Wednesday, May 07, 2014

Want Cheaper Water? Don't Call Golden West.

Last night at the Community Center, well over 100 people showed up for an informational meeting on how the community of Felton (CA) and Ojai (CA) wrestled control of their water service from private companies (in the case of Ojai, it was Golden State Water Co.) and STILL ended up saving money -- tons of money, especially when factoring in projected comparative rates over the length of the buy-out loan. [Updated note: With people coming in late, by meeting's end, a good guestimate of attendance was reported to be closer to 200 people.]

Which was surprising since, at first glance, it seemed an impossibility that if your water rates were already gougingly too high that you could pay top dollar for the company and still come out ahead.  Unless, of course, the water company you're buying out ran on the principle of neglecting infrastructure on one end while gouging customers on the other end in order to keep profits rolling in at an investor-pleasing high rate.  With that kind of business model, then, yeah, a buy out deal makes sense.

And, since the PUC runs on the Insane Mad Hatter bureaucratic model -- if water law is Byzantine to the max, the prices set for various water rates truly heads down the rabbit hole.  As some of the citizens of Los Osos have found out, they're paying a whole lot more for their water than their neighbor is.  Literally, their neighbor.  Same water.  Same aquifer.  Different price.  That's the PUC for you.

So 100++ people listened to a handful of very smart, nice speakers (who were key players in their communities' efforts) from Felton and Ojai outlined the hideous, years-long battle they underwent to de-privitize their water -- from careful feasibility studies, to public education, to a nasty election (outspent by Golden State) to tax themselves to pay for the buyout, (both groups won) to now (in the case of Ojai) facing post-election lawsuits from Golden State Water Company which refuses to go gentle into that good night even though a HUGE majority of its customers clearly voted to get them to go away! 

The nice people from Felton and Ojai were  enthusiastic, vowed to help our own Golden West customers in any way they could, and exhorted them to work seriously to make that change.  But I had to wonder if the nice people from Felton and Ojai were aware of how traumatized and exhausted this whole community is from our own 30 years-old Hideous Sewer Wars.  And how, if Golden West's customers who move forward think they'll get anything but lip service from all the CSD Water Customers, they'll be in for a rude shock. While the CSD customers may well sympathize with them, I can't imagine any of them joining in the heavy lift needed to make a buy-out possible.  And if the plans somehow do progress, Golden West customers will have to convince another "publicly owned / municipal" water district to become their provider and that will be . . .?  the CSD. . . ??? . . .  which is already up to its ears in lawsuits and wrangling, facing a small coterie of foes wishing to destroy it altogether, and looking at water rate raises of its own to pay for long-neglected infrastructure repairs.

So, here we sit.  Half our town gouged by their water purveyor while the other half gets "cheaper" water from an entity being stabbed to death.

So, good luck to the good citizens of Golden State Water Company.  I wish them well.  And while all this shakes out, my recommendation is to start retrofitting everything in the house.  Oh, and get out the shovels and get busy xerescaping everything in sight with California natives. It's gonna be a long, long, long, long hot summer, fall, winter, spring, summer . . . .


Sewertoons AKA Lynette Tornatzky said...

Excellent reporting as I was there too and heard what you heard.

CSD customers will not get to vote to assess themselves if this buyout ever grows legs and it comes to that (only GS water customers get to do that). LOTS of money will be needed to get the word out and pay for the legals (unless there is an attorney out there who wants to work for years for free...) and anyone can contribute to that, customer or not!

However, the CSD would be the only likely water serving entity in town with enough gravitas to be allowed to run the new water enterprise, if it gets to that point, and the PUC gets to determine if it is sturdy enough to do that that job. Good thing this is years away if it happens at all as the CSD just coming out of bankruptcy is not looking like it is such a sterling candidate at the moment.

And if there is enough firepower still left in this tired little town to rally the troops for the buyout, they better contact those wishing to sink the CSD and convince them to cease and desist, starting now. Otherwise, the water entity available to run it just might be Golden State with a buyout of their own if the CSD goes away, or the County (which those folks loathe anyway).

Yes, good luck Golden State customers!!!

FOGSWAMP said...

Indeed it was a very informative meeting and a great turnout.

At the close someone mentioned the Community Facilities Act (Mello-Roos 1978) alleged funding violation according to GSW in their appeal.

Some refer to this act as an end run around Prop 13 which they claim has been abused by greedy developers for over 20 years.

Should the appeal be upheld, it would undoubtedly
rusult in endless legal fees to keep the takeover alive.

Without funding the takeover is dead in the water.

The 87% vote in Ojai reminds me of our takeover of the sewer project from the county with about 87% aboard the train wreck.

Nobody said it would be easy, I wish them well.

Sewertoons AKA Lynette Tornatzky said...

Well FOG, there we were in the same room and I at least didn't know it! Next time, if you know what I look like, come over and say hello!

I'm not sure I know what you mean about Mello-Roos as being considered an end run end run around Prop 13. It is a facilitator for funds and it requires a 2/3rds vote. Operative word = VOTE. I don't get the developer part as it seems to be used to get money for schools or infrastructure that would otherwise not be forthcoming.

If voters having voted then become unengaged or uninformed.... well, don't be surprised where things go!

There was a current in the room that seemed to say, "the voting platform for CSD directors in the fall should be supportive of the takeover."

Churadogs said...

Toonces, while the people living in the CSD area can't vote on the matter, it would be interesting if any CSD candidates made the issue (pro or con) part of their platforms.You recall the speaker from Ojai talking about "courting" their municipal water district so they would consider taking over. Something similar would have to be done here, though,, as you point out, who takes over whom may be another issue here.

Sewertoons AKA Lynette Tornatzky said...

Yes, courting was done, and thinking of that, maybe the LOCSD customers would need some courting too, as I can only imagine what the fears would be if they were hit with this as it was about to happen. Knowing nothing, they could imagine the worst.

Sewertoons AKA Lynette Tornatzky said...

You know, I am surprised that there is so little conversation about this here.

FOGSWAMP said...

Toons ......... Perhaps the general malaise is a direct result of the $800,000.00 (or so) gamble to make it happen. That's a hell of a lot of $$$ to expect to raise from our already strapped community.

There has to be a better way to level the playing field.

How about legislating the PUC to enforce caps in communities with public & private water delivery systems?

It's interesting & sad to note the current rush to privatize water services around the globe being pushed by the World Bank & IMF through stipulations in trade agreements and loan agreements to developing countries.

Also check out England & France's unbelievable recent privatization.

Sewertoons AKA Lynette Tornatzky said...

FOGSWAMP, you are right. The cold light of day has hit, the ebullient enthusiasm of the crowd in a room has evaporated. There is little energy or money left in this town to go beyond a sewer.

Can anyone legislate the PUC to do anything? There must be the will. In any case, our LOCSD enterprise system, or any enterprise system can never be as expensive as one that must make a profit and the comparison will always look bad. I can hear the squawking the for-profits would make at anyone telling them how much money they should be allowed to make.

I am behind on the privatization issue these days and even "back when" it was quite alarming. I'll go take a look, thanks!