of Area Business Publishers and Distinguished Journalist of the Year from the Society of Professional Journalists.

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