The Taxpayers Association has been conducting an analysis of the city of San Diego’s water/wastewater rate case proposal since last November. After a thorough review of the cost of service study and nearly two dozen meetings with city staff and stakeholders, we have come to the conclusion that the rate increase deserves support if the city commits to the creation of an Independent Ratepayers Oversight Committee with clearly defined responsibilities.
The oversight committee’s primary responsibility should be to oversee independent audited financial reports on rate and bond proceed expenditures and independent performance audits on both water and wastewater systems. The committee should also be tasked with tracking any savings in the systems as a result of business process re-engineering or managed competition to ensure that the savings will be used for water and wastewater capital improvement program projects.
The bottom line is that the city has regulators breathing down their necks, and we do not believe it would be fiscally prudent to call a bluff on the regulators or courts. There’s just too high a risk that such action could adversely impact the city in the form of significant fines, litigation, liability, or in the worse case scenario, receivership. And in each of those scenarios, the cost to ratepayers would exceed what we are facing with the current rate proposal.
In fact, we really need to be careful what we wish for. All to often in the past, politicians either punted on the issue of water/wastewater rate increase during their terms, or they proposed rate increases at a level that was palatable to ratepayers, as opposed to setting the rate at a level that would honestly get the work done.
We are hopeful that this time, things will be different. But we’re not going to leave things to chance and trust. The Independent Ratepayers Oversight Committee is a stipulation of our support for the rate increase for just this reason. The next time a rate increase is proposed, we need to have better assurances from an independent group that ratepayer funds are being used appropriately, effectively and efficiently.
And you can count on the fact that more rate increases are headed our way, whether we like it or not.