Thursday, September 18, 2014
YOLO COUNTY NEWS
99 CENTS

City Council elects to tie water project rates to all-debt financing payment method

By
From page A1 | January 16, 2013 |

Conscious of a dramatic spike in utility bills, driven by the looming cost of the Woodland-Davis Clean Water Agency surface water project, the City Council signed off Tuesday on a proposed water rate hike tied to a scenario where the city would pay for the project entirely through debt financing.

Based on numbers the city provided to the council at their meeting, all-debt financing likely would smooth out rates for residents over the first five to seven years of the project, softening the blow to the consumer.

Compared to what city staff had been proposing, all-debt financing would lower rates — which city engineers have estimated will triple water bills during the next five years — by about 15 percent.

The council was asked Tuesday to approve water rates for five years that would be included on Proposition 218 notices that the city will send out later this month to inform property owners of the proposed rate increases.

The city needs to pump up water rates in order to begin to pay off the $113 million surface water project that will siphon water from the Sacramento River, treat it and pipe it to Davis and Woodland to replace each municipality’s existing ground well water supplies.

The Prop. 218 process allows cities to set maximum rates that the council can implement each year based on the revenue the city needs to generate in order to fund the city’s water utility.

City staff, including Herb Niederberger, the city’s general manager of utilities operations and development, recommended Tuesday that the council approve rates with a more diversified financing approach in order to receive the best bond rating possible.

But that would mean higher costs to the ratepayers up-front.

So, following some deliberation after receiving a handful of public comments from local business stakeholders — all of whom spoke to the immediate jump in rates that city staff was proposing — the City Council unanimously decided that the city should pay for the project entirely through debt financing.

“While it would be nice to have the ability to pay less over the full life of the project, I think for many residential customers, the increases are rather steep,” Councilman Brett Lee said. “I think it’s always nicer to have a slower ramp up until you hit that rate.”

On the other hand, as City Manager Steve Pinkerton pointed out, because the city would be deferring costs and — in essence — increasing the amount of revenue the city would need to generate overall, in roughly 10 years rates would consistently be higher until the project is completely paid off in 2050.

But Lee and the rest of the council would not be dissuaded.

“We get an extra four years (in the beginning) to get to that level of payment required from the customers, so basically we’re almost doubling the amount of time that people have to ramp up to the new, higher rates,” Lee said.

Prop. 218 notices including the five-year rate schedule and the rate structure, as well as information on the public hearing, will be sent out at the end of the month.

The public hearing will take place on March 19 in the Community Chambers of City Hall, 23 Russell Blvd. More than half of the city’s approximately 16,000 property owners must file written protest to block the water rate increase.

The City Council has placed the project up for a public vote through an all mail-in election of Measure I. Ballots asking whether registered voters approve of the city moving forward with the project will be sent out the week of Feb. 4 and are due back to the Yolo County Elections Office by March 5.

If the majority of the voting public votes No on the project, the city says it will still have to raise rates in order to maintain the city’s water utility. According to city numbers, rates would increase by 50 percent over the next five years without the surface water project on the books.

— Reach Tom Sakash at tsakash@davisenterprise.net or 530-747-8057. Follow him on Twitter @TomSakash Follow all Davis water news using #daviswater

Comments

comments

Tom Sakash

Tom Sakash covers the city beat for The Davis Enterprise. Reach him at tsakash@davisenterprise.net, (530) 747-8057 or @TomSakash.
  • Recent Posts

  • Enter your email address to subscribe to this newspaper and receive notifications of new articles by email.

  • .

