California drought: Massive water fee hikes thought-about by Bay Space businesses

Dry California Governor

Through the first three years of drought, Bay Space residents have endured brown lawns, shorter showers and soiled vehicles. Now, because the disaster stretches into the fourth 12 months, they’re about to really feel it of their wallets.

Three of the biggest Bay Space water businesses — the Santa Clara Valley Water District, the East Bay Municipal Utility District and the San Francisco Public Utilities Fee, which runs the Hetch Hetchy system — all are contemplating water fee hikes of as much as 30 p.c this 12 months.
The businesses — which serve 5.eight million individuals, or about 80 p.c of the Bay Space’s inhabitants — say they should enhance charges as a result of they’re promoting loads much less water as prospects preserve due to the drought.
“We do not wish to increase water charges,” mentioned Beau Goldie, CEO of the Santa Clara Valley Water District, which gives water to 1.eight million individuals in Silicon Valley. “However our job is to ensure there may be sufficient clear, secure water to maintain the economic system of Santa Clara County. We will not management the drought.”
As a result of they’ve bought much less water, the businesses have misplaced tens hundreds of thousands of {dollars} in revenues. In addition they have needed to spend more cash on drought-related bills akin to shopping for additional water from exterior the Bay Space to assist meet demand, increasing public relations budgets to ask the general public to make use of much less water amid shortages, and providing rebates to owners who substitute lawns with drought-tolerant crops or outdated, leaky home equipment with water-efficient ones.
The Santa Clara Valley District’s workers has proposed a hike of as much as 31.5 p.c on its “pump tax” — what the district, a wholesale water supplier, fees cities and personal corporations akin to Santa Clara and the San Jose Water Co. The district’s seven-member board will talk about the proposal at its subsequent public assembly on Tuesday; a closing vote is scheduled for Might.

Over the previous 12 months, Santa Clara Valley residents lower water use about 13 p.c. If it hits this 12 months’s 20 p.c objective, the district will lose $20 million in water gross sales, Goldie mentioned. On high of that, the district is spending hundreds of thousands to import extra water from a groundwater financial institution in Kern County.

“Regardless of how a lot water we put by way of the pipes,” he mentioned, “it nonetheless prices the identical to run the water remedy crops and to repair the pipes and to pay the workers.”

Some water officers are fuming concerning the proposed will increase.

“It is stunning,” mentioned Tim Guster, vice chairman and normal counsel of Nice Oaks Water Co., a non-public firm in South San Jose that buys water from the district. “It is too straightforward to say that their prices are all fastened. The reality is they don’t seem to be. It is the responsibility of this and different authorities businesses to manage their very own prices.”

Guster mentioned the district ought to contemplate issues like delaying lower-priority development tasks or dipping into its finances reserves, which the district says whole $557 million.

That is what the Contra Costa Water District is doing. Regardless of shedding an estimated $26 million in water gross sales and different prices related to the drought, the company will cowl these prices by lowering its reserve fund and refinancing debt moderately than mountaineering charges, mentioned Jennifer Allen, spokeswoman for the Contra Costa Water District.

Taxpayer teams say that property homeowners within the districts can typically overturn fee hikes below Proposition 218, handed by California voters in 1996. Each Santa Clara Valley Water District and EBMUD should maintain mail-in elections below Proposition 218 in the event that they go ahead with the speed hikes. The hikes additionally will be overturned in courtroom if they’re discovered to lift more cash than it prices the company to offer the service.

“If the water charges should be elevated to safe the water for his or her prospects, they’ll most likely justify that,” mentioned Jon Coupal, president of the Howard Jarvis Taxpayers Affiliation. “If it is only for bloated overhead, then somebody ought to look into that. I do know that the particular districts within the Bay Space have a status as being, let’s assume, not very cautious with taxpayer {dollars}.”

The Santa Clara Valley Water District in recent times has been the topic of a number of essential county civil grand jury studies which have referred to as into query undertaking delays, excessive salaries for high officers, and questionable spending — such because the district’s resolution in 2008 to spend $1.four million constructing a gazebo and “out of doors training heart” on a vacant lot in Alviso. In January, the board gave Goldie a $10,000 increase, bringing his annual wage to $290,000. The subsequent month, it gave him a $19,605 bonus.

For his half, Goldie mentioned the company has labored to chop its prices, lowering the variety of staff from 903 5 years in the past to 731 now.

In the meantime, the 1.three million prospects of EBMUD in Alameda and Contra Costa counties lower water use 12 p.c over the previous 12 months. Together with the worth of bringing in new federal water from the Sacramento and Placer County areas, that value the district $25 million.

EBMUD, which raised charges 9.5 p.c in July, will start discussing a further eight p.c enhance at its March 24 board assembly, together with a further “drought surcharge” of eight to 25 p.c extra. The board will make a closing resolution April 14.

“We have gone by way of these first years of drought with minimal monetary influence on our prospects,” EBMUD spokeswoman Abby Figueroa mentioned. “However with one other 12 months of drought, the water reserves are down, and the monetary reserves are down. And prospects are going to have to chop again and foot extra of the invoice.”

Reactions to the proposed water fee hikes from Bay Space residents ranged from numbing acceptance to boiling resentment.

“Actually, it is irritating. We’re attempting to do our greatest,” mentioned Albany resident Olga Miranda, who applauds Alameda County residents for his or her water conservation efforts however doesn’t assume that companies have been held to the identical strict requirements.

San Ramon resident Kristina Teves mentioned she would like that the districts first attempt to trim prices however “not on the expense of jobs or impacts to service.”

The Bay Space’s largest water district, the San Francisco PUC, introduced final month that it plans to extend charges 32 p.c this 12 months on the 26 cities and personal corporations it delivers water to alongside the Peninsula, the South Bay and southern Alameda County. A lot of that enhance can be to offset $25 million in misplaced water gross sales after residents lower water use 11 p.c final 12 months.

Steve Ritchie, the fee’s assistant normal supervisor, mentioned that the fee, whose board will vote on the plan in Might, is altering its fee construction to restrict wild value swings by placing extra of the prices on a set month-to-month cost, moderately than having practically all of it primarily based on the quantity of water used.

Some Bay Space residents assume that larger charges may very well have an upside by forcing lots of the remaining water-wasting residents and companies to show off the faucet.

“Folks must get up and perceive that their actions have a value,” Walnut Creek resident Patricia Zuker mentioned. “Typically which means charging them extra. Some individuals will not get it in any other case.”

RATES GOING UP?

Administrators of the Santa Clara Valley Water District will talk about mountaineering water charges at Tuesday’s assembly, which is able to start at 6 p.m. within the boardroom at district headquarters at 5700 Almaden Expressway, San Jose.

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