Posts

Proposition 218 Is The Fastest Way To Raise Money, But Is It Right?

 

“I have never understood why it is ‘greed’ to want to keep the money you’ve earned, but not greed to want to take somebody else’s money.”

—Thomas Jefferson

Proposition 218

Ventura Water will push the boundaries of the law as it tries to use Proposition 218 to raise money to meet the Wishtoya Foundation Consent Decree.

In the next 12 months, Ventura Water will ask the City Council to increase water rates for 30 wastewater projects and 28 water projects by 2024. These costly projects will benefit some property owners. Other projects will help the community at large.

As of June 30, 2018, Ventura Water accumulated $115,000,000 for projects they planned to build between 2012-2018. Still, they need $449,586,000 more before 2024. How did we commit to spending almost $450 million, and why weren’t you asked to vote on it?

WHAT WILL THIS COST YOU?

These new rate increases will come on top of the increases imposed over the last six years. In 2012, Ventura Water wanted to increase rates to:

  1. Replacing aging pipelines and facilities
  2. Building projects to improve water quality
  3. Constructing new groundwater wells

In 2012 the average homeowner and family of 4, received a bi-monthly bill of $73.27 and sewer charges of $72.45 for a total of $145.72. That same family is paying $105.03 for water in 2018.  Add sewer charges of $104.64 and their total bill is $209.67.  This is a 43% increase over the 2012 rates.

From 2018-2024, expect a similar rate of growth. Your new water bill may look like this:Proposition 218

HOW DID WE GET INTO THIS SITUATION?

Propoosition 218In March 2012, the Ventura City Council signed a Consent Decree that requires Ventura Water to stop putting 100% of its treated wastewater into the Santa Clara River estuary by January 2025. The decree stems from a Federal complaint filed by Wishtoya Foundation. Former City Manager, Rick Cole and Ventura Water General Manager, Shana Epstein, signed the consent decree on behalf of the city. The city no longer employs either of them.

Keep in mind that voters had no voice in the City Council consenting to the decree in 2012. Now, Ventura Water wants to deny voters the chance to say how we spend the money to meet the order, too. It plans to use Proposition 218 to get those funds.

HOW AND WHY CAN VENTURA INCREASE MY RATES?

So how can Ventura Water impose such large fees against its citizens without the traditional right to vote on such matters? The answer lies in how Ventura implements Proposition 218. Approved by the voters in 1996, Proposition 218 allows Ventura to raise money in one of three ways:

  1. General taxes. Those taxes used for general governmental purposes. Prop 218 requires the traditional voting procedure, notice, a ballot and an election measure. 51% of the voters must approve it. Ventura’s Measure O sales tax was one such example.
  2. Special Taxes. Any tax imposed for specific purposes and placed in a general fund. A Special Tax requires a 2/3 (66.67%) majority vote. The City sought this type of tax in 2009. It was Measure A on the ballot. It was a 1/2 cent sales tax for public safety and other specific projects. Monies would have been placed in the city’s General Fund. It failed.
  3. Special Assessments, Fees and Charges. Fees or charges means an assessment imposed as an incident of owning property which receives a unique benefit. The city can only impose such fees by affirmative voter approval. The exception being that prior voter approval is not required for “any assessment imposed exclusively to finance capital costs or maintenance and operation expenses for sidewalks, streets, sewers, water…”

VENTURA WATER TURNS A NON-VOTE INTO A YES VOTE

Ventura wants to use option C, Special Assessments, Fees and Charges to impose higher water rates.

Here’s how they’ll do it. Instead of putting it on the ballot, Ventura Water sends a water bill. Somewhere in the body of that bill, it tells you why the rate increase is necessary. You may dispute the rate increase by voting “NO” within 45 days, but the process is cumbersome. To disagree, you must download a protest form, complete and mail it or take it to City Hall by a specific date. Fail to jump over those hurdles and the City doesn’t care what you think or want. If 51% of the ratepayers have not voted ‘NO,’ that is the end of the matter. There are 32,000 ratepayers. Sixteen thousand one must vote NO to defeat an increase.

Proposition 218, now Article XIII C and D of the California Constitution, made the following findings:

         “The people of the State of California hereby find and declare that Proposition 13 was intended to provide effective tax relief and to require voter approval of tax increases.  However, local governments have subjected taxpayers to excessive tax, assessment, fee and charge increases that not only frustrate the purposes of voter approval for tax increases but also threaten the economic security of all Californians…This measure protects taxpayers by limiting the methods by which local governments exact revenue from taxpayers without their consent.”

