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UPDATE: Castaic Lake Water Agency eyes buying Valencia Water Company

Posted: December 11, 2012 12:22 p.m.
Updated: December 11, 2012 6:04 p.m.
 

The Castaic Lake Water Agency is scheduled to vote Wednesday night on whether to buy one of the Santa Clarita Valley’s privately held water retailers, which would give Castaic Lake 84 percent of the valley’s retail water connections.

If approved, the acquisition bodes well for Santa Clarita Valley ratepayers who could expect to see a leveling of rates in the long run, according to agency General Manager Dan Masnada.

The acquisition, which would put Valencia Water under a a publicly elected board of directors, would make the water retailer eligible for grant funding, Masnada said.

Such funding, over time, would serve as a moderating influence on rates paid by customers, he said.

“It’ll mitigate (rate) increases in the long term,” Masnada said.

The item on Wednesday night’s agenda would authorize agency staff to initiate eminent domain proceedings “with the goal of reaching a negotiated settlement” with Newhall Land Development Inc., which owns Valencia Water, according to a news release issued Tuesday by Castaic Lake.

“Technically, we would be negotiating a stock acquisition in which (Castaic Lake Water Agency) would purchase the Valencia Water Company stock,” Masnada said. “At least initially, Valencia Water Company would continue to operate as a utility regulated by the California Public Utilities Commission.”

Valencia Water was established in 1954 to provide retail water service to Newhall Land’s Valencia developments. It has 29,022 service connections.

The Castaic Lake Water Agency is a wholesaler that provides State Water Project water to the Santa Clarita Valley’s water retailers. About half the water used in Santa Clarita Valley homes and businesses comes from Castaic Lake. The rest is well water.

Castaic Lake already owns Santa Clarita Water Division, another water retailer. The remaining retailers in the valley include District 36, which has a small clientele in Castaic and Val Verde, and Newhall County Water District, the oldest water retailer in the valley.

Newhall County and Castaic Lake are the only two local water districts governed by publicly elected boards.
The Valencia Water acquisition is “something we’ve been talking about off and on with Newhall Land,” Masnada told The Signal Tuesday.

“It’s something that involves a willing seller and a willing buyer.”

A special meeting of the CLWA board of directors is scheduled at 6:15 p.m. Wednesday at 27234 Bouquet Canyon Road in the Rio Vista board room overlooking Central Park.

jholt@signalscv.com
661-287-5527

 

 

 

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