Davis public officials, including three members from the Woodland-Davis Clean Water Agency, on Wednesday held a question and answer session about the new water project and the accompanying rate hikes associated with the project.
Bob Clarke, who is the acting public works director, and Diane Jensen would give an overview of the process and rate hikes.
According to their information, the water rates approved would see at its maximum rate an increase of the typical Single Family Residential customer’s monthly rate to go from $35 per month to $68 per month by 2017. That assumes a 14% increase which, despite what other press accounts told the public, calculates to a 92.5% rate increase over the five-year period (you cannot simply add the rates together, because the increases are compounded each year).
Furthermore, under present assumptions this will require a sixth-year increase of 14%, which would be noticed for next year. That would propel the typical household rate to $77.50 which would mark a 128% rate increase over the six-year period, or 2.25 times the current rate.
The city argued that final rates are significantly reduced from those in the original Prop 218 notice. The increased revenues will support infrastructure financing. They argued that Council will consider annually the ability to adjust rates lower than the maximum – although many argue that once bonds are purchased and the project is bid for, the maximum will become the minimum.
They also attempted to explain why they have done the surface water project at this time and talked about the problems with the current wells and projected cost increases. They talked of the concerns about new standards for hexavalent chromium, which is best known as the culprit in the Erin Brockovich matter.
The city is also concerned that the use of intermediate and deep aquifers could cause subsidence problems.
They also talked about opportunity. There is a low cost of construction and financing now, with the economic downturn. Moreover, Woodland has to do this project and, therefore, the opportunity to cost-share through a partnership was alluring. They argued the joint intake option from the river could be risked if there is delay, and that they wish to avoid potential fines in 2017.
The public questions were a huge component of this. One student pointed out that just as the water rates become operational, tuition is expected to go up perhaps as high as $22,000 per year. He asked, “It’s a large brunt on us, how are we expected to pay for that?”
Mayor Krovoza pointed out that a lot of students do not live in the city. Students who live on campus have metered water.
But the main thrust of his argument is that, given the fines and changes in discharge requirements, somewhere down the line we will have to pay for that. He also explained that there were also about 20 wells that they had to pay to maintain and keep operational – a cost that is increasing.
Bob Clarke argued that price increases are not insignificant, costs will invariably go up, and it makes for some tough choices.
He also pointed out that is why they have highlighted conservation. In short he argued, “I still think it’s the right step to take.”
Stephen Souza said that not a day goes by when he does not think of ways to cut costs and the impact on the residents. He pointed out he too is a ratepayer and therefore he is well aware of the pain this may cause residents.
Another individual for the city pointed out that conservation efforts have downsized the needed capacity of the wastewater treatment plant, which in turn has helped to drive down the costs of that plant.
Matt Williams, a member of the public, said that he does not see the wastewater treatment and surface water plan as mutually exclusive or separate. He said, “I don’t see them separate at all.”
He pointed out that right now we are dealing with groundwater issues that are also inputs to the wastewater treatment. He wondered if we go forward with the wastewater treatment option now, if we are not risking over-engineering.
He pointed out that, while the wastewater costs are already in place, the project itself is $100 million, while surface water is $150 million, which means that wastewater is a significant 40% of the costs.
He asked, “Why should we go forward with wastewater treatment before the surface water project is completed?”
Bob Clarke explained that, in fact, the issues are separate except for selenium. There are different constituents that are driving the need for surface water than wastewater. So, even if we got relief for some of those constituents, we would still need both projects to deal with all of the discharge problems.
Tess, the water attorney, argued that the wastewater permit is very pollutant-specific, and those pollutants are mostly unrelated to the wastewater project, with selenium as the exception.
Another individual said that it looks like the water demand in Davis is expected to rise despite conservation efforts, and he asked if that means that more water means expansion of the city.
Joe Krovoza argued that growth in Davis is controlled both by the general plan cap of 1 percent per year and Measures J and R which require a vote for new development outside the current city boundaries. He said this project is neither pro-growth nor anti-growth, it is there to meet the needs of the city.
In response to more concerns about cost and process, Mayor Krovoza said that the rate increase went through the Proposition 218 process, that the city went well above and beyond the call of duty, and they simplified the process as much as possible with two notices, one the typical Prop 218 notice and the other a simpler form that people could return to protest.
He argued that this felt like they were meeting the council’s obligation to inform the public and allow feedback. However, if the citizens decide that representative democracy has not served them well, people have the right to put it to the vote of the people.
There were questions about the billing cycle for sewer rates and the fact that they are calculated based on usage during peak months. Councilmember Souza said that they began this two years ago and that this will help make people more cognizant of their water usage and how they can reduce it. He hopes this will lead to innovations to cut back on water use.
With all of the focus on water use, conservation has come up. But the point was made that fixed capital costs would lead to rate increases if everyone conserves water use, since the costs are fixed.
Bob Clarke dispelled that as a myth, arguing that they have built their model based on expectations of fluctuation and conservation, and as long as those fluctuations do not result in millions of dollar swings in water use, he does not believe it will be a problem.
There were questions about water permits and summer usage. Mayor Krovoza argued that there were two sources of water. One that will provide us with plenty of water – 45,000 acre-feet of water is the winter water rate, which is free except for the storage and transportation of the water.
Summer water is in short supply, and that is when the demand is highest for water plants, recreation, etc. The city, along with Woodland, purchased 10,000 acre-feet of water from Conaway Ranch. That will be an extra supply for the summer, from a very senior water rights priority which dates back to the 1910s. The current plan is to have six of the high-quality deep wells supplement this source of water. However, in dry years that 10,000 acre-feet reduces down to 7,500.
