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Local water districts likely to raise rates on innocent customers

Take a hike

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Fountain and Security's increased use of SDS water aids CSU with operational costs. - COURTESY COLORADO SPRINGS UTILITIES
  • Courtesy Colorado Springs Utilities
  • Fountain and Security's increased use of SDS water aids CSU with operational costs.

'It's amazing, really, how it worked out," says Roy Heald.

Heald, general manager of the Security Water and Sanitation District (SWSD), is referring to perhaps the only piece of good news in the ongoing story of water contamination in communities south of Colorado Springs.

"We got into planning [the Southern Delivery System] two decades ago for redundancy, thinking we'd use it if anything happened, and then it comes online not three weeks before we really needed it," he says.

In May, the Environmental Protection Agency issued a health advisory lowering what's considered a safe amount of perfluorinated chemicals — a highly prevalent but unregulated toxin that's been linked to low birth weights, heart disease and cancer. Wells drawing from the Widefield aquifer, which supplies around 80,000 people's drinking water, then tested at nearly 20 times the EPA's recommended threshold in some cases.

Right away, SWSD took mitigating steps by instigating watering restrictions, fast-tracking an infrastructure project to boost connectivity between service areas and negotiating more access to surface water through the newly operational SDS pipeline. By September, all groundwater wells were shut off. But all that came at a price.

"The exact cost is hard to pin down at this point because we've still got bills coming in," Heald says, "but yeah, this was a huge unanticipated expense." To get an idea, consider groundwater typically accounts for half the district's total water supply. Forgoing cheap groundwater in favor of more expensive surface water, even if just for the last four months of the year, cost SWSD around $1 million in 2016, when it expected to spend $100,000. The district has deferred other capital projects, prioritized new ones and diminished its cash reserve, meaning it needs money.

But from whom?

At the very least, the Security, Widefield and Fountain water districts are all expecting some portion of the $4.3 million the Air Force pledged over the summer after Peterson Air Force Base admitted a chemical-laden fire retardant used for decades on base could be the source of contamination.

Air Force spokesman Steve Brady gave the Indy a rundown of how the money's being spent: Homes on private well water will get reverse osmosis systems installed; NORAD and Security Mobile Home Parks will get granular activated carbon systems, as will Stratmoor Hills, Fountain and Widefield public water systems; First United Pentecostal Church will tap into Security water; SWSD will construct new piping to hook into Colorado Springs Utilities; the Fountain Valley Shopping Center, private homes that don't agree to take ownership of a filtration system once installed and the Venetucci farmhouse will continue getting bottled water.

The Air Force's pledge has been messaged as a "good neighbor" gesture and not a signal of responsibility, meaning that for now, available funds are finite. The Air Force Civil Engineer Center is working to confirm or deny the possibility that contaminants came from Peterson Air Force Base while public health officials (and private litigants) continue to investigate other possible polluters.

A damning outcome of those inquiries could warrant additional compensation, but until then, affected parties will have to just deal on their own.

"I know we'll get some share of that $4.3 million, but whatever it is won't be enough to cover our costs," says Heald, whose district hasn't received a check from the Air Force yet. "There could be grants available at the state level, but those are in the thousands or tens of thousands range. We're looking at millions. I've talked to our congressional representatives but I don't know about federal sources. Maybe folks will have other ideas, because whatever the source, our ratepayers didn't cause this so they shouldn't have to pay for it."

Security residents will start seeing higher water bills immediately. Rates were already scheduled to rise in 2017 before this situation arose, but now the hike could be steeper. Unless some new windfall comes through before the next rate study gets underway in the fall, you can guess what direction rates will continue to go. Still, a typical water bill in Security during 2016 was $36 —about half of a typical Colorado Springs bill.

Fountain is in a similar, though not identical, position. "We don't need to use groundwater in the wintertime — that's been the standard for years," Utilities Director Curtis Mitchell tells the Indy, explaining that groundwater only ever flowed through taps during peak demand over the summer. Ahead of that time this year, Mitchell has negotiated extra surface water through a capacity swap with Colorado Springs Utilities. Groundwater will only enter the equation once filtration systems are installed and working reliably.

Widefield has been off well water since November, according to department manager Brandon Bernard, who says four pilot projects are underway to find the best technology for filtering out PFCs. He's aiming to get a small treatment facility built by May and another, bigger one "in the near future." (Because Widefield isn't an SDS partner, it has limited surface water, hence the primary focus is on treating well water.)

"All of the capital costs to pilot and build the treatment will be taken from cash reserves," Bernard wrote by email. "The only costs the customers will incur through rates will be to cover operation and maintenance of these facilities. ... We aren't sure how much of the $4.3 million is portioned for WWSD and have not heard when we will receive it."

Fountain and Security's increased reliance on SDS may cost their customers, but it provides some relief to Colorado Springs — primary investor, owner and operator of the $825 million pipeline. As partners, Fountain and Security already contributed their share of construction costs, but moving more water through it offsets operational costs.

"We're running at really low levels right now, so there's plenty of room in the pipe for our partners," says Colorado Springs Utilities spokesman Steve Berry. "The bottom line is we're one big community here in El Paso County, so we're happy to be flexible for them, but it also takes some of the financial burden [of running SDS] off our customers."

The costs of getting SDS up and running have been factored into CSU's rates over the past five years, Berry says, so Phase 1 is pretty much paid for. Phase 2, including new storage construction and reservoir resurfacing, has yet to be reflected in customers' water bills. Other capital improvement projects like maintaining aging pipes elsewhere in CSU's raw water system, replacing main lines under downtown and modernizing storage tanks and treatment facilities are coming later.

So whatever reprieve Colorado Springs water users get will be overshadowed by other expenses. "Unfortunately, base rates typically don't go down — they either stay constant or they increase," says Berry, who emphasizes that partners' usage won't compromise CSU's access to water. CSU still has precious "first-use" water rights and plenty of redundancy built into its overall system. "But to have a high-quality, reliable water source requires a hefty investment," Berry adds.

Reliable is the key word there, as demonstrated by the crises playing out in Security, Widefield and Fountain, and communities across the country where drinking water is compromised. Part of the trend is having better detection instruments and part is better science showing potential harm, Heald observes. But, he says, what remains constant is America's "leap before you look" approach to regulating toxins in our environment — chemicals get introduced to the market before anyone really knows what risk they pose.

Heald offers this summation: "You don't know what you don't know, but when you do know, you know it's going to cost more."

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