Padre Dam Water District Responds to 'Bad Management' claims
Padre Dam Municipal Water District general manager Allen Carlisle responds to Stephen Houlahan's critique of the District and San Diego County Water Authority
Former Santee city council member Stephen Houlahan is running for Congress in 2022 as a Democrat. After he spoke to the Padre Dam Municipal Water District in favor of an extension for past-due ratepayers affected by the pandemic, I asked him about high water rates in East County and San Diego County in general, the Carlsbad desalination plant, drought, and other water management issues. That interview was published in the Surf City Voice on Aug 1, 2021. Padre Dam Municipal Water District’s Response to that interview below comes from General Manager Allen Carlisle.
Stephen Houlahan said: “Saying they lost $1 million dollars is very misleading” regarding fees in moratorium during COVID19; “the math doesn’t really work”.
Allen Carlisle’s response: In fact, the District did lose between $890K and $1M by not collecting late fees during the moratorium. The District collects on average $63K per month. With a moratorium for 16 months, for example, the District will have forgone $1M.
Stephen Houlahan said: “I believe the Board should have pursued State money rather than use a heavy hand.” regarding the lien process.
Stephen Houlahan said: It should be noted that Padre Dam provided each delinquent customer with information and instructions to participate in the County program (funded partially by the State) to help them pay utility bills. Less than 4 customers took advantage of the program. The remainder chose to ignore the opportunity to get help and did not pay their water & sewer bills.
Stephen Houlahan said: “I believe you need to exhaust all other avenues before cutting off someone’s water”.
Allen Carlisle’s response: Mr. Houlahan does not have a basis to claim that the District did not exhaust all options with each customer. At the point a delinquent customer account is being discontinued, all options have been exhausted including but not limited to: email notification, phone calls and postcards offering payment options; information on the County’s assistance program and other resources; real-time water consumption data through the District’s Automatic Metering System helping customers manage water differently.
Stephen Houlahan said: “…basically Padre Dam is a developer. They want to develop infrastructure…”
Allen Carlisle’s response: This is a false claim. Padre Dam is a public agency formed under California water law. The District is neither a “developer” nor a land use authority. The Cities and Counties that are served by Padre fill the role of land use authority. They approve development within their master planning process. Padre Dam then uses that data to design water systems and infrastructure to ensure the community has an appropriate level of supply/service.
Stephen Houlahan said: The reason Sam Diego has some of the highest water rates in the nation is due to “…unfettered sprawl development… and said there isn’t enough water to go around”
Allen Carlisle’s response: Again a false claim by Mr. Houlahan. San Diego has invested heavily in water resiliency to protect our economy and way of life. Emergency water storage, water transfers from Imperial County, desalination, canal lining, etc. These investments are in part why we have higher rates. San Diego is at the end of the pipeline and has made the decision to build reliability and resilience into our system rather than to risk running out of water like we almost did in the early 1990’s. The region said “never again” and that began our investment in water supply reliability.
Regarding “sprawl development” causing higher rates, the opposite is actually true. Our system, like all systems, has normal “fixed” costs. Those fixed cost are spread across all customer accounts. The more customers that fixed cost is spread across, the lower the unit price will be. Not that water bills will drop when development occurs, but they won’t escalate as quickly. So when development happens, and customers are added, the unit price of water is impacted in a positive way from a cost standpoint. It’s again important to note that Padre Dam is not a land use authority and is agnostic with regard to how/if cities and the County approve developments. We simply build water system to accommodate their plans.
Stephen Houlahan said: “… they (meaning the Board) did not have to do it” Meaning the Board did not have to impose liens.
Allen Carlisle’s response: This is a false statement. The District must have mechanisms in place to ensure timely payment of water and sewer service rates that are subject to Prop. 218. Late fees and other mechanisms ensure paying customers are not subsidizing non-paying customers, consistent with Prop. 218. The various mechanisms available to water districts to ensure payment include the ability to charge late fees, collect on the tax roll (liens), suspend service for 60+ days of nonpayment, refer to a collections agency, etc. The lack of these mechanisms puts the District at risk of non-compliance with State law.
Surf City Voice (question to Houlahan): Since you brought it up, on the issue of the cost of water, the San Diego County Water Authority (CWA) in June passed a budget to increase what it charges for imported water to its member agencies by about six percent. So right now, for treated water it's around $1800 an acre-foot. And about, I believe it was, $1,600 or $1,700 now for untreated. That's about a $500 or $600 s mark-up more than what Orange County local retail agencies are charged [by the Municipal Water District of Orange County] as an add-on to water imported from the Metropolitan Water District of Southern California. Why is that? I'm asking you because you talked about the high price [of water] here. So what do you think of that?
Stephen Houlahan said: I think it's bad management. I think that that the board has traditionally raised the price whenever they can. Water prices are higher than ever. When we conserve, then they use the same exact argument that now they're not making enough money and they raise the price then too. And so if we use the water we get a high price. If we conserve, then they need to make up the shortfall. So it's nice to have a beautiful park like we have here with the Santee Lake. I come here often. It's been here since the 70s. It's an excellent price since the 60s. But part of their model has been to expand and to develop.
Allen Carlisle’s response: This statement insinuates that the Santee Lakes Recreation Preserve (Park) is an expense to the District driving water rates up. This couldn’t be further from the truth. Santee Lakes is a self-sufficient operation as a Department within Padre Dam MWD. The Park receives zero rate subsidy or tax proceeds. All of it’s expenses are covered by the users of the Park who pay fees to recreate there.
Stephen Houlahan said: “And so the problem is [that] they want to capture more market share. In order to do that, they charge higher prices to the ratepayers and then that's how they are able to increase their footprint to make their business larger.”
Allen Carlisle’s response: This is incorrect. There is no “market” for Padre Dam to take more shares from. Padre is a public agency whose boundaries are governed by the State of California through the LAFCO process. The District cannot/will not expand it’s footprint unless other jurisdictions wish annex into Padre Dam’s District. Annexations of significance between water and wastewater agencies are extremely rare.