Copperopolis 8

A reminder to all Diamond XX residents to please attend the meeting Saturday, June 13 at 10:00 am in the Fire District Board Room. This meeting is to continue discussions on possibly forming an assessment district to bring CCWD water to Diamond XX. Everyone's input is important.

As you may know, vote by mail elections for three seats on the CCWD Board, including District 4, will begin July 27 and continue until August 25. At that time, the candidate with the most votes will be elected – there is no runoff. I am running for another term because I want to continue working to make CCWD more efficient, more responsive, and better structured to tackle the coming major water and waste water challenges ahead that I've written about previously.

Let me begin this Update by explaining why I supported the recent change in CCWD Administration:

As this year's Finance Chairman, I oversaw efforts to reduce costs by reviewing all department budgets, including expensive contracts with outside consultants, resulting in significant savings of $1.5 million. Going forward, I will continue to question the justification of using CCWD funds and staff time to pay one particular Washington lobbyist over $600,000 over the last 6 years in so far unsuccessful efforts to secure grants primarily focused on fixing the flooding of Cosgrove Creek in Valley Springs. During my first term as Director I have successfully pushed to reduce payments to this lobbyist, and if re-elected I will continue to ask serious questions about how continuing this expenditure benefits anyone other than property owners or those with self interest in seeking to build in the flood plain.

During my first term I pushed for some $20 million of 'accumulated' funds to be used on capital upgrades and community projects, like adding fire hydrants and connecting Copper School to the new water main. I also initiated a resolution to reallocate some of CCWD’s property tax revenues from subsidizing operating costs into a capital fund that could benefit taxpayers as well as ratepayers.

Because I know rates are already too high, I oppose raising rates to pay for the proposed new multi-million dollar CCWD Administration building in San Andreas.

Rates are rising because rising equipment costs and rising water standards are exposing smaller rural water districts, including CCWD, to the downside of the economics of scale. Today, large capital costs, many mandated by State & Federal law, are poised to be passed on to relatively small, separate pools of ratepayers. This is why, looking forward, long-term solutions must involve cooperation between the various water and waste water districts. Only if we can combine the many small, separate pools of ratepayers into bigger and more integrated pools of ratepayers, can we hope to make the economies of scale work for us instead of against us.

The last four years have been both challenging and rewarding. With your support, I will continue working to make CCWD a better agency.

Tuesday morning I filed my re-election papers at the County. I guess I will find out in short order whether a plurality of you think I have represented your interests well. I have tried my best and am unashamedly impatient for improvements. My initial goal was to try to get more responsiveness and efficienies that might lower costs. I have been relentless and not deterred by “off limits” signs. This caused some discomfort, a little friction, but in only one case opens “hostility”. I don’t believe you elected me to make friends or wait for results beyond our life spans.

I need to remind you when CCWD adopted the 5 year rate model (which I supported) step increases in both water and sewer rates were to kick in each July for 5 years. The steps were to avoid a massive adjustment jump to offset no rate adjustments in the prior 8 years. As chairman of the finance committee I insist all costs be justified, contracting out be rethought and staffing re-aligned if it will improve efficiencies or produce more cost effective results. When I first came on the board approximately $43 million had “accumulated” in district reserves, operating contingency and capital improvement accounts. In the last 3 years $20million of those funds have been spent for the stated purposes in upgrading systems, replacing old pumps (like the new intake pumps in Lake Tulloch and connecting the school to the new water line) so barring emergencies we can operate in a lower cost maintenance mode for in the expectedly lean coming years..

The meeting with Diamond XX residents has been scheduled for June 13^th, at 10 am in the Fire District board room. It is CRITICIAL as many residents as possible attend to give us your input. The preliminary designs was merely to provide rough cost estimates to help determine if enough residents would support pursuing it further. Obviously the lowest cost system would be serving homes located close together but who would pay or use public water needs your input. My thanks to the Diamond resident donating the engineering time and CCWD’s board commitment to help support securing USDA loans or grants if the concept goes forward.

