On behalf of The Silicon Valley Organization (The SVO), we are writing to support San Jose Water Company’s (SJWC) Cost of Capital Application (A. 17-04-001). By way of background, we are the Silicon Valley’s premier business advocacy organization representing 1,400+ companies that employ nearly 300,000 workers and we represent our membership as the region’s largest Chamber of Commerce.
Safe, high quality and reliable water service is the foundation for public health protection, economic development, and a high quality of life. According to the American Society of Civil Engineers, almost $335 billion of investments are needed over the next 20 years to ensure the nation’s water systems can continue to provide safe and reliable service. California leads the way with $39 billion in water infrastructure improvement needs over the next 20 years. Many water system components such as pipes, wells, and tanks, have reached the end of their useful lives and require replacement. Additional investments in the water system components like tanks, wells, and pipes are needed to ensure customers can continue to receive safe and reliable service. These investments also create thousands of jobs benefitting our local economy. SJWC seeks a fair return on these infrastructure investments in A.17-04-001.
This fair return will allow SJWC to attract the necessary capital to fund water infrastructure improvements. The current proposed decision offers the lowest return on equity and rate of return for any regulated utility in the country and jeopardizes the company’s ability to meet its goals to serve the community at-large. We should not allow over-regulation to impact SJWC’s ability to provide high quality, safe, and reliable water to our residents and businesses in Silicon Valley.
We urge you to reconsider your decision and propose an alternate return on equity and rate of return that will allow SJWC to continue to deliver safe, high quality, and reliable water service at reasonable rates.