How can rate payers control what the company spends BEFORE it is spent and requested to be recovered by a rate increase?
In short, they can’t. However, the process for requesting a rate increase is very difficult. A utility is never guaranteed a rate increase and the final amount is determined by the Arizona Corporation Commission. When making the decision to spend money on a new facility or system improvement, the company conducts a rigorous internal review to determine if the project is needed, if the project is well-designed to be as efficient and cost effective as possible and if the company can expect to receive a rate of return from the ACC for the investment spent. To remain a strong utility able to ensure its customers a safe, reliable drinking water supply and wastewater service, Liberty Water must receive a return on investments that satisfies its shareholders. It is not in the company’s best interest to waste money on projects that are frivolous or unnecessary.
