Rim Country Water (RCW) is misleading the public into thinking that Pine Water Company and Strawberry Water Company can be purchased without cost to the rate payers.
The RCW plan is based on three unreasonable assumptions:
1) That the water companies can be purchased for significantly less than they are worth. The RCW plan has $2,600,000 for the purchase. This is one-third less than the value in 2003 and much less than the current estimate of $5,400,000.
2) That money borrowed at 4.1 percent can be invested to earn 5.5 percent. The RCW plan holds millions of the borrowed money for several years. To earn 5.5 percent, they will have to make investments that risk the loss of principal in a period of a falling market.
3) That the variable costs to operate the water systems can be reduced by 28 percent. Increased purchases of private water, rent for facilities and reduced overhead efficiencies will push costs up, not down.
In addition, the RCW plan increases property tax collections for the district from $15,000 a year to $40,000 a year, an increase of 266 percent. All this and we get to wait three years longer for water than the K2 well.
The purchase of the water companies will be extremely costly to the community, especially when compared to the cost of K2. The K2 well will solve the problem for a few dollars a month to Pine rate payers. Purchasing the water companies will be much more expensive and impact rate payers and property owners in both Pine and Strawberry.
A detailed analysis of the RCW plan and the cost of purchasing the water companies can be found at www. WaterForPineStrawberry.com.