Water board says increase necessary to avoid bankruptcy

Lompico County Water District board member Lois Henry says the district’s proposed rate increase is necessary to avoid bankruptcy.
“I don’t want to see a rate increase, but without a rate increase, I think we will go bankrupt,” Henry told about 35 members of the public during a May 7 meeting about the increase.
Henry, a former credit union CEO, has been poring over the district’s financial records since she was elected last November and is working with the board to steady the district’s budget.
The rate increase is a flat $15 every two months paid by each of the 500 water connections in the district. It will increase district revenues by an estimated $45,000 every year.
Before a reimbursement check for more than $53,000 arrived from the Federal Emergency Management Agency for repairs to Lake Boulevard, the district’s reserves had all but dried up. The district spent more than $58,000 on the Lake Boulevard repairs.
Because of a decrease in water sales, higher employee costs, the Lake Boulevard repairs and property tax money taken by the state, the district lost more than $171,000 in the past two years. The loss emptied the reserve and capital improvement bank accounts and left less than $1,000 in the general fund.
“Every board member for the last 15 years or so has kind of played a part in this thing,” board member Jane Wyckoff said at the meeting. “I think there’s a lot of commitment on this board to straighten out the problems we have.”
The board is taking a close look at each line item in the district’s budget.
In addition to the rate hike, the board is looking at cost-cutting measures, including examining how the district general manager is paid for overtime.
A more long-term issue is the financial hole the district seems to be in. Over the past decade, district general manager Mike Eggleston has accrued more than 100 days of paid vacation time, a significant liability for the cash-strapped district.
The district will have a public hearing at 7 p.m. June 8 at the Zayante Fire Station to decide on the increase. If more than half the parcels in the district file a complaint letter by that day, the board must nix the proposed rate hike.
The price of water
Average two-month water bill for a residential customer using 18 units of water (225 gallons per day.)
Lompico: With proposed $15 increase, $107.66
Scotts Valley: $106.49
San Lorenzo Valley: $84.72
City of Santa Cruz inside
city limits: $92.88
City of Santa Cruz outside city limits: $106.16
Soquel Creek: $104.38
Pajaro Valley: $98.01
Mount Hermon: $71.70