Last year, the May Co.-California paid $2.5 million for electricity, and the chairman of the North Hollywood-based department store chain, Ed Mangiafico, complained that rates were going up too fast.
Bud vom Cleff leases a 35-acre sod farm in Van Nuys. He said further water-rate increases would discourage him and others in the dwindling ranks of San Fernando Valley farmers from staying in business.
And Wallace R. France, an Encino homeowner who had never before spoken at a public hearing, said he doesn't understand the numerical nuances of rate making, but knows one thing for sure: "It's getting so my wife and I just can't afford it anymore."
The three men were among 50 people who attended the Los Angeles Board of Water and Power Commissioners' public hearing on proposed water and electricity rate increases Tuesday night in Van Nuys. The commissioners are expected to adopt the increases on July 25.
The 21 people who spoke all criticized either the proposed 4.5% electrical-rate increase or the proposed 6.7% water-rate increase. The water increase would include much higher rates in the spring and summer months in a first-of-its-kind effort to promote water conservation during the prime lawn-watering season.
Most of the $12 million the increase would raise in its first year would help pay for a water filtration plant being built in Sylmar. About $1 million would help clean up 12 chemically contaminated water wells in North Hollywood--a sore point among several speakers, who complained that ratepayers should not finance the cleanup of wells someone else polluted.
The board also heard sharp words about its proposed increase in electric rates, which the Department of Water and Power says is needed to pay for Los Angeles' share of electricity from a nuclear power plant being built near Phoenix. The criticism Tuesday included general opposition to nuclear power and specific complaints about how the DWP times rate increases.
If the increases are adopted by the commissioners and approved by the City Council and Mayor Tom Bradley, they would take effect in November. Both increases would have considerable effect in the San Fernando Valley, which has about half of the DWP's 700,000 water customers and half its 1.3 million electricity customers, the department says.
Tuesday night's hearing at Carpenters Hall in Van Nuys was the second of two on the proposals. The first, held downtown July 2, drew only about 15 people.
"We always have bigger turnouts in the Valley, perhaps because there are more residential customers in the Valley than downtown," DWP rate manager Ralph Carlson said.
The surprise of the evening was Mangiafico's appearance.
Carlson said such public hearings usually attract a mixture of environmentalists, senior citizens, homeowners and small businessmen. High-level executives, he said, typically make their feelings known in private meetings with City Council members. "We do hear directly from various business groups at hearings, but not from someone like that," Carlson said.
Mangiafico said it was the first time he had gone to a forum on rates. He said he normally would request a private meeting with utility executives but that he felt that standing up at the microphone in the public auditorium would have "more political impact."
"I find myself quite dismayed by the increase that we will be facing by 1989," he said. By then, he said, May Co. will be paying $3.8 million annually for electricity.
Carrying Debt Suggested
He advised the commissioners not to impose a large rate increase all at once in a rush to wipe out debt on projects as fast as possible. He suggested that they carry the debt over a longer period and pay it off in regular chunks.
The three commissioners attending the hearing said they would consider Mangiafico's remarks, along with those of the others who spoke. But the officials made it clear that the complaints likely would make little difference. Commissioner Rick Caruso said the proposals "will be approved by this board and sent to the City Council."
DWP staffers said the origins of the water rate proposal are political: There is pressure from environmentalists who have been trying in a series of lawsuits to restrict the city's use of water from Northern California, and pressure from Northern California lawmakers, who oppose additional water exports to a region they view as insufficiently conservation-minded.
According to the DWP, lawn sprinkling by homeowners accounts for nearly one-sixth of all water used in Los Angeles. In the San Fernando Valley, outdoor water use at single-family homes averages about 85 gallons per person per day.
"I have a modest little house and I water the lawn of that little house to protect the value of my property," France told the board. "I feel I'm being penalized for that." Also at the hearing was Frank Hathaway, who said he was representing the Riviera Country Club in Pacific Palisades. Hathaway said the water rate increase would put a disproportionate burden on golf courses, which do most of their watering during the summer. "I think these figures are rampantly unfair," he said. "A golf course must be watered or it will die."
Carlson said Wednesday he was surprised that the several private golf courses in the San Fernando Valley did not send representatives to the meeting.
Exceptions Ruled Out
He said DWP officials had considered making exceptions for golf courses, farmers and others who use large amounts of water. "This was all thought about," he said. "But to make exceptions for one group of users or another would not be constructive for the policy of conservation."
Under the DWP's proposals, the higher summer water charge would be instituted along with a smaller decrease in charges the rest of the year. The result would be the overall 6.7% increase.
The average water user now pays $16.92 a month between April 1 and Sept. 30. Under the proposed new rates, the average bill would be $19.55 a month. The charge for the average household would go down from $11.80 to $11.11 in the other months.
The proposal calls for electric rates to increase from $28.65 a month to $29.92 a month for the average ratepayer.
The last DWP rate increases, which took effect Dec. 1, were 5.8% for water and 3% for electricity.
The $52 million the DWP would raise from the pending electricity rate increase is to be used to help it pay $260 million over the next two years for power from the Palo Verde Nuclear Power Plant near Phoenix. Power from the plant, which will go into operation in three phases starting in early 1986, is expected to supply about 9% of the city's energy needs by 1990.
The first payment, $115 million, is due in 1986, said Don Waters, assistant chief engineer for electricity with the DWP.