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Mesa Water board OKs rate hikes

The first of the increases, to be phased in over five years, is expected to raise the average monthly bill by about $2.

December 13, 2013|By Bradley Zint

Mesa Water District board members Thursday approved a series of rate increases, contending that the extra revenue will be needed as district expenses continue to rise and capital improvement projects costing millions take shape.

The board voted 4 to 1 in favor of the 15% increase, which will be phased in over five years. The increases start on July 1, with subsequent hikes scheduled for each January from 2015 through 2018.

Director James Atkinson dissented, saying he believes that the higher rates, while needed, should be spread out over a period longer than five years.

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The first hike is expected to increase the average Mesa Water bill by about $2 a month, according to district projections. It will take effect after the last increase — a 25%, five-year hike enacted in 2010 — ends in June.

The board members said they wrestled with the idea of escalating their neighbors' cost of living, but see the move as a long-term strategy benefiting Mesa Water's infrastructure and financial stability.

"We have a balance of a formidable mission and the immense authority we've got," said board President Jim Fisler.

"The five of us are ratepayers also," said Director Ethan Temianka. "We've taken that into account. We've deliberated for months and months."

The bulk of the increased revenue will go toward operating expenses — expected to rise between 2.5% and 5% a year — and a planned $35-million capital improvement program, Mesa Water officials said.

The smallest portion, 7%, will bolster the district's reserve fund. District officials project having $28 million in reserves by the end of this fiscal year and $40 million by 2018, the last year of the increase.

Mesa Water's leadership stressed that, compared to other Orange County water districts, the independent district is among the most efficient and maintains a low water production cost. It also needs to maintain its AAA bond rating and have strong reserves for potentially costly emergency repairs.

"I won't kick the can down the road," Fisler said. "There's enormous risks in the philosophy like that."

District officials said they received 41 written protests to the rate hike. Three letters supported it, and one asked for a delay on the vote.

Two speakers attended Thursday's meeting at Mesa Water's Placentia Avenue headquarters to voice their concerns.

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