That more money is going out than coming in is a problem also brought up when this matter is discussed, and if additional funds are not raised then the city's water enterprise would have to go out of business and sold to a private operation. Cities who have been through that experience do not recommend our doing that.
Others will tell you that these water rate increases are a part of an overall City Hall fund raising scheme designed to cover increased employee pensions and benefits. An opinion that has become so prevalent in town that the City felt the need to issue the following denial on its Facebook page. This from a November 7 post there:
City water and sewer rates are not being increased so that employee salaries can be increased to “market” rates. Nor are the rates being increased to enhance employee benefits. Funding has not been included in the draft water and sewer rate study for any additional, new staffing. Additionally, water revenues cannot be used to pay for the salaries of non-water related staffing, and sewer revenues cannot be used to pay for the salaries of non-sewer related staffing.
But who knows? What is said in a "draft water and sewer rate study" and what ends up being officially approved city policy could be two very different things. This is a matter that is also somewhat contradicted on that same Facebook page in a list of possible consequences should water rates not go up.
Reduction in staffing and other cost savings measures will result in reduced customer service. Reduced customer service means slower response to water leaks, water main breaks, and customer requests.
I guess this means that current water department employee salaries would need to continue to be paid or we would face reduced customer service. Just don't expect those salaries to go up anytime soon. Which is not the best news if you happen to work there.
However, according to an August 2nd article in the Pasadena Star News, Mayor Nancy Walsh believes that the most pressing matters are water bond covenants and credit ratings. Here is how she revealed that in a piece called "Sierra Madre expects to raise water rates once again" (link):
Mayor Nancy Walsh said Wednesday that residents can expect future water-rate increases to offset the city’s low credit rating.
Though a current study determining the effects of water rates is still under review, “no doubt there will be an increase” again, she said.
“We need to make sure we’re good on our bond covenant,” the mayor said.
When the rates were discussed in 2010, Walsh was a council member and advocated an initial rate increase of 15 percent, followed by 3 percent increases the next four years.
That proposal angered residents and the council ultimately approved 7.5 percent, Walsh said.
“I did not support the rate that was proposed, but I was outvoted,” she said of the 7.5 percent increase. “In the end, I had to vote for it. Any money helped.”
“Shortly after, our credit was downgraded,” Walsh said. “This is really talking about our credit. It’s our No. 1 priority.”
The (previous) increases started on July 1, 2011, and run through fiscal year of 2015. Each fiscal year, water rates have increased 7.5 percent, except for the final fiscal year, where rates only will increase 7.2 percent.
“From a public works perspective, those increases were not adequate to cover ongoing costs,” Inman said. The increases have been “inadequate” to maintain and produce water systems and distribute water to city customers, and rate increases would help resolve that issue., Inman said.
“The amount of money that is set aside for future capital improvement projects directly affect the rates,” Aguilar said.
Reports from this year show an approximate $492,000 deficit. “We keep deferring maintenance because we can’t afford to get work done,” Inman said.
Hopefully the reasons for this water rate increase will all get figured out before we get too much farther down the line.
Do Condo Owners Get A Prop 218 ballot?
If you don't want a water rate hike, and you find all of the arguments being presented by City Hall to be unconvincing, you would most likely want to fill out a Prop 218 protest ballot and send it in to whoever is keeping track of such things. And if enough people agree with you and do the same, then the City will not be able to raise your water rates.
Who actually receives these ballots from the City? Those whose names are listed on the City's water bills. Per state law only actual water ratepayers are able to cast a Prop 218 protest vote against a water rate increase, and only they are to receive ballots.
But according to an aggrieved resident who called in yesterday, if you own a condominium here in town, chances are you won't receive a Prop 218 ballot whether you are a ratepayer or not. According to this person ballots will only be sent to the "Homeowners Association," who will then cast just that one single ballot on behalf of all the condominium owners in whatever complex they represent.
This no matter how many water ratepayers might live in that complex. Something that appears will disenfranchise a whole lot of water ratepayers.
Hardly seems fair.