The League of Women Voters sponsored a debate on two issues that will be on the ballot next month – Measure O (Sales Tax) and Measure P (water rates). With all due respect to Councilmember Lucas Frerichs, the Measure O debate was turned into a travesty by Jose Granda. We will have more on that tomorrow.
But the Measure P portion of the debate featured an intriguing match-up of Sue Greenwald, the three-time Davis city councilmember and onetime mayor, and Matt Williams, who served on the WAC and who, along with Frank Loge, designed the CBFR (consumption-based fixed-rate water rates).
Sue Greenwald, in her ten-minute comment, stated that Sacramento State Economics Professor Mark Siegler did the fiscal analysis for the Measure P campaign. “What we found is that homeowners and tenants of single family homes will still be paying almost 40 percent more for each gallon of water than other residential users under the new water rate structure and much more than commercial as well.”
“Not only is this unfair, it’s going to ultimately result in higher costs for most rates,” she continued. “It will lead to some adverse, unintended consequences.”
“We all agree if you use twice as much water, you should pay twice as much. But not almost three times as much or more. Yet that’s what single-family homes will be paying under the new water rate structure,” she stated. “Voting yes on Measure P will repeal this water rate structure and send a very strong message to council to implement a rate structure that is fair to all.”
She again reiterated that residents of single family homes will pay 40 percent more per gallon than other residential users for two reason. First, the reliance on the summer peak month use to determine two thirds of the bill for the year. The other she said, “is using a meter size and the way they’ve done it to determine a portion of this bill.”
“Fair rates become increasingly important as our water rates escalate,” she said. “The cost of the new wastewater and surface water treatment plants will result in our municipal utility bills being among the highest statewide. I know because I’ve called the state regions and talked to their long range forecasters.”
Sue Greenwald said that Mayor Joe Krovoza has argued that this rate structure is fair “because they say that the cost of the surface water project is dictated by what they call peak use, which they define as summer use.” She added that Matt Williams stated that peak time demand is more important than time of year. “He said that, I have it on tape,” she offered.
“They argue that it’s fair to charge one household less per gallon than its neighbor, year round,” she continued. “If that household has a vacation home and can afford extended summer vacations, then they could use just as much water year round and the neighbor that can afford a summer home and a long vacation will pay less because of the peak summer structure.”
“The peak use argument is completely false to begin with,” she continued. “The city claimed that the peak use pays for the fixed costs, which is mostly the water project. That’s like 80 percent of our bill. The city claimed we needed the surface water project for reasons that have nothing at all to do with peak use such as securing river water rights, improving water quality, complying with new selenium standards – we would use this whether there was peak use…”
She argued that we could have met these needs without the project, “I can document that, I have a report that says so.” She argued that what she keeps hearing is that the size of the treatment plant is determined by peak use. “We’ve already heard from the staff that decreasing the size of the treatment plant further won’t have any noticeable impact on our water bills.”
“So there really is no justification for shifting the costs of this massive project disproportionate to any users in this case that happen to be single families,” she argued.
“The city council has made the incorrect claim that two-thirds of the people will be paying less under this new system,” Sue Greenwald continued. “It’s not true. It relies on the false claim that the big summer irrigators (the city and school district) will pay massively more. But they’re opting out.”
“Matt argues that that’s been taken into account already and I will prove in my rebuttal that it absolutely will not as all,” she said. “So most people will be paying more when this occurs.”
She noted that in her belief the city has assumed future growth and that new subdivisions will be paying the same rate. She argues that because of the costs of water, those new subdivisions will be opting out and digging their own wells.
“By using the summer rate system, the city is basically forcing out our largest rate payers, our best customers,” she said. “The unintended consequences is that the council has claimed that its environmentally preferable for large irrigators to opt out and kick the costs back to the remaining taxpayers because the new mantra is potable water should not be used for irrigation.”
“Finally there’s going to be no dire consequences for the passage of Measure P as claimed by council and staff,” she said. “These are the usual scare tactics… “
Sue Greenwald rebuttal
Matt Williams rebuttal
Note: we will have the comments by Matt Williams posted shortly
You do realize both videos posted thus far are “all about Sue”, right?
Had forgotten about the long speeches, with all the “um’s”, “ahs”, gesticulations, etc.
Her usual Terpsichorean performance, imo, complete with unsubstantiated claims, hopeful financial scenarios and scapegoating, a little rusty perhaps, but she looks marvelous.
;>)/
Thank you for the vocabulary word for the day. Forced me to look it up, and I learned something.
typical sue. hope you can get the rest posted, want to see more of how matt williams takes her down.
This makes 3 votes for measure P in our household
And, 4 against it, in ours.
and, what does “shortly” mean? June 1?
The rates punish people who use mid-year summer water, by 40%. Fact.
The rates punish people who may use a bit more water in the summer, for many months afterward. Fact.
I’d like to see everyone pay the same per ccf unit of water. And bill monthly, so I can adjust my water consumption down if I get an unpleastant bill. (Like PGE).
When the repeal is granted by the voters, we need John Munn up on the CC to ensure that the voices of the ratepayers are heard when the new rates are calculated.
Fair rates, fair process.
I know that the state is requiring every urban water district to adopt plans that reduce water consumption by 20% by 2020. They have to describe to the state how they plan to achieve that target. One of the simplest ways that a city can demonstrate a conservation strategy is to show that they use tiered rates; i.e., the amount charged increases as consumption increases above certain baseline amounts. So I don’t even pretend to be an expert on this aspect, but it may not be possible to charge ‘the same per ccf unit of water’ and be in compliance with these regulations.
