The economy and the upcoming increase in rates for water and sewer in Garberville were topics of concern at the monthly meeting of the directors of the Garberville Sanitary District.
As the board reviewed its financial report for the previous month, it was noted that the district’s income was down slightly, less than 10% of the previous year.
Director Bill Stewart noted that the figure didn’t seem excessive to him. He said that retail sales are generally down between 20 and 28 percent and it was not surprising that the district’s income was down as well. He said also that without the rate increase the district’s income would be down even more.
District Administrator Mark Bryant said that the shortfall for the month was only $290 when depreciation was taken into account.
Stewart then asked Bryant about write-offs of bad accounts. He said that write-offs at Blue Star Gas were up 30 to 40 percent.
Bryant said that the district didn’t generally write off bad debts. He said that it was the practice of the district to sit down with customers who got behind in their bills and work out a payment plan.
”It’s all very amiable,” he said.
This prompted director Dwight Knapp to say that he thought that might all be about to change. Knapp said he had looked at his most recent water bill in the amount of $87 and calculated that it was going to rise to $150 when the new rates go into effect in October.
”I don’t think people in Garberville are aware of this,” he said. He went on to say that he didn’t think it was fair as he couldn’t think of any other district that had raised rates as much as Garberville and that Garberville water was going to be the most expensive water around.
”Can you think of an alternative?” Chairman Herb Schwartz asked.
Knapp acknowledged that he didn’t have an alternative and felt discouraged at the unfairness of the rising costs and the impact it would have on household budgets.
Stewart said that he wanted Knapp to know that his concerns had been heard, but the district had been given mandates and had to act.
”It’s the cost of providing the services,” Schwartz said.
”It could be worse,” Stewart added. “At least most of it (the improvements) is being paid by grants.”
Schwartz said that portions of the cost are being paid by loans.
Bryant then gave an historical review of how the district arrived at its current situation, starting with the cease and desist order that led to a ban on any new sewer hookups because the existing sewage treatment plant was at its maximum capacity.
Schwartz noted that the district had been able to negotiate that moratorium without incurring any fines.
Bryant then went on to say that the district is the first entity in, not just the county, but the entire state, to have its new sewage treatment plant funded through ARRA or the stimulus package. However, that money comes with a requirement that the district raise its rates to be eligible for the estimated $3 million dollars.
”If we don’t pass the rate hike,” Bryant said, “we will lose the $3 million.”
As reported in the July 28 Times-Standard, the city of Rio Dell is facing a similar predicament, having to raise its sewer rates to qualify for a $2.25 million grant.
Knapp said he understood that, but he was shocked when he realized how much his water bill would be. He said he was also concerned about the process in which the rate hike is approved unless 51% of the district’s customers send letters of protest. But if that happened, the district would lose the $3 million and remain under the building moratorium until such time as the rate payers came up with the money themselves to upgrade the system.
Stewart said that even though the rate hike looked like a lot of money now, the inflation he sees coming in the future will make it look like a bargain. He said also that a rate increase in Redway years back took a long time for residents to accept, but they finally did. He said also that he thought the new system would be a great advantage to Garberville residents.
Schwartz agreed, saying it was a capital improvement that will benefit the rate payers.
”Homes aren’t of much use if you can’t get water out of the tap or flush your toilet,” he said.
Later in the meeting, after the discussion, the directors had the first reading of the proposed rate hike ordinance. The second reading will take place at the district’s August 29 meeting, at which time the ordinance will be adopted.
Also at this meeting, Bryant presented the directors with a proposal to enter into an agreement with the Connick Creek Water Association to read meters that the association would install. The history of this situation, Bryant explained, is that in 2004, when the water company was still privately owned, Greg Terry did a subdivision in the Connick Creek Watershed but since there was not enough water to support the subdivision, Connick was required to get a water connection from the Garberville Water Company. A large meter was installed with connections going to the various parcels in the subdivision, which is located near the sewage treatment plant. The property owners were proposing to pay for individual water meters and have them installed, but wanted the district to do the reading of the meters.
Schwartz said that, as a lawyer, he had several concerns about the proposal. These were the legal status of the Connick Creek Water Association, that fact that GSD board member Peter Connolly is a member of the Association and thus would have to recuse himself from any participation in the discussion or voting on the proposal, and the lack of clarity as to who owns what in relation to the water lines and meters. There was some confusion as to how many meters were being installed, the number ranging from five to nine.
Stewart agreed these were good points that needed to be resolved. As the discussion went on, it was revealed that the developer had not followed through on some of his obligations, which were to form a road association and a water association. Connolly said the association has no legal standing and that there is no agreement among the homeowners in the subdivision. He also indicated that he had no wish to belong to the association, but that they were looking for a neutral party to read their meters. Board member Dennis Bourassa suggested they hire someone.
Bryant said that since Garberville attorney Doug Ingold had written the current agreement between the land owners and the Garberville Water Company it could be assumed that everything was okay. Schwartz said he found the agreement confusing, although it might be very clear to Ingold, he wanted to see an agreement that would be clear to any attorney. Schwartz said there are very specific laws regarding associations.
Bryant continued to suggest it was a good idea for the GSD to agree to be the subdivision’s meter reader. He estimated that it would bring the district about $490 a month in income. He said further that the subdivision would be within the district’s sphere of influence when the new General Plan takes effect.
However, the directors were not ready to approve the proposal and requested that more information be obtained.
In other business, Bryant reported that the Kimtu acquisition was on hold as there is no funding for it due to the state of the bond market. A bill in the Assembly, AB 1482, may help overcome the bond freeze, Bryant said.
In response to a question, Bryant said that bulk water purchasers pay about 30% more per gallon for the water they buy than regular district customers. However, Bunny Valk, who does the billing, disagreed, saying she thought the bulk water was cheaper.