EDITORIALS
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Here are the answers to the SCA79 questions (see questions below) that I sent to the county. Randy Booker from Sanitation also told me that the proposed increase is now $1.64 per month not the $3.55 per month that was presented to the community.

Answers to questions   Support for answer 7

Questions about CSA79’s Proposed budget for 2008/2009
Compiled by Margaret Johnson
The meeting on April 26th at Green Valley Lake to discuss CSA 79 sewer rate increases raised many more questions than were answered.  I have compiled the following questions based on the presentation.  These questions need to be answered in order to determine that everyone is being fairly charged and that funds are being used effectively and efficiently.  Until these questions are answered, I do not think that the Board of Supervisors should adopt the resolution to increase the monthly EDU rate for CSA79.
Questions

•  What is the definition of an Equivalent Dwelling Unit (EDU)?
• The number of EDU’s cited in the presentation was 1285?  The last census showed that there were 851 homes in Green Valley Lake.  Please explain the composition of the number 1285.
• According to the chart of page 12 current services are estimated at $896,074.  This number is arrived at by multiplying the fy08/09 monthly charge of $58.09 times 12 times 1285 plus a roundoff error $328.   If this calculation is correct then no new connections are budgeted for 08/09.  Does this mean that fire victims will not be charged a connection fee if they rebuild?    Does this also apply to anyone who buys a burned out lot and builds on that site?  If this is the case, a waiver of the connection fee should be made in writing and sent to each owner of a property that was burned out.  It is my understanding that connection fees were to be waived for 24 months.  Due to lot clearing, insurance discussions, the permit process, etc.  some people may not be able to build with 24 months.  What then?
• It is my understanding that CSA79 includes Green Valley Lake, and the three camps accessible from GVL road in its coverage.  Is this assumption correct?  Is there anything else covered?  I understand that Snow Valley feeds into our system and that the flow is metered.  What percentage of flow is attributed to Snow Valley and what percentage of overall expenses does Snow Valley pay?
• Back to EDU’s.  If the number 1285 is correct and the number of homes of 851 is correct then the remaining EDU’s are apportioned to the areas other than Green Valley Lake.  How is this number of 434 apportioned to the other locations?
• Are EDU’s based in any way on the amount of sewage flow into the system?  If so how is this determined?
• Regarding Funding uses shown on Page 13:  It seems that operations consist of water/san op and support, administration and service/supply totals $880,796.  The only breakdown of funding uses was on the handout which totals $344,800.  Please provide a detailed breakdown of the $535,996 difference.  Please also proved a detailed breakdown of each category listed in funding uses.
• Regarding the charts on pages 12 and 13.  The totals don’t add up.  The sum of the parts of funding sources totals $1,506,968 not $ 1,506,986.  The sum of the parts of funding uses totals $1,509,616 not $1,506,986.  While the first discrepancy appears to be a transposition of the last two digits, the second discrepancy of $2,630 doesn’t make any sense.    What are the correct figures?  With nothing balancing, it is impossible to tell if the figures are only off due to rounding errors or are grossly incorrect. 
• Page 13 shows that $136,704 goes to reserves and page 12 shows that $186,780 come from reserves.  Is the difference of $50,076 used to increase the reserves?  If so what is the target amount of the two reserves?  The presentation talks about 3 months of operating fund budget but we do not know what the operating budget is.    The presentation states that there should be an acceptable level of capital replacement reserve.  What is that acceptable level and how is that computed?    The budget handout shows that contingencies of $10,000 and $3500 are included.  How does this relate to reserves?
• How does Arrowbear fit into the equation?  There was discussion of a percentage split of the flow cost between GLV and Arrowbear but it did not make any sense.  Please provide a complete breakdown of what in included in this relationship both in dollars and the length of the agreement.
• How is the $220,000 expense to Running Springs computed?
• The notice to property owners states that the sewer rate is based on “industry factors that reflect the cost for collection, treatment and disposal of the wastewater generated by each customer” Since there is no individual customer metering, how can this statement be correct?
• On the Funding uses pie chart there is $99,420 for other non-operating.  What is that?

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  ASSESSMENT INCREASE PROTEST LETTER
  Property owners in Green Valley Lake have all received a notice that our sewer rates will be going up.  Rates went up 7% last year, and at that time, we were informed that the rates would go up another 7% this year and next year.  While 7% a year pales in comparison to the 100% water assessment increase, it is still higher than the cost of living.  We have the opportunity to stop it this year.  Per the notice, “Customers may respond to the proposed rate increases prior to the public hearing by filing a written protest.  A valid protest must contain a description of the property (address or Assessors Parcel Number) sufficient to identify the property, the signature of the property owner of record, or written evidence that the signer is the owner, if he or she is not named on the last tax roll.”   The notice states, "If a majority of affected property owners file written protests, the proposed rate changes will not be put into effect."   Attached to this editorial is a form letter you may download, print, fill in, and send to the county.  Complete one for each parcel of property you own.  These protest letters need to be received by the county prior to the meeting on June 26.  If you disagree with the proposed rate increase, I urge you to send your protest letters now.  Download Letter
  B. Harris
  Green Valley Lake

Randy Rozatti running for GVL Water Board Member Position
March 30, 2008

Property Owners in Green Valley Lake, California:

My name is Randy Rozatti and it is my intention to be a candidate for a position on the board of directors of Green Valley Mutual Water Company, hereafter referred to as “the company”.

