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Incumbent El Dorado Irrigation District Division 5 Director Harry Norris and challenger Alan Day squared off last Wednesday at El Dorado Hills Fire Station 85 before an audience of roughly 20 ratepayers. Most acted as if they’d already chosen their man.
The League of Women Voters hosted the candidate forum. Moderator Betsy Kerr directed edited questions to the candidates, who responded with an informative and spirited exchange.
Norris would later complain that many of the questions submitted by the audience were thinly cloaked editorial statements critical of EID. Armed with his eight years of EID board experience, he politely rebutted Day’s persistent claims of EID’s fiscal irresponsibility, and refuted statistics either embedded in the questions or cited by Day.
Day accused the current EID board of “tossing around hundreds of millions of dollars,” overbuilding both infrastructure and their headquarters in a “debt, spending and rate increase spree,” content to continue business as usual while voting in lockstep much of the time.
Norris in turn wondered aloud if his opponent was willing to commit the time required to do the job, questioning Day’s lack of availability for their public meetings and noting that Day failed to show up for his Mountain Democrat candidate interview.
In an opening volley of statistics that Norris would later refute, Day claimed that El Dorado Hills sewer bills are 50 percent higher than neighboring communities, water rates have nearly doubled in the last eight years and that overbuilding infrastructure has resulted in the agency’s debt tripling since Norris took office, despite its receiving a portion of property tax as well as hookup fees and service rates, which continue to rise.
One statistic that Norris didn’t contest was that one-third of every dollar paid to EID by ratepayers goes to service district debt, now standing at $392 million.
In explaining his motivation for running against Norris, Day likened himself to disturbed news anchor Howard Beale in the 1976 satire “Network,” who famously ranted how mad he was, and that “I’m not going to take it anymore.”
Day promised, if elected, to immediately ask the board to approve a plan to reduce the operating budget by 10 percent over two years, and to ask the general manager to immediately:
- Freeze all hiring of overhead (headquarters) positions
- Suspend all but $6 million of the $21 million capital budget for 2012.
- Create a plan to lower rates by 5 percent in each of the next two years.
Norris denied charges that rates were going up by either 18 or 28 percent, and that the increase would be held until after the elections.
“Our proposal is on the table now, and it calls for an overall increase of about 5 percent in each of the next two years,” he said. “I don’t see any way around it.”
“I’m saying it’s 28 percent,” said Day. “It depends on the math, and it isn’t locked in stone; that’s why we need to make some changes.”
He also accused the board of holding the prior rate increase until after two incumbent board members were reelected in 2008.
The timing of the next increase has nothing to do with the elections, said Norris. Public meetings on the proposed new rate structure are under way; one was held two days earlier. “We’re not rushing this in, and the election has nothing to do with it,” he said. “That’s just silly.”
Norris also defended EID’s recent rate history, referring to a regional water rate comparison chart that contained “real rates, not scare tactics,” he said.
The chart indicated that EID’s average two-month water rate of $64.48 is lower than all but two surrounding water districts — Citrus Heights and Folsom.
At the top of the list was Elk Grove, where residents pay an average water bill of $152.46.
Norris proudly said his sewer and recycled water constituents actually saw their bills reduced by $10 to $20 in 2009, thanks to the discontinuance of pumping charges, which he championed.
Day countered that the rate reduction Norris boasted was more than offset by a huge increase the same year.
Norris also contested Day’s claim that EID’s debt tripled during his tenure on the board. He checked his notes and quoted EID’s current debt as $392,483,889, up from $260,466,974 when he came on board, a 50 percent increase.
“It’s misleading, its wrong and it’s all over his signs,” Norris complained, arguing that Day wasn’t even asking the right question. “It’s not about how much debt you have; it’s what you spent it on.”
Norris blamed much of the current board’s struggle on $142 million of unfunded mandates ignored by prior boards (which ultimately resulted in fines), a cease-and-desist order and a short-notice rebuild of the troubled Deer Creek wastewater treatment plant.
Norris promised that such irresponsible stewardship is a thing of the past. “We have to plan for the future and not be so rate-centric that we don’t take care of the system,” he said.
Day countered that the mandates occurred before Norris was on the board.
