Ojai Farmers Stuck With Huge Hike

Growers begin paying 53 percent more tomorrow

By Daryl Kelley
Confronted by dozens of farmers asking for relief, directors of the Casitas Municipal Water District instead imposed a 53 percent hike in the cost to irrigate crops, but also pledged to work closely with growers to get rate hikes under control.
Predicting a change in the nature of the Ojai Valley, farmers told the Casitas board Wednesday that its decisions on water rates might herald the beginning of the end of orchards that have encircled the valley’s towns for a century.
“Everybody will find ways to change, or they’ll go out of business and there will be just dead trees standing there,” said grower Jim Finch. “And it will change the nature of this valley.”
Casitas directors sympathized, vowing to work with farmers on a new way to charge for water.
“Yeah, the 50 percent increase is a whopper, we agree,” said board President Russ Baggerly. “And we accept the challenge for a dialogue ... to find solutions.”
Still, the new water rates will be imposed beginning tomorrow.
And, even with months of reconsideration, it won’t be easy for Casitas directors to craft a new set of rates that are equitable for farmers, businesses and residents, because a shift of costs from one group would affect the other.
For example, under the new rates, water costs to residential users supplied directly by Casitas in the Oak View area remained the same, because officials say homeowners already pay for the full cost of delivering their water. Farmers will still have a much lower rate than residents even with the 53 percent increase.
“The rates did not go up for residential users,” Baggerly said. “They’re paying their fair share.”
But farmers said the board’s rate hikes for agriculture ignored the history of the Casitas district, which was formed a half century ago partly to supply water for local farms. And they said the water district had taken the easy way out by putting the bulk of a budget increase required to patch an aging waterworks on the backs of about 200 farmers. That avoided a backlash from 2,600 residential customers in and around Oak View, they said.
East valley rancher Roger Essick called the rate increases “grossly unfair,” arguing that water costs should be allocated by the number of water meters held by those who benefit from the Casitas system, including residents of Ojai, Mira Monte and Ventura. Costs are now levied primarily on how much water a customer uses, as is the case with nearly all of the water districts in California.
“They’re not paying their fair share for the cost of upkeep,” Essick said of residential customers.
Indeed, he and neighboring farmers Jim Churchill and Jim Coultas proposed a dramatically different method for establishing rates.
Under their plan, detailed by Coultas, administrative and maintenance costs would be parceled out to every customer, direct or indirect, who benefits from Casitas water, even if those customers are in other water districts, such as Golden State’s in Ojai, the city water department in Ventura, or the water agencies of Meiners Oaks, Mira Monte and Casitas Springs.
That would mean that thousands of residential customers could have their rates increased to lower the bill to farmers. Casitas provides water for about 65,000 people at 29,000 households and for nearly 5,700 acres of farmland in the Ojai Valley and Ventura area.
But farmers use 44 percent of the district’s water, while customers in Ventura use about one third. And those two groups took the big hit this week, farmers with a more than 50 percent increase and the city of Ventura with a 30 percent hike. Indeed, Ventura officials expressed frustration that they had not been warned of the big increase and now can’t afford to buy as much water from Casitas.
Casitas officials said Ventura and the district might consider renegotiating how much water Ventura receives each year.
But the Coultas, Essick and Churchill plan received the most attention for future discussions.
“This is real important stuff, more so than trucks or chain stores,” Coultas told the board. “It has the potential to change the very character of our community.”
A former Casitas director himself, Coultas asked the board to go through its budget line by line to determine “if this cost is a factor of the water used or is it a factor of the service received.”
In other words, should farmers paying by volume be charged to maintain pipes, pumps and tanks that provide water to nine retail companies that provide water to nondistrict customers? And should farmers be charged to maintain the waterworks that also provide backup water in times of emergency for thousands more homes?
“Let’s see if we can’t come up with a new way,” Coultas said.
And while the board seemed receptive, directors also defended their current method of calculating rates.
“You’re absolutely right, people in Ventura and Ojai don’t want to see this valley go barren,” Director Bill Hicks said. “We don’t want to run you out of business.”
But it’s also true that residents had paid nearly three times as much for their water, based on volume, than farmers before the new increase, Hicks said.
“We’re between a rock and a hard place,” he said.
And after the hearing, Director Richard Handley said he’d taken Coultas’ formula for redistributing costs and applied it to his own situation as a resident of Ojai, who is not a direct customer of Casitas.
“My rate would go up six-fold,” Handley said, from about $298 a year to $1,894. Handley lives in a three-bedroom house and does not irrigate his lot. “This plan doesn’t work,” he said.
Casitas directors are also faced with the challenge of how to implement a 2006 State Supreme Court decision in which justices ruled that Proposition 218, passed by voters in 1996, requires equitable distribution of water costs.
Even with the farmers’ rate proposed to increase from $208 an acre-foot to $312, they would still pay far less than the $667 charged to residential customers. (An acre-foot of water meets the needs of two typical households for a year.)
Casitas officials have said they might be able to legally justify the lower rate because agricultural users do not need the high quality water delivered to their orchards since a sophisticated treatment plant was built a decade ago to meet state drinking-water standards.
If all costs, including treatment, were included, farmers would pay $521 an acre foot, 150 percent more than they pay today, analysts said.
The new $312 farmers’ rate covers the bulk of their water’s $365 basic cost, but none of the $165 per acre-foot treatment cost, officials said.
Rancher and restaurateur DeWayne Boccali said that even if there is a subsidy to farmers, such subsidies are common in the United States, and valley residents need to take care of agriculture or it will go away.
“In some cases you just have to take care of your own,” he said, “and subsidize your farmers. ... Agriculture is an important thing if you like to eat.”
But many farmers see Proposition 218 in a different light.
Coultas, Churchill and Essick wrote: “We believe that in attempting to apply Prop. 218 ... you have done exactly what Prop. 218 was meant to prevent, which is unfairly load a disproportionate share of the costs onto one class of user. ... We believe that your current model and proposed rates cause agriculture to subsidize other classes of user.”
Churchill said he thought the farmers would now have a chance to make their case with Casitas over the next year.
“I think we will have an opportunity to go through their budget line by line,” he said. “I gather they’re eager to work with us within their constraints.”