Kathleen C. Hedberg - Helix Water District Division 4
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3PM Wednesday, July 29 -  Helix WD Committee of the Board Package - Discuss Proposed Water Rates

7/26/2015

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Dear Friends,

 Here is the  board package link for our Committee of the Board Helix Water District Board Meeting:

  AGENDA
COMMITTEE OF THE BOARD
REGULAR MEETING OF THE BOARD OF DIRECTORS
Wednesday, July 29, 2015 - 3 p.m.
7811 University Avenue, La Mesa, CA 91942-0427
 
BRAND NEW WATER RATE STRUCTURE & WATER RATES BEING PROPOSED – 5 YEAR PLAN (Page 52 pdf Prop 218 Notice).

 A very thorough review of our rates, with a strong correlation of water use and cost. Of course, I do have some comments, suggestions and questions after reading the Board Report and the 60 page Comprehensive Water Cost of Service & Rate Study.

 Please note: The main changes in our rates is due to the amount of water anticipated in being sold. We are estimating to sell only 27,700 Acre Feet compared to the 2014/15 budget of selling 34,500 Acre Feet – Governor Browns REQUIRED 20% Reduction. As you know, selling less in commodity – with the same budget results in a higher unit price to the customer. That is why last May the Board went over critical water rate guidelines and had recommended some important suggestions – some that were amiss in this report.

 Item of Discussion:

 The Board Consider the Recommendations Contained in the Helix Water District  Comprehensive Water Cost of Service and Rate Study Report Prepared by

Raftelis Financial Consultants Inc., Review Proposed Water Service Fees for Water Rates, and Provide Comments on the Corresponding Draft Proposition 218

Customer Notice of Public Hearing on October 7, 2015

 PROPOSED FOR WEDNESDAY DISCUSSION - final vote slated for the August 5th meeting, with incorporating the Public and Board comments… I think there are definitely some modifications that need to be considered.

  • Quite a few miscellaneous changes proposed:

    • Residential Tier 1: 0-14 Units

    • Residential Tier 2: 15-34 Units

    • Residential Tier 3: 35+ Units

    • SDCWA Pass through costs – I think this is a good idea, shows transparency on your bill what increase is Helix and what increase is SDCWA

    • Irrigation customers Tier 3 is eliminated.

    • New rates will be on bills after January 1, 2016 (water used after November 1) to correlate with SDCWA increase (finally -I have asked this for 9 years!)

    • Meter charges change significantly for fire service line.

    • Capacity Ratio changed for Meters equal or greater than 3” (page 27 of report - they used a different class, turbine class versus compound, we install compound meters, those numbers have to change and may affect other meter sizes, also there appears to be 650 meters missing since last year, which would change some of the cost impacts.)

  1. Water Rate Assumptions used:

    1. Water sales 27,700 acre-feet (20% reduction)

    2. SDCWA water rate increase 13.7% for 2015-16

    3. Fixed/variable cost split of 24 percent/76 percent (meter charges)

    4. Utilize 0 Million from rate stabilization fund this year 2015/2016;

    5. Utilize $1.0 Million El Capitan settlement to designate to an asset for use this year 2015/2016

    6. Defer $3.0 Million in the districts capital improvement program

 2014/15 Budget Estimate Actual Revenue $76,444,057; Budget Total Expenses $79,380,679

2015/16                             Budget Revenue $74,540,919; Budget Total Expenses $83,060,869

Conclusion:  Proposed residential rates would result in an increase bi-monthly bill for the average residential customer 26 Units From:

                                    2015/16 an 9.0%        ($142.70 to $155.53)
                                    2016/17 an 11.6%      ($155.53 to $173.55)
                                    2017/18 an 11.8%      ($173.55 to $194.09)
                                    2018/19 an 7.3%        ($194.09 to $208.19)
                                    2019/20 an 7.6%        ($208.19 to $223.93)

Please note:
  1. On May 13, 2015 the Board had a Five Year Projection Workshop, to help provide staff guidance for developing proposed water rates (Minutes: http://hwd.com/board/minutes051315.pdf ). At this meeting we directed staff to go with Scenario 2 which included:

    1. SDCWA water rate increase impact Helix at 6.6% for 2015-16 (confirmed in June http://www.sdcwa.org/water-authority-adopts-15-billion-budget-fiscal-years-2016-and-2017 )

