Amador County – The Amador Water Agency board of directors in late January discussed the budget deficit of La Mel Heights Improvement District and directed staff to do further study, hearing that La Mel Heights subdivision has “two wells that serve 59 customers and has been operating at a loss.”

AWA General Manager Gene Mancebo said in 2007 the AWA “built a new well and tank and improved the La Mel Heights distribution system,” said. “AWA obtained a $350,000 Rural Utility Services grant” through the USDA, “and made a loan to the district for the improvements, but debt service and the community’s small customer base have contributed to an annual budget deficit of about $33,000.”

In 2009, rate increases were proposed, and were protested by most customers. “Since then, AWA staff has held meetings and responded to a lengthy list of questions from La Mel Heights property owners,” Mancebo said.

Options for board consideration ranged from consolidation with the Amador Water System to minimal rate increases, “but with drastic operational cuts.” They also considered “abandonment of the system by AWA.”

Jackie Vaughn, a La Mel Heights resident, told the Board that “people are waiting for the Agency to come up with a solution.” She said: “Give us some documentation, present it to the homeowners, and get a decision from them as soon as possible. Time is of the essence, interest costs are mounting, and if something breaks down, what are we going to do?”

AWA Financial Services Manager Michael Lee told the Board that AWA could absorb the La Mel Heights budget deficit, which represents less than one percent of the Amador Water System budget.

The AWA board directed staff attorney Steve Kronick to research “legal questions surrounding the consolidation option.” Staff was also directed to prepare financial plans for different scenarios, including a minimal rate increase to get the La Mel system out of the red with no reserves, the minimum increase to run in the black and build up a small reserve, and options for consolidation. A meeting in La Mel Heights will be scheduled to present the information to property owners as soon as possible.

Story by Jim Reece This email address is being protected from spambots. You need JavaScript enabled to view it.