Clovis schools forgo rate-hike challenge

The Clovis school board voted not to challenge a water-rate increase that could cost the schools an estimated $25,000 more per year.

The New Mexico-American Water Company proposed about an 18 percent water-rate increase on May 24. The city and school district intervened in hopes of blocking the increase.

New Mexico-American and the Public Regulation Commission officials negotiated a compromise to the water company’s original request. Attorney David Richards, who represents the city and schools, released the negotiations results Tuesday evening.

Richards said a tentative settlement would reduce the proposed increase from 17.47 percent for residents to 11.1 percent. The schools and city-rate increase reduction would be from a proposed 17.17 percent to 17.05 percent.

The city, school district and residents are each considered separate entities.

The city and school district receive a reduced water rate, which they feared would be eliminated by an increase. Richards said the 17-percent increase for schools and the city cuts into the reduced rate but does not eliminate it.

According to Richards’ projections, the 17-percent increase would cost the school district and city between $25,000 to $30,000 more each year for each entity.

Richards said the school board had three options: Endorse the compromise decision, object and challenge it or take a neutral stance. Richards recommended a neutral stance, saying lawyer fees and witnesses would make challenging the decision costly.

The board voted unanimously not to challenge the decision but not to endorse it.

Clovis Schools Superintendent Neil Nuttall put the increase into his perspective.

“It will cost us a computer lab for one of our schools each year,” Nuttall said, estimating a new lab at about $30,000. “We’re not going to get that money from anywhere else.”

Water company officials have said the increase is needed to fund new drilling and replace water mains and meters.

Board member Ken Merritt said the board was put in a “no-win situation.” If the board chose to challenge the decision it may have been more costly to the schools, he said.

“It is difficult when that money is going to cost us something that the kids need badly,” Merritt said. “(The water company) has a business to run, but to me there ought to be another solution other than taking it from the schools.”

He expects the city commission to make a similar decision at its Oct. 21 meeting.

Richards said he expects final hearing between the PRC and New Mexico-American Water and a final decision to be made in November.

The last water-rate increase came in 1999. Richards said it is likely another could come in two to three years, further cutting into or wiping out reduced rates for the school district and city.