STPUD to vote on budget after rate hike is settled
By Claire Fortier
How could the South Tahoe Public Utilities District justify a 4 percent increase when the economy of South Lake Tahoe has flat lined?
That was the question asked by a half dozen people who addressed the STPUD board during its public hearing Thursday night. The board answered by directing STPUD staff to present a budget based on a hike of just 2 percent at its May 20 meeting at 2pm.
About 30 people filled the utility district’s board room for more than two hours.
“We need to be active about replacing our water and our sewer line, but this is not the right time for a 4 percent increase,” board Chairman Dale Rise said. “Cutting that hike down the middle will give staff the tools they need to do their jobs without severely impacting our ratepayers.”
The board’s decision to reduce the rate hike was as much a shout out to STPUD’s staff, which found more than $8 million in grant funding and $19.6 million in low interest state loans to cover critical capital improvement costs, as it was to the public’s outcry over rising rates.
“Can you justify 4 percent? Yes,” Ken Curtzwiler, a candidate last year for the STPUD board, told the elected officials. “But is it the right thing to do? Overall, the rate increase is not much compared to other people around the lake who are paying as much as 77 percent more. But when the entire community is down 15 percent, how can you justify going up at all?”
Driving the rate hikes is an extensive $136 million, 10-year capital improvement program that is top heavy with projects in the first two years. Many of those projects are being paid out of federal stimulus funds.
Topping the list for STPUD is replacing the Headworks, the 1950’s structure through which all the district’s wastewater flows. “This structure is in bad shape and deteriorating rapidly,” said Paul Sciuto, STPUD’s assistant general manager.
Replacing and maintaining the district’s 336 miles of pipelines inside the Tahoe basin and the 26 miles of export line outside the basin, as well as the 44 pumping stations is a “massive investment of infrastructure,” Sciuto said. Almost 150,000 feet of line within the basin is undersized and must be replaced for adequate fire protection. Another 180,000 feet of recently replaced pipe may have to be redone if a whistle-blower prevails in a national lawsuit over bad PVC pipe.
“If we had used the industry rule of thumb,” board member Jim Jones, “we should have increased our revenues $16 (million) to $32 million a year. We are only putting in about one-third of what we should be.”
In addition to federal stimulus money, STPUD has benefited from lower contractor bids on major projects and internal cost-cutting measures.
None of the additional revenue generated by a rate hike will go toward staff salaries or benefits. And the district anticipates no additional staffing for five years.
Despite no increase in salaries or benefits for staff in the immediate future, several members of the audience called for staff cuts or furloughs.
“Four percent, it’s not much, but it’s a lot to me and many others in this community,” Jake Jacobs said. “I have taken a major hit to my income. Maybe it’s time the employees in the district share that pain as well.”
Rise said, “The way our contracts are with our staff, there is a zero percent increase. But no increase in rates in not the right and prudent thing to do because we need to maintain our water and sewer lines. It will be much more expensive down the road if we do nothing now.”
Jonnie Crawford questioned whether it’s possible to wait on some of these projects until the economy starts to improve.
Board member Eric Shafer pointed out that with the stimulus money if it’s not spent now, the money is lost.
Much of the money STPUD receives from the state and federal governments requires matching dollars from the district.
More than one person pointed out that if the infrastructure is not fixed now, it will cost more down the line.
I have a question:
With the current condition of the sewer,water lines ,being in bad shape,why wasn’t this address back in the times of the good economy growth?(Bush years)
I have often wonder with the condition of our streets with so many cracked portion of the pavement missing or complete gone ,does this help in letting the water destroy the sewer,water system lines ?
Another Thing?
Someone had to have the data previous to this rate increase.Did all the man power hours with our city agencies ever look into this or were they too busy wasting lot’s resources for the never ending Convention Center equation instead ? That’s all the council ever talked about for last 10 to 12 years,lot’s money was spent on that Pink Elephant in man power hours, consultants, Research ? SHOULD THE FOCUS BEEN ON OUR OWN INFRASTRUCTURE INSTEAD?
HTMAL,
STPUD has been raising our rates 4% per year for as long as I can remember. It’s only now when residents and business’ are on the edge that people are questioning the rate increases, as well as the salaries and benefits of STPUD employees that are higher than those who pay them. Make sure you turn in your protest vote.
Maybe if STPUD investigated and either removed or made violators pay for their illegal bathrooms, kitchens and living quarters, a rate increase wouldn’t be needed for awhile. Just on my street I can think of 3 and maybe 4 illegal baths. How many would this amount to in all of the city and county combined? How does stpud catch these illegal units?
annoyed, the whole pay per toilet/kitchen sink rule is ludicrous! I have never heard of any other place charging this, it’s a scam in my opinion. Switch to meters, and charge for the water used, duh.
