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Montecito Water District Plans Surcharge, Increase to Rationing Amounts to Balance Budget

Drought-related expenses and the drop in water sales mean the district is operating at a loss for this year

The Montecito Water District expects to spend $3 million in water shortage emergency expenses for the 2014-15 year, including about $1.5 million in supplemental water.
The Montecito Water District expects to spend $3 million in water shortage emergency expenses for the 2014-15 year, including about $1.5 million in supplemental water. (Giana Magnoli / Noozhawk photo)

The Montecito Water District plans to increase water allocations for Montecito and Summerland residents under its rationing plan and simultaneously implement a surcharge for all customers.

Customers were asked to cut back water use last year, when the district could have run out of water by summer otherwise, and customers have cut back substantially.

Water sales from last July through January were about half compared to 2013-14 — very good for conservation, but bad for the district’s bottom line, especially at a time when it’s spending millions of dollars on supplemental water and desalination plant studies.

Montecito Water expects to spend $3 million in water shortage emergency expenses for the 2014-15 year, including about $1.5 million in supplemental water and the rest for legal expenses, conservation outreach, studies on new supply sources including desalination, and partially funding the Cachuma Operation and Maintenance Board’s emergency pumping project.

To stay solvent, the district’s Board of Directors is advocating a surcharge added to water bills, starting at $1.87 per HCF (748 gallons). The amount could drop or increase — to a maximum of $4.16 — depending on water sales. It’s a temporary measure that will end once water supplies have “normalized” and drought-related expenses are recovered, according to the district.

This fee will go into effect April 1 unless a majority of district customers in Montecito and Summerland submit written protests. Unlike so-called drought water rates, the surcharge doesn’t follow the tiered rate structure and charge larger users more money per unit than the lowest users, it’s the same increase for everyone.

The $1.87 is meant to compensate for a 20-percent drop in water sales, general manager Tom Mosby said.

Montecito resident David Strauss sees the plan as subsidizing larger users at the cost of smaller users, to keep major water users from leaving the system to dig private wells.

“I understand if high users need more water, but some of them don’t need as much water as they have. If you need more water in a drought situation, you should be prepared to pay the premium for it,” Strauss said.

At Tuesday’s meeting, he said he has been cutting back on landscape irrigation with a drip system and other improvements, and doesn’t plan to use more water even if ration allocations increase. 

The district already approved planned increases of 16.3 percent in mid-2013 and 7.4 percent every year through 2017-18, as part of its five-year financial plan adopted in 2013.

It’s important for the district to stay solvent and keep good credit for capital projects and the possible desalination plant, board president Darlene Bierig said.

The community asked the district to get water — saying the ambiance of the community depends on it — and the district did, she said. Long-term financial projections used the “rosiest plan possible” and now the situation is the “opposite of rosy” with the spending on supplemental water and other drought-related purchases, she said.

Supplemental water purchases didn’t come cheap, and the district will be writing a $1.26 million check for a water purchase this week through the Central Coast Water Authority, Mosby said.

At the same time the board is trying to pay for these multimillion-dollar water purchases from other areas, board members decided to increase the rationing amounts.

Rationing went into effect with Ordinance 93, which was approved in February 2014, and allocated 25 HCF (or 18,700 gallons) for “essential uses” per customer account and another 111 HCF (per acre, per customer, per year) for non-essential uses, such as landscape irrigation. The board wants to increase the 111 HCF to 196 HCF.

The district expects people to buy more water, but depends on some people staying under the rationed allocations to provide carryover water for the next year.

If the rationing allocations increase, there will probably be fewer penalties paid, Mosby noted. The proposed $1.87 surcharge depends on the district getting $2 million in penalty fees this year.

People who are very successful at conserving could actually force the district into implementing a higher surcharge rate due to the lack of sales, director Sam Frye pointed out. Those people could get penalized while trying to use less water and help the district, he said.

The district has also had to deal with customers trucking in water and drilling personal groundwater wells, which takes money away from water sales.

There will be a town hall meeting on the proposed surcharge at 6:30 p.m. March 12 at Montecito Union School, 385 San Ysidro Road. The Proposition 218 public hearing on the fee will be held at 6:30 p.m. March 24, also at the school.

Anyone who owns land in the district, has a legal interest in a district parcel or is responsible to pay the water bill for an affected parcel can submit a protest. Only one protest per parcel is accepted and they can be hand delivered or mailed to the district’s office at 583 San Ysidro Rd, Santa Barbara, CA 93108.

Emailed protests aren’t counted and the protest have to indicate that it is a protest against the water rate increase, include the address or parcel number and the name/signature of the person submitting the protest. Written protests will also be accepted at the March 24 Proposition 218 meeting.

Santa Barbara is also considering increased water rates, with different rates for each customer class. The lowest residential users could face a 92-cent increase per HCF and highest residential users could have a $5.15 increase per HCF. The rates are structured to handle the potential costs of reactivating the desalination plant.

The City Council will hold a public hearing March 10 at 2 p.m. in City Hall at 735 Anacapa St., and the rates could take effect July 1.

Written protests to Santa Barbara's proposed increase can be delivered or mailed to the City Clerk of Santa Barbara at 735 Anacapa St., Santa Barbara, CA, 93101 by March 10. Protests can also be turned in to city staff members during the public hearing.

Noozhawk news editor Giana Magnoli can be reached at .(JavaScript must be enabled to view this email address). Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.

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