San Diego County Water Authority Board Meeting Documents April 25, 2019
Committee
Administrative and Finance
Engineering and Operations
Imported Water
Legislation and Public Outreach
Water Planning and Environmental
Formal Board
On April 9, Congress passed implementing legislation for the Drought Contingency Plan, capping years of collaborative efforts among the seven Colorado River Basin states and the Bureau of Page 1 of 146 Reclamation to minimize the impacts of long-term drought in the river basin.
NOTICE TO THE PUBLIC
BOARD OF DIRECTORS’ AND STANDING COMMITTEES’ REGULAR MEETING APRIL 25, 2019 BOARD ROOM WATER AUTHORITY HEADQUARTERS BUILDING 4677 OVERLAND AVENUE, SAN DIEGO, CALIFORNIA
1. UNIFIED AGENDA: This unified agenda provides a brief description of each item to be considered by the Board and its Administrative and Finance, Engineering and Operations, Imported Water, Legislation and Public Outreach, and Water Planning Committees. For convenience, the agenda for each of the Committees and for the formal Board meeting are stated separately; however, all agendas shall be considered as a single agenda and any item listed on the agenda of any Committee may be acted upon by the Board. All items on the agenda of any Committee, including information items, may be deliberated and become subject to action by the Board.
2. DOCUMENTS: Staff reports and any other public information provided to the Board or Committee before the meeting relating to items on the agenda are available for public review at the San Diego County Water Authority 4677 Overland Avenue San Diego, CA 92123 during normal business hours. Additional documents may be distributed at the meeting. Copies of individual items, including the background information, are available through the Clerk of the Board at (858) 522-6614.
3. MEETING TIMES: The morning session of Standing Committees will commence at 9:00 a.m. on April 25, 2019 the afternoon session of Standing Committees may commence at the conclusion of the morning session and earlier than 12:45 p.m. Please see the meeting schedule. The meeting of the full Board may begin as early as 2:45 p.m. or as soon thereafter as the last Committee meeting is completed.
4. ACTION AT COMMITTEE MEETINGS: Committee meetings are also noticed as meetings of the Board because a quorum of the Board may be present. Members of the Board who are not members of the Committee may participate in the meeting, but only members of the Committee may make, second or vote on any motion or other action of the Committee unless the Board determines to convene for consideration of action on an item or items on the Committee agenda. Items receiving substantive review by a standing committee are generally included on the Consent Calendar for action at the meeting of full Board. Persons interested in an item and wishing to hear the staff report, present oral or written comments, and hear the deliberations should attend the Committee meeting. Closed Sessions also occur at Committee meetings and may not be repeated at the formal Board meeting.
5. CONSENT CALENDAR: The agenda contains items listed on a consent calendar which is for matters considered routine or otherwise not requiring further deliberation. A committee or the Board will take action as recommended by one motion. There will be no individual discussion on such items prior to the vote unless an item is removed for discussion. If a member of the public
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wishes to talk about a consent calendar item, please notify the Chair before the calendar is called. Persons who wish to be heard on an item are encouraged to speak before the assigned committee.
6. PUBLIC HEARINGS: It is not necessary to notify the Chair if a member of the public wishes to speak on items listed on the agenda as public hearings. Public hearings will begin at the time stated in the notice, or as soon thereafter as the matter can be heard. When the Chair opens the hearing, upon invitation of the Chair, step to the podium and begin by giving your name and address for the record. Each speaker has 3 minutes to address the Board.
7. PUBLIC COMMENT ON MATTERS NOT ON THE AGENDA: The agenda provides an opportunity for members of the public to address the Committees and Board on matters of interest within the jurisdiction of the Committee or Board that are not listed on the agenda. The Brown Act does not allow any discussion or action by the Board or staff on matters raised during public comment except: 1) to briefly respond to statements made or questions posed; 2) ask a question for clarification; 3) receive and file the matter; 4) if it is within staff's authority, refer it to them for a reply; or, 5) direct that it be placed on a future board agenda for a report or action.
A reasonable amount of time will be allocated by the Chair for public comment. Persons wishing to speak should notify the Chair before the meeting by filling out a "Speaker Request Form" and give it to the secretary. Individual speakers are requested to be as brief as possible and are encouraged to address the appropriate committee who is best able to respond. When the Chair calls, please immediately step to the podium and begin by giving your name and address for the record. Each speaker has 3 minutes to address the Board.
8. PUBLIC COMMENT ON AGENDA ITEMS: Persons wishing to speak to an item that is listed on the agenda should notify the Chair before the meeting by filling out a speaker request form and giving it to the secretary. Step to the lectern when asked to do so by the Chair and begin by giving your name and address for the record. Remarks should be limited to three minutes.
9. INFORMATION ITEMS: Items are listed on the agenda as information based on staff's judgment. Circumstances or the committee's or Board's judgments may require deliberation or, if necessary, action on these items. Any member of the public with an interest in one of these items should review the background material and request information on the possible action that could be taken.
10. ASSISTANCE FOR THE DISABLED: If you are disabled in any way and need accommodation to participate in the Board meeting, please call the Clerk of the Board at (858) 522-6614 for assistance at least three (3) working days prior to the meeting so the necessary arrangements can be made.
11. RULES GOVERNING MEETINGS: The Water Authority’s Administrative Code Chapter 2.00 governs conduct of meetings of the Board and the Committees. The Administrative Code is available on line at www.sdcwa.org or at the Water Authority Headquarters.
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MEETING SCHEDULE
APRIL 25, 2019
MORNING SESSION 9:00 a.m. to 11:45 p.m. Engineering & Operations Committee Estimated meeting time: 9:00 – 9:50 a.m. Legislation & Public Outreach Committee Estimated meeting time: 9:55 – 10:30 a.m. Administrative & Finance Committee Estimated meeting time: 10:35 – 11:45 a.m.
LUNCHEON FOR DIRECTORS 11:45 a.m. to 12:45 p.m.
AFTERNOON SESSION 12:45 p.m. to 2:45 p.m. Imported Water Committee Estimated meeting time: 12:45 – 1:30 p.m. Water Planning & Environmental Committee Estimated meeting time: 1:35 – 2:45 p.m.
FORMAL BOARD MEETING 2:45 p.m.
* Time estimates are for convenience only and do not constitute part of the schedule. The first morning session will commence at 9:00 a.m., and the following morning sessions may start at any time after 9:00 a.m. The first afternoon session may commence at the conclusion of the morning session and earlier than 12:45 p.m., and the other afternoon sessions may start at any time after 12:45 p.m. The Board meeting will start no earlier than 2:45 p.m., and will follow the conclusion of the last committee meeting.
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ENGINEERING AND OPERATIONS COMMITTEE
AGENDA FOR
APRIL 25, 2019
Marty Miller – Chair Jim Murtland Lois Fong-Sakai – Vice Chair Jose Preciado Ron Watkins – Vice Chair Joel Scalzitti Gary Arant John Simpson Jack Bebee Tim Smith Kathleen Coates Hedberg Fern Steiner Tony Heinrichs Almis Udrys Joe Mosca
1. Roll call – Determination of quorum.
2. Additions to Agenda (Government Code Section 54954.2(b)).
3. Public Comment – opportunities for members of the public to address the Committee on matters within the Committee’s jurisdiction.
4. Chair’s Report. 4-A Directors’ comments.
I. CONSENT CALENDAR
II. ACTION/DISCUSSION/PRESENTATION
1. Escondido Facility Space Needs Subcommittee update. Marty Miller (Presentation)
2. History of Asset Management and Use of Technology and Tools. Nathan Faber (Presentation)
3. Update on Water Quality Conditions. (Presentation) Jim Fisher
III. INFORMATION
IV. CLOSED SESSION
V. ADJOURNMENT Melinda Nelson, Clerk of the Board NOTE: This meeting is called as an Engineering & Operations Committee meeting. Because a quorum of the Board may be present, the meeting is also noticed as a Board meeting. Members of the Board who are not members of the Committee may participate in the meeting pursuant to Section 2.00.060(g) of the Authority Administrative Code (Recodified). All items on the agenda, including information items, may be deliberated and become subject to action. All public documents provided to the committee or Board for this meeting including materials related to an item on this agenda and submitted to the Board of Directors within 72 hours prior to this meeting may be reviewed at the San Diego County Water Authority headquarters located at 4677 Overland Avenue, San Diego, CA 92123 at the reception desk during normal business hours.
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April 17, 2019
Attention: Engineering and Operations Committee
Escondido Facility Space Needs Subcommittee update. (Presentation)
Purpose This informational item provides an update on the work and conclusions of the Escondido Facility Space Needs Subcommittee.
Discussion The Water Authority’s Operations and Maintenance Department (O&M) has a centralized 2.7 acre operations center yard located in the city of Escondido. In addition, O&M maintains an adjacent 0.34 acre leased storage area. Primarily from these facilities, O&M operates and maintains the large, expansive, and complex water supply and aqueduct system.
In October 2018, O&M issued a consultant contract to The Miller Hull Partnership, LLP (Miller Hull) to perform a space needs study to assess the adequacy of O&M’s current facilities in meeting current and future operational and maintenance requirements. In January 2019, Chair Madaffer created the Escondido Space Needs Subcommittee to review and report back on the space needs study results and O&M’s needs. On March 6, 2019, Miller Hull presented the space needs study results to the Subcommittee and the Subcommittee toured O&M’s Escondido Facility. On March 25, 2019, a follow-up meeting between O&M staff and the Subcommittee was held to discuss final questions and the Subcommittee’s decision on the adequacy of O&M’s current facilities and current/future space needs.
This presentation will provide background information of O&M’s Escondido Operations Center Facilities, the results of the consultant’s space needs study, and a report out by the Subcommittee.
For any interested members of the board who would like to see the Escondido Operations Center, we have two site tours scheduled; Wednesday, May 1, 2019, 10:30 a.m. - 12:00 p.m. and Monday, May 13, 2019, 1:00 p.m. - 2:30 p.m. If you are interested in attending one of the tours, please contact Maria Rose ([email protected]) to reserve your spot.
Prepared by: Jesus M. Meda, Operations and Maintenance Manager Reviewed by: Sandra L. Kerl, Acting General Manager Approved by: Marty Miller, Chair, Engineering and Operations Committee
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April 17, 2019
Attention: Engineering and Operations Committee
History of Asset Management and Use of Technology and Tools. (Presentation)
Purpose This presentation provides an overview of the history of the Water Authority’s asset management program and the use of technology and tools.
Discussion The Water Authority’s Asset Management Program is a system of proactive inspections, prioritized rehabilitation needs based on risk, and recommended infrastructure rehabilitation projects. The program helps to prevent failures and provide our Member Agencies with reliable and cost-effective service.
This presentation will cover why risk management of infrastructure is important, the history of pipeline failures, technology and tools the Water Authority is using to pinpoint potential infrastructure failures, how technology is providing better decision-making information, and how the Water Authority is leveraging these technologies to do more with less resources.
Prepared by: Nathan Faber, Operations and Maintenance Manager Reviewed by: James E. Fisher, Director of Operations and Maintenance Approved by: Sandra L. Kerl, Acting General Manager
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April 17, 2019
Attention: Engineering and Operations Committee
Update on Water Quality Conditions. (Presentation)
Purpose This presentation provides an update on the Water Authority’s actions to maintain water quality within the treated water system.
Discussion The Water Authority delivers both treated and untreated water to our member agencies. All water delivered must comply with federal and state regulations, and allow our member agencies to meet federal and state regulations within their systems. As a result of reduced regional demands and increased State Water Project blends, the Water Authority has had to actively manage water quality throughout the water system.
This presentation will provide an overview of the current water quality conditions and actions being taken by the Water Authority, in coordination with our member agencies and MWD, to maintain high quality water within the water system.
Prepared by: James E. Fisher, Director of Operations and Maintenance Approved by: Sandra L. Kerl, Acting General Manager
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LEGISLATION AND PUBLIC OUTREACH COMMITTEE
AGENDA FOR
APRIL 25, 2019
Jerry Butkiewicz – Chair Tom Kennedy Matt Hall – Vice Chair Barry Leonard Mel Katz – Vice Chair Jim Madaffer David Cherashore John Masson Gary Croucher Marty Miller Jim Desmond Joe Mosca Christy Guerin Fern Steiner Frank Hilliker
1. Roll call – determination of quorum.
2. Additions to agenda (Government Code Section 54954.2(b)).
3. Public comment – opportunities for members of the public to address the Committee on matters within the Committee’s jurisdiction.
4. Chair’s report. 4-A Directors’ comments.
I. CONSENT CALENDAR
1. Adopt positions on various state bills: Glenn Farrel Staff recommendation:
1-A Adopt a position of Oppose Unless Amended on AB 217 (Garcia), relating to safe drinking water.
1-B Adopt a position of Support on AB 868 (Bigelow), relating to energy system deenergization protocols.
1-C Adopt a position of Support on AB 1180 (Friedman), relating to recycled water.
1-D Adopt a position of Support on SB 134 (Hertzberg), relating to water system loss enforcement.
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1-E Adopt a position of Support on SB 487 (Caballero), relating to aerial snow surveys.
1-F Adopt a position of Support on SB 785 (Senate Committee on Natural Resources and Water), relating to exchange of property. (Action)
II. ACTION/DISCUSSION/PRESENTATION
1. Legislative issues. 1-A Washington report by Ken Carpi. (In person report) (Supplemental Materials)
1-B Sacramento Report Glenn Farrel
2. Update on Brought to You by Water activities. (Presentation) Mike Lee
III. INFORMATION
1. Quarterly report on Public Outreach and Conservation activities. Denise Vedder
2. Government Relations Update. Glenn Farrel
IV. CLOSED SESSION
V. ADJOURNMENT Melinda Nelson Clerk of the Board
NOTE: This meeting is called as a Legislation and Public Outreach Committee meeting. Because a quorum of the Board may be present, the meeting is also noticed as a Board meeting. Members of the Board who are not members of the Committee may participate in the meeting pursuant to Section 2.00.060(g) of the Authority Administrative Code (Recodified). All items on the agenda, including information items, may be deliberated and become subject to action. All public documents provided to the committee or Board for this meeting including materials related to an item on this agenda and submitted to the Board of Directors within 72 hours prior to this meeting may be reviewed at the San Diego County Water Authority headquarters located at 4677 Overland Avenue, San Diego, CA 92123 at the reception desk during normal business hours.
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April 17, 2019
Attention: Legislation and Public Outreach Committee
Adopt positions on various state bills. (Action)
Staff recommendation • Adopt a position of Oppose Unless Amended on AB 217 (Garcia), relating to safe drinking water. • Adopt a position of Support on AB 868 (Bigelow), relating to energy system deenergization protocols. • Adopt a position of Support on AB 1180 (Friedman), relating to recycled water. • Adopt a position of Support on SB 134 (Hertzberg), relating to water system loss enforcement. • Adopt a position of Support on SB 487 (Caballero), relating to aerial snow surveys. • Adopt a position of Support on SB 785 (Senate Committee on Natural Resources and Water), relating to exchange of property.
Alternatives 1. Do not adopt one or more of the recommended positions. 2. Modify one or more of the recommended positions.
Fiscal Impact There is no direct fiscal impact associated with the consideration of adopting policy positions on legislation.
Executive Summary • This proposed action is to allow the Board to consider adopting positions on state legislation. • The legislation identified in this report would have some material effect on the Water Authority or its member agencies, or would advance an important interest. • The recommended positions on legislation are based on an analysis of each bill with the Board’s adopted 2019 Legislative Policy Guidelines. • Water Authority staff and legislative advocates will advance the Board’s policy positions during the current legislative session.
Discussion
AB 217 (Garcia) – Safe Drinking Water For All Act Existing law, the California Safe Drinking Water Act, requires the State Water Resources Control Board (SWRCB) to administer provisions relating to the regulation of drinking water to protect public health. Existing law declares it to be the established policy of the state that every
Page 11 of 146 Legislation and Public Outreach Committee April 17, 2019 Page 2 of 14 human being has the right to safe, clean, affordable, and accessible water adequate for human consumption, cooking, and sanitary purposes.
AB 217, as amended on March 28, 2019, would enact the Safe Drinking Water for All Act and would establish the Safe and Affordable Drinking Water Fund in the State Treasury. AB 217 would:
• Establish the safe and affordable drinking water fee of $0.50 per service connection, per month. The revenue from this charge would be required to be remitted by the public water system annually by July 1.
• Establish the safe drinking water fee for nondairy confined animal facilities of $1,000 for the first facility owned by a single person, and $750 per each facility thereafter (to a maximum of $12,000 per year).
• Establish the fertilizer safe drinking water fee of six mills ($0.006) per dollar of sales for all sales of fertilizing material.
• Establish the dairy safe drinking water fee of $0.01355 per hundredweight of milk from payments made to producers for milk.
• Create the Safe and Affordable Drinking Water Trust Fund and transfer $200 million annually for five years from the state general fund to the Trust Fund for the purposes of establishing a $1 billion Trust Fund to derive interest revenues for the safe and affordable drinking water program.
• Create the Safe and Affordable Drinking Water Fund to be administered as the state’s safe drinking water program by the State Water Resources Control Board (SWRCB).
o AB 217 would authorize the SWRCB to expend funds for grants, loans, contracts, or services to assist eligible applicants with: . Provision of replacement water as a short-term solution . Development, implementation, and sustainability of long-term solutions (construction is identified as an authorized expenditure) . Identification of Californians eligible to receive assistance and outreach to them . Testing of drinking water quality of domestic wells serving low-income households . Provision of administrative and managerial services
o AB 217 would require the SWRCB to prioritize (not limit) the use of the Fund to: . Assist disadvantaged communities and low-income households served by a state small water system or domestic well
. Fund costs other than those related to capital construction costs, except for
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capital construction costs associated with consolidation and service extension to reduce the ongoing unit cost of service to increase sustainability of drinking water infrastructure and service delivery
Nearly 800,000 people in California lack access to safe and reliable drinking water on a daily basis. The SWRCB has identified 329 systems statewide that chronically serve contaminated drinking water or cannot provide reliable water service due to unsound infrastructure or because they lack the local financial, managerial, and technical resources to do so. The vast majority of these systems are small, rural systems that typically serve fewer than 10,000 people. A sustainable solution is necessary to address this significant public health crisis.
In California, there are approximately 9,000 water systems that are regulated by the state or the county (those with four or more service connections). In addition, there are an unknown number of individual domestic wells and water systems serving fewer than four service connections. Of the 9,000 regulated water systems, there were 459 larger systems (those with 15 or more service connections) that were out of compliance in the past year because they incurred at least one water quality violation in the prior 12 months. These affected systems served almost 600,000 Californians. Two of the most commonly detected pollutants in contaminated water are arsenic and nitrates. High concentrations of nitrates in groundwater are primarily caused by human activities, including fertilizer application, animal operations such as dairies, industrial sources (wastewater treatment and food processing facilities), and septic systems.
Many sources of available funding to address safe drinking water issues today – including state general obligation bonds and the Drinking Water State Revolving Fund – require water systems to demonstrate the ability to generate sufficient revenue to perform operations and maintenance (O&M) on new capital infrastructure, as well as repay any loans. Some water systems – often those in disadvantaged communities – are unable to demonstrate the ability to generate sufficient revenue to perform O&M on new capital infrastructure. The challenge in these systems is often a product of a combination of factors, including the high costs of the investments required, low income of the customers, and the small number of customers across whom the costs would need to be spread.
The complexity of the problems facing these small drinking water systems in communities throughout the state argues for a much more comprehensive solution than is presented in any of the individual legislative proposals that have been introduced to-date. While funding is needed to address operations and maintenance needs for many of the affected drinking water systems, there is also a need for structural reforms to address service-delivery deficiencies and attack some of the root causes of these persistent water quality problems. AB 217 presents a proposal that is most closely aligned with the Water Authority Board’s policy direction from its March 25 Board meeting to advocate for a comprehensive, linked solution to California’s persistent safe drinking water issues.
