Council may pull ballot proposal as part of EPCOR compromise

September 12, 2018

BULLHEAD CITY — On Thursday, the Bullhead City Council will be asked to remove its proposal to purchase the Bullhead City assets of EPCOR Water Arizona from the November ballot and instead submit an alternative consolidation plan to the Arizona Corporation Commission as part of EPCOR’s ongoing rate increase hearing.

A special meeting has been called for 5:30 p.m. in the city council chamber, 1255 Marina Blvd., according to an agenda posted on the city’s website Tuesday afternoon.

In July, the council voted to place Proposition 410 on the general election ballot, asking voters to decide whether the city should acquire or condemn EPCOR’s water assets in Bullhead City and take over operation of the local water utility, in response to a rate increase and consolidation plan EPCOR has before the Arizona Corporation Commission.

Bullhead City Manager Toby Cotter, who has been involved in talks with EPCOR since the issue arose, said the city was objecting to both a rate increase that would see average water bills in Bullhead City rise from $28 a month to $45 a month and a consolidation plan that would treat Bullhead City residents the same as those in the metro Phoenix area.

“It was full consolidation or stand-alone,” Cotter said. “We kept saying there must be some other option ... something that was more fair and equitable to the residents and businesses of Bullhead City.”

That option, to be considered if the city does pull Proposition 410 from the ballot, would be for EPCOR’s four Mohave County water districts — Mohave, North Mohave, Willow Valley and Havasu — to consolidate but remain separate from EPCOR’s other seven water districts in Arizona.

“That’s one of the major points that was explored in Edmonton when we met with EPCOR,” Cotter said.

Under what is called “Scenario 3,” Bullhead City residents likely would see a rate increase, but less than originally sought by EPCOR.

“Unfortunately, EPCOR has a rate increase in front of the Corporation Commission,” Cotter said, adding that it was likely the ACC would grant the increase. Now, he said, there could be another proposal to put before the ACC.

“It is still a rate increase,” Cotter said, describing the numbers in the Scenario 3 proposal, “And it’s hard for everybody to swallow a rate increase. But it’s 36 (dollars), not 45 (dollars). That’s a big difference.”

City officials haven’t been able to project a future water rate should the city take over operation of EPCOR’s local assets — partially because a price tag on the value of those assets is in dispute. The resolution authorizing Proposition 410 capped the city bond issue for the purchase at $200 million.

The Scenario 3 proposal would mean the city wouldn’t need a bond issue.

Cotter said his recommendation before the city council will be to pull Proposition 410 from the ballot and submit the Mohave County consolidation plan to the ACC. He said that EPCOR has pledged its support of Scenario 3.

“That’s what we’ll be talking about Thursday in front of the city council; pulling this from the ballot and supporting EPCOR in this (Scenario 3),” he said.

In Cotter’s council communication supporting his reasoning for making the request, he admitted there was no guarantee it would be accepted by the ACC.

“The Arizona Corporation Commission is expected to vote on the proposed rate case and consolidation later this fall,” the communication said. “Bullhead City officials believe that the Corporation Commission officials will act in the best interest of city residents; however, the commission may still approve the original full-consolidation plan, adopt Scenario 3 or take other action.”

The matter can’t wait until next week’s regular council meeting because the Mohave County Elections Department is preparing general election ballots so that early ballots may be sent to voters in early October, Cotter said.

“Timing-wise the county needs an answer from us if we’re going to pull it from the ballot,” Cotter said.

Also on the agenda for Thursday is the routine canvassing of the Aug. 28 primary election.

“We had to have a special meeting to canvass the recent election,” Cotter said. “That’s a routine meeting. Since we’re having that meeting — and this issue came up — if we’re going to pull it, we need to pull it Thursday night.”

A third agenda item is for discussion and possible action on the Travel Management Plan environmental assessment from the Kingman Field Office of the Bureau of Land Management.

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