Court says MWD owes county water authority $231.7 million

A San Francisco Superior Court judge ruled late Friday that the Metropolitan Water District of Southern California owes the San Diego County Water Authority $43.4 million in prejudgment interest, in addition to the $188.3 million awarded on Aug. 28 as contract damages for illegal rates MWD charged from 2011 to 2014.

The order brings the amount MWD owes the water authority to $231.7 million.

Ramona Municipal Water District is one of county water authoriey’s 24 member agencies.

Judge Curtis E.A. Karnow ruled that the water authority is entitled to 10 percent interest annually on money that MWD overcollected, applying the mandatory prejudgment interest rate set by the state Legislature to encourage defendants to pay their debts on time. The post-judgment interest rate is 7 percent annually, meaning the total amount due to the water authority under the court’s final judgment would continue to grow until MWD pays what it owes.

MWD argued it owed only $4.16 million in prejudgment interest. The water authority argued it was owed $43.4 million. Karnow awarded $43,415,802.

Added to the damages Karnow awarded in August, this fixes the final judgment amount at $231,711,404.

Karnow’s ruling will be incorporated into the final judgment concluding the two cases, which is expected to be entered later this year. Once final judgment is entered, MWD will have 60 days to file an appeal.

MWD already has said it will appeal the trial court’s decision, a move that could significantly delay payment of the Water Authority’s judgment.

Additional information about the case, including court documents, is posted at www.sdcwa.org/mwdrate-challenge.