GILROY
– Terry Mahurin has never spoken out on anything political –
that is, until now.
The 66-year-old retired engineer has spent the past few months
pouring over Santa Clara Valley Water District financial
documents.
GILROY – Terry Mahurin has never spoken out on anything political – that is, until now.
The 66-year-old retired engineer has spent the past few months pouring over Santa Clara Valley Water District financial documents.
“To me, the water district has just lost their credibility,” the Morgan Hill resident said.
Meanwhile, another retiree, 67-year-old Bob Cerruti, of San Martin, was reviewing much of the same information. In May, the two men found each other and jokingly call themselves “partners in crime.”
After it became apparent the water district was going to raise wholesale water rates in South County by 25 percent, the men became activists. Both attended an April 26 meeting held in Morgan Hill about the rate increase.
“I heard some things that didn’t sound right,” Mahurin said. “I went through their budget. I began to look in areas where I thought I’d see interesting things.”
Among their areas of concern are employee compensation increases, recent new hires, increasing municipal-and-industrial water rates and a $4.6 million solar project.
Mahurin shared some of his findings at a water district board meeting in May.
“Their response was zip,” he said of the board. “I don’t know if they were stunned or not. I’m sure their view was if we ignore this person, he’ll just go away.”
Board member Sig Sanchez said he was impressed with Mahurin’s research.
“He was very knowledgeable, as I recall listening to him make the presentation,” Sanchez said. “He went through the budget quite thoroughly.”
In June, the water district board of directors voted in favor of the water rate increase that took effect Thursday. They also approved a $241 million operating budget for this fiscal year, which runs through June 30, 2005.
Benefits, health insurance costs rise
Cerruti and Mahurin see multiple areas in the operating budget where they think the water district is overspending. One such case is employee compensation. Cerruti says in the past two years district employees have received a 52.4 percent increase in their salaries and benefits.
This simply is untrue, Sanchez said.
“We have three bargaining units we deal with. The last bargaining session I think they got 3-and-a-half percent to 4 percent,” he said.
Health insurance has risen by 20 percent each year. The public employee retirement plan, which the district’s employees are enrolled in, billed the water district for $2.5 million for the first time in 2003 and likely will charge $8 million this year.
Also, included in this increase are new hires. Currently, about 890 people are employed full-time, up from 785 last July. The water district is budgeted for 915 full-time employees.
“We hired the best and the brightest from the (dot-com) bust,” Water District spokesman Mike DiMarco said.
Cerruti and Mahurin aren’t buying the water district’s explanations. They are frustrated with the water district for approaching taxpayers for more money, while they see the water district spending money on other budget items or keeping extra in its reserves. Reserves are estimated to be $436 million for this year.
“I think that they’ve had so much cash over there for so long that they’ve gotten into this, ‘Well, let’s stick it to the rate payers mode,’ ” Mahurin said.
Sanchez agrees that the water district is overspending. He was the only one of the seven board of directors to vote against the 2004-05 budget with its nearly 3 percent growth.
“All government agencies are cutting back, and we continue to expand,” Sanchez said. “We have a lot of capital improvement programs. Many of those can be delayed.”
Light shed on solar project
Cerruti resigned from a district flood control committee in part because of the district’s decision to use water rates to build a new $4.6 million solar project that is supplying about 20 percent of the water district’s energy needs at its south San Jose campus.
However, Sanchez supports the solar project. He said it should pay for itself within a couple of years.
Cerruti said the board rubber-stamps the budget. But Sanchez said he questioned everything.
“He (Sanchez) is probably one of the most vigilant in terms of holding staff’s feet to the fire,” DiMarco said. “He wants an explanation for every penny.”
Rosemary Kamei, who represents District I on the board, said the district is cutting back, however the public doesn’t always see it.
Paying for rain water, too
Cerruti and Mahurin also suspect water users in South County are being overcharged for a service that isn’t working – water recharge. He said prior to the importation of water, rain was successfully recharging the groundwater. A substantial amount of water which helps recharge the Llagas sub-basin is still rain water, he said.
“We’re getting charged to pump Mother Nature’s water out of our well,” Cerruti said.
DiMarco said the district is charging for rain water – to some extent.
“We don’t meter the rain water,” DiMarco said. “I guess in a way we are charging them for the rain water. We do operate the reservoirs that catch that water to refill the groundwater basin. What we’re charging for is all of the operations.”
As for the recharge, DiMarco said if it wasn’t working, people would know it. The district is preventing the underground water basin from emptying too rapidly, he said.
Lastly, Cerruti worries about the effect of the water rate increase on senior citizens in San Martin who already are living on a fixed income. He hopes the water district will consider giving them a discount. DiMarco said a special senior rate has been considered.
Kamei was the only board member to vote against the water rate hike because she wanted to explore implementing the increase over time. She was concerned about farmers, in particular, who hadn’t seen a rate increase in more than 11 years. Their water rates increased from $11.50 to $14 per acre foot if they participate in the county’s conservation program.
According to the officials at the district, water costs are increasing because the price of imported water from the San Luis Reservoir is increasing. Later this year, the district will renegotiate its contract with the Central Valley Project, a federal program managed by the Bureau of Reclamation. The new cost is expected to increase from roughly $100 an acre foot to $250 an acre foot for water designated for municipal and industrial uses. Agriculture water is sold at a discount. It would increase from $35 to $135 an acre foot.
The water district’s own operating costs also rose, DiMarco said. Despite the 25 percent rate increase, the South County operating budget will still experience a $1.7 million deficit.
“We’re trying to find a way to balance the costs and the revenues,” Kamei said. “Right now, the costs don’t equal the revenues. The costs are much higher.”
Mahurin and Cerruti have only just begun to delve into water district matters. They have requested a meeting with Kemei, who represents southern Santa Clara County, for next week. Kamei said she would like to talk to the men.
“I have talked to Bob,” Kamei said. “I know he’s not convinced. I can get him the information. If he’s not convinced, then there’s nothing I can do.”
