Posted by: wateruser | May 7, 2009

Millview Water Hearing was Packed

Last night’s Millview County Water District rate review meeting was packed.

Here are some of the highlights of the meeting:

  • Although the district management thought no one would attend, every seat in the room was taken, and a line went out the door. In addition, everyone sat through the meeting, which went well beyond two hours. Clearly, Millview water customers are not happy about these rate increases.
  • Many angry water customers expressed their opposition to the steep rate increases proposed by the district. Some of this anger may have been misplaced (see below) and some was certainly legitimate.
  • Residents of a local mobile home park had been informed by their park management that water rates would increase by $100 per month! Someone obviously slipped a digit in their calculations. Mobile home water rates may increase by $10 per user per month, but nowhere near $100.
  • Some attendees accused the district of fear-mongering and deception – using the current drought conditions as an excuse to raise water rates. One woman suggested that the timing was an odd coincidence. MVCWD’s response was that they tried to keep rates low, and probably went too long without raising them (15 years). It’s actually a pretty good excuse.
  • Another attendee questioned the capital and operational expenses planned by the district, and whether the district had considered the return on investment being made. For example, automated meter reading is an expensive project, but the district stated it would only save four days of labor each month. District consultants added that such metering was “how it’s done these days” but didn’t answer the question regarding return on investment. Sure, it’s cool to have, but is it really necessary right now?
  • Another attendee claimed MVCWD infrastructure costs were due to a few large-scale construction developments planned within the district (such as the DDR on Masonite, Hop kiln, and Mendocino college dorms.) His main point was that the current customers are subsidizing the improvements necessary for these developments. He also had a “pile of reports” to back his claims, and his profession is in water agency management. The MVCWD response came mainly from their engineering consultants who basically stated that you have to anticipate and build for the future. When you put pipes in the ground, you need to size them based on potential future usage, a lot of which cannot be known in advance.
  • A prior member of the Millview water board was present and opined that nothing has changed and no progress has been made since he was on the board five years ago. He had a good handle on the facts, and was most concerned about water flow rates being limited due to a 10 inch main under the Russian River.
  • With regard to how projects would be financed, the district said it would prefer to avoid adding debt (with the associated loan interest expense). However, district financial consultants, the Reed Group mentioned that two $4.5 million bonds for financing may be necessary. According to their recent report, these bonds would be 30 years at 6 percent, with a 4 percent closing fee (seems really high).
  • Another point that came up was that Millview once obtained substantial water free-of-charge from the RRFCD (Russian River Flood Control District), but now gets charged for that water (although the right to do so has been questioned by some.) Also, water rights leases that have supplied the district since its inception have or will expire and apparently had no options for renewal, or for some reason the district did not want to renew them (it was not stated). To outright purchase these water rights is a major expense (approx $2.4M) for the district.

All-in-all it was an informative meeting and many opinions where expressed. The district did a fairly good job at addressing most of the questions and concerns. A master plan is in the works (to be written by consultants) and will provide more information in a few weeks.

Another meeting regarding water conservation restrictions is scheduled for later this month.

Posted by: wateruser | April 30, 2009

Ukiah Millview water district (MCWD) proposes rate changes

The Millview County water district (CWD) in Ukiah, CA has proposed changes to water rates, effective June 2009.

This blog is to ask some questions about these changes, and also to get your opinions.

Disclaimer: This blog and its author are not part of MCWD, and do not represent the district an any way. We are customers of the district, and we provide this page as a public service to families, industries, and other users of the district.

Quick summary:

Here is a quick summary of the changes as they effect water customers:

  • Double the water rates for an “average family” from $344 per year to $681 per year by 2011.
  • That’s a 98% increase!
  • Add more than $14 million dollars of new projects, with millions of dollars of debt to fund it.

As customers of this district, we need to challenge these increases, especially during a time of economic hardship for our area.

It would be reasonable to suggest an increase of 20%. Maybe even 30%, but they want to increase charges by 98%!

Why the changes?

Why do they want to up the water rates? We need to ask some serious questions:

  • They want to purchase more water rights. ($4M) Seems reasonable, but the question is, who are they purchasing it from? MCWD has been around a long time, don’t they already own the rights to the water? Why are they paying excessive prices for these new rights? ($1447 per acre foot)
  • They want to add expensive new equipment. ($2-3M) Right now the economy is contracting. Is this the best time for such expansion?
  • They want to automate the meter reading. ($400,000) Why? Is that really necessary right now? Are they planning to fire someone?
  • They hired costly consultants, who will be costing about $500,ooo over the next couple years. That’s a lot of cash for a small district, and can’t the MCWD do this work itself? Isn’t that why they have a staff?
  • Increased administration costs of 40%. Why?
  • They want to make other capital improvements ($5M), such as move some tanks around, build some roads, update equipment. But, what are the priorities? Does it all need to happen right now?

This is the same pattern we see in the local county and state governments. Hire expensive consultants, who take over and drive costs way up, and put all of us consumers in greater debt.

What can you do about it?

A public meeting will be held on Weds, May 6, 2009 at Mendocino College, room 5380 (in the CPVA building located at 1000 Hensley Creek Road, Ukiah.)

This is the time to state your opinion regarding these water rate changes. The more the better.

If you cannot make it, you can send a letter to the district directly stating your opinion.

If you’re concerned, please post a comment.