What Are We Doing?
Opposing the hostile takeover of Liberty Apple Valley
Within days of being notified of a proposed ballot initiative to force a vote on this issue (
Say in water war sought, Daily Press, December 22, 2015), the Town cranked up its propaganda machine again, this time promising to lower water rates after the takeover.
[…] After more analysis, we do believe the town can actually lower water rates. That depends on the final purchase price, of course, but if it is reasonable, the town believes it can purchase the system, pay off the debt it will incur to buy the system, and then lower the water rates.Town of Apple Valley, Facebook
Let me see if I understand this. The Town of Apple Valley says Apple Valley Ranchos Water Company is worth $50 million, even though the recent sale to Liberty Utilities shows its starting price is at least twice that. Even its own Blue Ribbon Water Committee said the price of Ranchos back in 2011 might be as high as $200 million, which was one of the reasons it recommended against the purchase. Since 2011, of course, there has been inflation, and Ranchos has invested further millions into system maintenance and improvements.
Additionally, interest rates are going up. The last interest rate increase potentially increased the cost of the Town’s hostile takeover of Ranchos by ten million dollars, and analysts predict further interest rate increases in our future. This is money that doesn’t buy a drop of water, and it doesn’t go to Ranchos or Liberty Utilities to justify the costs and risks of further investments in our community. No, instead it all goes toward interest payments: Once paid, that money is just gone.
Before, when both the purchase price and the cost of borrowing were lower, the Town stated with some certainty that it would not be lowering rates (in fact, the higher rates were baked into the Town’s financial models). Now with the price of Ranchos and the price of loans going up, the Town can promise lower rates?
This all goes to show yet again that the Town doesn’t know what it’s buying, it doesn’t know what it’s going to cost, it doesn’t know where the money is coming from, doesn’t know what the money is going to cost, and doesn’t know what it’s going to cost to run our water system. This last item is no surprise, given the Town’s history of failure where water systems are concerned, yet it can now promise that rates might go down?
The Town must have just gotten some new information from its financial whiz, innumerate Assistant Town Manager Marc Puckett, who has problems counting, adding, and duplicating figures across multiple pages of reports.
Despite our groundwater levels going down and the Town pushing to bring in more persons and businesses, water wasters can rejoice in the promise of lower water rates, once the Town takes over.
Does anyone actually believe this hooey? No wonder the Town stopped producing its
— Greg Raven is Co-Chair of Apple Valley Citizens for Government Accountability, and is concerned about quality of life issues.