With little fanfare and no public comment, the Oakdale Irrigation District raised the price of water for its 2,900 agricultural customers Tuesday. Later, board members moved to soften the financial impact of higher rates by supporting a proposal to help farmers pay for projects to improve irrigation efficiency.
Effective immediately, OID ag customers will pay a base water rate of $27 per acre, an increase from $19.50. For the first time, the new plan features a tiered pricing structure that combines the base rate with a volumetric rate to reflect how much water farmers use.
Directors Al Bairos, Herman Doornenbal, Frank Clark and Steve Webb voted unanimously to approve the rate increase, which will generate about $500,000 a year in new revenue. It also brings OID into compliance with state requirements to measure how much water is delivered to customers and adopt volumetric pricing. Director Jack Alpers was ill and did not attend.
The new rates will be phased in over two or three years, explained General Manager Steve Knell. He said 2015 will be a transition period. Ag customers will be charged a flat $27 per acre, but their bi-monthly bills also will reflect what they would have paid under the tiered structure based on existing meters or accepted calculations of water use per crop.
In future years, the new structure includes the base rate, plus suggested charges per acre foot. The maximum rates begin at $3.15 for the first three acre feet that rise to $6.25, $8.30, $10.40 and $20.75 at successive levels. The board will determine pricing each November.
The plan has a 3 percent escalator clause, which directors can enact or not each year. There also is a per-acre surcharge of $6.10 per acre when the board declares a drought, as it did earlier this year.
OID’s 650 domestic water users are not affected.
The phased-in approach, Knell explained, anticipates that farmers will invest in ways to improve their water efficiency before the full rate hike takes effect. It also gives OID time to upgrade its metering and measuring capability, which covers about 70 percent of the district today.
“Most districts have gone to this interim step,” he said. “It allows people to change their irrigation patterns and habits.”
Knell also outlined a voluntary plan that could help farmers pay for irrigation improvements on their property – projects such as laser leveling of land, replacing old pipes, or installing drip, micro-valve, sprinkler or tail-water return systems. Called the On-Farm Conservation Funding Program, the concept is for farmers to take parts of their land out of production for one year. OID, in turn, will take the water that would have been applied to those pastures and fields and sell it on the open market. Knell estimated the plan could generate up to 25,000 acre feet of conserved farm water, which would be marketed with any surplus water OID has for sale.
Because of the three-year drought, water prices are at an all-time high in California. Many buyers have paid $500 to $1,000 or more per acre foot. Money from the farm-related conservation sales would be returned to the landowners in the form of cash (20 percent) and credits toward irrigation improvements (75 percent). OID would keep 5 percent.
Knell said the idea especially makes sense for those who own the 29,000 acres of flood-irrigated pasture land, which represents about half of OID’s delivery area.
“A lot of our parcels have 80- to 100-year-old irrigation systems. They’re not very efficient,” said board President Steve Webb. “This will be a win-win for the district and landowners.”
The district will send letters to each ag customer this month and schedule public meetings in an effort to explain the concept, Knell said. Depending on the response, the OID board could vote to implement the program in December. Knell envisions the program lasting four years; no parcel could participate more than once. OID would conduct inspections to ensure no water – from canals, pumps or nearby runoff ditches – is applied to land that is idled.
The OID conservation proposal, he said, is modeled after the Environmental Quality Improvement Program managed by federal National Resources Conservation Service.
“The purpose of the program is drive money into the farm so people can do productive work,” Knell said. “With water rates going up, people need an opportunity to get into compliance, get their land in shape, and to use someone else’s money and not their money to help pay for it.”