Reso 1099-11/1999RESOLUTION NO. 1099
RESOLUTION OF THE BOARD OF DIRECTORS OF THE
VALLECITOS WATER DISTRICT CALLING FOR TIMELY WATER
RATE REFORM BY THE SAN DIEGO COUNTY WATER AUTHORITY
WHEREAS, the Vallecitos Water District (Vallecitos) is a member of the Economic
Study Group (ESG), a group of seven San Diego County Water Authority (CWA) member
water agencies including Fallbrook Public Utility District, Rainbow Municipal Water District,
Rincon del Diablo Municipal Water District, Vallecitos Water District, Valley Center
Municipal Water District, Vista Irrigation District and Yuima Municipal Water District, and
WHEREAS, the ESG contracted with the firm of Bookman-Edmonston Engineering,
Inc. to perform an independent analysis of CWA rates, charges and fees to determine if
revenues contributed to the CWA by ESG members fairly reflected the cost of service
provided by the SDCWA to ESG members; and
WHEREAS, the Bookman-Edmonston report documented that Vallecitos has
overpaid $6.6 million to CWA over the last ten (10) years; and
WHEREAS, the Bookman-Edmonston report further documented an overpayment
to CWA over the last ten (10) years by all ESG agencies of more than $40 million; and
WHEREAS, the Bookman-Edmonston report further documented that eighteen (18)
CWA retail member water agencies have overpaid by approximately $81 million over the
last ten (10) years; and
WHEREAS, among the agencies that have overpaid are North County cities
including Carlsbad, with an overpayment of $11.4 million, Escondido, with an overpayment
of $4.8 million and Oceanside with an overpayment of $6.8 million; and
WHEREAS, the ESG presented to the CWA on May 27, 1999 the findings of the
Bookman-Edmonston report and submitted to the CWA a proposal for reforming the CWA
water rate structure based on the long recognized California Department of Water
Resources/State Water Project "proportionate use" method to allocate capital and operating
expenses; and
WHEREAS, this rate reform structure was proposed because: (1) it is an accepted
method currently used by State project contractors; (2) it is identical to the CWA's position
in the MWD wheeling validation lawsuit; (3) it is very applicable to the CWA's linear
transportation system and, in addition, is wholly consistent with the CWA's adopted rate
reform principles; and
WHEREAS, CWA is undergoing a rate reform study of its own originally scheduled
to be completed and brought to the CWA Board of Directors by January 1, 2000; and
WHEREAS, despite the responsible, diligent and hardworking efforts of the CWA
staff to complete a report by January 1, 2000, the CWA has informed its members that the
Resolution No. 1099
Page 2
study results will be delayed until Spring, 2000 with implementation expected by January
2001; and
WHEREAS, during the period of this delay Vallecitos, according to the Bookman-
Edmonston study, will be overpaying for services provided by the SDCWA on average
about $65,000 per month; and
WHEREAS, this, according to the Bookman-Edmonston study, Vallecitos will over-
pay the CWA by about $780,000 for each year the current rate structure is in place; and
WHEREAS, this delay will also mean that as a whole the ESG agencies will continue
to make overpayments to CWA of about $647,000 per month, and that the monthly
overpayments by 18 member water agencies will continue to amass at the rate of about
$1.6 million per month;
NOW, THEREFORE, BE IT RESOLVED that the Vallecitos Water District
communicate to CWA through this resolution a call for timely water rate reform to end more
than a decade of overpayments; and
BE IT FURTHER RESOLVED, that Vallecitos Water District joins with its fellow ESG
members in communicating to CWA the expectation that a water rate reform report be
considered, discussed, and adopted by the CWA Board per the revised CWA schedule no
later than July 1, 2000, and that the Vallecitos Water District, in good faith, expects the
implementation of a revised water rate structure that rectifies the overpayment by a wide
majority of the CWA agencies no later than January 1, 2001.
PASSED, APPROVED AND ADOPTED by the Board of Directors of the Vallecitos
Water District at a regular meeting held on this 17th day of November, 1999, by the
following roll call vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
CRUZ, DAVY, FERGUSON, HANNAN, MASON
ale Mason, President
Board of Directors
Vallecitos Water District
ATTEST:
William W. Rucker, Secretary
Board of Directors
Vallecitos Water District