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Council Votes for Lower Option with Santa Monica Water Rate Hike

Santa Monica Real Estate Company, Roque and Mark

Pacific Park, Santa Monica Pier

Harding Larmore Kutcher & Kozal, LLP  law firm
Harding, Larmore
Kutcher & Kozal, LLP

By Jonathan Friedman
Associate Editor

February 26, 2015 -- Fees for water use in Santa Monica will go up, but not as high as they could be. The City Council voted on Tuesday for a 9 percent increase this fiscal year and up to a 9 percent increase in each of the following four years.

The vote was 6-0, with Gleam Davis absent.

The higher rates are expected to curb losses in the City’s water fund that is sinking because of rising costs and City-mandated reduced use due to the drought (“Council Approves Santa Monica Water-Use Reductions,” January 15, 2015).

Without the rate increase, the fund would go into deficit by next year, City officials said.

The rate hike will also bring in money for some infrastructure improvements, although not all that are proposed, as the City moves toward the council’s goal of Santa Monica having a self-sufficient water supply by 2020.

More than 20 people addressed the council prior to the vote, nearly all of them in opposition (including people against an even higher rate increase that was on the table).

Had approximately 11,000 property owners submitted opposition letters to City Hall, the council would not have been allowed to vote. The number of letters received was approximately 4,600, according to the City Clerk’s Office.

The total includes possible duplicates and letters from those who are not property owners.

A few opponents said the number of opposition letters was lower than it could have been because residents were not told emails were allowed.

Opponents said the rate hike was too high and that the 2020 goal was too soon. Several people favored raising the rate by 9 percent this year only, and then the City figuring out other revenue methods, including a bond.

Mayor Kevin McKeown said "the outcry has been quite remarkable," and he understood the concern. But he said the increase was necessary.

The mayor then told a story about Ireland, where he said he has citizenship, and that there were hunger strikes happening there because water fees were being instituted for the first time.

“The point is that when ever [making] increases, even when you’re raising them from nothing, people will be upset,” McKeown said.

McKeown said at a council meeting in November that raising the rate was "a real sobering look at what it costs [for the City] to truly be free, to be independent."

Many of the opponents who addressed the council were leaders from neighborhood groups. Most of them are political supporters of McKeown and Councilmember Sue Himmelrich, who said in an ideal world she would agree with their idea for only a one-year increase.

Himmelrich said she voted for the five-year increase “in the interest of collaboration.” She added that “we are underpaying for water.”

“I don’t think that we’re paying the true cost of water, and eventually we will be one way or another,” Himmelrich said.

The council will review the increase plan every year during the next four years, and it could determine the rate does not need to go up the full 9 percent.

Councilmember Ted Winterer said he hoped the City could get money for water infrastructure improvements through grants, State funding and possibly a bond proposal in the fourth or fifth year.

He said it would not be horrible if self-sufficiency came a few years after the 2020 target.

The council voted in November to move forward with a plan for a rate increase as high as 9 percent this fiscal year and up to 13 percent in each of the following four years.

At that meeting, the council was only setting a ceiling required by State law in preparation for this week’s meeting.

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