The long anticipated “lawsuit by UPA and Angels “was filed against CCWD accompanied by a press release. While I obviously can’t comment on the merits of the lawsuit, after 2 years of personally trying to forge new “cooperative” approaches, Angels and Murphy’s seem most entrenched in pursuing “old grudges”. Thus I long ago accepted the inescapable inevitability of this action. Perhaps an “impartial venue” might actually help “clear the air” and be productive for more cooperative efforts with water and sewer. Last month I alerted you to the State drought water measures which signaled increased scrutiny of all water reservations and “actual verses paper usage”, including the historic pre-1914 rights considered by some as “untouchable”. CCWD’s board focus has been to proactively look at ways to protect water reservations and maximize use of all water (potable, raw, and recycled). CCWD’s intent is to get more water used and claims ONLY the right to retain for the rest of the County water UPA and Angel’s isn’t using. In my opinion now is exactly the wrong time to go to court to publicly fight over ownership of water you can’t demonstrate use for. ED RICH

My activities this last month were again primarily focused on the districts financial posture with the Finance Director. The board adopted a $1.5 Million reduction in the approved budget plus authorized offering a “golden parachute” option in the public employee’s code that allows early retirement incentives to long term employees. This might help lower payroll expenses and possibly reduces the likihood of possible staffing if the economic down cycle continues. I have made it clear to the General Manager and other board members that my voting posture will be “NO” on any fiscal items that aren’t already in the budget or necessary to maintain “core” services, unless there is an emergency. My posture of “not committing to spend what you don’t have” isn’t appreciated by all, but that’s how I think we need to proceed until things improve.

Planning is continuing on the project to possibly extend a potable water main from Copper Town Center to Diamond XX. Property owners will be notified and a meeting scheduled sometime next month to outline possible areas that might be served and estimated costs. If there is enough support from property owners for an assessment district the project can move forward. One good thing about the current economic downturn is that interest rates are at record lows, (USDA 40 year loan rates this quarter were 3.75%), and might possibly go lower while at the same time USDA infrastructure grant funding may be increasing. Who knows, timing wise this project might find itself in a very rare, but advantageous financing “window”. Aside from that, my reasoning in support of this project is to help use, thus protect, more of our surface water rights in Lake Tulloch which has always been a top priority. At the same time improving fire protection to the north side of Highway 4 might help lower property owner’s fire insurance premiums. Since ground water levels and quality continue to drop in all of western Calaveras County, having a public water sources alternative might also help maintain property values even with those residents with adequate wells. The General Manager and most board members are skeptical about the viability of this project rightly so because of the cost associated with the great distances between homes. Thus the number of people willing to pay into the assessments is critical and the board seems willing to continue to the next step recognizing timing wise this may be the best opportunity ever to extend water to the Diamond XX.

I recently met with the President of the Calypso Bay Homeowners Association regarding getting CCWD to repair some paving around man holes, among other problems, but also the possibly of removing the water meter at their “club house site”? My impressions were its usage as a “temporary park” appeared unsound and that I would support a request from them to the board to remove the meter and refund the fee.

The district received a “Notice to all Water Purveyors” from the Department of Water Resources indicating that due to state wide drought conditions ALL water reservations would be scrutinized, some possibly cut back and reservations not being used might be rescinded. This supports why I have been so tenacious over the last years in trying to get the County and other districts to step up their water usage and planning. Times clearly are changing in the state with regard to water and historical entitlements may soon be challenged.

The main focus of my activity last month was in the budget area. Generating hard numbers to guide the districts operations and not sugar coating either costs or projected revenues is not popular but necessary in the current economy. I fully support the Finance Director in facing the hard realities as they come up and am pressing everyone to be cost conscious. At the last board meeting I asked the board President to put the Finance Directors report first ahead of 2 spending items to identify how much room we had to spend before debating spending items. Unfortunately only myself and one other director seemed to understand that with revenues 30% less than what had been projected and the board unanimously agreeing a $1.5 million cut in spending was needed, a majority of the board voted to renew a $80,000 Washington lobbyist contract. I opposed it because I don’t believe the district can afford to spend monies on anything that doesn’t have direct payback to ratepayers or is tied to core services. The hopes of “attracting stimulus money” seemed to me to be an elusive rationale for spending when positions are being left vacant. I intend to scrutinize and publicly seek justification for every contract irregardless of whoever has a vested interest. It’s unfortunate some directors took my scrutiny personally but I view my obligation is to insure your money is spent wisely.