When the City sought the last rate increase they took the position that they had the right to raise the rates without prior voter approval. They believed the procedures they followed were consistent with Prop 218 language, as interpreted by the California Supreme Court.  They maintain that they “may raise other fees or impose new fees without prior voter approval” for anything they chose to label a water or wastewater project.

But it doesn’t end with this interpretation alone. A California Supreme Court challenge goes further.

TESTED IN THE COURTS

The California Supreme Court in Bighorn-Desert View Water Agency v. Verjil (2006)39 Cal.4th 205, at page 205, addressed the question of whether voters had the right to put an initiative on the ballot to reduce water rates. The court ruled in favor of the water agency and interpreted Prop 218’s language to mean a city “may raise other fees or impose new fees without prior voter approval.”  The Court’s decision was specific. It didn’t involve the question of whether imposing fees to deal with a Consent Decree are valid.

Notwithstanding the protective measures of Prop 218, the City of Ventura conveniently interprets Prop 218 to still impose fees and charges beyond the simple costs of service to the homeowner. However, the court never went that far.

The City of Ventura’s interpretation of Proposition 218 is overreaching when it comes to any matter about water, wastewater and related environmental projects.

That decision by the Supreme Court only involved the issue of water delivery through a pipeline and whether voters could use an initiative process to require prior voter approval for the costs of that delivery.   It did not involve a question of whether fees imposed to deal with a $500 million water and wastewater projects together with environmental costs, expert studies, attorneys fees and a plethora of expenses arising out of a ConsentDecree decided by a City Council in 2012, and in which the voters had no voice.

What if the costs are not exclusively operational costs? What if the expenditures benefit the entire community, not just ratepayers? Does Proposition 218 apply in those circumstances? Bighorn-Desert View Water Agency v. Verjil does not answer these questions.

No Precedent For What They Plan To Do

In determining whether to seek prior voter approval, we hope that the new City Council will keep in mind the following the language from the Supreme Court in Bighorn case:

            “…the agency’s governing board may … raise fees or impose other fees and new fees without prior voter approval.  Although this power-sharing arrangement has the potential for conflict, we must presume that both sides will act reasonably and in good faith, and that the political process will eventually lead to compromises that are mutually acceptable and both financially and legally sound.”        (Emphasis added).

THE CITY MAY FACE A SERIOUS LEGAL CHALLENGE

If the City is considering rate increase of this magnitude without prior voter approval they should be mindful of the language in Prop 218. It provides that “in any legal action contesting the validity of an assessment, the burden is on the agency (Ventura Water) to demonstrate that the …properties in question receive a special benefit over the benefits conferred on the public at large…”

Complying with the Consent Decree by not putting wastewater into the Santa Clara River benefits all citizens, not just ratepayers.

Editor’s Comments

Ventura Water is proposing a mix of costly projects. Some will benefit property owners, and some will help the community at large. Building a pipeline and related infrastructure to import state water at the cost of $50 million benefits all property owners. Ratepayers generally accept this. Spending beyond that to build projects to satisfy a federal judgment on the Santa Clara Estuary to protect the ecology of the estuary is a problem.

Proposition 218 may not cover projects to meet a federal judgment on the Santa Clara Estuary to protect the ecology. We recommend a vote of the citizens in that instance.

Warn The City Council Of Ventura Water’s Potential Error

Below you’ll find the photos of our current City Council. Click on any Councilmember’s photo and you’ll open your email program ready to write directly to that Councilmember.

Let then know that Venturans must vote on a water rate increase to pay for the consent decree. Not participating in government makes us worse because our city government isn’t working for all of us.

Councilmembers Councilmembers
Councilmembers Councilmembers
Councilmembers Councilmembers

For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.

 

Ventura's water shortage

Ventura’s Water Supply Jeopardized by Years of Mistakes

Whiskey is for drinking. Water is for fighting. —Mark Twain

Ventura could lose one-third of its water supply because of legal maneuvering and backdoor negotiating. As it is, Venturans pay too much for water and could pay even more in three years.

CITY COUNCIL APPROVES WATER RIGHTS CONTRACT

[RESULTS OF NEW AGREEMENT]

Casitas Water District

Casitas Water District negotiated a favorable water contract with Ventura after threatening a lawsuit.

