Sean Janssen, The Union Democrat

A year-long process to transfer water and sewer services managed by the Wallace Community Services District to the Calaveras County Water District system reached fruition Tuesday just as CCWD's possible annexation of the Blue Lake Springs Mutual Water Company went off the table.

CCWD directors voted 5-0 to accept the Wallace transfer, nearly one year after a Dec. 27 agreement between the two districts to seek approval from the Local Agency Formation Commission to make the switch.

A regulatory climate growing in its complexity, a small electorate from which to draw directors, a financial situation where the district draws on road funds to cover water and wastewater costs, a paid staff limited to one part-time employee and long-term decline in western county water levels were each cited as reasons for the move by WCSD directors and staff.

The community of about 200 residents voted to form an assessment district that will introduce a parcel tax to pay for infrastructure improvements to the water and sewer systems. Those improvements are required to bring the system up to CCWD standards and keep current CCWD customers from having to subsidize the smaller system.

CCWD Assistant General Manager Larry Diamond said former WCSD customers should begin to receive CCWD bills next month.

WCSD will continue to manage the roads, lake and dam within the small community on Highway 12 in western Calaveras County.

Meanwhile, a potential much larger annexation east of Arnold is no longer in the works.

CCWD stopped providing water to the private Blue Lake Springs Mutual Water Company in March 2011 after discovering the company had been utilizing that water to meet about half of its customer needs. An agreement between the two utilities called for CCWD to provide water to Blue Lake Springs only on an emergency basis.

At last month's CCWD board meeting, BLSMWC board president Bob Maginnis told CCWD directors and staff that Blue Lake Springs had determined it can meet its customers' needs using its own wells but asked if an agreement could be reached in which CCWD water might serve as a backup supply for days at a time during routine maintenance on the system. Stump replied that doing so would constitute a variance of CCWD policy that cannot be granted without setting a troublesome precedent.

CCWD staff noted Tuesday that BLSMWC had requested a refund of a deposit made to explore a possible annexation, thus ending the preliminary exploration of such a move.

Stump said he would not be surprised to see another approach from BLSMWC if its efforts to expand on its well system are unsuccessful.

"It may be a few years … but I don't think we've seen the end of Blue Lake Springs," he said.