James Belna (COURIER, August 22) offers a series of inaccurate assumptions about Claremont buying its local water service. Let’s look at a few:
First, he equates the process of acquiring the water works to coin-flipping and rules it out as based on impossible odds. Not so! This is no flip game. It has had meticulous analysis from water and financial experts for two years and is being pursued with legal “due diligence” at every step.
Second, the city will file a “Resolution of Necessity” in the Superior Court stating that acquiring the water system is for the public benefit of citizens. They need not prove city ownership is necessary. This ruling comes from a judge, and is almost never denied. (Recent example: Felton, California.)
Third, Mr. Belna does not recognize that Claremont’s evaluation of $55 mil- lion for the water company was made by a state-approved appraiser, using the principle of anticipated income (of the three possible bases clearly the most reliable).
Golden State has not yet, so far as we know, commissioned an appraisal. When they do, they must use a state-certified appraiser who must state the basis of his calculations, and must disclose details about the state and condition of the technical equipment.
Until this appraisal is made, any figures of value are merely guesswork. Mr. Belna guesses $200 million; it has no basis in fact and is not a part of the legal process.
Fourth, he seems to be confusing revenue bonds with general obligation bonds. Revenue bonds are sought after by investors because repayment is assured by proven income from water rates and is paid, not from taxes, but by a “capital charge” on water users, based on residents’ actual use—a charge fair to all.
Fifth, Measure W asks for “up to” $135 million, but remember that the first $80 million is already being paid by Clare- mont ratepayers for million-dollar executive salaries, reliably high dividends to distant stockholders, taxes, PUC charges and WRAM and intervenor fees—and goodness knows whatever new fees are added to your next bill!—costs we will not owe if GSW is out of the picture.
Truth is, we cannot afford not to own our water system. Although the precise price is not yet known, neither are the fu- ture prices under GSW. They have be- come a luxury most of us can’t afford.
For the long run, we’ll have local information and local control of this necessary public benefit. Buy it!
It is the right thing to do!