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Creation of Safe Drinking Water Trust Fund – SB 669 and AB 217
Funding contribution $1B through Comprehensive appropriation agricultural administrative from budget safe drinking structure within surplus funds – water fees + SWRCB – SB 200 SB 669 and AB safe harbor – and AB 217 217 Admin BTB
Structural and service delivery reforms – SB 414
In terms of the Safe and Affordable Drinking Water Trust provisions of AB 217, if the funds are invested in a reasonable and prudent manner, along the lines of the investment guidelines established for other public investments, such as the Public Employees’ Retirement System or the Local Agency Investment Fund, it is estimated that a $1 billion investment in the Trust Fund would sustainably generate approximately $50-$70 million annually for the operations and maintenance needs of small water systems within disadvantaged communities. This investment revenue, coupled with the revenue produced by charges on production agricultural activities – fertilizer, confined animal feeding lots, and milk production – is estimated to realize approximately $100-$110 million annually for operations and maintenance funding needs.
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There is broad agreement among various stakeholders with the objective of addressing safe drinking water needs throughout California. There is also acknowledgment that the lack of access to safe drinking water in certain disadvantaged communities is a public health issue and a social issue that the State needs to address. There are several provisions of AB 217 that should be amended to resolve outstanding issues and concerns:
• AB 217 should be amended to remove the safe and affordable drinking water fee. Sustainable funding can be achieved through implementation of the Safe and Affordable Drinking Water Trust and production agricultural tax mechanisms.
• AB 217 should be amended to include the production agricultural regulatory relief provisions embodied within the Administration’s budget trailer bill.
• AB 217 should not allow capital costs to be an eligible funding category, and the measure should be narrowly focused only on funding operations and maintenance costs that are difficult to fund through general obligation bond measures and cannot be funded through state revolving loan fund programs.
• AB 217 should exclude “state small water systems” and “domestic wells” as eligible funding categories. Data is lacking to support a credible needs assessment for these smallest systems (less than four service connections) and private wells. The state does not require owners of private wells to routinely undertake water quality testing and consequently a comprehensive database for these wells does not exist. The California Urban Water Agencies’ analysis of safe drinking water issues in the state supports the need to continue developing data on the universe of state small water systems and domestic wells with compromised drinking water quality.
• AB 217 should be statutorily linked to enactment of SB 669, SB 200, SB 414, and components of the budget trailer bill. The issues and proposed solutions presented in these four measures are inextricably linked, and only with contingent enactment of all four measures – to ensure robust funding through the Safe Drinking Water Trust Fund, financial contribution to the remedies from the production agricultural industry, and structural solutions – will a complete package to address safe drinking water in California be achieved.
The Water Authority’s legislative policy guidelines state that the Water Authority shall oppose initiatives that:
• Imposes a water user fee on water agencies or water users that does not provide a commensurate and directly linked benefit in the local area or region from which the water user fee is collected.
• Imposes a water user fee for statewide projects or programs, for which the projects or programs are not clearly defined, the beneficiaries identified, and the reasonable costs
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identified.
• Imposes a water user fee to create a state fund that can be used to finance undefined future projects and programs.
• Imposes a “public goods charge” or “water tax” on public water agencies or their ratepayers.
(2019 Legislative Policy Guidelines, Fiscal Policy and Water Rates: Fees, Taxes, and Charges – Oppose, Pages 20-21, Items 4, 5, 6, and 9).
Staff recommends a position of Oppose Unless Amended on AB 217.
Suggested Amendments: AB 217 should be amended as described above.
AB 868 (Bigelow) – Electrical Corporation, Electrical Cooperatives, Local Publicly Owned Electric Utilities: Wildfire Mitigation Plans Under existing law, the California Public Utilities Commission (CPUC) has regulatory authority over public utilities, including electrical corporations, while local publicly owned electric utilities are under the direction of their governing boards. Existing law requires each electrical corporation, local publicly owned electric utility, and electrical cooperative to construct, maintain, and operate its electrical lines and equipment in a manner that will minimize the risk of catastrophic wildfire posed by those electrical lines and equipment, and requires that a wildfire mitigation plan prepared by each of those entities include protocols for disabling reclosers and deenergizing portions of the electrical distribution system and mitigating public safety impacts. Existing law requires that the deenergizing procedures contained in a mitigation plan consider the need to notify – as a priority – critical first responders, health care facilities, and operators of telecommunications infrastructure.
AB 868, as amended on March 25, 2019, would require each electrical corporation, local publicly owned electric utility, and electrical cooperative that deenergizes portions of the electrical grid as a wildfire mitigation measure to adopt protocols:
• Related to specifying when the deenergization will be undertaken • For providing notice and other steps to be taken to minimize any adverse effect from deenergization • For restoring electrical service following a deenergization
AB 868 would also require that in developing the protocols, the utilities shall consult with persons and institutions that are reasonably likely to be affected by a deenergization, including local schools, water suppliers, wastewater agencies, disability rights advocates, consumer groups, fire departments, law enforcement agencies, local government officials, local elected officials, hospitals, and communications providers. In addition, AB 868 would require a utility
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that deenergizes portions of the electrical grid as a wildfire mitigation measure to maintain an internet website or dedicated web page that is devoted to public safety as it relates to the utility services provided by the utility.
California is experiencing an increase in wildfire events due to a number of factors, including an extended period of drought, increased fuel available for fires, and unprecedented climatological conditions that are leading to extreme weather events. Exacerbating wildfire conditions are energized power lines and the potential of these lines to either spark or worsen an existing wildfire. To mitigate these and other risks, the CPUC has authorized the investor-owned utilities to use the option of proactively shutting down power to specific power lines to limit the impact or damage of those lines within communities where the utilities are aware of dangerous conditions. Deenergization of distribution lines under certain circumstances is now expected of all electric utilities in the state.
In a 2012 decision by the CPUC, San Diego Gas & Electric was authorized to engage in proactive deenergization actions, which allowed the utility to shut off power as a fire prevention measure against severe Santa Ana winds. In July 2018, the CPUC extended the deenergization notice, reporting, and reasonable review requirements to all electric utilities and adopted additional measures to supplement its findings in the 2012 decision. The new measures included more detailed reporting and additional public outreach, notification, and mitigation.
The investor-owned utilities have now declared numerous deenergization events in recent months and the CPUC has received a large volume of input from the public, government agencies, and other first responders concerned about the practice. Consequently, the CPUC opened a proceeding in December 2018 to examine how the deenergization process is working and to determine whether additional refinement is appropriate.
AB 868 is a focused effort – led by water agencies within many of the wildfire-ravaged communities – to implement public safety power shutoff protocols that have been proven effective in previous instances where public safety power shutoffs have been employed to mitigate wildfire risks. During some wildfire events, there has been anecdotal evidence of inconsistent communications from and with the power utilities involving municipalities, local governments, public safety agencies, and customers. Increased communication and timely notification before and during a deenergization event would allow local governments – including water suppliers and wastewater treatment agencies – customers, and vulnerable communities to plan appropriately.
The Water Authority’s legislative policy guidelines state that the Water Authority shall support initiatives that:
• Improve the Water Authority’s and its member agencies’ efforts to maintain and protect its property, rights of way, easements, pipelines, and related facilities and minimizes liability to the Water Authority.
(2019 Legislative Policy Guidelines, Right of Way and Property – Support, Page 41, Item 1).
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Staff recommends a position of Support on AB 868.
AB 1180 (Friedman) – Water: Recycled Water Existing law, the California Safe Drinking Water Act, requires the State Water Resources Control Board (SWRCB) to administer provisions relating to the regulation of drinking water to protect public health. Existing law also requires, on or before January 1, 2020, the SWRCB to adopt standards for backflow protection and cross-connection control through the adoption of a policy handbook. Additionally, existing law requires the state board to establish uniform statewide recycling criteria for each varying type of use of recycled water where the use involves the protection of public health.
AB 1180, as amended on March 28, 2019, would require that handbook to include provisions for the use of a swivel or changeover device to supply potable water to a dual-plumbed system during an interruption in recycled water service. AB 1180 would also require the SWRCB, by January 1, 2023, to update the uniform statewide criteria for nonpotable recycled water uses.
The California Code of Regulations, Title 22 regulates the use of recycled water in California. The regulations for California’s vast network of purple pipes, which provide recycled water for nonpotable uses in every county in the state, have not been updated for 19 years. AB 1180 would provide an update to these regulations, incorporating the knowledge and lessons learned from nearly two decades of nonpotable water recycling, and would help the state to achieve its ambitious goals for recycled water use. Some of the types of regulatory updates that are necessary include:
• Revising “outdoor eating area” restrictions to clarify that recycled water can be used in parks with picnic tables, etc.
• Revising dual plumbing requirements so food processing or beverage facilities (such as breweries or wineries) or buildings with cafeterias can have their restrooms dual plumbed, with continued prohibition on use in the food processing area.
• Adding additional allowable recycled water uses such as for ponds, vehicle washing, pressure testing, and approved fill stations.
AB 1180, which is sponsored by WateReuse California, would also promote recycled water for dual-plumbed buildings and commercial, industrial, and institutional uses by specifically allowing for a changeover device, or “swivel ell,” so that building owners can easily switch back and forth between potable and nonpotable water when required for testing or other recycled water shutdowns. The ability to easily and cost-effectively make the switch to potable water would eliminate a barrier for building owners to bring recycled water used for landscape irrigation inside their buildings. Currently, the California Code of Regulations requires an air gap assembly for this purpose, which is costly and generally impractical for use in a building.
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The Water Authority and its member agencies have made a commitment to becoming more regionally self-reliant and less dependent on the Bay-Delta by developing local water supplies that are drought-proof and sustainable. In 2018, 37,600 acre-feet of recycled water was beneficially reused within the Water Authority’s service area. By 2040, the region expects to produce 46,858 acre-feet per year of recycled water through existing and planned recycled water projects.
The Water Authority’s legislative policy guidelines state that the Water Authority shall support initiatives that:
• Encourage dual plumbing in new development where non-potable recycled water is likely to be available to enable utilization of recycled water.
• Encourage the use of recycled water in commercial, industrial, institutional, and residential settings.
(2019 Legislative Policy Guidelines, Local Water Resources: Water Recycling & Potable Reuse —Support, Page 38, Items 4 and 5).
Staff recommends a position of Support on AB 1180.
SB 134 (Hertzberg) – Water Conservation: Water Loss Performance Standards: Enforcement Existing law requires each urban retail water supplier to calculate an urban water use objective by November 1, 2023, and by November 1 every year thereafter. The law requires the urban water use objective be composed of the sum of certain water use estimates, including aggregate estimated water system losses. Existing law also authorizes the State Water Resources Control Board (SWRCB) to issue information orders, written notices, and conservation orders to an urban retail water supplier that does not meet its urban water use objective and authorizes the SWRCB to impose civil liability for a violation of an order or regulation issued pursuant to those provisions. Additionally, the law requires the SWRCB to adopt rules requiring urban retail water suppliers to meet performance standards for the volume of water losses between January 1, 2019 and July 1, 2020.
SB 134 would prohibit the SWRCB from imposing liability for a violation of the performance standards for the volume of water losses except as part of the enforcement of an urban water use objective.
In 2018, the State Legislature enacted two policy bills, SB 606 (Hertzberg) and AB 1668 (Friedman), to modify statutes for imposing and implementing long-term water use efficiency standards. SB 606 and AB 1668 were direct outcomes of an April 2017 report released by former Governor Brown’s Administration entitled, “Making Conservation a California Way of Life.”
SB 134 is a follow-up measure to SB 606, which required the SWRCB and Department of Water Resources to adopt water efficiency regulations, outlined requirements for urban water suppliers,
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and specified penalties for violations. SB 606 also required annual calculation and reporting of urban water use objectives which is a combination of indoor standards, outdoor standards, commercial, industrial, and institutional performance measures, and water loss performance standards.
During the development of SB 606, a conflict was identified between the water loss performance standards in the bill language and the existing enforcement authority of the SWRCB to issue penalties under the statutory provisions of existing law – SB 555 (Wolk). The intent, under SB 606, was that urban retail water suppliers would have the flexibility to choose how they achieve the urban water use objectives. For example, reductions in outdoor residential use may be more cost effective than replacing leaking distribution mains. However, SB 555, as a standalone statute, grants the SWRCB the authority to enforce the water loss performance standards outside of the context of the long-term water use efficiency statutes. In effect, this conflict removes the flexibility intended under SB 606 and requires that water agencies meet their urban water use objectives within the context of the long-term water use efficiency statutes and the water loss performance standards enacted pursuant to SB 555 that the SWRCB expects to adopt in 2020.
SB 134, sponsored by the California Municipal Utilities Association, would clarify that the SWRCB will administer a cumulative water loss performance standard to ensure that the volume of water loss is not enforced separately from the provisions of SB 606. A key part of the discussion during the development of SB 606 and AB 1668 was the inclusion of volumetric water loss reductions in the overall urban water use objective, particularly because SB 555 (Wolk) already included a regulatory path for the development of water loss performance standards. In the final legislation, water loss was included but there were concerns even at the time that, in addition to being a flexible element in the objective, the volumetric water loss standard could be enforced as a stand-alone target. This double-jeopardy enforcement does not occur with any of the other elements that are included in the objective (e.g., 55 GPCD for indoor use) and is contrary to the spirit of the conservation legislation.
Water use efficiency is a core element of the San Diego County Water Authority’s long-term strategy to improve the reliability of the region’s water supply by diversifying our supply sources. Since 1991, the Water Authority’s water-use efficiency programs and initiatives cumulatively have conserved more than 1 million acre-feet of water. These savings have been achieved through measures that include incentives on water-efficient devices, legislative efforts, and outreach campaigns and programs. The region is on track to meet the state’s mandate to reduce per capita water use 20 percent by 2020.
The Water Authority’s legislative policy guidelines state that the Water Authority shall support initiatives that:
• Recognize local control in determining how to meet an overall efficient water use goal, based on the combined efficient indoor use, outdoor use, and leak loss, as established under the criteria provided for in statute.
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(2019 Legislative Policy Guidelines, Water Use Efficiency: Long-Term Water Use Efficiency — Support, Page 62, Item 2).
Staff recommends a position of Support on SB 134.
SB 487 (Caballero) – Department of Water Resources: Aerial Snow Survey Existing law requires the Department of Water Resources (DWR) to gather and correlate information and data pertinent to an annual forecast of the state’s seasonal water picture, including undertaking routine snow surveys. Existing law also requires DWR to update every five years the plan for the orderly and coordinated control, protection, conservation, development, and use of the water resources of the state, which is known as The California Water Plan.
SB 487 would require DWR’s California snow survey program to conduct aerial surveys of the snowpack in the Trinity Alps and Sierra Nevada Mountains, including hydrologic areas that drain or supply water to the following major reservoirs and lakes:
• Don Pedro Reservoir • Englebright Lake • Folsom Lake • Lake Isabella • Lake Kaweah • Lake McClure • Lake Oroville • Lake Success • Lake Tahoe • Millerton Lake • New Melones Lake • Owens Lake • Pardee Reservoir • Pine Flat Reservoir • Shasta Lake • Trinity Lake
SB 487 would also require DWR to collect the aerial survey data up to 10 times per year in each hydrologic area and to summarize and make publicly available the data obtained and digital products used to produce runoff forecasts. SB 487 would continuously appropriate $150 million from the General Fund to DWR for these purposes with $15 million being allocated for expenditure each fiscal year, and would sunset these provisions as of January 1, 2030.
Since 2013, a group of local and regional water agencies relying on the Sierra Nevada watershed for their water supply have collaborated to fund Airborne Snow Observatory (ASO) surveys
Page 21 of 146 Legislation and Public Outreach Committee April 17, 2019 Page 12 of 14 developed by the National Aeronautics and Space Administration’s Jet Propulsion Laboratory, in the upper watersheds of the Tuolumne, Merced, San Joaquin, Lakes, Kings, and Kaweah basins. Instead of examining the snowpack through widely scattered measurement points, ASO is able to provide a watershed-wide snapshot through plane-mounted technology to measure snow depth and density along every square meter in a watershed, providing runoff forecasts that have shown to be between 96 percent and 98 percent accurate.
The data gathered from these surveys helps determine how much water is stored in the snowpack, informing local and regional agencies when and where runoff will be available, as well as when and how much water will be released from reservoirs that are managed for flood control. Working with inaccurate data may result in unnecessary water releases and increased flood risk.
Currently, the Water Authority and its member agencies have 24 major reservoirs within the San Diego region that store imported water and/or local runoff water for normal use, emergency conditions, and imported water shortages. These local reservoirs not only provide water supply storage benefits, but also provide important regional flood prevention benefits. A better understanding of the snowpack through technology could potentially inform the Water Authority and its member agencies of new reservoir operations opportunities to improve water capture and flood protection in the San Diego region.
The Water Authority’s legislative policy guidelines state that the Water Authority shall support initiatives that:
• Incorporate state provided climate change information into statewide, regional, and local water management planning, and provides funding for projects that assist in adapting to effects of climate change on the state’s water supply.
(2019 Legislative Policy Guidelines, Climate Change: Funding—Support, Page 50, Item 1).
Staff recommends a position of Support on SB 487.
SB 785 (Committee on Natural Resources and Water) – Public Resources: Parklands, Freshwater Resources, and Coastal Resources The California Clean Water, Clean Air, Safe Neighborhood Parks, and Coastal Protection Act of 2002, among other things, authorized the issuance of grants to local governments from the sale of bonds for the acquisition, development, restoration, and enhancement of local parks.
SB 785 would authorize the County of San Diego to transfer a specific parcel of park property, acquired with those bond funds, to the Water Authority, and would authorize the County of San Diego to accept a transfer of a different parcel from the California Department of Transportation (CalTrans) if the County of San Diego signs an agreement with the Department of Parks and Recreation that ensures the parcel transferred to the County is maintained and operated in perpetuity for park purposes.
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SB 785 is the Senate Natural Resources and Water Committee’s annual omnibus legislation. Many policy committees within the Legislature introduce an omnibus bill that includes a variety of non-controversial provisions of statute that are better suited for a “package” approach to advancing through the legislative process rather than as a series of individual policy bills. The policy committees undertake these annual omnibus bills as a means of reducing costs associated with negotiating an individual policy bill through the Legislature. Provisions included within omnibus bills are subjected to extensive vetting and review by stakeholder interests, legislative staff, and Administration staff and officials to ensure that the provisions are truly non- controversial in nature and suitable for inclusion in the omnibus bill. If a provision raises concerns or objections, it is removed from the omnibus bill unless and until all concern or objection is addressed and removed.
In 2009, San Diego County received grant funds from the California Department of Parks and Recreation to purchase a 69-acre property for an active parks site in the San Luis Rey River Valley. As the County got closer to park development activities, it became clear that 2.11 acres of the property could not be developed and would be detached from the remaining 67 acres because the acreage was north of San Luis Rey River. At approximately the same time, the County learned of an adjacent 2.11 acres owned by CalTrans that was available, not needed for transportation purposes, and could be developed as part of the park. In addition, CalTrans had conceptually agreed to an exchange of approximately 2.11 acres of land with the Water Authority for the CalTrans’ State Route 76 highway improvements across the Water Authority’s property.
The 2.11 acres of CalTrans property had been set aside for CalTrans to provide to the Water Authority for mitigation and replacement land for the Water Authority’s property that had been used by CalTrans for the already-constructed State Route 76 improvements. SB 785 would effectuate a three-way property exchange, as follows:
• San Diego County would provide 2.11 acres to the Water Authority for its mitigation and restoration programs
• CalTrans would provide 2.11 acres to San Diego County after obtaining approval of the California Transportation Commission o CalTrans is a party to this exchange because it owes the Water Authority compensation for receiving a similar-sized property for the construction of the State Route 76 highway improvement project
The Water Authority’s legislative policy guidelines state that the Water Authority shall support initiatives that:
• Improve the Water Authority’s and its member agencies’ efforts to maintain and protect its property, rights of way, easements, pipelines, and related facilities and minimizes liability to the Water Authority.
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(2019 Legislative Policy Guidelines, Right of Way and Property – Support, Page 41, Item 1).
Staff recommends a position of Support on SB 785.
Prepared by: Ivy Ridderbusch, Management Analyst Glenn Farrel, Government Relations Manager Approved by: Dennis A. Cushman, Assistant General Manager
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April 17, 2019
Attention: Legislation and Public Outreach Committee
Update on Brought to You by Water activities (Presentation)
Purpose This presentation will update the Board on recent activity in the Brought to You by Water outreach and education program and provide a preview of upcoming activities.
