Friday, February 10, 2012

Is it a "Pass-Through" or a Hedge Fund?

It's no secret that water rates are always on the rise.  It's also no secret that Fullerton officials have some serious explaining to do about the Water Fund franchise fee.

But when I showed up to the Wednesday evening Water Rate Study Ad Hoc Committee meeting, I had no idea it could and would get worse.

First, some background on "pass-through" costs.  We buy water from Metropolitan Water District of Southern California (MWD) and we pay a pumping tax to the Orange County Water District (OCWD).  Since we pump about 2/3 of our own water we also have to pay Southern California Edison and the City of Anaheim for electricity we use from them. 

As the MWD, OCWD, Edison, and Anaheim raise their rates to us, so must we pass them on to Fullerton water customers.  These are known as "pass-through" costs.

During Wednesday's meeting it was announced that MWD will be raising water rates in January 2013.  (There is an entire background story about MWD water rates that I will ignore for now so as not to put you to sleep.)  Knowing that there will be a MWD rate hike in a year means the City is gearing up to pass those increases to us in July.  So, if MWD rates aren't going up until January, why does the City want to pass-through a non-existent rate hike in July? 

Stay with me on this.  The reason for the preemptive pass-through according to Water System manager Dave Schickling is because the City wants to "smooth the rates".  Instead of raising rates in January and July (OCWD raises their rate in July), they just want to get a head of the curve.  The problem is that the City is raising water rates in July and claiming it as a pass-through when the actual pass-through costs will not change until January. 

That sounds to me like the City of Fullerton is operating a hedge fund of sorts with our Water Fund.  You might even call it a Ponzi scheme since rates never seem to be based on reality.  And we aren't talking about socking the money away for the future either.  As revenue to the Water Fund increases with every rate hike, whether pass-through or not, 10% of the water fund gets moved to cover salaries and benefits of ALL city employees.

Near the end of the meeting there were three motions made.

First, the Committee recommended to the City Council to raise water rates in July consistent with the anticipated pass-through increases.  I voted NO and Adan Ortega Abstained.  It passed.

Second, the Committee recommended that all revenue collected as a result of the pass-through increases be exempt from the franchise fee.  This was, believe it or not, recommended to the Committee by City staff.  I voted NO but probably should have abstained because, although it sounds good, the pass-through as we have seen is not an actual pass-through of rate increases.  The motion passed. 

Third, the Committee recommended that the City's appointed representatives to MWD (Jim Blake) and OCWD (Council Member Don Bankhead) appear before the Committee to explain the nature of the rate hikes by their respective agencies.  I voted YES as did the rest of the Committee.

I will try to articulate my concerns again to the City Council, though by now they have already read this. 

I will try to get a MWD budget briefing posted here in the next week or so.  If you would like to read the budget, you can download it at http://www.mwdh2o.com/mwdh2o/pages/finance/budget/PAB2013.pdf.

Thank you to the residents and business owners who attended the meeting.  Your input is invaluable and much appreciated.  We need more community involvement.

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Greg Sebourn

Orange County Bail Bonds

The Beauty of a Storm

The Beauty of a Storm
Orange County, Ca.

My Grandma - A Eulogy

LET'S TALK ABOUT 1914 FOR A MOMENT.



FOR STARTERS, GRANDMA WAS BORN TUESDAY, DECEMBER 22, 1914 IN HER FAMILY'S ATWOOD RANCH HOUSE.



IT IS WORTH NOTING THOSE ALSO BORN IN 1914:

JACK LALANNE

JOE DIMAGGIO

DANNY THOMAS



AND WHO DIED IN 1914:

JOHN MUIR, THE FAMOUS NATURALIST FOR WHICH NUMEROUS ROADS, PARKS, HOTELS, AND NATURE RESERVES ARE NAMED.



IT IS ALSO WORTH NOTING THAT IN 1914 WOODROW WILSON SIGNS MOTHER'S DAY PROCLAMATION AND BABE RUTH MAKES HIS MAJOR LEAGUE DEBUT WITH THE RED SOX. MOTHER'S DAY AND BASEBALL- TWO OF MY FAVORITES!! (PERHAPS HER NICKNAME "BABE" CAME FROM BABE RUTH???)



GRANDMA WAS BORN INTO A PERIOD OF TIME FILLED WITH TURMOIL. IN JUNE OF 1914 ARCHDUKE FRANZS FERDINAND WAS ASSASSINATED. WITHIN ONE MONTH WORLD WAR I RAGED ACROSS EUROPE. TWO DAYS AFTER HER BIRTH HOWEVER, GERMAN AND BRITISH TROOPS INTERRUPTED WWI TO CELEBRATE CHRISTMAS. (PERHAPS THEY PAUSE KNOWING THAT A GREAT WOMAN WAS BORNE) WORLD WAR I CONTINUED UNTIL THE TREATY OF VERSAILLES IN 1919.



