Despite Protests from Community and Water Agencies, MWD’s Over-Collection from Ratepayers Will Continue

Despite efforts by business groups, community activists, mayors and several Southern California water agencies to stop  unecessary rate hikes and increased property tax collection by the Los Angeles-based Metropolitan Water District of Southern California, the board voted to increase spending by $75 million instead of returning the money or rolling back rate increases.

The Southeast Water Coalition Joint Powers Authority on Monday sent a letter to MWD’s board of directors urging the giant water wholesaler to maintain current water rates instead of charging 5 percent more in 2014.

“Given that MWD has evidently underestimated its FY2014 water sales, SEWC calls on the Board to… hold the current rate,” the letter said.

The coalition also criticized MWD’s plan to suspend the state’s limit on the agency’s property tax rate, saying it appears to be an “end run around the California legislature’s corrective action of 1991 to hold MWD’s property tax rate to bond costs actually paid.”

San Diego Mayor Bob Filner, working with a business alliance including the San Diego Regional Ecomonic Development Corporation and Chamber of Commerce, led the charge to protect the regional economy.  The Mayor, Chamber and EDC submitted letters to MWD protesting the rate and tax increases.  Oceanside Deputy Mayor Jerome Kern and Poway City Councilman Jim Cunningham also spoke on behalf of their ratepayers to show MWD  how its rate increases hurt the average family.

The San Diego County Water Authority also objected and sent a letter questioning MWD’s budget actions because MWD has not developed a long-range financial plan to ensure its ongoing obligations and investments will be supported by its member agencies. Water Authority delegates to the MWD board asked MWD to refund the $75 million in overcharges to ratepayers across the region, including $16.4 million to San Diego County, and forego additional tax money.

Officials at Burbank Water and Power also sent MWD a letter of concern on Monday, saying they were “disappointed, to say the least” about the rapid growth of MWD’s reserves.

“It appears that MWD has missed an important step for good governance,” said Burbank’s letter. “The lack of clear and direct communication as to the current state of MWD’s budget and reserves has done real damage to the credibility of MWD management.”

Burbank officials said they don’t support MWD’s plan for a 5 percent rate increase in 2014. “The facts simply no longer support it,” their letter said.

Long Beach representatives also implored the board to roll back next year’s planned increases and Mayor Robert Foster from Long Beach sent a letter.