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Proprietor’s note: Tom Moore, an exceptionally well qualified member of the Marina Coast Water District‘s board, posted the following as a response to a previous Partisan post regarding the wisdom of private v. public ownership, a subject of current interest because of a looming effort to put privately owned Cal Am water under public ownership. As it stands, the group Public Water Now is expected to sponsor a ballot measure that would require a public buyout of the water utility and put it under the management of the Monterey Peninsula Water Management District, which is governed by a board of elected officials.  Moore did not intend this to be a standalone commentary, but it deserves more attention than it would have received otherwise.

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Point 1: The vast majority of public sector organizations, for-profit organizations and non-profit organizations provide significant benefits for their clients and society, at a cost that is as reasonable as their physical, legal and market circumstances allow.

Point 2: If you insist on clinging to the myth that all government organizations are inefficient, inept and run by lazy, overpaid bureaucrats then:

a. You must notify your local fire and police departments, along with the county 911 Center that they must NEVER respond to a phone call or alarm from your home. You must also never accept medical treatment under any circumstances from Salinas Valley Memorial Hospital. To do otherwise makes you a hypocrite.

b. If you really insist on dueling over the issue, then: AIG, ENRON (“Smartest Guys in the Room”), Bernie Madoff, Wells Fargo Bank, IndyMac Bank, Washington Mutual Bank, Bethlehem Steel, White Star Lines (owners of the Titanic), Pan Am, Eastern Airlines, Drexel Burnham Lambert, Bank of Credit and Commerce International, Union Carbide (Bhopal killings), PG&E (recent San Bruno killings), Three Mile Island, Exxon Valdez. How many trillions of dollars were wasted and innocent people injured or killed by these “efficient” private companies?

Point 3: How much do you think Cal Am would charge its customers if it was not regulated by the CPUC and instead all its water rates were set at the sole discretion of the Cal Am Board of Directors?

Point 4: The CPUC regulatory process is arcane, complex, difficult, time consuming and, above all, expensive for everyone involved. Hundreds of thousands of dollars and years can be spent on a given Cal Am rate setting process. The CPUC exists only so that a private company can be in a line of business that must, of necessity, be a monopoly (such as a utility).

Point 5: Marina Coast Water District is a government organization. Its Board of Directors consists of five locally elected citizens who are paid all of $50 per month. This Board meets one to two times a month. All meetings are held locally, not in San Francisco or New Jersey. The public is even welcome to attend these meetings. (Just try to get into a Board meeting at Cal Am, if you can even find out where and when they are meeting….).

Point 6: Marina Coast is beholden ONLY to its customers and the local voters. There are no shareholders to keep happy and no stock price to worry about. By law Marina Coast rates contain no profit and MUST be reasonably related to the actual cost of providing water and wastewater services. When a new rate plan is developed, it is put together for the next 3-5 years. It takes only about four months to develop and approve such a rate plan. The cost of a new rate plan is less than $50,000, including consultants and staff time. And all Board deliberations on new rate plans are done locally and open to the public. The public even gets to weigh in on new rate plans via the Proposition 218 process. So who is the inefficient bureaucracy here: the government owned utility or the privately owned monopoly?

Point 7: Points 5 and 6 can be repeated (with a couple of slight adjustments) for the Monterey Regional Water Pollution Control Agency (MRWPCA). Note: with the cooperation and assistance of the Marina Coast Water District, the MRWPCA will soon be bringing the Cal Am service area 3,500 acre-feet per year of new water. This is the largest amount of new water for the Cal Am service area that has been developed in the past 22 years. And guess what? The MRWPCA is a government owned utility.

Comments on this entry are closed.

  • Patty Cramer April 17, 2017, 6:32 pm

    I totally respect Tom Moore. He is honest, intelligent and understand water. I think Cal Am is way over due for a takeover. They have cost the taxpayers royally and the citizens deserve a break. Water is the new gasoline. Thank you Tom, for your response and wisdom!!

  • john moore April 17, 2017, 7:01 pm

    I favor a buy out of Cal Am, but the Monterey Water Management District rivals CalAm for a parasitic existence. As to the claim that it and the pollution control district will create 3500 acre/feet of new water out of toxic waste, that project is a beta site, at best; and it doesn’t create 3500 acre feet of drinking water, it treats sewage and agricultural waste, and pours it into a local aquafir for further processing to drinking water standards. It is a hugely expensive and uncertain project. I truly hope that it succeeds.

    I am a fan of the Marina Coast Water District. If the original concept for a desal project been left in its hands, it would have been completed by 2011 or 2012 and this water nightmare would not threaten every aspect of local life.

    • Melodie Chrislock April 17, 2017, 9:39 pm

      The Pure Water Monterey model plant running now is creating drinking water out of sewer water. I drank it! Great tasting water. It’s true it will be put into the aquifer for 6 months, but that’s not because it’s not pure enough to drink after the process.

    • Royal Calkins April 17, 2017, 11:13 pm

      John, do you really mean to say that the water management district is an inherently bad thing? Its mission has changed a couple times since its inception, principally as a result of changes in the public will. At one point, its mission was to seek additional water supplies. At another, it was seen as a regulator of Cal Am and water use in general, and at yet another time its publicly assigned role was merely conservation and resistance to growth-inducing water projects. In the upcoming ballot, Cal Am will undoubtedly continue trying to convince people that it is an incompetent agency when, the fact is, there is nothing to prevent it from becoming an entirely professional operator of various water projects if the public decides that’s what it wants. Already good things are happening. Dave Potter and David Pendergrass are no longer on the board, removing a thick layer of corrosive politics from the agency.

