NAVY TO DOUBLE PRICE OF WATER ON GUAM

admin's picture

By Gaynor Dumat-ol Daleno

HAGATNA, Guam (Pacific Daily News, Aug 16) – The Navy plans to double the price of the Guam Waterworks Authority's water purchase from the Fena water treatment plant, and GWA customers could ultimately pick up the higher tab.

The Navy confirmed yesterday that the planned price increase is the result of higher costs to operate the plant, which has gone through recent multimillion-dollar upgrades for better water quality.

GWA's cost of purchasing water from Fena will increase from about $3 million to $6 million a year, said Lt. Donnell Evans, the Navy's public affairs officer on Guam.

The Navy plans to implement the increase in about two months, Evans said.

Such price adjustment translates into a 6 percent increase in how much GWA customers pay for water, said Simon Sanchez, chairman of the Consolidated Commission on Utilities, which functions as the agency's board.

Informally, military officials have indicated the price increase might take effect on Oct. 1, which is about 45 days from now, Sanchez said.

Sanchez said he's concerned about the magnitude of the Navy's sudden price increase.

Sanchez voiced hope both sides "can work out a better solution than a 100 percent increase in 45 days."

GWA will try to reduce dependency on water from Fena as well as make adjustments to its budget to try to avoid passing on the Navy's higher cost to GWA customers, said GWA spokeswoman Heidi Ballendorf.

But Sanchez said GWA does not have an extra $3 million in its budget to cover for the 100 percent price increase.

The Legislature can help out by approving a subsidy for GWA, but Sanchez said that's unlikely.

Without legislative assistance, the CCU chairman said ratepayers are the only source of cash for GWA to pay for the unexpected extra expense.

GWA buys water from the Navy-owned, but privately operated, Fena plant for the southern Guam residents' water needs.

Agat, Santa Rita and Nimitz Hill receive water from Fena, Ballendorf said.

Sanchez said he's curious about the Navy's pricing, in part because the Navy receives federal funding for its plant upgrades.

In contrast, GWA had to go into debt to pay for improvements to its plants.

GWA customers are already expecting a water rate increase that will show the next time they get their water bill.

The Public Utilities Commission on Monday approved a16.5 percent water rate increase, or about $3 more for the average monthly residential water bill.

The Navy's price increase also proves a point Sanchez said he been saying all along: A small pool of paying customers, as is the case with the Navy's Fena water treatment plant, means higher rates for customers.

He said that's why it's important for both the military and civilian communities on Guam to seriously talk about ways to integrate their water and power systems to make utilities more affordable to customers.

"We hope we can sit down with the Navy and have conversations about whether the (Fena water price increase) is reasonable and have larger conversations about merging our power and water systems," Sanchez said.

Rate this article: 
No votes yet

Add new comment