(CN) – A California appeals court dismissed a water company’s claim that the Santa Clara River Valley Water District improperly raised its groundwater-charge rates in order to fund expansion.
The Great Oaks Water Co. challenged the district’s rate increase, which was based on the California Environmental Quality Act’s exemption for “meeting operating expenses; purchasing or leasing supplies, equipment, or materials; meeting financial reserve needs and requirements; or obtaining funds for capital projects necessary to maintain service within existing area.”
By contrast, a rate increase would not be allowed for capital projects in an expanded service area.
Great Lakes argued that the district merely copied the exemption language in its written justification for the rate increase, rather than explaining its reasons specifically.
Also, Great Lakes said the increased rates funded an expansion of the water system, an action that would not fall under the exemption.
The 6th Appellate District Court of Appeal disagreed.
“The district adopted the groundwater rate increases as discussed in its annual report for the four purposes listed in its findings, and these purposes are statutorily exempt from the CEQA,” Justice Duffy ruled.