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Local News

Goleta Water District Mulls 73% Rate Hike for New Commercial Water

Board may take up new-usage proposal Tuesday in bid to resolve budget challenges

Developers seeking to increase commercial water usage for their projects in the Goleta Valley could see a rate hike of 73 percent under a proposal the Goleta Water District is considering.

District officials said they are mulling rate increases for any application that requires an increase in commercial water use. Any amount greater than what’s been used on the property previously would be subject to the higher rate. The move comes at a time when district officials say they’re just trying to keep up with the costs of state water.

State water costs the district $8 million annually, about a third of the local agency’s budget, according to GWD general manager John McInnes. The changes, if approved, won’t affect existing commercial rates.

“We haven’t looked at these costs in a long time,” he told Noozhawk.

Because the district’s rates are seldom evaluated, even as the State Water Project raises its rates annually, a greater deficit occurs. State water is growing more and more expensive for users, and “everyone around the state who takes state water is saying the same thing,” he said.

The current cost for commercial users is $26,240 per acre foot, but the district would raise the price to $45,361 per acre foot, allowing the district to cover its costs, McInnes said.

The rates have been updated a couple of times since state water rates were enacted in 1996, but it’s been several years since they were raised.

“Developers are concerned and I certainly understand that,” said McGinnes, but he added that the increases are all “pass-throughs” from the state, and reflect nothing but the actual cost of state water.

If the rates aren’t increased “customers will be subsidizing new development,” he said.

The Goleta Water District board may consider the rate change at its Tuesday meeting. McInnes said the board is under no statutory requirement to hear the issue and could postpone it if it wanted to.

That’s exactly what leaders at the Goleta Valley Chamber of Commerce are asking, and an e-mail circulated Friday encouraging chamber members to ask the board to wait to make a decision.

“While we understand that the district is facing an overall budget problem, this solution appears to place an extraordinary burden on new businesses to solve a long-existing problem,” wrote chamber president and CEO Kristen Amyx.

“Consider that every new home that is proposed, every high-tech business that needs to expand, every restaurant to open or recreational facility will face an unpredicted 73 percent rise in their cost to start up,” she said.  “Most won’t be able to afford it and these expansions will not take place. That hurts all of us.”

The district is in the process of evaluating all of its rates, and will hold a public hearing March 31 at the GWD office, 4699 Hollister Ave.

Tuesday’s meeting on the commercial rate increases begins at 5:30 p.m. and the ordinance will go before board members.

Noozhawk staff writer Lara Cooper can be reached at .(JavaScript must be enabled to view this email address). Follow Noozhawk on Twitter: @noozhawk or @NoozhawkNews. Become a fan of Noozhawk on Facebook.

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