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Central Basin Water Closes Year on a High Note

July 28, 2021

BY BRIAN HEWS

COMMERCE, CA ~  The Central Basin Municipal Water District (CB) ended its fiscal year on a positive note with a position of strong fiscal stability, a reorganization that has yielded a significant reduction of operating expenses of $1.8 million and improved customer satisfaction.

A significant achievement given the District’s previous governance, operational and fiscal challenges, and attacks by Assemblywoman Cristina Garcia (D-Bell) and Assembly Speaker Anthony Rendon (D-Lakewood), along with Rendon’s Assembly Attorney Alf Brandt, to take over the agency under dubious reasons.

The actions of the three were preceded by corrupt Finance Director Andrew Hamilton, who, among other questionable maneuvers, called CB’s bond rating service to inform the Moody’s contact that CB was in terrible financial trouble.

The communications resulted in a downgrade of CB.

In addition,  after years of dysfuction, some caused by Asm. Garcia’s bill that added directors to the board, others by the corrupt actions of former disgraced GM Kevin Hunt, the District’s Board of Directors has coalesced around their vision of an improved and efficient agency, working together to support the new direction of the District.     

“The District’s Board is very pleased at the recent planning and turn of events leading to a positive fiscal and operating position,” said Art Chacon, CB Board president. “Our new general manager and staff have done a stellar job in turning around a District tapping into the potential to improve the reliability and quality of water for our customers.”

This positive development for CB did not happen overnight but began with the arrival of the District’s new general manager, Dr. Alejandro (Alex) Rojas.

Rojas came to CB as a turnaround specialist tasked to use his prior pubic administrative experience to promote and secure the District’s fiscal stability.

Upon arriving, Rojas implemented a district reorganization resulting in a nearly $1.8 million reduction in annual operating expenses; furthermore, he developed a cross-functional operations team made up of internal employees and external contractors making the District more efficient while improving organizational performance.

Additionally, the District reduced fixed costs for customers by approximately $300,000 per year and approved $1.5 million in grants for recycled water system expansion which will be used to improve local water supply reliability specifically to local disadvantaged communities.

Rojas’ moves generated the highest level of average monthly operating and unrestricted cash reserves since 2016, $12 million, ending the year with $22 million in unrestricted and restricted cash reserves.

“I am very pleased and appreciative of the Board’s support for the District’s concerted plans to vastly improve our fiscal position, programs, services and customer satisfaction,” said Rojas.  “Most significantly we have managed to reduce the cost of imported water by 14% for customers during a drought. The District also kept its recycled water rates unchanged, further reducing the cost of water for its customers.”

Despite a projected statewide drought, the CB Board of Directors took action during its monthly May 24 Board meeting and approved a 14% reduction in imported water rates for customers in its service area while other districts are raising their rates.

Many California counties are currently under a severe drought forecast precipitated by low water levels and little snow in the Sierras. This has been the second dry year in a row, and 2021 might bring some additional changes.

“It’s important to remember that one of the principal reasons Central Basin is able to lower water rates is that we have taken prudent measures to regain fiscal control of our budget,” Rojas continued. “Our goals for the District have been to lower the cost of imported water, ensure our long-term fiscal stability, improve customer service, diversify our revenue streams, and grow our recycled water services. With our final report we believe we have accomplished that goal.”

“As a Central Basin customer, we are incredibly pleased the District is working with all its customers to ensure its service areas have a reliable and diverse source of high-quality water at affordable rates, particularly at a time when local governments have been impacted by the pandemic,” said John Oskoui, Assistant City Manager, City of Downey. “The Board’s actions reflect a new direction for Central Basin which has started to form collaborative partnerships with its customers and take the necessary steps to ensure the District’s long-term fiscal stability.”

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