Use dwindles: But water debt may more than triple
In the next five years, the debt load on the urban water system would more than triple, according to the recently submitted budget from the local waterworks. And that's got water-watchers concerned that area bills will jump.
"Some official needs to step up to the plate and explain that rates are going through the roof," says former Charlottesville Planning Commissioner Betty Mooney.
Mooney expresses particular outrage that just a year after the local waterworks chair predicted annual rate increases of just 1.2 to 2.5 percent, the rates unveiled last week show a single-year spike over ten percent. (And that's just the wholesale rate; what the two major municipalities will charge their customers will not be revealed for another month or so.)
It was a highly publicized May 6 City Council meeting on the topic of dredging–- one in which many leaders attempted to downplay the value of dredging and downplay the costs of a proposed reservoir/pipeline system. There, waterworks chair Mike Gaffney gave his five-year forecast of the wholesale rates: "The city rates increase 1.2 percent a year, and the county rates are 2.5 percent a year." (Gaffney's prediction was documented by Charlottesville Tomorrow.)
"No human has a perfect crystal ball," explains Gaffney. "Multi-year rate forecasting is based upon the best information available at the time."
Contrary to those who claim a fundamental downward trend in water use, Gaffney sees merely "short-term reductions in consumption" due to "a dry weather cycle and the recession in our current economy."
Mooney, however, isn't mollified. And she has been complaining that the waterworks is trying to build an unnecessary dam/pipeline system and points out that most of the costs of that system–- over $100 million–- aren't even included in the waterworks' latest five-year capital improvement plan or its planned debt wave.
Indeed, the budget plans a state-mandated nutrient removal sewer system upgrade, estimated at $52 million, as well as a massive rerouting and enlargement of a cross-town waste pipe known as the Meadowcreek Interceptor and related projects for $37 million.
Mooney, noting that debt service already accounts for about half the annual spending and who obtained a 2006 email in which the waterworks director forecasts much steeper rate increases, simply thinks that the Rivanna Water & Sewer Authority is in over its head. More recently, a 2007 Authority memo talks of a "straw position" of five percent annual increases.
"It's like the financial collapse," says Mooney. "They're using all these financial instruments that they don't really understand."
She contends that the water supply solution has been staring decision-makers in the face: dredging the Rivanna Reservoir. That, she says, will provide most, if not all, the needed water. And the Authority, which stockpiles an annual profit of around $5 million, appears to have the approximately $30 million already in hand to fund such a project without taking on any new debt.
Existing debt on the Authority's urban system is $42.7 million. Under the proposed budget presented to the board February 23, the Authority would incur $105-115 million in new debt. That combined debt load, as much as $3,300 per household, veers close to a quadrupling of debt for a system that appears to be selling less water each year.
Consumers used less water in January and February this year than previously in those months in the 11 years that the Hook has records. Likewise, 2008 finished up as the year with the second lowest use in that same time frame; only the record-breaking rainy year of 2003 saw less water use. All these reductions come despite growth and annual requests to bring new and existing neighborhoods into the urban system.
RWSA officials, such as director Tom Frederick and board member Gary O'Connell respond that it's drought restrictions that are bringing the water use down. O'Connell recently handed a reporter a red graph showing a decade with two drought watches, one drought warning, one set of "phase one" restrictions, and even a set of "phase two" restrictions.
Whatever the reason, increasing prices amid falling use upsets Mooney, who says consumers appear to be getting punished for their own conservation efforts, and the Authority's own documents admit as much. According to the new budget, handed to the board February 23, “Rates must increase due mainly to lower flows."
–last updated 1:10pm, March 3