Background The Water Authority’s Brought to You by Water outreach and education program is moving into its fourth quarter, following the completion of a successful third quarter focused on brewing. The next focal industry is agriculture. The Water Authority is working with the San Diego County Farm Bureau and member agencies to highlight the significance of the region’s $4.8 billion farm industry and its connection with maintaining the region’s safe and reliable water supplies.
The Water Authority is planning to participate in several events and activities, including sponsorship of Graze at the Flower Fields, the Farm Bureau’s first farm-to-table event highlighting local agricultural offerings. Additional partnerships and events are planned in coordination with member agencies at local farmer’s markets and grocery stores. An earned and paid media program will support outreach efforts, including a series of television advertisements that will air on KFMB- TV (CBS News 8) during the news broadcasts from April 29 to June 15. This advertising schedule complements the digital and social media campaign to ensure coverage among key audiences.
Beginning June 17, the Water Authority will launch its “Summer of Social Influence.” Jon Foreman, lead singer of the local band Switchfoot, is featured in a series of videos designed to draw in new audiences to learn how water is used in San Diego County. The videos will be featured in a six-month social media program. Also, to leverage program impact, the Water Authority has agreed to sponsor water stations at the Bro-Am, the popular surf and music event produced by, and featuring Switchfoot on June 29.
In January 2019, the Board of Directors approved the continuation of the Brought to You by Water program to communicate the value of water to the region’s economy and quality of life. The first year of the program focused on four key sectors of the economy: Tourism, manufacturing, brewing and agriculture. Staff is preparing to feature additional water-dependent industries such as life sciences, healthcare and defense in the coming months.
Prepared by: Mike Lee, Public Affairs Supervisor Reviewed by: Denise Vedder, Director of Public Outreach and Conservation Approved by: Dennis A. Cushman, Assistant General Manager
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April 17, 2019
Attention: Legislation and Public Outreach Committee
Quarterly report on Public Outreach and Conservation activities (Information)
Background From January through March 2019, the Public Outreach and Conservation Department supported Water Authority outreach programs and projects to promote the value of water and water-use efficiency, assisted member agencies with public outreach training, worked with communities directly affected by Water Authority construction projects, conducted media relations activities, developed an enhanced outreach and education program, and distributed information through various means, including publications and online communications.
Highlights of department activities during the quarter are listed below.
Local Legislative Relations and Civic Engagement
Staff held the 14th Citizens Water Academy class in March, with sessions at the Reuben H. Fleet Science Center in Balboa Park, the Water Authority’s Kearny Mesa Headquarters and the Water Authority’s Escondido Operations Center. Participants also toured the Claude “Bud” Lewis Carlsbad Desalination Plant and Olivenhain Dam. Upon returning to Escondido, 49 participants graduated, bringing the number of alumni to approximately 650.
Staff also held two Citizens Water Academy alumni events during this period – a tour of Cafe Moto in Barrio Logan on January 29, and a tour and networking event at Stone Brewing World Bistro & Gardens in Escondido on March 28. The Cafe Moto event allowed 21 alumni a sneak peek at the Brought to You by Water Brewing Month promotion and an opportunity to learn about Cafe Moto’s roasting and brewing operations. The Stone Brewing event was co-hosted with CWA alumna Rorie Johnston, CEO of the Escondido Chamber of Commerce. Approximately 30 alumni toured the facility and learned more about the brewery’s water conservation and recycling efforts as well as water quality impacts on brewing processes.
In addition, staff worked with Otay Water District to develop an education and outreach strategy for AB 1588, a bill sponsored by the two water agencies to ensure military veterans transitioning into civilian water and wastewater operator occupations receive appropriate crediting for experience and education gained during military service. The bill aims to assist transitioning veterans as well as water agencies help fill the potential gap within an aging workforce. The team has developed a fact sheet, presentation, sample support letter and talking points to secure letters of support for the proposed legislation. To date, the team has secured 11 letters and is working to obtain additional support from groups involved in veterans and workforce issues.
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On March 13, Director Hilliker and staff judged water-related projects at the Greater San Diego Science and Engineering Fair in Balboa Park. Winners in the junior and senior categories were identified and will be announced during the April board meeting.
Brought to You by Water Program In January, the Board declared February to be Brewing Month to showcase the region’s coffee and beer industry. Staff developed partnerships with local coffee shops and breweries to educate the public on the $1.1 billion impact brewing has on the regional economy. Staff also secured the participation of Cafe Moto to create a unique blend for the outreach. Board members and staff provided the selected blend, named Authority 1944, along with water-issue briefings to 28 business and community breakfast meetings throughout the region, reaching more than 1,000 civic and business leaders.
Those efforts also included a partnership with the San Diego Brewer’s Guild to reach approximately 127 local, independent breweries in the guild. Chair Madaffer and staff provided an update at the guild’s quarterly meeting in January, distributing 1,000 beer coasters for use at breweries countywide. In all, the Water Authority distributed 7,500 Brewing Month coasters.
In addition, staff developed a social media contest on Instagram that encouraged coffee and beer patrons to take a photo of their beverage and use a specialized hashtag entering them into a contest. Details of the campaign are provided under the social media section.
Community Outreach Events/Meetings Community Events attended by Board members 2 AB 1588 Briefings 3 Monthly Meetings – (Chambers, EDCs, Civic Orgs) 27 Events (State of the city, organization lunches, breakfasts, etc.) 31 1x1 Briefings (Elected staff, business orgs and staff, etc.) 6
Media Relations
The Water Authority distributed five news releases during the reporting period. The topics of these releases are listed in Exhibit 1. Throughout the period, staff also assisted media covering issues such as pipeline relining projects, Brought to You by Water outreach efforts, and water supply updates. Staff worked with KUSI to showcase Pipeline 5 upgrades and asset management efforts in Fallbrook for a nearly 2-minute piece that aired January 18 and coordinated responses to more than 15 inquiries about the local water supply conditions during the rainy season. Staff also worked with KUSI and Chair Madaffer on February 17 for an in-studio interview on the Bay-Delta, Brought to You by Water and other water issues.
Education Programs
The Water Authority’s K-12 education program reached 8,079 students and teachers this quarter as part of the long-running theater programs. More than 100 elementary and middle school teachers
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took a survey on the school performances in early March, and a majority gave the shows an “A” or “A+” grade.
The Water Authority’s application for Splash Lab funding via the Member Agency Administered Program Funding was approved by MWD. Approximately $75,000 will help to fund three Splash Lab visits in each member agency service area in the 2018-2019 and 2019-2020 school years. Staff is working with the San Diego County Office of Education to schedule these visits.
With the support of a $12,000 grant from the Hans and Margaret Doe Charitable Trust, the Water Authority developed and distributed educational posters that highlight the region’s water supply reliability investments and water-related careers. After months in development and review, the posters were printed in January. Staff worked with the San Diego County Office of Education to distribute posters to the region’s middle schools, high schools and community colleges in February and March. Per the grant agreement, the posters feature key pieces of infrastructure that provide safe and reliable water supplies to the San Diego region, along with information about key industries supported by those water supplies and career options in water-related fields. The posters, which credit the Doe Trust for funding, fill a gap in the Water Authority’s education program by providing content relevant to upper grades. The posters were shared with the Water Authority’s Board of Directors on Jan. 24 and with the member agency outreach representatives, some of whom are preparing to showcase the posters in their own offices. In addition, the posters have been mounted on foam core and taken to water industry events as part of the agency’s expanding outreach efforts to the next generation of workers.
Water-Use Efficiency Programs
WaterSmart Landscape Makeover Program During this reporting period, Design for Homeowners three-hour workshops were co-sponsored by Oceanside, Helix, San Dieguito, Olivenhain, San Diego and Carlsbad attracting a total of 202 participants for five events. Two four-class series were also held this quarter. These series were held in Escondido and Encinitas (at the San Diego Botanic Garden) and graduated 48 homeowner participants who committed to replacing more than 56,000 square feet of turf.
WaterSmart Checkup Program From January through March 2019, the WaterSmart Checkup Program provided more than 300 services. These services include residential indoor and outdoor surveys. Five member agencies implement the program locally, while all others rely on the Water Authority’s regional service provider, Mission Resource Conservation District.
Qualified Water Efficiency Landscaper (QWEL) Program During this reporting period, two QWEL class series and one class for Continuing Education Units have been completed with a total of 126 participants. Of these, 60 participants have successfully completed the QWEL examination and received QWEL certificates. Two English-language series were held at the City of Escondido and at the San Diego Botanic Garden.
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Sustainable Landscape Incentives / Turf Replacement Program During the reporting period, 111 regional participants in MWD’s Turf Replacement Program completed their projects, with cumulative incentive payments totaling more than $391,000, corresponding to nearly 136,000 square feet of former turf areas converted to sustainable landscapes. As it nears close-out, the locally-administered Sustainable Landscape Program issued 11 incentives this quarter totaling $27,802, corresponding to 16,027 square feet of former turf areas upgraded to sustainable landscaping standards.
Member Agency Administered Program (MAAP) The following MAAP programs were approved for funding during the reporting period:
MAAP Funding Requests Approved This Quarter (Jan-Mar 2019) Vallecitos WD Water Bottle Filling Education Station Fallbrook PUD Sustainability Demonstration Garden City of Oceanside Water Bottle Filling Stations for Elementary Schools Vallecitos WD Video Production Equipment
Publications and Online Communications
Water News Network The Water Authority posted nearly 20 original stories during the quarter on a wide variety of topics, from challenges created by the overheated U.S. construction market to high-tech tools the Water Authority has adopted for asset management to tips for using water efficiently at home. With increasingly robust original content on the Water News Network, the total page views for the site increased to more than 7,000 in March, an increase of approximately 37 percent from February. Staff continues to seek stories, photos and videos from member agencies with the goal of posting at least three original stories per week. Posted stories are repurposed for social media. In March, the Water Authority received notice that the 2018 Annual Report and the Water News Network would be honored at the annual conference of the California Association of Public Information Officials in April.
Social Media In January, staff deployed a series highlighting some of the agency’s innovative programs and projects, from drones to virtual reality goggles. In February, the Water Authority launched a large- scale Brewing Month Photo Contest and asked followers to share photos of their favorite local brews (coffee or beer) as part of the Brought to You by Water outreach and education program. The Water Authority also partnered with local chambers, member agencies and the brewing industry to boost participation. More than 200 photos were submitted for the contest on Instagram and Twitter, generating more than 1,700 likes, comments and shares. The contest also helped increase the Water Authority’s Instagram followers by nearly 8 percent, a major step forward.
During the reporting period, the Water Authority gained 635 followers across its core social media platforms (Facebook, Twitter, Instagram and LinkedIn), a 3.5 percent increase from the previous
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quarter (October to December 2018). On Facebook, the Water Authority has 9,180 followers; 4,493 followers on Twitter; 1,423 followers on Instagram and 3,116 followers on LinkedIn. Posts on social media generated 14,868 engagements (likes, shares and comments), a 6.7 percent increase from the previous quarter.
WaterSource E-Newsletter Staff distributed seven issues of the WaterSource e-newsletter, providing updates on key water- related issues to more than 7,288 subscribers. The content of the newsletters included items from the Water News Network and media coverage during the quarter.
Member Agency Outreach Coordination
The Water Authority hosted three Joint Public Information Council/Conservation Coordinators events during the quarter. Topics included Brought to by Water outreach and education program, water supply and regulatory updates, education posters, Colorado River issues, the Water Authority public opinion poll, conservation programs, and social media efforts such as the Brewing Month Photo Contest.
CIP Projects
Pipeline 5 Relining Project Staff attended project meetings and responded to inquiries from residents about nighttime work and road repair issues. Staff also developed a postcard and doorhanger to notify residents of street paving activities as construction nears completion.
La Mesa Sweetwater Extension Urgent Repair Staff coordinated with the homeowner on the property on completion of the project and received compliments from the homeowner on the professionalism of the onsite staff.
Northern First Aqueduct Structure and Liner Rehabilitation Project Staff mailed a project postcard to approximately 200 neighbors in The Trails neighborhood in Rancho Bernardo. The postcard identified the upcoming work schedule and contact information for project inquiries. The contractor installed a project sign near the Water Authority’s access road off Bernardo Trails Drive. Staff responded to inquiries from project neighbors about construction traffic and potential impacts.
Vallecitos 11/Vista Irrigation District 12 Flow Control Facility Rehabilitation Project Staff directed the outreach consultant on distribution of a project mailer detailing the beginning of work and staffing an information booth at the project site.
Mission Trails Flow Regulatory Structure II Project Staff made informational presentations to the Mission Trails Regional Park Citizens’ Advisory Committee and Task Force groups on January 8 and 17; the Tierrasanta Community Council on January 16; and the Tierrasanta Kiwanis Club on February 13. The presentations shared project details, including the schedule and opportunities for public participation. Staff also coordinated with
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local schools to minimize construction impacts during key school events, such as drop-off and pick- up times.
Mission Trails Flow Regulatory Structure I Water Quality Improvements Project Staff coordinated with the Belsera Homeowners Association and Mission Trails Regional Park stakeholders to install a fence and instrumentation control panel at San Diego 11 Flow Control Facility. Staff also provided project details to the same groups identified under the Mission Trails FRS II Project.
Prepared by: Mike Lee, Public Affairs Supervisor Teresa Penunuri, Public Affairs Supervisor Carlos Michelon, Principal Water Resources Specialist Reviewed by: Denise Vedder, Director of Public Outreach and Conservation Approved by: Dennis A. Cushman, Assistant General Manager
Attachment:
Exhibit 1 – Public Outreach and Conservation Activities
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EXHIBIT 1 Public Outreach and Conservation Activities January 2019 through March 2019
NEWS RELEASES/STATEMENTS ISSUED San Diego Region Wins $500,000 for Water Supply Development Research Projects Water Authority Saves Nearly $18 Million with Bond Refunding Raise a Toast! Water Authority Declares February as San Diego Brewing Month Water Authority General Manager Maureen A. Stapleton Retires after 23 Years Gail Goldberg Confirmed by Water Authority Board as Delegate to the Metropolitan Water District of Southern California
PRESENTATIONS* Kiwanis Club of Tierrasanta City of San Diego Economic Development Department City of Lemon Grove Planning Commission Escondido Chamber of Commerce Government Affairs Committee Cuyamaca College Center for Water Studies Women’s Symposium Rediscovering San Diego Council of Water Utilities CA-NV AWWA Conference UC Irvine Water Energy Nexus Symposium Imagine H20 Innovation Summit Association of Women in Water and Energy
*Does not include the 28 “coffee take-over” presentations during February at local chambers and EDCs.
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April 17, 2019
Attention: Legislation and Public Outreach Committee
Government Relations Update. (Information)
Purpose This report is an update of the Water Authority’s government relations program.
Discussion
The Legislature The Legislature began its spring recess on April 11 and is scheduled to return on April 22. Following its return to session, the Legislature will have only two weeks remaining to act on legislation in policy committees, and attention will begin to turn heavily to fiscal committee action. The last day for bills to pass out of each of the houses of origin and to remain active in 2019 is May 31.
Sponsored Legislation At its December 6, 2018 meeting, the Water Authority Board approved sponsorship of legislation for 2019.
o AB 1588 – co-sponsored by the Water Authority and Otay Water District – was introduced by Assemblymembers Todd Gloria and Adam Gray to provide a path of reciprocity and crediting for military veterans to apply their skills and experiences gained during military service toward water and wastewater system operation certifications. AB 1588 passed out of the Assembly Environmental Safety and Toxic Materials Committee on a unanimous vote on April 9, 2019. The measure is next scheduled to be considered in the Assembly Appropriations Committee during May 2019.
o Senator Ben Hueso has introduced placeholder legislation to work on creating opportunities for bulk energy storage projects to advance as assets to improve grid reliability and integration of renewable energy sources into the broader statewide energy system.
Board Member Sacramento Advocacy On April 1-2, Board Chair Jim Madaffer, Board Vice-Chair Gary Croucher, LPO Committee Chair Jerry Butkiewicz, and LPO Committee Vice-Chair Mel Katz traveled to Sacramento with Acting General Manager Sandy Kerl and Assistant General Manager Dan Denham for a series of briefings with members of the San Diego legislative delegation, legislative leadership, and the Governor’s office.
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During the visit, briefings focused on providing greater background and context regarding the Water Authority’s interest in utilizing Lake Mead storage opportunities, permitting challenges associated with the Carlsbad Desalination Plant intake facility, the San Diego region’s interests in advancing pumped hydropower storage opportunities, and seeking support for the Water Authority’s and Otay Water District’s co-sponsored legislation, AB 1588.
Status Report on Legislation and Legislative Positions Water Authority staff is currently actively reviewing and analyzing 42 bills that have been introduced at this early stage of the legislative session for potential impact on the organization and its member agencies. Staff routinely monitors hundreds of bills during each legislative session as they proceed through the legislative process or are amended. Only those measures that warrant a closer review are analyzed comprehensively and considered for advancement to the Water Authority Board for possible adoption of a position. The Water Authority’s staff and legislative advocates review each bill in the context of the adopted 2019 Legislative Policy Guidelines. The Legislative Policy Guidelines provide direction to staff and the Water Authority’s legislative advocates to communicate support of, or opposition to legislation and amendments. Bills for which staff recommends a position are brought before the Legislation and Public Outreach Committee and the Board for consideration of a Water Authority position. Attached is a list of legislation under review by Water Authority staff as of April 17, 2019.
Lobbyist Activities Steve Cruz of Cruz Strategies reports that he performed the following lobbying activities on behalf of the Water Authority over the past month:
• Provided strategic advice and information regarding the Water Authority’s legislative interests.
• Participated in briefings within the Capitol and with state agencies regarding pumped hydropower storage and the Water Authority’s 2019 legislative priorities.
• Arranged and participated in briefings with Water Authority Board members and management staff during the Board’s April 1-2 visit to Sacramento.
• Represented the Water Authority in a variety of venues on Water Authority issues.
• Coordinated with Bob Giroux and Water Authority staff on various legislative issues of importance to the Water Authority.
Bob Giroux of Lang, Hansen, O’Malley & Miller reports that he performed the following lobbying activities on behalf of the Water Authority over the past month:
• Provided strategic advice and information regarding the Water Authority’s legislative interests.
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• Communicated with legislative leadership, the Administration, and stakeholders regarding the San Diego region’s interests relative to bulk energy storage and the Carlsbad intake funding issue.
• Arranged and participated in briefings with Water Authority Board members and management staff during the Board’s April 1-2 visit to Sacramento.
• Coordinated with Steve Cruz and Water Authority staff on various legislative issues of importance to the Water Authority.
Audra Hartmann of Smith, Watts & Hartmann reports that she performed the following regulatory advocacy activities on behalf of the Water Authority over the past month:
• Coordinated meetings with SWRCB members and staff relative to the issue of the Carlsbad Desalination facility intake modifications.
• Participated in SWRCB meetings regarding emerging water quality issues of interest to the Water Authority.
• Provided strategic advice and information regarding the Water Authority’s regulatory interests.
• Coordinated with Water Authority staff on various regulatory issues of interest to the Water Authority.
Washington, D.C. Ken Carpi of Carpi & Clay will provide an in-person report for the LPO Committee and will submit a separate written report of the firm’s monthly activities in Washington, D.C.
Prepared by: Glenn A. Farrel, Government Relations Manager Ivy Ridderbusch, Legislative Analyst Approved by: Dennis A. Cushman, Assistant General Manager
Attachment: Substantive Legislation Report – April 17, 2019
Page 35 of 146 Substantive State Legislation Under Review by Water Authority Staff April 17, 2019
AB 56 (Garcia, Eduardo D) California Clean Electricity Authority Current Text: Amended: 3/18/2019 html pdf Introduced: 12/3/2018 Status: 4/1/2019-In committee: Set, first hearing. Hearing canceled at the request of author. Summary: Would authorize the Public Utilities Commission (PUC) and the State Energy Resources Conservation and Development Commission (Energy Commission) to jointly establish the California Clean Electricity Authority, a nonprofit, public benefit corporation, if both commissions make certain findings. The bill would authorize the authority to undertake procurement of electricity on behalf of retail end-use customers of electrical corporations, community choice aggregators, and electric service providers, collectively referred to as load-serving entities, and local publicly owned electric utilities, in support of certain energy, environmental, economic, public health, and public safety policy objectives.
