The Santa Fe Irrigation District is closer to adoption of its first rate increase since 2013, now that a divided board of directors has voted to set a public hearing on a rate plan that would generate a maximum of 9 percent in increased revenue for each of the next three years.
At its meeting on Thursday, March 17, the board voted 3-2, with directors Greg Gruzdowich and Marlene King opposed, to set a public hearing on the rate plan for May 19. Before that date, the district will send out an eight-page notice detailing the rate plan to customers and property owners in the district, and hold three community forums to explain the rate plan and answer questions.
The board also voted 3-2, again with Gruzdowich and King in opposition, not to include a clip-out coupon indicating a protest of the rate plan, with the public notice being mailed out on April 1.
The votes mirror earlier decisions by the board on the rate plan. A final vote will take place after the public hearing in May. If approved, the new rates would take effect June 1. While the overall impact of the plan will be to raise district revenue, the effect on individual customers’ bills will vary, based on such factors as amount of water used and customer classification.
The proposed rate plan restructures the way the district calculates its bills, increasing the proportion of revenue collected from fixed meter charges, which don’t fluctuate with the amount of water a customer uses.
Therefore, the impact on customers’ bills varies substantially, from those who are receiving a large percentage increase, to a significant band of customers who will actually see their bills go down, according to figures released by the district.
Customers who use 150 units of water over two months, which is slightly below the district average, would see their bi-monthly bills rise 10.1 percent, from $617.37 to $680.03, under the proposed rate plan.
The variance in the impact on customers is one of the reasons cited by Gruzdowich and King for their opposition to the plan. Gruzdowich said that under the plan, those who use a lot of water will see their bills jump by 20 to 25 percent.
Conversely, those who use the least amount of water will also face a large percentage increase in their bills, because of the higher fixed charges.
The plan, for those lower-use customers, is “incredibly regressive,” said King, while she, as a resident of Fairbanks Ranch, will pay less. “I don’t think I should be getting a reduced rate.”
Board members who support the plan, as well as district general manager Michael Bardin, said it was designed after completion of a comprehensive cost of service study, which analyzed the district’s revenue needs and sought to apportion costs fairly among customers.
“I think the process has been fair,” said board president Michael Hogan.
“There’s a significant impact to all customers... not just the big users,” Bardin said.
Bardin also emphasized the district’s need for new revenue.
“It’s absolutely critical to raise rates now,” he said. “We have all these needs. It’s time to do it.”
Under state law, the district is required to go through a series of steps to raise its rates. They began with the cost of service study, and include the public notice that will soon be mailed out. The mailing begins a 45-day comment period, culminating with the public hearing.
According to district spokeswoman Jessica Parks, there are approximately 15,000 properties within the district, which serves Rancho Santa Fe, Solana Beach and Fairbanks Ranch. If the owners of a majority of those properties, representative of about 7,500 parcels, submit written protests of the rate plan, the board would be blocked from enacting the new rates, Parks said.
The written protests must include the property address and a hand-written signature, Parks said. Only one protest per parcel will be counted.
King sought to include the protest coupon in the public notice, similar to one sent out by the city of San Diego when it was deliberating on water rate increases.
“That says we’re comfortable with what we’ve done and we’re giving you a clear, easy way to say you disagree,” King said.
But Bardin said the addition could delay an approval process that has already been pushed back by several months. Also, he said, the coupon would contradict a position held by staff and a board majority, that the proposed rate increase is fair and much-needed.
“I think it runs contrary to what we’re trying to do,” Bardin said.
Board member Augie Daddi, one of the three members who have voted to support the rate plan, also opposed including the protest coupon with the public notice.
Addressing King, he said, “It appears you are trying to find another way to get this turned down. That’s how it appears to me.”
The community forums on the rate plan will be held at the district office, 5920 Linea Del Cielo, Rancho Santa Fe, at 5:30 p.m. on Thursday, April 14; 10 a.m. on Wednesday, April 20; and 5:30 p.m. on Tuesday, April 26. The full cost of service study can be viewed on the district web site, www.sfidwater.org.