BULLHEAD CITY — Bullhead City voters will be asked to decide whether the city should acquire EPCOR Water Arizona’s infrastructure serving residents in the Mohave and North Mohave districts.
Council members on Tuesday voted 6-0 in favor of calling for an all-mail ballot election to be held Nov. 5. The Council Chamber wasn’t full but dozens of people came to the meeting to watch — or participate.
EPCOR has said it isn’t interested in selling the system so the city likely would have to take EPCOR to court for an assigned value to pay the utility for its local holdings in condemnation proceedings.
The utility company has said its local infrastructure is worth about $130 million while a valuation contractor for the city estimated its worth at closer to $55 million.
Recent — and potentially future — water rate increases are what have been driving this city government effort.
“Greed is not a word I use lightly. Greed is the appropriate word I choose to use,” said Mayor Tom Brady about EPCOR, which is owned by the city of Edmonton, Alberta, Canada.
Brady said he came to that conclusion after traveling to Phoenix numerous times to address members of the Arizona Corporation Commission about EPCOR.
At the ACC’s insistence, EPCOR first proposed in 2017 new rates and consolidation of its Arizona holdings into one structure that would equalize water rates throughout the company’s Arizona entities.
Brady also spoke during interim rate case meetings that resulted after the original rate case was determined not to have been fully resolved. Within only four years, EPCOR sought and was permitted to raise average local monthly rates from $21 to $38, Brady said.
“That’s an 86% increase,” Brady noted. “In my mind, this is totally unacceptable.”
He also pointed out that the ACC wanted EPCOR to file another rate case in May 2020, using 2019 as the evaluation year to see if the request is valid.
Brady said he anticipated that request will seek other adjustments for such things as power and property tax costs that would be factored into the amount of increase the ACC could allow. The company asked for that in its earlier request but didn’t receive it at that point.
City Manager Toby Cotter, Brady and other Bullhead City officials said the proposed rates were too high for people in a community with a poverty rate of about 22%.
“If you don’t buy it now, think about what it’ll cost in 20 years,” said John Pynakker, president and CEO of the Bullhead Area Chamber of Commerce.
About 20 or so people wore T-shirts with the phrase “No Eminent Domain.” Most had ties to EPCOR and its local operations. Some were employees who work here on the utility’s water infrastructure, while others were people close to them.
Only one of them spoke to the council against the resolution.
Chad Gebow, an EPCOR employee who has lived in Bullhead City for more than 25 years, said the proposal was too costly for the community.
Resident David Lipinski, however, drew boos from the audience when he asked the council not to move forward with the resolution.
“This is eminent domain to make it cheaper or better,” he said. “It sounds like communism. ... Take a step back.”
As far as the number of speakers, supporters of the resolution outnumbered opponents.
“I wonder why they don’t just let go and let us do this,” said resident Lori Fonzi. “Water is a necessity. We all need it.”
“You convinced me,” said Jack Hakim, former mayor and a member of the Parks and Recreation Commission. “The wastewater plant turned out very well for us.”
“I love Canada. Edmonton gave us Wayne Gretzky,” said Dave Lords, a resident and area developer. “Bullhead City has just outgrown EPCOR. It’s totally about local control.”
The council then approved putting the measure on the ballot, where voters will decide if the city should go forward or back away.
“We’re disappointed with the city council decision,” said Shawn Bradford, vice president of EPCOR’s corporate services in Arizona. He also addressed the council during public comment.
Bradford said residents are being asked to give city government “a blank check of up to $130 million” to acquire the water delivery system — excluding debt service.
“It’s too much for the city’s residents,” he added.
Council member Mark Clark recused himself from taking action on the matter. Clark said that he was working by contract with Johnson Utilities, which is based in the San Tan Valley. EPCOR was named as the acting interim manager of Johnson by the ACC.
“I don’t want anyone to think I’m doing anything improper,” Clark explained, in reference to Bullhead City’s resolution.
EPCOR obtained control of the local water delivery system when it purchased Arizona American Water in 2012.