At the last PSWID board meeting, the board stated that the purchase of the water companies would not require a rate increase for two years and that the significant difference in the rates between Pine and Strawberry would be maintained during that time. They cited an analysis by economists.com to backup their statements.
In looking at that analysis, it becomes clear that the board is misleading the public in what the water company purchase will actually cost. In addition to significantly understating the costs of operating the water system, the board achieves the no rate increase in the first two years by extending the length of the loan from the typical 20 years to 25 years and having the first two years of the loan be interest-only payments.
The analysis shows that in 2009, the monthly base rate for Strawberry will be made the same as for Pine. For united rates, that is an increase of 15.3 percent. Williamson rates see a decrease of 9.3 percent. In 2011, all of the usage rates will be changed to the current Pine summer rates and apply year-round to all Pine and Strawberry customers.
In 2011, Pine customers using 3,000 gallons per month will see an increase of 8.9 percent and Strawberry customers, an increase of 20 percent. In 2012, the projected increase is 15 percent for all customers.
Once the district has the water companies, they will not be able to operate at a deficit and every cost will be passed on to the rate payers. Every overly optimistic assumption that they are making on price and operations expenses that doesn’t come true will have to come out of our pockets.
We deserve better than this from the PSWID board. There shouldn’t be gimmicks to make it look like it will be “free.” The community deserves to be given an honest assessment of the costs involved.