The water company for the American Project (ASADA) has asked its six employees to take a pay cut 25% of their salary beginning in February. The move is part of the ASADA’s effort to manage with decreased revenues while seeking regulatory approval for a higher rate schedule and impact fees for new project water hookups.

According to Water Board President Rick Walker, the employees understand the financial pressure the system faces and have all agreed to the pay reductions, which will allow the company to maintain its standards of service through the current year.

The ASADA has also asked its landlord, the Nosara Civic Association, to forgive its rent during this period, and so the NCA, during its annual meeting on January 25th, decided to approve the request.

The ASADA is also considering cutting back its office hours and will not be replacing its longtime administrator, Linda Cox, who recently submitted her resignation. Asked why she resigned, Cox declined to comment.

In late 2009, the ASADA was told by the national water regulatory authority, AyA, that its rate, much higher than the prevailing approved rates in Costa Rica, was out of compliance with new rules governing local water rates. A steady 78% of customers have voluntarily continued to pay the rate that was in effect prior to the adoption of new rules by AyA, Walker said. The shortfall, along with the inability to charge the impact fees on new water meters, has created the budget squeeze and now the ASADA must reduce its expenses on an average of $5000 per month.

Currently the ASADA has hired an accounting firm, Jausas, to audit the ASADA as part of the process for seeking approval for the higher rates that were previously in effect locally. The audit includes a financial review as well as an examination of the system’s infrastructure, and is due in March.

Walker said it has also been necessary to hire a specialized law firm, Facio Abogados of San Jose, to navigate the regulatory process for the rate schedule change, and a second firm, Legal Corp. of San Jose, to seek approval of the impact fees.

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