A preliminary effort has begun to look into the viability of treating “septage” within the County by the Water/Waste water forum chaired by Supervisor Thomas and CCWD board president Bob Dean. The County currently spends a lot of money to truck septage to Oakland for final treatment and disposal when with state permitting substantial savings might be achieved by processing and disposing of it in County. This issue was explored about 10 years ago and I vividly recall the vocal outcry by some Copper resident “not in my backyard”. However, even with that in mind a time will come when all counties will eventually need to be self-sufficient for their own populations’ wastes. On that basis I believe it is in the Counties long term best interest to explore all options thru public forums. Copper’s treatment plant has perhaps the most processing capacity but both Valley Springs and Moke Hill’s plants have enough capacity to be possible sites as well. I also think that the possibility of a private contractor at a remote site, away from residences should also be considered.

Attempts to work out our differences with UPA and Angels Camp over their view of water rights ownership seem to be going no where. My perception is that they are focused on the “undisputed control” of all water reservations within their district while CCWDs view is it must “protect” unused water rights for the balance of the County. Lawyers unfortunately may to be the only winners if this dispute continues down the legal path and past grudges and self interests take precedence over what’s in the publics’ best interest.

What’s the old saying “time flies when you’re having fun”? Must be so because I just started my last year of my elected term and now have to face running for re-election. While on the board I have had many moments of frustration and concluded my role is much like turning a battleship. “slow and steady”. I believe my presence has had some positive impact on districts efficiencies, planning perspectives and outreach to both rate payers and other districts. In politics it seems the first term is the training period and after that your effectiveness and results tend to accumulate with continuity. My hope is that enough of you feel I have had a positive impact on the water district to support me for re-election. As a rather blunt, results oriented person, I often irritate those seeking refuge in layers of “bureaucracy “and prefer the “run around” to concrete action. That said only vocal persistence resulted in retrofitting 2 new hydrants along Reeds Turnpike, connecting the elementary school to the new main, both of which in my opinion should have been part of the original project. I also think Copper Fire now being paid to inspect all district hydrants is a benefit to the community as may be a water line extension to Diamond XX.

Revenues at the district are well below projected thus as the new finance committee chair all costs (especially consultants) and projects are being scrutinized to insure only those essential to basic, core operations area continue. Where we can capitalize on “deals” that improve overall operations I support reallocating funds to benefit from them. For example, a new mobile belt press was purchased at 30% of its original cost for Vallecito’s plant to increase capacity. I opposed increasing the consultant’s contract on the General Plan Water Element project because CCWD was the only district contributing to the county wide effort and in my opinion the consultant’s price seemed high. As chair of the land/water committee I will again bring back discussions on whether spending any more money on planning a new administrative building makes sense. The districts current facility may be obsolete but continuing to spend funds on a new consolidated facility (estimated at $4-6Million?) funded by a new rate payer assessment makes no sense in this economy.

There is no truth to rumors about me leaving the area or in selling my olive oil business. My wife and I did purchase a second home in New Mexico (great deals there) but have also made offers to buy another property in Copper. Both of us have ongoing business and my wife recently renewed a 5 year lease for her business. Another Copper resident did file for a new business license to operate an olive oil store in Copper Town Centre with a similar name to my business, which caused some confusion. Wish them the best of luck, but it’s not me.

Kudos to Dave Tanner of Valley Springs for getting a new bio-filter “blessed” by SWRB at La Contenta. It could dramatically reduce the need for cumbersome spray fields for treated water disposal throughout the County. My understanding is the water that comes out of this system is considered the same as natural raw, stream water allowing for greater uses.

