There should be no increase in the Santa Clara Valley Water
District’s Water Extraction Fee, better known as the pump tax. In
fact, a reduction is in order.
Dear Editor,
There should be no increase in the Santa Clara Valley Water District’s Water Extraction Fee, better known as the pump tax. In fact, a reduction is in order. Here’s why:
In 2002 the Water Board approved the $4.6 million Solar Natural Gas Generator and Heat Recovery project. Why does the district need to spend so much on a project that delivers less than 20% of the district’s energy needs and will take 25 to 30 years to pay back this investment? It would be more cost effective if they had invested in a quick start power generator like most hospitals have.
The SCVWD said the project was a hedge against future blackouts and surging electric prices. When I looked into this, I was surprised to find out how this $4.6 million project was paid for: $2,955,000 from the Water Utility Enterprise Fund, which is a direct violation of the District Act, Section 26.3; the rest cobbled from the Watershed and Stream Management Fund, the Lower Peninsula Watershed Fund, the West Valley Watershed Fund, Guadalupe Watershed Fund, the Coyote Watershed Fund and the Uvas/Llagas Watershed Fund. Just think, that $4.6 million could have paid the perchlorate cost that the District is charging us, the well owners in South County.
In 1987 the Central Valley Water Project was completed. SCVWD turned on the spigot and started charging well owners a pump tax. CVWP brings water from the Delta via San Luis Reservoir. This new tax was to pay for the imported water and the operating system that moves the water. Also, it was to be used to repay the Bureau of Water Reclamation for the $248,000,000 loan to build this project.
The SCVWD made one payment of $900,000 in 1987 and for 20 years made no more payments. Granted, the District was in litigation for many years with the Bureau of Water Reclamation and amended the CVWP contract in 2007. But that is no excuse for not paying back this loan.
When you look at past Comprehensive Financial Reports, the SCVWD set aside millions to pay back the cost of the CVWP. These funds were not used to pay off this project, they were spent on other projects.
In 2007, the district renegotiated with the Bureau of Water Reclamation. The Bureau said ok, but it will cost you big time for not making payments on the project. Now this $248,000,000 project is going to cost you $440,492,081. So, from 2007 to 2036 – the length of the new contract – the SCVWD will be making payments for the next 29 years. Currently it’s costing $14,933,733.58 per year. That means that we, the well owners, are paying 77% more for this project. Just think, that 77%, which amounts to $192,500,000, could have been used for updating the 5 dams with seismic problems.
Since 1987, this pump tax has gone up by 1,150%. Do you know of any other utility that you are currently paying for that has risen anywhere near that amount in that short of time? I don’t think so.
There were times when we were told by the SCVWD that the price of water from the Bureau of Water Reclamation was going up during the 2000 to 2007 timeframe. This was not true, because the cost of water to the SCVWD was flat during this time period, yet the District kept increasing the cost to the well owners. In 2005 for example, the cost per acre foot was 90% above what the Water District paid the Bureau of Water Reclamation for water – a 90% mark-up.
Since 2000, the SCVWD has given themselves big increases in salaries. SCVWD employees make 25% more than like jobs in the private sector. Retirement pay has increased to 2.5% on the CalPer’s Retirement Program. Employees retire with 75% of their pay for the rest of their life. Currently, the average employee makes $150,000 a year in salary and benefits. Meanwhile, we keep paying ever-escalating cost for water. Over the past 11 years, salaries and benefits for SCVWD employees have increased 136%. Who in the private sector has had these kind if increases in this short of time?
In the 2009-2010 budget, salaries and benefits make up 38%. The SCVWD has too many employees and needs to reduce their staff.
Robert J. Cerruti, San Martin
