PUCN Jurisdiction Corrections and Clarifications: Some people have suggested that TMWA should be regulated by the Public Utilities Commission of Nevada. Their reasoning: customer representation. In response, the TMWA Board of Directors has agreed to formalize a Standing Advisory Committee, which is made up of customers from all rate groups. They will review all proposed rate increases and report!their recommendations to the Board.In addition, TMWA will continue a formal process for any future rate increases. There are many reasons why a move to PUCN regulation would be undesirable to TMWA and its customers including:
- Members of the TMWA Board of Directors are elected officials or their direct appointees - a group of local people who are much more accessible and accountable to the customers than the Public Utilities Commission in Carson City;
- The municipal bonds used to buy TMWA were purchased with the understanding that the TMWA Board would have control over the rates to protect the bondholders' investment. In fact, the Purchase Agreement specifically addresses changing the make-up of TMWA from a Joint Powers Authority to a municipal utility should the agency be forced under PUCN control, with the specific intent of prohibiting PUCN jurisdiction and protecting bondholders;
- TMWA's bond rating would degrade, preventing or deteriorating further bonding or borrowing capacity;
- The bond market would look very unfavorably upon not only TMWA, but the State of Nevada, for changing the governance of the water authority after making the deal to buy the bonds;
- Costs would definitely go up to fund the additional TMWA staff needed to address regulatory processes;
- PUCN regulation exists for other utilities to balance the interests between customers interests and corporate shareholders' profit interests.TMWA is a not-for-profit public agency owned by the customers, so there are no compelling profit interests.
