Is it reasonable to borrow from the future to solve a problem that doesn’t currently exist?
That’s the path that the City Council voted to go down this week as it continues moving forward on building a sewage treatment plant on the golf course. The City prefers to call it the “Golf Course Modernization Project.” But make no mistake about it, sewage will be processed to make water the City says will be clean enough to irrigate the golf course and the medians. But, not clean enough for barefoot children to play in.
Is there any amount of money that is too much? Because, so far, the City has spent upward of $1 million to study the project and proposes to spend nearly $30 million in total to build. The numbers the City presents suggest that the project breaks even in year 19. But it doesn’t. If you look carefully at the numbers prepared by the City and presented in the March City Council packet when an earlier vote on this project was taken, year 19 shows a sort of “break even” for that year alone. But scroll over to the last column and you will see that the project will have accumulated $15 million in losses in the previous 18 years and that even after 30 years, will still have cumulative losses of $2.3 million. And be aware that these are pretty rosy projections which include no major maintenance costs and show revenues consistently growing faster than expenses (nearly twice as fast). To be clear, even with the rosy projections, the facility is never projected to break even.
And really, who knows what the total price tag will be? Originally, when the City began discussing this, the number was closer to $5 million. So, clearly this is all a moving target. The next time we see this project on the City Council agenda, will the number be closer to $60 million? Or more?
And what’s the rationale again? The City says that sometime in the future, we might have to ration water and the prices of water might be really high. Maybe. But, that’s not a problem that we have today. And even if we want to ration water today, perhaps there are better ways of starting than building a plant that will cost tens of millions of dollars.
To put it a different way, the City is taking future dollars to pay to solve a problem that it guesses might exist in the future. But what if the City has guessed wrong? What if Coronado actually ends up facing a different problem in the future? Where will the money come from to solve that problem?
Residents are just now beginning to become aware of this issue – as witnessed by letters and speakers at the Council meeting this week. And some are very concerned. They are concerned about the spending, especially given the apparent lack of consideration of alternatives and the high price tag that keeps getting higher. They are also concerned about the potential environmental impacts that won’t be fully analyzed since the vote last week was in favor of a “negative mitigation declaration” in lieu of a full Environmental Impact Report. And this was based on the initial environmental report being done by the same firm that was hired to do the feasibility study. So, residents are also concerned that perhaps the process has not been as transparent or forthright as maybe it ought to be. And, naturally, they are worried about the potential impact that the plant will have on their property values.
This commitment is one that should not be taken lightly. Aside from the cost of the plant itself, by building it, the City commits itself to operating it indefinitely.
Perhaps it is time to consider a similar situation that happened in Gainesville, Florida starting around 2009. There, the City projected that the cost of natural gas was going to go so high that it should build its own biomass facility. It made a lot of sense, they said. It would be green, good for the environment, and would save money on power in the future. What happened? Well, over the years, the costs to build went up and the price of natural gas went down. The savings never materialized and the ongoing maintenance of the facility was too much too bear. Eventually, in 2017, the City paid $750 million dollars to permanently shut down the facility.
Maybe it’s time for the City and Council to pause and reconsider its “Golf Course Modernization Project,” which appears to have little to do with golf other than giving it an alternate source of irrigation through gray water.
Who remembers the Coronado Traffic Tunnel Advisory Vote or Measure H (2010) that was put to the voters after the City had spent a million dollars of its own money along with other funds studying traffic? Measure H was an advisory vote with no binding authority which asked voters: “Do you support the city continuing to use and seek federal, state and local funding to complete the study of long-term traffic-relief options, including a tunnel, between the Coronado Bridge and Naval Air Station North Island?” Measure H was defeated by a vote with nearly 67% opposed.
Is it time for the City to take the golf course question to the voters?