AB 134 (Bloom D) Safe, clean, affordable, and accessible drinking water. Current Text: Amended: 3/25/2019 html pdf Introduced: 12/5/2018 Status: 3/27/2019-From committee: Do pass and re-refer to Com. on APPR. (Ayes 6. Noes 0.) (March 26). Re-referred to Com. on APPR. Summary: Would state findings and declarations relating to the intent of the Legislature to adopt policies to ensure that every Californian has the right to safe, clean, affordable, and accessible drinking water. The bill would require, if a Safe Drinking Water Fund or Safe and Affordable Drinking Water Fund is established, the funding to be displayed in the annual Governor’s budget, as prescribed, and, at least every 5 years, would require the Legislative Analyst’s Office to provide an assessment of the effectiveness of expenditures from the fund.
AB 217 (Garcia, Eduardo D) Safe Drinking Water for All Act. Current Text: Amended: 3/28/2019 html pdf Introduced: 1/16/2019 Status: 4/1/2019-Re-referred to Com. on APPR. Summary: Would enact the Safe Drinking Water for All Act and would establish the Safe and Affordable Drinking Water Fund in the State Treasury and would provide that moneys in the fund are continuously appropriated to the board to provide a source of funding to secure access to safe drinking water for all Californians, while also ensuring the long-term sustainability of drinking water service and infrastructure.
AB 223 (Stone, Mark D) California Safe Drinking Water Act: microplastics. Current Text: Introduced: 1/16/2019 html pdf Introduced: 1/16/2019 Status: 2/25/2019-In committee: Set, first hearing. Hearing canceled at the request of author. Summary: The California Safe Drinking Water Act requires the State Water Resources Control Board to administer provisions relating to the regulation of drinking water to protect public health. Current law requires the state board, on or before July 1, 2020, to adopt a definition of microplastics in drinking water and, on or before July 1, 2021, to adopt a standard methodology to be used in the testing of drinking water for microplastics and requirements for 4 years of testing and reporting of microplastics in drinking water, including public disclosure of those results. This bill would require the state board, to the extent possible, and where feasible and cost effective, to work with the State Department of Public Health in complying with those requirements.
AB 292 (Quirk D) Recycled water: raw water and groundwater augmentation. Current Text: Amended: 3/6/2019 html pdf Introduced: 1/28/2019 Status: 3/12/2019-From committee: Do pass and re-refer to Com. on W., P., & W. with recommendation: To Consent Calendar. (Ayes 7. Noes 0.) (March 12). Re-referred to Com. on W., P., & W. Summary: Current law requires the State Water Resources Control Board, on or before December 31, 2023, to adopt uniform water recycling criteria for direct potable reuse through raw water augmentation, as specified. Current law defines “direct potable reuse” and “indirect potable reuse for groundwater recharge” for these purposes. This bill would eliminate the definition of “direct potable reuse” and instead would substitute the term “groundwater augmentation” for “indirect potable reuse for groundwater recharge” in these definitions. The bill would revise the definition of “treated drinking water augmentation.”
AB 402 (Quirk D) State Water Resources Control Board: local primacy delegation: funding stabilization program. Current Text: Amended: 3/5/2019 html pdf Page 1/8
Page 36 of 146 Introduced: 2/6/2019 Status: 3/20/2019-In committee: Set, first hearing. Referred to suspense file. Summary: The California Safe Drinking Water Act requires the State Water Resources Control Board to administer provisions relating to the regulation of drinking water to protect public health. The act requires the state board to provide the local primacy agency, to the extent funds are available from the Safe Drinking Water Account, with an annual drinking water surveillance program grant to cover the costs of conducting inspection, monitoring, surveillance, and water quality evaluation activities specified in the local primacy agreement. The act requires the state board to adopt a schedule of fees and requires a public water system under the jurisdiction of a local primacy agency to pay these fees to the local primacy agency in lieu of the state board. This bill would include enforcement costs as costs covered by an annual drinking water surveillance program grant.
AB 405 (Rubio, Blanca D) Sales and use taxes: exemption: water treatment. Current Text: Introduced: 2/7/2019 html pdf Introduced: 2/7/2019 Status: 3/11/2019-In committee: Hearing for testimony only. Summary: Would exempt from Sales and Use Tax the gross receipts from the sale in this state of, and the storage, use, or other consumption in this state of, chemicals used to treat water, recycled water, or wastewater regardless of whether those chemicals or other agents become a component part thereof and regardless of whether the treatment takes place before or after the delivery to consumers.
AB 441 (Eggman D) Water: underground storage. Current Text: Amended: 3/27/2019 html pdf Introduced: 2/11/2019 Status: 3/28/2019-Re-referred to Com. on APPR. Summary: Under current law, the right to water or to the use of water is limited to that amount of water that may be reasonably required for the beneficial use to be served. Current law provides for the reversion of water rights to which a person is entitled when the person fails to beneficially use the water for a period of 5 years. Current law declares that the storing of water underground, and related diversions for that purpose, constitute a beneficial use of water if the stored water is thereafter applied to the beneficial purposes for which the appropriation for storage was made. This bill would instead provide that any diversion of water to underground storage constitutes a diversion of water for beneficial use for which an appropriation may be made if the diverted water is put to beneficial use, as specified.
AB 456 (Chiu D) Public contracts: claim resolution. Current Text: Introduced: 2/11/2019 html pdf Introduced: 2/11/2019 Status: 3/27/2019-From committee: Do pass and re-refer to Com. on APPR. (Ayes 6. Noes 0.) (March 27). Re-referred to Com. on APPR. Summary: Current law prescribes various requirements regarding the formation, content, and enforcement of state and local public contracts. Current law establishes, until January 1, 2020, for contracts entered into on or after January 1, 2017, a claim resolution process applicable to any claim by a contractor in connection with a public works project against a public entity, as defined. Current law defines a claim for these purposes as a separate demand by the contractor for one or more of the following: a time extension for relief from damages or penalties for delay, payment of money or damages arising from work done pursuant to the contract for a public work, or payment of an amount disputed by the public entity, as specified. This bill would remove the January 1, 2020, repeal date on these provisions, thereby making this claim resolution process operative indefinitely.
AB 510 (Cooley D) Local government records: destruction of records. Current Text: Introduced: 2/13/2019 html pdf Introduced: 2/13/2019 Status: 2/21/2019-Referred to Com. on L. GOV. Summary: Current law authorizes the head of a department of a county or city, or the head of a special district to destroy recordings of telephone and radio communications maintained by that county, city, or special district after 100 days if that person receives approval from the legislative body and the written consent of the agency attorney. This bill would exempt the head of a department of a county or city, or the head of a special district from these recording retention requirements if the county, city, or special district adopts a records retention policy governing recordings of routine video monitoring and recordings of telephone and radio communications.
AB 533 (Holden D) Income taxes: exclusion: turf removal water conservation program. Current Text: Amended: 4/4/2019 html pdf Introduced: 2/13/2019 Status: 4/8/2019-Re-referred to Com. on REV. & TAX. Summary: Current law, for taxable years beginning on or after January 1, 2014, and before January 1, Page 2/8
Page 37 of 146 2019, excludes from gross income under both laws any amount received as a rebate, voucher, or other financial incentive issued by a local water agency or supplier for participation in a turf removal water conservation program. Current law limits the collection and use of taxpayer information and provides that any unauthorized use of this information is punishable as a misdemeanor. This bill would extend the operative date of the provisions excluding from gross income specified amounts received in a turf removal water conservation program to taxable years beginning before January 1, 2024.
AB 557 (Wood D) Atmospheric Rivers: Research, Mitigation, and Climate Forecasting Program. Current Text: Introduced: 2/13/2019 html pdf Introduced: 2/13/2019 Status: 4/3/2019-In committee: Set, first hearing. Referred to APPR. suspense file. Summary: Would appropriate $9,250,000 from the General Fund to the Department of Water Resources in the 2019–20 fiscal year to operate the Atmospheric Rivers: Research, Mitigation, and Climate Forecasting Program.
AB 637 (Gray D) State Water Resources Control Board: minority and low-income communities: drinking water. Current Text: Amended: 3/19/2019 html pdf Introduced: 2/15/2019 Status: 3/26/2019-In committee: Set, first hearing. Hearing canceled at the request of author. Summary: Would require the State Water Resources Control Board, before taking actions that impact drinking water, to identify potential adverse human health effects that the proposed action may have on minority and low-income populations and to seek to reduce those effects to the greatest extent practicable.
AB 638 (Gray D) Department of Water Resources: water storage capacity. Current Text: Introduced: 2/15/2019 html pdf Introduced: 2/15/2019 Status: 3/26/2019-From committee: Do pass and re-refer to Com. on APPR. (Ayes 14. Noes 0.) (March 26). Re-referred to Com. on APPR. Summary: Current law requires the Department of Water Resources to update every 5 years the plan for the orderly and coordinated control, protection, conservation, development, and use of the water resources of the state, which is known as The California Water Plan. This bill would require the department, on or before January 1, 2021, with updates every 2 years thereafter, to identify the statewide water storage capacity, the adverse impacts to the capacity from the effects of climate change, and the mitigation strategies for anticipated adverse impacts.
AB 756 (Garcia, Cristina D) Public water systems: contaminants. Current Text: Amended: 3/13/2019 html pdf Introduced: 2/19/2019 Status: 3/27/2019-From committee: Do pass and re-refer to Com. on APPR. (Ayes 6. Noes 0.) (March 26). Re-referred to Com. on APPR. Summary: Would require a public water system to monitor for perfluoroalkyl and polyfluoroalkyl substances. The bill would additionally require a public water system to publish and keep current on its internet website water quality information relating to regulated contaminants and to notify each customer on the customer’s next water bill and through email, as prescribed, of confirmed detections of specified excess contaminants.
AB 782 (Berman D) California Environmental Quality Act: exemption: public agencies: land transfers. Current Text: Amended: 4/2/2019 html pdf Introduced: 2/19/2019 Status: 4/3/2019-Re-referred to Com. on APPR. Summary: Would exempt from CEQA the acquisition, sale, or other transfer of interest in land by a public agency for certain purposes, or the granting or acceptance of funding by a public agency for those purposes, if the public agency conditions those transactions on environmental review in accordance with CEQA before making physical changes to the transferred land before making those changes.
AB 841 (Ting D) Drinking water: contaminants: perfluoroalkyl and polyfluoroalkyl substances. Current Text: Amended: 3/20/2019 html pdf Introduced: 2/20/2019 Status: 3/27/2019-From committee: Do pass and re-refer to Com. on APPR. (Ayes 8. Noes 0.) (March 26). Re-referred to Com. on APPR. Summary: Would require the Office of Environmental Health Hazard Assessment to adopt and complete a work plan within prescribed timeframes to assess which substances in the class of perfluoroalkyl and polyfluoroalkyl substances should be identified as a potential risk to human health, as provided. The bill would require the office, as part of those assessments, to determine which of the Page 3/8
Page 38 of 146 substances are appropriate candidates for notification levels to be adopted by the state board. The bill would require the Office of Environmental Health Hazard Assessment, by January 1, 2022, to provide to the Legislature an update on the assessment.
AB 854 (Mayes R) Imperial Irrigation District: retail electric service. Current Text: Introduced: 2/20/2019 html pdf Introduced: 2/20/2019 Status: 3/4/2019-Referred to Com. on L. GOV. Summary: Would require the membership of the board of directors of the Imperial Irrigation District to increase from 5 to 11 members, with the 6 additional directors meeting certain qualifications, including that each be a resident of and qualified as eligible to vote in the County of Riverside. The bill would provide for the election of the additional directors at the 2020 general district election. The bill would authorize the district board to adopt a resolution decreasing the number of directors and the divisions from which they are elected from 11 to 5 if a public utility district is formed that provides electricity outside the territory of the Imperial Irrigation District and consists of a board of directors with a majority of seats representing the County of Riverside.
AB 868 (Bigelow R) Electrical corporations, electrical cooperatives, local publicly owned electric utilities: wildfire mitigation plans. Current Text: Amended: 3/25/2019 html pdf Introduced: 2/20/2019 Status: 4/8/2019-From committee: Amend, and do pass as amended and re-refer to Com. on APPR. (Ayes 15. Noes 0.) (April 3). Summary: Would require each electrical corporation, local publicly owned electric utility, and electrical cooperative that deenergizes portions of the electrical grid as a wildfire mitigation measure to adopt protocols for when deenergization will be undertaken, protocols for providing notice and other steps to be taken to minimize any adverse effects from deenergization, and protocols for restoring electrical service following a deenergization, as specified.
AB 915 (Mayes R) California Renewables Portfolio Standards Program. Current Text: Introduced: 2/20/2019 html pdf Introduced: 2/20/2019 Status: 4/4/2019-In committee: Set, first hearing. Hearing canceled at the request of author. Summary: Would require that retail sellers and local publicly owned electric utilities procure a minimum quantity of electricity products from eligible renewable energy resources so that the total kilowatthours of those products sold to their retail end-use customers achieve 68% of retail sales by December 31, 2033, 76% by December 31, 2036, and 80% by December 31, 2038. The bill would revise the definition of “eligible renewable resource” for purposes of the program to include, on and after January 1, 2026, an electrical generation facility that has a specified point source emission level of carbon dioxide equivalent at, or below, a specified level, if the marginal increase in the cost of procurement from other eligible renewable energy resources exceeds a specified level.
AB 933 (Petrie-Norris D) Ecosystem resilience: watershed protection: watershed coordinators. Current Text: Amended: 4/1/2019 html pdf Introduced: 2/20/2019 Status: 4/8/2019-VOTE: Do pass and be re-referred to the Committee on [Appropriations] with recommendation: To Consent Calendar Summary: Would authorize the Department of Conservation, to the extent funds are available, to establish and administer the Ecosystem Resilience Program to fund watershed coordinator positions, and other necessary costs, throughout the state for the purpose of achieving specified goals, including the goal of developing and implementing watershed improvement plans aligned with multiple statewide and regional objectives across distinct bioregions. The bill would authorize the department to develop performance measures and accountability controls to track progress and outcomes.
AB 939 (Frazier D) California Environmental Protection Agency: regulations. Current Text: Introduced: 2/20/2019 html pdf Introduced: 2/20/2019 Status: 3/21/2019-In committee: Set, first hearing. Hearing canceled at the request of author. Summary: Current law requires a state agency, prior to publication of the required notice, to involve parties who would be subject to the proposed regulations in public discussions when the proposed regulation involves complex proposals or a large number of proposals that cannot be easily reviewed during the comment period. Current law provides that if a public hearing is held, both oral and written statements, arguments, and contentions are required to be permitted, and, if a public hearing is not held, the state agency is required to afford any interested party or the party’s duly authorized representative the opportunity to present statements, arguments, and contentions in writing. This bill would require the California Environmental Protection Agency and any department, board, commission, or office within the California Environmental Protection Agency to provide to the public, not later than 72 hours prior to involvement of the public through workshops or any other proceedings, all material Page 4/8
Page 39 of 146 and presentations relevant to the process regarding complex proposals described above.
AB 945 (McCarty D) Local government: financial affairs: surplus funds. Current Text: Introduced: 2/20/2019 html pdf Introduced: 2/20/2019 Status: 3/4/2019-Referred to Coms. on L. GOV. and B. & F. Summary: Existing law prescribes the instruments and criteria by which a local agency, as defined, may invest and deposit its funds, including its surplus funds. This bill would, commencing January 1, 2020, authorize a local agency to invest and deposit the agency’s surplus funds in deposits at specified types of financial institutions whether those investments are certificates of deposit or another form, and would increase the percentage of the local agency’s funds that can be invested to 50%. The bill would make additional conforming changes.
AB 1180 (Friedman D) Water: recycled water. Current Text: Amended: 3/28/2019 html pdf Introduced: 2/21/2019 Status: 4/1/2019-Re-referred to Com. on APPR. Summary: The California Safe Drinking Water Act requires the State Water Resources Control Board to administer provisions relating to the regulation of drinking water to protect public health. Current law requires, on or before January 1, 2020, the state board to adopt standards for backflow protection and cross-connection control through the adoption of a policy handbook, as specified. This bill would require that handbook to include provisions for the use of a swivel or changeover device to supply potable water to a dual-plumbed system during an interruption in recycled water service.
AB 1184 (Gloria D) Public records: writing transmitted by electronic mail: retention. Current Text: Amended: 3/25/2019 html pdf Introduced: 2/21/2019 Status: 3/26/2019-Re-referred to Com. on JUD. Summary: Would, notwithstanding any law, require public agencies to retain and preserve energy writing transmitted by electronic mail for a period of at least 2 years.This bill contains other existing laws.
AB 1468 (McCarty D) Opioid Prevention and Rehabilitation Act. Current Text: Introduced: 2/22/2019 html pdf Introduced: 2/22/2019 Status: 3/14/2019-Referred to Com. on HEALTH. Summary: Would, commencing with the 2021–22 fiscal year, require a manufacturer or wholesaler that sells or distributes opioid drugs in this state to submit to the State Department of Public Health a report, including specified information, that details all opioid drugs sold or distributed in this state during the preceding fiscal year. The bill would, commencing with the 2021–22 fiscal year, require the department, in consultation with the board, to calculate the ratable share of a manufacturer or wholesaler, which is the individual portion of the collective sum of $100,000,000 to be paid by the manufacturers and wholesalers, based on the information reported.
AB 1588 (Gloria D) Drinking water and wastewater operator certification programs. Current Text: Amended: 4/2/2019 html pdf Introduced: 2/22/2019 Status: 4/3/2019-Re-referred to Com. on E.S. & T.M. Summary: Current law requires a person who operates a nonexempt wastewater treatment plant to possess a valid, unexpired wastewater certificate or water treatment operator certificate of the appropriate grade. This bill, when applying for certification by the board as a water treatment operator, distribution system operator, or wastewater operator, would require operators of complex industrial facilities, including members of the military and military service veterans, to receive full equivalent experience credit and education credit for work and tasks performed that are directly related to the operation of water or wastewater facilities, as specified.
ACA 3 (Mathis R) Clean Water for All Act. Current Text: Amended: 3/20/2019 html pdf Introduced: 1/16/2019 Status: 3/21/2019-Re-referred to Com. on W., P., & W. Measure version as amended on March 20 corrected. Summary: This measure, the Clean Water for All Act, would additionally require, commencing with the 2021–22 fiscal year, not less than 2% of specified state revenues to be set apart for the payment of principal and interest on bonds authorized pursuant to the Water Quality, Supply, and Infrastructure Improvement Act of 2014; water supply, delivery, and quality projects administered by the department, and water quality projects administered by the state board, as provided.
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Page 40 of 146 SB 1 (Atkins D) California Environmental, Public Health, and Workers Defense Act of 2019. Current Text: Introduced: 12/3/2018 html pdf Introduced: 12/3/2018 Status: 3/22/2019-Set for hearing April 9. Summary: Current state law regulates the discharge of air pollutants into the atmosphere. The Porter-Cologne Water Quality Control Act regulates the discharge of pollutants into the waters of the state. The California Safe Drinking Water Act establishes standards for drinking water and regulates drinking water systems. The California Endangered Species Act requires the Fish and Game Commission to establish a list of endangered species and a list of threatened species, and generally prohibits the taking of those species. This bill would require specified agencies to take prescribed actions regarding certain federal requirements and standards pertaining to air, water, and protected species, as specified.
SB 45 (Allen D) Wildfire, Drought, and Flood Protection Bond Act of 2020. Current Text: Amended: 4/4/2019 html pdf Introduced: 12/3/2018 Status: 4/4/2019-Read second time and amended. Re-referred to Com. on GOV. & F. Summary: Would enact the Wildfire, Drought, and Flood Protection Bond Act of 2020, which, if approved by the voters, would authorize the issuance of bonds in the amount of $4,300,000,000 pursuant to the State General Obligation Bond Law to finance projects to restore fire damaged areas, reduce wildfire risk, create healthy forest and watersheds, reduce climate impacts on urban areas and vulnerable populations, protect water supply and water quality, protect rivers, lakes, and streams, reduce flood risk, protect fish and wildlife from climate impacts, improve climate resilience of agricultural lands, and protect coastal lands and resources.
