Lawsuit forces Nipomo CSD's financial hand



Perhaps everything was legit as far as the April-approved Nipomo water pipeline financing proposal was concerned, but when faced with a lawsuit, the Nipomo Community Services District decided to go the safe route and find an alternative to finance $4 million of the $17.5-million project.

The financing in question is a portion of the proposal that allocates $4 million from the district’s water reserve funds—money specifically designated for maintenance and repair of existing infrastructure—to pay for the project. The Mesa Community Alliance filed a lawsuit against the district because the group believes taking money from the reserve fund to pay for new infrastructure is illegal.

The alternative financing plan approved by the district’s board on May 10 has the district borrowing an additional $4 million to replace those reserve funds.

District General Manager Michael LeBrun said the district believes the initial proposal is legal, but decided to go the alternative route to move the project along. LeBrun said the lawsuit has the potential to hold up the project, which is already up against hard deadlines. By removing the crux of the lawsuit, the district is hoping the suit’s request to stall the project will be denied.

The water pipeline would bring a much-needed additional source of water to Nipomo, an area that’s been locked in a water war since the court handed out its final judgment for water rights in the Santa Maria Groundwater Basin in the mid-’90s. The court mandated that the district buy 2,500 acre-feet of water a year from the city of Santa Maria.

The recently approved project would bring Nipomo 650 to 900 acre-feet of water a year from Santa Maria, and is considered phase one of a larger three-phase water project.

LeBrun said the permit Nipomo has with the California Department of Fish and Wildlife only gives them access to the Santa Maria riverbed from April 15 to Oct. 31.

“We won’t want to enter the river unless we can complete the work before the Oct. 31 date,” LeBrun said. “If our project slips another year, we could lose our $2.2 million [state] grant.”

The district needs to award a construction contract by June 26, or the project could also lose another year. On May 13, the district went to the initial hearing for the lawsuit and was awarded a hearing date for later in the month. The next regularly scheduled board meeting is May 22 at 9 a.m. in the District Board Room at 148 South Wilson in Nipomo.

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