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Published Tuesday, June 5, 2012 | 12:45 p.m.
Updated Tuesday, June 5, 2012 | 4:25 p.m.
Jim Meservey, a principal of Storage One, points to the total of his current monthly water bills after surcharges Wednesday, May 30, 2012. The figure at left was the total bill for the prior month without the surcharge. Although the business is a low water consumer, the company has seen its water bills double or triple depending on the size of the water meters. In 2016, the surcharges are scheduled to double, he said.
Water customers lambasted the Las Vegas Valley Water District for, as one man put it, “running amok” and changing the system to the point that some water bills increased by 300 percent in May.
Nearly 30 people spoke Tuesday morning at the meeting of the Water District, including Gordon Marx of the Nevada Fire Sprinkler Contractors Association, who said he knew of 1,000 people who could lose their jobs because their employer might have to choose keeping the employee or paying a higher water bill.
Many of the complaints came from small-business owners now paying a surcharge for fire lines, which provide more water pressure in case of a fire but are rarely used. Businesses previously never had to pay for those lines.
Pat Mulroy, the Water District's general manager, responded that the “growth machine” that shouldered two decades of water expenses has ended.
“We’ve taken water for granted, and the machine that paid for everything has all but disappeared,” she said.
The Water District meeting, which normally lasts for 15 minutes, stretched for nearly two hours. Speaker after speaker decried the May water bills. In February, the Southern Nevada Water Authority board –- which provides water to seven individual water districts in Southern Nevada –- voted to add surcharges to water bills. The Water Authority needs money since connection fees, which had peaked at $188 million in 2005-06, fell to about $11 million last year.
Meanwhile, the Water Authority is shouldering a $3.3 billion debt, much of it due to a third intake pipeline being built deep into Lake Mead. The pipeline is considered insurance as a decade-long drought tightens its grip on the Southwest.
To deal with the Water Authority's drop in revenue, consultants Hobbs & Ong came up with three models, including one to increase water rates in a tiered “pay-as-you-go” manner – the more used, the more paid. The model that gained approval, though, was to put place flat rates on homes and businesses based on the size of the pipe serving that property. Smaller pipes pay less.
Fire lines, which had never cost a business before, can be much larger than, say, an average home’s ¾-inch pipe. So costs for those lines were much higher under the new structure.
The new rate system is to remain in place three years, after which revenues will be examined to see if another surcharge increase is needed.
The 35 speakers at this morning's meeting understood the loss-of-revenue rationale; they just didn’t like how the new charges were spread among water customers.
Dan Laliberte said the new surcharge appears to negate water conservation residents have embraced over the past decade. The Water Authority’s budget says the average per-resident water use has fallen from .85 acre-feet per year to .45 acre-feet.
“Why are we spending money to rip out sod” when water bills still go up? Laliberte asked. “It makes no difference.”
Nonprofit organizations complained their bills went way up but they have no way to pass the cost onto customers. Places like Shade Tree, a shelter for abused women and children, don’t have paying customers.
“I don’t know how to absorb a $12,000 (annual) increase in our water bill,” said a Shade Tree representative.
Pat Mulroy
The Water District wasn’t scheduled to come up with solutions, at least not right away. After the public spoke, the board voted to establish a five- or seven-person committee to work in concert with the Water Authority’s 21-person committee, established to look at rates to see if there is a better way to raise revenues.
The Water Authority committee will begin meeting sometime this summer. At some point, the Water District committee will look at the Water Authority’s recommendations, then figure out how to implement them in the Las Vegas Valley Water District.
Some ideas already have percolated, including one by Clark County Commissioner Steve Sisolak to add a water reconnection fee – similar to electricity or cable TV reconnection fees – to the price of a home when it is sold.
After the meeting, Mulroy said a problem with the idea was that about two decades ago a group of businesses sued against a similar charge. The electricity reconnection fees, they argued, is for work actually done. But that isn’t necessarily the case for this so-called water reconnection.
CORRECTION: This version corrects the spelling of Gordon Marx's name. | (June 5, 2012)
Municipalities issuing bond obligations under the premise repayment would be contingent upon growth financed by the likes of unregulated derivative swaps and interest only mortgages is criminally fraudulent -- the criminals got rich while the common man continues to be punished.
Where the bonds insured?
What were the bond ratings?
Who rated the bonds, and what criteria did they use?
Immediately HALT the projects -- recall the bonds and issue new bonds inline with revenues or bite the economic bullet and default them.
Suspect there's much more to this story which the public isn't being told -- start with a review of expenditures.
