Ramona Municipal Water District Board’s decision to propose raising water rates 12 percent, San Vicente sewer rates 10 percent, and Santa Maria sewer rates 12 percent was not without disagreement and debate among board directors.
Presented with three options for increased water and sewer rates, district directors determined which they want built into the fiscal year 2010-11 budget.
Rate increases will not be final until the budget is adopted. A public hearing to give customers an opportunity to voice their opinions is scheduled for May 25.
With issues of establishing funding for deferred maintenance and improvements to facilities, the directors during their budget workshop last Tuesday reviewed charts prepared by David Barnum, the district’s chief financial officer, showing rate increases ranging from 8 to 12 percent.
The biggest disagreement concerned rates for customers of the Santa Maria Sewer Service Area (SMSSA), with Jim Robinson, board president, pushing for the 8 percent increase while Division V Director Red Hager opted for a 12 percent increase.
With both water and sewer rates going up, Robinson, who represents Division IV that covers a portion of the downtown area and many businesses, said that the average customer is going to pay over $100 more a year.
“I don’t know about you,” Robinson told Hager, “maybe you’ve got a million dollars to pay for increases in rates, but I don’t, and I don’t think most of my people in my district do, either.”
Hager expressed concern over the improvements at the SMSSA as required by the Regional Water Quality Control Board (RWQCB), and the need for funding.
“We’ve been getting these complaints year after year,” Hager said, referring to the RWQCB.
He said the district keeps delaying the work.
“A lot of the delay is the environmental stuff we have no control over,” responded Robinson, noting he never dreamed the district would have to pay about $400,000 for environmental studies.
In December 2009, the water board agreed to move forward with Phase I improvements at SMSSA, estimated to cost between $10 million and $13 million. The improvements will increase capacity to meet the RWQCB’s 2005 criteria.
District Engineer Tim Stanton said the final design plans for Phase I should be ready in August or September. With permit approval and bidding scheduled for early next year, construction is slated to start in March 2012.
The current rate for Santa Maria customers is $512.99 per equivalent dwelling unit (EDU) per year. The fee is added to the property tax bill. The EDU is based on the amount of wastewater effluent so, while a single-family residence is charged one EDU, a business such as a restaurant could be charged two or three EDUs.
A 12 percent rate increase this next fiscal year would mean an additional $61.56 per EDU annually for Santa Maria customers.
Robinson noted that most businesses pay more than one EDU. “Are we going to make it tough on them?” he asked. “They’re having a tough time already.”
The rate for Santa Maria customers was increased 8 percent last year in anticipation of the Phase I improvements. Barnum said an 8 percent increase this year would double the amount of the rate stabilization fund for the expansion project, bringing it to nearly $760,000. A 12 percent rate increase would boost the fund to approximately $846,000.
Division II Director George Boggs said the board needs to build up the fund. “The problem doesn’t get smaller as we go down the road,” Boggs said, to which Robinson agreed, but added, “We don’t have to solve it all in one budget.”
Division I Director Darrell Beck said he thought the goal was to increase the rate a certain amount with each budget.
Hager’s motion to increase the rates for Santa Maria customers to 12 percent passed 4-1 with Robinson casting the dissenting vote.
Hager also proposed to increase the rates for San Vicente customers 10 percent, while Beck suggested an 8 percent increase.
At issue was the cost for brine hauling and the district’s plan to install brine ponds to eliminate the cost of hauling. The board approved the 10 percent rate increase, 5-0.
With water rates, Barnum noted RMWD purchases water from the San Diego County Water Authority (CWA), which purchases from the Metropolitan Water District of Southern California (MWD). When the MWD increases its rate, that increase is passed through the CWA, RMWD and to the customers, Barnum said.