ALTHOUGH SHE WAS ONLY 5 YEARS OLD, SHE SAW THE LEAGUE OF NATIONS CREATED AND THE 19TH AMENDMENT WAS APPROVED BY THE U.S. CONGRESS GUARANTEEING THE RIGHTS OF WOMEN TO VOTE.



SHE LIVED THROUGH MANY NOTABLE EVENTS. LIKE THE 1933 LONG BEACH EARTHQUAKE OR WHEN ATWOOD FLOODED ALONG WITH MOST OF ORANGE COUNTY IN 1938 AND THE FLOOD-WATERS CLAIMED MORE THAN 50 PEOPLE, 43 OF WHICH WERE FROM ATWOOD! ALL OF THIS DURING A TIME THAT WE READ ABOUT IN SCHOOL AND KNOWN AS "THE GREAT DEPRESSION". SOMEWHERE IN ALL OF THAT SHE FOUND THE LOVE OF HER LIFE, GRANDPA LEO, GRADUATED HIGH SCHOOL, GOT MARRIED, AND HAD KIDS!



THEN THERE WAS WORLD WAR II. FROM PEARL HARBOR TO HIROSHIMA, GRANDMA WAS RAISING MY UNCLE BOB AND MOM ARLINE. WITH AIR-RAID SIRENS AND BLACKOUTS SHE WAS A WIFE AND MOTHER. WHAT A TIME TO RAISE CHILDREN! I BET GRANDMA'S PARENTS WERE ABEL TO TELL HER A THING OR TWO ABOUT RAISING KIDS IN WARTIME.



GRANDMA WAS THERE WHEN THE BOY SCOUTS OF AMERICA HELD THEIR 3RD ANNUAL NATIONAL JAMBOREE IN 1953. SHE SAW AIRBASES OPEN IN '42 AND CLOSE IN '99. SHE WATCHED WALTER KNOTT START UP HIS BERRY FARM AND WALT DISNEY TURN ORANGE GROVES AND STRAWBERRY PATCHES INTO DISNEYLAND!



SHE SAW THE HORSE AND CARRIAGE FADE AWAY INTO HISTORY AND SPACE TRAVEL EXPLODE BEFORE HER WITH THE FIRST LUNAR LANDING. JUST IMAGINE HOW MUCH TECHNOLOGY HAS CHANGED OVER THE LAST 100 YEARS. FROM TUBE RECTIFIERS TO SUPERCONDUCTORS; FROM TRANS-ATLANTIC TELEGRAPH CABLES TO SATELLITE TV.



SHE SAW MORE IN HER 93 YEARS THAN MOST OF US WILL EVER READ ABOUT, LET ALONE LIVE THROUGH!



OF THOSE 93 YEARS IT IS MY HONOR TO HAVE BEEN HER GRANDSON FOR 35 OF THEM. SHE WAS MY MOTHER WHEN MOM HAD TO WORK. SHE WIPED MY NOSE AND PUT FOOD IN MY MOUTH. SHE LET ME PLAY WITH GRANDPA EVEN THOUGH SHE NEEDED HIM TO TAKE HER TO THE STORE. SHE WAS MY GRANDMA AND I WILL MISS HER IMMENSELY.



JUST LOOK AROUND THIS ROOM; SHE DID THIS. SHE IS RESPONSIBLE FOR BRINGING SO MANY GOOD PEOPLE INTO THIS WORLD AND TOGETHER TODAY. THIS IS HER LEGACY.



A Dedication To My Loving Wife, Stacey. Thank you for all you do for me!

Brad Paisley - I Thought I Loved You Then


I remember trying not to stare the night that I first met you
You had me mesmerized
3 weeks later in the front porch light taking 45 min to kiss you goodnight
I hadn’t told you yet but I thought I loved you then

Chorus
Now you’re my whole life now you’re my whole world
I just can’t believe the way I feel about you girl
Like a river meets the sea
Stronger than it’s ever been
We’ve come so far since that day
And I thought I loved you then.

I remember taking you back to right where I first met you
You were so surprised
There were people around
But I didn’t care I got down on one knee right there
And once again I thought I loved you then

Chorus
Now you’re my whole life now you’re my whole world
I just can’t believe the way I feel about you girl
Like a river meets the sea
Stronger than it’s ever been
We’ve come so far since that day
And I thought I loved you then.

I can just see you with a baby on the way
I can just see you when your hair is turning gray
What I can’t see is how I’m ever gonna love you more
But I’ve said that before.

Now you’re my whole life now you’re my whole world
I just can’t believe the way I feel about you girl
Well look back some day at this moment that we’re in
And I'll look at you and say I thought I loved you then
And I thought I loved you then...

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