For the first time in eight years, the Santa Clara Valley Water
District board of directors might not raise groundwater
charges.
Morgan Hill
For the first time in eight years, the Santa Clara Valley Water District board of directors might not raise groundwater charges.
At a meeting Monday, the board will consider both a “zero-increase” rate scenario and a budget for the 2009-2010 fiscal year that is more than $100 million less than the current year’s budget. District staff is recommending that the board keep the charges at their current level, and that it adopt the budget they will present at the meeting.
The staff initially recommended that the board adopt a groundwater charge increase of 3.6 percent per acre foot in South Santa Clara County to bring in revenue they expect to lose from mandated water conservation efforts throughout the district over the next year. That recommendation included about $12.5 million in budget cuts.
However, due to the increasing need to cut back in the current economic situation, board members asked the staff to paint a picture of what the budget would look like with no increase in groundwater charges. The budget that will be presented Monday assumes there will be no increase in water charges, and adds another $5 million in budget reductions.
“The board is leaning heavily toward no increase,” said board Chair Sig Sanchez. “With the economy the way it is the board recognized this is a year we should not raise water rates.”
Currently the groundwater extraction charge for South County is $275 per acre foot. An acre foot is enough water to supply a family of five for one year.
The $305 million 2009-2010 budget the staff will present Monday also assumes the groundwater charges stay the same, and that revenue from those charges will be lower in the coming year as customers use less water due to a call for mandatory conservation approved in March. The adopted budget for the current year was $411 million.
District Chief Financial Officer Deborah McClain said staff “left no stone unturned” when determining where to reduce expenditures.
“What we tried to do was become more efficient in what we do and how we do it, and not compromise the service we provide,” McClain said.
Most of the cuts – about $94 million worth – are in the district’s water utility fund, and are largely related to the postponement of certain projects and maintenance of infrastructure. Budget Services Officer Ron Mayorga said many of those projects can be deferred because they are only in the planning stages. But because they will eventually reach the more expensive construction phase, the cuts are not necessarily permanent, he said.
The remaining cuts, in district operations, will be ongoing into future years, McClain said.
These include eliminating 29 staff positions that are already vacant but would have been funded if the board had not asked for more cuts. Plus, the staff salary increase in the upcoming year will be reduced from 3.3 percent to 1.2 percent, according to Senior Project Manager Darin Taylor.
Other operations cuts are reductions of the staff cell phone budget by half, streamlining the district’s auto fleet by 25 vehicles, and reductions in temporary help, interns, consultants, travel and training budgets. The total operations cuts are expected to save about $8 million next year.
District spokeswoman Susan Siravo added that the board might have to make more cuts after the budget is adopted as it is possible that the state, facing a $24 billion deficit going into next year, might take money from the SCVWD. “That’s not reflected in this budget,” Siravo said.
The SCVWD serves about 1.7 million customers and currently employs about 800 people.
Monday’s meeting starts at 9:30 a.m., and will take place at district headquarters at 5750 Almaden Expressway in San Jose.
