The compromise that was crafted on the dais was the right move for Davis. The city could not move forward with the project as the rates were currently structured.
Mayor Pro Tem Rochelle Swanson said to those leaders of Woodland, “We didn’t do the things that you did,” referring to rate studies and public outreach.
“I can’t support a rate going [up] that doesn’t have a rate study behind it,” the Mayor Pro Tem said. “That was a mistake, I regret not sticking to my guns in September and only doing the one year.”
She said that, while she was not opposed to a June vote, “I would hate to see a June vote be about a rate structure that is clearly untenable.”
At issue is not only studying and determining the appropriate rate levels, tiering and impacts on the community, but also reevaluating the confusing 14% rate increase that really was not. People needed to have a very real idea of what the water rates would be under this project.
Joe Krovoza also admitted mistakes, acknowledging, “We didn’t do a good job of communication – it was confusing.”
But the mistakes were more than just that. The Prop 218 process, despite the best efforts of the council to make it fair, still left a lot of people feeling disenfranchised, such as the 300 residents of Rancho Yolo who would be hit by the rate hikes, but since they do not own their own land, they could not participate.
“I also believe that this community sooner or later wants and deserves a vote on this project,” Mayor Krovoza said.
The compromise that was arrived at is not perfect. It has some flaws that I think need to be addressed. There will be the opportunity, I think, to do that when the city staff comes back with the proposed initiative in mid-January, as directed by the vote of council on Tuesday night.
Both Rochelle Swanson and Dan Wolk argued that any vote in June would need to have specific rates that people could vote to support or oppose.
“I would need to have [assurance] that it’s concrete,” Ms. Swanson said. “If somebody votes yes for the surface water project, they are also saying my rates are going up by a specific rate and whatever the structure is with that, so that folks truly know what they will be paying if they support the water project.”
“They would also be approving a rate so that when this is done, they know what they are getting into,” she added.
We do not disagree, either, with Sue Greenwald’s argument that even if we do a rate study, the rate estimates are just estimates, until the city actually gets a bid and takes out bonds.
“It’s illogical, we have no idea what the project is really going to cost. These are the roughest estimates out there.” She added, “We don’t know what the water rates are going to be until we know what the two projects are going to cost.”
“We’re going to have to pay whatever it costs to pay off the bonds that we’re going to issue,” she stated.
While we agree on that point, we do not see how we can move forward with the planning without estimates, at least, then hopefully downwardly revising those estimates after the project begins.
Moreover, I think there needs to be a debate over when the election should occur. I understand the urgency expressed by Mayor Krovoza and Councilmember Stephen Souza, both undoubtedly responding to what the leaders from Woodland were telling them about timing – we will get to the Woodland issue shortly, but while timing is important, getting it right is more important.
Considering that we have to do a proper rate study and considering that council elections are in June, June may not be the appropriate time to have a vote on this issue.
Dan Wolk expressed concerns that such timing would lead to the council election becoming a referendum on the water issue, which will detract from the importance of the budget.
“I am not in favor of an election in June, because while this issue is incredibly important, I think that we are much more than one issue,” Councilmember Sue Greenwald said. “There’re so many big issues in front of us, I don’t think we should make a circus out of June.”
The council should consider the possibility of a November initiative on water, rather than June.
We have suggested in previous columns the idea of pushing the parks tax back to November, but putting the water in November might make more sense, as the council candidates could then campaign for the parks tax for June, much as they did for the sales tax renewal in 2010.
Yesterday we took issue with the tone and audacity of Woodland to have their five councilmembers and one supervisor come to the Davis council chambers to not only lobby but also berate Davis.
At the same time, we understand that, while Davis has to the right thing for Davis, Woodland has to do what they see as the right thing for Woodland.
Woodland Mayor Art Pimentel told the Bee that they believe they can move forward on their own. We remain skeptical about this and believe that ultimately the path of both cities rests together, but that will require a bit more patience on the part of Woodland than we saw on Tuesday.
The Bee quoted Woodland Councilmember Tom Stallard saying: “Quite honestly, I’m not sure of all the implications. I sense there’s a lot of support in Davis for the transition to surface water. But I heard a lot of frustration with the process.”
He added that it appears that the city will circle back in order to address that frustration. That is a fair assessment of where things stand.
West Yost Associates believes a one-year delay could add more than $17 million to project costs, but West Yost is not exactly a neutral bystander in this process. Moreover, $17 million in a $350 million project is not a huge cost to make sure that they get this right and have public support.
Meanwhile, Mayor Pimentel called the Davis actions “a bit frustrating.”
He told the Bee, “The city could go ahead and study this for another generation if they want. But the city of Woodland needs to do what we have to do … with or without the city of Davis.”
We do not disagree with the Mayor there.
The Woodland Daily Democrat wrote this morning, “Woodland City Council members say the picture is even grimmer if the ballot stops Davis’ funding. In that case, they say Woodland may be forced to shoulder all the project costs themselves, which would mean taking on Davis’ share of the cost as well as potentially losing more grant funding, taking on more delays and otherwise seeing the project cost balloon.”
As we have argued repeatedly, there have been a series of mistakes that have been made, leading to the referendum. Past Davis City Councils failed to sell the public on this project, they failed to do a rate study, and they failed to release real numbers on rate increases prior to the Proposition 218 process that began earlier this summer. There is a Water Advisory Committee that is meeting for the first time, tonight. And council did not ramp up rates leading up to the commencement of the project.
The result is that the Davis City Council had no choice but to do what they did on Tuesday night. This was not a kicking the can down the road, but rather an exercise in due diligence, granted, due diligence that should have been done five years ago or, at worst, two or three years ago, but due diligence nonetheless.
I understand why Woodland is frustrated, but they need to hang in there.
—David M. Greenwald reporting
[quote]Dan Wolk expressed concerns that such timing would lead to the council election becoming a referendum on the water issue which will detract from the importance of the budget.
“I am not in favor of an election in June, because while this issue is incredibly important, I think that we are much more than one issue,” Councilmember Sue Greenwald said. “There’re so many big issues in front us, I don’t think we should make a circus out of June.”[/quote]
So in other words put this issue off to November for political reasons? How about keeping it on the June ballot for financial reasons and the good of the community?
“So in other words put this issue off to November for political reasons?”
Political reasons matter first of all. But that was not the sum total of my reasoning. Are six months going to matter really for financial reasons and the good of the community? What if the referendum loses because it was put on too soon or because it got caught up in council politics? How will that impact financial reasons and the good of the community?
[quote]The result is that the Davis City Council had no choice but to do what they did on Tuesday night. This was not a kicking the can down the road, but rather an exercise in due diligence, granted due diligence that should have been done five years ago or at worst two or three years, but due diligence nonetheless.[/quote]
No matter how you slice it, this was “kicking the can down the road” and will have definite repercussions. I have no doubt it will add costs to the project (if nothing else, the cost of a rate increase study). Anyone who thinks otherwise is living in an alternate universe. However, I will agree that a full rate study should have/should be done, if nothing else, to have a specific document to point to that details the rationale of the proposed rate increases that speaks with one voice.
