District justifies water rate increase

San Lorenzo Valley Water District administrators explained this week that a rate increase is necessary to repair an aging water system in need of expensive repairs and to ensure the financial stability of the public agency into the future. The district also said that combining its three facilities into one campus will increase efficiency and allow for an ADA and seismically up-to-code administrative building.
The proposed increase — 16 percent in 2014, 13 percent the following year and 8 percent, 9 percent and 9 percent each year through 2018 — has been approved by the district’s board of directors and awaits final approval at a Proposition 218 rate increase hearing. The hearing is scheduled for 7 p.m. Oct. 24 at Highlands Park Senior Center, 8500 Highway 9 in Ben Lomond. Property owners have the ability to protest the increase in writing, and Proposition 218 calls for half the district property to protest in order to turn down a hike.
The district says maintaining and upgrading the water system is a key component of the increase.
“We’re performing reactive maintenance,” said Operations Manager Rick Rodgers. “Our staff is spending more and more time on mainline repairs.”
Rodgers said in many cases, his staff is adding patches to substandard water mains that are 50 or 60 years old.
“There are some streets where we are on a first-name basis with some of the customers because we are out there almost every month,” he said.
Rodgers did say the backbone of the system is in “fairly good shape,” but that many of the pipes that go into neighborhoods are 1 1/2 –inch or 2-inch mains that should be replaced with 6-inch mains to allow adequate water flow and for fire protection.
Rodgers said that these types of repairs are expensive, with main pipe running $150 to $200 per square foot, not to mention the cost of environmental studies and the cost of digging up and replacing pavement.
If the increase goes through, the district’s revenue would increase from $5.6 million per year in 2013 to $8.59 million per year in 2018, the last year of the increase. As part of the increase, the district has budgeted $1.29 million per year, starting in 2014, towards $27.4 million in capital improvement projects it identified in 2010. A complete list of the projects is available on www.slvwd.com.
The average customer’s bill would increase from $90.99 bi-monthly to $153.02 in 2018, according to the district.
One of those projects on the capital improvement plan is the district administrative campus, which the district calls its facilities consolidation. The district will consolidate two storage facilities and its administration building to one location in downtown Boulder Creek. The land has been purchased for $2.2 million and the district plans to build the new facility for about $6 million more.
District analyst Besty Herbert said the current administation building on Highway 9 in downtown Boulder Creek was purchased in 1964, and is not Americans with Disabilities Act compliant. It also has limited parking, is not up to seismic code for a new building and is simply old.
A tour of the building found the floor to be slightly sloped down the hill, single stall bathrooms for male and females district employees and a warehouse with deteriorating wooden flooring and shelves.
“We had extensive mold and rot and we did a remodel,” Herbert said. “It included new carpets and paint, just to make it habitable.”
Herbert said the district has looked at other options revitalizing the building, but found that because there is not enough on-site parking, the building’s footprint would have to shrink to add parking spaces, creating an added burden in already tight quarters.
Secondly, the new campus would act as a 24-hour emergency facility for the district — including its own fueling station and a place to house its computer system that monitors water flow during emergencies. Rodgers said the district is in talks with local fire districts to share the fueling station with them.
The campus would also include a public meeting room for the board that could be used by the community.
Opposition to the campus project has popped up.
A Zayante-based group called SLV Watchdogs said a rate increase is merited, but not if the purpose is to build a new administrative campus. For information, visit www.slvwd.co or search San Lorenzo Valley Watchdogs on Facebook.
The increase is based on a rate study performed by Municipal Financial Services of Henderson, Nev. which took into consideration ways to fund the districts board-approved 2010 Capital Improvement Plan.