By Miki Mullor

Forced to roll back water connection fees, the Town of Hideout is now proposing water usage increases by up to 54%. Mayor Phil Rubin blamed the rate hike on an increase in the cost of water charged by the Town’s wholesale supplier, Jordanelle Special Service District (“JSSD”).

JSSD has denied it raised rates on Hideout. Documents obtained through a GRAMA request from JSSD show no rate increase in the last two years.

Hideout’s budget proposal for FY24 shows that water costs are in fact expected to be lower than the four year average and lower than FY21 and FY22. Salaries and benefits cost on the other hand is set to increase by 42% compared to last year, and by 226% compared to FY21.

This might be the second time Rubin is relying on misrepresentation to the council to raise public fees. After we published our story on the use of fabricated data to justify gouging water meter fees, the council voted to roll back those fees and issue refunds to impacted residents.

Water rate hike by up to 54%

During the June 8, 2023 council meeting Rubin proposed an increase to the water rate, which would have raised the cost per 10,000 gallons used per month to $149.10, a 54% increase compared to the current rates. To promote conservation, Rubin also proposed new usage tiers of 6,000 and 8,000 gallons, after sharing usage data that shows a large number of residents only use about 6,000 gallons per month.

The council has not yet voted on the water rate increase, while it did vote to roll back water meter fees and increase other rates. Council members could not agree on the new structure and asked for more data.

JSSD refutes wholesale rates were raised

On the July 13 council meeting, Rubin pushed the council to go along and pass the increase:

“we do need to raise the base rate for under the target of 10,000, because, JSSD has raised their rates. If there are questions about JSSD raising their rates, you can go to the JSSD website. That data is available, it’s published… You can research and see that they have in fact, raised their wholesale rates to their wholesale which includes the town of Hideout.” – Rubin told the council.

Max Covey, General Manager of JSSD, denied wholesale rates were raised: “no increase from 2022-2024. We will complete a study in 2024 to see if any adjustment will need to be made.”

JSSD’s response to our GRAMA request included the following board resolution from 2019, indeed showing rates were not raised since 2021, and before that, only modestly per acre-foot in the take-or-pay contract:

(an acre-foot is roughly 326,000 gallons)

Rubin confused on public data, or is he?

Later during the July 13 meeting Rubin doubled down on his claim that JSSD raised the rates on Hideout and that requires a rate increase on residents:

“The rate increase that we received from JSSD, that data is well understood, published and available. We should issue that immediately. Come straight from their website… As a minimum, that’s what’s gonna happen to each and every water user in Hideout, because we’re paying more for JSSD water and we have to pass that through”.

Rubin did not respond to a request for the published rates he referred to. The Town did not respond to a GRAMA request asking for documents of any rate increase notices from JSSD.

Rubin might be trying to point to a study establishing new rates JSSD charges non-governmental users by volume. The January 2023 study explained: “existing rates are based on meter size and consist of a base rate with a volumetric allowance and a volumetric overage rate for users who exceed the 10,000 gallon allowance.”

Volume rates that JSSD charges their customers cannot be confused with the wholesale contract rates JSSD charges Hideout, which the 2014 agreement states clearly is “the price currently is $750 per acre foot per year for public governmental customers such as Hideout…. This agreement to provide wholesale culinary water is a “take-or-pay” agreement, meaning that Hideout shall pay the established annual acre foot charge regardless of whether the water is actually used”. (an acre-feet is equivalent to 326,000 gallons).

JSSD rates omitted from comparative data

Rubin himself clearly understood the difference between volumetric charges and a flat charge. During the June 30, 2023 council meeting he told the council that “we’re paying for 50 acre feet or whatever the number is, whether the town uses 50 acre feet or not.” (the actual number is 150 acre foot).  

This was in response to a probe by council member Chris Baier who was trying to understand what was the JSSD rate increase per gallon of use. Rubin evaded answering the question, saying: “ I don’t have the answer specifically tied to gallons because we’re paying for whatever the volume is…whether people use it or not”.

Interestingly, staff did not include that same JSSD’s rate study in comparative data from other water districts presented to the council.  That study shows that JSSD, the water supplier of Hideout, charges their retail customers $115.45 for 18,000 gallons,  or $6.41 per 1000 gallons, compared to Hideout’s proposed $149.10 per 10,000 gallons, or $14.90 per 1000 gallons – a whopping 132% higher rate than JSSD.

Salaries, not water, increase – by 42%

The Town’s own budget also contradicts Rubin’s claim a water cost increase necessitates a water rate increase on Hideout residents. The FY24 budget shows water cost to be under the four year average of $276,527 and less than what the Town paid in FY21 and FY22.

However, the FY24 budget includes a 42% increase in salaries and benefits, to a total of $649,708, representing 35% of total expenses for the water operations (up from 22% in FY21).

In fact, water cost has slipped to only 15% of the total water operations expenses (down from 32% in FY21). The budget does not give details of the headcount and the functions these salaries pay for, therefore there is no way to tell from the public documents whether these are true water operations expenses or whether the Town is loading general admin expenses on the water operations or for some other purpose:

	FY21	FY22	FY23	FY24 (budget)
Salaries	$185,154	$304,595	$359,314	$431,822
Benefits	$13,718	$93,469	$96,121	$217,887
Salaries + benefits (total comp)	$198,872	$398,064	$455,435	$649,709
JSSD water cost	$290,110	$309,904	$230,976	$275,116
Total water fund expenses	$906,208	$1,485,839	$1,282,664	$1,881,427
% admin / total expenses	21.95%	26.79%	35.51%	34.53%
% water / total expenses	32.01%	20.86%	18.01%	14.62%
YoY total comp increase		100.16%	14.41%	42.66%

Public hearing scheduled for August 10

A public hearing, required by law, is planned for August 10, at which time the public may address the council on the water rate increase. Council member Ralph Severini has asked for the data to be made available sooner.  Indeed, Hideout normally publishes discussion materials for public view just one day before council meetings, leaving very little time for the public and council members to digest or do an independent research

UPDATE July 17:

We asked JSSD to comment on Rubin’s statements during the July 13 meeting.

Max Covey, JSSD General Manager, stated by email:

“JSSD had an increase to our retail customers in July. This study and increase did not effect the JSSD wholesale rates. There may be some confusion here. I was just informed earlier this year someone from Hideout may have reached out to inquire what are rates were expected to do. JSSD’s budget runs on the calendar year and we were in the middle of completing our study and didn’t have solid information yet other than our retail was expected to go up 5-8%.

Wholesale rates are on our website now. We only have 2 wholesale customers. Hideout and NVSSD.”

Indeed, JSSD’s website has been update to include its wholesale rates:

References:

• JSSD Hideout wholesale agreement
• JSSD board resolution 2019-06
• JSSD 2023 rate study
• June 8, 2023 council meeting packet
• June 8 FY24 budget
• June 30 FY24 budget