Two points Elaine, first, we have to do things right. Second, it may cost less to do it right now rather than have put those rates up for a vote to most likely lose in June.
[quote]At the same time, we understand that while Davis has to the right thing for Davis, Woodland has to do what they see as the right thing for Woodland.
Woodland Mayor Art Pimentel told the Bee that they believe they can move forward on their own. We remain skeptical about this and believe that ultimately the path of both cities rests together, but that will require a bit more patience on the part of Woodland than we saw on Tuesday.[/quote]
The Vanguard can remain “skeptical” all it wants. But Woodland has made it clear that they will move forward with the project on their own if necessary. They have a very specific back up plan in such an eventuality and will build a much smaller capacity plant (20mgd versus the planned 52mgd; will leave out/delay/move certain structures). The Davis public needs to understand this, and not be misled by claims of “skepticism” that are based on nothing more than conjecture with absolutely no facts to back it up. I would urge the Vanguard to interview Project Manager Diemer on this issue…
I for one, think that June is a great time to consider the referendum, AND the three candidates, AND city budget issues. They are all related.
(meant, “candidates, three of whom are part of the Council that have been involved.”)
“But Woodland has made it clear that they will move forward with the project on their own if necessary. “
The question is really when it become necessary because as the Woodland article makes very clear, it would drive up the costs tremendously for woodland far more than just the $17 million.
[quote]…there is a Water Advisory Committee that is meeting for the first time, tonight…[/quote]
What does this have to do with anything, since the Vanguard has already declared they trust no conclusion the Water Advisory Committee will come up with since they consider the committee to be stacked with proponents?
Sorry to sound so harsh, but the Vanguard is all over the place on this issue, with very little in the way of facts to support any of its positions. Now it is calling for an even longer delay. How long a delay is the Vanguard really calling for? Because there will always be a school parcel tax on the horizon; there will always be doubts about this project of some sort; there will always be an economy that is less than ideal, etc. As the Mayor pointed out, at some point the citizens need to be allowed to vote on the surface water project, and the sooner the better. Delay does nothing but add huge costs onto this project. If the voters don’t want the project, then let them vote it down period and the city can get going on an alternative plan that is probably going to be even more costly. To dither indefinitely is just causing the cash register to keep going $$$ ka-ching !
“What does this have to do with anything, since the Vanguard has already declared they trust no conclusion the Water Advisory Committee will come up with since they consider the committee to be stacked with proponents?”
We never opposed the idea of having the WAC, in fact it was quite necessary and should have been in place a while ago, just the composition of it.
[quote]Two points Elaine, first, we have to do things right. Second, it may cost less to do it right now rather than have put those rates up for a vote to most likely lose in June.[/quote]
There is a huge assumption here by the Vanguard – that the voters will vote down the surface water project. You don’t know that.
[quote]Political reasons matter first of all.[/quote]
Matters to the candidates, not the citizens.
[quote]I for one, think that June is a great time to consider the referendum, AND the three candidates, AND city budget issues. They are all related.[/quote]
Amen
[quote]Two points Elaine, first, we have to do things right. Second, it may cost less to do it right now rather than have put those rates up for a vote to most likely lose in June.[/quote]
There you go again, assuming you know what is in the voters’ collective minds… did you do a scientific poll to see what way the voters are likely to vote? All five CC members agree we need the surface water project. Between now and June I expect a lot of educating of the public to go on as well. Education that will debunk a lot of the hysteria that has been ginned up by various opponents that has no basis in fact, as well as a serious discussion of the consequences of inordinent/continual delays.
“Between now and June I expect a lot of educating of the public to go on as well. Education that will debunk a lot of the hysteria that has been ginned up by various opponents that has no basis in fact, as well as a serious discussion of the consequences of inordinent/continual delays.”
Possible translation: That $300,000 for the PR firm will be put to work.
Speaking of education, I’m glad the public got educated about the supposed 14% increase.
“There is a huge assumption here by the Vanguard – that the voters will vote down the surface water project. You don’t know that.”
It’s a prediction. But more importantly, it’s something that has to weigh into the calculation of cost. Your argument is that the council action will kick the can down the road and drive up costs. It may. But the council action was the middle ground on this. The potential is there that if the voters oppose the project, I think the past rates would have lost and a better set of rates could win, and that would actually increase costs even more than the middle ground. You are correct that we don’t know that for sure, but I think the middle ground is the less risky and costly alternative.
“Matters to the candidates, not the citizens. “
It matters for public policy on a whole range of issue. If people are angry enough, you could end up with a new council majority that opposes water rate hikes – then what? Is that likely? Perhaps not. But you are being a bit naive if you really believe that politics do not matter for public policy.
“Education that will debunk a lot of the hysteria that has been ginned up by various opponents that has no basis in fact, as well as a serious discussion of the consequences of inordinent/continual delays. “
But the hysteria is not what is driving this. What ‘s driving this is the perceived lack of public process (flawed 218), the lack of a reasonable rate structure, and the convoluted 14% figure. I don’t think education makes those issues go away.
[quote]I don’t think education makes those issues go away. [/quote]If you are correct, there is absolutely no reason to delay the vote beyond June.
[quote]If you are correct, there is absolutely no reason to delay the vote beyond June.[/quote]
Bingo!
[quote]We never opposed the idea of having the WAC, in fact it was quite necessary and should have been in place a while ago, just the composition of it.[/quote]
Again, I don’t mean to sound harsh, but I consider that answer disingenuous at best. If you doubt the composition of the committee before it has even had an opportunity to meet, then you will always feel free to dismiss anything and everything that comes out of the committee, so the committee in the Vanguard’s eyes is effectively useless, no?
[quote]Speaking of education, I’m glad the public got educated about the supposed 14% increase.[/quote]
The irony here is that the citizens who came together to get the water rates increases decreased from 28% to 14% were/are being vilified for their efforts. Would you have preferred the rates increases to stay at 28%? At least give the informal advisory committee some praise for at least making the effort to engage the Dept of Public Works on the issue and do something about lowering the rates…
David
” But the hysteria is not what is driving this. What ‘s driving this is the perceived lack of public process (flawed 218), the lack of a reasonable rate structure, and the convoluted 14% figure. I don’t think education makes those issues go away.”
I hope that you are right on this. I feel that at least some of the referendum signatures were obtained by stirring up if not hysteria, at least undue angst and by the provision of misinformation. One example. The very young, personable and paid signature gatherer at Central Park used these terms to me 1) put forward without any research, referring to the surface water project. He looked genuinely amazed when I told him the process had been going on for 10+ years. 2) “snuck past the public” I had to agree that as a Sacramento student it had probably escaped his attention, but that there has been much public discussion of this issue 3) ” public officials lying” completely unsubstantiated but potentially anxiety producing 4) ” undemocratic”…. From previous posts, I’m sure you all know I have a very different view of representative vs direct democracy.
Education of the public is very important. But if an individual is still uneducated on this issue, it is solely their own responsibility. Not that of the CC, the Enterprise, the Vanguard or anyone else. I say this as someone who has come very late to this issue by my own choice. Now I am playing catch up, also by my own choice. Also, one cannot ignore the point that no amount of education or facts will deter those whose stated goal is to defeat the project at all costs.
