Water Panel Won’t Go With the Flow

SAN CLEMENTE —  The sentiment was widespread: A small water district in South County with overlapping jurisdiction had become impractical. It was deemed an unnecessary layer of government.

So the grand jury recommended consolidating the Tri-Cities Municipal Water District with another agency.

“Ninety-nine percent of their customers want them to go away,” said James Holloway, San Clemente community development director. “Their own in-house committee recommended consolidation, and the city and [neighboring] Coastal Municipal Water District want them to go away.”

Although perhaps harsh, the anti-government attitude was spawned in the aftermath of Orange County’s bankruptcy, a time when a series of recommendations targeted the county’s multilayered special districts handling everything from sanitation to libraries.

The grand jury urged streamlining to make government more efficient. In an era of rapidly rising water rates, consumers are paying too much for water, partly because of government inefficiency, the county panel found.

*

Tri-Cities, which operates on a $13-million annual budget, owns a pipeline and serves about 70,000 customers as an intermediary in the county’s water-delivery system. It wholesales water to local districts and the city of San Clemente, which has its own water department.

The agency only has about three field employees and it hires outside consultants for management, public relations and accounting.

So what is happening to Tri-Cities? The county’s Local Agency Formation Commission voted Aug. 5 to dissolve the 37-year-old water agency, but Tri-Cities board members have vowed to fight.

“It’s much more politics than anything,” said James Lawson, a retired UC Irvine director of architecture and construction and 11-year member of the Tri-Cities board.

Lawson wants Tri-Cities to appeal LAFCO’s decision and, if the appeal fails, file a lawsuit aiming to put the issue before voters.

“You know, the recommendations made for Tri-Cities were to consolidate, not dissolve,” Lawson said. “A consolidation is maybe you eliminate one or two boards by forming only one district. Dissolution is doing away with the district entirely and giving the assets away. My objection is that when you dissolve the district, $35 million in assets and $2.5 million in reserves go to the city of San Clemente.”

*

Dana M. Smith, LAFCO’s executive officer, who has had experience with mergers, consolidations and dissolving districts, said such procedures are never easy.

“It’s so hard. And when the bell is rung, usually it’s the directors who don’t want to go away, and that’s what you have here,” Smith said. “There is no other overlapping district in Orange County. . . . Their own clients filed the request for them to be dissolved.”

In recommending dissolution to LAFCO commissioners, Smith cited cost reductions of $363,700 to $476,200 should the agency be operated by San Clemente.

Lawson said Tri-Cities’ opposition isn’t a matter of board members feeding their egos but of anger that assets from the regional agency must be turned over to a city.

In addition, Tri-Cities counters Smith’s cost-saving figures with an estimate that taxpayers would save only about $15,000. (In her recommendation, Smith did note that a loss of $266,000 in property tax revenue from Tri-Cities customers in San Diego County would reduce overall savings.)

The Tri-Cities service area includes the San Onofre Nuclear Generating Station and state parks in north San Diego County.

*

While LAFCO has approved the dissolution of Tri-Cities and designated San Clemente as the successor agency, it will be at least 60 days before the issue is taken up by the Orange County Board of Supervisors, Smith said.

“We’re eliminating a layer of government that is unnecessary and there are substantial cost savings that will accrue to taxpayers,” Smith said. “San Clemente will take over its responsibility because it’s bigger and can handle the additional load.”

As for Lawson, he fears that San Clemente may use Tri-Cities’ reserves to help the cash-strapped municipality and not for water projects as intended. But the city’s Holloway said that by law, the money must go into a special fund and cannot be used for the general budget.

“I want it to go to an election,” Lawson said, “because as far as I’m concerned, that will put their feet to the fire and show everyone how they divide up the assets.”