Perhaps the march on Wall Street movement needs to be localized?
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"Gordon Marx, of the Nevada Fire Sprinkler Contractors Association, who said he knows 1,000 people who have lost jobs because their employer had to choose between keeping the employee and paying a higher water bill."
LOL. Name the names then. Can't? Well, I think I can accurately call you a liar, and an obvious one at that.
I would think that a gallon of water is a gallon of water. SO what was the issue with the pricing by amount consumed model? That would seem to be the fair way to pay for a utility.
If it isn't fair then that means there are deals that benefit some users but not others and that is not right! Every gallon of water that comes out of the ground and lake has a price and that should be equal to all customers!
I would even understand a tiered system where the pice changes by the amount consumed. That is not unfair either and pushes conservation which is a good thing in a drought stricken desert!
But pricing by pipe size is just stupid! It doesn't even make a connection with consumption!
Then maybe the MORONS at the water district need to QUIT SPENDING MONEY like there was no down turn in revenue.........3rd Inlet........a WASTE of our money.....the hike in water rates was just to accommodate their FAT SALARIES and ivory towers to view their kingdom from.
The reason they won't charge based on how much is used is because people will stop using water and the LVVWD is back to square one. They tell us to conserve and when we do they say they aren't making enough money so they have to raise the rates. Maybe it's time to reduce the size of the staffing and salaries of the remaining staff including Ms. Mulroy who is paid in excess of $200,000.00 a year.
mulro is a clown...
btw...
why the hell wasn't the second straw built a little longer...
that way we wouldn't need a third straw...
are plans in place already for a fourth straw???
i made the comment on last article about this issue to reduce snwa salaries by 20% and budget by 20% as a start....no one in government ever discusses paying employees or executives less money or scaling down projects to meet a budget---it is always a discussion on how to soak more money out of the taxpayers!
Oh, you're going to LOVE this; yesterday? My complex had a broken water line and our water was shut off for 12 HOURS! The notice we were given stated from "9:00-4:00", that was posted on Saturday. Now my complex has residents demanding free rent because the water company, who probably forgot about us, forced some of the residents (no doubt) to bathe in the swimming pools because they work the graveyard shift, due to NO running water in the units!
Thank you SO much SNWA!
Yep, have the employees of the water district taken pay cuts like everyone else yet? Nope, let's start there. How about a furlough or two for them also? Maybe a hit or two to their benefits and insurance? Time for them to jump off the gravy train that no longer exists here.
Just about everyone has taken a whack to the above stated salaries and benefits. I think it's time that NV Energy, Southwest Gas and the clowns at the water district do the same, instead of jacking the customers who have been nailed by the economy to pay for their raises and lucrative benefits.
Can we think up a few more ways to kill existing small businesses? Can we come up with more reasons for business not to relocate to Nevada? Can we think up more ways to go backwards in building fire safe homes? Can you imagine builders advertising the fact that in their such and such square footage homes, 3/4" supply lines/meters were used to keep down water bills? I guess only the rich who need to be taxed more will have the 1" lines from now on.
Obviously no one at the water district has owned or run a small business with any degree of knowledge or competency or they wouldn't slam them with thousands in new charges. It's tough enough to survive these days. The number of empty commercial spaces is outrageous as it is and now we have one more impediment to business survival and new business.
Wonderful. What genius.
I am so glad we decided not to move back to Las Vegas. Where we live now the unemployment rate is 4.8%, our water bill is $9.11 per 1,000 gallons of water, electric and other utilities are the lowest in the 3 state area and there hasnt been a murder in 8 years and we have 3 well run casinos within 30 minute drive of the house.
Nice to have you gone, pele. Please stay away.
I say Pay As You Go!..............And a reasonable water hookup fee.
Well need to pay to save las vegas
Uh, Pele do the math. You obviously haven't lived in Vegas. If you pay $9.11 per thousand gallons, then 10,000 gallons used would be a bill of over ninety bucks. Sorry, but I used that much last month, and mine was just shy over thirty. Think before you write silly statements such as that.
Harley raises some very good issues. Many of these Bonds should simply be defaulted on. These new rate schemes are nothing more than taking advantage of captive customers. How long do we have to cater to bankers over our residents?
It is really appalling just how badly things are run. Not only SNWA, but one wonders where the Governor is? our Senators and Reps? At what point are any of these idiots going to do a darn thing regarding water? and you wonder why Nevada Real Estate prices here are cratering to the extreme? A good chunk of the declines must be tied to this water crisis.
