Commentary: Tonight Critical For Future of Water Project

Equity Chart - SFR New CBFR-12 vs CBFR-6The Vanguard has received word that, while the staff report is perhaps more limited that we would have liked, there will be a presentation this evening by Donna Lemongello and Matt Williams, putting forth an improved CBFR that eliminates the look-back mechanism, and implements a 12-month running fixed rate and “pay-as-you-go.”

There are caveats to this – the item is an informational item, and so, while the council cannot act definitively this evening as columnist Bob Dunning calls for, it can make strong recommendations and give direction to staff that this is the measure that they want the URAC (Utility Rate Advisory Committee) to consider a revised CBFR that would go to a Prop 218 vote and some believe should got to a vote of the people.

Bob Dunning this morning puts it this way: “Is the council sincerely interested in instituting a new, fairer and less confusing rate structure, or is it simply going to kick the can down the road and give lip service to ‘revisiting’ the rates at a later date?”

Clearly, Donna Lemongello and Matt Williams believe this is a way forward to improve upon the current system.

On the other hand, Mike Harrington in his Vanguard column on Sunday, sees this as an opportunity to end the Measure P debate.

He writes: “Now the No on P cadre are out telling people that yes, the rates are a mess, but don’t vote YES on P to force the City to repeal this package and adopt new, more fair, more understandable rates.  The latest story is to vote NO on P, and trust the City to go ahead and voluntarily fix them.   Agree with the No on P committee?  Then I have some great seafront property to sell you about twenty miles west of the Golden Gate Bridge.”

What is the council prepared to do? That remains to be seen.

The Enterprise last week wrote, “We ask the City Council to take definitive legal action — not just make promises — instituting the following changes, which have been drafted by a group of dedicated citizens who want to see fairness rule the day.”

“The key word here is ‘definitive.’ Not some watered-down council resolution to punt the rates to the Utility Rate Advisory Committee to study for the next six months,” Mr. Dunning writes. ”If the council does nothing definitive tonight, you’ll know this whole thing was nothing more than a ruse, a sham, a con job or any other words you can come up with that indicate deception.”

He adds, “If the council doesn’t take action, my advice is to vote ‘yes’ on P if that’s what you were already planning to do or to vote ‘no’ on P if that’s what you were already planning to do. In other words, if the council is all talk and no action, I see no reason for voters on either side of the issue to change their already well-formed positions.”

In comment to the Dunning column this morning, Elaine Roberts Musser, who chairs the committee, said, “I assure you the URAC will not take six months to study the issue as you suggest, but is prepared to act in a timely fashion, having called a special meeting for June 5. The URAC is well aware of the controversy over water rates and the compressed time frame required for decision-making. The URAC is the local gov’t body assigned the task of overseeing all city utility rates and to carefully analyze what would be the fairest for the citizens of Davis. Several members of the URAC are uniquely qualified with experience in regard to setting utility rates.”

But in a sign of the times – her comment was greeted with more skepticism. One reader responding, “Elaine, I’m so very reassured. Let me take a moment to bask in the reassurance before I go vote YES on Measure P.” Another added, “In other words….we need to calm down. OK.” Finally, another wrote, “If you guys are so incredibly bright Elaine, why couldn’t you do the fair and obviously correct thing the first time around?”

Reading the tea leaves here is difficult. But much remains on the line at this point.

In March of 2013, a divided electorate approved Measure I by a 54-46. In January of this year, a ballot initiative qualified for the ballot and the council acting on due diligence put it on the June ballot.

Many have attempted to shrug off the Measure P movement, but clearly there are concerns both on the part of the drafters of the CBFR revisions and some on the council that the issues that have presented themselves and the concerns raised by citizens will translate into votes to abort the project.

As Matt Williams noted, “Based on my extensive canvassing as part of the City Council election I have had the opportunity to talk with thousands of Davis residents, and for many of them Measure P is not about killing the project, it is about fairness, and they are not at all convinced that the rates as they currently exist are fair.”

Implicit in that statement is concern about whether Measure P will pass.

As we wrote before, I completely believe the motivation behind the efforts of Donna Lemongello and Matt Williams to fix CBFR is to make what was a more equitable rate structure than the Bartle Wells alternative even more fair.

What is less clear is how best to resolve all of this. I still believe the problems here go beyond the issue of fairness. CBFR actually produced a much more fair system than Bartle Wells and yet produces a huge amount of blowback.

