The El Dorado irrigation district wants to raise water rates 80% over the next five years, an extra $600 a year for the average household.
That’s a lot of money for struggling families, but what makes it worse is why the district needs more money - in part, to pay for richer retirement benefits.
In 2004, the district board approved a 35% benefit increase. Under the old formula, an employee who worked 30 years and earned, say, $100,000 a year, would get an annual pension of $60,000. Not bad. Under the new formula, that same employee’s pension would be $81,000, more than a third higher.
Not surprisingly, the district’s retirement bill skyrocketed - going from just two thirds of a million dollars in 2004, to more than $3 million dollars last year, one reason they need to raise more money.
But the rate hike is not a done deal. If a majority of customers protest, the board can’t impose higher rates. Before any increase is finalized, the board ought to rescind the new pension benefits, at least for new hires. Neither the district, nor its customers, can afford it.
Ginger Rutland writes for The Sacramento Bee opinion pages.