I represent mutual companies that deliver water to their members for domestic or irrigation purposes. These companies face challenges in governance and water management.
Some form of mutual or cooperative water company exists in all 50 of the United States. They are common in rural areas, but also provide water services in urban or suburban areas in many states. In California, there are approximately 1,200 mutual water companies, with 1,100 of those providing domestic water supplies to homeowners. There are a similar number in Texas, where the companies are known as water supply corporations. I have formed or reorganized dozens of these companies and assisted many more with governance and water supply challenges. Over the past 15 years, I have represented more than 100 mutual water companies.
I have written extensively about mutual water companies on my blog. Selected posts include:
- California Mutual Water Company Basics
- FAQs for California Mutual Water Companies
- Water Transfers by California Mutual Water Companies
- New Requirements for California Mutual Water Companies
- New Law AB 240 Affecting California Mutual Water Companies
- Accounting Practices Under AB 240 for California Mutual Water Companies
Common legal issues facing mutual water companies include company-member relations, compliance with drinking water regulations, water rights and supply management, and difficulties in obtaining capital financing. Because most companies are relatively small, their governance is similar to closely-held corporations and may include inter-personal conflict and regular voting disputes. In most states, mutual water companies are under the legislative radar, but they have received significant attention in California since 2011.