    2. Water sales 27,700 acre-feet (20% reduction)

    3. Fixed/variable cost split of 26%/74% (meter charges – currently we are at 23.5%/76.5%)

    4. Utilize $1.5 Million from rate stabilization fund this year 2015/2016

    5. Utilize $1.0 Million El Capitan settlement to designate to an asset for use this year 2015/2016

    6. Defer $3.0 Million in the districts capital improvement program

2014/15 Budget Estimate Actual Revenue $76,444,057; Budget Total Expenses $79,380,679

2015/16                             Budget Revenue $74,702,700; Budget Total Expenses $82,617,057

Conclusion:  Proposed residential rates would result in an increase bi-monthly bill for the average residential customer 26 Units From:

                                 2015/16 an 8.0%
                                 2016/17 an 7.9%
                                 2017/18 an 7.3%
                                 2018/19 an 7.0%
                                2019/20 an 6.5%

I know that the May meeting was “DRAFT Numbers” but, they should have used all the guidance that we provided them, items c, d. Also, not sure why the SDCWA rate was increased? I also, do not know how our end of the year June 30, 2015 budget revenue/expense numbers came out. Our Director of Administration Lisa Stoia said that she would have the information available for this important meeting. They could not provide a Treasurer Report on July 15th, due to the first two Tuesday accounting conflict. Many questions to ask and discuss on Wednesday – Hope you can make it!

As always, I welcome your comments and feedback.

Per the request of the Helix Water District Board on May 16, 2012, the following language is to be added by all Board Directors in all outgoing Director correspondence. "This correspondence, and any documents attached hereto, reflects the individual opinions and positions of the above-named Director and does not represent the opinions or positions of the District's Board of Directors or the District.  Pursuant to Section 9.1-11(A) of the Helix Water District Policies and Procedures Manual, individual Directors, except as otherwise authorized by the Board, shall have no power to act for the District or the District's Board of Directors."

**Please note no public funds or resources were used for the distribution of this email...

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RESULTS OF TODAYS HELIX WD BOARD MEETING - Wednesday, July 15

7/15/2015

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Dear Friends,

 I am pleased to announce that Item 15 was voted down today by the Helix Water District Board 5-0.

Despite Staff/Legal recommendation for a proposed new Emergency Drought Action Plan Resolution.

 Resolution 15-49 included new language such that “…all domestic class customers are prohibited from using more than 30 units of potable water per billing cycle for indoor and outdoor water purposes for their property. …excess of 30 units of water per billing cycle shall be in violation of the restrictions…and subject to a civil volumetric penalty for each unit of water…”

 This new language wording did not sit well with the majority of the Board Members, to say the least.

 A motion was made by Director Scalzitti to not adopt the proposed Resolution and bring back the initial Resolution 15-38 to discuss the Penalty 10% increase to Tier 3 customers (with hopes to remove the section based on District Conservation Efforts). I seconded the motion and the motion passed unanimously. Director Verbeke wanted to table the item to have staff/legal reword it, but Director Scalzitti insisted and called for a vote. The vote was unanimous.

 I am also pleased to announce that today the San Diego County Water Authority (SDCWA) won Phase 2 of the litigation against the Metropolitan Water District: $188 million in damages, plus interest, and our preferential rights claim.  Attached is the 30-page decision. I am sure we will hear more about this later…of course, my comment is “show me the money”! Hopefully, it doesn’t get caught up in more legal appeals, where the lawyers just continue to “win” especially, when we at SDCWA are paying for part of MWD’s lawyers too (25%)! I will keep you informed.

 

As always, I welcome your comments and feedback. 

Per the request of the Helix Water District Board on May 16, 2012, the following language is to be added by all Board Directors in all outgoing Director correspondence. "This correspondence, and any documents attached hereto, reflects the individual opinions and positions of the above-named Director and does not represent the opinions or positions of the District's Board of Directors or the District.  Pursuant to Section 9.1-11(A) of the Helix Water District Policies and Procedures Manual, individual Directors, except as otherwise authorized by the Board, shall have no power to act for the District or the District's Board of Directors."