Deer Creek woes
Norris explained that the Central Valley Water Quality Control Board issued a cease-and-desist order that shut down the Deer Creek wastewater treatment plant 10 years ago, the aftermath of which is that EID is required to put 1 million gallons of clean water into Deer Creek every day. “More than it every carried except after a big rain,” he said.
Norris said he would have fought the order if he’d been on the board at the time, adding that the current board may once again take up the fight.
The latest water quality regulations also require the El Dorado Hills wastewater plant to release clean water into Carson Creek, he said.
EID is not alone. Sacramento must now comply with California’s stringent wastewater quality standards, which will eventually drive rates higher than EID’s current rates, he said.
“None of that is germane to the current board,” said Day, who refused to let Norris use Deer Creek as a fiscal excuse, claiming that previous EID boards dealt with the water quality problems and mandates of the 1980s and 1990s.
Norris used the 2010 operating budget, the first of three “essentially flat budgets,” to counter Day’s claim that district spending is out of control. The 2010 budget was reduced by $6 million “in a very difficult way — we let 30 percent of our employees go,” he said.
To cap it off, General Manager Jim Abercrombie kept spending $1 million under budget in 2010, said Norris, who predicted another good performance in 2011.
Day countered that cutting the head count by 30 percent should have been easy because “They over-hired by 30 percent.”
“We certainly weren’t overstaffed and we’re really tight now,” replied Norris.
The capital budget has undergone equally dramatic reductions, according to Norris. “We cut it in half, to $15 million,” he said. “No nice-to-do projects, no projects for growth and just one project for efficiency; the others are all mandated or for safety and security.”
“When you have a couple billion assets in the ground it’s going to take about that much to keep it going,” Norris added, reiterating a theme he repeated throughout the evening, that EID’s extensive infrastructure must be maintained or it will deteriorate and fail.
Norris volunteered that the tight capital budget means that any significant new project might require another bond measure, something that’s not as onerous as it sounds, he said, because long-term borrowing is an effective strategy for spreading the cost of long-term infrastructure investments among all those who will realize its benefit.
Day wasn’t having any of it. “Face the music,” he said. “Stop the spending unless it’s really an emergency. Reduce the debt and reduce rates.”
EID’s overhead, “all the people who sit in that slick new $14 million office building that sits 40 to 50 percent empty,” is “out of control,” said Day, citing overhead costs that rose from $7 million to $17 million, a 143 percent increase, during Norris’ tenure.
During that time, “Field operations stayed even with the consumer price index, about 23 percent” Day said, pointing out that the agency has three public relations people and more vehicles, 175, than field employees.
Norris replied that the agency has only one full-time PR person. The other two are shared resources with other responsibilities.
“We built a Mercedes-Benz treatment plant when a Prius would have been just as good, and maybe more efficient,” said Day. “We have 50 percent excess capacity and who is that for? It’s for future development.”
Norris acknowledged the system’s excess capacity, and explained that it’s due in part to the wet spring and mild summer that has the treatment plants running at 2002 levels, and the water system at 1999 levels.
On the flip side, the late snow melt generated $2 million to $3 million of extra revenue at the district’s hydro plant, he said.
Much of the excess capacity is at the Deer Creek Wastewater Treatment Plant, which was built to serve capacities predicted in the 1996 General Plan, said Norris. Subsequent plan revisions reduced the total residences.
Norris defended the El Dorado Hills plant, which opened on his watch. “It was built to meet new standards,” he said, “And we tried to plan for future growth.”
It has some excess capacity, but much of that was funded by permit fees, rather than ratepayers, Norris said.
Day accused the EID board of building infrastructure in El Dorado Hills as if the housing bubble would continue unabated. “It was poor planning,” he said.
Norris conceded that he’d do things differently if he had known what was coming. “But at the time it looked like a pretty good decision,” he said.
“You should have seen it coming,” said Day. “You can’t go into debt for a half-century for overcapacity.”
“Hindsight is 20-20,” countered Norris, who argued that EID’s large capital projects can have five to 10 year lead times. “You don’t build these things for the capacity on the day they open,” he said.
Day talked about the importance of water rights. “We have to protect our water rights from the Valley folks, from Southern California and from the Delta projects,” he said.
