Grover Beach reverses course, drops rate increases after leaving controversial water project

More than five months after the Grover Beach City Council voted to raise the city’s water and sewer rates to pay for the controversial Central Coast Blue water recycling project, the council decided to reverse course Monday.

In a pair of decisions, the council voted unanimously to pass a resolution officially severing ties with the Central Coast Blue project and 3-1 to revert the water rate structure back to its pre-Dec. 11 rate established in 2021, with Councilmember Zach Zimmerman voting against revising the rate and Mayor Karen Bright absent from the meeting due to illness.

The votes came after the council explored how best to amend the previous water rate ordinance, which called for rate increases as high 91.8% between 2025 and 2028 for some customers, according to a study performed by Tuckfield & Associates.

The increases were intended to fund the Central Coast Blue project, which hit a wall when the cities of Grover Beach and Arroyo Grande started the process of backing out of the project in recent months due to skyrocketing costs and winter rains that alleviated some of the drought conditions that necessitated the project.

In the process of withdrawing, the city then was faced with the question of what to do with its elevated water and sewer rates, which spawned a letter-writing campaign and subsequent trio of recall campaigns against Bright, Zimmerman and Councilmember Daniel Rushing.

Pulling out of Central Coast Blue is not without consequences, city manager Matt Bronson said; the city has invested around $1.6 million into pre-construction costs and has yet to pay around $225,000 of those existing costs.

Staff initially presented the City Council with a revised water rate structure that would remove all increases related to future construction expenses for Central Coast Blue but still included enough funding to pay for all existing water projects and maintenance costs, Bronson said during the meeting.

This revised structure also raised rates enough to pay for a $300,000 independent, third-party water rate structure analysis that would be carried out over the next year to assess where the city could next look for a water resiliency solution, Bronson said.

Compared to the proposed Central Coast Blue rate structure — which would raise rates 19.7% each year between 2024 and 2027 — costs would only rise around 5.2% in 2024, 2025 and 2026, followed by 3.5% increases in 2027 and 2028.

Bronson said the staff’s revised structure would result in an increase of around $4.50 per month for an average user, and the city’s rates would continue to be the lowest in San Luis Obispo County through 2028.

In the end, however, the City Council ultimately opted to ditch the rate increases entirely, approving a wholesale reversion of water rates, meaning rates are only set to rise by 4% at the start of 2025 and 2026.

“The lack of additional water at some point down the road could lead to a moratorium or not being able to issue building permits,” Bronson said. “We’re not projecting that to happen right now, but at some point, that could be a reality if we don’t secure additional water to supply our community.”

According to staff projections, Grover Beach should make efforts to acquire an additional 510 acre feet of water per year by 2050 to ensure the city has a solid buffer of water separating it from drought, Bronson said.

Draft recommendations for future water resiliency efforts and the analysis of water needs will be coming sometime in early 2025, Bronson said.

In the meantime, the city will start its 180-day withdrawal period from the Central Coast Blue Joint Powers Authority, Bronson said.

The city’s withdrawal will next be addressed at the project’s June 3 meeting, Bronson said.

Several Grover Beach City Council members facing recall effort

The water rate adjustment — and recent collapse of the planned Central Coast Blue water sustainability project — has been the source of friction in the South County in recent months.

The day after Grover Beach formally pulled out of the project, the city of Arroyo Grande’s City Council elected to do the same.

Former Grover Beach mayor Debbie Peterson organized a protest letter-writing campaign in October and November last year that fell short, and then went on to organize GroverH2O to represent citizens who oppose the Central Coast Blue project and associated water rate increases.

In an April 26 lawsuit, GroverH2O alleged the group’s attempts to submit recall petitions against Bright, Rushing and Zimmerman were stymied by city clerk Wendy Sims and other parts of the city government in recent months.

According to the April 26 court filing, GroverH2O’s lawsuit alleges Sims and the city interfered with the organization’s recall campaign by unlawfully rejecting legally compliant recall petitions.

In recall petitions, proponents must submit copies of the petition to the elections office, starting a 10-day window for the election official to determine whether its wording meets the requirements of the Elections Code, GroverH2O said in its argument.

According to GroverH2O’s complaint, Sims rejected the petition to recall Zimmerman because he allegedly did not sign his answer within the statutory deadline for the recall, and requested the petitioners remove or change two sentences from GroverH2O’s petition that were considered “false, misleading and inconsistent with the requirements” of Chapter 1 of the Elections Code, according to the lawsuit. Those were:

• “Dan Rushing voted to make Grover Beach the industrial area of Pismo Beach and Arroyo Grande.”

• “Dan Rushing approved a project to tear up newly repaired residential streets for 16 wells, a mile of pipelines, and a wastewater treatment plant in Grover neighborhoods.”

GroverH2O argued Sims should not have been able to unilaterally reject petitions based on her subjective assessment of whether the statements in the petition were true or not, and said only an impartial judge can decide if language is false or misleading.

In requesting that language be altered or eliminated and potentially removing candidates from the recall ballot, the city’s denials constituted an “especially egregious violation” of the recall filers’ constitutional rights, the group argued.

Peterson told The Tribune that GroverH2O’s lawsuit was only necessary because the city was obstructing the recall efforts from proceeding for minor reasons that weren’t in the purview of the city clerk.

In the lawsuit, GroverH2O defended the language used in the petitions by claiming the statements were “neither false or misleading.”

“It’s opinion, but it’s not an unreasonable opinion,” Peterson told The Tribune.

She said the group has not removed or altered the aforementioned lines about Rushing because supporters of the recall signed off on a petition that included those specific statements.

Deadline looming for recall petitions

Peterson said GroverH2O has already submitted a sixth petition filing that incorporates “everything (the city) asked for” but said the group would accept whatever decision a judge reached in the lawsuit.

She said the greatest enemy the recall campaigns currently face is time.

The Bright and Zimmerman recall efforts already will not appear on the November ballot due to deadline issues, but GroverH2O is still looking to attempt to recall Rushing this November, with the deadline of June 5 to get a legally-compliant petition signed and turned in to the city, Peterson said.

If the recall cannot get on the November ballot and if the city accepts the petitions, a special election would need to be called— potentially costing hundreds of thousands of dollars, Peterson said.

In a statement to The Tribune, Grover Beach city attorney Robert Lomeli said the city does not comment on specific allegations or statements related to existing lawsuits.

“The city maintains and asserts that the city clerk’s actions regarding the petitions submitted by Grover H2O have been in accordance with the California Elections Code and applicable judicial precedent, and disputes any assertion to the contrary,” Lomeli said in the statement.