Another issue is whether Woodland will be able to afford the surface water project. Ms. Dote pointed out that they are already paying fines and would have to do the project even without Davis’ involvement. Their permits have expired and they have concerns about Davis holding up its end of the bargain.
—David M. Greenwald reporting
This article very well captured the give and take between the panel of experts and the audience. The only thing omitted was Council member Sue Greenwald’s final “statement”, which was not in the form of a question, which was what was required of the rest of the audience. Mayor Krovoza graciously allowed Council member Greenwald to depart from the Q&A format, and state her position in a somewhat lengthy comment. A minor dust-up occurred when she started to get into a “debate” and began criticizing statements panel members had said, rather than simply sticking to making her statement, a “debate” which Mayor Krovoza did not allow because it would have been improper. Council member Greenwald can feel free to address her points encapsulated in the statement she made if she so desires. I took notes, but don’t want to be accused of putting words in her mouth. It would be best if she presented her own points in her own words, and I encourage her to do so.
Except for the minor contretemps with Council member Greenwald, the panel discussion was very polite and informative, and all due deference was given to audience members by the panel. Members were generally allowed to ask multiple questions, and the panel fielded the questions to the best of their abilities. No one went away without their questions being answered, including my very last question.
I asked as delicately as I could about the rumor/belief being floated about Davis that Woodland may not be able to afford its end of the surface water project. Two officials from Woodland were kind enough to answer my question (including the Mayor of Woodland), and appreciated the delicacy w which I stated it. Essentially what was said was the city of Woodland is more concerned about Davis holding up its end of the bargain, but they will go it alone if they must. They feel they have no choice. That is because they are ALREADY PAYING FINES because their permits for a variance have already expired, and their wastewater discharge is not in compliance w the new standards. They started a water advisory committee some time ago to keep costs down. Woodland will be paying a larger portion of the surface water project because they are expected to use more of the surface water than Davis will.
The city of Woodland has already gone through a Prop 218 process, and will have to repeat the process again to increase the rates to the level needed to fund their share of the surface water project. Woodland has had plenty of public outreach, and increased their water rates 20% the last 3 years and will do so again in the next year. But they will require another Prop 218 process to increase rates another 80% over the next 4 years. The City Council has unanimously approved the surface water project as the least expensive alternative for both cities, provided the two cities partner together.
A member of the Dept of Public Works was kind enough to sit down with me at the end of the meeting to discuss some issues. I was extremely tired, so I am not certain I took all of what he said in. Actually I am certain I did not take it all in, but here were a few points I feel are worth noting:
1) Salinity variance procedures are not even in place yet, so we couldn’t apply for a salinity variance right now even if we wanted to.
2) The city is always involved in the variance process in one form or another. It is a complicated process of city staff joining with other water users, joining forces, writing support letters, to encourage the SWRCB to take reasonable positions on various constituent limits. This is a process that is taking place at all times in an ongoing methodology.
3) $100 million was indeed saved on the wastewater treatment side (thanks to the vigilance of Council member Sue Greenwald), by paring back some of the runaway requirements that were being requested by the former City Council under City Manager Bill Emlen’s tutelage.
4) Since the variance issue is being addressed on on an ongoing basis anyway, it is a deflection of the more important problems. The more crucial issues to consider for the surface water project are the subsidence issues of the existing wells; and the two main pollutants the surface water project is expected to address – selenium and salt.
This is a highly contentious and unsettling issue. I truly respect both sides of the issue. As Mayor Krovoza so eloquently said,if citizens strongly feel this matter should be placed on a referendum for the people to vote again on this issue (or for renters to vote on it for the first time), then that is a public process referendum supporters have a right to do. I am always in favor of proper process, and strongly agree with the Mayor on this one.
[quote]I believe the City Council and Dept. of Public Works in Davis have done everything possible to make this process transparent/accessible to the public. Bob Weir, former Director of the Dept of Public Works came to the Davis Senior Citizens Commission some years ago, and met with us to discuss the entire surface water/wastewater treatment plant upgrade issue. We have always been able to approach them with questions whenever we wanted. Under the direction of Interim Director of the Dept of Public Works, there have been numerous efforts at public outreach, either in mailed notices, citizen forums, newspaper articles in the Davis Enterprise and the Davis Vanguard blog.
There was also a group of business people and citizens, including myself, who worked very hard with the Dept of Public Works, to convince the city to pare back the water rate increases to a more manageable level for both residences and businesses. As a consequence of that effort, and I strongly commend that group of interested citizens (and you know who you are) who had the courage and tenacity to ask the tough questions, a citizen advisory committee will be formed to continue the process of asking the tough questions. In this way, difficult inquiries will be asked every step of the way. Rate increases will be revisited by the City Council every year, with the idea in mind to keep pushing for cost cutting measures.
As Council member Steve Souza has pointed out, we have already managed to obtain federal grant money of $20 million for design work on this project. The JPA will be pushing elected officials in high places behind the scenes to get every bit of grant money that is available out there. Even in this abysmal economy, there is, unbelievably, pots of money for these sorts of projects, that can be applied for. No one is saying it is guaranteed or will be easy. But already we have received $20 million. Council member Steve Souza can jump in here if I have misspoken or don’t have something quite right.
I am not totally comfortable with this project – I don’t think anyone is. It is essentially a risk analysis. Which way presents the greatest/least risk.? Reasonable minds can disagree. What doesn’t seem to be in too much disagreement is that we need the surface water project. For most, it is a matter of timing. For various reasons which I have stated in previous posts, it would seem to me it should be sooner than later. Delay, in my opinion is going to be MORE COSTLY IN THE LONG RUN, and the only thing we could have to show for it is the payment of steep fines for noncompliance, as Woodland has already been faced with.[/quote]
Don’t know why second part of my commentary ended up in blue – it was not intentional. This newfangled technology sometimes gets the better of me – many apologies…
Lets get on with it already… our water rates are going up either way, either get good water for it, or pay fines…
Drat, I am tired today – I forgot to mention the name of the current Interim Director of Davis Dept of Public Works Bob Clarke – forgive me Bob!!!
