OFFICIALS: Temecula Water District Part Of 'Secret Society'

“Either you bring the water to L.A. or you bring L.A. to the water.”

Those famous words were delivered by actor John Huston portraying Noah Cross in the 1974 film “Chinatown.” The movie’s story was inspired by California’s water wars that erupted during the early 20^th century -- and the fight over water continues.

A Rate Hike

Tuesday, the Metropolitan Water District of Southern California approved a 5 percent annual wholesale water rate increase for 2013 and another 5 percent increase in 2014. The increases will begin effective January 2013 and January 2014, respectively, and will affect all tiered water rates.

Following Tuesday’s announcement, opponents immediately went on the attack accusing the giant water wholesaler of operating under a “shadow government” that includes the Western Municipal Water District as one of several of its “ringleaders.”

Western Municipal Water District is a member agency of the Metropolitan Water District. Locally, Rancho California Water District is a member agency of Western Municipal with a waste treatment deal with Eastern Municipal, another member agency of Metropolitan.

“The weighted vote of the Secret Society’s membership – including its ringleaders: the powerful City of Los Angeles Department of Water and Power, the Municipal Water District of Orange County, Western Municipal Water District and West Basin Municipal Water District – is more than enough to assure passage of any vote by the MWD Board of Directors,” according to a website called “The Truth About The Metropolitan Water District of Southern California.”

The website was launched by the San Diego County Water Authority last month. The agency accuses Metropolitan of operating under a veil of secrecy dominated by an all-powerful board that’s anti-San Diego.

San Diego is a Metropolitan customer and is one of six counties served by the water wholesaler.

In a statement released Tuesday on the website regarding the 5 percent hike, San Diego said “MWD’s rates are mostly being driven by reduced water sales, which are down more than 30 percent since 2006.” 

As customers conserve water, their rates only go up, the statement contends, and goes on to read, “MWD’s rate structure favors some member agencies over others, and does not adequately recover the costs to provide some services, while overcharging for other services. Under its rate structure, ratepayers in San Diego will be overcharged by $40 million this year, an amount set to grow with MWD’s approved rate increases for 2013 and 2014.”

The San Diego County Water Authority filed suit over Metropolitan’s 2011 and 2012 wholesale water rates in 2010. The legal challenge is ongoing and alleges Metropolitan overcharges for the transportation of water and uses that money to subsidize the cost of water. 

In 2003, San Diego agreed to buy a big portion of water from California's Imperial Valley in the nation's largest farm-to-city water transfer. But it still needs Metropolitan's 242-mile aqueduct to carry the water from the Colorado River. At the crux of the argument is a Metropolitan rate structure that charges one fee for transporting water and another for the water itself. San Diego claims the transport fee is helping subsidize rates charged to “ringleader” agencies, including Western Municipal Water District.

The Other Side

Metropolitan defends its rate structure and accuses San Diego of trying to unload costs on others.

In a statement released Tuesday, Metropolitan said the two-year plan approved Tuesday came after months of open public meetings and workshops.

“This two-year budget is the result of an open and collaborative process that began in

January and included candid discussions over a number of various budget and rate variations,” Metropolitan board Chairman John V. Foley said in the released statement. “It allows Metropolitan to meet key priorities to ensure reliable water supplies while keeping the cost of our wholesale supplies as low as possible.”

Metropolitan General Manager Jeffrey Kightlinger said the agency’s costs have been increasing, mainly due to an aging system that needs constant repair and upgrade.

Western Municipal Water District Community Affairs Manager Michele McKinney Underwood said customers are priority and Tuesday's rate hike was the best choice given the fiscal realities.

"We pushed for the two-year 5 percent/5 percent Metropolitan rate increase option that was approved yesterday with our intent being to maintain the lowest possible rates," she said.

Western Municipal is also one of several agencies that commissioned an independent economic analysis, which is still in draft form, in trying to understand the costs associated with the water transfer to the San Diego, Underwood continued.

"The draft report indicates that SDCWA’s water rates will have to continue to increase independent of the cost of Metropolitan water," Underwood said.

Agencies that participated in the commissioning included Western Municipal Water District, Eastern Municipal Water District, West Basin Municipal Water District, Inland Empire Utilities Agency, Three Valleys Municipal Water District, Municipal Water District of Orange County and the Los Angeles City Department of Water and Power, Underwood said, noting that the final version is expected to be released by early next week.