Hopefully everyone had a Merry Christmas and a great new year’s day with your families. At the water district we cancelled one board meeting in December because like you and your family many employees were in holiday mode. During the month I was contacted several times by rate payers indicating financial stress with water district bills and policies. I understand the economic times are stressing many families and as the next chairman of the Finance committee I will begin exploring with the finance director what flexibilities might be possible to “soften” district policies and practices in light of the current economic slowdown. Please recognize the district is precluded by law from “gifting” public funds to select individuals, however broadening our hardship policies, or perhaps loosing grace periods in some circumstances might be possible and hopefully helps you. Several months ago I did get the board to adopt a “foreclosed property” grace period to cover some of the time lag between when the bank assumed paying the bills and the home owner abandoned the property so that the water wouldn’t be cut off adding to the properties physical deterioration. President Dean has suggested bringing back to the County Supervisors a “safety net” proposal he made several years ago since they have fewer constraints on how they redirect public funds than does CCWD as a special district.

USDA sent us a preliminary acceptance letter on a possible grant and low interest infrastructure loan for extending public water lines into Diamond XX. At first blush they are proposing $1,000,000 grant and to an additional $5,000,000 (loan terms would be locked in later on but they previously suggested 30 years at 2.5% interest) may be possible. Next step is to get input from the residents via public meetings and developing more firm engineering plans the submitting a formal application. If a majority of residents don’t support going further with an assessment district then the matter dies and we tried. While I don’t know what the costs will be it does seem if there ever was a time when public water might be extended to the Diamond XX at a low cost the time seems now. I am also contacting Meridian Mine to try and get them to participate in the assessment district as more people that use the system the lower the cost will be to everyone. Hopefully they will see the benefit to having their property served by public water.

County wide I am hopeful the changes in elected officials will soften the critical attitudes toward CCWD’s attempts to find regional solutions, especially in the Murphy’s-Angels corridor. Newly elected council members in Angels initially seem open minds toward finding shared solutions and cooperation beyond political boundaries. Only time will tell and I will do my best to push CCWD to be as responsive to all special district that want to find shared solutions wherever I can.

It’s been relatively quiet since my last report, nothing earth shaking or major breakdowns to report in the district. The sewer holding ponds are empty, all the beloved misters have been sent to Valley Springs, and we are putting a roof over the ultra violet filter. I did learn my updates are being read by other districts which is good because even thought my points of view may be upsetting to some, clearing the air and some openness may be best in the long run. Recently CCWD co-sponsored with Sierra Business Council and State Department of Water Resources a seminar at Kautz Ironstone to get an update on the future direction of State water policy. I was pleased some of you attended because it hopefully clarified that the emphasis of regional efforts and more efficient use of all water (including reclaimed) will be increasingly important at the state level and is more than just my ranting. My hope is “hearing it from the horses mouth” enabled some of the districts that attended to recognize current CCWD boards efforts are to strengthen the Counties position in the coming years and is not just a CCWD “take over strategy” as some unfortunately have view it. That said, only time will tell if cooperation prevails but in the short run I intend to focus on solutions for immediate district problems.

The most immediate issue is fiscal stability. As the chairman of the investment sub-committee the entire agency portfolio over the last two years was restructured away from government backed Fannie Mae and Freddy Mac mortgages to a much more diversified holdings. With the exception of one Lehman Brothers bond holding the agency’s investment capital is in good, safe investments. It’s too early to tell what return we will get on the Lehman Brothers bonds since it is tied up in bankruptcy however as a preferred creditor some return is expected. What is frustrating was that that bond rating was A-1 (that good folks) when we bought it and was the same just the week before bankruptcy was filed? Beyond that, revenues are extremely slow, with only one new service hook up last month county wide, thus all costs are being scrutinized. Since I also sit on the Finance Committee, I am asking that all our agency outside contracts be reviewed to insure we do as much in-house as possible and contract change orders be justified. I recently was the lone NO vote on the board in approving an increase to the water elements consultants contract. While I supported the effort, insufficient justification was provided for the increase so I voted NO. I also intend again to try to persuade the board to terminate the Washington lobbyist contract, not because it also doesn’t have merit. But simply, I believe all residents would be better off if the District and County shared the cost of one lobbyist instead of each having and paying for its own.

