On December 8th, David Smernoff e-mailed a letter to the community detailing what for about 23% of the community is a rather radical change in the water cost offset program.

The letter agues that for 77% of the community the amount of the discount will increase. The rationale for this change is based, in part, on the argument that the District needs to be better able to forecast the cost of the program.

There are a number of things that the letter fails to tell you that you should know.

• For the 77% of the community that will receive an increased discount, the actual increase amount ranges from $0.95 per month to a maximum  of about of $2.70 per month.
• For the other 23% of the community residents that use over the community wide monthly average amount of water, bills will increase dramatically by, in many cases, more than $100 per month
• On average, residents in the lowest water using 25% of the community will enjoy an 80% discount to their cost of water**.  Residents in the highest 25% use in the community will, by contrast, receive, on average, only about a 20% discount to their cost of water. 
• Participation in the new program will be tied to each homeowner certifying that certain water use efficiency measures have been put in place within the home.

The argument that this change is  justified by a need for more precise budgeting, is, in my opinion, totally without merit.

• The per household uncertainty in the amount of water purchased by the community has never been more than about a 10% deviation from a 3 year moving average. Since the component of the discount that is based on water purchased is only about 60% of the total discount (the remainder being the $12.00/ month connect fee) the total upside uncertainty then is only about 6%.
• Most businesses would be ecstatic if they could regularly forecast variable cost budget line items to 6% or less.
• Some of the board members will correctly argue that, for this year, the cost of the discount program will be as much as 15% over budget. However, they fail to note in the detail that they had, as early as last June, already agreed without benefit of a true public discussion or vote on the specific issue, to reduce the level of the discount received by some of the community. And they set the budget accordingly but then delayed in implementing the program that substantially reduces discounts to some residents.
• Most of the budget line items in this year's budget will be significantly UNDER SPENT  (in some cases by 50% or more) with total under-spends probably greater than $40,000 out of a budget of $160,000. This may look good on paper but the money really should be going back to the community not stacking up in the District bank account.

The community survey on priorities for the Board showed that more than 60% of the respondents felt that MOST or ALL of the District revenue should be returned to the community in the form of the discount program (a promise that was made  in 2003 and kept by the prior Board majority).

• About 55% of total District revenue will be returned to the community this year because the prior Board that left office in November 2005 put in place a program that will do just that. 
• The program approved by the current Board on December 7, 2006 will probably return only about 47% of District  2007-2008 revenue to the community. (This will happen only if 100% of the residents comply with the water use efficiency requirements. If, a more probable, 90% participation occurs, then the amount returned to the community will fall to about 42%.)

The current Board has staked out a position which, simply put, argues that anyone who uses more than the community wide average amount of water should be financially punished. And, make no mistake this is really what the new cap is about. This position ignores the reality that we have a diverse community with differing lifestyles and, differing needs for water. For example, lot sizes in the community vary over a range of more than 20:1.  The discount program as it was originally conceived and communicated to the community was just that - a uniform discount to the monthly connection fees and the per unit cost of water to be equally enjoyed by all users. The new program with  the cap is a faintly disguised effort to insert a component of social engineering into the program. The new plan also ignores the proven fact that relatively small increments in the cost of water have virtually no long term effect on the per household water consumption. The current plan also flagrantly disregards the guidance voiced in the community survey.

Many communities before ours have grappled with the issue of how to establish fair use criteria for water and many different formulas have been tried. Probably the most commonly used and probably fairest in terms of taking into account varying needs is the Maximum Applied Water Allowance or MAWA formula (See page 4 of http://www.cpau.com/docs/factsheets/water/waterstand082002.pdf). This approach is fully as workable as the approach now being implemented but it does give due consideration to the fact that we are all different and all have differing needs rather than trying to force all of the residents into a one size fits all box with dimensions determined in the absence of true community input.

I'd suggest that in the pursuit of fairness, the community needs make their opinions better heard on this issue at the upcoming meeting on February 1st..

Stan Gage

  PS
**Note: I personally find this aspect of the program which is an amplification of a problem extant in the prior program very troubling. The average bill for this low end user group with an 80% discount will end up at a little over $4.00 per month. This exceptionally low cost has already bred explicitly articulated disrespect among some members of the community for the value of the commodity being purchased. I certainly don't expect to necessarily win additional hearts and minds by saying it but I will say it anyway. "It is my opinion that out of respect for the value of the commodity, the discount should cover at most 60% of the total bill." There are problems at both ends of the spectrum in terms of the current discount program that need to be rectified. The current solution hammers very moderate users at the high end of the usage distribution and does nothing to correct and, in fact magnifies the distortions on the low end.