Committee would study ways to lower $5 water surcharge in Las Vegas

By Joe Schoenmann

Published Tuesday, May 1, 2012 | 12:08 p.m.

Updated Tuesday, May 1, 2012 | 1:19 p.m.

A chance remains that the $5 average monthly household surcharge for water in Las Vegas, which went into effect in April, could be lowered or changed.

But only, County Commissioner Chris Giunchigliani indicated, if the Las Vegas Valley Water District does what she asked it to do in earlier this year.

The commissioner lambasted Pat Mulroy, Water District general manager, at the district’s meeting this morning, alleging that Mulroy’s staff changed a recommendation Giunchigliani made in early April.

Mulroy is desperately seeking ways to keep from defaulting on some $3.1 billion in outstanding general obligation debt. For years, debt servicing was taken care of by connection fees, which reached a high of $188 million in the mid-2000s but fell to about $3.2 million in 2010.

In response, the Southern Nevada Water Authority, which is the water wholesaler to seven water districts, commissioned a study to figure out how make up the lost revenue. The study determined a surcharge to be called a “reliability fee” of $5 per month per average homeowner would bring in $300 million over the next three years. Then another study would determine whether more charges had to be added. The $300 million would be divided among the Water Authority’s member districts, according to each district’s use.

Giunchigliani agreed to that solution with one caveat. She reserved the right to create a committee to see if it could come up with a different way to reach the $71 million for the Las Vegas Valley Water District to meet its part of the $300 million. The other six water districts agreed to the surcharge without complaint.

So, she said Tuesday, she was dismayed to read minutes of an April 3 Water District meeting that ordered the creation of a Water Authority committee. Giunchigliani is not a member of the Water Authority, and said she never intended the Water Authority to determine Water District systems. The minutes should have said the order was to create a “Water District” committee.

Mulroy said it was a miscommunication and there was no intent to deprive Giunchigliani of the chance to create a committee. A corrected version of the April 3 minutes will be voted upon at the next Water District meeting. In addition, the Water District will decide whether to authorize creation of Giunchigliani’s committee.

After the meeting, Giunchigliani said her committee, made up of business owners, homeowners and others, would spend up to 18 months, taking a no-holds-barred approach in looking at a gamut of options, so long as whatever was devised would meet the $71 million mark. That could mean, she added, that some homeowners would be eligible for refunds of their $5 surcharge.

“We will look at everything,” she said.