In a recent article in the RSF Review covering the retirement of Bud Irvin from the Santa Fe Irrigation District board, there were many comments on how well everything is going in the Santa Fe Irrigation District, and implied that in going forward the status quo should be maintained. In fact, it can do better, and a stronger business representation on the board can make that happen.
Five-year water rate increase: 94 percent.
The Santa Fe Irrigation District water rates have gone from $1.76 in FY2006 to $3.42 in FY2011. The rate increases have generally been in step with those of the County Water Authority from whom water is purchased, and these water costs are cited as the reason for the SFID rate increases. What isn’t said is that purchased water is only about one-third of the cost structure of SFID, and the majority of the rate increases are actually used to fund the increasing cost of operations.
Five-year administrative expense increase: 98 percent.
In the last five years total administration costs have almost doubled from $1.8 million to $3.5 million. The current board members have let these cost increases occur in a period when demand for water has actually fallen by over 25 percent. Demand will certainly fall further as major users like the RSF Golf Club seek relief by drilling their own wells. The loss of revenue will have to be made up with even higher rates for the rest of us unless costs are cut.
An example of cost containment is the Lakeside Water District, which has a similar number (7,000) of service connections as SFID, and operates with just 14 people. SFID operates with 45 (14 of whom are associated with the Badger filtration plant jointly owned with the San Dieguito Water District). Board members with a business background will want to know what can be learned from Lakeside and other districts in the form of cost reduction opportunities that can be adopted at SFID.
A more business-oriented board would look to structural downsizing to bring the operation in line with the reduced demand for water and do this without adversely impacting the mission of SFID to provide reliable delivery of quality water to its customers. There would also be the active pursuit of cost sharing with other districts and the study of districts which have successfully contained costs.
SFID can do better, and to do so, it needs better business guidance from the board.
Brad Burnett, Marion Dodson, Sam Ursini, Rankine Van Anda