Bill limiting public takeover of utilities withdrawn

The bill to keep local authorities from buying private water systems via private domain has been withdrawn by the Fresno assemblyman who sponsored it, according to the Monterey Herald.

The bill, introduced last month, would have required a public agency to show that a privately held utility repeatedly broke the law before it could condemn it and acquire it through eminent domain. Current law presumes public ownership of utilities is preferable and places the burden of proof on the private utility to show why its continued ownership is in the public’s best interest.

Assemblyman Juan Arambula, D-Fresno, is a cheap date.  He had received a $500 contribution from the owner of a Fresno water system whose takeover is under consideration. He introduced the bill at the request of a lobbyist for the California Water Association. The CWA represents 42 private water companies, including California American Water Company (late owners of Montara’s water supply) whose system in Felton is being eyed for public takeover.

Arambula said when he introduced the bill that the lobbyist had described it to him as a "technical amendment without any significant opposition". Then he started hearing from folks in Santa Cruz County who felt otherwise. The story doesn’t mention whether any of his own constituents took him to task and I can’t find any mention of it on the Fresno Bee’s site.

UPDATE:  From Friday’s Wall Street Journal:

Water has caught the eye of Wall Street, too. Water-industry stocks rose 24% last year, topping the 11% gain in the Standard & Poor’s 500-stock index, and have slightly lagged behind the market so far this year, according to an index of water stocks compiled by Boenning & Scattergood, a West Conshohocken, Pa., brokerage firm. Over the past five years, water stocks have surged 113%, compared with a loss of 17% for the S&P 500.