Past city admin, 2015 council ‘cook books’ to justify water rates, possibly violating Prop. 218

Proposition 218 was passed by the voters to prevent the abuse of the public by government agencies overcharging for essential services such as water and garbage service.

Simply put Prop. 218 states that government agencies may not charge more for a service than the actual cost of delivering that service with a reasonable amount added for maintenance, replacements, upgrades and enhancements. In the case of Madera’s outrageously high water rates I set out to determine, if in fact, the spirit of Prop. 218 had been violated.

I began by retaining a San Diego law firm that specializes in Prop. 218 cases and has successfully sued several cities over alleged violations of Prop. 218. Erik Benink of Krause, Kalfayan, Benink & Slaven was sent the consultant report utilized by the City of Madera along with a copy of Resolution 15-156 setting the new water rates for his review and comments. After analysis of both those documents Mr. Benink wrote his opinion.

The following is an excerpt from that opinion: “Conservation costs may presumably be recovered through peaking factors. In other words, to the extent the City is incurring expenses on conservation efforts, programs, and education, that cost could be rightfully passed on to profligate water users.

“In the ‘Detailed Revenue Requirements,’ the Report projected $51,000 in conservation expenses. Yet, Raftelis increased that figure to $1,000,000 per the request of the City Council, which then became part of the rate design.

“Although the rate design includes this $1 million projected expense, the city has not expended such amounts on conservation efforts. The FY 2016-2017 city budget reflects a $400,000 expense budgeted in FY 2015-2016 for ‘Water Conservation Program,” but it also shows the actual as ‘$24,000’ and the FY 2016-2017 budgeted amount to be $230,000.

“While local governments have discretion to set budgets, they cannot feign an expense to generate additional revenues — especially when it appears that it was designed to foist costs on higher-end water users. The fact the budget never reflected $1,000,000 demonstrates that this cost was never intended to be incurred by the city.”

What Mr. Benink is saying is that the past city administrator and council possibly conspired to artificially increase the cost of water so that they would have approximately $976,000 excess cash at the end of each fiscal year for some purpose other than the delivery of water. This is in direct violation of Prop 218.

The results of Madera’s current water rates are beginning to show in the appearance of our community with lawns and trees dying all over the City as local residents attempt to ease the pain of the artificially high water rates.

We as a community should demand better of our leaders. Instead of attempting to “loot” monies from our residents to help continue the ridiculously high salaries paid to our administrators, our leaders should be finding new sources of water and working towards beautifying our City rather than forcing it to dry up.

— Michael Pistoresi,