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CONTACT: Kyle DeVine            December 18, 1995   CPUC - 562
         213-897-4225                             (A.95-03-012)

    CPUC APPROVES AVR AND JRU MERGER, AND REVENUE INCREASE

    The California Public Utilities Commission (CPUC)
authorized today the merger of Apple Valley Ranchos Water
Company (AVR) and Jess Ranch Utilities, Inc. (JRU).  The merged
company will keep the name Apple Valley Ranchos Water Company
and serve Jess Ranch, the Town of Apple Valley and nearby
vicinity.
    Water revenue increases of $1.3 million or 19 percent for
1996, $295,000 or 4 percent for 1997, and $294,000 or 4 percent
for 1998 are approved to cover increased operating costs.
Authorized rate of return is 10.04 percent for 1996.
    In addition to the merger, in March 1995 the company
requested to raise water rates $1.8 million or 27 percent and
sewer rates $521,000 or 583 percent.  More than 300 of its 783
customers protested because in September of 1993 JRU stated it
would not request a rate increase for 2 years and the request
would be considerably less than 40 percent.
    Today's Commission order keeps the merged company to its
commitment to customers.  Water rates will not be increased
until January 1996, and sewer service rates are not changed.
    JRU and the Town of Apple Valley are working on a
settlement that would transfer JRU sewer service to the town
and the town's water service to AVR.  The transfers should
improve service.  If settlement is reached, sewer customers
would be served and billed the rate set by the town which
would be $12.00.  Currently they are billed $8 by JRU and $7 by
the town.  The 11 water customers the town serves will become
AVR customers and their rates will gradually increase over two
years from the town's current monthly bill of $16.20, for an
average use of 2,700 cubic feet of water, to AVR rates.  This
will prevent an immediate increase of more than 400 percent for
town customers.
                            -MORE-
    In 1996, AVR will bill every month, rather than bimonthly
as it does now.  The residential service charge will increase
to $13 a month.  Existing AVR customers now pay a $24.80
bimonthly service charge; JRU customers now pay $10 a month.
    Water use rates will increase to $0.95 per hundred cubic
feet of water used.  Existing AVR customers now pay $0.81 per
hundred cubic feet. JRU customers do not have meters and are
not billed for water used; however, AVR plans to install meters
for them and will bill for water use once meters are installed.
The residential monthly bill for existing AVR customers who use
the systemwide average of 2,600 cubic feet of water a month
will increase $4.19 or 8 percent from the current $33.46 to
$37.65.  JRU customers will see a $3 increase from the current
$10 to $13 until meters are installed.

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