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FPUD Board approves payment to LAFCO for costs related to analyzing detachment proposal

Fallbrook ratepayers would save $2-3 million a year if detachment goes through

FALLBROOK –The Fallbrook Public Utility District board of directors has approved a payment to the San Diego Local Agency Formation Commission for processing and studying its proposal to leave the San Diego County Water Authority, which district leaders say will save Fallbrook ratepayers millions of dollars a year in water costs.

“LAFCO requires applicants to pay for all costs associated with reviewing and analyzing their proposal,” said FPUD general manager Jack Bebee. “For us, this upfront expense is relatively minimal compared to the money our customers will save if we leave the Water Authority and begin purchasing our water from the Eastern Municipal Water District.”

The $50,000 payment to LAFCO, which was approved by the FPUD board on Feb. 22, will be used to pay consultant Michael Hanemann, who was retained by LAFCO to analyze the proposal and determine what impacts detachment might have on FPUD and other water districts in the region. Hanemann is expected to present his preliminary findings in June.

Last year, FPUD paid LAFCO nearly $85,000 to cover initial staff costs that were incurred to process and review the proposal.

FPUD’s decision to pursue switching water wholesalers was prompted by rising water costs from the Water Authority over the past decade and the fact that FPUD doesn’t need the Water Authority’s pipelines and other facilities. By instead purchasing its water from the Eastern Municipal Water District, which is in southern Riverside County, FPUD expects to save Fallbrook ratepayers $2-3 million a year.

Last March, FPUD submitted its formal application to LAFCO, which is comprised of local elected and appointed officials. LAFCO is responsible for overseeing the establishment and boundary changes of cities and special districts, including water districts.

According to a study released last fall, FPUD and Rainbow Municipal Water District – which is also seeking to leave the Water Authority – have collectively paid $49.5 million more to the Water Authority over the past 10 years when compared to the benefits the districts have received from the Water Authority.

The same study also concluded that if the detachment applications are approved, the financial impacts to customers in the remaining 22 districts served by the Water Authority would be minimal – an estimated increase of only about 50¢ per month, per meter.

In addition to paying less for their water, FPUD and Rainbow maintain that Eastern’s water supply is just as reliable as the supply currently provided by the Water Authority.

The LAFCO board is expected to consider the districts’ applications later this year or in early 2022. If approved, the matter would be brought before voters in Fallbrook and Rainbow for their consideration.

Submitted by Fallbrook Public Utility District.

 

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