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Published on 12/22/1997 All articles from this issue

Purissima Hills board still sitting on buyout offer from Cal Water

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By Carol Tiegs / Town Crier Staff Writer

Purissima Hills Water District at a glance

Failing to reach consensus at its Dec. 12 meeting, the Purissima Hills Water District's board of directors agreed to continued discussion of a purchase offer from California Water Service until Jan. 14.

Key points of the Cal Water offer include transferring Purissima Hills district assets to Cal Water for $1 in exchange for a 30 percent rate reduction that pegs rates to those in Cal Water's Los Altos district.

"By offering $1, we can substantially lower the rates and can return the value of the system to them in 6 1/2 years," said Rick Steele, Cal Water's Los Altos district manager.

The current rate in the Los Altos district is $1.47 per unit. Each unit equals 748 gallons of water. Purissima Hills Water District recently reduced rates to $1.65 per unit for 1-10 units, and $1.85 per unit for 11-30.

Cal Water would also set aside reserve funds for future capital improvements in the Purissima Hills district and offer jobs to the district's seven employees.

Steele said Cal Water can continue to provide Hetch Hetchy water to Purissima Hills customers. "We have offered to put that in our contract in any way they want it," he said.

"Some think it's not fair and equitable," said Dan Alexander, president of the Purissima Hills Water District board, of Cal Water's offer. Critical concerns for board members include issues of payback and control of the district's interests, he said.

"I'm not sure we're in agreement on what the district is worth," Alexander said.

An independent appraisal would be one way to determine the district's worth, but Alexander said board members are not ready to pay for such an appraisal when they are not sure the deal is going through.

One positive aspect of accepting Cal Water's offer, according to Alexander, is that "Cal Water has water reserves in case of drought. We're still exploring alternative sources."

Neither district feels a need for speed.

"There is no time limit on our offer," Steele said. Cal Water is pursuing acquisition of several other water districts to increase its customer base, he said.

Purissima Hills Water District comprises 2,020 customers in the northern two-thirds of Los Altos Hills.