Here are two water cost surveys that have been sent to me. I am happy to upload pdf files, charts, tables, etc., to my server and provide links. I can attribute who sent them, or not, as you prefer. I think it would be useful to begin gathering these resources in one place, as they can be hard to locate on the web. Feel free to send me anything at donshor@gmail.com.
[url]http://davismerchants.org/2009RateSurvey.pdf[/url]
[url]http://davismerchants.org/2006waterratesurvey.pdf[/url]
As follow-up to my question last night regarding the Wastewater Treatment upgrade, I would like to see:
1) what portion of the $100 million upgrade costs is for the Tertiary Treatment (filtering of the current secondary treatment output), and what portion for other non-Tertiary upgrades, and
2) what the fine amounts are that Woodland is currently paying for its Wastewater Treatment Plant non-compliance.
3) what is the current construction timeline for the Wastewater Treatment Plant upgrades.
Armed with those inputs we could make a much more educated decision about the timing of the Wastewater Treatment upgrades. It is clear that the upgrades do need to be completed, but what isn’t clear is the optimal timing of those upgrades.
Make sure to sign those Referendum petitions when you see your friendly signature acquirer around town. Say hi while you’re at it. 🙂
I was very disappointed by the amount of misinformation presented last night. I don’t have time to do a write up now, but I’ll submit an entire article soon.
[i]Make sure to sign those Referendum petitions when you see your friendly signature acquirer around town. Say hi while you’re at it. 🙂 [/i]
I personally think putting this issue on a ballot is a costly exercise in futility. It will only add another $250,000 of cost to the project. I don’t expect that the majority of Davis voters will walk into their polling place and be able to make a vote that is truly informed.
That may be cynical, but it is how I feel.
“I don’t expect that the majority of Davis voters will walk into their polling place and be able to make a vote that is truly informed.”
It only takes a majority of the people that “do vote” to defeat this. I say that the citizens against the project are much more highly energized and will get out and vote. How many people are truly informed when it comes to any election? After all, a majority did elect Obama.
But that begs the question rusty, “Is [i]defeating this[/i] the wisest decision?”
The answer to that question isn’t simple. However, I do believe that continuing to deplete our groundwater is eventually going to create a crisis that our children will have to deal with and pay for. For me, the conversion to surface water is the right strategic direction, but the tactical components of implementing that strategic direction continue to be suboptimal. I would like to see us focus on improving the tactical components.
Matt, I agree that we need to improve our tactics. That’s why we’re going to stop this now, take a breath and explore all of our avenues. What’s the rush?
[quote]I personally think putting this issue on a ballot is a costly exercise in futility. It will only add another $250,000 of cost to the project.[/quote]
Matt: your stated cost would be for a single issue special election. The council would be well advised not to spend precious taxpayer monies to do that. Instead they can place it on the June 2012 consolitated ballot which will bring costs way down, probably under 40K.
I am in the process of trying to figure out how much this entire water works + the new wastewater treatment plant would cost if it were competitively bid versus how much it is actually going to cost us. My initial read (not based on many hard facts yet or unbiased sources*) is that the bill will be somewhere between 125% and 150% greater, simply due to the fact that no competitive bids will be allowed.
Put another way, the state laws which prohibit competitive bidding on this kind of an infrastructure project will result in much higher bills for everyone in Davis from the wealthy down to the poor so that the labor unions which run and fund the Democratic Party in the state legislature can enrich themselves in all regards.
The principle law which outlaws competitive bidding is LABOR CODE SECTION 1770-1781 ([url]http://www.leginfo.ca.gov/cgi-bin/displaycode?section=lab&group=01001-02000&file=1770-1781[/url]), which requires any bidders on public construction projects to pay “prevailing wages” (which means union wages for all jobs) and to pay the same fringe benefits as unions pay.
[img]http://cdbpdx.com/MONOPOLY/MONOPOLY_1935-1936_Deed_WATERWORKS.JPG[/img]
More recently, the unions have gotten their mules in the Democratic Party to pass something called a Project Labor Agreement (PLA) law, which not only requires the wages and benefits to be union scale (even for those who are non-union), but it requires the work rules to be union work rules and it requires non-union and union companies to make pension payments and pay for post-retirement beneifits like lifetime medical care and convalescent care, even if the contractor does not offer such benefits. The end result of forcing PLA’s will be to increase the costs of all public works projects in California another 50 to 75%, according the the contractors’ association.
So to those who say [i]”this is the best time ever to start a construction project. We will save millions because so many construction workers are out of a job,”[/i] the truth is this is the worst time ever to start a project of this sort. That poor and lower-middle income people will find cities like Davis impossible to live in, because the unions (by way of the Democratic Party) are more than doubling the cost of our water works and our sewage treatment plant.
*My only substantive figures come from a biased source–Associated Builders and Contractors Golden Gate Chapter ([url]http://www.abcggc.org/[/url]). My hope is to find an academic who has no stake in the outcome of work laws and no strong bias leading him.
On Musser and Woodland’s situation, and her summary of it: First, I do not see the logic, as apparently Musser and Woodland City leaders do, in arguing that because the city of Woodland is being fined Woodland has the fiscal wherewithal to pay its share of the project. It might be an additional incentive for them to embark on the project but nothing else.