I did receive one call from a district customer seeking financial relief on water bills for vacant rental property. I asked that person to make a personal request during the public comment period at the next board meeting to gauge the boards’ response. Several months ago a similar request resulted in the board adopting a policy providing some relief for homes in “foreclosure” and perhaps some “economic hardship” modification might be possible. In this persons case it involved rental properties which may be harder to justify than economic relief for personal residences. I know times are tough and I will try to provide any assistance I can on the district to help all of us get to better times.

I just got back from an extended trip out of the Country and found the local election results did alter some of my thoughts. In my last update I reported my frustration with Angels, Murphy’s and UPA unwillingness to give more than “lip service” to exploring cooperative or regional solutions to water and waste water. Some of that attitude stemmed from an unwillingness to abandon historical grievances against CCWD by some of their board members irregardless of the outreach by me and new board President Dean. Additionally the one City Council member advancing a new “Water Federation with UPA” was trying to unseat Supervisor Tyron, a long advocate for shared water and wastewater services in the Highway 4 corridor and perhaps his political agenda challenging efforts were to help his election. Well, the election is over and hopefully the newly elected council members in Angels will be more “open minded” than the old board especially where solutions that make political and economic sense are considered, irregardless of who comes up with the idea. I was greeted on my return at months end with another lengthy copy of a complaint letter from the General Manager of UPA balking at providing input to the County’s water element task committees on the original timeline, citing they are being “rushed”? Once again I am confused at this tactic since all other districts agreed to work with the County established time frame and NEITHER, UPA or Angels are subject to the general plan? I can only surmise the notion of cooperating outside of their own jurisdictional boundaries is politically difficult for them even when their input is a courtesy.

Irregardless, I continue to try to improve CCWD where ever I can by insisting that wherever possible it take the role of a “resource” with all districts and jurisdictions. I do this because the future clearly indicates only cooperative and consolidated operations will improve efficiencies and help control costs. Angels, Murphy’s already have among the highest water rates and operating costs in the County but apparently maintaining their own jurisdictional borders trumps lowering costs? Our operations manager recently reviewed proposals from Angels new Ultra violet filter system and offered solutions we used in the Copper system that might save them over 50% of their current bid. We also suggested contracting for use of CCWD’s “television” truck rather than buying its own camera system and new truck (about $500,000). This specialized equipment isn’t used all the time so why not rent ours when the need arises and use those dollars somewhere else? I have always encouraged our operations staff to routinely providing technical expertise when asked however I must admit I am getting concerned that it isn’t fair to rate payers to continue to expend CCWD staff time or expertise especially with districts that don’t intend to reciprocate cooperatively or even express gratitude. Who am I to deter those that want to squander costs and learn from their own mistakes? Perhaps as Forrest Gump’s suggested “stupid is a stupid does” is advice I need to accept?

Locally I want to thank everyone in town that helped in the fund raiser for Brice Burton, son of our Copper field operations employee Danny Burton who was paralyzed from a staff infection. Over $20,000 was raised to help the Burton family meet their immediate expenses while Brice seeks to recover. Not much else is happening except for ironing our details to expand the booster pump station on Reeds Turnpike to increase capacity flows to the new water tanks.

CCWD DISTRICT 4 UPDATE

October 7, 2008

Did any of you happen to read the Ledger Dispatch article, dated September 16, 2008 entitled “War and Peace”? For those that didn’t see it, it was about Amador County launching a “precautionary” water plan, with “regional scope” developing “purple pipe” systems. Sound familiar? Amador recognizes the “drums of war are beating all over the state of California ...over water” and that water entitlements in the future will be tied to demonstrating “maximum use of water supplies” which will include both raw and recycled water use to offset drought demands. Because water is essential for human life only those purveyors that demonstrate they are maximizing ALL water resources will escape stiff scrutiny when they attempt to renew state water entitlements. What AMADOR is doing (with 5 incorporated cities) is exactly why I have been pushing “dual” systems in new projects and “regionalization” in Calaveras. My goal has always been to make CCWD more responsive to its customers and other district because I firmly believe working together is in all our best interests.

