In an article ("MWD's Cup Runneth Over," Commentary, May 1), Assemblywoman Gwen Moore criticized the Metropolitan Water District for its financial reserve policies. We are, of course, pleased with the assemblywoman's interest, but wish to correct any impression that MWD has a surplus of funds.
MWD has different legally required reserve accounts such as its bond indebtedness reserves. In addition, the board has established a water rate stabilization fund. That fund is used to keep consumers' water costs at a manageable level and, for a number of sound reasons, has the strong support of the 27-member agencies comprising Metropolitan.
MWD's reserves provide consumers the following: (1) a financial buffer against wide swings in water rates caused by rapidly changing economic and weather-driven water supply conditions; (2) a source of funds that the district may use to support a $6-billion distribution system construction and improvement program; (3) a cushion necessary to achieve an excellent bond rating that translates into savings of hundreds of millions in additional interest costs, and (4) a source of funds to purchase needed water from the governor's emergency water bank which will alleviate hardships this year and provide storage against another dry year.
Metropolitan's financial policies have given its 15 million consumers something to be coveted in today's economy--a public agency that is not facing a fiscal crisis.
LOIS B. KRIEGER, MWD Board Chairman, Los Angeles