Musser reports that Woodland will “go it alone if they must.” Please explain to me how Woodland could possibly embark on this project alone!
“Woodland started a water advisory committee some time ago to keep costs down.” Please explain to us how this works, and maybe Davis could learn from Woodland.
“Woodland has plenty of public outreach.” Pleases detail what this so called public outreach entailed. Again perhaps Davis can learn from Woodland.
Woodland has “increased their water rates 20% the last 3 years and will do so again in the next year. But they will require another Prop 218 process to increase rates another 80% over the next 4 years.” And Musser and Woodland city leaders can assure Davis and Woodland voters that without a doubt that this will cover the project when there is vigorous debate as to the still unknown final costs of the project. Furthermore, maybe even some Woodland residents, who are implicitly portrayed as 100% behind the project, will start to ask questions when they find out their water bills will go up by a purported 80%.
“The [Woodland] City Council has unanimously approved the surface water project as the least expensive alternative for both cities, provided the two cities partner together.” So what. Or put another way, are we supposed to take comfort from this?
To Herman: Why don’t you attend a JPA meeting, and ask your questions directly to the City of Woodland members. I am sure they would be happy to explain. I am also sure you can send questions directly via email to the City of Woodland City Council members, and get your questions asked right from your home.
Rifkin said at 12:12 pm : “I am in the process of trying to figure out how much this entire water works + the new wastewater treatment plant would cost if it were competitively bid versus how much it is actually going to cost us. My initial read (not based on many hard facts yet or unbiased sources*) is that the bill will be somewhere between 125% and 150% greater, simply due to the fact that no competitive bids will be allowed.”
MJH: If you use $320 m figure that seems to be the latest city number, and you accept Rich’s 125-150% larger figure, then the cost overruns would put the total cost of the project from $400 million to $480 million.
I know that Rich has put more time in the fiscal details than I have had a chance to do, so far, but Elaine and Don and Voter2012 and the rest of the gang who jumped on me for putting out a total cost of $500 million …. not too bad of a rough estimate based on skimming the documents, huh?
I think $500 million is too low, but that’s my “rounding in the city’s favor” number for now.
See ya’ll around the markets, and for those of you who want to vote on this fiscal and environmental mess, please sign the petition!
MIchael, Rich didn’t say the cost would be 125 – 150% higher than the projected cost. He said it is that much higher than it could be due to built-in labor costs. Nobody except you has said the cost will be $500 million. I continue to “jump on” you for that because you haven’t substantiated the number you put out.
Don is correct in regards to what I said. I need to emphasize that the numbers came from a highly biased source (ABC), and I am not sure how reliable it is, and the person I spoke with, who asked not to be quoted by name, answered by question as “a ballpark guess.” My hope is to try to see if some economist who studies this sort of thing can clarify the matter better.
But for argument’s sake, take the middle number of the estimate of $170 million for the Davis share of the water works ([url]http://cityofdavis.org/pw/water/prop218/faq.cfm#faq_4[/url]) and add to that $100 million more for the sewage treatment plant. You get a total estimated cost of $270 million for Davis ratepayers. (I don’t know where Mike’s $320 million figure comes from. It’s quite possible his number is right and what is on the City’s website is wrong.)
Let’s then assume that the combination of prevailing wage laws and a project labor agreement increases the total cost of the project by somewhere between 125% and 150%. In plainer English, that means the finished cost due to our anti-competition laws ends up being 225% to 250% of the competitive price.
If you divide $270 by 2.25, you get $120. That means that the union wages and the union work rules and so on are turning a $120 million project into a $270 million project.
If you divide $270 by 2.50, you get $108. That means that the union wages and the union work rules and so on are turning a $108 million project into a $270 million project.
So if the estimate by the American Building Contractors is in the ballpark, California’s prevailing wage laws plus a PLA will cost the ratepayers of Davis somewhere between $150 million and $162 million in added costs.
That is a good part of the reason our state is so f*%&ed up. These wage laws don’t help poor people–they hurt them. They do help the workers who get these jobs. But they don’t help any class of Californians. The union work rules make jobs which would take a few months last a few years. That hurts everyone who is not working on one of those job sites.
In this case, the added cost might cause lower income people–especially if the costs are passed on to renters; I don’t know if that will happen–to have to leave our community.
And yet our Democratic legislators could change these laws–if they cared more about ordinary people than they cared about pleasing the unions which fund their campaigns.
Prevailing wage laws date back to 1868 but the depression era Davis-Bacon Act really solidified them as a way to keep contractors from undercutting local workforces.
What Michael said on the previous post was “If you want to demand that you have a right to vote this $500 million dollar project (including expected cost overruns), come on down!”
He was referring specifically to the water project, not the combined projects. The Davis portion of the water project is estimated by the city at $160 – $180 million. Total cost to both cities is estimated at $325 million.
Total cost of both water and sewer projects for Davis is about $270 million.
Rich is saying that the costs could be significantly lower if it weren’t for the labor laws. That is an interesting hypothetical, but it has nothing to do with the inflated estimates that are being put forth by supporters of the referendum.
“In this case, the added cost might cause lower income people–especially if the costs are passed on to renters; I don’t know if that will happen–to have to leave our community.”
Water costs will not raise the cost of living in Davis as much as growth restrictions have. I know plenty of great people who have had to leave our community because they could not afford to live here due to growth restrictions increasing the marginal costs of living here. I have even been criticized for arguing that we should take steps to lower the cost of housing to make Davis more affordable. Why then, all of a sudden, are the anti-growth, anti-union and anti-tax people so concerned about the cost of living in Davis? Could it be that they are using the water rate increase to advance their own political agendas? Could it be that they benefitted from the previous economic forces that growth restrictions have driven but now they can’t pay, or don’t want to pay this additional cost that will hit their own pocketbooks?
