San Jose Water Company has long been eying the municipal water system, formerly the Evergreen Water Company, which the city bought back in 1961, for just a quarter of a million dollars. Though it serves only about 10 percent of the city’s residents, the privately owned SJWC wants to acquire it and gain full control of the water supplied to the city. They’ve even offered $54 million, plus a $4 million franchise fee per year, or to rent the company for $25 to $40 million.
Considering a report by City Manager Debra Figone that next year’s budget deficit for the city had just climbed from $41 million to $70 million, the offer seemed tempting, but City Council voted no. Instead they decided that 10 percent of the municipal water company’s revenue would be better off going into the city’s overburdened general fund, adding about $2.5 million per year. Councilwoman Rose Herrera suggested that the city seek voter approval for such a move. She was opposed by Councilman Pete Constant, who said that the city should leave all the options on the table, considering the impending deficit.
Read More at The Mercury News.