Residents Sue to Prevent Water Agency Transaction

Four residents filed suit Monday to stop the Castaic Lake Water Agency from buying a local water company for $63 million.

The plaintiffs--Jill Klajic, Lynne Plambeck, Jackie Bettencourt and Joan Dunn--want the Santa Clarita Water Co. to be acquired by the city, which they believe would be more strict in granting water rights to new development, Klajic said.

Klajic, a Santa Clarita councilwoman, will ask the council to join the suit at its meeting tonight. The lawsuit contends that state law prohibits the Castaic Lake Water Agency from buying a water retail company such as the Santa Clarita Water Co., stating that the water agency is only allowed to sell water from the state water project to water retailers.

Castaic Lake Water Agency officials have argued that they can sidestep that law by setting up another group of water agency leaders that would oversee company policy. The Santa Clarita Water Co.’s employees would continue to oversee the day-to-day operations of the plant.

Water agency spokeswoman Kiza Stratton said a 1990 state law allows the agency to buy and operate a water retailer. But agency officials had not seen the suit and declined comment.