SB 134 (Hertzberg D) Water conservation: water loss performance standards: enforcement. Current Text: Introduced: 1/15/2019 html pdf Introduced: 1/15/2019 Status: 3/13/2019-Set for hearing April 9. Summary: Current law authorizes the State Water Resources Control Board to issue information orders, written notices, and conservation orders to an urban retail water supplier that does not meet its urban water use objective, and existing law authorizes the board to impose civil liability for a violation of an order or regulation issued pursuant to these provisions, as specified. Current law requires the board, no earlier than January 1, 2019, and no later than July 1, 2020, to adopt rules requiring urban retail water suppliers to meet performance standards for the volume of water losses. This bill would prohibit the board from imposing liability for a violation of the performance standards for the volume of water losses except as part of the enforcement of an urban water use objective.
SB 166 (Wiener D) Process water treatment systems: breweries and wineries: study group. Current Text: Amended: 3/21/2019 html pdf Introduced: 1/28/2019 Status: 4/3/2019-From committee: Do pass and re-refer to Com. on APPR. (Ayes 7. Noes 0.) (April 3). Re-referred to Com. on APPR. Summary: Current law requires the State Water Resources Control Board to establish uniform statewide recycling criteria for each varying type of use of recycled water where the use involves the protection of public health. Current law requires, on or before December 1, 2022, the state board, in consultation with specified state agencies, to adopt regulations for risk-based water quality standards for the onsite treatment and reuse of nonpotable water, as provided. This bill would require the state board, on or before December 1 2021, to convene a prescribed study group to advise the Legislature on policies regarding the onsite reuse of process water in breweries and wineries.
SB 241 (Moorlach R) Public agencies: joint powers authorities: contracts. Current Text: Amended: 4/2/2019 html pdf Introduced: 2/11/2019 Status: 4/8/2019-April 10 set for first hearing canceled at the request of author. Summary: Would require the governing body of a majority of the member agencies of an agency established pursuant to a joint powers agreement to approve and ratify each memorandum of understanding negotiated between the joint powers agency and its employees, and submit that approval and ratification to the governing body of the agency, within 45 calendar days of receipt.
SB 255 (Bradford D) Women, minority, disabled veteran, and LGBT business enterprise procurement: electric service providers: energy storage system companies: community choice aggregators. Current Text: Amended: 4/2/2019 html pdf Introduced: 2/12/2019 Status: 4/2/2019-Read second time and amended. Re-referred to Com. on APPR. Summary: Current law directs the Public Utilities Commission to require every electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, and telephone Page 6/8
Page 41 of 146 corporation with annual gross revenues exceeding $25,000,000, and their regulated subsidiaries and affiliates, to annually submit a detailed and verifiable plan for increasing procurement from women, minority, disabled veteran, and LGBT business enterprises, as defined, in all categories, including a renewable energy project, as defined, and wireless telecommunications, broadband, smart grid, and rail projects. Current law requires the reporting of certain information about the implementation of the plans. This bill would change the $25,000,000 annual gross revenue threshold above which these requirements become applicable to $1,000,000 in gross annual California revenues, and would extend these requirements to electric service providers, certain wholesale generators selling electricity to retail sellers, distributed energy resource contractors, and energy storage system companies, as specified.
SB 288 (Wiener D) Electricity: renewable resource self-generation and storage. Current Text: Amended: 3/28/2019 html pdf Introduced: 2/13/2019 Status: 3/28/2019-From committee with author's amendments. Read second time and amended. Re- referred to Com. on E., U. & C. Summary: Would, by January 1, 2021, require the PUC and the governing board of each local publicly owned electric utility to, among other things, create one or more tariffs that offer fair compensation for customer-sited energy storage systems that export electricity to the electrical grid and to consider one or more tariffs for customer-sited renewable energy and energy storage systems to support grid reliability and community resiliency in the event of emergencies or grid outages.
SB 307 (Roth D) Water conveyance: use of facility with unused capacity. Current Text: Introduced: 2/15/2019 html pdf Introduced: 2/15/2019 Status: 3/26/2019-Set for hearing April 9. Summary: Current law prohibits the state or a regional or local public agency from denying a bona fide transferor of water from using a water conveyance facility that has unused capacity for the period of time for which that capacity is available, if fair compensation is paid for that use and other requirements are met. This bill would, notwithstanding that provision, prohibit a transferor of water from using a water conveyance facility that has unused capacity to transfer water from a groundwater basin underlying desert lands, as defined, that is in the vicinity of specified federal lands or state lands to outside of the groundwater basin unless the State Lands Commission, in consultation with the Department of Fish and Wildlife, finds that the transfer of the water will not adversely affect the natural or cultural resources of those federal and state lands.
SB 332 (Hertzberg D) Wastewater treatment: recycled water. Current Text: Introduced: 2/19/2019 html pdf Introduced: 2/19/2019 Status: 4/5/2019-Set for hearing April 23. Summary: Would declare, except in compliance with the bill’s provisions, that the discharge of treated wastewater from ocean outfalls is a waste and unreasonable use of water. The bill would require each wastewater treatment facility that discharges through an ocean outfall and affiliated water suppliers to reduce the facility’s annual flow as compared to the average annual wastewater discharge baseline volume, as prescribed, by at least 50% on or before January 1, 2030, and by at least 95% on or before January 1, 2040. The bill would subject the owner or operator of a wastewater treatment facility, as well as the affiliated water suppliers, to a civil penalty of $2,000 per acre-foot of water above the required reduction in overall volume discharge for the failure to meet these deadlines.
SB 355 (Portantino D) Joint powers agencies: meetings. Current Text: Introduced: 2/19/2019 html pdf Introduced: 2/19/2019 Status: 4/8/2019-April 10 set for first hearing canceled at the request of author. Summary: Current law authorizes a joint powers agency to include in its joint powers agreement provisions authorizing, among others, any designated alternate member of the legislative body of the joint powers agency is also a member of the legislative body of a member local agency, and who is attending in lieu of that agency’s regularly appointed member, to attend closed sessions of the joint powers agency, as specified. This bill would eliminate the requirement that the designated alternate member of the legislative body of the joint powers agency also be a member of the legislative body of a member local agency.
SB 386 (Caballero D) California Renewables Portfolio Standard Program: irrigation districts. Current Text: Introduced: 2/20/2019 html pdf Introduced: 2/20/2019 Status: 3/25/2019-March 27 hearing postponed by committee. Summary: Would provide that hydroelectric generation that is owned by one or more irrigation districts is an eligible renewable energy resource for purposes of the California Renewables Portfolio Standard Program if it has a first point of interconnection with a California balancing authority or has a Page 7/8
Page 42 of 146 first point of interconnection with distribution facilities used to serve end users within a California balancing authority area.
SB 414 (Caballero D) Small System Water Authority Act of 2019. Current Text: Amended: 4/4/2019 html pdf Introduced: 2/20/2019 Status: 4/4/2019-Read second time and amended. Re-referred to Com. on APPR. Summary: Would create the Small System Water Authority Act of 2019 and state legislative findings and declarations relating to authorizing the creation of small system water authorities that will have powers to absorb, improve, and competently operate noncompliant public water systems. The bill, no later than March 1, 2020, would require the state board to provide written notice to cure to all public agencies, private water companies, or mutual water companies that operate a public water system that has either less than 3,000 service connections or that serves less than 10,000 people, and are not in compliance, for the period from July 1, 2018, through December 31, 2019, with one or more state or federal primary drinking water standard maximum contaminant levels, as specified.
SB 487 (Caballero D) Department of Water Resources: aerial snow survey. Current Text: Introduced: 2/21/2019 html pdf Introduced: 2/21/2019 Status: 4/5/2019-Set for hearing April 22. Summary: Would require the Department of Water Resources’ California snow survey program to conduct aerial surveys of the snowpack in the Trinity Alps and Sierra Nevada Mountains, including hydrologic areas that drain or supply water to certain major reservoirs and lakes. The bill would require the department to collect the aerial survey data up to 10 times per year in each hydrologic area and to summarize and make publicly available the data obtained and digital products used to produce runoff forecasts, as specified.
SB 785 (Committee on Natural Resources and Water) Public resources: parklands, freshwater resources, and coastal resources. Current Text: Introduced: 3/11/2019 html pdf Introduced: 3/11/2019 Status: 3/22/2019-Set for hearing April 23. Summary: Current law, until January 1, 2020, generally prohibits a person from possessing, importing, shipping, or transporting in the state, or from placing, planting, or causing to be placed or planted in any water within the state, dreissenid mussels, and authorizes the Director of Fish and Wildlife or the director’s designee to engage in various enforcement activities with regard to dreissenid mussels. Among those activities, current law authorizes the director to conduct inspections of waters of the state and facilities located within waters of the state that may contain dreissenid mussels and, if those mussels are detected or may be present, order the closure of the affected waters or facilities to conveyances or otherwise restrict access to the affected waters or facilities, with the concurrence of the Secretary of the Natural Resources Agency. This bill would extend to January 1, 2030, the repeal date of those provisions. Total Measures: 42 Total Tracking Forms: 6
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ADMINISTRATIVE AND FINANCE COMMITTEE
AGENDA FOR
APRIL 25, 2019
Frank Hilliker– Chair Jim Murtland Jimmy Ayala – Vice Chair Elsa Saxod Barry Leonard – Vice Chair John Simpson Brian Boyle Tim Smith Chris Cate Almis Udrys Gary Croucher Ron Watkins Betty Evans Doug Wilson Mel Katz
1. Roll call – determination of quorum.
2. Additions to agenda (Government Code Section 54954.2(b)).
3. Public comment – opportunities for members of the public to address the Committee on matters within the Committee’s jurisdiction.
4. Chair’s Report. 4-A Directors’ comments.
I. CONSENT CALENDAR
1. Monthly Treasurer’s Report on Investments and Cash Flow. Lisa Marie Harris Staff recommendation: Note and file the Treasurer’s report. (Action)
2. Approve Capacity Fee Refund to Bosa Development California, Lisa Marie Harris Inc. Staff recommendation: Authorize Acting General Manager to issue a capacity charges refund in the amount of $138,712 to Bosa Development California, Inc. (Action)
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3. Microsoft Office 365 Service Renewal. Matt Bartolome Staff recommendation: Authorize the General Manager to execute an agreement with SoftwareOne in the amount of $448,571 to renew the Water Authority’s Microsoft Office 365 software licenses and provide related Microsoft services for a three-year period ending in May 2022. (Action)
II. ACTION/DISCUSSION/PRESENTATION
1. Preliminary Assessments for Calendar Year (CY) 2020 Rates and Lisa Marie Harris Charges. (Presentation)
2. Innovation Program Update. (Presentation) Gary Bousquet
III. INFORMATION
1. Controller’s Report on Monthly Financial Activity. Chris Woidzik
2. Board calendar.
IV CLOSED SESSION
1. Conference with the Labor Negotiator Mark Hattam Government Code §54957.6 Agency Designated Representatives: Gretchen Spaniol, Jason Foster, Liana Whyte, Rick Bolanos Employee Organization: Teamsters Local 911
V. ADJOURNMENT Melinda Nelson Clerk of the Board
NOTE: This meeting is called as an Administrative and Finance Committee meeting. Because a quorum of the Board may be present, the meeting is also noticed as a Board meeting. Members of the Board who are not members of the Committee may participate in the meeting pursuant to Section 2.00.060(g) of the Authority Administrative Code (Recodified). All items on the agenda, including information items, may be deliberated and become subject to action. All public documents provided to the committee or Board for this meeting including materials related to an item on this agenda and submitted to the Board of Directors within 72 hours prior to this meeting may be reviewed at the San Diego County Water Authority headquarters located at 4677 Overland Avenue, San Diego, CA 92123 at the reception desk during normal business hours.
Page 45 of 146
April 17, 2019
Attention: Administrative and Finance Committee
Monthly Treasurer’s Report on Investments and Cash Flow
Purpose The purpose of the Treasurer’s Report is to provide monthly financial information to the Board of Directors.
Executive Summary • The Water Authority’s overall portfolio of $381 million increased in yield to 2.38% exceeding investment benchmark of 2.27%. • Average Water Authority Portfolio term is 2.3 years. • Water Authority portfolio is well diversified with investment holdings in Agencies, Treasuries and Corporate notes totaling 64% of the portfolio.
Attached for review by the Administrative and Finance Committee and the Board of Directors is the Treasurer’s Report as of March 31, 2019. The reports are formatted to provide information as required by the California Government Code and the San Diego County Water Authority’s Annual Statement of Investment Policy, which was last adopted by the Board on December 6, 2018. A brief description of each report follows:
Portfolio Master Summary: This one-page report summarizes all cash and investments held by the Water Authority.
Chandler Portfolio Summary: This one-page snapshot shows the Chandler Asset portfolio holdings including average duration, coupon, yield and ratings; account summary; top issuers; sector allocation; maturity distribution; and credit quality.
Portfolio Details - Investments: This report takes the summary information listed in the Portfolio Master Summary and provides details of active investments.
Activity Summary: This one-page report produces a thirteen-month rolling summary of portfolio investment activity.
The Water Authority’s portfolio is diversified among investment types, with a current concentration toward short-term maturities. This concentration is the result of current cash flow needs. The portfolio is comprised of high quality investments, with approximately 80% invested in AAA rated or AAA/AA+ split-rated securities at month end. In March 2019, the Water Authority’s overall portfolio yield increased from 2.35% to 2.38% and continues to exceed the investment benchmark of 2.27%.
Page 46 of 146 Administrative and Finance Committee April 17, 2019 Page 2 of 2
All investments have been made in accordance with the San Diego County Water Authority Statement of Investment Policy. This report provides documentation that the Water Authority has sufficient funds to meet the financial obligations for the next six months. The market value information is provided by Bloomberg L.P. and is as of the report date.
______
Lisa Marie Harris, Director of Finance/Treasurer
Page 47 of 146 PORTFOLIO MASTER SUMMARY as of March 31, 2019 PORTFOLIO PERCENTAGES Permitted By Portfolio Investment Type Board Policy Percentage Book Value Local Agency Investment Fund (LAIF) $65 Million 3.73%$ 13,746,930 Banker's Acceptances 40% 0.00% - Treasury Securities* 100% 25.44% 93,697,104 Agency Securities* 100% 25.67% 94,537,636 Asset-Backed, Mortgage-Backed, Mortgage Pass-Through Securities, and Collateralized Mortgage Obligations 20% 2.51% 9,253,411 Supranational Securities* 10% 2.11% 7,790,040 Repurchase Agreements 20% 0.00% - Reverse Repurchase Agreements 20% 0.00% - Certificates of Deposit (Placement, Negotiable & Time Deposits) 30% 0.68% 2,500,000 Commercial Paper 25% 4.27% 15,719,500 Medium Term Notes/Corporates* 30% 13.42% 49,419,503 Municipal Securities 30% 0.00% - JPA Pools (CAMP) 25% 17.91% 65,970,746 Mutual Funds and Money Market Mutual Funds* 20% 4.26% 15,703,531 100.00%$ 368,338,401 Accrued Interest (unavailable for investing) 50,337 Checking/Petty Cash/Available Funds (unavailable for investing) 266,723 Subtotal for Pooled Funds: $ 368,655,461
Debt Service Reserve (DSR) Funds Excluded from Portfolio Percentages: Trinity Plus - Reserve (GIC) - Series 1998A COPs 12,240,775 Subtotal for Debt Service Reserve Funds (unavailable for CIP expenditures): $ 12,240,775 Total Cash and Investments $ 380,896,236
PORTFOLIO INFORMATION Pooled Debt Service Funds ** Reserve Total Portfolio Yield to Maturity - 365 Days 2.27% 5.55% 2.38% Average Term 882 1 853 Average Days to Maturity (730 Days Maximum) 478 1 462
* Some investments in these categories are managed by Chandler Asset Management. ** Pooled Funds include Operating, Pay Go, RSF, Equipment and Stored Water funds.
