SCV Water committee reviews water costs, no change in water rate

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SCV Water officials who voted in May for no increases to the property tax rate remained true to that pledge when they reviewed state water costs and revisited rate-setting recently.

The SCV Water’s Finance and Administration Committee met on the issue Feb. 11.

In May, when the board voted for no increase made to the agency-set rate, it was with the condition that the board get a mid-year status update.

“This is just a mid-year review of the current rate,” Kathie Martin, spokeswoman for SCV Water, said Feb. 11.

“The item indicates that the current rate is sufficient to pay the (state’s) Department of Water Resources water supply contracts through June 30, 2019 – the end of this fiscal year,” she said.

The tax rate for next fiscal year will be a separate discussion as part of the budget process, she said.

“This isn’t setting a new rate, or voting to extend the current rate for another year, just a review of the current rate,” Martin said.

Property values

The agency-set rate is based on property values assessed for ratepayers living in Los Angeles and Ventura Counties.

The money it collects pays for maintaining the infrastructure needed to bring Northern California water to the SCV.

A memo to the committee from Rochelle Patterson, director of finance and administration, reads: “To be fiscally conservative and recognizing that State Water Project costs are increasing at a rapid rate, and to mitigate future tax rate increases as SWP costs continue to increase in the future, the Committee recommended that there would be no change in the tax rate at this time but wanted to ensure the fund was periodically reviewed based on the knowledge that there would be increasing  SWP costs.”

Next year’s agency-set rate may reflect the cost of a number of infrastructure projects undertaken by the state.

“The original budget included $2.1 million of funding for California WaterFix, which have not materialized in FY 2018/19,” Patterson wrote in her memo.

California WaterFix

California WaterFix is an upgrade to the 50-year-old water infrastructure which promises to make it easier to move water in an environmentally friendly manner.

According to state water officials, the current system is outdated and unreliable, and dependent on levees that put our clean water supply at risk from earthquakes and sea level rise.

Patterson noted in her memo to the board that California WaterFix is not the only big cost on the horizon.

“There are several projects and charges that are being considered for the 2019 Statement of Charges that will need to be considered when setting the rate for FY 2019/20,” she wrote.

Project costs

Some of the increased project costs that would need to be considered when setting the Agency-set tax rate may include:

  • Increased Water System Revenue Bond Surcharge.
  • Increased Delta Water Rate – Oroville Emergency Response Costs    
  • Increased Transportation Variable – previous year under collection
  • Funding for the California WaterFix.

The Agency-set tax rate is reviewed and adopted every year.

The unchanged tax rate amounts to 7.06 cents for every $100 assessed on your property. For example, for a home assessed at $500,000, the annual tax would remain at about $353.

State Water Project

Northern California water is brought to the SCV according to the terms of the State Water Project.

The cost of delivering that water to the SCV is “increasing at a rapid rate,” one local water official noted in May.

On April 30, 1963, the CLWA — then known as the Upper Santa Clara River Valley Water Agency — signed an agreement with the state to receive 41,500 acre-feet of water each year from Northern California as part of the State Water Project.

Just over a half-century since the agreement was hammered out, SCV Water’s predecessor, the Castaic Lake Water Agency contracted with the state to receive more than double the original allotment, or about 95,200 acre-feet of water each year.

About one-quarter of every dollar paid by SCV ratepayers goes to covering the costs of receiving water from Northern California.

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