LOMPICO -- The results of Tuesday's elections will usher in renewed talks about merging two water districts in the San Lorenzo Valley, with discussions possibly starting later this month.

The idea of merging the Lompico Water District with the San Lorenzo Valley Water District developed two years ago. Bill Smallman, Rick Harrington and Lois Henry, all of whom support the move, retained their seats on Lompico's board of directors. Their three challengers wanted the district to remain independent, and with at least one current board member in the same camp, a majority vote to drop the idea would have curtailed those discussions.

As the talks move forward, Lompico is focusing on getting its affairs in order and repairing its infrastructure, ensuring the larger district does not inherit a crumbling system. As part of that plan, a rate increase went into effect last year, leaving the small, 494-hookup district with a $23,000 surplus.

But its board still must contend with the financial fallout related to its decision to withdraw from the California Public Employees' Retirement System, a move that could cost as much as $741,000. That news took both districts by surprise, with Jim Mueller, San Lorenzo Valley's general manager, saying the opt-out fee was not part of the "conceptual framework" for the merger.


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"We knew there was a potential liability," he said, but the size of that liability was unknown until recently. That bill is Lompico ratepayers' sole responsibility, and yet another issue the district must contend with before a merger can occur.

The next step, Henry said, is to hammer out an agreement between the two boards that nails down the costs and timeline for the infrastructure repairs, and the terms of a bond measure that would be used to pay for it.

Officials from five water districts, including Lompico and San Lorenzo Valley, hope to hear soon whether the state will provide funds to build a regional system that would tie the systems together for emergency purposes. Lompico's and San Lorenzo Valley's systems would have to be tied together under the merger scenario, so if the grant is approved, it would shave off part of the bond cost. The merger is estimated to cost more than $5 million.

After an agreement is reached, Henry said, the districts will hold a series of community informational meetings to dispel some of the "misinformation" spread about the merger in the lead-up to the elections. The two winners in San Lorenzo Valley's race, Margaret Bruce and Randall Brown, are also pro-merger, Henry added, and can help provide guidance as the process moves forward.

Follow Sentinel reporter Kimberly White on Twitter at Twitter.com/kwhite95066