On May 8, 2017, the public learned that a new contract between the City of Ventura and the Casitas Municipal Water District has been approved and executed by the City Council. That new contract places Ventura in jeopardy of losing all rights to water from Lake Casitas.

To maintain its current water rights, Ventura must reach Water Balance by 2020. To achieve water balance, Ventura must find an additional source of water.

The expedient solution is to exercise Ventura’s option to use State Water. The city currently pays $1.2 million per year for that option (which the city never used) and has been paying for that option since the mid-70s. If Ventura does not tap into the State Water Pipeline within three years, Ventura’s water situation will be in dire straits.

NEW CONTRACT IS TOO VAGUE

The old 1995 Contract with Casitas Water allowed for a minimum of 6,000-acre feet of water per year. That water could be used in the western part of Ventura (everything west of Mills Road) and the eastern part of the city, if necessary. Under the new agreement, that changed.

The new contract does not specify the amount of water Ventura’s entitled to receive. Instead, the “projected water demand of the prior year” will determine the amount (Article 4.1). That projected demand will come from Ventura’s annual water report. Should Casitas dispute the amount of water, it opens the Ventura up to a possible “Dispute Resolution.”

What determines the projected water demand of the prior year? Who determines that amount? Do both Ventura Water and Casitas Water have to agree on the volume before the start of each year? There are too many unanswered questions for this agreement to be tenable, and the fact that the Ventura Water Commission recently “received” but did not approve the 2017 report is not encouraging.

NO SCIENCE IN THE COMPREHENSIVE WATER REPORT

Ventura water

Ventura Water provides no accurate estimate of available water in the Comprehensive Water Resources Report.

The Ventura Water Department provided inaccurate and incomplete information in the Comprehensive Water Resources Report dated April 7, 2017. That data formed the basis of the Contract with Casitas Water District.

The financial statements used are suspect because of misleading expenditures. Other assumptions such as using the average water demand are questionable, too. The report includes no real science-based estimates of current water availability or capacity. And there are no timelines for water delivery improvements.

This same report also lists the use of sewer recycled water as a reliable source for potable water in the city. Ventura Water’s General Manager authored that report. She subsequently quit her job and moved to the City of Angels after submitting the report.

THE NEW AGREEMENT PUTS EAST VENTURA AT A DISADVANTAGE

ventura water

East Ventura could lose 1/3 of its water in 2020.

The 1995 Contract allowed Ventura to blend Casitas water with the East End water. Water from the lake was used to mix with water from eastern wells to achieve better quality. Casitas considered the use of their water for that purpose as “rental water.” Ventura was required to return it or to pay for it. The new contract does not allow Ventura to use water in the East End.

Ventura may only use Casitas water within the Casitas District (western part of the City). If Ventura uses Casitas water outside the Casitas District in any one year, then Ventura must reduce the amount of water it uses in the western part of the city until it achieves “water balance.”

If Ventura fails to reach Water Balance within a 12-month period, Casitas may terminate the Water Services Agreement. Overnight, Ventura would lose approximately one-third of the water needed to run the city. Those living on the East side will suffer the most from the loss.

WATER PRICES NEEDLESSLY OVERPRICED

Based upon a very reliable source, who worked in the water community for the last four decades, management decisions by Ventura Water and City Hall over the past 25 years have led to monetary, clerical and water rights losses in the Ventura River. These bad choices forced consumers to pay higher fees even under drought conditions than they should have incurred.

THE CITY COUNCIL SNUBBED THE WATER COMMISSION

Ventura Water

Ventura City Council didn’t seek the counsel of the Water Commission.

While we know the Ventura Water Commission does not have any rights or authority regarding contracts, their experience and knowledge could have been invaluable. But, the City of Ventura Water Commission never had the opportunity to review or discuss the Casitas Water Agreement. The City of Ventura never presented this contract to the commission and didn’t ask for their counsel.

Neutering the Water Commission is a recurring behavior for Ventura Water. The staff’s unwillingness to allow the Commission to do its job has existed for years. It appears they would prefer the Commission to rubber-stamp every decision. They are perturbed when the commission doesn’t do what they want. Given the poor decisions Ventura Water has made during the previous general manager’s tenure, it’s little wonder commissioners might be critical of every issue brought to them.

THE THREAT OF A LAWSUIT EXCLUDED THE WATER COMMISSION

Casitas Municipal Water District intended to sue Ventura’s water department and notified them of their intention according to the City Attorney.   At that point, the attorneys determined that they would treat the new agreement as a pre-legal settlement, thereby closing negotiations to outside parties and masking all records or documents from public scrutiny.

