Major initiative to be on June, 2014 Ballot
By Marge Ann Jameson
Public Water Now, the local grass-roots organization established in early 2013 to create public ownership of the Monterey Peninsula water system, has announced that it has surpassed the number of valid signatures required to put its public ownership initiative on the June 2014 ballot.
Managing Director Ron Cohen said that the 5,600 signatures required “was accomplished in just 12 weeks and has since grown, reaching a total of more than 8,300 signatures which are being turned over to the Monterey Peninsula Water Management District office here today for official registration.
“We are thrilled to see the widespread interest in the community for an improvement in how our limited, yet vital water resources are managed,” he said. “We are especially proud that every signature was collected by one of our 150 dedicated Public Water Now volunteers. No paid helpers were used or needed.”
Speaking at the Dec. 18, 2013 Pacific Grove City Council meeting, in response to a question by Councilmember Ken Cuneo about how public ownership of the water utility might change the rate situation, Dave Stoldt of the Water Management District gave a neutral response.
“We are agnostic on the issue,” he said, meaning the MPWMD has not taken a position on the matter.
He pointed out that it will be a long process.
He said that the MPWMD will “do what we have to do.”
If the measure passes in June, 2014, the MPWMD will enter into a study about feasibility, and if the study indicates that public ownership of the water utility with MPWMD managing it is a “good idea,” the MPWMD would then go back to the cities involved and gather opinions and suggestions. He estimates that process could take as long as a year.
The next step, said Stoldt, is to go to Cal-Am and ask them to sell, and he doesn’t believe they would say “yes” right offhand. The step after that would be an eminent domain process, whereby the MPWMD would, on behalf of the ratepayers, ask the courts to force the sale in the public interest. “That could take as many as three to five years,” he said.
It didn’t take that long in Santa Cruz County, where locals took Cal-Am to court in am eminent domain action.
In Felton, in the San Lorenzo Valley of Santa Cruz County, Cal-Am acquired a private water utility called Citizens Utilities, which serviced the more than 5,000 residents of Felton. Rates increased and ratepayers were expressing increasing concerns about private water. A committee which called itself FLOW – Friends of Locally Owned Water – was formed and eventually was able to get a measure on the ballot in 2005. It passed with about 74.8 percent of the vote.
The measure provided for approximately $11 million in acquisition transaction costs and acquisition costs.
In 2006, the District made a formal offer of $7.6 million, which was refused by Cal-Am. In 2007, the SLVWD Board approved resolution of necessity and filed an action of eminent domain in Santa Cruz Superior Court. A judge ruled on the “right to take” portion of the question and the valuation portion was set for jury trial, but Cal-Am waived its defense on the right-to-take portion and, in mediation, reached a settlement of $10.5 million in cash plus assumption of a loan outstanding under the Safe Drinking Water Bond Act, owed by citizens and Cal-Am. The total was $13.4 million.
SLVWD paid the $1 million in acquisition transaction costs itself. The ratepayers and property owners are responsible for the balance. It is being repaid by a special tax of $535 per year per water meter over the next 30 years. (Some property owners in Felton do not have water maters as they receive water from private wells.) But SLVWD Manager Jim Mueller testified at a February, 2011 water forum that ratepayer are also saving $535 per year on their water bills in the form of lower rates, so it would appear to be a wash.
Questions remain about the deteriorated condition of Cal-Am’s infrastructure, which the District was not allowed to inspect before completing the purchase, according to SLVWD General Manager Jim Mueller, who testified at a water forum in Monterey in 2011.
Monterey Councilmember Frank Sollecito asked at the forum about hindsight. “If I was to go knock on doors in the district now, would I get a favorable reaction to what occurred? Are they still happy or would I get complaints?”
“I would say that you would get an overwhelmingly favorable reaction from both the residents of Felton and the existing customers of San Lorenzo Valley Water District,” answered Mueller.