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March 2, 2021

Tensions boil over in SLV water merger meeting

In a tense, two-and-a-half-hour board meeting on Feb. 4 that included more than 100 attendees, San Lorenzo Valley Water District (SLVWD) broached the subject of a potential merger with Scotts Valley Water District (SVWD).

The reaction from those who attended the Zoom meeting was anything but subtle: the majority opposed the idea, and representatives of SLVWD found themselves back on their heels from the opening salvo.

SLVWD is no stranger to drama around mergers. FLOW (Friends of Locally Owned Water), a Felton-based advocacy group, was born in 2002 after the Felton Water system was purchased by New Jersey utility company American Water Works, which was under the control of overseas conglomerate RWE from 2001-08. Cal-Am Water, an American Water subsidiary based in California, attempted to increase Felton water rates by 74%. After six years of working with local leaders, including then-Felton Representative Mark Stone, FLOW saw Cal-Am Water and SLVWD come to an agreement in 2008 for the town’s water to, once again, be controlled locally.

Then came the merger with the Lompico County Water District (LCWD) in June 2016. The result was an increase of 500 water hookups for SLVWD, and a $2.75 million dollar bond that would be paid via property taxes over a 30-year term. LCWD had no general manager, and the district was run by then-Board President Lois Henry (who recently finished her term as SLVWD Board President).

The troubled utility discovered a raft of issues with its bookkeeper (arrested for embezzlement in 2010) and its director, who was fired in early 2010 for “mismanagement.” The only option to keep Lompico residents “in water” at a reasonable price was the SLVWD merger; although some residents were opposed to the idea, the general perception was that it was a necessary step for the community.

On Feb. 2, SLVWD threw its ratepayers for yet another loop when the utility issued a press release regarding their intent to begin a conversation around a potential merger with SVWD. A day later, an online petition was circling, and by early Wednesday morning, nearly 1,500 residents had added their names in opposition to the proposal.

While the districts share boundaries, aquifers and priorities, each has carved out its own means of serving its residents. While the SLVWD was established in 1941 as an independent special district, SVWD wasn’t formed until 20 years later under the County Water District Act. Both districts are governed by a five-member board of directors, elected at-large from within the district’s service area, but each has vastly different geographical makeups. 

SLVWD covers 60 square miles of challenging, mountainous terrain providing service to approximately 7,900 connections. SVWD is only six square miles and services its population through 4,200 service connections.

SLVWD’s website says the district “relies on both surface water and groundwater resources, including nine currently active stream diversions, one groundwater spring, and eight active groundwater wells. The District owns, operates, and maintains two water systems from separate water sources. These sources are derived solely from rainfall within the San Lorenzo River watershed.”

The Mañana Woods neighborhood, and the Vista Del Lago and Spring Lakes Mobile Home Parks, all located in Scotts Valley, are served by SLVWD.

Both districts share water from the Santa Margarita Groundwater Agency (SMGA). Established in 2017, the agency covers a 30 square mile geographical area including parts of Boulder Creek, Brookdale, Lompico, Zayante, Ben Lomond, Mount Hermon and Scotts Valley. Although SMGA is the most easily accessible aquifer in the region, there are three other layered aquifers beneath it, each providing water support to area customers, including those on well water. The deepest water deposit, the Butano aquifer, is only accessed by SVWD.

The longtime rivalry between the two valleys was on full display in the Feb. 4 meeting, as residents from both regions did not mince words when it came to vilifying their neighbors. San Lorenzo Valley attendees spoke of the cultural differences, citing a chasm between the values of the two areas, and shared concerns about stolen water, a lack of local control and a fierce resistance to supporting what many see as Scotts Valley’s attempt to acquire water for their expanding population.

A SVWD employee called in to say he was opposed to the merger, and one attendee called it “the worst idea since the pet rock.” 

Two days later, SLVWD board member Tina To released a statement in an effort to tamp down the rhetoric, but the damage had been done. The statement has since been taken down on advice by the district’s legal counsel.

Leaders from both districts have yet to say what is the impetus for merging at this point? SLVWD Director Rick Rogers boiled it down to a cost-savings event, citing the destruction to the watershed and infrastructure following the CZU August Lightning Complex fires that resulted in a melted water main, the destruction of holding tanks and the loss of over 1,000,000 gallons of water.

It is unclear if the merger will mean Scotts Valley residents will be dragooned to help the San Lorenzo Valley utility regain its financial footing. Future rate hikes are a strong possibility to replace the infrastructure lost to the CZU fires, and those ratepayers could be left in financial hurt if the merger is shot down.

The SVWD board meets tonight (Feb. 11) at 6pm. Join the meeting online: global.gotomeeting.com/join/488730213 or call (646) 749-3122 and enter access Code 488-730-213.