Here’s an older article about it: http://www.westerncity.com/Western-City/July-2010/Understanding-the-New-Water-Conservation-Mandates/
wouldn’t that end up meaning that the low end users subsidize the high end users since the city has to build for capacity. how do you design the fixed component in such away that the ccf is the same?
That is correct DP. Mike is arguing for a “1% Solution” the converse of “We are the 99%”
Over the four CBFR years of the rate structure Mike’s proposed solution would put over $530,000 into the pockets of Davis’ 1% at the expense of the 99%.
In addition, over the four CBFR years of the rate structure Mike’s proposed solution would take over $2 million out of the pockets of Davis’ 26,000 apartment renters and give that $2 million to the parks and schools. According to the BAE reports given to the Housing Element Steering Committee, 16,000 of the apartment renters are students and 10,000 of the apartment renters are non-student families. Mikes plan would be giving the 40,000 single family home residents a free pass on their fair share of that $2 million subsidy to the parks and schools.
Said another way, the people who can best afford to pay (all homeowners, and especially the 1%) get a free pass while the people who can least afford to pay (apartment renters) shoulder the burden.
“The rates punish people who use mid-year summer water, by 40%.
Fact.“ Fantasy.Based on the annual water consumption volumes that are in (A) the Bartle Wells Cost of Service Study, (B) the documented record of the proceedings of the Water Advisory Committee, (C) the water billing history of the City of Davis, and (D) the Administrative Record portion of the State of California Superior Court, County of Yolo case CV-13-877 Yolo Ratepayers et. al. vs. City of Davis, the proportion of water used by City of Davis Single Family Residences in the six summer months is 51.0% of the total system consumption in the summer (all four Classes combined). The proportion of water used by City of Davis Single Family Residences in all twelve annual months is 50.7% of the total system consumption in the summer. That amounts to a one half of one percent “punishment” which is 75-times smaller than 40%. The monthly rounding of the monthly consumption by the meters and billing system is greater than one half of one percent.
“The rates punish people who may use a bit more water in the summer, for many months afterward.
Fact.“ Fantasy.As noted in the graphic below, the rates simply separate the volumetric charges into two components, billing the first 23% of the volumetric charges in the current period and billing the remaining 77% in twelve equal payments that amount to approximately 6.4% of the total. In exchange for fiscal stability for the water system as a whole, the rate system is simply financing 77% of the volumetric charges of each rate payer at a 0% interest rate payable with a “financing period” of 12 months. The math works as follows … (23 + 6.4 + 6.4 + 6.4 + 6.4 + 6.4 + 6.4 + 6.4 + 6.4 + 6.4 + 6.4 + 6.4 + 6.4) = 100.
“I’d like to see everyone pay the same per ccf unit of water. And bill monthly, so I can adjust my water consumption down if I get an unpleastant bill. (Like PGE).”
First, let’s start with the end of that statement. Many PG&E customers choose the “budget billing” option which makes monthly budgeting and cash flow much easier to manage. That argument is correct as far as it goes. However, there are three key components you forsake in exchange for that adjustment ability … (1) you forsake the 12-month zero percent financing of 77% of your total volumetric charges, (2) you expose each ratepayer to “structural deficit risk” because 67% of the system Revenue is converted from Fixed Revenue to variable Revenue. In one year alone, a water district near Palm Springs went from a $2 million per year surplus to a $5 million per year deficit due to the impact of conservation on Revenues. Spreading $7 million equally ofer the 16,433 accounts in Davis would mean that each account would see an average $425 per year price increase from the emergency rate increase that the structural deficit would necessitate. Under Davis’ approved rates that 67% Fixed Revenue stays Fixed and the risk of a Structural Deficit of $7 million in one year evaporates.
“Fair rates, fair process”
That is precisely and exactly what we have now. Vote “No” on Measure P
Your argument reminds me that classical little book, “How to Lie With Statistics.” Sorry, but you are not close to being persuasive. I’m voting YES on Measure P and I expect most of my colleagues will do the same (being the logical and fair-minded citizens they are).
Democracy is all about every person getting to have a say. I respect your right to disagree.
The numbers are what the numbers are, and they are in the public record for all to see. They speak for themselves.
Annual use Total for all four Classes = 4,549,938 ccf
Annual Use for City of Davis Single Family Residential = 2,307,114 ccf
Annual Use as a percent of Total for City of Davis Single Family Residential = 50.7%
6-month use Total for all four Classes = 3,055,110 ccf
6-month Use for City of Davis Single Family Residential = 1,557,358 ccf
6-month Use as a percent of Total for City of Davis Single Family Residential = 51.0%
Yes, we do agree on the very positive circumstance that enables us to disagree in peace and with respect.
So, do the numbers state that since some other town goes from a $2 million surplus to a $5 million loss that Davis must necessarily experience a $7 million deficit for water unless we agree to what the politicians have proposed??
In addition, you laud the benefits of zero interest financing on what essentially amounts to a tax that should never have imposed in the first place. Therefore, the numbers say, “Vote YES on Measure P.”
Fair enough Creek Path Builder.
With that said, what I hear you arguing for in your second and third paragraph above is “kill this unnecessary project” and that if the project went/goes away then any discussion of a rate structure is moot. Am I hearing that correctly?
Not necessarily. I’m not convinced that the project needs to cost as much as it is projected to cost or that the problem(s) being addressed has/have been clearly and objectively described. But, I’m open minded about the possibility that some type of project would be a good thing.
A problem is that projects like this are fraught with potential for boondogglesque waste. Building a complex rate structure on top of that, especially one that lies quite heavily on the backs of single-family home dwellers adds to my lack of comfort in the whole thing.
Rationing by government-led price fixing seldom works, and that seems to be the objective here, more than efficiently meeting the needs of the City.