By Gerardo R. Partido
Variety News Staff

CONGRESSWOMAN Madeleine Z. Bordallo has lauded the U.S. Navy’s decision to partially roll back its Fena water rate to $3.25 per kilogallon, retroactive to Oct. 1, 2007.
In August, the Navy announced an increase in water rates from $2.07 to $4.05 per kilogallon due to a statutory requirement for the U.S. Navy to recuperate monetary losses incurred in the water budget during fiscal year 2007.
But the Navy plan had been met by stiff opposition from the Consolidated Commission on Utilities and the Guam Waterworks Authority.
Bordallo sent a letter to the Secretary of the Navy in late September requesting the Navy to reconsider its rate increase.
The news of the Navy’s decision to reconsider its plan came during a meeting last week between Bordallo, Assistant Secretary of the Navy for Installations and Environment B.J. Penn and General David Bice, executive director of the Joint Guam Program Office.
The meeting was arranged to discuss the increase in water rate sales from the Navy to GWA.
During the meeting, Bordallo said Penn and Bice informed her that the Navy plans to decrease its water rates to GWA and the Guam Power Authority immediately.
“Assistant Secretary Penn informed me that his review resulted in a partial rate reduction to $3.25 per kilogallon from the original proposed increase to $4.05 per kilogallon. We appreciate this partial relief and we will work to address the broader water issues on Guam in light of the planned military buildup,” Bordallo said.
The congresswoman also promised to work with Penn and Bice to ensure that Guam’s concerns are addressed as the military moves forward with its buildup on island.
The Navy believes its rate adjustment is a positive approach to the concerns raised by GWA.
The Navy said the rate of $3.25 it now proposes reflects its actual projected cost of producing water and is the lowest that can be charged.
After further review of the earlier proposed $4.05 kgal rate, the Navy said it decided to defer the recovery of prior year losses and phase that recovery over multiple years to lessen the rate increase and provide greater rate stability to GWA and GPA.
The adjusted rate will be unique to GWA and GPA, with the previously budgeted recovery of prior losses to be spread over several years.
The Naval Facilities Engineering Command Marianas will work with GWA and GPA to establish the period of recovery while the Department of Defense and other customers will continue to pay the rate of $4.05 kgal.
The Navy adjusts its water rates every year to match the fluctuations in production costs.
Just like during the water supply challenges during the dry season and the past challenges with high turbidity and plant repairs, the Navy said it would continue to work closely with GWA, GPA and CCU authorities to seek “mutually beneficial” results.