CAGRD Annual Adjuster Fee Reset, Decreased
The Central Arizona Groundwater Replenishment District (CAGRD) is a division of the Central Arizona Project that helps water users in Maricopa, Pima and Pinal counties meet their water supply needs. As a Member Service Area of the CAGRD, Johnson Utilities pays the CAGRD an annual amount and assesses an adjustor fee to customers to defray this expense. This fee shows up as a regular, recurring line item in customers’ monthly water bills. The fee is collected, but not kept, by Johnson Utilities and paid to CAGRD. On February 4, the ACC approved the annual adjuster fee that Johnson Utilities proposed last October. The fee is based on actual water sold within the Johnson Utilities system along with the CAGRD’s current rates – it is not related to EPCOR’s interim management of Johnson Utilities. The new amount will appear in the first customer billing cycle after February 4, and will be effective for the next 12 months. For customers in the Phoenix AMA, the new rate is $0.76 per 1,000 gallons. For customers in the Pinal AMA the rate is $1.07 per 1,000 gallons. The average Johnson Utilities residential customer using about 5,700 gallons of water every month will see a savings of roughly $6.21 to $8.15 a month, depending on which AMA they live in.

Community Meeting on Rate Case
As Interim Manager, EPCOR was required by the Arizona Corporation Commission (ACC) to file this rate case, based on 2019 expenses, on behalf of Johnson Utilities. To do that, we contracted with external rates, regulatory and financial experts to develop and file it by Feb. 14 as required.
This application is not related in any way to EPCOR or its customers.

EPCOR places a high priority on transparent communications, and we know customers will have questions about the Johnson Utilities rate case and how it will impact them. We encourage you to attend our next community meeting March 25 – please note the details below.

Thursday, March 26, 2020
6 to 7:30 pm
Central Arizona College – San Tan Campus
3736 E. Bella Vista Road,
San Tan Valley, AZ 85143

What is in the Rate Case Application?
Rates generate the money it takes to run and maintain a utility – rate changes are looked at when rates aren’t generating enough money to cover the costs, or when they are bringing in more money than needed. For Johnson Utilities, it’s a combination of changes in the cost to run the system and critical infrastructure projects that have been completed to improve your service.

Current water and wastewater rates for Johnson Utilities are based on costs from 2007. The new required rate filing is based on what it costs in 2019 – 12 years later – and requests the revenue difference between the 2007 and 2019 test years to reflect current operating costs. Based on the figures in the application, the potential change to the average monthly residential customer bill could range from $3 to $15 depending on whether a customer receives water service, wastewater service, or both, and how much water they use. These numbers are proposed, not approved – the ACC will fully review the application to determine if there should be a change to rates.

EPCOR continues to make significant improvements in the Johnson Utilities system, and investment is still needed to secure the system’s long-term health and to provide safe, reliable service now and into the future. If the ACC approves new revenues from this application, they will not be used to pay for the capital investments outlined in a plan the ACC approved last year – the Commission is requiring Johnson Utilities’ ownership to finance those projects.

The ACC normally takes at least a year to review and decide on rate cases, so customer bills won’t see any change to rates before spring 2021 at the earliest. EPCOR is committed to keeping Johnson Utilities customers informed as the process continues.

Water Supply
With the warm, high-use season approaching and the temporary restriction on new service connections lifted, we’re prioritizing expanding water supplies in the Johnson Utilities system. This approach served us well in 2019 and includes these approaches for 2020: Optimizing existing supplies through multiple improvements to the water treatment process. The project to install a third ion exchange water treatment vessel at the Main Yard is moving ahead on schedule. We’ve also added flow-pacing technology to give us the ability to treat water more consistently, effectively and efficiently.

Developing new wells. We expect the new Promenade Well #2 to be operating by late spring – this will add 2.6 million gallons of water a day to the system. Other new wells are in various stages of development. We’re also evaluating existing but non-operational wells to bring them online where we can, an ongoing process to maximize the existing resources in cost-effective ways.

Hydrant Maintenance and Public Safety
A safe and reliable water supply is about more than drinking water. Emergency water supplies available through hydrants – and water pressure adequate for them to operate correctly – are critical for community health and safety. We’ve recently implemented a program of regular hydrant maintenance throughout the Johnson Utilities service territory. We’ve already serviced and made repairs when needed to about 20% of the hydrants and we’re steadily working through the rest. And because of the water-pressure improvements we’ve already made in throughout the system, hydrants will operate better should they be needed for emergency water supplies.

America’s Water Infrastructure Act Compliance
America’s Water Infrastructure Act (AWIA), signed into law Oct. 23, 2018, provides for water infrastructure improvements throughout the country. The law requires community drinking water systems serving than 3,300 people to develop or update risk assessments and emergency response plans to protect water infrastructure resources for the public good. As Interim Manager, EPCOR is developing materials mandated by AWIA for Johnson Utilities and will submit them as required to the Environmental Protection Agency by the end of 2020.

EPCOR works each month with Johnson Utilities’ contracted environmental compliance staff to ensure we’re meeting regulatory monitoring and reporting requirements at all four of the utility’s wastewater treatment plants. We also meet regularly with Arizona Department of Environmental Quality staff to assess compliance actions and appropriate resolutions as needed.

At the Section 11 facility, there has not been an odor exceedance in over 12 weeks. We’re pleased with this progress but will continue to monitor conditions as closely as ever. We’re also evaluating an experimental technology that may be useful in raising the dissolved oxygen levels – part of effective treatment of wastewater – at the Section 11 aeration basins.

There were two reportable sanitary sewer overflows in January. Neither were due to problems in the overall system, and were quickly identified, reported and repaired.

Did you know? Influent refers to wastewater flowing into a water reclamation facility, while effluent is the treated water that flows out of it. In Arizona, it is standard industry practice to reuse and recycle fully treated effluent – also known as reclaimed water – for approved uses such as industrial cooling, watering parks and other public spaces, and groundwater recharge.

Pecan Facility Expansion
Expanding the Pecan Wastewater Treatment Plant is a priority capital improvement project, and we’re underway with implementing its initial phases as the Arizona Corporation Commission ordered last July. The overall expansion project includes these key components:

  • Design and construct an upgraded effluent disc filter to increase the plant’s treatment capacity. This is in process.
  • Design and install new effluent pumps to meet current and future demands for using effluent treated at Pecan. Work on this is beginning.
  • Replace the existing influent pump station and headworks at the facility. All are in serious disrepair and near the end of their useful life. We expect to begin this work in March.