What Are We Doing?

Opposing the Amended EIR Scoping Report (August 18, 2015)

Lori Lamson, Assistant Town Manager
Town of Apple Valley
14955 Dale Evans Parkway
Apple Valley, CA 92307

Via e-mail to [email protected]

Ms. Lamson,

I wish to reiterate my opposition to the Amended EIR Scoping Report in its entirety. Additionally, I wish to object on fourteen specific grounds, related to the Project Objectives, AKA the underlying purpose.

Point 1: The underlying purpose of the proposed Project is for the Town of Apple Valley to acquire, operate, and maintain the existing AVR System.

Objection 1: This purpose contains one or more falsehoods. The obvious falsehood is that Town of Apple Valley (TOAV) even has the ability to operate and/or maintain a water utility. Apple Valley Ranchos Water Company (AVRWC) has two class 5 water operators, and numerous certified employees. Given the relentless attacks on AVRWC by TOAV over the years, few if any of these qualified persons would transition to TOAV to operate and/or maintain the water system (assuming they were even asked), meaning TOAV would have no one with any substantive knowledge of water system operation. The one person typically put forward as the expert for TOAV is Dennis Cron, who doesn’t seem to know the difference between a booster station and a well head, nor the difference between potable water and portable water.

Point 2: Allow the Town to independently own and operate a water production and distribution system;

Objection 2: See Objection 1.

Point 3: Provide for greater transparency and accountability, as well as increased customer service and reliability;

Objection 3: TOAV has been utterly opaque both in terms of its true goals in seizing AVRWC, and in its finances in general. Currently, TOAV is running a deficit both with the Golf Course and in general, while cooking the books to make it appear to the public that things are going great. Also, TOAV continues to hide financial documents from public scrutiny, while publicly claiming not to be hiding anything. TOAV is simply not to be trusted on anything it says at this point. Furthermore, while I have lived in Apple Valley for a decade, I have yet to call Town Hall and actually reach anyone except for the receptionist, which I do not consider to be good customer service. Finally, it bears repeating that TOAV has experience with three different water projects over the last 16 years or so, each of which has come to grief: Apple Valley Water District, the MWA well (through Council Member Art Bishop), and the Apple Valley Golf Course. This history of failure shows TOAV is not, and probably never will be, suited to run a water utility. Evidence of this can be seen in the fact that after TOAV gained water rights through the purchase of Apple Valley Country Club, it immediately transferred all or some of the rights to other entities.

Point 4: Enhance customer service and responsiveness to Apple Valley customers;

Objection 4: With no idea how to operate and/or maintain a water system, there is no way TOAV can make this promise. And, given its financial situation, there is no way it can fulfill this promise no matter how sincere the promise or great the effort, short of massive increases in either water rates, taxes, or both.

Point 5: Provide greater local control over the rate setting process and rate increases;

Objection 5: No one has yet been able to figure out what TOAV means by the vague and misleading term local control. The Town Council Members are not in control of TOAV staff, TOAV farms out its accounting, TOAV has allowed Outer Highway 18 to be destroyed piecemeal (which leaves residents at the mercy of CalTrans!), and Town Council Members are either too lazy to probe into obvious problems in the town, or are willfully ignorant of them. Also, TOAV has increased sewer rates at a faster rate than AVRWC has increased water rates, and unlike AVRWC, there is no oversight for TOAV increases. After securing its last sewer rate increase, TOAV turned around and loaned $7 million from the sewer fund to the general fund to cover a $6.8 million budget shortfall. One Town Council Member referred to this as a surplus, saying, Surpluses are good! And, if TOAV farms out the operation and/or maintenance of the water system to an outside firm, this represents a loss of local control.

Point 6: Provide direct access to locally elected policy makers for the water operations;

Objection 6: We residents currently do not have what I would call direct access to elected officials for current TOAV business. True, we can contact them through e-mail or perhaps voicemail, but they virtually never respond, and never substantively. These are not the people we want running our water system.

Point 7: Allow the Town to pursue grant funding and other types of financing for any future infrastructure needs, including grants and financing options which the CPUC does not allow private company to include in their rate base (such that private companies do not pursue advanced planning and investment for infrastructure); and

Objection 7: AVRWC is a successful company that is a subsidiary of another successful company, and as such has already has figured out the funding for future infrastructure needs. The fact that TOAV is already saying it doesn’t have funding, indicates to me that TOAV will be skimming funds out of the water system and into the general fund, using underhanded and seamy tactics, to the point that there will be nothing left for future infrastructure needs. This means TOAV will be forced to encumber residents with even more debt (atop the mountain of debt needed to complete the condemnation process) to maintain what we have now, let alone for any speculative ventures.

Point 8: Enable the Town to use reclaimed water for public facilities without invoking potential duplication of service issues with AVR.

Objection 8: There is a much easier way of using reclaimed water, and TOAV knows it. TOAV signed an agreement with AVRWC granting AVRWC the exclusive position of water retailer within its service area. AVRWC welcomes the use of reclaimed water, and TOAV knows this, too. TOAV is using this as a ploy in an attempt to justify the necessity of the multi-million dollar mistake it wants to make.

I have some other objections, too.

Objection 9: TOAV now says it wants to use the existing AVRWC facilities. We already have a water system being run out of that building. Thus there is no benefit to ratepayers for TOAV to spend millions to obtain something we already have.

Objection 10: Because TOAV has no employees who can run a water system, it will have no choice but to have another entity (such as the City of Victorville or PERC Water) run the water system. We already have a water system is already being run by an entity outside of the TOAV. Thus there is no benefit to ratepayers for TOAV to spend millions to obtain something we already have.

Objection 11: TOAV has been trying to figure out how to seize Ranchos since 2006, wasting untold millions. No EIR worthy of the name would support this effort.

Objection 12: For TOAV, this is not about water, it is about money. The EIR is a fig leaf behind which they will hide while doing what they have wanted to do anyway.

Objection 13: Not all of the service area of AVRWC is within Apple Valley. Therefore, TOAV does not have jurisdiction over the entire service area, which means either TOAV will not be able to complete this seizure, or will have to pay a premium to divide AVRWC’s service area, which almost certainly means additional millions in costs and expenses. Additionally, it may have to divide AVRWC’s service area and annex unincorporated areas to complete the deal, which means more expense, and potentially tramples the will of those in the unincorporated areas.

Objection 14: TOAV low-ball purchase offer reveals TOAV has no idea what it is buying, or how much it is going to cost. In fact, the way TOAV is structuring the seizure seems to guarantee the highest possible cost to residents. It is clear that TOAV’s only consideration is that it can stick residents and ratepayers with the bond repayments, while it gains control of the cash flow. This is not a valid reason to exercise eminent domain over AVRWC.

I don’t know what the term of art is for it, but the Draft Report must urge TOAV not to pursue this course of action one moment longer. The only logical and ethical choice is the no acquisition option.

— Greg Raven is Co-Chair of Apple Valley Citizens for Government Accountability, and is concerned about quality of life issues.