Water Customers Face 15% Increase in Rates

Steep rate increases may be in store for customers of the Las Virgenes Municipal Water District as part of the agency’s plan to erase a projected $4.5-million budget shortfall for fiscal 1996-97.

Beginning in July, customers would pay 15% more--or approximately $9.60 more a month--under the plan, which the district says would bring in an additional $3.6 million annually. It would be the sixth increase in as many years.

The board of directors voted 3 to 2 in favor at a first reading Tuesday. A final vote will be taken May 28.

The board, which had voted unanimously two weeks ago to approve a 10% increase, was supposed to have taken a final vote on that proposal Tuesday. But in the interim, the district’s fiscal planners changed the proposed increase to 15% because “we needed a stronger fiscal situation than could be achieved with a 10% rate hike,” said James Colbaugh, district general manager.

Board members Glen Peterson and Steve Gavin voted against the 15% increase. Peterson said he believes that the district’s fiscal forecasts are too gloomy and that 10% would be sufficient. He said that, among other things, he expects revenues from connection fees to increase significantly as construction begins on several large-scale developments in the area.

The district has proposed other measures to close the budget gap, including eliminating 12 vacant positions from the staff, deferring some capital expenses and streamlining staff functions and purchasing procedures. The board of directors will vote on those measures in June as part of the district’s fiscal 1996-97 budget.

Agency officials say the shortfall was caused by a sharp decline in the number of new hookups over the past few years. But critics, such as Ernie Dynda, president of the United Organizations of Taxpayers Inc., said the agency should have foreseen the drop in revenues and curtailed spending accordingly.

“It’s difficult to predict recessions,” Peterson replied. “If these people saw it coming, I wish they would have told us.”