What tonight will likely bring is long discussion but probably not the kind of definitive action that some want the council to take. What that will mean for Measure P and the future of the water project is largely unknown.

—David M. Greenwald reporting

About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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  1. Frankly

    Matt Williams… I need a succinct explanation of the delta. What specifically changes between the old CBFR model and this new proposal? I get the 12 month versus 6 month look back. What else am I missing?

    1. Matt Williams

      Frankly, I’m not sure what you mean by the delta, but here is an after/before look at what Donna and I are proposing for the Supply Charge portion of your water bill.

      Proposed Supply Charge

      Calculated each month as $0.22 X 12 per ccf used = $2.64 per ccf

      Current Supply Charge

      Calculated as $0.32 X 12 per ccf used = $3.84 per ccf, but
      only for the May to October months (with no charges for November through April), but
      paid for over 12 months, but
      not this year … the following year.

      We believe the proposed is an improvement. Which one would you choose?

    2. Matt Williams

      Proposed Distribution Charge

      $8.25 per month for a 3/4-inch meter (if you have a bigger meter, you have greater water capacity, and the charge will be higher.

      Current Distribution Charge

      $10.21 per month for a 3/4-inch meter (if you have a bigger meter, you have greater water capacity, and the charge will be higher.

      So for 80% plus of all the homes in Davis the delta will be a $0.96 reducton in the fixed fee each month.

      1. SODA

        Matt, forgive me but wasn’t your initial idea and argument in favor of CBFR that it took the size of the water meter out of the equation. Is this putting it back in? Thx.

        1. Matt Williams

          Good question SODA. The original “idealistic” CBFR had only two components of cost … Fixed and Variable. The Variable was 100% volumetric, as it should be. The Fixed was 100% volumetric too. Both Kelly Salt and Doug Dove were adamant that that would not work, because there clearly are components of cost that are independent of volume of water used. Account billing is an example. The billing costs for a one ccf account are the same as for a 1,000 ccf account. Fireline is another non-volumetric cost. We have gotten the non-volumetric costs way down, but they have not evaporated.

    3. Matt Williams

      Variable Use Fee

      Current fee = $0.86 per ccf

      Proposed Tier 1 fee = $0.50 per ccf
      Tier 1 includes 20 ccf per living unit
      Reduces Cost of Low Volume Water
      Reduction of $0.36 per ccf produces a per month savings of $7.20 at 20 ccf

      Proposed Tier 2 Fee = $1.90 per ccf for use greater than 20 ccf per living unit
      Incentive to Conserve
      Immediate Reward for Efficient Use
      Does not penalize large families
      2.25 ccf per person (State standard)

      For the Variable Use Fee there is a positive delta for every user who consumes 28 ccf per month or less, as much as $7.20 per month. If you use more than 28 ccf per month you will be paying more Variable Use Fee than you would under the current rate structure.

  2. Davis Progressive

    does anyone else believe that both matt williams and council believe or at least fear that measure p will pass? otherwise, why not allow the election to occur, and then let the urac figure out how to fix the rates (unless of course you don’t trust elaine who attempted to sabotage cbfr on december 13, 2012).

    1. Matt Williams

      DP, the election will occur regardless … as it should. The question you really appear to be asking is, “Why fix the problem now, when it would be more politically convenient to fix the problem later?”

      The answer to that question is three-fold:

      1) Because our proposal addresses the citizen concerns that have been raised in the Measure P dialogue
      — Simplicity
      — Understandability
      — Fairness
      — Liability Risk

      2) Because in the past four weeks the Measure P supporters put out a “Fairness” definition in the community dialogue , which transformed the community dialogue from a discussion of problems to a discussion of possible solutions

      3) Because of the upwards of $100 million dollar Liability Risk for the Davis ratepayers that was identified in the independent analysis portion of the Measure P Ballot Statement. The only way that the Liability Risk concern can be addressed is by getting this proposed solution out into the community dialogue, which is what this proposal does.

      It is the result of democracy in action and it reduces the community’s fiscal risk.

  3. Don Shor

    Well, I see it is item # 22 on the agenda, right before Long Range Calendar. So it should come up at about 1 a.m.
    This all makes one wonder what they appointed the URAC for. There seems to be a standing pattern in this community of disregarding or bypassing commissions.

      1. Don Shor

        I’m not referring to the behavior of the council. My suggestion would be that they urge the authors of the modified CBFR to present their proposal to the URAC. This flurry of activity before the election has muddied things considerably and probably increased the likelihood that Measure P will pass. It looks blatantly political.

