Water company budget inspires hot debate

Acorn Staff Writer


Customers of Las Virgenes Municipal Water District (LVMWD) can expect stable rates this year, but critics believe water and sewer rates should be lowered because the new budget is said to be flush with reserves.


The LVMWD Board of Directors approved a record $46 million budget last week that includes a surplus of $13.7 million earmarked for capital improvements.


Boardmember Vernon Padgett accused LVMWD of "hoarding" money that could be used to cut water and sewer rates. Padgett voted against the budget after losing a bid to set aside $1.9 million for rate reductions.


"Independent districts have a tendency to hold on to as much money as they can," Padgett said. "The [Las Virgenes] District has much to gain by a rate cut to our customers."


Padgett recommended that some of the capital improvements be deferred and attacked LVMWD’s decision to allocate $5.8 million to a rate stabilization fund, a method to provide income for the district in the event that water sales drop, during an El Niño year, for example.


"When water sales go down, our debt doesn’t go down and our obligations don’t go down," said Glen Peterson, boardmember.


"That money is there to protect the public," Peterson said.


Reduced expenses coupled with rising revenues due to a growth in housing and business development – the district’s connection fees are expected to increase 65 percent over last year’s $1.6 million – give the LVMWD its brightest budget outlook in years.


But aging pipelines and other infrastructure needs demand immediate attention, officials said.


"We have cut expenses. We’ve cut expenses so much we haven’t kept up with replacing our infrastructure," said boardmember Ann Dorgelo.


The district pegged its five-year capital improvement plan at $49 million, more than double the amount projected last year.





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