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San Diego County Water Authority Announces MWD’s Rates Violated State Law

A judge has upheld his ruling in a lawsuit against the Metropolitan Water District that found the MWD's rates violated state law, the San Diego County Water Authority announced Friday.

San Francisco County Superior Court Judge Curtis Karnow on Thursday affirmed his Feb. 25 tentative ruling that stated MWD rates imposed since 2011 violated several statutes and Proposition 26, which sets the conditions for which taxes and fees can be increased, according to water authority officials, who filed the suit alleging the MWD illegally assigned unrelated water supply costs to its water transportation rates.

"We've said all along that MWD is not above the law,'' SDCWA General Manager Maureen Stapleton said. "I hope that Met's board of directors listens to a judge saying the same thing and conducts a real, independent cost-of-service study and sets rates that comply with the law.''

MWD General Manager Jeffrey Kightlinger said following Karnow's tentative ruling that MWD was confident its structure of charging all agencies the same rates for the same services was both logical and legal.

"We look forward to the coming steps in the judicial process to demonstrate that a rate structure that fairly and equitably recovers all the cost of delivering safe, high-quality and reliable water is in the interest of all Southern Californians,'' Kightlinger said.

Karnow's decision set May 16 as a scheduling date for the second phase of the trial, which is expected to determine the disposition of disputedpayments the SDCWA has made since 2011.

The local water authority first sued MWD in June 2010, and then filed another lawsuit in June 2012 because the prior case had not been resolved and rates adopted for 2013 and 2014 were based on the same formula.

The water authority board voted unanimously at its meeting Thursday to authorize another lawsuit against MWD over rates it adopted for 2015 and 2016 using the same illegal methodology. Water authority officials alleged that if allowed to stand, MWD's rates for the next couple years would overcharge ratepayers by about $92 million.

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