Since 2002, the city’s sewer rates have increased almost 200%, from $4.69754 per 100 cubic feet of water consumption to $8.01056 for this fiscal year, and a proposed $9.51463 for 2008-2009. While the city floated the $51 million in bonds to build the “state of the art” Calera Creek Waste Treatment Plant 8 years ago, NONE of these increases have been applied to principal payment of these bonds. In fact, the sewer bonds were recast several years ago to be interest only.
Yet this “state of the art” facility has continually violated discharge levels and the Clean Water Act (2005), been repeatedly cited and fined by the California Regional Water Quality Control Board almost 200 times, and recently had a spill of 7.5 million gallons of partially treated sewage that went undisclosed to the public by our City Council. Not to mention the odor problems that make some days in Vallemar and Sharp Park unbearable. The "fix" to the digesters has been ongoing and, during last year's election cycle, we were assured the costs would be $200,000.
Because the city chose experimental technology with a company that has since gone out of business, these fixes have been prolonged for years at an estimated cost of $2 million, with no certainty the smell issues will be completely abated.
So where did this money go from all these rate increases?
As a responsible homeowner, I would be certain to attend the sewer service charge increase meeting in Council Chambers at 7PM on May 12, 2008. You can also file a written protest with the city by submitting a letter which simply states your name, address, signature, date, and words to the effect of "I protest the proposed sewer rate increase."
5 comments:
Jeff, what are "in-lieu property taxes"?
You're saying the City Council used funds that should have been dedicated to payment of the Treatment Plant bonds to pay for other city stuff?
Is this a standard procedure? Do we know if other towns do this?
Are you suggesting malfeasance...or just bad policy?
Either one is totally valid, I just want to be clear on the problem.
"Payments In Lieu of Taxes (PILOT)" was a legal loophole that allowed the city to transfer money from the Sewer Enterprise to the General Fund.
PILOT were basically a way of saying if the sewer plant were run as a private enterprise, they would pay property taxes and other taxes to the city. The city "estimated" those taxes to be $700,000 per year (pretty generous, hunh?)
Proposition 218 says the money we pay to the Sewer Enterprise can only be used specifically for the purposes of the sewer plant operation, maintenance, or debt obligation.
There were a number of other cities who employed these transfers, but the recent "Big Horn" decision made such transfers illegal.
I would consider the acts of the city council in this regard to be gross malfeasance.
There were 2 significant impacts of this practice (and the Big Horn decision).
First of all, certain council members campaigned 2 years ago on the pretense of a "healthy" economy. They were either aware of the impact of the Big Horn decision at the time (as I have found evidence of other cities who used the PILOT transfers discussing the fiscal impact of Big Horn as early as July 2006) or they were not properly informed by city staff. There was also a contentious Measure on the ballot to bring development to the city (and much needed revenue) that was defeated, in part, because of the assurance of city leadership that everything was fine economically.
(One of my bones of contention with city council is that they knew the ship was sinking, but failed to show the leadership to acknowledge it because they did not want Measure L to pass.)
Anyway, our $1.1 million dollar General Fund structural deficit in 2007 was primarily due to that $700,000 in revenue being kept in the Sewer Enterprise. The impact to city services was enormous, including the loss of 3 firefighters (which should not have happened with the Fire Assessment, but that's another complaint for another day).
The more important issue is that the city used that $700,000 transfer for several years to cover up the lack of growth of the General Fund. At the same time, we were still dealing with the odor issues, spills, and discharge violations at the sewer plant, AND we were not paying ANY principal on the sewer bonds.
The question isn't whether or not it was legal to transfer this money (it was at the time), the question is whether or not it was responsible management of the Sewer Enterprise (it wasn't) that has now forced the impacts of this mismanagement on the shoulders of the residents.
one of the easiest ways to bypass prop 13 used to be to raise "fees" oaid to the the sewer fund then transfer them to the general fund calling them any number of things. one other way that money can be moved is charging employee expenses, salaries etc., to the fund and transferring those payments to the general fund. no public input, no vote. the sewer fund needs more money to pay those fees and transfers so they raise rates with no vote needed. voila, the gen fund has increased revenue by indirectly taxing the populace.
wags
Hi Anon,
Good comment. But...would you mind signing your comment with a name...any old name! If more than one person comments anonymously, it's hard to keep them straight!
Just click on Name/URL when signing your comment...and make one up so we know who we're talking to.
(The URL is optional)
So, government does stuff with the books that if we did it we'd go to jail, right?
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