Like all of our Central Valley service areas, our Visalia District is experiencing high growth rates. In 2006, it added 2,000 new customers. In total, we added 5,000 customers in existing service areas in 2006.
As for acquisitions, only one met our strict criteria in 2006. In August, we completed the acquisition of the assets of the Independent Utility Company, which has added 400 metered connections 15 miles east of Albuquerque, New Mexico. In 2007 and beyond, we will continue to pursue quality systems that complement our core business and increase value for our stockholders.
On the non-regulated side of the business, our new Extended Service Protection (ESP) program was very well received. More customers than anticipated signed up for this voluntary program, introduced throughout California in 2006. For a monthly fee of $4.95, we repair or replace the portion of the water line that is the customer's responsibility if it is damaged by tree roots, age, earthquakes, or freezing temperatures. Not only does ESP add to non-regulated revenues, it also provides a valuable service that customers truly appreciate. As one customer said of signing up, “I decided to err on the side of caution, because I was very recently widowed and there was also a very large tree in my front yard. I'm so glad I signed up for ESP; it helped tremendously when that tree's roots destroyed my water line. I know if I had to pay for the repairs out of pocket, it would have been very expensive.”
Perhaps the most significant source of growth in a regulated utility such as ours is our investment in water system infrastructure. Because we earn a return on invested capital, our return grows when we invest more in improvements that benefit our customers. In 2006, we spent $86 million on capital projects, including a new treatment plant in Bakersfield, an arsenic standard compliance project in Stockton, and 10 new wells. Our capital budget for 2007 is expected to exceed $80 million, and an upward trend for 2008 and beyond is likely, as we continue to replace aging infrastructure and enhance our systems to meet new water quality standards.