Editors’ Comments

Ventura Water

Casitas Water District could end up owning Ventura’s water rights for $2 million.

As part of the new contract, Casitas forgave an estimated $2 million debt (based upon 4000+ acre feet of water) Ventura Water owes for “rental water.” The Parties agree that as of the commencement of the Agreement, the City is in “water balance.” The City and Casitas are not subject any further legal or financial obligations under the 1995 agreement.

The success of this contract depends on whether Ventura can achieve water balance by 2020 by finding an alternative source of potable water. If that does not happen, Ventura faces the prospect of the termination of water from Casitas Water District.

If Ventura doesn’t find an alternative potable water source within three years and Casitas terminates this agreement, in effect Ventura will have sold its rights to Casitas Water for $2 million.

Ventura can only hope that the new Water Department management will provide full disclosure and transparency, and will lend its voice to the importation of 10,000-acre feet of water from the State Water Project. Forty-eight percent of the voters chose that option in the 1992 election.

Now, will the government listen?

Last Chance To Oppose Higher Water Rates

Ventura Water aims to increase water rates unless citizens protest.

Act Now To Prevent Higher Water Rates!

Monday June 8th is your last day to act if you want to oppose an increase in water rates.  Your protest must be filed with the City Clerk before 6 PM.

On this Monday,  Ventura City Council will decide on whether to adopt the Ventura Water report , written by the Ventura Water General Manger, Shana Epstein.  Click the Report Button to read the full report.

Water Rate Incease Report from Ventura Water

Click on the Report button to access the Water Rates Increase Report

She proposes to raise your water rates. If you use more that 6 HCF in any billing period you will pay more.  If you use over 21 HCF, which is the average residential use in Ventura then will pay a lot more.  This new rate is intended to coerce compliance.

Today we have enough water to meet the needs of our community. Nobody questions the need for all citizens to make an effort to conserve now against potential future water shortages but most however question the need for our City to adopt coercive and punitive measures.

This community will come together to meet this challenge, but never under the lash of government.  If you wish to protest click on the protest icon.

Water Rate Increase Protest Form

Click on the Protest Button to access the Water Rates Increase Form.

Editors:

R. Alviani,     K. Corse,    T. Cook
J. Tingstrom, R. McCord, S. Doll

For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.

City Makes It Hard For Citizens To Protest Water Rates Increase

Ventura Water Aims To Increase Water Rates Unless Citizens Protest

NOTICE OF RIGHT TO VOTE AND PROTEST WATER RATES INCREASE
[State sets Ventura Water Conservation at 16%]

If you are a property owner you have received a NOTICE REGARDING SETTING OF WATER RATES from the City of Ventura (Ventura Water). It was mailed in April.

This notice details what the new rates will be, under water shortage conditions, and provides a complicated chart so that you can determine the impact on your monthly billing rate.  The notice announces that a PUBLIC HEARING will be held before the Ventura City Council on JUNE 8, 2015, at City Hall.

If you do not favor this increase then the City notice tells you that the parcel owner, or customer of record on the water bill, must file a written protest with the City Clerk at City Hall, or at least be mailed, before the hearing date.

The City did NOT enclose a protest form (ballot) with the rate increase notice. You can find the Water Shortage Rate Protest form by going online to a link provided in the body of the letter, however the form is difficult to find from that link.   For your convenience you can find the WATER SHORTGAGE RATE PROTEST form by clicking on the Protest Button below.

Water Rate Increase Protest Form

Click on the Protest Button to access the Water Rate Increase Form.

If you do not have a computer, protesting is not as easy. You will have to go to the City Clerk’s office at City Hall. Please share this with neighbors and friends.

IF YOU DON’T PROTEST, YOU VOTE “YES” AUTOMATICALLY

Unless a majority of the property owners (51%) file a protest, these water shortage rates will go into effect.  Renters have no right to protest.  Business owners have no right to protest.  Only 32,000 people that own property with water meters have a right to vote.  The remaining 81,000 people in the City of Ventura are effectively disenfranchised. They have no vote but will have to pay.

“This city has manipulated and used fees, rates, enterprise funds to further their social and downtown improvements. When this ordinance first started it excluded the mobile home owners from participating because the mobile home communities are all listed as a one property owner, so therefore one owner per park, 10 parks, approx 2500 to 3000 residents without a yes or no vote.”