Well said medwoman!
As Dan Wolk said, we have to consider other issues, including the city budget. I hope people think twice about the wisdom of putting a water project initiative on the ballot along with our absolutely essential parks tax, which, if one is to take the school board polling information seriously, will already need all of the help it can get.
Sue, do you think this project can get properly vetted in only 6 months?
[quote]West Yost Associates believes a one-year delay could add more than $17 million to project costs, but West Yost is not exactly a neutral bystander in this process. Moreover, $17 million in a $350 million project is not a huge cost to make sure that they get this right and have public support.–[b]David Greenwald[/b][/quote]With all due respect, those cost estimates were wildly speculative and based on biased assumptions. I was taken aback by the methodology. A five year delay would cost $131 million? Come on. They didn’t even look at the fact that we save $10 million in interest every year we delay the project, or that there is no federal funding available now and there might be in the future, or that we only have one bidder now who is not associated with controversy and that we might be able to get better bids using a different approach, or that construction costs could go down.
[i]I hope that you are right on this. I feel that at least some of the referendum signatures were obtained by stirring up if not hysteria, at least undue angst and by the provision of misinformation.[/i]
medwoman – I would take it one step further -without the hysteria and false accusations regarding Woodland’s financial capacity, blocking allegations, lack of democracy, etc, – the referendum would have failed. It only passed by approximately 100 votes anyway with the misinformation.
[i]They didn’t even look at the fact that we save $10 million in interest every year we delay the project[/i]
Sue – deferral is not equal to savings. We will incur the interest expense whenever the project happens. There is at least an equal chance that rates will be higher rather than lower in the future.
IMO, construction costs for the same plant will not go down. Only if we are allowed to build a less substantive facility will the cost go down. The costs of labor, materials and environmental impact studies and review will likely only go up.
[quote]“We’re going to have to pay whatever it costs to pay off the bonds that we’re going to issue,” she stated. While we agree on that point, we do not see how we can move forward with the planning without estimates, at least, then hopefully downwardly revising those estimates after the project begins.— David Greenwald[/quote]The point I was trying to make, David, is that the rates could be much higher, as well as lower, when we the final price comes down, and if the bonds are already distributed, there will be no choice but to raise rates regardless of voter desire, since the alternative will be default. We can’t set a “maximum rate” because the necessary rate could be much higher.
That is why I think we need to get further along in the cost determination before making a commitment. On the one hand, the JPA says that we must do the project now, because companies are so desperate for work that prices will be low. On the other hand, they say that no one will apply because unless the city has its funding guaranteed, because the costs of applying are too high.
I don’t buy that. These companies are spending the money to apply knowing that they probably won’t get the contract anyway. The chances that voters would turn down the rates after finding out the cost is no greater than the chance that the company wouldn’t get the bid in the first place. Either way, there is an application cost with no guarantee.
With $325 million project at stake, I think we can invite the three companies produce bids before the 5 year rate increase is finalized.
According to the school district poll, we could run into trouble with the parks tax. We really need to put the parks tax on in June, so that we can get another shot in November if necessary. Also, we have always done the parks tax in June because we have all of the council candidates, which usually include many incumbents, can combine campaigning for the tax along with campaigning for their seats. We really need that tax to be renewed.
Two unrelated comments/questions.
1) Sue, do you see a way that the issue can be voted on in Nov. instead of June? If, so by what means? Is there the political support for it on the council?
2) David, I think, like almost everyone, you are a little too kind to Woodland. In fact most of those who are “kind” to Woodlanders patronize them by not beginning to hold them to as high standards of democracy, environmental quality et al. as Davis and we only have to look at the record of their council to realize their shortfalls. Take Spring Lake, as just one example, voted down by their planning board (5-0 as I recall), but approved by their Council. Among other things it is built in the 100 year flood plane. By “their” I don’t mean the people of Woodland, I mean the city council and the majority of about, let’s guess, 20% of eligible voters that actually turn out in an election if there is only a local issue on the ballot. I do not mean the other 80% or so that for one reason and another, including the Daily Democrat, just are not engaged in local politics and defer to their “betters.” I have several good friends in Woodland and I actually like many things about the place and the people and the relative absence of the social snobbery and piety that comes when one lives in a universality town almost anywhere. I have lived in them in many places in my six or so decades.
Of course I can understand their concern as I do not believe they can do it alone. That’s indeed why they showed up in such force. And David, to raise the subject yet again, are you really like Don Schor, and some or most other proponents, sanguine about the risk of Woodland defaulting? I’d love to hear your answer to that question and the related one that if, as you say, the project will impose hardship on many Davisites, may it not do on on even more Woodlanders? (Please Oslo note that for all the pomposity and rhetoric we got from the Woodland Council reps that even Dan Schor could find no evidence of an informed discussion of the water issue when I asked hum directly last week).
Finally I resented the fact that the six representatives from Woodland were allowed to speak before anyone in Davis, as well as a lot of what they said–which was wonderfully critiqued in Dunning’s column yesterday. Is this some bizarre custom in local politics or what? I see no reason why this convention should exist. Unelected people from Davis have as much right to speak before them if they got to the meeting earlier. Moreover, there is a degree to which if one allows this, in this particular case particularly, the deck gets a little bit stacked or skewed at least, especially for opponents speaking later.
[i]David, I think, like almost everyone, you are a little too kind to Woodland. In fact most of those who are “kind” to Woodlanders patronize them by not beginning to hold them to as high standards of democracy, environmental quality et al. as Davis and we only have to look at the record of their council to realize their shortfalls[/i]
I’m sorry, but I think Woodland has every right to appeal to it’s long time partner in a very expensive project to uphold it’s tentative bargain. Imagine how Davis would feel if the shoe was on the other foot.
Since Mike Harrington and his clients are threatening to put initiatives on the ballot, and could readily do so in June, it seems to me the council should put this before the voters at the earliest possible opportunity.
David: I’m a little surprised that you think that $17MM is not a lot of money, regardless of the overall cost, but I think you summarized your position well, that $17MM is not a lot to pay for getting it right and getting public support. I’d say it a bit differently. I’d say that an extra $17MM may be the price for Davis being Davis. Also, while it may be cheaper for Woodland to wait for Davis to join than to go it alone, Woodland doesn’t know whether Davis will ever join, so it needs to look at its options taking that into consideration. Given Davis being Davis,if I were Woodland, I would start on a path that would be consistent with Woodland having to go forward on its own, and then force Davis to have to pay the cost of joining at a later day, if they ever decide to do so. Can’t wait around forever for Davis. When all is said and done, I predict that Davis will still move forward, but at greater cost and hence at higher water rates. Buy hey, that just the price of Davis being Davis.
I can sympathize with Woodland’s predicament. Their pro growth at any cost policies have pushed them up against a deadline that does not exist for Davis. I am skeptical that we can solve all the technical obstacles getting between Davis voters and funding this huge project in only six months. Don’t forget that after solving the technical issues there needs to be time to educate the voters.
