RANCHO MURIETA, CA (MPG) - Director Randy Jenco led the charge at the March 19 Rancho Murieta Community Services Board meeting when he won approval of a $4 rate increase to help fund the reserves and a resurrection of a barcode sticker fees ordinance to fund 24-hour security.

Reserve Rate Increase

Jenco’s proposal to increase the monthly reserve contribution from $14 to $16 for water and wastewater followed a presentation by Mark Matulich, director of Finance and Administration, who outlined the draft proposed budget for 2025-26.

Matulich proposed a minimal increase in the operating budget, $9.583 million, compared to 9.521 million this fiscal year, a $62,480 increase of .07%. That translated into a very modest increase in customer rates for next year. 

Under his initial proposal, the average customer inside the gates would have seen a monthly increase of $6.81, representing a 2.5% rise. Starting in July, the current monthly rate of $271.97 would increase to $278.79.

However, adding in the increased reserve fees approved by the board, the proposed monthly rate will increase to $10.81, representing a 3.97% rise. Starting in July, the current monthly rate of $271.91 will increase to $282.18.

Matulich used a PowerPoint presentation to explain the draft of the proposed budget. He said the overarching goal for the 2025-26 fiscal year was to achieve a balanced operating budget, ensuring that operating revenues for each of the five funds—water, wastewater, drainage, security and solid waste—cover their respective operating expenses.

The proposed budget includes 24-hour security coverage of the gates and patrol shifts, partially funded by an annual barcode sticker fee of $10 per vehicle.

Matulich stated that the proposed budget allocated all $970,000 in anticipated county taxes to the reserves and the $1,042,733 generated through the $14 reserve contributions. Combined with other revenue sources, a total of $2.626 million would be directed into reserves.

The board appeared satisfied with Matulich’s budget review. It seemed poised to move on to the next part of the agenda item—authorizing the issuance of the Proposition 218 notice—when Jenco suddenly remarked, “I’m going to beat this horse to death.”

Although allocating $2.6 million to the reserves sounded substantial, Jenco pointed out that past reserve studies indicated the district should be setting aside two to three times that amount.

“I just don’t feel like we are making any inroads here,” he said.

Jenco acknowledged that people are reluctant to pay more for anything, whether eggs or water. “But I am willing to take the hit on social media because I don’t pay any attention to social media,” he said. “We’ve got to look at this $14, and in my opinion, we ought to make it $16 this year and $18 next year because our next reserve study is going to say the same thing it did six years ago: that we aren’t putting nearly enough money into the reserves.”

President Steve Booth told Jenco he could present his idea as a motion for the board to consider. Jenco promptly moved to increase the reserve contributions for water and wastewater from $14 to $16. His motion also required staff to revise the draft budget and the proposed Proposition 218 notice accordingly.

Matulich reported that the increased contribution would raise the proposed $1.042 million going into reserves to just under $1.2 million.

“That’s a significant amount of money,” he said, adding that amending the proposed budget and Proposition 218 notice would be easy.

During the discussion, Director John Merchant referenced the recent Lumus study, which assessed the district’s infrastructure needs and estimated that $20 million would be required in the short term, with another $20 million in the midterm. Merchant expressed his support for the $2 increase but emphasized that the district would ultimately need long-term financing or bond layering, a strategy used by other water districts to fund major infrastructure improvements.

“Ultimately, what that debt allows you to do is to stretch out your rate structure,” Merchant said.

Operations Manager Eric Houston acknowledged that the $2 increase wasn’t a full solution to the district’s long-term infrastructure needs, but he called it a step in the right direction. He also noted it could contribute to improving the district’s bond rating.

The board concluded the discussion by voting 4-0 to approve the increased reserve contribution, which would result in higher rates. Director Tim Maybee was absent from the meeting.

Barcode Sticker Fees

The discussion about increasing barcode fees arose after Jenco requested that security funding be added to the agenda. The Security Department is currently facing an $80,000 shortfall due to the recent implementation of 24-hour patrol coverage.

The board ultimately voted 4-0 to restart the ordinance process to implement a new $10 barcode sticker fee. The fee is intended to cover this year’s security shortfall and will be included in the budget for the next fiscal year to support continued 24-hour patrol coverage.

In November, the board approved Matulich’s proposal for an amended budget to increase staffing to enable 24-hour patrol coverage starting Jan. 4. However, funding this plan required raising the barcode sticker fee for a new car from $10 to $25 and introducing a new annual per-car fee of $10. Implementing these fees required a two-step ordinance adoption process scheduled for the board’s December and January meetings.

Following the November meeting, the district published a notice about the proposed barcode sticker fee, which sparked an outcry on social media. In December, the board approved the first reading of the ordinance to implement the fee, believing there was enough time to engage with the public before making a final decision. However, when the board reconvened in January, President Booth announced that the Finance Committee had recommended tabling the ordinance and revisiting the fee during the budget process. The board also received emails from 11 residents opposing the fee increase; the emails were included in their meeting packet.

When Booth asked Matulich how tabling the ordinance would impact the security budget, Matulich explained that it would create an immediate $85,000 shortfall in the funds needed to cover additional staffing costs for the remainder of the year. When pressed for alternatives, Matulich said the only available solution would be to use property tax revenue to fill the gap.

Ultimately, Booth, Butler and Maybee voted to table the ordinance, while Jenco and Merchant opposed the motion.

The issue of addressing the shortfall remained unresolved, though both Jenco and Maybee voiced strong opposition to using property tax revenue to fill the gap. They cited the Grand Jury’s recommendation that the district stop relying on property taxes to cover security shortfalls and instead allocate all such revenue to reserves. Jenco reaffirmed that position at the March meeting.

When the security shortfall came up on the agenda, Booth stated that the board faced a choice: fund the $80,000 gap or reduce staffing. He acknowledged that he had initially voted to approve the barcode sticker fee increase as part of the amended budget but later reversed his position after receiving significant public feedback—an action that contributed to the current shortfall.

A lengthy discussion followed, though not all of it stayed on topic.

Booth eventually turned to District Counsel Patrick Enright to ask about the process for revisiting the ordinance authorizing the barcode sticker fee. Enright advised that the board would need to start the process from the beginning.

Jenco promptly moved to restart the ordinance process, which was seconded by Merchant. The motion passed with a 4-0 vote.

Booth then directed Enright “to get us back on track” by preparing a barcode sticker ordinance for a first reading at the next board meeting.