    News

     
    Jurors see Marsh questioned by police

    By Lauren Keene | From Page: A1

     
    Grace Garden: Five years of feeding the needy

    By Special to The Enterprise | From Page: A1

     
    For the record

    By Enterprise staff | From Page: A2

     
    Bike sale on Friday will benefit King High

    By Jeff Hudson | From Page: A2

    Wildfire shows explosive growth

    By The Associated Press | From Page: A2 | Gallery

     
    Per Capita Davis: What to think

    By John Mott-Smith | From Page: A3

    International Festival moves to park for fourth year

    By Special to The Enterprise | From Page: A3

     
    Essay contest underway

    By Special to The Enterprise | From Page: A4

    Sudwerk Wet Hop Lager plants seeds for area hops rebirth

    By Wendy Weitzel | From Page: A4 | Gallery

     
    Speakers plumb issues around the Constitution

    By Enterprise staff | From Page: A4

    Nominate deserving volunteers for top citizen honors

    By Enterprise staff | From Page: A5

     
    Governor signs bill to support state’s ailing bee population

    By Special to The Enterprise | From Page: A5

    Backyard poultry symposium Sunday at UCD

    By Tanya Perez | From Page: A5

     
    Forum will answer questions about new license law

    By Enterprise staff | From Page: A5

    Australian pop band Dick Diver plays Third Space

    By Enterprise staff | From Page: A5

     
    RepowerYolo hosts solar seminar

    By Enterprise staff | From Page: A5

    Local Girl Scouts are looking for a few good leaders

    By Anne Ternus-Bellamy | From Page: A5

     
    Reneau, Silberstein will read their poetry Thursday

    By Enterprise staff | From Page: A5 | Gallery

    Parents host campaign coffees for Archer

    By Enterprise staff | From Page: A5

     
    PG&E, Dixon company unveil truck that can restore power

    By Enterprise staff | From Page: A7 | Gallery

    $12M earmarked for UCD life sciences center in Chile

    By Karen Nikos-Rose | From Page: A7

     
    .

    Forum

    She’s had it with his neglect

    By Creators Syndicate | From Page: B5

     
    Off-leash dogs are a danger

    By Letters to the Editor | From Page: A6

    Davis makes the NY Times

    By Letters to the Editor | From Page: A6

     
    Affordable housing affects health

    By Special to The Enterprise | From Page: A6

    Choose to wipe out hunger

    By Special to The Enterprise | From Page: A6

     
    Tom Meyer cartoon

    By Debbie Davis | From Page: A6

    .

    Sports

    Devils blow out Marauders at Brown Stadium

    By Evan Ream | From Page: B1 | Gallery

     
    DHS girls pound Mustangs in the pool

    By Enterprise staff | From Page: B1

    Davis captures final nonleague volleyball outing

    By Enterprise staff | From Page: B1 | Gallery

     
    DHS golfers blow past St. Francis

    By Enterprise staff | From Page: B1 | Gallery

    Youth softball: Hurricanes win one of two slugfests with Woodland

    By Enterprise staff | From Page: B2 | Gallery

     
    Youth roundup: These Diamonds are forever in the record books

    By Enterprise staff | From Page: B2 | Gallery

    Baseball roundup: Duffy comes up big for Giants in Arizona

    By The Associated Press | From Page: B3

     
    Young Devil harriers carry the day

    By Enterprise staff | From Page: B3

    Davis falls to Vintage in a JV shootout

    By Spencer Ault | From Page: B3

     
    DHS girls tennis team stunned at Franklin

    By Enterprise staff | From Page: B8

    .

    Features

    Street-smart tips for safe cycling

    By Anne Ternus-Bellamy | From Page: A8

     
    What’s happening, Sept. 18

    By Anne Ternus-Bellamy | From Page: A8

    Students get into the act with Shakespeare

    By Anne Ternus-Bellamy | From Page: A8 | Gallery

     
    Eagle Scout project makes life easier for Yolo Basin volunteers

    By Anne Ternus-Bellamy | From Page: A10 | Gallery

    .

    Arts

     
    Wineaux: Back and forth in the high and low debate

    By Susan Leonardi | From Page: A9

    Catie Curtis brings folk-rock ‘Flying Dream’ to The Palms on Friday Sept. 19

    By Special to The Enterprise | From Page: A9 | Gallery

     
    .

    Business

    .

    Obituaries

    Jean Botelli

    By Special to The Enterprise | From Page: A4

     
    .

    Comics

    Comics: Thursday, September 18, 2014

    By Creator | From Page: B6