Tough Tug of War Over the Control of Water Company : Utilities: Corona and Elsinore Valley Water District each says it needs the Temescal Valley company to improve the quality and quantity of product it sells.

To Corona, Lake Elsinore’s municipal water district is an “empire builder.” In turn, Elsinore Valley Municipal Water District officials call Corona “a rattlesnake.”

Both agencies are fighting over the rights to the Temescal Valley Water Co., which primarily serves 6,500 acres of agricultural land in a region targeted for substantial residential, industrial and commercial growth in the next two decades.

Each side claims it needs the Temescal Valley Water Co. to improve the quality and quantity of the water it now sells. Yet the agencies are accusing each other of trying to wrest control of the company in an effort to control growth--a move that would ultimately add sales and property tax dollars to the coffers of the cities served by the water districts.

The dispute erupted in August, 1989, when the Elsinore Valley Municipal Water District acquired the Temescal Valley Water Co. for $11 million through a “friendly” eminent domain, a means by which public agencies acquire private property with court approval.

At the time, Corona, along with the city of Riverside and two other water districts, were preparing to purchase Temescal and divide its assets among themselves. The two cities and the Lee Lake Water District have since filed four lawsuits against Elsinore Valley, including several claiming that its purchase was illegal.

The Temescal Valley is primarily an agricultural area that runs along Interstate 15 between Corona and Lake Elsinore. Urban sprawl and the need for new revenue has forced both cities to plan expansions of their borders well into the valley. Within the next 20 years, city planners envision the area becoming rich in industrial parks, housing tracts and commercial centers. Each city will need water to serve its new population.

“This is a struggle against destinies,” said Joe Aklufi, an attorney for the Elsinore Valley Municipal Water District. Corona “has been for years an advocate of their own destiny. They don’t like anyone telling them what to do.”

Attorneys for Corona point to Temescal’s close relationship with the city as a reason that it is a logical choice for part of the water company’s assets. The formation of the company a century ago was instrumental in Corona’s early growth, providing water for citrus and avocado crops mainly in the Temescal Valley. The company’s customers are still about 70% agricultural, mainly in South Corona and along Interstate 15.

“The only agency that might be involved in empire building is Elsinore,” said Ron Kohut, an attorney for Corona. “. . . It is costing their customers $500,000 to $1 million a year for the sole privilege of saying they own the Temescal Water Co.”

Part of what is at stake is control of the Coldwater Basin, a high-quality water source in the Temescal Valley near Glen Ivy, where Corona now owns three wells. Temescal owns the other three, and rights to the basin have never been settled in court.

Corona officials say that control of all the wells will enable them to make sure the basin is not overused. Before this year’s March rains, one of Corona’s wells ran dry and another one was about to go dry, said George Thacker, Corona’s utilities director.

Corona officials say their main concern is acquiring additional wells to mix with the city’s ground water. The high-quality water in the basin is mixed with Corona’s water to dilute the nitrates and make it safe for drinking. Without the water source, Corona would have to depend on more expensive, imported water from the Metropolitan Water District.

Corona, along with Riverside and Lee Lake, charge that the Temescal acquisition was illegal because Elsinore Valley board members bought the company without public input and failed to draw up the proper environmental documents. In addition, they say that Elsinore Valley is illegally operating a company outside its original service area. Elsinore Valley officials have called the claims “frivolous” and false.

The state Supreme Court is expected to decide whether to hear one of Corona’s suits, which the city appealed from a lower court last year after a judge ruled in favor of Elsinore Valley. Even with that, the dispute could be in litigation for years.

Corona, Riverside and Lee Lake are now nearing completion of an environmental impact report that will be used to acquire the Temescal Water Co. in their own condemnation action. At a hearing last month on a draft of the report, Aklufi told the City Council that the document failed to address how the purchase of the water company would stimulate growth.

“If a city is in control of its utilities, it is in better control of its growth,” Aklufi said at the meeting. “Since Proposition 13, cities depend on growth, no longer on property taxes. It’s a fact. Growth will result from an increase in water quality.”

But Corona city officials say that the Temescal Valley will grow regardless of who has control of the area’s water company, and say that Elsinore Valley has little reason to have the Temescal Water Co. other than for its own expansion. Attorneys point to Elsinore Valley’s recent application for a $30-million federal loan to construct transmission mains, storage tanks and a pressurized pipeline delivery system, an action they say will bring water far in excess of what is needed to the area.

Lance Adair, another attorney for Corona, said the additional water would be enough to serve 118,000 people, while Elsinore Valley in its loan application projects population growth at 30,000 by 2035.

“They do not need the water for Lake Elsinore,” said Roy Mann, an attorney representing the Lee Lake Water District. “What I think they want to do is get into the water marketing business. (They) want to sell, but for a price.”

Aklufi said Elsinore is simply trying to become less dependent upon imported water.

Company officials also deny that the Temescal purchase was for growth, saying that the Elsinore water district remains autonomous from the Lake Elsinore city government. As an example, Aklufi pointed to a recent refusal of the water district’s board of directors to grant new water meters to new developments because of the drought. The action earlier this year forced the Lake Elsinore City Council to issue a building moratorium and angered council members.

“It’s needed just to meet current demands,” Aklufi said. “It will bring tons of new water. (Elsinore) won’t have to worry about fines and moratoriums.”

Whatever the case, many growers appear to have sided with Corona. Rates have risen 25% since Elsinore Valley took control of the water company.

“We are unhappy,” said Charles Colladay, general manager of about 2,800 acres of citrus groves at Foothill Ranch in South Corona. “As growers, half our costs are tied to irrigation. It’s just going to accelerate growers going out of business.”