Concerns Raised Over Water Hookup Charges

Developers who build in the eastern portion of the Santa Clarita Valley could pay nearly two-thirds more for water service hookups than their counterparts who build on the west side, giving them an unfair advantage, according to documents released by the Castaic Lake Water Agency.

At a meeting of the water agency’s board of directors Wednesday night, three directors expressed concern over the dramatic differences in what the agency charges developers in different parts of Santa Clarita.

The three directors urged the rest of the board to evaluate what the agency charges builders for the cost of hooking up new homes to the water system.

Westside builders will pay about $4,500 for each new house they build next year, while builders on the east side, in areas such as Canyon Country, will have to pay about $7,400, according to the agency’s Data Document, an annual report.

The agency provides water from the State Water Project to Santa Clarita utility companies. Connection fees pay the costs of digging trenches to lay water pipes and run pumping stations.

“We say that we don’t want to control growth,” Director Randy Pfiester said at Wednesday’s board meeting, “but when builders in one area have to pay more for water than builders from another area, that’s what we’re doing. We should help make all the areas equally attractive to [home buyers].”

The water agency’s general manager, Robert Sagehorn, defended the fairness of the cost structure, saying builders in the eastern area of Santa Clarita pay more because their projects are farther from the agency’s water treatment facilities.

The farther from the treatment plant a home is, the higher the costs for extra pipe and pumping, he said.

“The bottom line is, none of the people paying the bills have complained about our fee structure,” Sagehorn said. “We could try to even the structure but it would mean that builders in the west would end up paying the costs for the east side. Is that fair?”

Wednesday night’s debate over the fee structure was prompted by a mistake found in the Data Document, the calculations for next year’s connection fees.

Director Mike Kotch, an aerospace engineer, caught the mistake two weeks ago and brought it to the attention of the rest of the board. He said the numbers he crunched pointed to a disturbing inequity for the Saugus area.

Kotch said the figures indicated that developers who planned to build in Saugus next year would pick up most of the connection-fee tab for the proposed 25,000-unit Newhall Ranch project. The extra cost, Kotch said, would total about $28 million over a 13-year span.

Sagehorn said the imbalance was due to a misprinted figure in the document. He said the accounting firm and financial consultant the agency hired to create the document never factored the incorrect number into the final calculation for connection fees.

“The incorrect figure played no part in the final numbers,” Sagehorn said. “The final results are completely correct.”

Most of the board members agreed. They voted 7 to 1, with two abstentions, to adopt the Data Document. They decided that no increase in fees was necessary next year. But William C. Cooper, the board’s president, called for a closer examination of the Data Document in the future.