Voters are having problems with more than just the projected cost. There is the intake location issue (immediately downstream from major pollution sources). There is the Design, build, operate problem whereby voters are being asked to turn over their water supply to a profit motivated corporation. There is the fact that the JPA has told us there are only three companies in the U.S. capable of doing a design, build, operate to accommodate two medium sized citys, two of whom are unacceptable to Davis voters. There is the rate structure, which now seems to be dependent on a solid bid.
A presumed 17 million cost increase could well be obviated by slowing down a bit and getting the right contractor, not just putting it out there that we have 325 million to spend. Finding the right contractor, who needs the work, could half that cost!
[quote]Sue – deferral is not equal to savings. We will incur the interest expense whenever the project happens. There is at least an equal chance that rates will be higher rather than lower in the future.
–[b]Adam Smith[/b][/quote]For purposes of phasing in the two mega-projects, it is a savings because the costs will be tacked on the end–probably in 30 years, after the waste water plant has been paid off. Ideally, one would pay off one mega-project (and then those rates go down) before starting the next. That what the school district did with its Emerson Jr. High construction bond.
DMG “…critical mistakes were made in this process. …”
From my perspective, the “Christmas Coup of 2010*” was among the worst mistakes made by project proponents. The citizens of Davis STILL do not have an explanation for why the water right offer from the developer was available ONLY for December, 2010.
__________
*The Davis City Council approved the Project the week before Christmas 2010 when everyone was busy, weary, unaware, or away! Those approving the Project did not provide any explanation why the critically needed Project water right offer was available from the developer ONLY in December of 2010. Finally, December 2010 was also the last month that Councilman Saylor (an assured third vote), was available to approve the Project.
[quote]‘m sorry, but I think Woodland has every right to appeal to it’s long time partner in a very expensive project to uphold it’s tentative bargain. Imagine how Davis would feel if the shoe was on the other foot.—–[b]Adam Smith[/b][/quote]Actually, the shoe was on the other foot, Adam. The University was partnering with Davis, and then just pulled out. We said nothing at all to them about it. In fact, we offered them a full participating but non voting JPA directorate (I don’t know why we did that and they wisely declined, unlike the county) and we even (unwisely) hired a University attorney to represent us in the Conaway deal.
I dont know what the Woodland City Council hoped to accomplish by all gathering by design in one room, and discuss one issue. (Are they allowed to do that??)
The Davis CC only had two options: repeal the 9/6 rate ordinance, or put the ordinance to a vote in June 2012. Either option was not exactly proceeding with immediate funding; the Davis CC could not simply allow the funding to go forward this week.
Maybe they hoped that the Davis CC would go with the City Attorney’s recommendation and vote to ignore the referendum? Crazy if true.
This Woodland CC is the same one that allowed the I-5/Rood 102 shopping megaplex, while letting its downtown and existing Mall slide further downhill towards more vacant store fronts?
It was surreal to watch those 5 Woodland CC members at the Davis podium. They made themselves look desperate? But wait, Council members Dottie and Marbles assured us at the summer Water Forum meeting that they were fully solvent and capable and ready to proceed, Davis or not? Sure. Nancy Price has informed us in this very medium that in the past couple of years Woodland shut off thousands of poor customers for lack of payment. Can you imagine? In that small town, all those people were trying to live in homes with no water?? Watch what is going to happen when they raise their rates again next year.
Frankly, in this rush to approve the surface water plant, I saw the same mentality on our Davis CC that I heard when those Woodlanders came to the podium. Now, I can understand that coming from Steve Souza, given his nearly 100% voting history on the CC for any and all urban sprawl and development projects.
[quote]“We didn’t do the things that you did” – Rochelle Swanson, 12/6/2011[/quote]But Davis did something that Woodland hasn’t done yet: put the full anticipated rate increases in before the ratepayers (albeit in a most obfuscated fashion).
That’s right, Woodland has not yet gone through the Prop 218 process for the second rate increase needed to fund their share of the project (with or without Davis participation).[quote]“[Martie Dote] said [b]Woodland already had one Prop. 218 notice[/b] providing for a good amount of the revenues it needs. She then indicated the city would have [b]another Prop. 218 notice next year to fulfill its revenue generation responsibilities to entirely uphold its financial end of the project.[/b]” – Alan Pryor’s Op Ed, 10/14/2011[/quote]I wonder how Woodland’s second Prop 218 rate increase notice will be received by the ratepayers?
[quote]But Davis did something that Woodland hasn’t done yet: put the full anticipated rate increases in before the ratepayers (albeit in a most obfuscated fashion).[/quote]I should add that the “full anticipated rate increases” were, of course, only [i]estimates[/i] based on a set of assumptions, including the cost of the project. The history of public works project budget overruns would suggests that the actual project costs could necessitate additional rate hikes.
In each post (where he denigrates people who dared to come speak during public comment about an issue that has an impact of the people that they represent) Mike Harrington ties this water project to urban sprawl, shopping megaplexes, and, amazingly, homeowners forced to live in homes without running water. The misinformation continues. The only result that Mike will be happy with is no water project and therefore no development. That is probably what his clients are paying him to champion. Correct me if I’m wrong, but I seem to remember Mike supporting a housing development along Hwy 113 just north of Davis while he was on the City Council and campaigning for the Wild Horse Ranch housing development.
[i]Nancy Price has informed us in this very medium that in the past couple of years Woodland shut off thousands of poor customers for lack of payment.[/i]
Nancy, can you verify this statement by Michael Harrington, that you made this assertion and that it is factual?
[quote]Of course I can understand their concern as I do not believe they can do it alone. That’s indeed why they showed up in such force. And David, to raise the subject yet again, are you really like Don Schor, and some or most other proponents, sanguine about the risk of Woodland defaulting? I’d love to hear your answer to that question and the related one that if, as you say, the project will impose hardship on many Davisites, may it not do on on even more Woodlanders? (Please Oslo note that for all the pomposity and rhetoric we got from the Woodland Council reps that even Dan Schor could find no evidence of an informed discussion of the water issue when I asked hum directly last week). [/quote]
You don’t seem to understand the basic issues here. Woodland has NO CHOICE but to go it alone if Davis delays. Woodland is already getting fined for failure to come into compliance with water quality standards, standards which are only going to get more rigorous. Woodland CANNOT AFFORD to not do the project, bc the SWRCB has made it clear no community will be allowed to gain financially from a failure to come into compliance with the new water quality standards. For Woodland it is a question of pay for construction/financing costs now or pay for steep fines with nothing to show for it – BUT PAY THEY MUST. The same will be true for Davis in the not too distant future (2017)…
[quote]Nancy Price has informed us in this very medium that in the past couple of years Woodland shut off thousands of poor customers for lack of payment. [/quote]
Proof? Or is this more hysteria being ginned up?
Random questions:
Is it possible to hold a special election prior to June to settle this debate? After the time and effort that has already been expended on this project, is there really a lot more to learn? I remember the Target issue; all the squeaky wheels were opposed, but when the vote was taken, the city supported the view of the CC. I suspect that would happen again, and if not, then both cities could begin to explore other independent options without wasting half a year.
Does the law require that the project be funded solely by the sale of water? Other infrastructure projects, like roads, are funded from general revenues, not just by the people who drive on them. I don’t know if an alternate tax would be more acceptable to the residents of the city, but a small percentage in the sales tax may be more acceptable than “tripling my water rates” even if the amount were the same.
