By VERNON ROBISON
Moapa Valley Progress
A customer complaint about a recent change to rate policy was voiced during the public comment period in last week’s meeting of the Moapa Valley Water District (MVWD) Board of Directors. Moapa resident Ben Learned stood in the meeting to raise an objection to a change enacted in the September board meeting.
The change had increased the base rate on a sub-class of customers with ‘off and locked’ meters. It eliminated a special rate class which had allowed a total of 73 customers with ‘off and locked’ meters to pay only $10 per month instead of the $35 rate charged to other meters in the system.
Learned said that he owns two such meters that had been ‘off and locked’ since well before 2005. He explained that he had purchased them many years prior to that because at the time there was a general “scare that water meters were about to jump sky high in cost.”
“We had some property that we thought about doing something with, so we decided to go ahead and buy the meters then,” Learned said.
He never did develop the property and the meters had never been put into service, he said. “Not a drop of water has ever flowed through either one of them,” he said.
Learned said that he understood that his meters had been grandfathered into the new rate and that a promise had been given by the district. “I felt like we had an agreement on these rates because of the situation we were in,” he said.
To clarify, MVWD General Manager Joe Davis reviewed the history of the issue with the board; none of whom had served on the board when the special rate class was established. Davis explained that the district had contracted a comprehensive rate study by a company named Red Oak Consulting back in 2004. In December of 2004, the MVWD Board enacted the recommendations of the study by establishing a base rate for each meter.
The following month, a number of customers appeared before the board to appeal the decision. Like Learned they all owned ‘off and locked’ meters. All were facing a much higher base rate, for a meter which was not in service.
The board, at that time, acquiesced to their wishes. They created a special rate class which set $10 as the base rate for the meters which were ‘off and locked’ before 2005. Originally there were about 200 meters in that class, Davis said. That number has reduced over the years since then to only 73 meters currently, he said.
Davis explained that the issue probably never would have come up except under some specific recent circumstances.
“Right now we are looking at having to replace our Arrow Canyon Well because it is failing,” Davis said. “That is a huge expense.”
Davis said that, in filling out the paperwork for financing on that project, he had uncovered a problem. The USDA program offering the special financing requires a careful review of the district’s rate structure. “They won’t let you have a special rate class for 73 customers,” Davis said.
Davis related that years ago the district had a special rate in place for senior citizens. “It was a lower rate to help seniors who are on a fixed income with their water bills,” Davis said. “But when we got to a point where we had to apply for financing on a big project, they made us do away with that rate class. This is a similar situation to that.”
MVWD attorney Byron Mills added that the ‘off and locked’ meter customers were not actually in a grandfathered program. Rather it was just a special rate class set up by the board in 2005. “At no time, were those customers promised that there would never be a change to those rates,” Mills said. “In fact they have just been enjoying a discounted rate now for almost 13 years.”
MVWD Board Chairman Ken Staton assured Learned that the board members were troubled about finding a solution that would be palatable to all of the parties concerned. He explained that the board had even discussed the possibility of setting up a program where the district would offer to buy back the ‘off and locked’ meters from the customers. But that idea turned out to have complications as well.
If such an offer was opened to just those 73 customers, it would also have to apply to a broader class of ‘off and locked’ meters, Davis explained. This would include developers who had purchased ‘off and locked’ meters after 2005 and had been paying the full $35 base rate ever since. The district currently has more than 350 meters in that category, Davis explained.
“There is nothing that we can do there that won’t end up being a jailbreak for people to start turning back in their meters,” Davis said. “If we open that up then it would have a big impact to the budget. That’s $144,000 out of the annual budget if we did that. You couldn’t do it without raising everyone’s rates to make up the difference.”
“That obviously wouldn’t work,” Staton said. “So we are at a point where our hands are tied. In order to get financing we had to take action on this.”
In the end, board members said that they had to stand firm on the decision they had already made. Learned went away not entirely content with the situation.
“I had a good idea coming down here today that I wouldn’t be able to make any impact at all,” Learned said. “The federal government has made you go back on your word. That is what you all are saying in a nutshell.”