Anthem residents cry ‘foul’ over sewer rate increase
by Kathleen Stinson

ANTHEM – Arizona‑American Water is asking the state’s permission to increase its wastewater rates by 52 percent.

This is in addition to the company’s request to increase its residential water rates by about 70 percent, as stated in the company’s application for a water and wastewater rate increase filed with the Corporation Commission in June.

The proposed rate increases would go into effect, if approved, on or before July 1, 2007.

Peter Sera purchased a new home in The Panhandle of Anthem in August. He says neither Pulte Homes/Del Webb Corp., who sold him the home, nor his homeowners association told him at the time he would have to contribute to water system infrastructure costs in his water bill.

The association requires him to put an irrigation system in his backyard in the near future.

“I’m certainly not going to water plants that don’t need it before taking care of my family,” Sera told The Desert Advocate. He is going to hold off on putting in his backyard plants until the commission makes a decision on the proposed rate hike.

Another Anthem resident James Jones relocated from Naples, Fla. a year ago. He said he moved  to  Arizona because the cost of living is 23 percent less than in Florida.

“The issue is if the (water/ sewer) rates increase–the more it goes up, we’re getting back to why I moved here,” Jones said. 

“These folks aren’t really straightforward. This claim that their 2004 rates decreased 7 percent is deceptive from a consumer’s perspective because we actually paid more,” said Carl Young, another Anthem resident.

According to Young, the water rates decreased some but the sewer rates increased after the 2004 rate change hearing. “They keep coming back,” he added. “It’s an endless process to increase these rates.”

In 1997, Del Webb signed an agreement with Citizens Utilities Co., Anthem’s first water provider, that specified low initial water and wastewater rates, the application states. Del Webb initially paid for the water and wastewater infrastructure.

Arizona‑American Water acquired Citizens in 2002 and agreed to refund Del Webb for its investment in the infrastructure, “with the bulk of those payments coming as the Anthem community neared build‑out,” the application states. That build‑out is fast approaching.

“The water rate for Anthem customers has not increased since the original development of the planned Anthem community in 1998‑1999,” said Todd Walker, spokesman for Arizona‑American.

“Since 1998,” according to Walker, “water rates nationwide increased over 30 percent as a whole across the country.”

Arizona‑American claims it is in “critical financial condition” and has “under‑earned” in Anthem and other service areas for several years.

“If it were rated on a stand‑alone basis, Arizona American would have long ago been rated in the junk‑bond range,” the application states. The company has been kept alive by the “willingness of its parent (company) to continue to inject new equity ...”

No date has been set for a hearing on the requested rate increase. The state has one year from the date of filing the application to render a decision.

Arizona‑American plans to hold community meetings to gather resident input and explain the reasons for the proposed rate adjustment.

Reach the reporter at kathleen@thedesertadvocate.com.