I think all concerned would be better served by a timely resolution of the issue as opposed to “kicking the can” down the road 6 months or a year.
Can anybody here explain why Woodland seems to be looking at Water Quality fines at a much earlier date than Davis? I also remember Sue saying that selenium requirements were lower for Woodland than for Davis. How come?
I sympathize with Woodlands predicament, watching the clock tick down to fine time. I understand why they feel the need to pressure Davis to go along on this $325 million rush job. But there remain a ton of issues that Davis voters are not comfortable with and that need to be ironed out before many are willing to sign on to this huge expenditure.
As I understand it there needs to be a solid bid before any rate scheduling can occur. Right now we have only three candidates, two of which do not pass the smell test. The JPA has told us that there are only three companies in this entire country who have the resources to take on this joint project to provide surface water for two medium size cities. I’m sorry, but that statement also fails the smell test. We need to take the time to properly vet potential contractors. We need to reconsider the entire Design,Build,Operate approach. Many communities that have bought into allowing a for-profit corporation take control of their water supply are trying desperately to regain control of this public resource.
Then there is the problem that intake location, as currently planned is directly downstream from major sources of pollution. I for one am not particularly interested in paying to clean agricultural pesticides and herbicides out of my drinking water. And many prescription drugs, including hormone mimickers that cause infertility in high concentrations, are not removable from drinking water with current technologies.
A comprehensive water study, required in the Swanson/Wolk motion, will take time. Done properly the study should take more time than the six months between now and June.
Sorry Woodland, but however you got yourself into your current predicament, please don’t expect Davis ratepayers to rush ahead and spend millions without due diligence, to bail you out. Davis and Woodland can partner on this huge investment to our mutual advantage, but please don’t think that we are willing to rush into this thing, perhaps spending millions unnecessarily, to meet your deadline. Good work takes time.
Steve Hayes: “From my perspective, the “Christmas Coup of 2010*” was among the worst mistakes made by project proponents. The citizens of Davis STILL do not have an explanation for why the water right offer from the developer was available ONLY for December, 2010.”
The explanation was given nearly a year ago by WDCWA legal counsel during the public hearing that Tsakopoulos’ legal counsel had informed him that they only had until the end of the year to close on the purchase of Conaway Ranch, as that was when the deal was set to expire with the sellers. Tsakopoulos apparently wasn’t willing or able to purchase the Conaway Ranch unless the deal with the cities was in place. So, the WDCWA and the cities had to decide whether they were willing to enter into the agreement to purchase the water rights or let the opportunity pass with Tsakopoulos and hope that another better opportunity with Tsakopoulos or someone else would materialize for the cities in the future. Often in real life you have to make a decision with less than perfect information and/or decide to delay the decision and hope that the cost is not significantly greater or that the opportunity is not completely lost because of the delay. The two cities made that decision at the end of 2010 to buy the water rights. Davis is unwilling to move forward on the overall surface water project at this time without further time being take for analysis – largely because of fear of political fall-out for not doing so, rather than because the councilmembers really believe that it is the best decision for the city economically, in my opinion. It is interesting that over the course of the nearly a year since the deal was made with Tsakopoulos that I haven’t heard of any new information coming to light where someone has said “had we known such and such, we wouldn’t have made that deal with Tsakopoulos”. I’m curious, did you think that the deal shouldn’t have been made a year ago, or just upset about having to make a decision so quickly? What new information have you learned since then that would have been relevant to that decision? Would you make the deal today? Sue Greenwald was highly critical of the timing a year ago, as well. I’d be curious to know if Sue thinks in retrospect that the deal still shouldn’t have been done, or has come to believe that it was a good deal for the cities. (Sue?)
roger: [i] I also remember Sue saying that selenium requirements were lower for Woodland than for Davis. How come? [/i]
Woodland’s target selenium requirement is 3.2; ours is 4.4 (I think). My recollection is that is because their discharge permit is newer than ours. Davis discharge permit comes up for renewal in 2012. At that time new selenium target requirements for Davis will be set. I would be willing to bet ours will be lower on the next discharge permit. The board then sets acceptable current limits if there is a plan in place to achieve the target level.
[i]A comprehensive water study, required in the Swanson/Wolk motion, will take time. Done properly the study should take more time than the six months between now and June. [/i]
Comprehensive studies have been done. Alternatives have been listed and costs have been estimated for them. [url]http://www.wdcwa.com/images/uploadsdoc/Summary_of_Alts_for_DWWSP_051310_with_Cover.pdf[/url]
I am curious what general questions you have that you feel have not been studied?
[i]Sorry Woodland, but however you got yourself into your current predicament[/i]
Davis is in the same predicament.
[i]”Sorry Woodland, but however you got yourself into your current predicament, please don’t expect Davis ratepayers to rush ahead and spend millions without due diligence, to bail you out. Davis and Woodland can partner on this huge investment to our mutual advantage, but please don’t think that we are willing to rush into this thing, perhaps spending millions unnecessarily, to meet your deadline. Good work takes time.”[/i]
Read: Woodland, you are dumber than us Davisites. Sorry.
I have another take…
Read: Woodland, you are stuck being married to a bitch. Sorry.
Regarding our selenium limit: I was told it is final, but I didn’t inquire in depth.
I am not knowledgeable about Woodland’s selenium situation, but it is possible that they have not dug as many deep aquifer wells as we have (just a guess)(and Don — replacing shallow aquifer wells with deep ones shouldn’t increase subsidence, I would think). We’ve done a great job with our deep aquifer wells. When I first moved to Davis in 1987, our bathtub had a strange grey mineral coating on it that was impossible to remove. I have not had any such problem for many years. Diane Jensen at public works explained to me that this is because the newer deep aquifer wells have greatly decreased hardness (and have no detectable selenium). In fact, Bob Clarke said that the salinity levels of our deepest wells overlaps with the salinity levels of Sacramento River water.
[b]newshoundpm:[/b]I believed then, and I believe now, that we should not have purchased the Conaway water without a guarantee that Mr. Tsakopoulas would guarantee funding Conaway’s share of the intake, at a minimum.
I suggest we follow Sue’s recommendation to delay the project resulting in $10 million p.a. in savings. In 16 years the project will be free.
DT Businessman aka Michael Bisch
That will certainly prove how much smarter we are than the Woodlanders. Our project is free while they pay through the wazoo for theirs. “Money for nothing and the chicks for free.”
DT Businessman aka Michael Bisch
Sue Greenwald said . . .
[i]”Regarding our selenium limit: I was told it is final, but I didn’t inquire in depth.”[/i]
Sue, if you check with the Bay Delta Plan you will see that the target Selenium level promulgated there is for all jurisdictions to be at a level less than 1.0. 4.4 is far from our “final” number.
I have submitted a Public Information request to the SWRCB to get all the Selenium and salinity limits for all the jurisdictions in the State as well as their permit start and end dates. Armed with that data we will be able to see the trend that the SWRCB/RWRCB limits have been following over time as new permits have been issued. I expect there will be a consistent downward trend with Davis’ current 4.4 and Woodland’s current 3.2 showing up as “normal” points in time along a downward sloping curve.
