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Water agency to mull over budget

Posted: June 17, 2008 1:34 a.m.
Updated: August 18, 2008 5:01 a.m.

Fewer homes built in Santa Clarita mean fewer taps being turned on, which now means less money for the Castaic Lake Water Agency.

When the water stops flowing, so does money into the water agency.

Members of the agency's Finance and Administration Committee are expected to detail revenue shortfalls tonight when it adopts an amended budget for the fiscal year 2008/09, which reflects thousands of dollars in lost revenue.

The committee will then recommend that the agency's Board of Directors endorse the amended budget when it meets later this month.

With revenues anticipated at slightly more than $69 million and costs expected to total more than $110.2 million, the agency is looking at a budget of about $103.1 million dollars.

Most significantly, the agency will be about $800,000 short on what it had expected to collect from developers in the way of Facility Capacity Fees.

The committee meets tonight at a public meeting at its Rio Vista Water Treatment Plant on Bouquet Canyon Road, overlooking Central Park.

The fees, which are set yearly through a public hearing process, are paid to the agency by developers or property owners within the water service area before any building permits are issued.

Santa Clarita, like the rest of the nation, has noticed a sharp downturn however in the housing development market.

The committee is also reporting "minor changes" to reductions on two cost fronts.

The agency would normally have paid the Department of Water Resources $1.8 million in Delta Conveyance Charges for water moved here from Northern California. This year, it's expected to pay only $800,000.

Reductions have almost been made to the amount of money it will cost to finish two capital improvement programs: the Honby Parallel project and the expansion project at the main Rio Vista Water Treatment Plant.

With regards to shortfalls in property tax revenues, hundreds, perhaps thousands, of Santa Clarita homeowners are expected to receive refunds from the county averaging around $660 per household following an ongoing reassessment of diminished local property values.

The agency is expecting to collect $21 million this year in property tax revenues in light of the dropping house values.

In March, County Assessor Rick Auerbach announced that his staff reviewing approximately 310,000 single family homes and condos for a potential decline in value reassessment - many of them in Santa Clarita.

The assessor learned a lesson from the last downturn in property values almost two decades ago and decided to address the issue first, before homeowners started filing complaints.

Diminished property values, mean less tax dollars collected which means less money allocated to the local water agency.

This budget lists the agency having a reserve of about $143 million.

Its total expenditures for this fiscal year are budgeted at $110.3 million which includes operating costs totaling $14.6 million, capital improvement costs at $50.3 million, State Water Contract costs (buying water from Northern California as per its agreement) at $20.7 million and credit payments totaling $24.7 million.

On the other side of the ledger, revenues expected to cover the above costs are listed in the amended budget as totaling $69.1 million.

Included in the amount of money flowing into the agency are: $21 million in property tax revenues, $13.9 in Agency-set property tax revenues, $7.2 million in Facility Capacity Fees, $11.2 million in water sold to Santa Clarita's four water retailers, $6.9 million from money invested by the agency and $9.2 million from such things as being reimbursed for completed capital projects.


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