Jack Tingstrom, former Mayor of Ventura

HOW IS THIS LEGAL WITHOUT A BALLOT VOTE?

The simple answer is Proposition 218, a measure approved by a majority of California voters.  This is not the usual democratic election process.  Usually with a tax increase measure all voters are provided a ballot.  If 2/3 of the voters do not approve, the measure fails.

In this instance Proposition 218 governs.  The underlying principle is that “costs of service”, such as the cost of producing water or treating waste water is in a special category because “the cost” can be objectively determined.

But what happens when the government starts calling something a cost when it is not truly a cost of providing the service?  It is here that mischief and the potential for abuse abounds.  Who can forget the $1 million taken out of the water fund by the City Council and put into the “public art fund”, which was then used to build public housing?  You did not get to vote on that.

IMPACT OF THE PROPOSED WATER SHORTAGE RATE INCREASES

The Proposed Water Shortage Rates (PWSR) proposal must be looked at very carefully by each property owner, and compared to your most recent water bills.  This proposal changes (lowers) the tiers.  If a single family residence (SFR) now uses 0 to 14 HCF (748 gallons equals 1 HCF) you are in Tier 1.  This costs you $2.40 per HCF in addition to the base fixed cost for water of $29.28,  The fixed cost will increase over the next 3 years as well as the flow rate charges. In addition you pay a fixed cost for sewer/wastewater of $19.96 plus $2.91 per HCF flow charge up to 30 HCF.

If the PWSR is adopted and the City Council continues to declare a 20% conservation rate, notwithstanding that the State Water Board (SWRCB) has set our rate at 16%, then you will pay more.  The tier rates will be changed – Tier 1 will be lowered 0 to 6 HCF, Tier 2 will be 7-14 HCF, Tier 3 will be 15 to 30 and Tier 4 will be 30 HCF and above.   In a household of 4 people 6 HCF equals 74.8 gallons per day, or 18.7 gallons per person per day.

Using the current approved rate schedule for a single family residence, with a 3/4″ meter, using 21 HCF, which is the average residential use in Ventura according to Ventura Water Dept., and comparing it to the PWSR here is a chart comparing what you pay now versus what you will pay if the PWSR is adopted.

Ventura Water Rates Increase by 14%.

 

VENTURA IS NOT IN A STAGE 3 DROUGHT

In the fall of 2014 the City Council, in response to the Governor’s statewide drought declaration, declared that our city was in a Stage 3 drought thus requiring a 20% reduction in water consumption.

That declaration has been driving the Ventura City and Ventura Water agenda and publicity campaign.  The reality is that during the 1990 drought the citizens of this community embraced water conservation and reduced consumption by 5,000 acre feet. Thus, the State Water Resources Control Board just determined that the City of Ventura is only required to reduce water usage by 16%, not the 25% that has been widely circulated by Ventura Water over the last year.

”The Governor’s April 1st Executive Order called for the State Water Board to implement a mandatory 25% statewide conservation requirement for urban water usage.  All documents related to implementation of the Executive Order, including the Proposed Emergency Regulations released yesterday…
The City of Ventura’s (San Buenaventura) proposed conservation standard as of 4/28/15 would be 16%”
Jessica Bean, Engineering Geologist, SWRCB

Editors’ Comments

Members of VREG are concerned about several things related to the current process of putting water shortage rates in place.

• We are concerned that the estimates for our community (as shown above) are too aggressive.

• We’re concerned that the protest form was not included in the formal notification from Ventura Water. Providing a link that then leads to a lengthy document where another link to the protest form is buried is hardly calculated to provide “fair notice” under Proposition 218.

• We are concerned that all citizens who are affected by rate increases (like apartment dwellings) do not have a voice in this process.

• We’re concerned that ratepayers understand that they will need to either make a change in their water use or be willing to pay additionally for not reducing their use.

• We are concerned about our water quantity and quality for the future.  Addressing that will require courageous and transparent leadership. 25 years ago all our citizens voted for desalinization to provide a new water resource. City government then did nothing.  Further procrastination is not recommended.

Mayor Heitmann and this Council talk about creating confidence in City government and proclaim that they want citizen involvement and transparency.  This PWSR proposal and notice to our citizens do not serve that purpose. Perhaps “they” should learn to “walk their talk”.

Editors:

R. Alviani,     K. Corse,    T. Cook
J. Tingstrom, R. McCord, S. Doll

For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.