When the discussion turned to Folsom Lake, he softened his stance. “More is not always better,” he said. “We have to stop and ask yourself if you need it, and what’s the cost.”
Norris countered, “You can never have too many water rights,” insisting that, “Water rights are how the district insulates itself from drought, and you can’t wait until you need them. That’s why we’re fighting for more now.”
He recounted the district being granted an additional 18,000 acre feet of Folsom Lake several years ago, and how the Bureau of Reclamation has blocked district efforts to claim those rights thus far.
“If we don’t need those water rights in any given year, we should be able to sell them and lower your rates,” said Norris. “That water is ours and by God we’re going to get it.”
The district has enlisted Congressman Tom McClintock’s assistance in the matter, and Norris was optimistic that they would eventually prevail.
In response to a pointed question about agriculture water being over subsidized, Day said different rates for different types of customers have not always been equitable and, “We need to try to balance things out better.”
Norris explained that until recently, “gentleman farmers” qualified for deeply discounted “small farm” water rates, a legacy of an era when EID encouraged water usage. Norris said he’s always opposed the policy.
A cost of service study identified the inequity and forced the district to eventually discontinue the practice, he said. The gentleman farmers are currently in a one-year grace period which Norris said he also opposed, but lost in a 4-1 vote.
Day continued to hammer Norris on waste and overspending at EID, citing $30,000 of pension and health benefits for each employee. “And the board approved $50 million of retroactive pension benefits for employees, none of which is funded,” he said.
Norris countered that the actual cost of retirement benefits averages less than $17,000 per employee. The board fought the retiree health insurance benefit, he said, but was forced to comply by a court decision. “So we set aside money every year for their retirement and medical benefits.”
Norris agreed that the district’s retirement benefits are excessive, but said the board’s hands are tied because the benefits are dictated by CalPERS.
“This job is difficult for people with normal jobs,” said Norris, recalling that before he retired he had to hire extra employees at the service station to fill in while he attended EID meetings.
Day missed an interview with the Mountain Democrat earlier last week, and as a result was omitted from the paper’s candidate profiles. During the forum he explained, “I was not seeking the Mountain Democrat’s endorsement because I know where their bias lies.”
Finding a date when Day was available for the candidate forum was also difficult, said Norris.
After spending most of the forum defending himself and his board, Norris then struck his loudest blow. “If you can’t find time to come to scheduled debates and you can’t find time to meet the Mountain Democrat it makes me wonder if you’re going to have time to do the job.”
Day shrugged off the attack, denying he had trouble scheduling the forum and promising to be “fully committed to the job” if elected. He insisted that he has a flexible work schedule and “a great team of people covering my back,” adding that the job wouldn’t be more time consuming than campaigning for it.
“What this board needs is some common sense,” said Day, “someone to stop and ask ‘do we really need to spend that money … what’s our return on investment?’”
Norris touted the current board as loaded with common sense. “But just as important, we hired a tight-fisted general manager that I want to make sure sticks around,” he said, recalling that Abercrombie left his last job because the board was “so disruptive he couldn’t get anything done.”
Norris worried that Day is too rate-centric. “We spent too much to come too far,” he said. “I don’t want to slide back to where we were.”
He said he’s also hesitant to turn over the battle for water rights to someone “without that background.”
Norris concluded by saying that the next term will be his last. “I work more hours now than I ever did in my business. I want to do some sailing and get out on the golf course.”
“Harry, I’m going to do all I can to get out there as soon as possible,” quipped Day, earning a smile from Norris.
“I’m not going to overpromise, but I also won’t gloss over EID’s problems,” said Day. “EID is in a deep hole. There’s a new normal in our world and I’m not sure these long-term incumbents get it. The status quo is not sustainable.”
Afterward, Norris’ campaign consultant Dan Dellinger gave his man a positive review. “Harry won this battle because he was able to explain the decisions his board made,” he said. “Day never gave the voters a reason to vote for him; he just attacked EID.”
Reached by phone the next day Day said he was happy with his performance. “Harry and I both did well,” he said. “We got a lot of good information out there. He referred to me as rate-centric and I agree. My focus is lowering our bills by finding ways to make EID more efficient, reduce spending, reduce debt, slow these rate increases and even roll them back if possible.”
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