Modesto Irrigation District OKs $442.7 million budget for 2014, but no word on rate hikes

10/22/2013 6:12 PM

10/24/2013 12:07 PM

Modesto Irrigation District leaders on Tuesday unanimously approved a $442.7 million budget for 2014 with no hint of whether electricity customers might face rate increases.

A revamped board could take up the sensitive question after three newcomers are elected Nov. 5 to the five-member panel.

Political divisions among leaders were on display once again Tuesday, with Vice Chairman Larry Byrd calling budget numbers “very encouraging” and outgoing board member Tom Van Groningen drawing attention to paltry amounts of money collected from farmers compared to power customers.

Byrd, a rancher, represents a largely rural segment of east Stanislaus County, while most of Van Groningen’s urban district is in northeast Modesto and Riverbank.

“I think we’re headed in the right direction,” said Byrd, noting reserves of about $180 million and a bit less spending than the previous year. “Any more of this, and I’d put a motion on the floor to roll back rates,” continued Byrd, drawing laughs from some in the audience.

MID’s profit margin, or operating expenses subtracted from revenue, has steadily grown in recent years: $25 million in 2010, $55.4 million in 2011 and $73.2 million last year.

Next year, the district expects to get 90 percent of its revenue, or $385 million, from selling power, compared with 5 percent, or $22.8 million, from water sales.

Van Groningen asked pointed questions, at times seeming to exasperate General Manager Roger VanHoy. He and Jimi Netniss, the district’s budget and rates administrator, confirmed that farmers pay $2.5 million of the $22.8 million in water income; the rest includes $1.2 million from San Francisco for its interest in the Tuolumne River and $300,000 from Modesto for canal water treated and mixed with well water for the city’s water customers.

Van Groningen’s questions also confirmed that the budget sets aside no money for replacing a critical century-old flume carrying a main canal across Dry Creek, whose downfall in a disaster could cause millions of dollars of damage to businesses relying on MID water. He said no specific action has been taken despite six years of talking about it.

“Quote, ‘kicking the can down the road’ concerns me,” Van Groningen said. “Should there be a catastrophic event to this 100-year-old facility, to ignore it is not in the district’s best interest, in my opinion.”

MID’s volunteer water advisory committee earlier this year suggested a $2 million fix. VanHoy said the issue should come before board members early next year.

By then, Van Groningen and board members Paul Warda and Glen Wild will be long gone. Eight men are vying for the three open seats.

Six were in Tuesday’s audience, and one, Les Johnson, approached the microphone to urge that budget decisions be left to the future board.

Van Groningen, who also sits on the Stanislaus Workforce Alliance’s board, exchanged angry words with Modesto resident Emerson Drake when Drake questioned a $10,000 budget expense for the alliance. Drake’s inquiries last year figured in a board decision to halve the district’s traditional $20,000 donation to the group, which tries to attract businesses to the area.

In a separate vote, the board unanimously agreed to spend $80,000 monitoring river water quality for fear that pollutants from Rim fire debris will wash down with snowmelt. San Francisco and the Turlock Irrigation District are expected to contribute a third of that cost each, which would reduce MID’s portion to $26,700.

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