Thank you all for your support in approving the Circle City Water Company (CCWC) purchase. Voters have approved the May 15th Water Election, authorizing City Council to complete negotiations with the CCWC for the possible acquisition of the utility. According to preliminary results released by the Maricopa County Recorder’s Office yesterday, 80% (14,676) of registered voters voted yes; 20% (3,615) voted no. Official final results are expected from the county by Friday, May 18. The City Council will meet to canvass the votes at a Special City Council Meeting, on Tuesday, May 22. This meeting will begin at 4:30 p.m., and will be held in the Community Room of City Hall, as Council Chambers will be closed for pre-scheduled equipment upgrade work.
As everyone is receiving their ballots for the May 15th Water Company election, I have begun to see an increase in questions regarding the acquisition. To clarify some confusion, here are some of the frequently asked questions that the Council and staff have been receiving. Should you have a question that is not addressed below, please contact our Water Resource Management Director, Terry Lowe, at (623) 222-6022 or by email at firstname.lastname@example.org. You can also visit our Water Election webpage at www.surpriseaz.gov/waterelection.
Question: I do not receive water service from the City of Surprise. What is the benefit of me voting in favor of this purchase?
Answer: As a member of the greater Surprise community, by voting in favor of this purchase you would help strengthen Surprise’s water position overall, which in turn will strengthen the City’s ability to attract businesses and to grow, therefore raising the standard of living, (for example, home values) for all residents, regardless of who one’s water provider is.
Additionally, the ability to grow the City’s water allocations today is a more cost effective way of growing the portfolio. By acquiring Circle City Water Company, we would grow the City’s annual right to Colorado Water by over 38%. If the City were to seek out water rights when the water is actually needed, the cost of those rights would be much greater. The costs to acquire rights to additional water sources continue to rise.
Question: The informational pamphlet states that the City of Surprise will use its current water assets to fund the purchase of Circle City Water Company. What are these assets?
Answer: The assets being referred to are called long term water storage credits. These credits represent water that is stored in the ground for later use. They have monetary value and are bought and sold, similar to stocks. The City generates credits every year by storing water in the ground. If we are successful in purchasing Circle City Water Company (CCWC), the City will have access to more water in which to store, in turn growing our stored water “bank account” at a greater rate. We plan on selling some of these credits to pay the cost of CCWC.
Question: Have there been any other offers submitted to purchase Circle City Water Company?
Answer: We have a commitment from the seller that if the vote is successful they will sell to us, assuming we can reach a deal.
Question: None of the information provided states the dollar amount for the purchase of the company. What is the price?
Answer: The price cannot be finalized until after the City has been given the authorization to complete negotiations by the voters and Council has reviewed the deal. We anticipate the final price will be in the low eight figures.
Question: Will taxes or water rates go up for current City of Surprise water customers in order to fund this purchase?
Answer: It is the City’s intent to not place the costs of this acquisition on the tax payers or into the Surprise Water utility rates. The City plans to utilize water portfolio assets to fund the acquisition. Even if the vote is successful, the City may elect to not purchase Circle City Water Company (CCWC) if the cost does not line up with what we believe they should be or if it is not within our desired repayment structure. City Council has the final say on both.
Question: What exactly are we acquiring through this purchase?
Answer: The City of Surprise Water utility will be acquiring the entire Company, its customer base, its infrastructure, and its water rights.
Question: If we purchase the company, what are our on-going obligation to its existing customers?
Answer: Upon completion, the City would be obligated to provide water service to its customers; who will become Surprise Water customers.
Question: What happens if we do not reach a deal in the negotiations for the purchase? Do we lose our water credits?
Answer: The City is not giving up anything to acquire the CCWC; if we are not able to acquire them, we will not be selling credits. If we are able to acquire them, we will be using what we gain through the sale to pay for them.
Hello neighbors. I’m Nancy Hayden and I am humbled to serve as your District 2 Councilmember. I’m honored to be able to carry on the hard work and dedication of my late husband Jim. While I miss him dearly, it brings me comfort in knowing I can carry on his vision for making Surprise an even more amazing place to live.
Like Jim, I’m available and here for you! And I want to share the important news about our city with you. I begin with sharing news of an upcoming election that will have an impact on our city’s future water supply.
In May, registered voters will have the opportunity to exercise their right to vote on a way to increase our surface river water allocations to meet future needs.
In support of the City Council’s Strategic Plan goal to “Ensure sufficient water resources for current and future needs,” Council, in November, approved a Special Ballot-by-Mail Election on May 15, in which Surprise voters will decide whether or not to authorize the purchase and acquisition of Circle City Water Company.
If approved, the purchase would be funded through the sale of current and future water portfolio assets. A reminder that Sun City Grand’s water provider is EPCOR and the city only manages the sewer portion of our water bill.
Purchase increases our surface water supply
Circle City Water Company is a small water service company in the northern part of Surprise’s planning area and future water service area. Circle City Water serves approximately 170 customers.
In addition to the company’s existing customer base, Circle City also has a Central Arizona Project (CAP) subcontract that would increase the City’s current CAP allocation of Colorado River water (Surface Water) by more than 38 percent.
Current Surface Water Allocation – 10,249 acre feet per year
Circle City Water Surface Water Allocation – 3,932 acre feet per year
That’s a 38% increase!
Current Surprise water demand is approximately 7,700 acre feet per year, which serves about 16,000 customers. Just like Sun City Grand, not all City of Surprise residents are City of Surprise water customers.
Having a surface water supply is important
In order for the city to pump, treat, and deliver water to its customers, it has to demonstrate that it has an equal amount of renewable water in order to offset the water it pumps from the ground. Surface water from rivers, such as the Colorado River, is considered a renewable supply.
Colorado River water is currently the only renewable surface supply available to Surprise. Having a right to more surface water is paramount to meet future demands.
Should voters approve the purchase and acquisition of Circle City Water, we will grow our surface water portfolio, which means we can service more people as the city grows.
Educational public meetings will be scheduled ahead of the election. Meeting dates and locations will be posted on www.surpriseaz.gov.
An Information Pamphlet will also be mailed out in April to all registered households in Surprise.
- April 16, 2018 – Voter Registration Deadline
- April 25, 2018 – Ballots mailed out to all registered households in Surprise. This is a ballot-by-mail election. The City Clerk’s Office will have a ballot drop-off box available beginning on this date.
- May 5, 2018 – Replacement ballot voting begins
- May 15, 2018 – Election Day
2018 Special Election information is available at www.surpriseaz.gov/waterelection.