 

**Please note no public funds or resources were used for the distribution of this email...

 

 

 

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2PM Wednesday, July 15 -  HELIX WD REGULAR BOARD MEETING

7/13/2015

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Attached is the agenda and board package link for our Regular Helix Water District Board Meeting:

 AGENDA
REGULAR MEETING OF THE BOARD OF DIRECTORS
Wednesday, July 15, 2015 - 2 p.m.
7811 University Avenue, La Mesa, CA 91942-0427

CONSERVATION STATUS (PDF Page 77):: We are doing GREAT! Please keep conserving – but please don’t let the trees die, I was told that you can take a soaker hose and wrap it around your tree and let it drip for several hours twice a week and that would be acceptable.  I will ask about the penalty on Tier 3 and the need to continue and will ensure that it is not incorporated in our new water rate structure.
 Click Here for Drought Level 2 Restrictions
JUNE ‘13    3321.5    
JUNE ‘ 15   2490.2           102.8gpcd 
CUMULATIVE REDUCTION SO FAR –-25%  
PERCENT REDUCTION NEEDED ’13-‘15 By February 2016    -20%
 Items of Interest:
 No end of year financial report (June 30, 2015) included - unfortunately, there is no Treasurer’s Report in this package as our Director of Administration, Lisa Stoia reported “For July 2015 the first two Tuesdays are July 7 and 14 so we didn’t have time to submit the financials for the board package for the second board meeting of the month which is July 15.  They will be included in the board package for August 5.” 

 However, she did say that it will be available for the July 29th Special Cost of Service Study and Water Rates Meeting (proposed new rate structure & rates).

 Speaking of which, at our last Regular Board Meeting on July 1,  I had sent out an email to the Board stating that I had a conflict for the new scheduled August 5th Meeting (the staff changed the date without discussing with all Board Members – only asked the 3, Muse, Verbeke and Linden) to discuss the new water rate structure and gave two other alternative dates to consider. Unfortunately, Director Muse, Verbeke and Linden did not want to consider any other dates and President Verbeke hammered down the gavel ending the discussion and meeting in a haste (so not Robert Rules of Order)!

However, later after the meeting was concluded I had suggested to our General Manager to have a Special Meeting where staff could present the information to the public and Director Scalzitti and I could attend, July 29th. Problem solved! Apparently, the other Board Members when hearing about the Special Meeting had a quick change in heart and said that the July 29th date will work for them after all!

Thus, Wednesday, July 29th at 3pm, there will be a special meeting to discuss and review the Final Cost of Service Study Report and Draft Water Rates.  Then on August 5th, with or if all potential changes considered from the July 29th meeting, the rates will be adopted to go out for notice to the public (PROP 218). So, it is imperative that if you are interested in the new rate structure and rates, please consider attending the July 29th at 3pm meeting. I should have a draft sent to me ahead of time on July 24th to send out accordingly.

Item 15 (PDF Page 71) Adopt Emergency Drought Action Plan Resolution 15-49 (Again?)

Looks like legal wants us to update our Resolution and add more verbiage on the “Civil Volumetric Penalty”, aka a 10% increase to those residential customers who are in the tier 3 water level (greater than 30 units). Basically, the new resolution states that all domestic class customers are prohibited from using more than 30 units of potable water per billing cycle.

As the initial Resolution 15-38 was discussed in May, Helix was one of the first agencies to impose this type of penalty - three penalty rates were proposed and I fought for the lowest, with the intent to review our usage and get rid of the penalty as soon as possible. Other local agencies who also need to cut 20% Otay Water District and Padre Dam MWD have not imposed any penalty rate increases. I think this Resolution/Penalty will be worth discussing again.

As always, I welcome your comments and feedback.

 Per the request of the Helix Water District Board on May 16, 2012, the following language is to be added by all Board Directors in all outgoing Director correspondence. "This correspondence, and any documents attached hereto, reflects the individual opinions and positions of the above-named Director and does not represent the opinions or positions of the District's Board of Directors or the District.  Pursuant to Section 9.1-11(A) of the Helix Water District Policies and Procedures Manual, individual Directors, except as otherwise authorized by the Board, shall have no power to act for the District or the District's Board of Directors."

 **Please note no public funds or resources were used for the distribution of this blog...

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    Author: Kathleen Hedberg

    Civil Engineer in 4th Term as a Helix Water District Board Director and Past President of the Board!

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The Helix Water District covers an area of nearly 50 square miles, serving the cities of La Mesa, El Cajon, Lemon Grove, the community of Spring Valley, and various unincorporated areas near El Cajon. Helix Water District owns Lake Jennings and Lake Cuyamaca. Helix Water District customers receive water treated at a 106 MGD R. M. Levy Treatment Plant in Lakeside. Helix also has storage rights of 10,000 acre feet in El Capitan Reservoir for water from Lake Cuyamaca, San Diego River tributaries, and imported water. Treated water is stored in the 30-million-gallon Grossmont Reservoir, under the grass at Harry Griffen Park, and 21 other storage tanks located throughout the District. The District has a total storage capacity of 63 million gallons for filtered water.

Paid for by Supporters of Hedberg for Helix Water District Division 4 - 2014, ID# 1370766