FPUD will use rate rebate to reduce loan on local river project

FALLBROOK – The Fallbrook Public Utility District Board of Directors voted to use a $909,412.67 refund from the San Diego County Water Authority to reduce the loan on the Santa Margarita River Conjunctive Use Project.

The reduction in debt will save the district approximately $40,000 per year for the next 30 years. It will also result in a savings of $275,000 in interest expenses on the loan.

The April 26 FPUD board vote was unanimous.

The Water Authority recently received a $44.4 million rebate from its wholesaler,

Metropolitan Water District of Southern California, after 10 years of rate litigation between the two agencies. The Water Authority distributed the refund to its 24 member agencies in March.

“We felt the best way to use the rebate is to reduce the loan,” said Don McDougal, who is on the FPUD board. “This is the best value to the ratepayers to keep down the cost of water.”

McDougal is one of the two special board committee members assigned the task of

studying the issue, and then making a recommendation to the full board on how to best use the refund. The other board committee member is Charley Wolk.

They looked at three options: offsetting operating costs for calendar year 2023, adding the refund to the district’s reserves, or paying down the loan.

“This will reduce the long term cost of water,” said FPUD General Manager Jack Bebee. “It will be our best return on investment and help ensure we have lower water costs.”

The Santa Margarita River Project will provide local water to Fallbrook, and put an end to the district having to buy 100% imported water, which continues to rise in cost. The project is on budget and ahead of schedule. Local water will be pouring from Fallbrook taps by the year’s end, and will make up about 50% of Fallbrook’s water supply.

Here’s how it will work: Water from the river will be collected at the Marine base and stored temporarily underground. Some of the water will be kept for use on the base while some will be pumped back to Fallbrook through a new pipeline.

Here, it will be processed in a new treatment facility, which is now under construction on Alturas Road along with a new pump station and reservoir. Once treated, the water will be distributed to Fallbrook water customers.