Page 48 of 146 SDCWATER Chandler Portfolio Summary Account #10569 As of March 31, 2019
PORTFOLIO CHARACTERISTICS ACCOUNT SUMMARY TOP ISSUERS Average Modified Duration 2.11 Beg. Values End Values Government of United States 29.0% as of 2/28/19 as of 3/31/19 Federal Home Loan Mortgage Corp 17.6% Average Coupon 2.06% Market Value 195,541,761 196,928,945 Federal National Mortgage Assoc 9.9% Accrued Interest 1,057,722 1,120,148 Average Purchase YTM 2.36% Federal Home Loan Bank 6.9% Total Market Value 196,599,483 198,049,092 Average Market YTM 2.47% Toronto Dominion Holdings 2.3% Income Earned 328,962 339,643 US Bancorp 2.0% Average S&P/Moody Rating AA/Aa1 Cont/WD -11,518 Par 196,987,630 197,214,944 Intl Bank Recon and Development 2.0% Average Final Maturity 2.31 yrs Book Value 195,028,101 195,301,501 Honda ABS 2.0% Average Life 2.23 yrs Cost Value 195,017,753 195,301,501 Total 71.7%
SECTOR ALLOCATION MATURITY DISTRIBUTION CREDIT QUALITY (S&P)
Page 49 of 146 SDCWA - Fiscal Year 2019
Portfolio Management Page 1 Portfolio Details - Investments March 31, 2019
Average Purchase Stated YTM Days to Maturity CUSIP Investment # Issuer Balance Date Par Value Market Value Book Value Rate S&P 365 Maturity Date Managed Pool Accounts CASH21 2200 Bank of New York Mellon Corp 2,509,943.70 2,509,943.70 2,509,943.70 2.500 A 2.500 1 CASH35 73 CAMP - OPERATING/POOLED 65,970,745.74 65,970,745.74 65,970,745.74 2.610 AAA 2.610 1 CASH45 4004 CAMP - 2010B BONDS-BABS 0.00 0.00 0.00 0.770 AAA 0.770 1 CASH43 4001 GOLDMAN - 2010B BONDS-BABS 07/01/2018 0.00 0.00 0.00 0.310 AAA 0.310 1 CASH11 0002 GOLDMAN - OPERATING/POOLED 230,179.37 230,179.37 230,179.37 2.310 AAA 2.310 1 CASH13 72 LAIF - OPERATING 13,746,929.51 13,746,929.51 13,746,929.51 2.392 2.392 1 CASH41 4002 LAIF - 2010B BONDS-BABS 07/01/2018 0.00 0.00 0.00 0.730 0.730 1 CASH17 204 TRINITY PLUS - 1998A 12,240,775.00 12,240,775.00 12,240,775.00 5.550 AA+ 5.550 1 CASH33 208 US BANK MONEY MARKET FUND 0.00 0.00 0.00 0.001 AAA 0.001 1
Subtotal and Average 102,670,861.11 94,698,573.32 94,698,573.32 94,698,573.32 2.955 1 Medium Term Notes 037833AQ3 20001 APPLE INC. 02/20/2015 1,950,000.00 1,949,044.50 1,982,662.50 2.100 AA+ 1.686 35 05/06/2019 06051GEU9 21031 Bank of America Corp 09/13/2018 2,000,000.00 2,025,400.00 1,974,080.00 3.300 A- 3.625 1,381 01/11/2023 084670BL1 20009 BERKSHIRE HATHAWAY INC. 06/18/2015 2,000,000.00 1,995,780.00 2,010,620.00 2.100 AA 1.966 135 08/14/2019 084670BR8 21053 BERKSHIRE HATHAWAY INC. 01/30/2019 1,000,000.00 1,005,970.00 985,150.00 2.750 AA 3.136 1,444 03/15/2023 06406RAA5 20015 Bank of New York Mellon Corp 03/21/2017 2,000,000.00 1,998,860.00 1,990,160.00 2.600 A 2.708 1,043 02/07/2022 06406HCS6 21057 Bank of New York Mellon Corp 03/21/2019 1,000,000.00 1,037,925.28 1,031,655.28 3.650 A 3.042 1,770 02/04/2024 166764AN0 20007 CHEVRON CORP. 05/15/2015 2,000,000.00 1,994,460.00 2,027,200.00 2.193 AA 1.876 228 11/15/2019 00440EAP2 21012 Chubb INA Holdings Inc 06/27/2018 2,000,000.00 1,994,340.00 1,935,580.00 2.700 A 3.446 1,442 03/13/2023 00440EAP2 21033 Chubb INA Holdings Inc 11/15/2018 1,000,000.00 997,170.00 964,090.00 2.700 A 3.603 1,442 03/13/2023 532457BQ0 20017 Eli Lilly & Co. 08/29/2017 2,000,000.00 1,988,640.00 2,017,440.00 2.350 AA- 2.154 1,140 05/15/2022 02665WCJ8 21014 AMERICAN HONDA FINANCE CORP 07/23/2018 1,500,000.00 1,541,370.00 1,500,885.00 3.450 A+ 3.437 1,565 07/14/2023 02665WCJ8 21040 AMERICAN HONDA FINANCE CORP 11/29/2018 1,000,000.00 1,027,580.00 993,040.00 3.450 A+ 3.614 1,565 07/14/2023 404280BF5 21022 HSBC HOLDINGS 08/28/2018 1,750,000.00 1,734,285.00 1,706,320.00 2.650 A 3.444 1,010 01/05/2022 404280BA6 21038 HSBC HOLDINGS 11/29/2018 1,000,000.00 1,017,920.00 981,090.00 3.600 A 4.075 1,515 05/25/2023 44932HAH6 21010 IBM CREDIT LLC 05/09/2018 1,500,000.00 1,511,265.00 1,473,885.00 3.000 A+ 3.400 1,407 02/06/2023 44932HAH6 21024 IBM CREDIT LLC 09/11/2018 500,000.00 503,755.00 493,485.00 3.000 A+ 3.320 1,407 02/06/2023 24422EUA5 21008 JOHN DEERE CAPITAL CORP 03/12/2018 2,000,000.00 1,996,200.00 1,955,820.00 2.700 A 3.198 1,376 01/06/2023 46625HJE1 21007 JP MORGAN SECURITIES LLC 02/22/2018 2,000,000.00 2,027,980.00 1,997,760.00 3.250 A- 3.276 1,271 09/23/2022 46625HRL6 21035 JP MORGAN SECURITIES LLC 11/19/2018 1,000,000.00 990,305.00 957,755.00 2.700 A- 3.731 1,508 05/18/2023 594918AY0 20011 MICROSOFT CORP. 08/31/2015 2,000,000.00 1,990,480.00 1,999,820.00 1.850 AAA 1.852 317 02/12/2020 742718EG0 20003 PROCTER & GAMBLE 03/30/2015 2,000,000.00 1,991,700.00 2,028,380.00 1.900 AA- 1.578 214 11/01/2019 69353RFB9 20016 PNC BANK NA 06/23/2017 2,000,000.00 1,997,300.00 2,024,720.00 2.625 A 2.343 1,053 02/17/2022 69353RFL7 21039 PNC BANK NA 11/29/2018 1,000,000.00 1,028,410.00 992,310.00 3.500 3.686 1,529 06/08/2023 808513AT2 21017 Charles Schwab Corp 07/24/2018 1,500,000.00 1,500,090.00 1,460,985.00 2.650 A 3.276 1,395 01/25/2023
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Portfolio Management Page 2 Portfolio Details - Investments March 31, 2019
Average Purchase Stated YTM Days to Maturity CUSIP Investment # Issuer Balance Date Par Value Market Value Book Value Rate S&P 365 Maturity Date Medium Term Notes 808513AT2 21023 Charles Schwab Corp 09/11/2018 500,000.00 500,030.00 485,900.00 2.650 A 3.348 1,395 01/25/2023 89114QC48 21025 TORONTO DOMINION BANK 09/11/2018 2,000,000.00 2,055,680.00 2,003,760.00 3.500 AA- 3.457 1,570 07/19/2023 89236TCZ6 20014 TOYOTA MOTOR CREDIT CORP. 05/27/2016 2,000,000.00 1,972,580.00 1,993,880.00 1.900 AA- 1.966 738 04/08/2021 89236TFN0 21036 TOYOTA MOTOR CREDIT CORP. 11/19/2018 1,000,000.00 1,030,870.00 993,060.00 3.450 AA- 3.607 1,633 09/20/2023 90331HML4 20012 US Bank NA 01/27/2016 2,000,000.00 1,995,240.00 2,010,200.00 2.125 AA- 1.983 210 10/28/2019 90331HML4 20013 US Bank NA 03/18/2016 2,000,000.00 1,995,240.00 2,011,200.00 2.125 AA- 1.963 210 10/28/2019 92826CAC6 21032 VISA INC 11/15/2018 2,500,000.00 2,525,625.00 2,441,850.00 2.800 A+ 3.415 1,353 12/14/2022
Subtotal and Average 49,686,081.45 49,700,000.00 49,921,494.78 49,424,742.78 2.801 1,006 Negotiable CD's 89114MCP0 21021 TORONTO DOMINION BANK/NY 08/28/2018 2,500,000.00 2,500,000.00 2,500,000.00 2.520 A-1 2.555 23 04/24/2019
Subtotal and Average 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2.555 23 Commercial Paper - Discount 46640QRH6 10221 JP MORGAN SECURITIES LLC 08/21/2018 10,000,000.00 9,986,647.00 9,832,700.00 2.520 A- 2.627 16 04/17/2019 46640QTM3 10223 JP MORGAN SECURITIES LLC 09/25/2018 3,000,000.00 2,981,954.10 2,939,475.00 2.700 A- 2.820 81 06/21/2019 89233HSU9 10222 TOYOTA MOTOR CREDIT CORP. 09/25/2018 3,000,000.00 2,987,900.10 2,947,325.00 2.580 AA- 2.690 57 05/28/2019
Subtotal and Average 17,512,699.29 16,000,000.00 15,956,501.20 15,719,500.00 2.675 36 Federal Agency - Coupon 3133EEWG1 10183 FEDERAL FARM CREDIT BANK 04/28/2016 3,500,000.00 3,500,000.00 3,521,000.00 1.300 AA+ 1.091 0 04/01/2019 3133EHFK4 10207 FEDERAL FARM CREDIT BANK 06/28/2017 1,350,000.00 1,349,365.50 1,347,961.50 1.320 AA+ 1.405 16 04/17/2019 3130ABBV7 10204 FEDERAL HOME LOAN BANK 05/31/2017 3,500,000.00 3,497,305.00 3,501,235.50 1.375 AA+ 1.358 28 04/29/2019 3130AEBM1 21013 FEDERAL HOME LOAN BANK 07/20/2018 2,000,000.00 2,027,360.00 1,994,260.00 2.750 AA+ 2.827 1,166 06/10/2022 313383QR5 21020 FEDERAL HOME LOAN BANK 08/27/2018 2,500,000.00 2,593,750.00 2,547,450.00 3.250 AA+ 2.822 1,530 06/09/2023 313383YJ4 21042 FEDERAL HOME LOAN BANK 11/30/2018 5,000,000.00 5,230,250.00 5,083,100.00 3.375 AA+ 2.998 1,621 09/08/2023 3130A0F70 21046 FEDERAL HOME LOAN BANK 12/18/2018 2,250,000.00 2,354,439.38 2,302,869.38 3.375 AA+ 2.885 1,712 12/08/2023 3130A0F70 21055 FEDERAL HOME LOAN BANK 02/14/2019 1,250,000.00 1,314,584.38 1,298,309.38 3.375 AA+ 2.652 1,712 12/08/2023 3137EADM8 10184 FEDERAL HOME LOAN MORTGAGE COR 04/28/2016 2,000,000.00 1,987,860.00 2,006,026.00 1.250 AA+ 1.160 184 10/02/2019 3137EADZ9 10187 FEDERAL HOME LOAN MORTGAGE COR 05/18/2016 6,500,000.00 6,496,620.00 6,520,800.00 1.125 AA+ 1.221 14 04/15/2019 3137EADZ9 10208 FEDERAL HOME LOAN MORTGAGE COR 06/28/2017 5,000,000.00 4,997,400.00 4,979,185.00 1.125 AA+ 1.360 14 04/15/2019 3137EAEF2 10209 FEDERAL HOME LOAN MORTGAGE COR 06/28/2017 5,000,000.00 4,945,700.00 4,974,075.00 1.375 AA+ 1.564 385 04/20/2020 3137EAEF2 10210 FEDERAL HOME LOAN MORTGAGE COR 07/17/2017 5,000,000.00 4,945,700.00 4,974,150.00 1.375 AA+ 1.567 385 04/20/2020 3137EAEF2 10214 FEDERAL HOME LOAN MORTGAGE COR 09/20/2017 20,000,000.00 19,782,800.00 19,910,600.00 1.375 AA+ 1.552 385 04/20/2020 3137EAEM7 10225 FEDERAL HOME LOAN MORTGAGE COR 09/28/2018 5,000,000.00 5,002,700.00 4,978,000.00 2.500 AA+ 2.788 388 04/23/2020 3137EAEN5 21028 FEDERAL HOME LOAN MORTGAGE COR 09/11/2018 3,000,000.00 3,052,320.00 2,981,820.00 2.750 AA+ 2.886 1,540 06/19/2023
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Portfolio Management Page 3 Portfolio Details - Investments March 31, 2019
Average Purchase Stated YTM Days to Maturity CUSIP Investment # Issuer Balance Date Par Value Market Value Book Value Rate S&P 365 Maturity Date Federal Agency - Coupon 3136G0EC1 10205 FEDERAL NATION MORTAGE ASSOC. 05/31/2017 4,040,000.00 4,023,355.20 4,101,763.52 2.050 AA+ 1.512 395 04/30/2020 3135G0R39 10213 FEDERAL NATION MORTAGE ASSOC. 08/17/2017 10,000,000.00 9,918,300.00 9,905,600.00 1.000 AA+ 1.440 206 10/24/2019 3136G0W23 10226 FEDERAL NATION MORTAGE ASSOC. 09/28/2018 2,235,000.00 2,212,605.30 2,189,829.55 1.500 AA+ 2.809 395 04/30/2020 3135G0T94 21030 FEDERAL NATION MORTAGE ASSOC. 09/11/2018 3,000,000.00 3,008,070.00 2,939,520.00 2.375 AA+ 2.870 1,389 01/19/2023 3135G0U43 21043 FEDERAL NATION MORTAGE ASSOC. 11/30/2018 2,500,000.00 2,558,500.00 2,489,925.00 2.875 AA+ 2.965 1,625 09/12/2023
Subtotal and Average 103,522,798.33 94,625,000.00 94,798,984.76 94,547,479.83 1.873 549 Treasury Securities - Coupon 912828D23 10160 UNITED STATES TREASURY 09/29/2015 6,000,000.00 5,996,040.00 6,098,906.25 1.625 AA+ 1.154 29 04/30/2019 912828D23 10167 UNITED STATES TREASURY 11/23/2015 4,000,000.00 3,997,360.00 4,038,125.00 1.625 AA+ 1.340 29 04/30/2019 912828K58 10181 UNITED STATES TREASURY 04/21/2016 10,000,000.00 9,890,200.00 10,082,812.50 1.375 AA+ 1.164 395 04/30/2020 912828VA5 10190 UNITED STATES TREASURY 11/10/2016 5,000,000.00 4,932,400.00 4,993,750.00 1.125 AA+ 1.162 395 04/30/2020 912828Q52 10191 UNITED STATES TREASURY 11/10/2016 5,000,000.00 4,997,000.00 4,989,062.50 0.875 AA+ 0.966 14 04/15/2019 912828D23 10193 UNITED STATES TREASURY 12/29/2016 5,000,000.00 4,996,700.00 5,027,343.75 1.625 AA+ 1.386 29 04/30/2019 912828K58 10194 UNITED STATES TREASURY 12/29/2016 5,000,000.00 4,945,100.00 4,950,000.00 1.375 AA+ 1.684 395 04/30/2020 912828F62 10198 UNITED STATES TREASURY 03/30/2017 5,000,000.00 4,972,050.00 5,009,179.69 1.500 AA+ 1.427 213 10/31/2019 912828D23 10217 UNITED STATES TREASURY 04/18/2018 12,000,000.00 11,992,080.00 11,928,750.00 1.625 AA+ 2.209 29 04/30/2019 912828F62 10224 UNITED STATES TREASURY 09/28/2018 5,000,000.00 4,972,050.00 4,938,085.94 1.500 AA+ 2.660 213 10/31/2019 912828P38 21003 UNITED STATES TREASURY 02/21/2018 1,250,000.00 1,227,687.50 1,196,972.66 1.750 AA+ 2.672 1,401 01/31/2023 912828W55 21004 UNITED STATES TREASURY 02/21/2018 1,250,000.00 1,237,062.50 1,216,015.63 1.875 AA+ 2.592 1,064 02/28/2022 9128283X6 21005 UNITED STATES TREASURY 02/21/2018 1,250,000.00 1,248,637.50 1,243,896.48 2.250 AA+ 2.421 686 02/15/2021 912828R28 21009 UNITED STATES TREASURY 05/08/2018 1,400,000.00 1,366,428.00 1,323,929.68 1.625 AA+ 2.802 1,490 04/30/2023 912828P38 21011 UNITED STATES TREASURY 06/26/2018 250,000.00 245,537.50 239,345.70 1.750 AA+ 2.743 1,401 01/31/2023 912828F96 21015 UNITED STATES TREASURY 07/23/2018 1,500,000.00 1,490,385.00 1,467,773.44 2.000 AA+ 2.690 944 10/31/2021 9128283C2 21016 UNITED STATES TREASURY 07/23/2018 1,500,000.00 1,487,985.00 1,455,937.50 2.000 AA+ 2.733 1,309 10/31/2022 9128282S8 21019 UNITED STATES TREASURY 08/27/2018 2,000,000.00 1,959,840.00 1,918,125.00 1.625 AA+ 2.709 1,248 08/31/2022 9128282D1 21026 UNITED STATES TREASURY 09/11/2018 3,000,000.00 2,892,383.45 2,800,394.08 1.375 AA+ 2.843 1,613 08/31/2023 9128284U1 21029 UNITED STATES TREASURY 09/11/2018 4,000,000.00 4,062,360.00 3,964,531.25 2.625 AA+ 2.823 1,551 06/30/2023 912828F62 21041 UNITED STATES TREASURY 11/29/2018 5,000,000.00 4,978,058.29 4,950,734.84 1.500 AA+ 2.724 213 10/31/2019 912828R28 21044 UNITED STATES TREASURY 11/30/2018 1,250,000.00 1,221,708.36 1,187,962.66 1.625 AA+ 2.862 1,490 04/30/2023 912828T91 21045 UNITED STATES TREASURY 11/30/2018 5,000,000.00 4,872,933.43 4,723,725.62 1.625 AA+ 2.867 1,674 10/31/2023 9128285Q9 21050 UNITED STATES TREASURY 12/31/2018 2,000,000.00 2,018,044.07 2,012,574.70 2.750 AA+ 2.537 609 11/30/2020 912828U57 21051 UNITED STATES TREASURY 12/31/2018 2,000,000.00 1,992,759.51 1,963,150.76 2.125 AA+ 2.566 1,704 11/30/2023
Subtotal and Average 93,721,085.63 94,650,000.00 93,992,790.11 93,721,085.63 1.956 519
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Portfolio Management Page 4 Portfolio Details - Investments March 31, 2019
Average Purchase Stated YTM Days to Maturity CUSIP Investment # Issuer Balance Date Par Value Market Value Book Value Rate S&P 365 Maturity Date Supranationals 4581X0CZ9 21002 Inter-American Devel. Bank 02/22/2018 2,000,000.00 1,961,920.00 1,910,420.00 1.750 AAA 2.803 1,262 09/14/2022 459058FY4 21006 Intl Bank Recon & Develop 02/22/2018 2,000,000.00 1,983,880.00 1,947,560.00 2.000 AAA 2.708 1,031 01/26/2022 459058GH0 21018 Intl Bank Recon & Develop 07/25/2018 2,000,000.00 2,019,340.00 1,996,700.00 2.750 AAA 2.808 844 07/23/2021 45950VLH7 21001 International Finance Corp 02/21/2018 2,000,000.00 1,976,860.00 1,935,360.00 2.000 2.741 1,302 10/24/2022
Subtotal and Average 7,790,040.00 8,000,000.00 7,942,000.00 7,790,040.00 2.765 1,107 Asset Backed Securities 43814PAC4 21037 HONDA AUTO RECEIVABLES LLC 11/28/2018 2,000,000.00 1,987,947.64 1,972,556.94 1.790 A+ 2.778 903 09/20/2021 43814PAC4 21052 HONDA AUTO RECEIVABLES LLC 01/17/2019 1,000,000.00 994,918.54 989,996.63 1.790 A+ 2.530 903 09/20/2021 43815AAC6 21056 HONDA AUTO RECEIVABLES LLC 03/18/2019 900,000.00 911,317.79 908,514.88 3.160 AAA 2.861 1,387 01/17/2023 47788BAD6 21034 John Deere Owner Trust 11/16/2018 2,000,000.00 1,987,396.31 1,972,522.99 1.820 2.813 928 10/15/2021 89238TAD5 21027 Toyota Auto Receivables 09/11/2018 2,000,000.00 2,019,101.16 2,003,103.69 2.960 2.898 1,263 09/15/2022 89239AAB9 21054 Toyota Auto Receivables 02/13/2019 1,415,000.00 1,420,686.33 1,417,986.09 2.830 AAA 3.200 1,263 09/15/2022
Subtotal and Average 8,766,463.38 9,315,000.00 9,321,367.77 9,264,681.22 2.858 1,089
Total and Average 390,303,571.67 369,488,573.32 369,131,711.94 367,666,102.78 2.380 462
Portfolio CWA2 CC Run Date: 04/10/2019 - 13:00 PM (PRF_PM2) 7.3.0 Page 53 of 146 SDCWA - Fiscal Year 2019
Portfolio Management Page 5 Portfolio Details - Cash March 31, 2019
Average Purchase Stated YTM Days to CUSIP Investment # Issuer Balance Date Par Value Market Value Book Value Rate S&P 365 Maturity Passbook/Checking Accounts CASH01 48 PETTY CASH 07/01/2018 2,500.00 2,500.00 2,500.00 0.000 1 CASH02 1000 WELLS FARGO - OPERATING/POOLED 268,895.77 268,895.77 268,895.77 0.001 0.001 1 CASH03 1001 WELLS FARGO - PAYROLL ZBA 07/01/2018 -4,672.75 -4,672.75 -4,672.75 0.000 1 CASH39 4000 WELLS FARGO - 2010B BONDS-BABS 07/01/2018 0.00 0.00 0.00 0.000 1
Managed Pool Accounts CASH04 1002 WELLS FARGO - OPER/SWEEP 03/12/2019 12,963,407.48 12,963,407.48 12,963,407.48 2.317 2.317 1
Average Balance 0.00 1
Total Cash and Investments 390,303,571.67 382,718,703.82 382,361,842.44 380,896,233.28 2.380 462
Portfolio CWA2 CC Run Date: 04/10/2019 - 13:00 PM (PRF_PM2) 7.3.0 Page 54 of 146 SDCWA - Fiscal Year 2019 Portfolio Management Page 1 Activity Summary March 2018 through March 2019
Yield to Maturity Managed Number Number Month Number of Total 360 365 Pool of Investments of Investments Average Average End Year Securities Invested Equivalent Equivalent Rate Purchased Redeemed Term Days to Maturity March 2018 76 395,193,009.08 1.575 1.597 2.043 1 1 708 301 April 2018 65 326,198,345.22 1.732 1.757 2.098 1 12 682 355 May 2018 67 337,842,814.13 1.819 1.844 2.258 3 1 669 340 June 2018 68 338,091,900.59 1.860 1.886 2.341 2 1 673 332 July 2018 73 356,123,323.61 1.897 1.924 2.318 6 1 676 336 August 2018 80 348,533,173.51 1.967 1.995 2.482 7 1 724 360 September 2018 93 365,168,741.66 2.066 2.094 2.633 14 0 803 434 October 2018 93 349,465,124.75 2.154 2.184 2.694 0 5 787 430 November 2018 102 361,892,606.00 2.235 2.267 2.829 14 1 879 513 December 2018 107 370,471,562.78 2.278 2.309 2.958 6 1 876 502 January 2019 108 384,244,362.54 2.303 2.335 2.940 2 3 850 467 February 2019 107 392,630,366.80 2.317 2.350 2.948 2 0 842 447 March 2019 110 367,666,102.78 2.348 2.380 2.955 3 5 853 462
Average 88 361,040,110.27 2.042% 2.071% 2.577 5 2 771 406
Portfolio CWA2 CC Run Date: 04/10/2019 - 13:00 PM (PRF_PM4) 7.3.0 Page 55 of 146 Report Ver. 7.3.6.1
April 17, 2019
Attention: Administrative and Finance Committee
Approve Capacity Fee Refund to Bosa Development California, Inc. (Action)
Staff recommendation Authorize Acting General Manager to issue a capacity charges refund in the amount of $138,712 to Bosa Development California, Inc.
