May 10, 2012 Dear CEWR Members, You joined the team and made us a powerful force against

corporate greed. Because of you, the Coalition has been able to aggressively challenge Canyon Lake Water Companys request for a massive 71% rate increase and force a rate hearing before two Administrative Law Judges (ALJ) appointed by the State of Texas. Thanks to you, the Coalition was able to prepare a compelling case in the formal rate hearing, strongly challenging the seven (7) major financial issues CLWSC has raised in the rate increase filing. These accomplishments would not have been possible without you. The Coalitions water rate analysts and lawyers were exceptional in the recent formal rate hearing, impressing and convincing the Judges with our research and facts that demonstrate the rate increase is NOT justified. We have made an effective case against all of Canyon Lake Waters claims. The Texas Commission on Environmental Quality (TCEQ) staff strongly supports us and has testified at the recent hearing, agreeing with us on virtually all issues. They are recommending a rate order that is very close to CEWRs position that a total increase of less than 21% is fair. Our protest has sent a powerful message to the California water company that demands windfall profits for our water they should not get rich providing a basic public service to rural Texans. We are continuing the fight but more funding is needed to finish the battle. An additional $25,755 is needed to pay our rate analysts and lawyers to finish the fight and prevent Canyon Lake Water from getting the 71% rate increase. Please donate $50 or $100 so we can continue to deliver our strong and compelling case to the Judges in the final rate hearings events (next page). Canyon Lake Water has used every legal maneuver to exhaust our funds so they can defeat us by running up the cost of the rate case. Lets show them that their under-handed tricks wont work in Texas. With good people like yourselves, and your generosity, we will not have to go away defeated because we lack the critical funding to continue when winning is in sight. Please make a donation today for the win at the final hearings and the defeat of this 71% rate increase. You will save yourself hundreds and hundreds of dollars a year, and just as important, help set the baseline for future fair water rates. Highest regards,

Geoff Miller Major General US Army (Retired) President, CEWR P.S. You can go to www.CEWR.org and hit the Make a Donation button to donate or return your check in the enclosed envelope. Please include your email address on your check so we can keep you informed.

WWW.CEWR.NET

830-542-WATR

CEWR Critical legal events to win the final rate order

May 12 July 12

The Challenge
$ 9,895 $ 4,975

Sep 12

Nov12

Briefs/Reply Briefs written briefs and closing legal arguments to the Administrative Law Judge (ALJ) Rate Case Expense Hearing separate hearing to challenge CLWSCs rate case cost claims they want to charge the ratepayers in addition to their requested rate increase. Briefs/Reply Briefs - the final closing arguments by both sides to the ALJ that can decide final rate order recommendation to the TCEQ Commission. Proposal for Decision- ALJs written discussion and evaluation of expert testimony and evidence presented at the hearing. ALJ makes comprehensive finding of fact and conclusions of law on all contested issues to the full TCEQ Commission for approval of the final water rate order. TOTAL

$ 2,945

$ 7,940

$ 25,755

Feb 13

TCEQ issues final rate order. Thanks for being an integral part of the team.

Please donate now and help us win the final decision!

WWW.CEWR.NET

830-542-WATR