Here are some things Oxnard hopes you won’t notice about the proposed increases to Oxnard’s water, wastewater, and solid waste rates…
Much of this information comes from a cost-of-service report by an engineering firm the City of Oxnard hired to analyze what rates would be necessary to do what they want to do. Click here to see the complete cost-of-service report.
- On the city’s website about the water rate increases, the drought is the first thing they mention as though it is the primary cause. These rate increases are NOT primarily because of the drought. Only a small portion of the increase is due to the drought. The drought is a convenient scapegoat, and perhaps the city thinks they can take advantage of the situation to have their other wish lists fulfilled at the same time. There is nothing in this proposal that would reduce the rates if the drought eases.
- These three utilities are proposing to spend a combined $1.23 BILLION on capital improvements, though the current combined annual revenues for the three utilities are only $124 MILLION. They want to spend $30,750 for each of the 40,000 utility ratepayers in Oxnard.
- About half of this spending will be financed with debt on top of their already existing debt. The wastewater system already spends about 1/3 of its revenues on debt service, though they claim most of their assets need to be replaced. You wouldn’t manage your money by taking out a 20 year loan on a car you expect to wear out in 10 years. No bank would make you that loan, but Wall Street will finance this because the city isn’t mortgaging the assets – they are mortgaging the rate payers!! A lot of the extra money the city wants you to pay for your utilities will be used to pay interest on the debt. Wall Street investment bankers will make a lot of money off of you with this plan.
- The fact that other cities in Ventura County can provide these services at lower costs means our city needs to tighten its own belt before asking you to tighten yours. Other cities are experiencing smaller rate increases in their water only, but Oxnard is ALSO increasing rates for wastewater and garbage collection. Simi Valley recently raised their water rates. The rate increase notice that Simi Valley published points out that even AFTER their rate increase, their water rates are still lower than Oxnard’s current rates BEFORE our increase.
- The city proposes to spend $254 MILLION to expand the water recycling facility and make us use more-expensive-to-produce recycled water instead of buying cheaper water which is available. The recycled water can only legally be used for a few things (not drinking or household use), and the cost-of-service report acknowledges that this very expensive project will not benefit all of us, only a handful of users, though all of us will have to pay for it.
- Two years ago, the city’s materials recycling facility was contracted out to a private firm. The city ended that arrangement because they promised us they could do it cheaper. Our garbage pickup rates are not going down, though. Instead, they’re proposing to increase them by 23%.
- Included in the city’s project wish list are a number of optional projects, though they are not good financial investments:
- An unspecified dollar amount for solar energy production at the waste treatment plant
- An unspecified amount to move waste treatment operations further inland in case the sea levels rise (the facility is 22 feet above sea level)
- $20 million to create a system to convert yard waste into electricity
- $254 million to expand the recycled water facility, though it is cheaper to purchase water than to recycle it
- While they’re raising your utility rates, the city is proposing increasing the amount they spend on their employees at rates double their projected inflation rates. They plan to eliminate a number of contract workers and replace them with more costly city employees.
- These utilities are “enterprise funds” which are supposed to be run like self-supporting businesses independent from the rest of the city’s operations, but they clearly have not used even basic financial management practices. These funds have failed to put aside reserves for replacing worn out equipment, though they knew their facilities were aging. Perhaps they didn’t feel the need to plan ahead because they knew they could just raise your rates and make you bail them out.
How you can help oppose the proposed rate increase:
1) Join us to receive updates/reminders, and volunteer to help spread the word about how to file a protest.
3) Attend the January 19, 2016 public hearing at 6:00 pm in Oxnard City Hall (305 West Third Street).