In a nod to public pressure, the Oceano services district board has voted down a plan to sell some of the community’s water to a developer.
“I’m in favor of selling,” board President Jim Hill said. “But we’re supposed to be representative of what the community wants to do.”
The board’s move Wednesday now calls into question what might happen to other similar proposals to sell water, and how the district will pay for needed upgrades to antiquated water mains and other infrastructure.
The vote comes about three months after the district board first discussed selling some of its surplus water, which prompted vociferous opposition from residents who argued that doing so would put Oceano’s future at risk.
Despite the vote, many on the board are worried about how they’ll pay for the water system’s upkeep.
“Wells are falling apart with ancient pumps; we have steel water mains (installed) in 1952, and they’re rotting away in the street,” Hill said.
Hill, along with board members Mary Lucey and Matthew Guerrero, voted against an agreement to sell 100 acre-feet of water to developer Larry Persons of the Los Robles del Mar project just outside Pismo Beach.
Board members Carole Henson and Lori Angello voted in favor of selling the water, for which Persons offered to pay more than $2 million, which includes a one-time contribution of $500,000 and a total of $1.5 million in connection fees for the homes he intended to build.
The board faced unanimous opposition to the proposal from the several dozen people gathered at Wednesday’s meeting, who applauded when the board voted against the plan.
Lucey, who was strongly against the proposal, argued that a sale of water was going against Oceano residents’ wishes and would be selling the community’s assets for “chump change.”
Five Oceano residents in recent weeks gathered enough valid signatures on a petition that would require the community’s registered voters to approve any permanent sale of water to an outside entity. The district board will consider adopting the ordinance put forward by the petition at its next meeting Feb. 23.
But the move may now put the district in a tough spot: The proposed water and sewer rate increases, which will also be heard at the board’s next meeting, are only enough to cover operational costs and slowly pay back the district’s depleted reserve accounts. According to Hill, about $1 million to $1.5 million worth of capital improvements are needed. If the district’s roughly 2,100 customers had to cover the cost evenly, it could cost each of them about $100 in addition to their bimonthly bills.
“But who is going to want to pay that?” Hill asked. “I don’t know if that’s practical.”
Henson said she voted in favor of the proposal to avoid steeper rate increases and “help Oceano get out of the hole.”
Oceano district staff had been working for several months on a proposal to permanently sell 100 acre-feet of water to Persons, who recently upped his offer for the water by $1.5 million to more than $2 million.
The Los Robles del Mar development includes 252 single-family homes and 60 senior citizen residences on 182 acres bordered by Oak Park Boulevard.
In 2008, the San Luis Obispo Local Agency Formation Commission, which has to approve annexations of city land, denied Pismo Beach the Los Robles del Mar annexation because there wasn’t enough water to meet the needs of the proposed development.
It’s unknown how the board’s action might affect two other proposals that had been floated: to sell some water to Arroyo Grande and to developer John King for a development in Price Canyon. Arroyo Grande City Manager Steve Adams said he’d wait to hear from Oceano before the city submitted a proposal.