EDITORIAL: Considering the Pagosa Springs Town Budget, Part Four
During a particularly difficult period in our marriage, Clarissa and I worked with a counselor named John Walden. One of Mr. Walden’s techniques was to get his clients to travel as far back as possible into their childhood memories, to discover the genesis of psychological “survival strategies” — habits and beliefs that may have been helpful in weathering the storms of childhood, but which have now become impediments to healthy adult relationships.
We were digging into the past, to shine a light on the present. In hopes of a better future.
Now that the approval of the Town’s 2018 budget is behind us, we could — if we wanted — move on to the next exciting project. That’s a common human tendency; to focus on the next big thing and be neglectful of what we built yesterday.
Sometimes it helps to stop, and really take stock of where we’ve been.
So let’s take a short journey into the history of the organization known as the Town of Pagosa Springs… starting on Tuesday evening, December 5. The Town Council was listening to their new Town Manager, Andrea Phillips, deliver some unhappy news about the Pagosa Springs Sanitation General Improvement District (PSSGID).
Basically, the sewer district was going to be operating “in the red” for 2018. A quarter million dollars in the red.
Okay, technically, PSSGID has reserves that will cover the discrepancy between revenues and expenditures for 2018, so PSSGID will not need to borrow money to keep its operations solvent. But… is this a sign that the sewer district cannot pay its bills… going into the future?
From Ms. Phillips’ written summary of the situation:
From a revenue standpoint, in 2018 the District will collect $749,160 in revenue in Taxes and Assessments and Charges for Services. This includes $660,000 in monthly charges for sewer service with the balance of $35,360 in property tax assessments and $7,500 in miscellaneous charges… Total expenditures in all categories for the District is expected to be about $987,301, which includes spending into reserves by $238,141.
The Town’s sewer district is funded mainly through “monthly charges for service.” Sewer fees. Although the Town encompasses most of the older homes in the community, and includes largely a rural working class population, the sewer fees within the Town are relatively high, compared to other Colorado communities — and compared to the rates charged by the Pagosa Area Water and Sanitation District (PAWSD), just up the hill.
Those higher rates were put in place ten years ago when the Town was trying to fund a new “state of the art” sewer treatment plant, to replace its failing lagoon-based treatment facility. In the midst of developing those plans, the Town was approached by the staff of PAWSD, proposing a joint venture — to pump PSSGID sewage uphill to the underutilized PAWSD-owned Vista Treatment Plant, in place of a gravity-fed treatment plant to be owned and operated by PSSGID.
The following months of negotiations by PAWSD staff and Town staff were held mainly in private meetings, and as the details of the (controversial) joint project steadily changed, the public — including both the PAWSD customers and the PSSGID customers — was basically left out of the conversation.
In January 2012, the PAWSD board and the Town Council held a joint meeting to approve an Intergovernmental Agreement (IGA) that had never been seen — let alone analyzed — by any member of the general public. At that meeting, local activist John Bozek stood up to object to the ongoing lack of transparency inherent in the negotiations between two publicly-owned agencies.
At the time Mr. Bozek made the following comments, we had been told that the cost of the proposed sewer pipeline would be about $5 million. As things turned out, the pipeline cost was closer to $9 million — more than the estimated cost of a gravity-fed treatment plant.
“I am personally disappointed in your current lack of transparency, in this issue. Correct me if I am wrong, but I don’t think there has even been a public hearing on this, where a draft of the agreement or a list of bullet-points has been presented to the public. Am I correct on that?”
Mr. Bozek was correct, although then-Town Manager David Mitchem tried his best to make it sound otherwise:
“We have had workshops on this issue where the public — they were open meetings, the public was invited — and the Town Council has had this matter on the agenda in public meetings. So the answer is, yes, we’ve done that, but there has been some refinement in the IGA from our last workshop, and we have copies of those refinements available [today].”
Mr. Bozek pointed to the meeting table where Mr. Mitchem sat surrounded by the members of the PAWSD board and the Town Council members. Everyone at the table was holding a copy of the proposed IGA.
No one in the audience was holding a copy of the document.
“Everybody at that table saw this IGA,” Mr. Bozek asserted. He then turned to the dozen or so citizens seated in the audience. “Did anybody here in this audience see the IGA, or any bullet points? Anybody? Any taxpayers?”
No one from the audience raised a hand.
“That’s what I mean by transparency,” he continued. “And it doesn’t exist.”
“This question is on cost. Is the Town going to pay a premium for wastewater treatment in the PAWSD [Vista] plant? Are they going to pay a premium — or are they going to pay the same, or less, than we the taxpayers in District One?”
Mr. Bozek’s concern, in January 2012, was that the Town was getting a sweet deal, at the expense of the PAWSD customers up the hill, who have been paying off the loan for the Vista Treatment Plant these many years.
As we found out on Tuesday, the Town customers indeed appear to be paying a premium in 2018 — for problems in the pipeline design and for the high cost of electricity to pump their sewage uphill. (One of the problems is odor, in one particular section of the pipeline that runs through a residential neighborhood. On Tuesday, we heard that solving that smelly problem might run $500,000 or more.)
From Ms. Phillips’ summary:
In 2017, an overflow vault was constructed to handle emergency wastewater overflows. Additional expenses for odor control associated with the new pipeline will occur in 2018. Loan payments to PAWSD and CWRPA will continue in 2018 for the pipeline project. In addition, the cost for treatment of the sewage by PAWSD is estimated to increase in 2018 and will be $202,849, a nearly 41% increase from prior years… With expenditures expected to be $987,301 in 2018, it leaves the District with an estimated year-end reserve of approximately $796,163.
The District has not changed monthly rates or plant investment fees in ten years, and a rate study is planned for early 2018.
As we have learned, the term “rate study” is a government code phrase for “rate increases.”