Mr Toad
Point of clarification. Are you implying that the anti – growth, ant -union, and anti- tax people are the same group,or three separate groups that now happen to see their interests aligning around this issue? It seems to me that the issue of securing an adequate, safe, sustainable water supply transcends issues of whatever local political groups you may be postulating and which may or may not even exist as organized groups.
Rusty49
It does not appear to me that this is being done “in a rush”. It would appear that there have been many years of consideration and debate over these issues with decisions and strategies for payment being consistently deferred. I am encouraged that we currently have a CC that is recognizing the importance of addressing these issues now and taking responsibility for addressing, and yes, paying for securing our future needs rather than continuing to just pass it on.
As will Rogers said “I’m not part of any organized group, I’m a Democrat.
I was reflecting on the sentiments expressed by many including certain local past and present elected officials, who do, in fact, by definition, represent popular viewpoints.
Mr. Toad, I respect your perspective, and for the purposes of discussion ask the following two questions that I believe differentiate between the two issues.
1) If your premise on housing prices is correct, A) what specific steps would you propose to remedy the situation, and B) how would you define success?
2) If your premise on water/sewer prices is correct, A) what specific steps would you propose to remedy the situation, and B) how would you define success?
Those questions are open to anyone to answer, not just Mr. Toad.
@ Don Shor:[quote]What Michael said on the previous post was “If you want to demand that you have a right to vote this $500 million dollar project (including expected cost overruns), come on down!”
He was referring specifically to the water project, not the combined projects. The Davis portion of the water project is estimated by the city at $160 – $180 million. Total cost to both cities is estimated at $325 million.
Total cost of both water and sewer projects for Davis is about $270 million.[/quote]Don: Some electoral prognostication …
Michael’s agenda is to get people as many people as possible as pissed off as possible. This is not really about “let the people decide.” It’s more about the cynical manipulation of a grass roots rate payer revolt in order to attempt a political comeback. If the revolt gets significant traction (win or lose), he will announce that he is running for city council. In the meantime he is spreading the kind of inflammatory false rhetoric that you pointed out above, as well as providing strategic and legal advice (and possibly financial support) to the referendum.
To answer my own question 2).
The numbers provided Wednesday night were $155 million construction costs for the Water project and $100 million for the Wastewater Treatment project. Further, the debt service for the $100 million is already included in the current Sewer rates.
Since the date for Tertiary Treatment compliance is 2017, I would not begin construction of any Wastewater Treatment upgrades until (for the sake of discussion) the spring of 2016, which would allow almost 24 months to complete the construction by the end of 2017 and avoid any State-levied fines in 2018.
That means that the $100 million Debt Service components of the 2012, 2013, 2014 and 2015 Sewer fees would be able to go toward paying for the Debt Service of the first $100 million of the $155 million Water project costs. In effect that means that Davis residents would see very little Water rate increases in 2012, 2013, 2014 and 2015, even though substantial portions of the Water Project costs would be being paid off.
Bottom-line, this is a practical approach to make substantial progress toward what Sue Greenwald has been advocating . . . “stage the projects so that we are paying them off one at a time.”
Seems logical to me.
Matt, I hope you will email your suggestion directly to the councilmembers.
“Since the date for Tertiary Treatment compliance is 2017, I would not begin construction of any Wastewater Treatment upgrades until (for the sake of discussion) the spring of 2016, which would allow almost 24 months to complete the construction by the end of 2017 and avoid any State-levied fines in 2018.”
Matt: Seems logical to me as well. Question … Is there a possibility of getting regulatory relief on the 2017 waste water requirements based on our diligent efforts (i.e. significant progress on the surface water project) to clean up our effluent by improving the source of our water?
If this is a realistic possibility, then your point about rates and financing could be extended even further into the future.
On surface there are at least two possible drawbacks to Matt’s otherwise innovative plan.
The first, and I don’t know this for sure, is the fungibility of the funding mechanisms, I’m sure we can transfer money from sewer to surface water.
Second, is the issue addressed on wednesday and the different constituent parts addressed by wastewater versus water supply.
Voter2012 said . . .
[i]”Matt: Seems logical to me as well. Question … Is there a possibility of getting regulatory relief on the 2017 waste water requirements based on our diligent efforts (i.e. significant progress on the surface water project) to clean up our effluent by improving the source of our water?
If this is a realistic possibility, then your point about rates and financing could be extended even further into the future.”[/i]
I’ve learned not to make my posts too complex, so I purposely omitted any discussion of whether fines would be waived in the post-2017 timeframe, but it seems logical that if construction was underway with a “real” completion date, the SWRCB would more than likely be “understanding” when deciding whether (and what) fines should be levied.
Since Woodland is already paying fines, we should have a pretty good idea of how any projected fines would contribute to the overall system costs. In the end it is all about financial modeling.
[i]”On surface there are at least two possible drawbacks to Matt’s otherwise innovative plan.
The first, and I don’t know this for sure, is the fungibility of the funding mechanisms, I’m sure we can transfer money from sewer to surface water.
Second, is the issue addressed on wednesday and the different constituent parts addressed by wastewater versus water supply.”[/i]
Absolutely correct David; however, based on a discussion I recently had, there is a very good argument that converting to surface water directly and significantly improves our wastewater treatment. This will address both your fungibility question as well as possible sources of low interest financing.
As was noted on Wednesday, the deadline for the Tertiary treatment is 2017. Selenium has a deadline of 2015, but that will be achieved if the source water is converted to surface water from groundwater. As best as I can tell, the critical wastewater deadline is 2017.