  4. Alan Miller

    The difference between the 6 and 12 months? Say what? Elsewhere it says the lookback is eliminated. And then there is some special “thing” if you moved in to eliminate the previous tenant rates, but I don’t hear an explanation, and it is supposedly convoluted to get it done . . . and is there a lookback? And the rates as explained, a rate and a supply charge, like, I don’t know what these things are, and if they are both tied to a ccf rate, why not combine the two, there are no longer three factors or are there? And the rates given, are those starter ccf rates, as they rise over time, so what are the ones given; and if a tiered approach is proposed, why are rates given? And why is this being done so late in the game after many have voted, and as an informational items, and why would I ever trust that the City Council would definitely change the rates after the fact, even if the authors are sincere, especially if “P” does not pass, and especially with a new Council that hasn’t been seated and we don’t know who they are or what they will think, and especially because even the present council at the very last minute came up with a super uber confusing mixed rate two-years with one structure and another after that as a last minute compromise, which they are only now fixing, a week before the election, when many have voted. And please don’t try again to explain CBFR to me . . . I’m good with numbers, I’m sure it’s simple and I really don’t care to have to figure out something like that and assume that what I’m being told about “fair” is real. It isn’t about “fair”, it’s a policy issue about who pays more by how it is balanced between the price of water and the price of fixed, I get that. What I don’t get is how it can be fair to have people pay for other people’s water . . . and I don’t see how a 12 month lookback is any better . . . indeed it’s more complex than that with Davis as people lose some roommates and not others, and how many people will remain on the lease and who pays for who, and if you have a two-or-more-meter, single-owner situation as I do God help you trying to figure out how much each unit owes as the rates keep changing, especially in this town where they won’t send a bill by the meter, only by owner, so good F-ing luck trying to divide the bill by meter, especially if you have people coming and going from each unit, and especially as the rates apply to lookbacks for sewer, water for Bartle Wells today but future CBFR tomorrow, but maybe a different CBFR with a different lookback today than tomorrow, but trust us we’ll change the rates for the better even thought we didn’t until it looked like P may pass, and one author said they’d help me figure out how to divide my bill between units, but why would I want a rate structure that requires the author of the structure to calculate how to divide my bill?, but trust us, and we’ll fix it, so don’t vote for P, please, and the rates, we’ll ………… AAAAAAAAAAA! Brain: BOOM!

      1. dlemongello

        Alan, please come tonight. If we are able to give the whole presentation, all your questions will be answered in an organized way and any that are not, just ask me. FIXING that whole mess is what this is about. And you know me Alan, this is not political, I just happened to be thinking about a solution and did not see ay reason to save it ’til later once I found one, or at least a great start to one. There are details still to be checked to make sure they work, probably by the URAC, and some issues about Commercial properties and Irrigator only accounts to be brainstormed for a good solution, but this is a great start.
        Don Shor apparently thinks I should have just kept it to myself, so be it.

        1. dlemongello

          Oh, and there certainly WILL NOT BE A 12 MONTH LOOKBACK or ANY LOOKBACK, or I will have to be institutionalized. Getting rid of that is how I got involved.

          1. Alan Miller

            Donna, I think I might know you.

            OK, I am somewhat convinced this meets several of my concerns after seeing your presentation. I cannot say I fully understood it afterward, but it seemed at least I *could* understand it if I sat down with you for 15 minutes. CBFR at best I could get a glimpse of the concept, and then my brain would fog over again. My confusion on the lookback is that there was a six month lookback before, and if I’m understanding, but I guess I’m not, now there is no lookback, but also the 6 month lookback is now 12 months, which seems to be saying there is but there isn’t. What am I missing?

          2. dlemongello

            In our proposal there is NO LOOKBACK, period. You pay for the water used just the month or so before you get the bill, just like we always have done. It is billed at the fixed supply charge rate of ~2.64/ccf+the fixed distribution charge of $8.25+$0.50/ccf for tier 1 (less than 21ccf) water+$1.90/ccf for tier 2 (greater than 20ccf) water.

          3. Alan Miller

            So if it not a lookback, what is “IT” that has gone from 6 months to 12 months? That is what is still confounding me.

  5. DT Businessman

    “why would I ever trust that the City Council would definitely change the rates”

    Alan, because the CC has been refining/reducing the project costs and rates all along exactly as they promised to do from the get go and as they will continue to do.

    -Michael Bisch

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