I also think David is on to something. The project is far too costly for Woodland to go it alone. If we dither long enough, Woodland will eventually pay us to join them. We can delay and stall 16 years and actually make money from the project. This is getting better and better.
DT Businessman aka Michael Bisch
Sue: [i]”I am not knowledgeable about Woodland’s selenium situation, but it is possible that they have not dug as many deep aquifer wells as we have (just a guess)”
[/i]
Woodland has been drilling deeper wells, but they have encountered the same problem we may run into.
“This deeper well has provided proper blending among the groundwater zones within the well to lower the salt level. Use of deeper well water zones has it limits too because the deeper water has manganese, arsenic and other minerals that are also regulated. There is a delicate balance of not using too much shallower water (to avoid salt and nitrates) and not using too much deep water (to avoid manganese, arsenic and other minerals).”
— Sept. 2010 report to the Woodland City Council.
I really don’t think you’ve fully explored all the complications of the deep aquifer proposal you are advocating.
I also think Ernie Head is on to something. His initiative caps operational cost by restricting rate increases to the cost of living. But why stop there? We should reduce rates annualy by 5%, no 10%, that way operational costs will decrease every year. In 16 years we’ll have a free surface water project that actually generates cashflow for the community. “Now that ain’t working. That’s the way you do it.”
DT Businessman aka Michael Bisch
@Don Shor: As I have explained, I don’t have a “deep aquifer” proposal. I am beginning to understand our effluent situation utilizing the current aquifers that are in place, completed and on line, and far along in the implementation process, and so is staff. Our effluent quality will not be in particularly bad shape, so it is quite possible that we could phase in the project if we wanted to. Note that I said “possible”. Given the stakes, I think it would be wise to nail down the costs better and to explore the economic implications of NOT delaying the project along with everything else.
Sue –
I haven’t had all the off the record conversations on this matter that you have had, but it doesn’t make intuitive sense that the source of water would have anything to do with what the discharge limits are. For the layperson interested in making reasoned decisions, Don Shor’s explanation of that Woodland’s limits have been set more recently makes much more sense. And the fact that Woodland is already being fined, would seemed that if Davis is in violation of discharge limits, we too, will be fined.
[quote]Our effluent quality will not be in particularly bad shape, so it is quite possible that we could phase in the project if we wanted to[/quote]
[quote] I think it would be wise to… explore the economic implications of NOT delaying the project along with everything else.[/quote]
You seem to be contradicting yourself… please explain…
Sue: [i]”I don’t have a “deep aquifer” proposal”[/i]
Yes you do. You have proposed that we hold off on the surface water project for 20 – 25 years. That requires that we, at a minimum, pump from the deep aquifers at a rate — combined with the increase in UCD pumping — that is about 4x the current usage of the deep aquifer. That assumes no growth in Davis, no growth at UCD, and no impact from Woodland possibly going to deeper wells.
If we don’t go to the deep aquifer, we can’t meet the salinity and selenium standards, and subsidence continues, due to continued reliance on the intermediate aquifers.
Your proposal is, by default or by intention, to substantially increase pumping from the deep aquifer for 20 to 25 years. The city is already transitioning to that aquifer.
[quote]“Money for nothing and the chicks for free.”[/quote]Please, Mike. It’s “money for nothing and [i]your[/i] chicks for free.”
Not to go all Rifkin on you with side stories*, but Mark Knopfler explained in a 2000 interview that the lyrics of “Money for Nothing” came from the remarks of a guy standing next to him in an appliance store while facing a wall of TV screens displaying MTV:
[quote]“Aw, that ain’t workin’.”
“Them guys ain’t dumb. Maybe get a blister on your little finger, maybe get a blister on your thumb.”
“What’s that, Hawaiian noises? He’s bangin’ on the bongos like a chimpanzee.”[/quote]
Knopfler borrowed a pen in order to write down the comments, which inspired the top hit song (co-written with Sting) on the [i]Brothers in Arms[/i] CD. With that scenario in mind, the lyrics are hilarious…although at least one line is politically incorrect by current standards.
*No offense, Rich. I enjoy your side stories. They are much-needed respite from the bickering.
SG said:
“newshoundpm:I believed then, and I believe now, that we should not have purchased the Conaway water without a guarantee that Mr. Tsakopoulas would guarantee funding Conaway’s share of the intake, at a minimum.”
Sue, I didn’t realize that that was your major issue on the deal. Kind of ironic, don’t you think? Given where you and Davis are today, that probably should have been more Mr. Tsakopoulos’ concern than yours. Since you have indicated that Tsakopoulos should have guaranteed its share of the intake cost, do you know if Davis and/or the WDCWA guaranteed the funding of its share, or that if Tsakopoulos would have guaranteed his share of the intake, that Davis and/or the WDCWA would have been willng to guarantee theirs? Or, should this not go both ways?
Based upon what you have said, did you think at the time (and maybe still think now), that Davis really didn’t need surface water rights badly enough at the time (because it didn’t know whether it would go forward with the surface water project in the foreseeable future) to warrant paying what it did for them, and perhaps that it could get a similar or perhaps even better deal (but hopefully not significantly worse) for water rights in the future from someone?
If that is a reasonably accurate representation of how you were/are thinking about the situation, in the context of the overall surface water project and all of this rate stuff, when would it be appropriate to seek out these water rights, and how does the timing of these different efforts (acquisition of water rights, setting rates, deciding to bid-out a design/build or design/build/operate project) all fit together? There seem to be a number of potential chicken and egg types issues.
Also, if one doesn’t support at least a design/build project, from which you can get bids for the cost of the project construction up front, don’t you need to design something to at least a preliminary stage to get construction cost estimates? Given how long each of these steps might take, particularly the amount of time between a cost estimate to set rates and the time to fully design and bid the construction costs in a non-design build scenario, isn’t it somewhat like guessing what the price of something will be at least a year if not 2 years out?
You seem to have done much more homework on this than most, so I’d be interested in understanding your perspective. This is a complicated project and I’m not sure many if any of us (including me) have a good or even decent handle on all of this, or have even successfully thought through what the sequencing of the process should be. From your perspective, what is the right way to do all of this if everyone would listen to you? Please help!
David S., remembering song lyrics was never one of my strengths. What about my math, did I get that part right? Based on the Sue G., David G. and Ernie H. reasoning, will we have a free surface water project, with zero cost water, and a Woodland payoff if we dither and delay for 16 years?
DT Businessman aka Michael Bisch
Don Shor,
Thanks Don for the link to the abbreviated list of proposed alternatives to the current Water import project. I failed to make myself clear. When I said that the Swanson/Wolk proposal required a comprehensive water study I was referring to a comprehensive study of existing water sources in Davis, which as I understand it, has never been done. I am interested in learning the data that has justified the drive toward surface water import over the past 20 or so years.
I am hearing much about subsidence if well water continues to be used in Davis, but I have seen zero data supporting that claim. I have heard lots of claims regarding greater or lesser selenium content in wells of varying depths, but no supporting data. I have heard that U.C. Davis will quadruple well pumping, but no data to support the claim.
