SP wastewater treatment users to see rebate
April 15, 2016
By Peggy Kelly
Santa Paula News
It’s coming closer to the day that Santa Paula utility users will open up their billing and voila! There will be a base charge of $17 and change, a $60 dollar drop from the regular base change for sewer services.
The rebate became official at the April 4 City Council meeting where the panel heard there is enough funds to allow the hefty kickback at the rate of $20 for January, February and March.
The $60 rebate according to Finance Director Sandy Easley, was finalized at the council’s Ad Hoc Committee meeting of March 15 by members Mayor Martin Hernandez and Councilman Jim Tovias.
Terry Maas of First Southwest, the city’s bond consultant who helped arrange the April 2015 city purchase of the city’s wastewater treatment plant, told the council an effort was made to make the rebate program “flexible enough for extraordinary expenses,” that could require funds.
The October spill at the plant, operated by PERC, who had been part of the original $60 million Design/Build/Operate/Finance deal to create the privately owned facility, “cost almost $1 million,” said Maas, who did not comment further on who has the financial responsibility for the 280,000 galloon spill.
The ratio accounting base for the $70.8 million in bonds the city used to purchase the plant, agreed to by a council majority in 2008 and completed in 2010, is 1.5 times in cash flow.
Such funds must be used for a “calamity payment” if needed.
There are approximately 6,300 accounts that will receive the $60 rebate, a total of approximately $378,000.
Maas told the council when the Ad Hoc Committee meets again in June, “They’ll again sift through the numbers and see what the next round may be. Another factor coming into play here is the bid on the O&M contract,” now held by PERC.
Maas said once the contract is finalized with either PERC or a new operator, “We’ll have a better handle on what the cash flow will be…”
For now, “This is a good start,” that he complimented Easley and staff on for their work on establishing the rebate program.
Councilwoman Ginger Gherardi asked when the next rebate would be and learned it will cover the period of April, May and June and be reflected on the July statement.
The almost $1 million in spill costs has become the focus of what could become legal wrangling said Maas.
“It’s not easy to get PERC to come to the table,” for discussions and there has been talk of court action.
Aside from the base charge sewer customers will still be liable for the water processing charge, which costs $1.12 per hundred cubic feet, which equals 748 gallons.
