Santa Fe Irrigation to move forward with tiered rate structure

The Santa Fe Irrigation District continues its rate-setting process for the next two years of water rates. Based on the long-range financial plan included in the district’s cost-of-service study, due to the loss of local water due to the damages to Lake Hodges Dam and other financial impacts, the estimated annual increases in overall rates are 5% on March 1, 2023 and 7% on January 1, 2024.

At the Santa Fe Irrigation District (SFID) board’s Oct. 25 meeting, they voted 3-2 to direct staff to move forward with a three-tiered rate structure with a meter overlay for single-family residences. Directors Sandra Johnson and Ken Westphal, who represent Rancho Santa Fe and Fairbanks Ranch, voted against the tiered rate structure, preferring instead a uniform rate for all customers.

Staff will come back before the board at the Thursday, Nov. 17 meeting to discuss customer impacts for the tiered rate structure and potential options to offset the costs, such as the utilization of reserves or application of property tax revenues.

Rancho Santa Fe Association Manager Christy Whalen said SFID’s decision to move forward with the tiered rates was “disheartening” and “frustrating”. The Association has been in favor of the uniform rate structure as they believe it is the most fair to all customers.

“We believe we’ve been subsidizing some of the smaller lots for years,” Whalen said at the Association board’s Nov. 3 meeting. “There’s no local source of water anymore due to the damage at Lake Hodges and we’re not sure when the local source of water will come back. We’re still paying higher imported water rates whereas in some other areas they’re continuing to enjoy lower rates.”

Whalen and other Rancho Santa Fe and Fairbanks Ranch residents have spoken out against the rate structure and she believes they have offered a strong and logical argument. She said the Association will continue to push to have their voices heard and encouraged others to do the same.

Four years ago the Association sued SFID, alleging that the 2016 water rate structure unfairly penalized Covenant members with higher water rates because their larger properties require more water for irrigation. The case was settled last year.

Once the rate structure is finalized by the SFID board, a cost-of-service report will be presented in December. In accordance with Prop 218, notices about the proposed rate increases will be sent out at that time, giving customers a 45-day window to protest. A public hearing to officially approve the increase would be held in February or March 2023.

Facing challenges such as drought, declining water availability on the Colorado River, the rising cost of the water supply and increased conservation regulations, SFID’s strategic plan is focused on safely and cost-effectively meeting the water needs of all its customers.

Recently the district completed several infrastructure projects, including improvements to the mechanical dewatering project at the R.E. Badger Filtration Plant, enhancing the ability to remove and manage water treatment solids which is critical for proper water treatment. Improvements were also completed at the San Dieguito Reservoir Dam and Reservoir, including the concrete refurbishment of the dam’s downstream face. These improvements were identified during routine inspections and will extend the life of the dam by 50-to-75 years.

The projects were all completed on time and under budget, according to SFID. Recently, the district’s 2022 budget received the Distinguished Budget Presentation Award from the Government Finance Officers Association. This is the 15th year SFID has received this award.

“Santa Fe Irrigation District is committed to ensuring our customers have reliable and affordable water supplies,” said Michael Hogan, board president in a news release. “Properly maintained infrastructure and sound financial practices are key to that commitment.”