Supervisor Bruce Gibson had previously declared that “Prohibition Zone” homeowners would pay for San Luis Obispo County’s $200 million Los Osos Wastewater Project one way or another, and on December 14 he delivered on that promise – sticking them with the most expensive per capita sewer project – and sewer bill – in U.S. history, to be built in an officially-declared “disadvantaged community” in the middle of the “Great Recession.”

Los Osos sewer rates & charges ordinance passes; protest falls far short. Outlook grim for many long-time residents.


“I believe most in the community know that we have made a tremendous and deep commitment to addressing affordability to the best that we possibly can.”
—Supervisor Bruce Gibson

Supervisor Gibson had previously declared that “Prohibition Zone” homeowners would pay for the County’s $200 million Los Osos Wastewater Project one way or another, and on December 14 he delivered on that promise – sticking them with the most expensive per capita sewer project – and sewer bill – in U.S. history, to be built in an officially-declared “disadvantaged community” in the middle of the “Great Recession.”

Coming one week after Pearl Harbor Remembrance Day and a week and a half before Christmas, the timing of the historic sinking of a community with an economics-logic-defying sewer project — priced to drive thousands out of their homes — couldn’t have been more agonizing for residents, while the Board of Supervisors didn’t even blink.

In a 5 to 0 vote, San Luis Obispo Board of Supervisors voted to establish rates and charges averaging about $250 per month for single-family homeowners in Los Osos’ so-called “Prohibition Zone” (PZ) selected to pay for the County’s project. Some homes could pay as much as, or even more than, $400 a month, depending on the volume of water usage.

The 45-day protest period ending with the December 14 hearing failed to yield a successful protest of a “50% plus one” majority of PZ homeowners needed to reject the rates. The County Clerk reported 801 protest letters had been received prior to the board passing the ordinance, or about 15% of all parcels notified. For the protest to be successful, according to the County, 2,632 protest letters out of 5,262 properties would have had to be received by the County by December 14. It wasn’t close.

Keith Wimer of the Los Osos Sustainability Group, a leader in the struggle for County recognition of the town’s exploding saltwater intrusion crisis, did his own “Monthly Sewer and Sewer-Water Cost Estimates for Single-Family Homeowners” study and “had to go to three sources to get the total costs.”

Said Wimer about his protest and research, “The first reason I’m protesting is that the Los Osos Wastewater Project does not mitigate for what are sure to be devastating social and economic impacts on homeowners and businesses in Los Osos. Monthly sewer costs for single-family homeowners will be $240 on average and will go to $380 and above. Monthly sewer water costs will be $260 to $270 and they will go to $410 and $480 and above. Sewer costs don’t include increases that are coming our way due to seawater intrusion… The median household income dropped 4% or more from 2000… About 25% of families will have sewer costs six times higher than their affordability levels… Atlanta, cited as the highest sewer rates in the country, in 2012 they’re supposed to be $150 for water and sewer. We’ll be double that, so we’ll best them by at least double. 

“People should not lose their homes over the sewer,” he said, “and they will.”

[Keith Wimer’s remaining comments: “There are safeguards in the law to prevent (people from losing their homes), and they’re not being observed. A thorough analysis of the social and economic impact on the community and businesses must be done with specific mitigations in place prior to approval of another ordinance. Number two, the project apparently has several significant unfunded costs that require future rates and charges… Number three, the project has no mechanism to ensure future costs will be in check… A thorough life-cycle cost comparison of alternatives on an equivalent cost basis was never done – NWRI (National Water Resources Institute) said to do this. The STEP project will be $50 million less, a decentralized project will be $40 million less – they both do more for the environment, and if you put in the plant the Los Osos Sustainability Group is recommending, you can balance the basin at the same time for $40 million less. On-site systems are less than this project. The design-build process was abandoned for the collection system you said that we would see costs, actual costs and actual designs. A thorough cost-benefit analysis, a risk analysis of the project has never been done. This project can do more harm than good… for $190 million. You’re never going to balance our basin. Purveyors are planning to treat the water once it comes out of the ground, anyway. A pump and treat process is more cost-effective than a sewer… What are we doing?”]