I have yet to see the data that supports this 20 year drive to import water to Davis. Being naturally cynical, and knowing that Don Saylor who has a record of supporting any and all growth in Davis has been a driving force behind water import, I really have to wonder weather the real impetus behind water import is to support Covell Village scale development that would otherwise not be practical. Woodland has followed that trajectory and now find themselves in the position of having to rush in to this huge project without due diligence.
Without solid data to support the conclusion that water import is absolutely necessary I am inclined not to support a tripling of my water bill. Hence the comprehensive study of existing water sources for Davis is absolutely necessary to justify support of this massive public works expenditure.
Regarding general questions that I feel have not been studied ; I heard several months ago that conjunctive use, mixing water from the river with Davis well water, in a way that provides the benefits (less corrosiveness, less alkalinity) to everybody in Davis is not possible without major reconfiguring of the City’s current plumbing system. As I understand it people in West Davis and South Davis will be paying for the higher quality conjunctive use water but receiving the same well water that they were receiving prior to voting to triple their water bills. Do you know if the City or JPA has studied this problem and how much it will add to the estimated $325 million cost of the project to remedy this problem. I see this as a major sticking point with voters, if not handled before a June vote.
Another general question that I have yet to hear addressed by the City of JPA is how in the hell did they ever come up with the Design,Build,Operate scenario as the only viable way to run this project? The media is full of stories about municipalities all over the world that chose to privatize their water resource and are now struggling mightily to recover their water supplies from corporations whose primary concern is profit for their stock holders. I thought that the primary function of municipalities is to provide the public infrastructure necessary for people to be able to live there. The difference between SMUD and PG&E rates and service should serve as a constant reminder to folks of why public resources should never be privatized.
So, bottom line, lots more homework, lots more questions before voters are willing to foot the bill. Davis is not in the same predicament as Woodland. If they want us to partner with them they are just going to have to be a little patient and wait until we are convinced that we are getting maximum bang for our buck.
@PhilColeman
Jeez, I thought i was cynical. You have got me beat by a mile.My point is not that “Woodland is dumber than Davis” I am simply pointing out that while Davis residents are asking all the right questions before they lay down their hard earned dollars, Woodland residents, for the most part, don’t even realize that their water bill is about to double. I wonder if the Woodland CC members who tried to push things along at the Davis CC will be sending out 218 notices like the ones our elected officials provided to Davis citizens. Not likely.
roger: [i]”I am hearing much about subsidence if well water continues to be used in Davis, but I have seen zero data supporting that claim. I have heard lots of claims regarding greater or lesser selenium content in wells of varying depths, but no supporting data. I have heard that U.C. Davis will quadruple well pumping, but no data to support the claim.”[/i]
1. Subsidence is occurring west of Davis and near Zamora. The rate is 1/2 to 1″ per year. I can provide the data if you like. Subsidence is being monitored as part of the groundwater management plan agreed upon by the City of Davis and UC Davis, a plan which was published in 2005.
2. Selenium content of every well is detailed in the city water quality reports. You can find them at the city web site. Or I can provide them. Selenium limits by the state water board are in the city’s discharge permit. I can provide that if you like.
3. UC Davis is not going to quadruple well pumping. Here’s how I have arrived at that quadruple calculation:
The current increase in city pumping already planned and underway is about 6400 acre-feet (a-f). UC Davis is already increasing their pumping from the deep aquifer from 2300 a-f to 5300 a-f. Combined with the added city usage, the total increase (city and UCD combined) in use of the deep aquifer is more than 4x.
I have been putting some information on thread on the new bulletin board here:
[url]http://davisvanguard.org/index.php?option=com_kunena&func=view&catid=2&id=41&Itemid=192[/url]
roger bockrath said: “Another general question that I have yet to hear addressed by the City of JPA is how in the hell did they ever come up with the Design,Build,Operate scenario as the only viable way to run this project?”
I agree with most of what you said about this. I must confess that I’ve not been following this aspect of the process too closely, but I suspect that the reason the DBO scenario is viewed more favorably by some is that it likely reduces risk. When someone agrees to do all of this for a price, they take the risk of cost overruns, so you largely know what your costs are going to be at the outset. If you separate all of these processes, particularly separating the design from the build, you won’t know how much the project will cost until design is completed and the project is bid. So, how and when do you set your rates? Bonding will undoubtedly be used to finance this project. I believe that some sort of bridge financing was planned for the initial design work. The argument has been that rate payers want to know what the project will cost before agreeing to an increased rate. So, do you undertake the design and set a rate, not really know what the construction cost will be if you do a separate process for design and build, or do you combine and likely pay a premium to know your costs up front? I’m not sure how the “operate” part fits in, other than maybe you don’t have interests aligned very well if the entity that is determining how to design and build the facility isn’t also operating it. You may be able to design and build a less expensive facilitiy that costs more to operate. You may have multiple bidders who have different design proposals. How do you decide which one is best for the city if you don’t have some comfort that they have an incentive to provide accurate operating costs, rather than to low-ball them to get the design/build work? Additionally, even if there is enough information with little design work to estimate the cost of constructing the project before the design work is done, and to set a water rate based upon it. How do you lock in that cost before the design is completed and the job is ready to be bid? I don’t know what percentage the design work will be, but it wouldn’t surprise me if it was $30 million or even $50 million. That’s a pretty large “sunk cost” to walk away from if you discover the construction cost will be significantly higher than originally estimated.
And we are going to try to get the public to understand and make informed decisions on all of this stuff? I just don’t see it happening. People will make decisions. Heck, everyone likes to make decisions. It seem undemocratic not to want to make a decision. Unfortunately, this stuff is too complicated to expect the public to get it right. That is why we are a Republic. Even with a project as important as this, I don’t have faith that the people will get it right. You may say that is being too paternalistic, but how many hours do you think one needs to spend to understand the key issues? How many people to we really think understand these key issues well enough? How many do we think will understand them in June or even November? We need to have experts that the city can trust who don’t have a stake in getting the design, build or operate contracts. How about we hire a consultant who has expertise, but who either doesn’t or won’t be eligible to do any of the design, build or operation work. Then we compensate them in part by having that compensation be tied to minimizing all of these costs for us. I’d gladly give a firm some percentage of the cost savings to make sure that their incentives are aligned with ours. What has been done in other places? This can’t be anything close to a unique situation. What are the best practices for this sort of work. I suspect that the JPA has already investigated this. Someone should dig this up for the public to review.
ERM, have you heard or seen any of this sort of stuff? Maybe you could ask at the next meeting?
You remove potential conflicts of interest by aligning interests.
newshoundpm said . . .
[i]”I must confess that I’ve not been following this aspect of the process too closely, but I suspect that the reason the DBO scenario is viewed more favorably by some is that it likely reduces risk. When someone agrees to do all of this for a price, they take the risk of cost overruns, so you largely know what your costs are going to be at the outset. If you separate all of these processes, particularly separating the design from the build, you won’t know how much the project will cost until design is completed and the project is bid.”[/i]
The DBO model is essentially a merger of Operational Outsourcing with the building of the project infrastructure. Your comment about risk is correct with respect to the interrelation between the “design” portion of the DBO project and the “building” portion of the DBO project. Of course that would be true if the DBO was scaled back to DB (with a separate bid process for the “Operate” portion).
