SFID and RSFA Settle 2016 Rates Litigation

By Phil Trubey

June 25, 2021

Editor’s Note: Below is today’s press release announcing the water rates litigation settlement. Whether this is good news or bad news for large water usage RSF residents depends on whether SFID’s new Cost Of Service Study proposed below will either equitably distribute costs among all ratepayers, or, as is done currently, arbitrarily stick large water users with outsized responsibility for peak usage and other costs (like pensions). Click here to dig into the numbers as to why large water users pay a lot more per unit of water than small users. How much more? See this article for that analysis.

The Association has reserved the right to launch another lawsuit protesting more recent rates if the new resulting Cost Of Service Study remains inequitable.

Teresa Penunuri
Santa Fe Irrigation District
C: 858-472-0211

Christy Whalen
Rancho Santa Fe Association
P: 858-756-1174

June 24, 2021 – Santa Fe Irrigation District (SFID) and the Rancho Santa Fe Association (RSF Association), Greg Gruzdowich and Howell Wynne, have reached an agreement settling litigation initiated in December 2018 over SFID’s 2016 water rates.

At its meeting on June 17, 2021, the SFID Board of Directors unanimously approved a settlement resolving the litigation. The settlement agreement was approved by the RSF Association, Greg Gruzdowich and Howell Wynne earlier this month.

Under the settlement agreement, the RSF Association, Greg Gruzdowich and Howell Wynne agree to dismiss the litigation regarding SFID’s 2016 water rates, and SFID has agreed to hire a rate consultant to prepare a new cost-of-service study to include, as part of the analysis, a budget-based tiered rate structure. While not committing to a specific rate structure, the SFID Board has agreed to consider in good faith, the rate structures proposed by the rate consultant and others, during its rate setting process. The settlement agreement also puts on hold any proceedings related to a claim filed by RSF Association, Greg Gruzdowich and Howell Wynne regarding SFID’s 2020 rates, until SFID has considered and adopted a new rate schedule, or January 31, 2023, whichever is later.

“Communication and collaboration are key tenets of SFID’s vision and values,” said SFID Board President Michael Hogan. “We are very pleased that we were able to resolve this litigation with the Association and look forward to ongoing discussions on the value of water and equitable rates across all customer classes. As our local communities, region and state face long-term issues such as drought, climate change and increased regulatory pressure, collaboration with the entire community is key to maintaining our economy and quality of life. Water supply resiliency sustainability, and affordability are the foundations of our community, and we are dedicated to engaging with our

“Equitable water rates for Rancho Santa Fe and all customers has been the goal of our current litigation efforts. We are pleased to take a collaborative step forward with SFID in this process,” said RSF Association Board President Mike Gallagher. “As residents of a rural community, our members have appropriate and reasonable needs for water. We are hopeful SFID will devise an equitable water rate structure that is fair to all customers, whether they are residential, agricultural, or irrigation class customers at a price that represents the true cost of providing this critical resource.”

SFID will commission the new cost-of-service study called for in the settlement agreement, beginning in Fall 2021. Public meetings and workshops will be held to educate the community on the cost of providing a safe and reliable water supply and future plans for the District. Any changes to the water rate structure will presented to the SFID Board and adopted prior to implementation. SFID Board meetings are open to the public and are currently being held virtually. The District is currently evaluating public safety requirements before holding in-person meetings later this year.

Established in 1923, Santa Fe Irrigation District is a California irrigation districting providing retail water and recycled water service to the communities of Rancho Santa Fe and Fairbanks Ranch and the city of Solana Beach.

The RSF Association, formed to preserve the character of the community, its landscape and architecture, includes nearly 2,000 properties and is roughly 10 square miles. Historic Rancho Santa Fe was established in 1928 as a country residential community with an emphasis on agriculture and the rural landscape.

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