Under the severely outdated "rules of the river", Mexican watermelons have greater rights to Colorado River water than residents of Southern Nevada. I am sorry but Nevada needs to work on getting more than a lousy FOUR percent of the river water.
The whole reason for the third straw rests on the fact Mexico stores their allotment, 5x or 6x times what we get, in Lake Mead. As they have no storage infrastructure of their own. Pretty soon our old straw in the upper part of the lake is going to be high and dry as the river is always over allocated and is now being used like never before. The more tomatoes they grow in Mexico, the more at risk our domestic drinking water supply is.
Here's a good link for more info: http://en.wikipedia.org/wiki/Colorado_Ri...
Busines is such a welfare queen. They want the water they just don't want to pay for the water or infrastructure required to deliver it.
I get that fire suspression systems need a 1" line but water isn't being used. So they are being charged thousands for water not being used?
Nice job Pat. Open those valves and let the money flow.
Water bills should be or do two things: They should encourage conservation, so we avoid the huge infrastructure costs that SNWA and company want to dump on us, and they should be fair. The existing billing structure fails on both counts.
What it does is fund SNWA's gorgeous new digs by the Smith Center and makes sure the big industrial users don't see an increase. The little people can pay for those.
Conservation? Ya, we all know what happened when people started conserving energy - they simply raised the rates so that people using less were still paying the same due to the rate increase. No thanks, if I'm gonna have to pay for it anyway I'll just crank down my thermostat and sit comfortable in my home in the summer. Start with cutting all these bloated salaries all these top dogs make - you know, the ones who do next to nothing, the ones who go higher, do less, and the less they do the more they get paid to do nothing.... cut those salaries before simply raising everyones' rates all the time.
The cost of willful ignorance. Six months ago both newspapers had numerous stories on this matter and, subsequently, each water district board held hearings and voted on the policy. Where were you at that time? Reading the one-eyed guy or Elfman or Kats column? Losing a hundred bucks on the slots? Watching some vastly more important big game? Ya'll bitch a lot but hardly anybody participates in decision making.
Southern Nevada Population = 2,000,000
Water use Per Yr per resident = 92,000 gallons (252 gallons a day)
SN Colorado River Allocation Yr = 97.5 Billion Gallons (300,000 acre feet acre foot= 325,00 gallons)
Total Resident use 2 mil x 92,000 = 184 Billion gallons a year.
SNWA estimates we get 90% of the water from the River.
So the question becomes, who is watching SNWA? Obviously they have been sucking more water from Mead than the agreements call for. They have been central in what looks like a growth spiral here which is double our water capacity. We hit a population cap based on water use probably back in the 1980's. The numbers using 90% as a baseline say we can support about a million people in SN, not double that.
Is this the tip of the iceberg to what could be a massive RE scam? stealing water to make uninhabitable desert livable? to make a bunch of land owners a pile of money on their worthless land?
what am I missing here?
Just wait till we start paying for the "pipeline". That is for 7 to 15 billion not just the 1 billion, so far, on the straw.
Its called return flow credits Stephen, actually Southern Nevada uses roughly 435,000 acre/ft a year.
@ Toothy...The numbers used above came from SNWA reports.
While return flow credits are a part of the mix, and do represent some fancy leveraging, they still do not fully explain the rest of the water provided. At best direct returned water to Mead is 10% of the total which is what SNWA says it amounts to. Much of the used water is diverted to golf courses and resold.
Your number of 435,000 means residents are using 22,000 less than the number I got from SNWA publications.
Couple of additional items. If one looks at historical flow rates of the Colorado at Lees Ferry AZ (http://treeflow.info/upco/coloradoleesme...), one will not find what could be considered "drought" conditions. The numbers bounce around but they do not show what the media says is a drought.
What did drop significantly from 2000 to 2009 was the level of Mead. Right in step with a massive build-out of this valley.
In the grand scheme of things, nothing has fundamentally has changed with the Colorado or Lake Mead via nature or even historical water agreements. But the problem is IT HAS changed dramatically in reality. Lake Mead has dropped significantly To a point SNWA is spending over 3 billion on a new intake since their old one could be high and dry soon.
So what has changed? Las Vegas has. So if a town which was already at peak water 10 years ago adds close tp 40% more people between 2000-2009, recycling water cannot explain it.
SNWA has simply been taking the water be my contention.
All things being even, what other explanation can there be? We had a 9 year pump and dump of the RE market here, based on stealing water. The entire scheme has now imploded upon itself.
The SNWA is now like somebody buried in credit card debt with maybe one card left they can kite.