MVWD Board Raises Water Rates

By VERNON ROBISON

Moapa Valley Progress

The Moapa Valley Water District (MVWD) Board of Directors approved an 8 percent increase on water rates during a meeting held on Thursday last week. Effective July 1, the rate increase will bump up both the district’s monthly base rate as well as its usage block rate for all of its customers.
“I definitely don’t like a rate increase,” said board member Randy Tobler. “But under the circumstances, I don’t really see how we can avoid it.”

At the meeting, board members emphasized that they had cut expenses in every way possible over the past six years in hopes of staving off the regimen of regular rate increases that had previously been projected by district rate studies.
“I feel like the board, management and staff have worked hard to keep costs down over the years,” Tobler said. “But that only goes so far. This is one that we just have to do, I’m afraid.”

The main factor in the current rate increase was the need for a new well to be developed near the MVWD Arrow Canyon facility just above the Warm Springs area. District staff has identified an impending need for the replacement of the crucial Arrow Canyon #1 (AC1) well, the district’s primary source for water.

Producing 4500 gallons per minute, AC1 supplies the bulk of the needs of the district, especially during the summer months. All other MVWD sources together don’t add up to this one well’s production.

But AC1, in operation since 1994, is reaching the end of its life cycle. District officials have determined that a new well is needed. Plans are in place to drill another production well in the nearby area by fiscal year 2022.

But the project is expensive. With BLM permits, environmental requirements, engineering, equipment and labor costs, the price tag for the new well is estimated at $3.2 million.

Under current financial projections, this would cause a major impact to the MVWD financial status. The district would spend through all of its roughly $5 million in cash reserves by 2023. From there, cash levels would then continue to plummet into the red, staff projections state.

MVWD staff has, in recent weeks, been working on a plan which would avoid such a catastrophe. An initial version of the plan, presented in the May board meeting, would have had the district issuing a bond to cover the costs of the AC1 replacement well. This would alleviate the cash flow problem.

But board members were hesitant to plunge the district further into debt if it could be avoided.
Last week’s presentation removed the bonding element from the equation. Instead, it set aside a list of proposed capital improvement projects that could be delayed for the time. In addition it proposed a series of moderate rate increases. It was hoped that this plan would allow the district to pay cash for the new Arrow Canyon well, while not incurring more debt.

Board members at the meeting said that they felt good about this path.
“I know that the original proposal included bonding,” said board member Ryan Wheeler. “I appreciate the budget-consciousness of the staff in going a different way with this proposal. It allows us to avoid bonding, at least for the time being.”

“It’s clear that this is not enough to pull us out of the woods completely,” said board member Lindsey Dalley. “But it does get us to the next step. And hopefully by then we will get a large user or a different growth rate and things will get better.”

Tobler made the motion to accept the rate increase. The motion was approved with a unanimous vote of the board.