On September 10, Central Arkansas Water (CAW) staff presented the results of a Feasibility Assessment relating to the potential consolidation with Maumelle Water Management (MWM) to the CAW Board of Commissioners. CAW staff presented the results of the Assessment to the MWM Board of Commissioners on September 22.
The purpose of the Assessment was to evaluate if consolidation of the water systems of MWM and CAW benefits customers of both systems.
The Assessment found that consolidation with CAW would allow MWM to addresses the significant water-related capital funding shortfall that persists even after implementation of rate increases proposed earlier in 2015 by MWM (options of a 48.5% or a 27.5% rate increase spread over three years were proposed). Upon connection to the CAW distribution system, CAW would be able to provide MWM a sufficient supply of water that will satisfy Maumelle peak water demands at full build-out, eliminating the risk of water shortages experienced in 2012 by MWM, and eliminating the costly water supply and treatment capacity expansions necessary to address these capacity issues.
Consolidation would allow CAW to utilize stranded capital investments in the vicinity of MWM’s service area as well as available supply and treatment capacity made available by reduced wholesale demand. The addition of 10,500 accounts would also benefit CAW financially through the added revenue stability as well as an additional return on the utility’s rate base. Consolidation with MWM would have little long-term impact on CAW’s capacity. Even at full-build out, MWM’s peak demand represents only 6.7% of CAW’s treatment capacity.
Following the presentation, the MWM Board requested that CAW present the information at a public meeting for residents of Maumelle. The date and location of the public meeting have yet to be determined, but CAW will update its site with this information when available.