Groundwater Authority rejects budget

By BRIAN COSNER

News Review Staff Writer

The Indian Wells Valley Groundwater Authority rejected a proposed 2019 budget earlier this month and asked staff to present a more detailed budget next month.

The budget included roughly $3 million in expenditures for 2019 – $1.3 million for Groundwater Sustainability Plan preparation, $422,900 for a water audit, $221,138 in reserve funds, $210,466 for a reimbursement to the city and $200,000 for special legal counsel.

Revenues included roughly $2 million in Proposition 1 grant funding, $40,000 from a stressed counties grant, a $237,460 advance from Kern County and $738,339 from the groundwater pumping fee.

Alan Christensen from the Kern County Administrative Office presented the budget because the county has retained some of the Authority’s administrative functions in lieu of a standing general manager.

But several boardmembers were concerned that the presentation

didn’t match the information they had in their packets. They also said there weren’t enough detailed line items to compare the budget to last year’s.

IWVGA Chair Ron Kicinski, representative from the Water District, pointed out that the cashflow didn’t match the budget —“Shouldn’t there be a correlation?” he asked.

“Also the pumping fees are different and I don’t see the Kern County advance in the revenue portion of 2018 cashflow.”

“I’m not sure why we picked up a different number for the pump fee revenue than what is on the cashflow,” said Christensen. “I’d have to go research why that is the case.”

He added that the one-time cash infusion from the county was not a line item in the revenue but incorporated into the net revenue in the financial report.

“I also notice the reserve went up from the original $30,000,” said Kicinski. “My point about this whole process is – this is difficult at best to understand. These don’t appear to me to be standard practices that you would normally see in budgets, expenditures and cashflows.”

Kicinski said he wanted a budget he could compare to the expected and actual revenues and expenditures of the previous year.“I know it’s difficult, but I don’t want surprises and I feel like we have some expenses coming forward.”

He suggested that water district staff become more involved in the financial reporting process.

“We need to have a good understanding of what we’re paying for and why,” said Inyo County Representative John Vallejo. “At this point I’m very concerned with trueing up this proposed budget with our proposed cashflow. What is the County of Kern advance? Is it a loan from our treasurer? Is it somewhere reimbursable in the expenditures? Because I don’t see it.”

Vallejo added that he’d like to see a budget that differentiated between required expenditures and preferred expenditures.

“Are any of these expenditure lines things that we should do verses things that we have to do?” he said. “I don’t see any policy recommendations in here coming from staff to this board to make a decision on this budget. I just see a spreadsheet.

“We need to know what’s absolutely necessary and what our goals are. It’s important to know which of these line items are necessary to get to that goal and which are not.”

“I share the concerns of my peers,” said San Bernardino County representative Luther Snoke, who teleconferenced in. Snoke only had access to the paper presentation which did not match what Christensen presented on the screen.

“There’s no history, there’s nothing comparative,” Snoke continued. “Even the categories seem to be arbitrary rather than standard categories.”

Christensen said that without a fee in place for most of 2018, and with the 2019 workload being much larger, it was difficult to make a comparative budget.

“No it’s not a standard practice, but that’s because we rotate general managers every year,” said Christensen. “We’re parsing out responsibilities. You don’t always have the same people working on the same things. That is the reason we recommended a full-time general manager.

“If you want more information, we can do our best to provide it. However, there are limits to the amount of time we can dedicate to that function.”

“For two-and-a-half years the public has been requesting a finance committee,” said Sam Merk during public comment. “So far to date, we don’t have one. Please consider that going forward.”

“I understand there’s a lot of hard work here,” said Joshua Nugent of Mojave Pistachio and Nugent Farms. “I just feel that with $3 million, there should be some greater form of accountability than a one-page Excel spreadsheet.”

He added that many Groundwater Sustainability Agencies managing larger, more populous basins have budgets of under $2 million.

Derek Hoffman, legal counsel for Meadowbrook Dairy, also spoke up during public comment.

“Meadowbrook is one of the large pumpers that is funding this work. We’re talking about other peoples’ money and I think it’s important to remember that,” he said.

“This is one of the highest [groundwater pumping] fees in the state, if not the highest. We’re anxious to know if the money is being budgeted carefully. I would say bluntly today, you really should not approve this budget as it’s presented to you.”

The Authority board reached a consensus and directed staff to bring back an updated budget next month. For a meeting schedule and more on the Authority, visit iwvga.org.

Story First Published: 2019-03-08