WOW! Where have you been Matt? Innovative?! Down right prescient!
Seriously though, what a breath of fresh air in a debate atmosphere of repeated BS and politicking.
Without access to Project water, how does UCD propose to grow?!?
Steve, do you know where they get their water now?
[i]”Why then, all of a sudden, are the anti-growth, anti-union and anti-tax people so concerned about the cost of living in Davis?”[/i]
For the record, I am not anti-growth. I believe, as long as the developer of a major project pays for the external costs his project imposes on the community, growth is perfectly fine with me.
I am sure that syndicalists like Toad think I am anti-union. However, my position is neutral toward unions as unions. What I object to is the way unions make money for themselves by buying influence with elected officials (such as happens in Davis with the fire union and statewide with virtually all unions) and the way unions prohibit labor competition with all manor of legislation. When unions compete in a free market for labor, then I have no objection. However, the normal pattern for unions is pretty much the same pattern for monopolists–they use the violence of government power to keep out any competition.
As to anti-tax, I am no ideologue. We pay higher taxes in Davis compared to every city in our region. I favored the library tax. I favored the parks tax. I have never voted against a schools tax, even though I think the schools mismanage their money and don’t do the obvious thing by rewarding quality teachers. Yet I concede that if you compare my views on tax rates with those of the average Davis voter, I am probably on the right half of the spectrum. So if you are a lefty like Toad, then you might think I am anti-tax. If you are Rusty49 or Jeff Boone, you might think I am a liberal.
“[i]Without access to Project water, how does UCD propose to grow?!?[/i]”
The housing being built by UCD on the university’s farmland has a contract supply of water from Putah Creek (through the Bureau of Reclamation). Since they are converting farmland to housing there is likely ample water for UCD growth.
[i]”As was noted on Wednesday, the deadline for the Tertiary treatment is 2017. Selenium has a deadline of 2015, but that will be achieved if the source water is converted to surface water from groundwater. As best as I can tell, the critical wastewater deadline is 2017.” [/i]
What constituents does the 2017 wastewater discharge permit pertain to? If it is salinity, wouldn’t the surface water project provide water with lower mineral content (including salt)? Couldn’t the city of Davis implement a program similar to the city of Dixon to buy back water softeners that contribute significant salt loads to our wastewater? See: http://www.americanwaterintel.com/archive/2/4/general/california-steps-its-war-home-water-softeners.html
eastdavis, the slide presented by City Water department Staff showed 2017 as the deadline for providing “Tertiary Treatment” which in plain English means filtering the all the output from the current wastewater treatment plant (which provides secondary treatment). So (to the best of my knowledge) it isn’t a specific constituent issue, but rather a whole additional filtering process issue.
The slide also listed 2015 as an additional deadline for reducing Selenium, which comes from our current groundwater supply. Virtually none of the Selenium comes from any water softener salinity. So our alternatives there are 1) change our water source, or 2) provide appropriate removal of Selenium at each of our 20+ wellheads, with the added cost of disposing of the Selenium “brine” created at each wellhead, or 3) provide Selenium-specific capability to the current Wastewater Treatment Plant. Option 1) has a one-time cost and no ongoing costs. Options 2) and 3) appear to both have a one-time cost and significant annual ongoing costs.
Here’s a summary of the key points re: UCD as I currently understand the situation –
(1) UCD has rights to surface water from Solano County which they will use to supplement their deep aquifer water and come into regulatory compliance.
(2) Their system will produce a surplus that will be sold to the City of Davis for ten years.
(3) Their rights to the deep aquifer take precedence over the rights of the City of Davis.
(4) If we overdraft and/or degrade the deep aquifer they can stop us in court, particularly if our activities start to negatively impact their effluent.
(5) They don’t need us — the Davis/Woodland project is not necessary to support their growth.
“(3) Their rights to the deep aquifer take precedence over the rights of the City of Davis. “
My understanding is that groundwater extraction is not regulated the way surface water is . Davis and UCD have equal “rights” to extract water from deep aquifers.
davisite, how quickly does the deep aquifer recharge itself?
davisite2: I believe your understanding is incorrect. Extraction of water for resale is subordinate to use by landowners.
I posted the citation for this a few articles back.
If the city starts to overdraft the aquifer, UCD can stop us in court. There is reportedly already some tension on this issue between the city and the university.
“davisite, how quickly does the deep aquifer recharge itself?”
Matt… a good question for which the answer would be very important in this discussion. It has always struck me strange that apparently there has been no effort to find the answer to your question by the city and Council, instead we are offered vague nighmare scenerios and no numbers based upon on-the -ground investigations and extrapolations from other studies of deep aquifers.
“Extraction of water for resale is subordinate to use by landowners.”
I doubt that the City of Davis would be cited for reselling water from its deep aquifers if it was a part of the city water supply system. As to “overdrafting” the aquifer, this would be very difficult to argue if no clear data is gathered as to the quantity and recharge rate of the aquifer. This is why groundwater is not regulated like surface water sources.
[quote]That means that the $100 million Debt Service components of the 2012, 2013, 2014 and 2015 Sewer fees would be able to go toward paying for the Debt Service of the first $100 million of the $155 million Water project costs. In effect that means that Davis residents would see very little Water rate increases in 2012, 2013, 2014 and 2015, even though substantial portions of the Water Project costs would be being paid off. [/quote]
It is my understanding this is a portion of the methodology of how the Dept. of Public Works was able to reduce the water rate increases from 3.2 times the current rate, to only 2 times the current rate. Part of the already collected revenues from the Wastewater Treament side will be used to help fund the surface water project, to bring the projected Prop 218 five year rates down to a more manageable level to “phase in” the financing as you put it… Someone from our surface water advisory group can jump in if I have this wrong…
“Because the deep aquifer has been found only under the southeastern portion of the County (i.e. in the vicinity of Davis), and has limited or no natural recharge (Scott, 1990), it is not considered as significant or reliable a supply source for the County as the main aquifer or other surface supplies (though it is used by the University of California, Davis and may become important for the city of Davis).”