      • john moore April 18, 2017, 8:03 am

        I judge a governmental unit by its honesty and its achievements. The Water Management District has wasted tens of millions of dollars. It has fought for new development, in spite of a CDO. It is a redundant district that should conduct its business through the county public works dept. But for the hard work of citizen Luke Colleti, the District would have provided water for a new 225 room hotel in spite of a restraining order that prohibits new development.

      • Ron Chesshire April 18, 2017, 9:17 am

        Yes Royal, the mission of the District has changed because of politics. In fact the creation of the District was very political since a Water Management District was created not a Water District which has allowed those elected to shift their focus from water procurement to other things. That’s why we are still trying to take care of a problem that was realized over 40 years ago. That problem was we didn’t have enough water to meet our needs. Then it became a problem of preserving the Carmel River. Then the CPUC was cast upon us by Fred Keeley to fix the problem? No, to continue to delay the process and shift the emphasis of the need.

        It will be the height of insanity to go through over 40 years of process and only get enough water to remedy the SWRCB Order 95-10. But, this is what we may get since the decision has been taken out the hands of the People. Thanks Fred, !%&^*$#@.

        The highly touted 3500 acre feet of “new” water won’t do anything at this time. It won’t go to build one new bathroom, one new office or business, or one new school. It is only part of a solution that has not been fully acted on by the CPUC. An action which may get us no further ahead than we were in Jan. 1, 1978 (start of the MPWMD).

        Water projects are usually not built to just fix an old problem, like a shortage of water at a set point in history in the mid 1970’s. They are also built to provide for the future. If the CPUC does not rule on a project which will do this then the politics of Mello, Farr, Keeley and others which was to take the land use decision making process out of the hands of the jurisdictions and put it in the political realm of a District with multiple missions (goals) will be realized. If they were so sincere about putting all things that could affect water into one ruling government agency they would have merged the duties of the Water Pollution Control Agency into one big WATER AGENCY in control of all facets of water.

        Cal AM has done many things to try and bring water to our area and they have been rejected. Now we have to put up with a decision made by a State Agency to determine our future. Cal Am has played the game by the rules they are allowed and we have been stuck on the bench hoping to get into the game. The decision will not be ours and as I have said before, I have seen the enemy and they are us. The question of buying Cal Am is one that will be decided again. I can only hope this is not another distraction to delay things. Whether we buy Cal Am or not we need a governing agency which will provide water for our current and future needs. This has not been the case with the MPWMD and the will of the people will change once they find out they have spent millions of dollars to be no further ahead than they were on Jan. 1, 1978.

        As Tom said, the Marina Coast Water District is an agency created to take care of its customers. Now, Cal Am is a business created to make money from water sales to customers and the Monterey Peninsula Water Management District has no customers. Two of these groups have to answer to customers and one is highly political by the nature of its formation. If Cal Am is purchased we need a Municipal Owned Water District just like Marina Coast and not a regulatory Water Management District that can’t figure out what its mission is.

  • jd stayton April 17, 2017, 8:11 pm

    The very idea that WATER, which is the one thing human beings cannot live more than a few days without, should be privately owned by a “for-profit” company is absolutely insane. Water must be publicly owned in order to be guaranteed available for all. Who’s idea was it anyway to sell our very lives to a group of stockholders? It’s time to take back our control of our own water.

  • Reginald V. Wedge April 17, 2017, 8:40 pm

    Water must be a publicly owned utility! Period. No ifs, ands or buts.

    • john moore April 17, 2017, 8:54 pm

      Agreed. But never say that it can’t get worse, it can. A take over of CalAm must be carefully planned, otherwise, it could be tragic. A few years ago, a county in Alabama built a state of the art sewage treatment facility that became so expensive that the county went into a chapter 9 in bankruptcy.

  • L. Parrish April 17, 2017, 11:07 pm

    Tom – You forgot WorldCom, Global Crossing, and hundreds (thousands, actually) of other corporations that have gone bankrupt and ran off with investor money, including a number of DJ Trump businesses. (Remember the GW Bush savings and loan disasters?)
    More than 90% of new businesses go under in their first year. That’s the nature of the free market. And Samuels probably thinks that’s wonderful. I’m not advocating for all government entities, but let’s at least start the conversation with the facts. Tom has done that.

  • bill hood April 18, 2017, 9:06 am

    Tom – an excellent commentary – I have two comments on your point #4 regarding the CPUC process. First, it has all the troubling aspects that you describe, but the most troubling aspect is a combination of all your descriptions in that the process is essentially inaccessible to those with serious concerns but without means to significantly participate in the process, plus the history of the agency in its unfair and consistent favoritism toward utilities, in the face of its statutory responsibility to equally protect the interests of both the utilities and their customers. Second, the concept that regulated utilities necessarily have to act as monopolies. In Ohio, the PUCO has created market incentives that allow gas and electric companies to compete with each other with respect to rates. Since the Columbus metro area (1.26MM) gets water from a public agency (the City of Columbus) that competive rates are not available. And, just for the record, although I am sure public water here is less than if Cal-Am were its purveyor, it is not cheap and the city council regularly approves rate hikes. In other words, neither public nor private are lily-white, although the white is brighter on the public side.