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Fresno Irrigation District Prop 218 April 20, 2017

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Only one of the directors of Fresno Irrigation District’s board of directors met at the City of Clovis’ Counsel Chambers on Thursday, April 20, 2017. Director Chris Woolf stood alone as Director Jerry Prieto who represents the Clovis area was unable to attend. This was not a regular meeting of the board. This was one of those meetings were a lot of numbers were presented. You’d be wise to double check the figures in this report with FID before making any hard and fast decisions. This was a landowner meeting to discuss a 218 election. General Manager Gary Serrato began speaking to about 15 people from the area at around 5:40 pm. There has been a similar meeting in Easton on April 10th and there will be another meeting in Kerman on April 24th. The public hearing will be at FID’s Fresno headquarters at 4:00pm on regular board meeting in June. This is the deadline for casting a ballot. The votes will be counted by an outside consultant. Serrato explained some other points of the law associated with a 218 election.

Serrato said the objective of a 218 land based assessment is to provide for the district’s general fund. In 1984 the water service rate was $17 per acre and the last rate chance was to $40.38 per acre in 2010. The last drought drove home to most districts in the San Joaquin Valley that the fixed expenses can’t be supported by water sales and must be based on land based fees. Serrato said it is true when there is a drought and only one month of deliveries many of the costs will decrease. It doesn’t take as much aquatic weed killer or as many ditch tender miles on the vehicles.

A list of cost increases include: the State Board has instituted a water rights fee. It goes up by nine percent a year. The state spends the majority of this money on hiring new staff to enforce regulations and fee collections. O&M costs for the Friant Canal is going up and the infrastructure is aging. Some of FID’s canals are more than 100-years old. The San Joaquin River restoration is costing water thus raising costs due to less supply. And SGMA is a financial game changer. The state is very good at increasing fees but it doesn’t require itself a 218, it requires the district to raise the money.

Next Serrato explained what cuts FID has made to lower costs. The county now covers the cost of assessment collections. The district has been able to revamp health care, increased developer fees, a hiring freeze and it refinanced its 2007 bonds. Still without an increase by a 218 election within three years FID most likely will have an annual shortfall of more than $1 million. It is also true FID built a new office but due to the age of the older building there was lead and asbestos abatement and it penciled out cheaper to build a new facility.

A slide of what water sales have funded since 2008 was posted. Banking has cost about $6 million. The US Bureau of Reclamation 9D contract cost $3.3 million. That deal saved the district. The SGMA costs have so far ran up to more than half a million dollars. There is still a $5million general fund deficit. The GF used to support all the equipment like trucks and computers. That is running $2 million. The pension fund has cost $6.2 million. The total came to more than $40.4 million. FID has a AA bond rating. He said an ID the size of FID is unheard of.

Assistant GM Bill Stretch then spoke and said FID is big enough to have some responsibilities. There are more than 680 miles of canals and nearly 4,100 turnouts. In the past 10-years the district spent $37 million from canal system improvements and $14 million of that came from outside funding such as grants. A bit more than $10 million came from bonds and the remaining amount just under $13 million came from water sales, transfers and exchanges. Stretch added FID is aggressive about going after grant money and is often successful. The grant funding sources know FID gets the job done.

The $37 million has been spent on: expanding ponding basin for recharge, in pipelines, canal lining, SCADA sites, 30 miles of all-weather roads, monitoring, flume crossings under creeks and a couple of other things.* Stretch went into great detail about pipelines and the need to replace and install new pipes. FID has 160 miles or 45 percent of its pipes are more than 40-years old. It’s expensive to replace pipes. FID spent $2.6 million replacing 3.3 miles of pipes over the past 10-years.

In a tag team move worth of big time wrestling Stretch gave the floor back to Serrato. He said replacing old pipe is better done before something breaks and there is an emergency. The FID board directed staff last month to proceed with a 218 election under Section Four. There are four rate tiers: gravity water service, no FID water – pumping only, pumping from ditch and pumping from ditch using an FID pump. For example at my house where we only pump the current fee is $29.13 per acre. It could increase as much as $9.65 over the course of the year.

Serrato said this election will be determined by growers as cities are sitting out the election but their costs will increase also. Again the assessment is based on the amount of acreage not water used. This translates to $16.15 per a/f and the proposed increase will be $21.50 per a/f. Westlands WD at the other end of the spectrum is currently costing more than $250 per a/f.

He then praised the team that has come together to get SGMA up and running. If the GSA doesn’t get it together the county steps in. That’s not so good. They are not farmers. If the county doesn’t step in the state does and it turns into a big adjudication fight with the state telling landowners how much they can pump. There is a beautiful piece of legislation known as SBX 7 that requires a meter on every turnout. That could cost as much as $40 million. Glen Colusa ID is in the midst of a court trial as we speak. This may provide some relief but it is not likely to do away with the unfunded mandate completely.

The ballots go out in the mail tomorrow and they will be counted June 4th. The increase will show up on the 2018 bills. If this doesn’t pass by 2022 FID’s shortfall will be more than $2million. So, the folks in attendance now know some of the challenges facing their irrigation district. In other 218 elections I believe I’ve heard that just because the district is authorized to raise the assessment to a capped maximum, it doesn’t have to. But again, who knows what new hell lurks in the halls of Sacramento or what drought conditions await us. Disclaimer, I live in FID and we pay the per acre assessment.

DISCLAIMER OF RESPONSIBILITY; Don A. Wright strives to provide his clients with the most complete, up-to-date, and accurate information available. Nevertheless, DAW does not serve as a guarantor of the accuracy or completeness of the information provided, and specifically disclaims any and all responsibility for information that is not accurate, up-to-date, or complete.  DAW’s clients therefore rely on the accuracy, completeness and timeliness of information from DAW entirely at their own risk. The opinions expressed in this report are those of the author and do not represent any advertisers or third parties.

ALL RIGHTS RESERVED.  Copyright 2017 by Don A. Wright   No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of DAW.  *The power point slide moved before I could copy it all down.

Fresno Irrigation District – The Fresno Irrigation District is located at 2907 So. Maple Avenue, Fresno CA 93725 phone 559/233-7161 and meets at 4:00pm on the third Tuesday of the month at district headquarters. FID is part of the Kings River North GSA


Ryan Jacobsen – President, Jerry Prieto – Vice President, Greg Beberian, Christopher Woolf & George Porter


Gary Serrato – General Manager, Bill Stretch – Assistant General Manager, DeAnn Hailey  – Controller,Laurence Kimura  – Engineer,Jeff Boswell – Attorney