Alternative recommendation Do not authorize Acting General Manager to issue a capacity charges refund.
Fiscal Impact The net effect will be an increase of $12,837 of capacity charges revenue to the Water Authority. The developer modified their construction plans requiring a different water meter thereby necessitating a higher fee. The original amount paid was $138,712 that is to be refunded in place of a larger amount of $151,549 that also has been paid.
Executive Summary • The Board adopted Ordinance No. 2016-04 granting the General Manager the authority to approve refunding monies previously paid to the Water Authority in an amount not to exceed $100,000. • The Board further stipulated that a refund of capacity charges cannot be made unless the member agency has also refunded its portion of capacity charges, or where required by law. • Bosa Development revised its construction plans requiring a different meter size and paid the City of San Diego capacity fees twice and is requesting a refund for previously paid capacity charges paid to the Water Authority. •
Background Bosa Development California, Inc. (Bosa Development) paid $138,712 for a water meter and associated capacity charges to the City of San Diego (City) for a development project and per normal procedures the City paid those associated capacity charges to the Water Authority in October 2016. In January 2019, Bosa Development revised their construction plans requiring a larger meter resulting additional capacity charges for a higher amount of $151,549. Per the City of San Diego methodology for collecting capacity charges, the developer is required to request a refund of the original capacity fees of $138,712 paid in October 2016 and pay the new fees of $151,549 for the larger meter. Upon receipt of the refund request from the City of San Diego, and Water Authority board approval, the Water Authority will refund the original capacity fees paid in 2016.
Page 56 of 146 Administrative and Finance Committee April 17, 2019 Page 2 of 2
Discussion The Water Authority’s member agencies collect capacity charges on behalf of the Water Authority and remit those monies by the last day of the month following each quarter. In addition, Member agencies receive refund requests for over-paid capacity charges and submit those requests to the Water Authority for payment. The Water Authority received a refund request from the City of San Diego on behalf of Bosa Development in March 2019. Water Authority staff reviewed the refund request documents from the City as well as Water Authority records for proof of payment in October 2016 and had communications with Bosa Development as documentation supporting the recommendation for a refund of $138,712 to Bosa Development.
The Water Authority is due to receive the project’s new capacity fees of $151,549 by April 30, 2019 in accordance with our payment policy terms. The net fiscal impact is an increase in revenue to the Water Authority of $12,837.
Prepared by: Christopher Woidzik, CPA, Controller Reviewed by: Lisa Marie Harris, Director of Finance/Treasurer Approved by: Dan Denham, Assistant General Manager
Page 57 of 146
April 17, 2019
Attention: Administrative and Finance Committee
Microsoft Office 365 Renewal. (Action)
Staff recommendation Authorize the General Manager to execute an agreement with SoftwareOne in the amount of $448,571 to renew the Water Authority’s Microsoft Office 365 software licenses and provide related Microsoft services for a three-year period ending in May 2022.
Alternative Do not approve the agreement and direct staff to use available funding in the current budget to secure a one-year Microsoft Office 365 licenses renewal ending in May 2020. This alternative would likely lead to increased costs to renew the licenses for this year and future years due to the loss of the discounted three-year rate currently available under cooperative procurement and expected increases in renewal prices in coming years.
Fiscal Impact Funds in the amount of $149,523 to cover the first year of the agreement, through May 2020, are currently available in the General Manager’s Adopted Budget for Fiscal Years 2018 and 2019. Funds to cover the remaining two years of the three-year agreement will be included in the General Manager’s Recommended Budget for Fiscal Years 2020 and 2021 and would be contingent on Board approval. The rate category is Customer Service.
Executive Summary To continue using the Microsoft Office 365 software, the Water Authority needs to renew its Microsoft Enterprise Agreement before licenses expire in May 2019. Office 365 provides access to email, intranet, extranet, secure file sharing, desktop applications, and other vital software used throughout the organization. The licenses ensure the software is continually supported with updates, patches and related services to maximize functionality and information security. Staff secured terms for a three-year renewal for $448,571 through a cooperative purchasing agreement with the County of Riverside. Funding for the first year is available in the current budget; funds for the second and third years would be included in the recommended FYs 2020-21 budget.
Discussion The Water Authority provides many of its essential business software services such as email and Office applications used throughout the organization via licensed Microsoft products. These products, typically secured through a licensed service provider via a Microsoft Enterprise Agreement, provide continuity of business services, security and ongoing software support to maximize reliable availability and functionality for the agency.
Page 58 of 146 Administrative and Finance Committee April 17, 2019 Page 2 of 2
In May 2016, Riverside County secured an agreement with SoftwareOne to provide Microsoft licensing following a competitive bidding process. SoftwareOne is a private consulting firm that specializes in helping businesses and public agencies procure and manage their business software. Through a cooperative procurement agreement, the Water Authority is able to renew its Microsoft Enterprise Agreement with SoftwareOne under the same terms as Riverside County’s agreement. This will achieve significant cost savings compared to securing the renewals at current rates. The three-year agreement also enables the Water Authority to lock in pricing until 2022, avoiding the risk of price increases.
The Water Authority’s SoftwareOne agreement includes Microsoft Office 365 licenses for all Water Authority employees, conference room equipment and mobile devices. The agreement also includes software licenses for the agency’s Windows server environments, which run critical business system applications such as PeopleSoft, OnBase records management and water billing software.
Along with the software licenses that enable day-to-day operations for employees, the agreement includes Enterprise Mobile Security for the remote management of all Water Authority devices, advanced threat protection, data loss prevention, and cloud-based email backup. These services enable staff to centrally manage devices and improve monitoring for security threats.
Prepared by: Matthew Bartolome, Acting Information Systems Manager Dan Constantineau, Information Security Officer Reviewed by: Jason Foster, Director of Administrative Services Approved by: Dan Denham, Assistant General Manager
Page 59 of 146
April 17, 2019
Attention: Administrative and Finance Committee
Preliminary Assessments for Calendar Year (CY) 2020 Rates and Charges. (Presentation)
Purpose The presentation will provide a preliminary assessment of the CY 2020 rates and charges. The information is intended to provide guidance to member agencies in developing their upcoming budgets. On April 16th, a preliminary presentation was made to a joint collection of the Member Agency General Managers and Member Agency Finance Officers.
Based on feedback received, Proposed CY 2020 Rates and Charges will be presented at the May Board meeting and the time and place of the public hearing for the Proposed CY 2020 Rates and Charges will be set. In coordination with the May Board meeting, Carollo Engineers (the Water Authority’s rate consultant) will provide a Draft CY 2020 Cost of Service Report. At the June Board meeting, the public hearing will be held, and the Board will take action on the Proposed CY 2020 Rates and Charges.
Prepared by: Pierce Rossum, Rate & Debt Manager Reviewed by: Lisa Marie Harris, Director of Finance/Treasurer Approved by: Dan Denham, Assistant General Manager
Page 60 of 146
April 17, 2019
Attention: Administrative and Finance Committee
Innovation Program Update (Presentation)
Purpose This presentation provides an update on the Water Authority’s Innovation Program.
Discussion The Water Authority’s Innovation Program provides structure and processes to identify creative ideas, which assist the Water Authority in meeting our goals. The Innovation Program fosters a supportive organizational environment to identify and implement ideas ranging from optimizing existing business practices to implementing game-changing transformative innovation.
This presentation will provide an Innovation Program overview, including a status update of the Bright Ideas Program and our external outreach efforts.
Prepared by: Gary W. Bousquet, Deputy Director of Engineering Approved by: Sandra L. Kerl, Acting General Manager
Page 61 of 146
April 17, 2019
Attention: Administrative and Finance Committee
Controller’s Report on Monthly Financial Activity. (Information)
Purpose The purpose of the Controller’s Report is to provide summarized financial information on a monthly basis to the Board of Directors.
Financial Information Attached for review by the Administrative and Finance Committee and the Board of Directors are the following financial documents comprising the Controller’s Report:
1. Water Sales Volumes, in acre-feet 2. Water Sales Revenues, in millions 3. Water Purchases and Treatment Costs, in millions 4. Budget Status Report 5. Schedule of Cash and Investments
A summary of the Fiscal Years 2018 and 2019 Budget Status Report (in millions) for the twenty- month period of July 1, 2017 through February 28, 2019 are as follows:
FY 18 & 19 (20 months - 83%) Budget Period-to-Date Variance [A] [B] [C] [D]=[C / A] FY 18 & 19 Variance Amended Amended Positive/ Budget Budget Actual (Negative) % Water Sales $ 1,302.3 $ 1,076.1 $ 1,009.1 $ (67.0) -6% Water Purchases & Treatment 1,029.5 842.0 759.9 82.1 -10% Net Water Sales Revenues 272.8 234.1 249.2 15.1 6% Revenues & Other Income 218.5 175.7 191.2 15.5 9% Total Revenues 491.3 409.8 440.4 30.6 7% Expenses 436.0 363.8 334.6 29.2 -8% Net Revenues Before CIP 55.3 46.0 105.8 59.8 130% CIP Expenses 137.6 119.1 107.5 11.6 -10% Net Fund Withdraws $ (82.3) $ (73.1) $ (1.7) $ 71.4 -98%
Net Revenues after CIP At February 2019, the Water Authority is twenty months into its two-year budget and is showing a favorable variance of $71.4 million in Net Revenues after CIP. The period-to-date budget provided for a withdrawal from fund balance of $73.1 million at this point, but only a withdrawal of $1.7 million has been required. This has been due to a combination of increased revenues and lower expenses caused in part by delays to CIP projects. However, by the end of the full two-
Page 62 of 146 Administrative and Finance Committee April 17, 2019 Page 2 of 4 year budget, an increased amount will have been withdrawn from reserves as there will be large yearend payments to fund the May debt service requirements and CIP program expenses.
The Budget Status Report (Attachment 4) compares actual revenues and expenses, on a budgetary basis, to the period-to-date adopted budget, as amended by the Board. Period-to-date budgeted amounts for the twenty-month period are presented on a straight-line basis unless adjusted for the timing of periodic items, as noted on Attachment 4 footnote (o). Water sales and water purchases are budgeted based on projected monthly volume in acre-feet.
Net Water Sales Revenue Net Water Sales Revenue is the Water Authority’s principal source of revenue and is the difference between the sale of water and the cost of that water. Sales include revenues from variable commodity charges for supply, treatment and transportation, as well as from fixed charges for customer service, storage, infrastructure access charge, and supply reliability. Cost of water includes payments to three water suppliers: Metropolitan Water District (MWD), IID, and Poseidon Resources (Channelside) LP.
Net Water Sales Revenue was $249.2 million, or 6 percent higher than the budgeted amount of $234.1 million. Actual Water Purchase and Treatment Costs were lower than budgeted by 10 percent due to lower than projected water sales of 6 percent. Detailed information relating to Net Water Sales Revenue is described below and shown on Attachments 1, 2, and 3.
Total acre-feet (AF) of water sold was budgeted at 724,451 AF. Actual water sales volume was 682,746 AF or 6 percent lower than budgeted (Attachment 1). Total Water Sales Revenue was $1,009.1 million or 6 percent lower than the budget of $1,076.1 million (Attachment 2). Lower water sales volume can be attributed to two primary factors: 1) the commencement of deliveries through the Indian Water Authority to Vista and Escondido that directly offset budgeted sales to those agencies and 2) greater than projected member agency use of local surface water supplies.
Total Water Purchases and Treatment costs were budgeted at $842.0 million. Actual costs were $759.9 million or 10 percent lower than budgeted (Attachment 3). This cost category included $134.6 million for 206,666 AF of water purchased from IID, $148.1 million for MWD’s conveyance charges related to IID, Coachella Canal and All-American Canal water, and $170.9 million of water purchased from Poseidon Resources (Channelside) LP. The primary driver for the variance is the shutdown that occurred at the Plant in the summer of 2017 (FY18) for 53 days due to a mechanical coupling failure and resulted in replacement water purchases from MWD. In addition, when the Plant is not producing at levels required by the Water Purchase Agreement, Poseidon is obligated to make a shortfall payment. A provision exists in the Water Purchase Agreement that allows Poseidon to make up for shortfalls within the fiscal year, but they were not able to make up the cumulative difference by the end of Fiscal Year 2018. In Fiscal Year 2019, however, Poseidon has been delivering water as requested.
Revenues and Other Income As shown in Attachment 4, total Revenues and Other Income were budgeted at $175.7 million for the twenty-month period ended February 28, 2019. Actual revenues were $191.2 million or 9 percent higher than budget.
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Actual revenues materially higher than the period-to-date budget are as follows: • Capacity Charges: $12.8 million higher than budgeted due to a greater number of permits issued than anticipated because of several major housing developments in San Diego, Santee, and Escondido • Other Income: $10.1 million more than budgeted due to shortfall revenue related to the Claude “Bud” Lewis Carlsbad Desalination Plant of $7.3 million, $1.9 million of net miscellaneous revenue reimbursements received, and an insurance refund for the Emergency and Carryover Storage Project of $0.9 million
Actual revenues materially lower than the period-to-date budget are as follows: • Grant Reimbursements: $7.9 million lower than budgeted due to grantee project startup delays, for new projects and longer completion schedules for projects underway related to the Integrated Regional Water Management Program (IRWMP) • Contributions in Aid of Capital Improvement Program: $1.6 million lower than budgeted as there has been minimal corresponding revenues due to timing of projects • Build America Bonds Subsidy: $1.2 million lower than budgeted due to subsidies reduced by Congressionally-mandated sequestration rates
Expenses As shown in Attachment 4, total Expenses were budgeted at $363.8 million for the twenty-month period ended February 28, 2019. Actual expenses were $334.6 million or 8 percent lower than budget.
Actual expenses materially lower than the period-to-date budget are as follows: • Debt Service: $15.6 million lower than budgeted due to the timing of payments • Grant Expenses: $9.0 million lower than budgeted due to project delays as noted with corresponding grant revenues • Operating Departments: $3.8 million below budgeted due to vacant staff position savings and lower professional and technical services costs from the timing of projects
Actual expenses materially higher than the period-to-date budget are as follows: • Other Expenses: $1.3 million more than budgeted and contributing to the variance are project costs related to the following two projects: (1) $886,880 to construct the Mission Trails Chlorine Injection structure to treat water and (2) $625,741 of design, procurement and construction costs to install a low-flow meter requested by the Water Authority to reduce the quantity of treated water flow received from the Metropolitan Water District’s Skinner Water Treatment Plant
CIP Expenses Attachment 4 shows CIP Expenses were budgeted at $119.1 million through February but actual expenses amounted to $107.5 million or 10 percent lower than budget. This was due to project work delays as well as contractors revising their timing schedule for invoice submission. However, budgeted CIP program expenses in total are projected to be within a few million dollars under the two-year budget total.
Page 64 of 146 Administrative and Finance Committee April 17, 2019 Page 4 of 4
Cash and Investments As of February 28, 2019, the Water Authority’s cash and investments balance was $392.8 million, approximately 75 percent unrestricted funds with the remaining 25 percent of funds restricted for specific purposes. To maximize investment returns, the Water Authority Treasurer pools the cash of the Pay-As-You-Go Fund with total unrestricted funds. For additional information, see the Schedule of Cash and Investments (Attachment 5).
Prepared by: Jocelyn Matsuo, Senior Accountant Reviewed by: Geena Xiaoqing Balistrieri, CPA, Accounting Supervisor Approved by: Christopher Woidzik, CPA, Controller
Attachments: Attachment 1 – Water Sales Volumes Attachment 2 – Water Sales Revenues Attachment 3 – Water Purchases and Treatment Costs Attachment 4 – Budget Status Report Attachment 5 – Schedule of Cash and Investments
Page 65 of 146 Attachment 1
WATER SALES VOLUMES (in Acre-Feet) Budget Versus Actual for the 20 Months Ended February 28, 2019 Budget 800,000 724,451 AF
700,000 ‐6%
600,000 Actual 500,000 682,746 AF
400,000
300,000 Acre-Feet (AF) 200,000
100,000
-
*Budget (a) Actual
*Budgeted amounts are based on the Adopted Multi-Year Budget for Fiscal Years 2018 and 2019.
Fiscal Year 2018 Cumulative Water Sales (AF) Months Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 *Budget (a) 50,172 100,133 144,944 183,572 214,851 242,655 266,443 288,214 315,331 348,044 386,055 431,353 Actual 41,812 85,217 124,748 166,200 199,748 222,937 247,082 271,036 292,608 325,042 360,219 399,826 AF Difference (b) (8,360) (14,916) (20,196) (17,372) (15,103) (19,718) (19,361) (17,178) (22,723) (23,002) (25,836) (31,527) Cum. Actual AF % Difference (b/a) -17% -15% -14% -9% -7% -8% -7% -6% -7% -7% -7% -7%
Fiscal Year 2019 Cumulative Water Sales (AF) Months Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 *Budget (a) 50,735 101,256 146,963 186,363 218,268 246,628 270,892 293,098 320,758 354,125 393,337 439,980 Actual 48,357 101,940 147,252 185,585 222,989 247,584 266,872 282,920 - - - - AF Difference (b) (2,378) 684 289 (778) 4,721 956 (4,020) (10,178) Cum. Actual AF % Difference (b/a) -5%1%0%0%2%0%-1%-3%
FY19 through FY18 Feb-19 Total Budget 431,353 293,098 724,451 Actual 399,826 282,920 682,746 Difference (31,527) (10,178) (41,705)
% Difference -7% -3% -6%
Page 66 of 146 Attachment 2
WATER SALES REVENUES (in Millions $) Budget Versus Actual for the 20 Months Ended February 28, 2019
Budget $1,200.0 $1,076.1
$1,000.0 ‐6%
Actual $800.0 $1,009.1
$600.0 in Millions $ Millions in $400.0
$200.0
$-
*Budget (a) Actual
*Budgeted amounts are based on the Adopted Multi-Year Budget for Fiscal Years 2018 and 2019.
Fiscal Year 2018 Cumulative Water Sales (in Millions $) Months Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 *Budget (a) 68.0$ $ 135.9 $ 197.7 253.0$ 300.1$ 343.5$ $ 383.5 $ 421.3 $ 464.8 514.8$ $ 570.7 $ 635.1 Actual 58.2 117.8 173.2 230.9 278.4 317.1 357.1 397.0 433.6 482.7 535.0 591.8 Difference (b) $ (9.8) $ (18.1) $ (24.5) $ (22.1) $ (21.7) $ (26.4) $ (26.4) $ (24.3) $ (31.2) $ (32.1) $ (35.7) $ (43.3) Cum. Actual % Difference (b/a) -14% -13% -12% -9% -7% -8% -7% -6% -7% -6% -6% -7%
Fiscal Year 2019 Cumulative Water Sales (in Millions $) Months Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 *Budget (a) 71.1$ $ 141.9 $ 206.9 264.9$ 314.2$ 359.5$ $ 401.4 $ 441.0 $ 486.7 539.3$ $ 598.7 $ 667.2 Actual 67.2 139.4 202.3 257.6 312.1 351.7 385.9 417.3 - - - - Difference (b) $ (3.9) $ (2.5) $ (4.6) $ (7.3) $ (2.1) $ (7.8) $ (15.5) $ (23.7) Cum. Actual % Difference (b/a) -5% -2% -2% -3% -1% -2% -4% -5%
FY19 through FY18 Feb-19 Total Budget 635.1$ $ 441.0 $ 1,076.1 Actual 591.8 417.3 1,009.1 Difference $ (43.3) $ (23.7) $ (67.0)
% Difference -7% -5% -6%
Page 67 of 146 Attachment 3
WATER PURCHASES AND TREATMENT COSTS (in Millions $) Budget Versus Actual for the 20 Months Ended February 28, 2019 Budget $900.0 $842.0 $800.0 ‐10% $700.0 Actual $600.0 $759.9 $500.0 $400.0 in Millions $ Millions in $300.0 $200.0 $100.0 $-
*Budget (a) Actual
*Budgeted amounts are based on the Adopted Multi-Year Budget for Fiscal Years 2018 and 2019.