Unfortunately some of Calaveras special districts still view anything CCWD’s initiates with suspicion. They view attempts toward collaborative, county wide initiatives as “power grabs”, rather that see it as an effort similar to Amador’s that develops a county wide, defensive strategy to protect their County’s imperiled water resources. CCWD, by charter and vote of ALL residents of Calaveras County (including Angels Camp residents), is mandated to protect water rights and “develop water works”.

At the recent kick off meeting for General Plan Water Element, which is a legal document and blue print for future growth that will be a crucial instrument for justifying and protecting future water rights, Angels Camp (which by the way isn’t subject to the County general plan) proposed forming its own “water district federation” with Murphy’s Water (UPUD) and Utica Power Agency (UPA) (which is wholly owned by the City of Angels and UPUD). Aside from having NOTHING to do with the General Plan element the proposal did suggest that some districts may only be giving “lip service” to looking for County wide solutions to water and waste water. Apparently over $100,000 of PUBLIC FUNDS have been spent investigating UPA’s ability to challenge CCWD’s secondary interests in the water after it has gone thru the Angels power plant. I would have rather that money been spent to upgrade or expand delivery systems and serve more customers than squandering resources to squabble over water that is ALREADY a Calaveras County entitlement.

My hope when I was first elected was to reach out to all of these districts to find better water/waste water solutions for all County residents. That is why I arranged several breakfast meetings with all the districts plus was an ardent supporter of LAFCO water forums (I think there were 3 or 4 broadly attended meeting) in which all districts indicated they wanted to work cooperatively. Thus, Angels City Managers position at the General Plan meeting shocked me because it was the first time I had heard about “their plan” which I must assume was worked out independently of CCWD. Personally I found the complaints that the consultants pursing the General Plan Water Element efforts were only “CCWD’s contractor” totally disingenuous since all districts were repeatedly invited to contribute funds toward the County wide effort. What I also find so short sighted about Angels proposal is that my understanding is those districts have historically NOT demonstrated they can use all the water already reserved for them and have among the highest connection and service rates in the County.

I have always operated from the belief that “If you’re not part of the solution, then you are part of the problem”. Perhaps residents of some districts need to begin asking their elected official whose interest they are in fact serving. Historical grudges and personal biases should not be put ahead of finding the best solutions for the public. There has been one positive spin-off from the demand data I conducted last year in my County wide non-potable water study. UPUD is now exploring moving beyond its old, gravity, and ditch and pipe systems and possibly serving more agricultural customers. I applaud that effort to serve more customers.

Locally the preliminary application was submitted to USDA for the possible water extension to Diamond XX. I also contacted Meridian Minerals to solicit their participation which would significantly increase the likihood the grant approval and possibly lower everyone’s costs. The current budget and Capital Improvement Budget (CIP) still concern me as not being austere enough. The current economic downturn is unprecedented thus I feel the agencies top priority for available dollars should be limited to upgrades or replacement of the existing systems. As Chairman of the investment committee, I am also working closely with the Finance Director to insure those funds the agency holds in trust for you are protected. We currently have one bond of about $1.4 million that might be in jeopardy but it represents only 5% of the total portfolio value and time is needed to see what happens. In the last 3 months over $5 million reserves were transferred out of bonds, into insured CD’s as a precaution.

Training of fire department personnel has been completed so that they will now be paid to inspect Copper area fire hydrants. I think this is great for all Copper residents and really appreciate the support of Chief Cantrell and the new fire board. On a further note, I was recently alerted to the possibility CCWD inspections approvals were being falsified on some new construction homes. We met with the County building department and verified one contractor was falsifying CCWD inspection with a counterfeit stamp. Those homes identified will be having their occupancy permits rescinded until they are re-inspected and possible legal penalties for the perpetrator are being investigated. Please let me know if you think anything improper is happening with the water or sewer systems in this District.

Ed Rich, Director.