El Dorado Irrigation District customers should be aware of two items of EID news. One is new information on California water rates throughout California in 2011, the other is 2012 audit results adopted at the Monday, June 24, board meeting. The rate survey used a benchmark of monthly cost when consuming 1,500 cubic feet of water (11,220 gallons).
EID rates were the 46th lowest among 216 agencies: 45 agencies were cheaper, 170 agencies were more expensive. Among 15 Sacramento area agencies, EID was second-cheapest — $1.52 per month above the lowest rate in our area, $88.09 below the highest rate.
If this surprises customers who think EID’s rates are exceptionally high, the surprise is appropriate: This is real-world data, not an opinion, not a distortion. Bar graphs and tables are posted on sierrafoot.org.
Monday’s EID board meeting was attended by EID’s independent auditors, but not by any of the vocal critics. One of those critics already had written publicly about “deepening financial woes” and “a net loss of $10.8 million.” That claim simply doesn’t hold water. One indirect recognition of the truth was that Standard & Poors and Moody’s upgraded EID’s ratings from “A” to “A+” and “A1.”
EID’s total budget had a total cash surplus of $16 million. The “Net Position”calculation adds in a big paper cost to write down Depreciation and Amortization — $21.4 million in this case. That produces a “Net Position” paper deficit of $5.4 million decline in “Net Position.” The EID critic, a gent from Cameron Park, ignored the difference between cash flow and change in net assets, as well as ignored $5.4 million in cash revenue from Capital Contributions. That was another $5.4 million in 2012.
Thus, this gent claims a $16 million cash surplus is a $10.8 million loss. The cash surplus isn’t overbilling, its most directly relevant use would be to cover the future actual cost of replacing the depreciated infrastructure as it ages. Another use might be to cover unfunded pension liability.
EID has been making 100 percent of the required payments to CalPERS. The unfunded pension liability arose when CalPERS investments declined in value during “the Great Recession.” EID began addressing this in 2011 by joining the newly-formed CERBT, California Employers’ Retiree Benefit Trust Fund. EID’s first payment to CERBT was $6 million in 2012, paid from reserves.
The bottom line is that it’s not EID that functions poorly; on the whole, EID has demonstrated very high competence. We in the public need to recognize that the real issue is those among us who choose to believe in an alternate reality that simply isn’t true.
El Dorado Hills