|  |
 |
|
Lots of Water, Lots of Debt, Part Four |
Bill Hudson | 7/21/08
|
|
|
|
|
|
|
|
|
|
Read Part One
As we left the July 14 San Juan Water Conservancy District meeting in last Friday’s article, board Secretary Jack DeLange was lecturing the audience about the dire necessity of purchasing the Dry Gulch property before land prices went through the ceiling — and of planning ahead for a new reservoir that may take 20 years to build.
Sitting in the small audience was Parelli President Mark Weiler, recently appointed to the Pagosa Springs Town Council and one of the community’s government leaders speaking out for a re-assessment of the current plan by SJWCD and Pagosa Area Water and Sanitation District to build a new 35,000 acre-foot reservoir in Dry Gulch.
 Weiler is by no means one of the anti-development forces arguing to keep Pagosa Springs from growing economically in the interest of saving its small-town character at all costs. He served on developer David Brown’s Community Vision Council and helped conceive that group’s first downtown master plan concept in 2004; he helped the Town of Pagosa Springs initiate its first economic incentives effort; working through Parelli and telephone company CenturyTel, he helped bring big-city-style internet service to Pagosa.
Weiler was also an outspoken supporter of impact fees when the Town and County first began considering that funding mechanism.
Following DeLange’s Dry Gulch lecture, Weiler raised his hand and asked permission to change the direction of the Dry Gulch conversation. Weiler asked if he might pass out copies of a proposal to the board members.
DeLange responded, “I suppose that’s alright, so long as they aren’t poisoned.”
“I assure you, I have handled every one of these sheets of paper, and if they are poisoned, I am going to die right along with you,” Weiler assured the board.
“I think your idea about planning is an excellent one,” Weiler told the board, “and I don’t think there is anyone who has had any quarrel with planning. The quarrel has been the financial side, the financial consequences of whatever you’re going to do. This [proposal] presents a different perspective. The fact of the matter is, the only thing anyone has [complained about in reference to Dry Gulch] is the financial side, as far as I can tell. This proposal presents a way to do that, without massive financial ramifications to the community.”
The current PAWSD and SJWCD plan for a new Dry Gulch Reservoir and distribution network has, so far, been based almost entirely on impact fees levied against new development. Impact fees are a fairly new arrival in Pagosa Springs, though they are common in some other Colorado communities. In most communities, an impact fee is a compromise between two essential questions: "What new capital spending will be required as a result of new residents and businesses moving into the community?" — and — "How much can be charged to those new residents and businesses without scaring them away?"
Critics of PAWSD’s recent Water Resource Fee — as of last month, set at $7210 per residential home and scheduled to go up yearly — have been telling the water districts that their collective fees, especially when layered on top of other PAWSD fees plus the Town’s own impact fees, are helping kill economic growth in Pagosa during a nationwide recession.
The water districts seem intent upon stashing close to $140 million into a savings account over the next 20 years via the new Water Resource Fee, regardless of how such a fee may be affecting the local building industry. The fee is being assessed, not on all future reservoir users, but entirely on the first 20 percent of new users who move to Archuleta County over the next 20 years.
Although PAWSD recently re-worked its fee schedule to be more fair to commercial projects, the fees levied on smaller residential homes appear to have actually increased. And with the building industry in a massive slump, the water districts are so far collecting less than 2 percent of what they originally expected for this year. With growth failing to happen and millions already paid for Dry Gulch land, PAWSD may soon be facing a cash flow crunch unless it greatly increases its monthly water fees charged to existing customers.
The proposal Weiler handed out to the SJWCD — and to the PAWSD board the following evening — did not criticize the Dry Gulch project itself, but rather the funding approach the water districts have taken. Weiler referred to his proposal as the "HBO Method — you're going to pay for it by the month."
“Let us say you wanted to drill for oil in the North Sea off the coast of Norway,” the proposal states, in part. “Would you sum up the total capital costs and then assess each customer a $40,000 oil resource fee before they fill up? No, you charge the cost over the life of the project, gallon by gallon.
“I realize the technical challenges of storing and delivering water are impressive. Try harvesting natural gas underneath a potential war zone in the Middle East, capturing it, cooling and condensing it, transporting it 10,000 miles to a distribution network – a network that can not only leak but explode – and delivering it across a continent. Well, that is what is being done at astronomic cost and with no upfront fees.
“Consider the staggering sums spent to construct the U.S. electric grid or telecommunications and entertainment networks. Hydroelectric dams, nuclear power plants and geosynchronous satellites systems are expensive.
“They are all paid for month by month by all the customers who benefit.
“And we can build this [Dry Gulch] Reservoir Project the same way: month by month, gallon by gallon — And This Is Key — with every new customer welcomed as a new contributor helping to build a community asset, not as a negative impact that has to be remedied.
“The cost: less than it costs to watch HBO. I repeat. Less than it costs to watch HBO.”
The proposal then suggests a funding plan that charges some of the Dry Gulch project to existing customers, and a larger share to new residents — but always allowing district customers to make their payments over the life of the project.
It’s important to note that Weiler’s proposal is based on a 12,500 acre-foot reservoir — a reservoir which would increase Archuleta County’s water storage to four times what is currently available — rather than being based on the 35,000 acre-foot reservoir that presently defines the Water Resource Fees. A 35,000 acre-foot reservoir would increase community water storage by over 10 times our current storage capacity, by my calculations.
Weiler's proposal concludes, “No one is going to decide against moving to Pagosa, or buying a second home here, because of a $17 dollar monthly charge which buys them clean, first run water from wilderness areas atop the Continental Divide. Would anyone prefer to move downstream and drink treated wastewater? Or water laden with mine tailings?
“And people will begin moving to Pagosa again when we extend them a fair deal, and treat them like a valuable addition to our community — to be welcomed and not like a bundle of negative impacts to be cured.”
Weiler discussed his recent conversation with representatives from the Colorado State Demographer’s Office — a source of professional population projections that so far have been summarily rejected by PAWSD and SJWCD in favor of much higher projections formulated by Steve Harris, the Durango engineer who is designing the new Dry Gulch Reservoir.
“I’d like you to consider this proposal,” Weiler concluded. “It’s a different financial alternative to getting to the same result. And I appreciate your perspective about what size [reservoir] should you build. But here’s the question, what financially can you afford to build? And if the growth is not generating in the revenue required, you’re not going to build it anyway. You can’t. This proposal gives you a way to finance a reservoir, in a way that doesn’t hit the people at the front end.”
A few days later, PAWSD representatives Carrie Weiss, Karen Wessels, and Shelley Tressler would be sitting around a table at Town Hall, urging the Archuleta County Board of County Commissioners to reconsider their politically-potent withdrawal of support for the Steve-Harris-sized 35,000 acre-foot Dry Gulch project.
More tomorrow… |
|
|
|
|
|
| |
|