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.

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