While the protest was doomed to fail because the high number of protest letters required to reject the rate structure represented a statistical Mt. Everest, Los Osos homeowner Bo Cooper reminded the board that 801 homeowners went to the trouble of mailing in a protest, and in fatalistic Los Osos, where more than 60% of homeowners didn’t respond to the first Proposition 218 vote giving the County a blank check for the project, 801 protesting homeowners is significant because it represents a much larger number than the protest indicates.

“800 property owners multiplied by two and a half, three (people) per household – about 2,000-2,500 people – say ‘Hey, I can’t afford it. I need help.’ And help is not forthcoming at this point,” said Mr. Cooper, urging the board to read the “anguish” in some of the protest letters. “You (board) need to reassess what you’re doing.”

Lacey Cooper, asking the board to reject the ordinance based on every recognized affordability standard, pointed out that the 801 protest letters represented 25% of actual PZ homeowners, whereas the County’s announced protest figure of 15% included non-homeowner categories such as vacant lots and rentals.

“I wanted to mention (the city of) Eureka because they rejected a water and sewer rate hike,” said Mrs. Cooper. “They have 10,000 property owners, almost twice as many as we do – they only had 751 valid protest letters. But, although not enough protest letters were sent in legally to stop the rate hike, the council members agreed that the rate hikes were too high for people to handle at this time, the notification process was too confusing, and senior citizens shouldn’t be hit with such high rates.

“You (board) don’t have to pass this today, and I urge you to take a look at it again. And I ask that you do a 218 on the undeveloped properties for that $27 million (added on to PZ homeowners’ rates and charges on this 218) because they can pay in 2014 just like we (PZ homeowners) are supposed to do. Legal isn’t always what’s right and common sense, so you don’t always have to do that,” said Mrs. Cooper. “Eureka did not do that.”

During public comment, other shocked Los Osos homeowners referred to the rates as “terrifying” and “horrific.” The LOCSD and County are making no effort to track the sewer-driven exodus of homeowners that started in 2007 with the forced passage of the Prop 218 assessment of $25,000 per home. At the time, Supervisor Gibson assured Los Osos homeowners that the $25,000 was the total amount they would have to pay for the sewer – when he knew, but didn’t say, that they would be paying additional user fees and other charges in the future. Without maximum contracts keepin
g a lid on construction costs, the final price of the sewer won’t be known for years. Meanwhile, the exodus of homeowners is expected to grow as mandatory connection — and homeowner commitment of thousands of dollars to it — draws closer.

Some Gibson promises are meant not to be kept, and for the besieged community of Los Osos the sky-high monthly rates & charges bill was one of them. One Gibson promise that should have been kept, but wasn’t, was following through on the competitive design-build process to deliver the community the best-value, most affordable project, a promise Gibson quashed when STEP threatened to substantially under-bid MWH gravity collection, which the County favors, despite the appearance of conflict of interest in the County’s sole-sourcing practices involving MWH at the same time MWH is in the national spotlight for its business practices in several states. MWH is also under the microscope in neighboring Morro Bay for some of the same monopolistic tactics deployed by the global giant in Los Osos.

Though the County has said it will not begin to collect rates & charges until 2014, when the plant is scheduled to be operational, they will begin drawing on the assessment by adding it on to PZ homeowners’ December 2011 property tax statements. It is unknown at this time when and how much homeowners will have to pay for connection and septic decommissioning fees that could run into the mid-thousands of dollars depending on degree of difficulty. Mandatory hook-up to the sewer is part of the rates & charges ordinance. These initial property tax-based “sewer bills” and expenses requiring extra cash are sure to hit the community hard.

Said Gibson on passage of the ordinance, after repeating himself about the repetitiveness of the process: “I wish that we could choose to do or not do this project based on whether it cost a certain amount or cost less than a certain amount, but that’s not the situation that we find ourselves in. We are going to have to do this project – should we choose to pass the resolution to proceed – and we’re going to do it at the most affordable price that we can…”

Unfortunately, Gibson willfully deprived the community of any choice of project or price, and as a result the situation that most Los Ososans find themselves in today is having to face leaving their homes and moving out of town within in the next few years. Because, contrary to Gibson’s hollow claim, Los Ososans know first-hand, and more will come to know by the thousands, that he is simply lying when he says the County has addressed affordability “to the best that we possibly can.”