Editorial from June 15, 2007

"DWP commercial rates"

By Danielle Seckler

   There seems to be so much confusion about Prop 218 and the California Supreme Court ruling for the case of “Bighorn-Desert View Water Agency vs. Verjil”.

   Prop 218, passed in 1996, does not decide how much of an increase or decrease in water rates can occur to any DWP customer. Prop 218 decides the procedure that must be followed. The procedure is that at least 45-days before a public hearing, notices must be sent our. The DWP sent the notices out in the beginning of April and the public hearing was set for June 5th. The old-fashioned majority of 50% + 1 must protest by giving the DWP their protest, in writing before the hearing is started. Silence is seen as customer consent.

   As of June 2006, there were 15,442 total customers. There are 823 businesses in the DWP area, with the majority located within the City of Big Bear Lake. That leaves 14,619 residential customers, spread out in Fawnskin, Moonridge, Big Bear Lake, Sugarloaf, Erwin Lake, Lake Williams, Rim Forest, and 1 lonely connection for Big Bear Shores RV Resort.

   Mathematics does not lie. To get 50% +1 protestors of the commercial rate increase, the DWP would have had to receive at least 412 written letters. If one takes the total number of customers, 7722 would have had to write protest letters. The DWP received a total of 48 letters of protest. Mathematically, neither number of commercial or total customers protested above the 50% + 1 standard. Therefore the rate change should go into effect, as the procedure prescribes.

   The reason Prop 218 came into this mess was that the California Supreme Court made a ruling in the case mentioned above. This case determined whether user fees and commodity charges – such as those for water services – are subject to Prop 218 procedures.  The court basically ruled that no one could force any governmental agency that provides a service to pay less than the cost of basic service. It did not rule against a tiered rate to force customers to conserve. Water is a commodity and the more you use, the more must be produced to meet demand and the cost goes up. The DWP will evaluate each business and determine a ‘water budget’ and any business or governmental agency using more must pay the higher price. This will affect mostly those businesses that use water for landscaping, such as large lawn in front of Prudential or the school/park systems, with their leaky irrigation systems. If a business or high end user irrigation user wants to keep their lawns, then let them pay for it. The same tier system is in effect for residential users.

   The court ruled that all customers must be treated equally. The businesses have stated that they don’t think that they should pay any different amount than the full-time residential property owner. The first tier for both businesses and residential customers is $2.06 per CCF currently. However, business use more water, need large pipes to their establishments, and the system needs a higher standard to deliver the water. That is why the cost to businesses has been established at $4.37 per CCF. To provide water for fire, health and safety to all customers, each type of customer must pay their fair share to make sure that infrastructure is in place. If the cost to deliver water to a business is higher than to a residence, it is part of the cost of doing business. If a small number of customers are not paying the cost, then to keep the system available to everyone the cost of filling the deficiency is left to the other customers. This is common sense and should be clear to everyone.

   We understand that the businesses are upset. Even if they feel that the increase is justified or that this issue should have been taken up years ago, there is no alternative. Every year the cost to the DWP goes up, so an incremental increase will not catch up. The DWP followed the law of the land and the protest vote failed, so the City Council is obligated to certify the increase. If the City Council does not do so in a ‘reasonable’ time frame, the City can add another lawsuit to their growing list of closed session items. The City Council does not have the right to change the procedure laid down in Prop 218. It is a hard decision to make, when a room full of people is sitting angrily before you. Their predecessors before them let it slide. The only “wiggle” room the City Council has to avoid a lawsuit is what a ‘reasonable’ time is. Residents of Big Bear Lake have told us that if the City Council decides to not to allow the increase or to draw out the increase; they are ready to sue.

   It is time for the City Council to bite the bullet. The process is completed. The increase to commercial and government has been passed. The only thing left is decide when the rate increase goes into effect and what a reasonable time frame is. Putting the increase into effect on July 1st, in the middle of summer, is what the DWP wants to do. The City Council could ask for the increase to go into effect on January 1st, leaving the businesses, schools, and parks a year to get their in order. If they do anything else, they will open themselves up to a lawsuit and the loss of taxpayer money on attorneys and staff time.

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