Tuesday, April 1, 2008

Board OKs 250 Percent Water Hike

Farm rates to nearly quadruple under plan, increase set for five-year phase-in

By Daryl Kelley

Directors of the Meiners Oaks County Water District voted Monday to raise the water rates of the typical residential customer nearly two and a half times over the next five years, a boost officials said would still leave rates at the tiny district lower than at others in the Ojai Valley.
New rates would also raise the typical agricultural fee nearly fourfold over five years, a hike farmers said could limit production or put them out of business.
The new water rates would take effect July 1 after customers have a chance to challenge them at a hearing in late May or early June.
All property owners in the district will be notified in the next two weeks. The rate increases would be adopted unless a majority of property owners file a protest in writing. Such a protest would halt the process.
The Meiners Oaks District provides water for more than 1,100 residences, 33 agricultural users and several dozen businesses and institutions such as schools, churches and nonprofit organizations. It draws its water from four wells along the Ventura River, and buys back-up supplies from the Casitas reservoir during dry periods.
Before only 10 residents Monday evening, directors unanimously approved a new rate structure aimed at balancing the struggling district’s budget, which has been in the red the last three years because of soaring maintenance costs on an aging infrastructure.
Without a sharp fee increase, the district would have been bankrupt in four years, a consultant warned.
“This is by far the most important vote we’ve taken (in many years),” said board Vice President Jim Barrett. “This will allow this district to continue. Absent this vote, it was only a matter of time before all of us would be buying water from someone else.”
Even with the increase, board President Bill Reynolds said the district’s financial future is dicey, because it is spreading needed increases over five years to make them more palatable, instead of imposing them all right away.
“This is the beginning of a long, long period of hard work,” he said. “I think it’s do-able. We just have to watch the dollars very, very closely. It’s already spent.”
The board delayed a rate increase last November because of the threat of a lawsuit by farmers and taxpayer advocates, who said the district’s budget was being illegally balanced on the back of the district’s few agricultural users.
Reynolds said the new, simpler proposal is fair and removes any basis for a successful suit.
The district’s budget deficit for the fiscal year ending last June 30 was more than $500,000, he said, compared with an overall annual budget of less than $1 million.
Since 2004, the district has drawn down reserves from $2 million to $1.3 million to repair crumbling pipes, valves, meters and tanks. It now faces replacement of a failed half-million-dollar water tank and a faulty $40,000 pump.
Even with the approved hikes, the small community-based water agency will have increased rates only twice in the last 15 years.
Indeed, even some of those hurt most by the increases — the farmers — said it is evident that sharp rate increases were needed to save the district, and avert even higher fees from another provider.
“I appreciate all the work you’ve done, and in the spirit of the common good, I support what you’re doing, but orchards should also fit into the common good,” said fruit grower Camille Sears. She threatened a lawsuit when the original rate increase was proposed last fall, because fees weren’t based on actual service, as state law requires.
Under the new proposal, Sears noted that 90 percent of the funds for infrastructure improvements would come from the biggest water users, the 33 farmers who use about one-quarter of the district’s water although they are a tiny fraction of total customers.
“I don’t know any grower who can continue to do what they’re doing under this,” she told the board Monday.
Sears said in an interview that she started planting eight acres of tangerines 11 years ago. “In a worst-case scenario, we’ll take out two-thirds of our 1,500 trees,” she said. “We’ve already taken some out, the youngest first. We’re unraveling what I spent a decade building.”
She’ll take out the district’s 2-inch water meter and replace it with a 1-incher, saving money, she said. And she’s getting bids on what it would cost to drill and maintain a well, as are other growers, she said.
Grower Steve Barnard, the district’s largest customer with 20 acres of avocados, said the increase will shut down a lot of small farmers but that he’ll continue, because he’s spent so much to automate the irrigation system over the last six years.
“I redeveloped it out of oranges,” he said in an interview. “So I’ll have to keep going, but with a lesser profit margin. And I have 45 days to complain.”
Farmers have said charging the large water users for the bulk of the district’s construction projects — while residential customers pay the bulk of daily operating costs — is not fair, because they have no choice but to water their crops, or to let them die.
The new fee formula hikes the base rate for residential customers from the current $21.20 a month to $28.52 for the fiscal year beginning in July to $50.41 over five years, officials said.
By comparison, the $28.52 rate for next fiscal year compares with the current rate of $38.01 for residential customers in the Ventura River district, $41.84 in the large Casitas district, $77.84 in the Golden State district that serves Ojai and $114.98 for the Carpinteria district, officials said.
But for 33 agricultural customers, some farmers say the increases could force them to trim irrigated acreage or to halt farming altogether. The farmers’ average monthly rate for a 2-inch line irrigating five acres with 3 acre-feet of water a year is now $193.35 in Meiners Oaks. It would increase to $457.33 in July and to $759.10 in five years.
Still, that compares with the current $502.13 monthly bill for the same service by Casitas and the $1,085.83 tab in Carpinteria, officials said. Comparisons were not available for the Ventura River and Golden State districts, they said.
District officials maintained that its new rates would be fair because everyone would pay the same for water, with the difference in fees being based only on the size of a customer’s water meter and how much water is used.
That would jibe with a state Supreme Court decision interpreting a 1996 statewide proposition that requires that all water customers be treated equally and that they pay for the cost to deliver their water, district officials said.
And they said that if things improve during the next five years, adjustments can be made to reduce the hit on those bearing the burden.
“This is not written in stone,” said Director Karol Ballantine. “But this is the best we can come up with at this point in time.”

