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Consolidation of three county water systems under consideration

Staff Report

if you go

What: Douglas County Commission

Where: Tahoe Transportation Center, Stateline

When: 1:30 p.m. Thursday.

Preparation to consolidate Lake Tahoe’s three county water systems will go before Douglas County commissioners at their Lake Tahoe meeting on Thursday.

Should commissioners agree that consolidation is the best plan for Zephyr Water Utility, Cave Rock-Uppaway and Skyland systems, the county would spend July notifying residents in preparation for an Aug. 21 rate-setting meeting.

County commissioners directed staff members to prepare a resolution establishing monthly service rates that would pay the cost of service.

Preparation to consolidate Lake Tahoe’s three county water systems will go before Douglas County commissioners at their Lake Tahoe meeting on Thursday.

Should commissioners agree that consolidation is the best plan for Zephyr Water Utility, Cave Rock-Uppaway and Skyland systems, the county would spend July notifying residents in preparation for an Aug. 21 rate-setting meeting.

The proposed rates have changed as a result of public comment to include the debt service from each of the water companies, instead of combining them into a single number.

Should the rates be approved by commissioners, they would take effect Sept. 2014.

Customers of Cave Rock-Uppaway have the largest existing debt, and therefore would pay the highest monthly rates.

According to a report prepared by Public Works Director Carl Ruschmeyer, those residents would pay an average $162.48 a month. Residents of the Zephyr Water utility would pay $126.77 while Skyland residents would have a monthly rate of $90.58.

Ruschmeyer included rates for the next five years, which have a transfer of $375,000 built into them to help with the replacement of short-lived assets.

The existing debt component of the water systems will decrease over the next five years actually reducing the rate Zephyr Water users monthly rate to $107.38.

Cave Rock users will see their rates increase slightly to $165.34. Skyland residents will see a slight decrease to $91.29.

Flat water rates for Cave Rock customers are $202.46 a month. Skyland customers are paying $114.23 and Zephyr customers are paying $79.95.

Since 2010, the county has subsidized the water systems $120,260.

According to a Tahoe Daily Tribune story, customers of the Zephyr Water Utility District were split on a plan that raises water rates in the system by nearly 50 percent.

On one hand, it appears ZWUD customers will only have to pay their own existing debt instead of a consolidated debt with two other Tahoe water systems: Skyland and Cave Rock-Uppaway.

“It seems they’re moving down the trail of keeping the O and M consolidated,” said Dick Barnard, a ZWUD customer and CPA, “and that’s my concern.”

The new direction, approved unanimously by the board on June , would in fact keep existing debt separate. And the idea of keeping future debt separate has been supported in the past.

“I thought it was the right decision because we want to consolidate and we want to move toward a full consolidation,” Bonner said.

Scott Smith, a ZWUD customer and board member on the Marla Bay Protective Association, said he liked the decision by commissioners because it meant ZWUD won’t need to take on Cave Rock’s significantly higher existing debt and hopefully the future debt.

“We know there’s debt. We know there’s future debt. But we don’t want to have to pay everyone else’s,” he said, adding. “We won two out of three.”

Many people — including Smith’s wife, Piper — spoke up about the proposed rate changes at the Douglas County board meeting Thursday, where commissioners applauded the audience for being civil in the process.

The county’s water systems in Carson Valley were consolidated in 2012, after rejecting an effort to combine all of the systems the county operates.