Which begs the question, “Why consider outsourcing?” The answer to that question is very simple . . .
— First, you have to ask, [i]does either City currently have the skills (in its collective Staffs) needed to operate the kind of plant that will be built[/i]? The simple answer to that question is “No.”
— Next, because of the prior answer, you have to ask, [i]how easy is it to hire the additional employees with the requisite skills and experience needed to operate the kind of plant that will be built[/i]? The answer to that question is”Quite difficult because there is intense California-wide (and worldwide) competition for engineers with those skills. The Woodland/Davis project will be a very small project by industry standards, so engineers with experience who are looking to move up in their careers will see Woodland/Davis as a “small pond” at the same time that their career desires are for the challenges and compensation of a “bigger pond.” As a result, Woodland/Davis will be primarily looking at entry-level experience engineers, and their primary competition for those youngsters fresh from college will be the for-profit industry giants who can offer more money and a clear career path. Newly minted water engineers will mean substantially increased training costs . . . or higher frequency of plant process breakdowns, with attendant costs associated with those breakdowns
Third, as Woodland-Davis employees progress in their career paths, the opportunities for advancement and greater career challenge (and pay) will be much more limited than in the “big ponds” of larger municipalities ad/or the private sector. Therefore, employee loss rates will be substantially higher than industry averages. In essence, when a Woodland-Davis employee give his/her notice, all the investment in that employee’s education will walk out the door with him/her . . . and the the challenges and costs of hiring/training cycle described above will start once again.
On the other hand, a private firm has a whole range of customer projects to deploy its employees to. They also get considerable “leverage” out of investing in employee education, so they can afford to have formal training staff/programs to ensure that their new employees don’t solely learn on the job (with the attendant mistakes such learning includes).
Further, when an employee at “small pond” project reaches the point where his/her career path is due for greater challenges, the private firm can plan for that employees eventual transition out of the project and pre-train an existing firm employee to be the “back fill” when the promotion out of the project actually happens. The result is virtually no hiring costs associated with transition, as well as very little “knowledge loss” when the promoted employee leaves the project.
[quote]ERM, have you heard or seen any of this sort of stuff? Maybe you could ask at the next meeting? [/quote]
The Water Advisory Committee (WAC) is going to ask for all sorts of prior information/institutional knowledge, to better understand how we got here and better determine where we should be headed in the future. It will be important for citizens to follow along as the WAC wrestles with all the aspects of the proposed: surface water project/water rate increases/waste water treatment plant upgrades.
[quote]Another general question that I have yet to hear addressed by the City of JPA is how in the hell did they ever come up with the Design,Build,Operate scenario as the only viable way to run this project? The media is full of stories about municipalities all over the world that chose to privatize their water resource and are now struggling mightily to recover their water supplies from corporations whose primary concern is profit for their stock holders.[/quote]
In the Design/Build/Operate process for the proposed surface water project, the JPA would own the project, NOT the private company that designed and built the project. The private company that designed and built it would OPERATE the facility for a period of 15 years, I assume until the JPA gained the necessary expertise to run the operations themselves if that was the JPA’s desire…
Thanks Don, Elaine, and NHPM,
I think we are now moving along nicely toward resolution of many of the snags in this process. I have yet to find the time to complete all of Dons linked information, but I will soon. Right now, gotta make hay while the sun shines.
I think that the City and JPA would be well not to expect Don to do their P.R. work for them. Maybe it’s time for them to initiate a blog site where voters could inform themselves as we are doing by participating on the Vanguard. Didn’t somebody mention that the JPA has already paid out over 300,000. for P.R.? Where’s the Beef?
Matt, Thanks for sharing your insights on the DBO process. What you shared makes a tremendous amount of sense, and I’m sure that this is not widely known by the public. I’ve got to believe that staff is trying to make the best decisions for the community and have far more information than either we do, or the public.
Even though the contract is for 15 years, what sort of outs would the City / JPA have? What are some of the cons of going with the DBO option in your opinion? Once the contract is entered into, are there any likely or possible surprises for the City / JPA that one would worry about? If it is just the cost, but it is predictable, the City / JPA would know that going in.
I feel like I’m learning quite a bit on this thread. Just wish some of the other threads were as educational versus intentionally misleading and inflammatory.
newshoundpm said . . .
[i]”Even though the contract is for 15 years, what sort of outs would the City / JPA have? What are some of the cons of going with the DBO option in your opinion? Once the contract is entered into, are there any likely or possible surprises for the City / JPA that one would worry about? If it is just the cost, but it is predictable, the City / JPA would know that going in.”[/i]
Excellent question newshoundpm. Ironically it is a question that Michael Bartolic and nancy Price and I had a lively discussion about outside the Chambers after the first vote was completed on Tuesday night. Any well-done Outsourcing contract contains very specifically spelled out “Levels of Service” that define how to measure successful delivery on the terms of the contract. Said another way, “Levels of Service” language in the contract is a formalized process of expectations setting between the two contracting parties. On the one hand the Outsourcing vendor is protected against client promulgated change orders, and on the other hand the client is protected against vendor short falls in the delivery of the expected performance.
As the parties progress through the life of the contract they are constantly validating expectation vs. reality . . . contracted levels of service vs. actual performance. The contract will also spell out specific remedies if the vendor’s performance falls short of the contracted “Lecels of Service.” Those remedies go right up to termination of the contract.
Defining “Levels of Service” specific to the individual prospective client is why the process of preparing an RFP response in an Outsourcing situation is so expensive and time-consuming.
Does that help?
Yes, that helps. It seems like the toughest thing to do in such an agreement would be to cover an unexpected scenario. Say that the State required the meeting of some increased standard. The vendor would presumably propose a “change-order” for this. Would the client have the right to terminate the overall contract if it didn’t like the price, since you can have only one operator? If new capital construction were required, would also seem difficult to have someone other than the DBO firm make any modifications. Also, seems like the client could use such a situation as an excuse to “break” a long-term contract if it didn’t otherwise have outs, so vendor would seek protection from that. Seem like many opportunities to potentially game this. Would be good to better understand where the conflicts have been on such sorts of agreement from other jurisdictions historically. Again, this can’t be new ground we are treading upon. Thanks for your always helpful comments.
newshoundpm, all good questions, and some of them I don’t have experience with so, like you, I will be coming up the learning curve.
However, from my experience with Outsourcing in Information Technology, I can hazard a guess. My suspicion is that in the Water world a certain amount of standard adjustment to regulatory change is indeed included in the operational contract at no additional fee, but if the regulatory change would require capital investment in the plant regardless of who is operating the plant, then I think that that would fall under the category of an additional cost, for which bids would need o be solicited. Those bids would no doubt be only DB bids, because the O portion is already contracted for. DB only bids would be the case for the add-on regardless of who was operating the plant.
Regarding your “break” a long-term contract question, I am going to defer to Nancy Price. Based on my conversation with her and Michael Bartolic outside Chambers on Tuesday night, I think she has much more information about that than I do.
Nancy Price, are you out there to answer that question?