An excellent resource on Yolo County water supply: [url]http://www.dcn.davis.ca.us/dcn/projects/conjunctiveuse/index.html[/url]
Elaine, while that may be true, the current plan has a timeline where both projects spend money virtually immediately. If some of that spending is deferred 4-5 years until 2016, then the cash needs (and the interest paid on the cash received from the lending sources) will be reduced, but the revenue streams realized from the sewer fees will stay the same regardless of how much cash is actively borrowed. Constant inflows and reduced outflows will mean a surplus which can be used to pay off the costs of the surface water project.
Bottom-line it means an even slower phase-in than what is currently being planned . . . and therefore reduced burden on individual rate payers.
Its a weird coalition Rich. I think of you as anti-union because of your many posts to this effect.
Matt, it is hard to argue for growth now because the housing market is weak so playing catch up with supply puts more people under water because so many have over paid over the last generation of supply restrictions. Although personally I am in favor of additional supply to make Davis more affordable for those who want to live here.
Anyway my point was about how those who have never seemed concerned about what their policies have done to the cost of living in Davis now want to use water rates as if they are concerned about the less fortunate. In reality they don’t want the surface water because it will support growth. That is the consistent position throughout. The complaint about cost is for the anti-growth people just another issue to raise. As John Steinbeck wrote in his novel In Dubious Battle “A good organizer uses whatever he has.”
I realize it is hard to argue for growth in the current economy, but setting that immediate reality aside, what do you see as the ideal price, bedrooms and square feet of the kinds of houses that would make Davis more affordable?
Matt: more market-rate apartments, more duplexes, even more trailer parks. There is not presently a need for high-end single-family houses and condominiums. A complete revision of current Davis housing policy is in order.
[quote]Matt: Seems logical to me as well. Question … Is there a possibility of getting regulatory relief on the 2017 waste water requirements based on our diligent efforts (i.e. significant progress on the surface water project) to clean up our effluent by improving the source of our water?–[b]Voter2012[/b][/quote]Let me explain a few things here. The surface water addresses different constituents than does the wastewater treatment plant. The surface water project addresses the salinity issue (we can deal with selenium without it). It doesn’t address the other problematic constituents in the effluent.
Unfortunately, we are going to have to proceed with the wastewater treatment plant. Of course I would have preferred to delay the wastewater treatment plant,but we can’t.
To summarize: Progress on surface does not have any relationship to our need for a new wastewater treatment plant.
The reason that we have a chance to postpone completion of the surface water project is that salinity requirements are the ones that are being reviewed, probably revised, and for which there is a ten year interim variance that will be potentially available.
Again: Only the surface water project has potential to be eligible for postponement.
Sue, what you are saying doesn’t compute. In round numbers you are saying that the construction timeline of the Wastewater Plant project will be all of 2012, all of 2013, all of 2014, all of 2015, all of 2016, and some portion of 2017. That is 5-6 years of construction. How can that possibly be the case? Can you please explain that to us . . . or give us an accurate timeline.
[quote]Elaine, while that may be true, the current plan has a timeline where both projects spend money virtually immediately. If some of that spending is deferred 4-5 years until 2016, then the cash needs (and the interest paid on the cash received from the lending sources) will be reduced, but the revenue streams realized from the sewer fees will stay the same regardless of how much cash is actively borrowed. Constant inflows and reduced outflows will mean a surplus which can be used to pay off the costs of the surface water project. [/quote]
Matt, I have to admit finance is not my area of expertise, but here I go, off the edge into the deep end of the water(pardon the pun!). It is my understanding that in order to pay for the costs that will be needed to begin the surface water project and to obtain the necessary financing (that is where the sticky wicket is I believe), the city has to do it the way they are doing it, if that makes any sense. But if you really feel strongly that you have an idea that would work to bring rates down, please contact the Dept. of Public Works, and they will be able to explain things better than I. They are extremely receptive, and patient. Then you can get back to us, and let us know what they said. I would certainly be curious.
[i]”Matt: more market-rate apartments, more duplexes, even more trailer parks. There is not presently a need for high-end single-family houses and condominiums. A complete revision of current Davis housing policy is in order.”[/i]
Don, I think you know that I agree with you.
[quote]…salinity requirements are the ones that are being reviewed…
…probably revised…
…and for which…a ten year interim variance…will be potentially available. [/quote]
“Being reviewed” does not equate to the salinity standard “being relaxed”.
“Probably revised” does not equate to “revised the way I want”.
“Potentially available” does not equate to “will be available” or even “maybe available”.
What you have is a lot of wishful thinking…
Matt,
Depends on the cost of construction too, plus a reasonable return. Of course land prices would go down if you built more and let us not forget water hook ups.
As for how to reduce costs for water; sell treated wastewater, sell hook ups at the value added cost of development, squeeze down construction costs as Dan Wolk explained, not by union busting of course, finance now long term while the fed is acting to lower long term rates. More residents means more rate payers means lower rates. Resell any excess water rights until they are needed. Something everyone seems to be missing is that the water itself is more valuable than when it adds value.
[i]”Matt, if you really feel strongly that you have an idea that would work to bring rates down, please contact the Dept. of Public Works, and they will be able to explain things better than I. They are extremely receptive, and patient. Then you can get back to us, and let us know what they said. I would certainly be curious.”[/i]
I have Elaine, and I will continue to do so. I will keep you posted on any progress.
