Board Meeting - February 27, 2008

February 27, 2008
Contact: Ron Nelson
(530) 273-6185
Or: Dave Carter
(530) 265-NEWS

FOR IMMEDIATE RELEASE:

GRASS VALLEY - Following a public hearing on Wednesday (Feb. 27), the Nevada Irrigation District Board of Directors approved the noticed water rate adjustments for 2008, effective Mar. 1.
Actual rate increases for customers will vary, ranging from zero to about 15 percent, depending on type of water use. The district’s smallest and largest irrigation water customers will see higher increases as part of a rate restructuring designed to bring more equity to rates and comply with mandates of state Prop. 218.
Under terms of Prop. 218, NID conducted what is likely the largest public outreach program in its history. The outreach included letters to more than 25,000 water users and property owners, public informational meetings, publicity and newspaper advertising.
Fourteen speakers addressed the board during Wednesday’s public hearing. Several of those expressing concern were Nevada and Placer county ranchers who buy large quantities of irrigation water.
The rate adjustment and restructuring schedule has been in the works since last July and is part of an overall 10-year financial master plan designed to meet the district’s costs for operation, maintenance and capital improvement.
Directors considered adopting a phased five-year package of water rate increases, with annual review, but after hearing public testimony, adopted the increase only for 2008 and voted that if 2009 increases are considered, they would again be subject to a large-scale public notification process.
The district has been working toward the rate restructuring since cost analysis studies last year indicated that water rates are covering less than 60 percent of the district’s costs in delivering treated water and just 44 percent of costs in supplying irrigation water. Rates have been offset by property tax revenues, interest earnings and other revenues.
The NID board has gradually increased rates over the years, with an average 2.99 percent annual increase since 1997.
Even with the increases, NID’s water rates will remain among the lowest in the region, according to information presented by NID’s financial staff and consultants.
A majority of NID customers who use piped, treated water will see increases between 4 and 8 percent. A typical customer with a 5/8-inch meter using 10 hcf (hundred cubic feet) of water monthly would see an increase of $1.47 or 5.5 percent. A moderate to high use customer using 25 hcf monthly would see a $4.26 rise from $44.99 to $49.25.
Restructuring of raw water rates brings no impacts for customers using between 1.5 and 12 miner’s inches of seasonal irrigation water. Customers on each end of the rate schedule will see increases ranging to 14.6 percent, with the exception of the smallest irrigation service, 1/4-miner’s inch, which will increase by 26.3 percent to $300.19 for the six-month irrigation season.
The raw water rate adjustments were passed on a 3-2 vote of the board with directors R. Paul Williams and Scott Miller opposed, Board President George Leipzig reminded the board that the increases could be revisited at any time, should unforeseen conditions arise.
The treated water adjustments were approved on a 3-1-1 vote with Williams opposed and Miller abstaining.

In other business, directors:

voted to participate in the Mother Lode Energy Watch program, which is sponsored by PG&E. District officials are hopeful the program will help reduce the district’s energy consumption.
voted to retain the Black & Veatch Corp. for $210,000 to analyze alternatives for improvements to the Combie Phase I Canal system, which supplies raw water to wide areas of Nevada and Placer counties.
approved the Loma Rica Transmission Main Pipeline Project, which will run from the Loma Rica Water Treatment Plant near the Nevada County Air Park to Brunswick Road. The project is budgeted at $1.2 million.

The next regular meeting of the NID Board of Directors will be held at 9 a.m. on Mar. 12 at the NID Business Center in Grass Valley. NID board meetings are open to the public.