As questions swirl, MID suggests scrutinizing cost, value of canal water

MODESTO -- Irrigation leaders Tuesday called for a potentially divisive debate aimed at pinpointing the true costs and value of canal water.

No one ever has arrived at meaningful answers to complex questions that stretch far beyond farmers to city folk and City Hall, Modesto Irrigation District officials said.

Meanwhile, the MID board scheduled a hearing April 9 on a related proposal to raise farmers' water rates 10 percent.

Board member Larry Byrd said he wants solid numbers justifying the hike because he doesn't want to run small growers out of business.

Others pointed to an engineering report suggesting that the MID's 113,000 electricity customers are paying far more than their fair share to keep water rates for 3,100 farmers artificially low.

Board member Glen Wild wondered whether it makes more sense to consider a 30 percent increase in water rates. That can't happen because Tuesday's action setting the April hearing prevents the MID from seeking more than a 10 percent hike, although the board could opt for a lower amount.

"How accurate are these numbers? We don't know because we haven't peeled the onion yet," said Byrd, employing a metaphor cited several times Tuesday to describe the many layers of unexplored factors affecting rates.

The engineering report says farmers pay about half of the district's $4.2 million annual revenue from selling water; Modesto pays another portion for river water that is transformed into tap water at a water treatment plant.

That money covers only a fraction of the theoretical price of delivering canal water, figured to be $17.4 million. The gap is bridged by power customers — homeowners, stores, factories and everyone else buying electricity — at an average cost of $116 this year, according to computations based on the district's report.

Byrd said he doesn't appreciate wedges driven between rural and city folk. He traced the division to last year's fervent debate over selling water to San Francisco, an idea dropped in September. "We are a family here," Byrd said. "What I don't want is for us to become enemies with each other."

An MID attorney last year privately advised the board that the inequity could cause legal trouble with a new state law tying fees to actual costs.

Walt Ward, the MID's assistant general manager for water operations, said pinpointing true value is tricky, with many layers to peel and examine.

For example, the district doesn't pay Modesto a franchise fee that could be worth $3 million to $4 million a year. In return, the city pays nothing for canals that drain away storm water; building alternate drains could cost hundreds of millions of dollars, Ward said.

Also, irrigators get no credit for replenishing groundwater needed by wells.

Examine expenses?

Even the district's overhead — figured into yearly expenses at $6 million this year — could be called into question, Ward said, calling onion layers a "hugely important subject" that the district historically has avoided tackling.

"I think we need a healthy debate on it," he said. Several people on the board and in the audience agreed.

Modesto farmer Jake Wenger said growers generally acknowledge that others elsewhere pay far steeper prices for irrigation, but said an exorbitant increase probably isn't right. "This is going to be a sensitive issue," he said.

"It's a fascinating debate that we all need to engage in," said Modesto resident Emerson Drake. "Please have that exciting conversation, with champions on both sides. I want to hear it."

Jim Mortensen, chairman of an advisory committee, said the group hopes by May to present recommendations to improve the district's canal system. Although its findings are eagerly anticipated and could affect the onion debate, the committee was not charged with justifying water rates, board member Tom Van Groningen noted.

Growers have a say

Growers soon will be notified of the proposed 10 percent increase, from $29.50 to $32.50 per acre for a 3-foot base allotment, or $9.83 per acre-foot to $10.83 per acre-foot of water. The rate hike could be killed if a majority of customers file written protests, but that almost never happens.

Bee staff writer Garth Stapley can be reached at gstapley@modbee.com or (209) 578-2390.