The board of the El Dorado Irrigation District, in the midst of huge increases in water and wastewater rates, is expected to consider raising salaries today for two of its top executives.
General Manager James M. Abercrombie's $165,000 pay would increase 5 percent under the plan, boosting his annual salary to $173,250, effective immediately. Another 1 percent cost-of-living raise on Jan. 1 would boost it again to $174,983.
General Counsel Thomas Cumpston's $160,360 salary would rise to $166,504, a 3.8 percent increase. It would increase again under the COLA on Jan. 1 to $168,169.
The prospect of salary hikes during a period of hefty rate increases is a sensitive topic for the district, which serves 40,000 water and 20,000 wastewater customers.
Water rates are in the process of doubling from 2010 to early 2015. Sewer rates are headed 70 percent higher over the same six-year period.
The changes in Abercrombie's employment contract are aimed at providing him the same 5 percent maximum wage hike available to most of the district's 220 employees Nov. 1. Workers received no wage increase in 2011.
Still, a handful of district customers told The Bee that it isn't necessarily the salary hikes that nettle. It's the timing.
What also stings, they say, are car allowances for key executives and other benefits paired with soaring water and wastewater rates.
"I'm not against anybody being paid a fair wage," said ratepayer Robert Luca, who last spring testified in opposition to the April rate hike. "But for the public sector to get raises in our environment, with the unemployment rate, it's just not right."
The district's personnel budget "is just not in tune with what's happening in our economy," Luca said in an interview. "I think they are ignoring where our economy is. They are taking advantage of the ratepayers because they can."
Ratepayer Rollin Klink questioned the district's compensation and benefits in light of the high rates. When he examined his water bill recently, he said, he found "a huge jump" just this year.
That's not surprising. The district raised water rates 5 percent in January and another 6 percent in April.
And more is on the way. On Jan. 1, water rates are set to rise another 11 percent. Wastewater rates, already boosted twice this year, will rise another 5 percent next month.
Doug Wiele, the president of the real estate development firm Foothill Partners, said the wastewater rates for restaurants are punitive.
"Whether I have a steak dinner at home or in a restaurant, the discharge going down the sewer line is the same," he said. He called the comparable disparity in rate structures for restaurants and residences "abusive."
Greg Prada, the district's most visible critic, tracks the district's actions and has a wide email following. He predicted that "the solution is going to be a change of board members."
"There are going to be two board seats up in November, so that's going to be an important election," Prada said.
Board members say the forces shaping rates and other decisions in recent years had their roots in better times. Those were the days when the decisions about repairing or replacing aging systems and about raising rates were put off.
"For years and years, the infrastructure was neglected," said George Osborne, vice president of the EID board. "All of a sudden things started blowing up on us. One piece of pipe took $20 million to fix."
Sewer systems 50 or even 70 years old had to be fixed, he said.
By the time the bills came due for the bonds that would finance the work, the economy was in a slide.
"The reason the rates are what they are is that we have about $300 million in (bonded) debt," Osborne said. "About $140 million of that is unfunded mandates by predominantly the federal and state governments. Every utility is impacted by this to one degree or another. It never stops."
The economic downturn, and the accompanying decline in the volume of hookups for new construction, forced the EID and other utility districts to look for ways to cut costs.
In recent years, EID cut its workforce by about 30 percent. It adopted a two-tier retirement plan, with lower benefits taking effect for workers hired after Jan. 1, 2010.
Still, district officials say, the industry demand for certified workers requires competitive compensation.
Bill George, district president, noted that Abercrombie received no salary increase after his hiring in September 2009. Cumpston's last increase came five years ago.
"We're trying to do the best we can for our ratepayers and our employees," George said. "If you don't have happy employees, you're not going to have happy customers, either."
IF YOU WANT TO GO
The El Dorado Irrigation District board of directors is scheduled to consider pay raises for the utility's general manager and general counsel.
When: 9 a.m. today
Where: El Dorado Hills Irrigation District headquarters, 2890 Mosquito Road, Placerville.