Care, that might sound good,but here, use some logic about the meters issue.
Take into account 70% people are gone in the winter months,(lose money.)
Take into account how much finance would be needed,(probably passed on to the rate payers for installation of meters ) higher rates.
I REMEMBER WHEN SPUD OFFERED THE 80 BUCKS BACK ON YOUR BILL IF YOU CONVERT TO A LOW FLOW TOILET.Years ago.
I took advantage of that,did anyone else?
Somewhere in the equation there’s got be a fair rate for all.Including the spuds employees, the rate payer, and the need for improvement.
Seems since the T.R.P.A. makes things so difficult with water and all the laws that criss cross the life here, you think they could be part the solution.
Washington writes them big fat pay checks ,why aren’t they a Speaker in Washington to get funds to fix these problems, instead fining the hell at the tree huggers,porch,deck builders,parking lot coverage?
Feds deal best with their own kind!
careaboutthecommunity
There is still a charge for hooking up the extra sewer unit. And then you pay for what you use. And in my neighborhood, this extra sewer unit gives my neighbors an extra bath/kitchen which allows them to illegally rent out an extra “unit”. My neighborhood is zoned single family, not multiple. This single family zoning should make all vacation rentals illegal, because these 3000 to 5000 square foot “hotels” which have been built in the last few years as rentals accomodate several “families”. Nothing like illegal hotels destroying our peaceful neighborhoods!
STPUD is mandated by the State of California to install water meters on all services by 2025. This measure was adopted by the State legislature to further water conservation. STPUD tried unsuccessfully for exclusion from this as we have no water shortage in the Basin, but was unsuccessful. So far they have been successful in obtaining grant funding for water meter installation and hopefully will continue to obtain grants for the remainder of installations. Businesses and multiple family dwellings have been metered for years.
Hey JOHN, How about vacation rentals? Are they metered? After all they are a business and house way too many people, way over the amount that would ever live there as full time residents! Just another reason to get rid of these illegal hotels in our neighborhoods!
Steven,
No at present they are not metered unless they were built recently and had the meter installed during connection to STPUD as most current constructions have. I live one house away from one and agree that they are a problem that has been insufficiently dealt with.
To John regarding “STPUD tried unsuccessfully for exclusion from this as we have no water shortage in the Basin…” My understanding is the request was for an extension on the (unfunded state mandated) deadline because we have fewer months for meter installation.
Then why didn’t STPUD install water meters on the 185,000 lineal feet of water lines already replaced excepting services with 1″ or larger service during existing building seasons?
The real reason that the District has dragged their feet on installing meters is that the District will lose money on billing when the meters are installed. The District had been saying that only 15% of customer charges would be based upon water usage and 85% upon fixed costs. As Rhonda McFarlane, past District CFO, stated at the rate increase meeting, this is untrue. The CPUC states that “no more than 50% of charges can be based on fixed costs”, not the 85% the District was claiming. The CPUC is not the controling agency for the District, but it is the basis for the guidelines used. Using 15% of billing costs as a differential does not provide the impetus to ratepayers to conserve water usage, which is the purpose of the State mandate.
If you would have gone to the STPUD rate hike meeting you would have gotten your answer from Mr. Jones. I asked him the same thing and also why our own workers, STPUD, were not doing the installations or why they were not trained to do so earlier. His answer was that they knew about the state mandate but they thought they would get an exemption which was a pipe dream. They decided that they would get the exemption and not have to worry about it. Piss poor planning on their part translated into lost local labor hours, lost local labor dollars in the community and the possible hiring of more local workers to do the installations which were getting no match grants anyway. He actually thought we would get exempt from a state mandated law so there was no prior planning. This is the same guy who wants to give a rate hike 3 times what it is now. According to the BOD President our workers are trained on how to do this, it isn’t rocket science, and some are being done but the major majority of the $4.35 million grant money for the work is going to 2 outside firms, one from Sac and one from Sparks thus adding to our projected town unemployment. This rate hike will go through unless we call each BOD at home and ask them not to as we will never get enough written protest letters, only 77 so far which is less than .05%.
Skibum,
It was a rhetorical question to Julie Threewit. I would have been at the meeting as I have been for the last 3 or 4 years, as was pointed out by Board President Rise during the meeting, but I had previous commitment.
Hi Claire long time. Do you remember when David Kurtzman was appointed by John Upton to be a Pro Active member of STPUD. I do not recall much if any, pro-activity.