Cost-proportional water rates are the law
Over the past several weeks I have been publicly vilified by dozens of recipients of the El Dorado Irrigation District’s special $49 agricultural water rate.
EID has 950 agricultural and small farm rate recipients and 96 percent of the 6,000 acre feet of water they now receive annually is billed to them by EID at the rate of $49 per acre foot. In comparison, most outside water consumption of residential ratepayers is at a rate of $829 per acre foot.
Dozens of the $49 rate recipients argue vociferously that the agriculture community founded EID and deserve special rate consideration “because of their historical contributions to the district”. They further demand rates based upon a theoretical cost that assumes they receive raw ditch water even though most of the 950 receive inside residential use, are far from an EID water supply ditch, and the water they receive is treated water.
Debt costs account for one-third of EID’s rates. The $49 rate recipients pay 2 percent of EID’s debt costs even though they consume 20.2 percent of EID’s water.
A number of agriculture rate defenders further argue that the $49 rate calculation is wrong and then build their case based solely upon how EID charges the first 4 percent of their water consumption. Yet the $49 calculation is absolutely correct for 96 percent of their annual 6,000 acre feet water consumption.
What legally overrides the arguments of all the $49 agriculture rate defenders, however, is that EID Directors took an oath of office to adhere to the California State Constitution. And the California State Constitution, Article 13d, mandates that all water rates be cost-proportional. By California law, this mandate cannot be politically overridden by EID’s Management and Board.
It is important to note that when water comes out of EID’s water treatment plants its costs don’t transform from $829 for 35,000 ratepayers to $49 for 950 others. To use different cost assignment methods, as EID’s cost of services report clearly documents that EID does, further violates Proposition 218 rate compliance requirements established by the Association of California Water Agencies.
Unless EID quickly brings its rates into legal compliance, it is only a matter of time before EID faces a class action lawsuit from ratepayers paying $829 per acre foot who collectively are being overcharged millions of dollars annually to deeply subsidize EID’s $49 agricultural rate.
EID Director, Division 2