During the regular board meeting on Tuesday, the Truckee-Carson Irrigation District Board of Directors voted to approve Resolution 2023-01, relating to an increase in user assessments. The resolution provides for the fixing of a rate of assessment and levy on lands of the district to meet the contractual obligations to the United States and other rising expenses of the district.
During the January meeting, General Manager Ben Shawcroft presented a financial outlook of the ongoing projects facing the district in the course of its general operation, in addition to the payments for the Extraordinary Repairs to the Truckee Canal that have been required by the Bureau of Reclamation.
The $35 million repair project on the canal has begun and is expected to run through the year. To complete the lining of the canal through the Fernley Reach, the canal has been shut down and will not run water during the 2023 water season.
Shawcroft said the anticipated interest to service the debt for that project is estimated to be 1.875% with an annual payment of roughly $1,084,746. The district is also required to pay for the Environmental Impact Statement for the project, bringing the BOR payment to nearly $1.4 million annually until 2029.
In addition to the Truckee Canal repair project, the district is facing work on the penstock in the Lahontan Dam for $1.5 million, repairs to the tower gates at Lahontan for $3 million, management services for the TCID Works program of $130,000 a year, maintenance to the V-Line Weir for $2 million, potential work on the Truckee Tunnel for $3 million, and an increase in the Public Employees Retirement System of up to a 20% to meet the health insurance policy increase, as well as an increase of $39,000 in the Federal Water Master Contribution.
Shawcroft presented two alternatives for lands equal to or greater than 6.68 acres: 1) A one-time increase to the assessment from $47.90 per acre to $50.90 per acre to go into effect July 1, 2023, or 2) Following the $3 increase, an additional $3 increase to go into effect automatically in July 2024 and in July 2025.
For lands with less than 6.68 acres, the options would be 1) a one-time increase to the assessment from $320 to $340 (with no change to the $120 administrative fee) to go into effect July 1, 2023, and 2) following the $20 increase, an additional $20 increase would go into effect automatically in July 2024 and again in 2025.
The board approved the one-time increase to take effect July 1 of this year. Board member Davy Stix opposed the motion, saying the increase may be premature as the District Court judge has not yet certified the election regarding the repayment contract with the BOR. He said he’s never seen the court take this long to certify an election.
Board member Lester deBraga clarified that the court by law doesn’t have to ratify the contract, “we’re just going through the procedure.”
David Rigdon is the Special City Attorney for Water Resources for the City of Fernley who spoke in opposition to the resolution, saying the city is, “adamantly opposed to either option.” He said it is just as presumptuous to presume the judge will ratify as it is that he won’t, but the issue is the assessment. “You don’t have the authority to impose taxes, you are only authorized to impose assessments. In the law, an assessment is a completely different thing than a tax. Assessments require a showing that the property that is being assessed actually receives a benefit. You’re saying, ‘Of course Fernley benefits, we’re fixing your flooding for you.’ Fixing a flooding problem that affected 500 people by imposing literally tens of millions of dollars of cost on the city to help extend infrastructure is not a benefit to the city. There are other less intrusive ways to fix this and the city should not be charged for that.”
The City of Fernley owns water rights in the Truckee Division of the Newlands Project and would be charged the assessment.
“Cutting off our water for an entire year is not a benefit to the city, and there is no analysis to support your decision.”
Shawcroft responded that an in-depth analysis had been presented at the January board meeting and the assessment was to cover not just the repayment contract, but other needs of the district as well. He also questioned Rigdon’s refusal to see a benefit, saying, “‘No benefit to Fernley’ has me scratching my head and I’m not sure their citizens would agree the city has no duty to protect them.”
The board also approved the Rate and Levy of the Annual Assessment on all lands in the district, known as the District General, to be used for deposit in the capital improvement fund. The rate is adjusted on July 1 of each year through a formula based on the Consumer Price Index and was increased from $6.29 in 2022 to $6.56 for Fiscal Year 2023/24.
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