VVWD Exercises: Bend Over And Grab Your Ankles

Okay everyone, it's time for our daily Virgin Valley Water District exercise class.

Step one - bend over.

Step two - grab your ankles.

Step three - prepare for some pain.

Step four - do it all over again.

At Tuesday's VVWD meeting, the board once again entertained an offer to purchase some river water shares from a local owner.

Once again, because that shareholder's last name wasn't "Hardy," they declined.

That's to their credit, because we still have people trying to soak the water district for $70,000 a share on water that just seven years ago was going for $6,000 a share.

As a reminder, we can thank greedy moneygrubbers like Dixie Leavitt and the Southern Nevada Water Authority for doing the exact same thing to the price of water shares that greedy realtors and land speculators did to housing prices a half-decade ago - driving up prices to artificially unreachable levels for no good reason other than to line their pockets.  Leavitt started the ball rolling when he sold a huge chunk of water shares to SNWA for an obscene amount of money. As it is in the real estate business, that set the "market price" for water, and was the starters pistol for the price race to the moon.

On Tuesday, VVWD general manager Ken Rock offered a sound fiscal warning to the board: If you buy a water share for $70,000, then turn around and lease it to the golf course owners for $250 a share (a horrendous decision the board made last year), it will take about 280 years to pay off the water share.  And that's without interest!

It was a brilliant piece of financial advice.  In fact, it sounds vaguely familiar.  Who said that exact same thing last year?  Oh that's right, it was US!

Unfortunately, Rock (who is the best thing to happen to the Virgin Valley Water District in more than a decade) also fired another shot across the bow on Ordinance II fees, the made-up fee the water district charges for the alleged purpose of buying more water on the open market.

He pointed out that collecting $3,300 in Ordinance II fees for every new house built in the Valley while spending $70,000 per share for river was another losing proposition. 

On paper, he's right.  Figuring $3,300 per house, two houses per acre foot of water, and about seven acre feet per share, it comes to around $46,200.  While VVWD math would call that "break even," the rest of the world would call it a $23,800 loss.

This is where today's exercise comes in.

Instead of adjusting the leasing costs of those shares to the golf course owners from $250 a year to $7,000 a year, which would pay off the purchased shares in 10 years, the board is once again hinting that they need to increase the Ordinance II fees.

The part they keep forgetting in their smoke-and-mirror calculations is this: The $70,000 figure is for Virgin River water shares, meaning irrigation water.  Guess how many homes and commercial buildings in Mesquite use irrigation water?  Show us the answer on the big board, Johnny!  That's right, ZERO!

VVWD does not and never has pumped river water into homes.  Every drop of potable liquid comes from underground aquifers.  So NONE of the irrigation shares the water district is buying for 70 grand is going to the new houses - you know, the buildings that are getting charged $3,300 a pop when built.

So once again, those who are building and buying homes are paying for water shares that are only benefitting the golf course owners!  And the rate increase that you know is on the way will once again hurt the home buyers, put more downward pressure on the construction industry and new housing (because when you pile on all the ordinance and impact fees charged by the water district and the city of Mesquite, it's basically cheaper to build a house in Palm Springs), and all to make sure the golf course owners continue to have all the cheap water they can waste.

By the way, that water we actually drink?  You know, the water that is pumped up from underground?  We can't buy shares of that water, because by law it is all owned and doled out by the State of Nevada.  We have to file for permits, and of course there are costs associated with that, but the water itself is 100% FREE to the VVWD.

But with the VVWD's smoke-and-mirror accounting system, that fact won't be considered in the next round of price increases.

Which is why ratepayers need to continue with their daily exercises, so they're ready when that inevitable fee increase is approved.