10 comments:

Anonymous said...

Goodbye agriculture, hello new construction. That was the plan all along. if you believe otherwise, you probably believe in the Tooth Fairy, too.

I'll be so glad when all Americans are buying their food from other countries where the people mostly hate us. Then, we can be dependent on people lke that for our food as well as for our energy needs. Won't that be a treat?

Anonymous said...

Just like everything UP UP and AWAY!

Anonymous said...

Best to prepare for this as did the FLOW water citizen meeting response to Golden State Water billing campaign. Otherwise your quality of life in the valley is being dismantled by these
water and developnent interest.PL

Anonymous said...

Pete, did you do as I asked and inquire at CMWD about why they wouldn't take the Golden State infrastructure for free? If so, what did you learn? If not, why do you reject the opportunity to learn how much things really cost?

Here, I'll do some legwork for you: this is the salary search for LADWP http://lang.dailynews.com/socal/ladwpsalaries/

Be sure to look up Waterworks Engineer, Surveyor, Civil, Mechanical, Structural, Electrical Engineers, Drafters, Geologists, etc. What would you guess a staff would cost? Here is your chance to find out. And then you will have to relocate them here. More high-earning "newcomers" to drive up housing. Something to think about, Pete.

Did you get the part where the article says this "..would still leave rates at the tiny district lower than at other in the Ojai Valley."? What do you think about it?

Participation in FLOW is great, I wish FLOW well, but it seems like a lot of people just want cheap water and to get it they don't care if the rest of us get dragged into the boondoggle quicksand.

Anonymous said...

So what would be the alternative to
neighborhood and ratepayer organizing such as the FLOW group?
Could grass roots ownership be done
and still avoid staff and equipment
costs or the 250% rate increase?
That group may provide answers
and a series of town meetings
sheding light needs to happen again. But the broader issue is valley (and U.S.) natural resource and energy independence. Otherwise we see the endless wars and economic meltdowns.PL

Anonymous said...

FLOW, and ratepayer groups in general, are fine as far as they go. They are not a problem, but they certainly aren't a solution. Like most people, they don't bother getting educated on anything other than the cost they pay.

There are some things only money can fix. Waterworks (and any infrastructure project) has only three variables: scope, schedule and cost. (The replacement can be delayed, but it will cost more later; or, the cost can be reduced, but the scope will have to be reduced, etc.)

Every water system in the country is faced with this problem. This is a perfect example of Ojai Valley being special, but the problems it faces are quite ordinary.

James Hatch said...

PL,

I have to agree, the problem is energy self-sufficiency versus energy dependence.

Comparing the costs of the LADWP to those of a small water district is ridiculous. By way of example, compare the salaries of Ojai city council members to those of L.A. city council members.

Anonymous said...

"it seems a lot of people just want cheap water and to get it they don't care if the rest of us get dragged into the boondoggle quicksand." OK well it seems that
comments like this come from those
who want to privatize and profit from a public resourse. PL

Anonymous said...

Pete, your last comment makes no sense.

Did you do as I asked and inquire at CMWD about why they wouldn't take the Golden State infrastructure for free? If so, what did you learn? If not, why do you reject the opportunity to learn how much things really cost?

Anonymous said...

I am learning about local water politics starting from OVNews pieces and responses on this blog. My last post was a simple to read comment on the privatization of public water.Thank you for your continued interest in informing folks about ongoing changes to water rates and dynamics happening here now. PL