I am recently retired as Director of Information Technology for Calavo Growers, Inc. based in Santa Paula, California.  During my thirty (30) years with Calavo, I was responsible for the administration, implementation and maintenance of computer networking, hardware and software for the entire organization.  I managed a department with a two million dollar operating budget. I spent several years as a member of senior staff, reporting to the president of the company, and as a participant in monthly board meetings.

My wife and I founded the GVL Disaster Recovery Foundation, Inc. and I’m a member of its board of directors.  The foundation is a non-profit, charitable organization working within the Green Valley Lake community to assist fire victims.

I am also a member of the Green Valley Lake CDP.

My wife and I have been residents of GVL since 2003.  We were weekenders for the first three years and have lived here full-time since August, 2006.

There are many things that concern me, but let me mention just a few.  I know other of you have different concerns and this certainly not an exhaustive list.

I’m sure you have all received your annual statement, assessment and brochure containing the president’s report and other information. 

First, if you look at the last paragraph of the annual report you will notice that the management of the company “has elected to omit substantially all of the disclosures required by generally accepted accounting principles”.  They are telling us that, if we know the facts, we might question the condition of the company.  They conclude by telling us we’re not sufficiently “informed” to have this information anyway.

Second, the president of the company tells us in his report that the loss of 10% of homes in GVL makes it necessary to raise the annual assessment and monthly water rates.  He mentions that some owners are choosing not to rebuild.  There are organizations in town that have been working to assist those who have lost their homes to rebuild.  However, any attempt by those organizations to reach affected owners through the monthly mailing has been rejected.

Third, there is a line on the annual report under SURPLUS titled “Unappropriated” with a balance of $1,614,083.  This is over and above normal contingencies.  My immediate conclusion was that the money was set aside for litigation pending for lake cleanup, but a disclaimer on the annual report states that nothing relating to the lawsuit is included in the report.  In light of the assessment and rate increases, some accounting for this “unappropriated” amount seems in order.

Fourth, and certainly not last, several residents have attempted to secure copies of the company’s by-laws.  We have been told these are available for viewing only, cannot leave the office and cannot be copied. 

I am not asserting that management is acting against our best interests, but their management style makes it impossible to make the determination. 

As stock holders of the company and consumers of its services, I think we deserve better.

It is important that every concerned shareholder attends the May 13 meeting to insure that his shares are cast as he intends.  If you are unable to attend, I would be honored to act as your proxy, but at least appoint someone to vote your shares.

Sincerely,

Randy Rozatti

ADDENDUM

April 15, 2008

Several questions have come up regarding my comments above since this letter was written.  I have decided to address these issues in this addendum.

Re: Paragraph beginning “First…”

I was asked if I was implying that the company is doing something wrong. 

My intent wasn’t to accuse the company of any wrongdoing; it was to say that I think we are entitled to more information.

The annual report is a “compilation” report.  It is the lowest level of CPA reporting.  As I understand it, a “compilation” means that the CPA used the company’s financial statements to prepare the annual report, but he did no in depth analysis of the statements.

The verbiage contained in the CPA comments is, for the most part, standard verbiage for a “compilation” report.

I have since found out that an “audit” was done by an independent auditing firm, but was not included or referenced in the annual report.

Re: Paragraph beginning “Third…”

I understand that the “surplus” accounts for non-profits are analogous to “retained earnings” accounts for for-profit corporations.

The purpose of the “unappropriated” account and what it means to GVL owners is still not adequately explained and will be a topic of conversation at the May 13th meeting.

I understand that the company is currently in conversation with the possible litigants in the “lake cleanup” issue.  It appears that some agreement has been or will be reached which will reduce the cleanup cost to the company.  The actual cost is still undetermined.

Re: Paragraph beginning “Fourth…”

I have been told that the company will allow anyone to hand copy or scan the referenced documents as long as company staff isn’t involved in the copying or scanning.

I want to thank Rick Mull for the additional information he’s made available on RimOfTheWorld.net.

If you’ve been following the site you may have seen numerous postings from GVL Water explaining several issues in great detail. 

This is the kind of openness I, as a member of the board, hope make a regular part of company activities.

Regards,

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