Apple Valley awaits ruling on utility takeover (October 17, 2018)

APPLE VALLEY — Residents were told Tuesday that officials are still waiting on a court ruling to determine the scope of the town’s lawsuit against water provider Liberty Utilities.

An August hearing was held to determine what factors should be considered in determining whether the town has the right to acquire Liberty’s water system. Kendall MacVey, an attorney with the law firm of Best Best and Krieger, told about 80 residents at an informational meeting at Town Hall that “we still have not gotten a decision. That decision may affect how the case unfolds.”

Apple Valley sued in January 2016 after what town officials described as public outcry over increasing water rates. MacVey said Liberty must prove in court that residents are better off with a privately owned water agency rather than a public one.

Both sides anticipate a 2019 trial, which Liberty’s attorneys have said could last up to six weeks, according to MacVey. The trial could be shorter if the court’s pending decision favors the town, he said.

Liberty’s attorney, David Moran, attended the Town Hall meeting. He told the Daily Press that Apple Valley residents are being provided “the wrong information.”

“You’re going to have to spend millions of dollars in attorneys’ fees to go through the right-to-take phase,” Moran said. “Even if the town’s attorneys do a good job, you’re looking at probably at best for them a 50-50 proposition as to whether or not they’re going to be able to take the water system. And so they’re going to spend millions of dollars to get to, basically, a coin flip.”

Tuesday’s hour-long meeting included discussion on what Assistant Town Attorney Thomas Rice called a “history of concern” over Liberty’s rate increases. He compared rates in Apple Valley to those in neighboring cities that showed, assuming similar usage, Liberty customers paid nearly $570 more per year than Hesperia customers and roughly $500 more than those in Victorville.

Documents obtained from Liberty, however, indicated that average water bills are lower than they were in 2013. Roughly 65 percent of customers pay $50.62 per month for water on average, according to the documents.

Liberty officials have not responded to a request for comment on how bills have lowered amid rate increases, but the documents pointed to a 30-month rate “freeze” in effect until June 30, 2019, as well as a 4 percent rate decrease from May that the company said passed on federal corporate income tax savings to customers.

A separate suit filed by Liberty in 2015 alleged California Environmental Quality Act (CEQA) violations in the town’s environmental study on acquisition.

The CEQA suit delayed progress on the first lawsuit, but a settlement was reached in May in which the town waived its right to recoup more than $23,000 in legal and administrative costs in exchange for Liberty foregoing an appeal. On Tuesday, BBK attorney Charity Schiller said that decision saved the town money because an appeal would have been costlier.

Meanwhile, the town’s eminent domain costs were not disclosed Tuesday because they were not the subject of the meeting, according to town spokesperson Orlando Acevedo.

“This was an informational meeting on the status of where we are and where we are headed,” Acevedo said. “This continues to be a pressing question of our residents, particularly in light of another rate increase (requested in January) by Liberty.”

Tuesday’s meeting is expected to be archived on the town’s website at a later date.

Source: Matthew Cabe, Daily Press.