“As for how to reduce costs for water; sell treated wastewater, sell hook ups at the value added cost of development, squeeze down construction costs as Dan Wolk explained, not by union busting of course, finance now long term while the fed is acting to lower long term rates. More residents means more rate payers means lower rates. Resell any excess water rights until they are needed. Something everyone seems to be missing is that the water itself is more valuable than when it adds value.”
With all due respect Mr. Toad, water costs are absolutely trivial when a young couple sits down looking to purchase their first home (or move to Davis from a home in another location). So lets concentrate on the housing cost. And I reask my questions from above . . .
[i]What do you see as the ideal price, bedrooms and square footage of the kinds of residences that would make Davis more affordable?[/i]
Also since he has brought it up, do you agree with Don that 1) market-rate apartments, duplexes, and even trailer parks will be attractive to the address the housing desires of “those who want to live here,” and 2) that there is not presently a need for high-end single-family houses and condominiums?
Voter2012: I doubt the University would sue us over the deep water aquifer if made the case that we were moving to surface water within a 20 year period.
But if they did, it would end up in a long drawn out court case that would probably end up in a compromise agreement.
Ground water rights are not as well defined as you make them out to be.
[b]Rich Rifkin: [/b] The real cost of the project: When looking at the cost of our share of the project, I taken current staff estimated cost of $150 million and add to it the present value of the Conaway water purchase of $36,000 and the bew $8 million East Area water tank, which is part of the capital needs. This brings us to $194 million. I have been sticking with this number for initial estimates (around $200 million). So our wastewater/surface water projects are currently estimated to be around $300 million total.
But remember, the project cost currently assumes that that we will only pay $12 million for the intake. If Tsakopoulas doesn’t receive federal funding that enables us to proceed, we will need to come up with another $10 million or so.
Then of course we come to your questions about change orders, unanticipated expenses, etc.
@davisite2: “[u]I doubt[/u] that the City of Davis would …”
@Sue Greenwald: “[u]I doubt[/u] the University would …”
I doubt that either of you bothered to read the citation I posted.
Sue Greenwald said . . .
[i]”Let me explain a few things here. The surface water addresses different constituents than does the wastewater treatment plant. The surface water project addresses the salinity issue (we can deal with selenium without it). It doesn’t address the other problematic constituents in the effluent.
Unfortunately, we are going to have to proceed with the wastewater treatment plant. Of course I would have preferred to delay the wastewater treatment plant, but we can’t.
To summarize: Progress on surface does not have any relationship to our need for a new wastewater treatment plant.
The reason that we have a chance to postpone completion of the surface water project is that salinity requirements are the ones that are being reviewed, probably revised, and for which there is a ten year interim variance that will be potentially available.
Again: Only the surface water project has potential to be eligible for postponement.”[/i]
Sue, what you are saying doesn’t compute. In round numbers you are saying that the construction timeline of the Wastewater Plant project will be all of 2012, all of 2013, all of 2014, all of 2015, all of 2016, and some portion of 2017. That is 5-6 years of construction. How can that possibly be the case? Can you please explain that to us . . . or give us an accurate timeline.
[quote]”Being reviewed” does not equate to the salinity standard “being relaxed”.
“Probably revised” does not equate to “revised the way I want”.
“Potentially available” does not equate to “will be available” or even “maybe available”. What you have is a lot of wishful thinking…[b]–E. Roberts Musser[/b][/quote]No Elaine, I had a long talk with with the SWRCB about this, and it was confirmed by our city water attorney. There are no guaranteed outcomes, but the revision process was established and salnity standards are being reviewed and socio-economic impacts will be considered as the judge in the Tracy decision suggested and as Porter-Cologne mandates —Geeeesh.
MW: “With all due respect Mr. Toad, water costs are absolutely trivial when a young couple sits down looking to purchase their first home (or move to Davis from a home in another location).”
My point exactly Matt. So why raise affordability now after years of supporting policies that make Davis unaffordable?
As to your question it seems we have too spent many years building high end housing. I have no problem building other types of housing. As for what the best mix is I don’t know. What I do know is that the more you build the cheaper it gets especially in a weak market. Eventually increasing supply diminishes price to where it is not profitable to build. So I guess my answer is let the market decide but I would also come up with a water hook up fee that both defines for developers the cost of subdivision while providing clarity and opportunity for them to move forward with their projects.
[quote]There are no guaranteed outcomes,[/quote]
I rest my case…
[quote]There are no guaranteed outcomes,[/quote]
I rest my case…
[quote]I have Elaine, and I will continue to do so. I will keep you posted on any progress.[/quote]
Excellent. And please keep me posted…
[quote]I have Elaine, and I will continue to do so. I will keep you posted on any progress.[/quote]
Excellent. And please keep me posted…
[quote]Voter2012: I doubt the University would sue us over the deep water aquifer if made the case that we were moving to surface water within a 20 year period. [/quote]
20 year variance? Let’s see, you have given the your preferred figures to delay the surface water project as 10, 15, 20, 25, 30. As far as I am aware the SWRCB can only give 10 year variances at most, assuming your could even prove “economic infeasibility”, which you still have as yet to explain…
[quote]Voter2012: I doubt the University would sue us over the deep water aquifer if made the case that we were moving to surface water within a 20 year period. [/quote]
20 year variance? Let’s see, you have given the your preferred figures to delay the surface water project as 10, 15, 20, 25, 30. As far as I am aware the SWRCB can only give 10 year variances at most, assuming your could even prove “economic infeasibility”, which you still have as yet to explain…
Correction: assuming you could…
Correction: assuming you could…