Fiscal Year 2018 Cumulative Cost of Water Purchases and Treatment (in Millions $) Months Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 *Budget (a) 53.9$ $ 107.6 $ 155.6 198.5$ $ 233.8 265.8$ $ 296.6 325.9$ $ 359.4 398.8$ 443.1$ $ 495.1 Actual 44.9 87.4 124.7 168.6 203.6 232.9 263.8 295.8 324.5 358.4 397.2 442.4 Difference (b) $ (9.0) (20.2)$ $ (30.9) (29.9)$ $ (30.2) (32.9)$ (32.8)$ $ (30.1) $ (34.9) (40.4)$ $ (45.9) $ (52.7) Cum. Actual % Difference (b/a) -17% -19% -20% -15% -13% -12% -11% -9% -10% -10% -10% -11%
Fiscal Year 2019 Cumulative Cost of Water Purchases and Treatment (in Millions $) Months Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 *Budget (a) 56.2$ $ 112.2 $ 163.0 208.4$ $ 246.0 280.3$ $ 314.4 346.9$ $ 384.1 427.6$ 476.8$ $ 534.4 Actual 48.3 102.5 150.2 193.7 232.0 265.0 293.2 317.5 - - - - Difference (b) $ (7.9) (9.7)$ $ (12.8) (14.7)$ $ (14.0) (15.3)$ (21.2)$ (29.4)$ Cum. Actual % Difference (b/a) -14% -9% -8% -7% -6% -5% -7% -8%
FY19 through FY18 Feb-19 Total Budget 495.1$ $ 346.9 $ 842.0 Actual 442.4 317.5 759.9 Difference $ (52.7) (29.4)$ (82.1)$
% Difference -11% -8% -10%
Page 68 of 146 Attachment 4
San Diego County Water Authority Fiscal Years 2018 and 2019 Budget Status Report For the 20 Months Ended February 28, 2019 Unaudited
[A] [B] [C] Revenues = [-B + C] [C / A] Expenses = [B - C] FY 2018 & 2019 (20 months - 83%) FY 2018 & 2019 20 Months 20 Months Actual to Amended Period-to-Date Period-to-Date Variance FY 2018 & 2019 Budget Amended Budget (a) Actual Positive (Negative) Amended Budget Net Water Sales Revenue Water Sales $ 1,302,329,168 $ 1,076,084,473 (b)$ 1,009,128,339 $ (66,956,134) 77% Water Purchases & Treatment 1,029,543,474 842,008,137 (b) 759,939,645 82,068,492 74% Total Net Water Sales Revenue 272,785,694 234,076,336 249,188,694 15,112,358 91%
Revenues and Other Income Infrastructure Access Charges 67,991,290 56,153,244 54,600,524 (1,552,720) 80% Property Taxes and In-Lieu Charges 25,360,573 (c) 20,580,929 (o) 22,625,141 2,044,212 89% Investment Income 10,421,636 (d) 7,798,190 (o) 10,113,452 2,315,262 97% Hydroelectric Revenue 7,105,700 (e) 5,927,369 (o) 6,604,734 677,365 93% Grant Reimbursements 26,635,000 21,052,500 (o) 13,185,235 (7,867,265) 50% Build America Bonds Subsidy 22,605,916 18,838,263 17,598,708 (l) (1,239,555) 78% Other Income 985,432 737,098 (o) 10,846,623 10,109,525 1101% Capital Contributions: Capacity Charges 33,423,807 (f) 25,026,284 (o) 37,801,258 12,774,974 113% Water Standby Availability Charges 22,244,752 (g) 17,903,759 (o) 17,773,861 (129,898) 80% Contributions in Aid of Capital Improvement Program (CIP) 1,683,012 (h) 1,645,260 16,000 (1,629,260) 1% Total Revenues and Other Income 218,457,118 175,662,896 191,165,536 15,502,640 88%
Total Revenues 491,242,812 409,739,232 440,354,230 30,614,998 90%
Expenses Debt Service 280,945,000 (i) 231,407,920 215,805,582 15,602,338 77% QSA Mitigation 18,829,481 (j) 18,829,481 (o) 18,829,481 - 100% Equipment Replacement 4,855,000 4,039,360 1,986,314 2,053,046 41% Grant Expenses 27,135,000 22,576,320 13,543,319 9,033,001 50% Other Expenses 1,000,000 832,000 2,174,443 (1,342,443) 217% Operating Departments (see below) 103,202,095 (k) 86,094,745 82,250,987 3,843,758 80% Total Expenses 435,966,576 363,779,826 334,590,126 29,189,700 77% Net Revenues Before CIP $ 55,276,236 $ 45,959,406 $ 105,764,104 $ 59,804,698 191%
CIP Expenses* $ 137,617,918 (m) $ 119,071,235 (o) $ 107,482,744 $ 11,588,491 78%
Net Fund Withdraws $ (82,341,682) (n) $ (73,111,829) $ (1,718,640) (n) $ 71,393,189
*(CIP Expenses are all funded by Pay-As-You-Go Fund)
Operating Departments Detail Administrative Services $ 11,917,782 $ 9,942,225 $ 9,281,802 $ 660,423 78% Colorado River Program 3,393,607 2,831,064 2,287,943 543,121 67% Engineering 7,656,312 6,387,159 5,539,238 847,921 72% Finance 5,049,185 4,212,204 3,935,761 276,443 78% General Counsel 6,775,956 5,652,736 4,164,048 1,488,688 61% General Manager & Board of Directors 9,197,614 7,672,967 6,945,174 727,793 76% MWD Program 4,286,992 3,576,356 3,334,374 241,982 78% Operations & Maintenance 38,775,860 32,348,159 28,737,073 3,611,086 74% Public Outreach and Conservation 8,136,211 6,787,508 5,372,200 1,415,308 66% Water Resources 8,012,576 6,684,367 6,002,687 681,680 75% Additional Pension Expense - - 6,650,687 (p) (6,650,687) --- Total Operating Departments $ 103,202,095 $ 86,094,745 $ 82,250,987 $ 3,843,758 80%
Page 69 of 146 San Diego County Water Authority Fiscal Years 2018 and 2019 Budget Status Report For the 20 Months Ended February 28, 2019
Notes to the Budget Status Report:
a) Period-to-date budgeted amounts are 20/24ths (83%) of Fiscal Years 2018 and 2019 amended budget unless noted. b) Water sales and water purchases period-to-date budgeted amounts are based on projected acre-feet calculated per month. c) Property taxes are primarily received in December and April. In-lieu charges in the amount of $559,402 for Fiscal Year 2018 and $596,454 for Fiscal Year 2019 are received quarterly from the City of San Diego. d) Investment income excludes unrealized gains/losses, which are non-cash transactions. e) Hydroelectric revenue budget amount includes Rancho Penasquitos Pressure Control and Hydroelectric Facility (Rancho Hydro) and Lake Hodges Pumped Storage Facility (Hodges Hydro). Power generating from both locations are sold to San Diego Gas and Electric. f) Capacity charges are primarily received in July, October, January and April, after the quarterly period ends, and accrued revenue are recorded for the quarter ending June. g) Water standby availability charges are primarily received in January and May. h) Contributions in aid of capital improvement program include planned reimbursements for miscellaneous projects. i) Bonds and Certificates of Participation debt service payments are due semi-annually on November 1 and May 1. Pipeline Bonds, Series 2019 debt service payments are due semi-annually on July 1 and January 1. Debt Service includes principal, interest expense, and debt service fees. Amortization expense relating to long-term debt, such as discounts, premiums, and deferred gain/loss on refunding are excluded because they are non-cash transactions. Short-term debt for Commercial Paper are paid monthly. j) The QSA mitigation payments includes: QSA JPA Fiscal Year 2018 contributions of $1,850,000 is due in July 2017 and $8,314,814 is due in December 2017; QSA JPA Fiscal Year 2019 contributions of $1,750,000 is due in July 2018 and $6,914,667 is due in December 2018. k) Amounts include capital equipment purchases included in the project budget and not funded through the Equipment Replacement Fund. l) The semi-annual subsidy payments from the United States Treasury equal to 35 percent of the interest payable on the Series 2010B Bonds were reduced under Congressionally-mandated sequestration. m) In June 2018, the Board amended the Capital Improvement Program two-year appropriation by an increase of $19.0 million. n) Includes withdraws from fund balances. o) Period-to-date budgeted amounts adjusted based on items occurring on a periodic basis. p) FY18 Actuarial amounts related to pension expense for measurement period ended June 30, 2017.
Page 70 of 146 San Diego County Water Authority Attachment 5 Schedule of Cash and Investments As of February 28, and January 31, 2019 Unaudited
February January Target Operating Fund$ 138,013,463 $ 129,351,700 $ 85,596,000 Equipment Replacement Fund 323,976 380,728 Rate Stabilization Fund 156,767,538 156,637,820 $ 147,000,000
Total Unrestricted Funds (1) 75% 295,104,977 72% 286,370,248
Pay-As-You-Go Fund (1) 75,741,799 86,568,135 Debt Service Reserve Funds 21,973,525 22,820,331 Total Restricted Funds 25% 97,715,324 28% 109,388,466
Total Cash and Investments$ 392,820,301 $ 395,758,714
Discretionary Fund Balances As of February 28, 2019 $250,000,000 $211,200,000 $200,000,000 $156,767,538 $138,013,463 $147,000,000 $150,000,000
$100,000,000 $85,596,000
$50,000,000 $- $- Operating Fund Rate Stabilization Fund Balance Target Maximum
Note: (1) Total Unrestricted Funds and the Pay-As-You-Go Fund represent the Pooled Funds in the Treasurer's Report.
Reserve Fund Categories Operating Fund: The Water Authority's working capital and emergency operating reserve. The Operating Fund's policy requires a maximum of 45 days of average annual operating expenses to be kept in reserves as assessed on an annual basis. Stored Water Fund (SWF): This fund provides working capital to purchase water inventory necessary to fully utilize the Water Authority's storage facilities. A 70,000 acre-feet target was established for Carryover Storage inventory along with a maximum of 100,000 acre-feet, which is the storage capacity. The SWF is to only hold a cash position if the cost to replace the target amount is below the current value of water inventory in the fund. Equipment Replacement Fund (ERF): The ERF is funded by transfers from the Operating Fund for capital equipment purchases such as computers, vehicles, and SCADA systems and is used to replace equipment which has reached the end of its effective useful life. Rate Stabilization Fund (RSF): The RSF holds the water revenues greater than expenditures in years of strong water sales. Funds can then be used to mitigate "rate shock" in years of weak water sales and/or to manage debt service coverage. The RSF target balance is equal to the financial impact of 2.5 years of wet weather or mandatory restrictions and the maximum fund balance is equal to the financial impact of 3.5 years of wet weather or mandatory restrictions. The current balance in this fund represents approximately 107% of the targeted value of $147.0 million and 74% of the maximum balance of $211.2 million. Pay-As-You-Go Fund (PAYGO): The PAYGO fund collects Capacity Charges and Water Standby Availability Charges to be used to pay for the cash portion of the CIP. The funds are dedicated for construction outlays as well as debt service. Debt Service Reserve Fund: This fund contains the required legal reserve for Water Authority debt issues. Such reserves are held for the purpose of making an issue's annual debt service payments in the event the Water Authority should be unable to make such payments. The funds are held by trustees and interest earned is transferred into the Operating Fund and is not restricted. Page 71 of 146 BOARD CALENDAR
MAY 2019 • 08 MWD Delegates meeting at 11:00 a.m. • 09 No Special Board Meeting (ACWA Spring Conference May 7 – 10, Monterey) • 23 Committees begin at 9:00 a.m. Formal Board meeting begins at 2:30 p.m.
JUNE 2019 • 05 MWD Delegates meeting at 11:00 a.m. • 11 Special Administrative & Finance Committee Meeting re: Budget Workshop - 1:30 to 4:00 p.m. • 13 Special Administrative & Finance Committee Meeting re: Budget Workshop - 1:30 to 4:00 p.m. • 27 Committees begin at 9:00 a.m. Formal Board meeting begins at 2:30 p.m.
JULY 2019 • 03 MWD Delegates meeting at 11:00 a.m. • 11 Tentative Special Board Meeting • 25 Committees begin at 9:00 a.m. Formal Board meeting begins at 2:30 p.m.
Page 72 of 146 /JA. Our Region's Trusted Water Leader \W San Diego County Water Authority
April 17, 2019
Attention: Administrative and Finance Committee
CLOSED SESSION: Conference with the Labor Negotiator Government Code §54957.6 Agency Designated Representatives: Gretchen Spaniol, Jason Foster, Liana Whyte, Rick Bolanos Employee Organization: Teamsters Local 911
Purpose The Acting General Manager has asked that a closed session be scheduled, pursuant to Government Code §54957 .6, to discuss the above-referenced matter at the April 25, 2019 meeting.
A closed session has also been included on the agenda of the formal Board of Directors' meeting. Unless the Board desires additional discussion, it is not staffs intention to ask for a closed session with the full Board at that time, but staff may request action to confirm directions given or action recommended by the committee.
Prepared by: Mark J. Hattam, General Counsel rtJ-lf
Page 73 of 146
IMPORTED WATER COMMITTEE
AGENDA FOR
APRIL 25, 2019
Keith Lewinger – Chair Michael Hogan David Barnum – Vice Chair Jim Madaffer David Cherashore – Vice Chair John Masson Betty Evans Ron Morrison Lois Fong-Sakai Jose Preciado Christy Guerin Elsa Saxod Matt Hall Joel Scalzitti
1. Roll call – determination of quorum.
2. Additions to agenda (Government Code Section 54954.2(b)).
3. Public comment – opportunities for members of the public to address the Committee on matters within the Committee’s jurisdiction.
4. Chair’s report. 4-A Directors’ comments.
I. CONSENT CALENDAR
II. ACTION/DISCUSSION/PRESENTATION
1. MWD Issues and Activities Update.
1-A Metropolitan Water District Delegates Report. MWD Delegates (Discussion) (Supplemental Materials)
2. Colorado River Programs.
2-A Colorado River Board Representative’s report. Doug Wilson (Discussion)
2-B Colorado River hydrology update. (Presentation) Kara Mathews
III. INFORMATION
1. Metropolitan Water District Program Report. Amy Chen
Page 74 of 146
IV. CLOSED SESSIONS
1. Conference with Legal Counsel – Existing Litigation Mark Hattam Government Code §54956.9(d)(1) SDCWA v. Metropolitan Water District of Southern California; San Francisco Superior Court Case Nos. CPF-10- 510830; CPF-12-512466; CPF-14-514004; CPF-16-515282; CPF-16-515391; CGC-17-563350; CPF-18-516389; California Court of Appeal (1st District) Case Nos. A146901; A148266; A154325; California Supreme Court Case Nos. S243500; and S251025
2. Conference with Legal Counsel – Existing Litigation Mark Hattam Government Code §54956.9(d)(1) California Department of Water Resources v. All Persons Interested; Sacramento Superior Court Case No. 34-2017- 00215965-CU-MC-GDS; and JCCP 4942
3. Conference with Legal Counsel – Existing Litigation Mark Hattam Government Code §§54956.9(d)(1) Food & Water Watch and Center for Food Safety v. Metropolitan Water District of Southern California and All Persons Interested in the Matter; Los Angeles Superior Court Case No. BC 720692
V. ADJOURNMENT
Melinda Nelson Clerk of the Board
NOTE: This meeting is called as an Imported Water Committee meeting. Because a quorum of the Board may be present, the meeting is also noticed as a Board meeting. Members of the Board who are not members of the Committee may participate in the meeting pursuant to Section 2.00.060(g) of the Authority Administrative Code (Recodified). All items on the agenda, including information items, may be deliberated and become subject to action. All public documents provided to the committee or Board for this meeting including materials related to an item on this agenda and submitted to the Board of Directors within 72 hours prior to this meeting may be reviewed at the San Diego County Water Authority headquarters located at 4677 Overland Avenue, San Diego, CA 92123 at the reception desk during normal business hours.
Page 75 of 146
April 17, 2019
Attention: Imported Water Committee
Colorado River Board Representative’s report. (Discussion)
Purpose The Colorado River Board (CRB) Representative’s report summarizes monthly activities of the Colorado River Board of California.
Discussion This report covers activities from the April 9, 2019 CRB meeting in Ontario, California. The meeting included the following program and status reports:
Agency Updates California Department of Water Resources reported that the majority of California reservoirs are at or above average levels. Los Angeles Department of Water and Power (LADWP) reported that precipitation in the Eastern Sierra increased to 172 percent of normal. Metropolitan Water District of Southern California (MWD) reported that deliveries to member agencies have been increasing after the significant decrease in February.
Drought Contingency Plan (DCP) Update Representatives of the seven Colorado River Basin States met March 19 in Phoenix, Arizona to sign a seven-states letter that accompanied the submittal of proposed federal legislation and the draft interstate DCP agreements to the United States Congress. This proposed federal legislation package was subsequently modified by the House and Senate. Oversight hearings were held on March 27-28 by the Senate Subcommittee on Water and Power and the House Subcommittee on Water, Oceans, and Wildlife regarding the Colorado River Basin DCP. Oral testimony provided to both subcommittees focused on the need to implement the DCP to more effectively manage the Colorado River System and reduce the decline of storage in Lake Powell and Lake Mead. DCP Federal legislation passed April 8 in both the House and Senate. The legislation will now go to the president for signature. Completion of the DCP will trigger a notice to Mexico for implementation of Section IV of Minute 323, Mexico’s Binational Water Scarcity Contingency Plan (BWSCP). The deadline for providing this notice is April 22 so that the BWSCP may be fully effective by the release of the Bureau of Reclamation’s (Reclamation’s) August 2019 24- Month Study Report.
Colorado River Basin Water Report Water supply and storage conditions as of the April 8 Reclamation Weekly Water Supply Report are shown in Table 1. Reclamation completed a draft of its Accounting and Water Use Report for Calendar-Year 2018. Comments on the draft report were submitted to Reclamation on April 8. Additionally, Reclamation released the proposed consultation schedule for the development of the 2020 Annual Operating Plan for Colorado River Reservoirs. The first consultation meeting will be held June 4 via webinar.
Page 76 of 146 Imported Water Committee April 17, 2019 Page 2 of 2
Table 1. Colorado River Reservoir Conditions Conditions as of April 8* Volume (MAF) Percent of Capacity Elevation (feet)
Lake Powell 9.00 37% 3,568.77 Lake Mead 10.84 42% 1,089.85 Total System Storage 26.79 45% --- Water Year 2019 Precipitation 119% of average Upper Colorado River Basin Snowpack 130% of average *Conditions shown are updated from those discussed at the CRB meeting.
Glen Canyon Dam Adaptive Management Program The Technical Work Group of the Glen Canyon Dam Adaptive Management Program met March 12-14 in Phoenix, Arizona to hear Grand Canyon resource status updates. The humpback chub population appears to be stable, but juvenile fish production has been low for several years. Rainbow trout populations have increased significantly since 2014/2015.
Lower Colorado River Multi-Species Conservation Program The Lower Colorado River Multi-Species Conservation Program and the Metropolitan Water District of Southern California will hold a dedication ceremony for the new Dennis Underwood Conservation Area on April 16 in Blythe, California. The new habitat is in the Palo Verde Irrigation District and will include about 600 acres of cottonwood-willow and honey mesquite land-cover types.
Prepared by: Kimberlyn Velasquez, Water Resources Specialist Reviewed by: Mark Watton, Alternate CRB Representative
Page 77 of 146
April 17, 2019
Attention: Imported Water Committee
Colorado River hydrology update. (Presentation)
Purpose This report provides an update on current Colorado River hydrology, reservoir operations, and shortage predictions as well as recent activity on the Drought Contingency Plan (DCP).
Executive Summary In 2019, the Colorado River has experienced very good hydrology with above average conditions throughout the Basin. The Bureau of Reclamation (Reclamation)’s April mid-year review confirms an above average release of 9.0 million acre-feet (MAF) from Lake Powell in 2019. Reclamation’s updated modeling projections indicate there will not be an official shortage in 2020, but there will be DCP contributions if finalized. The DCP is in the final stages of completion and is expected to be implemented as part of 2020 river operations.
Background A combination of hydrology, storage, and other factors are used to determine reservoir operations for Lake Powell and Lake Mead, the two major Colorado River system reservoirs, each year. The current agreement that defines criteria for annual reservoir operations is the “2007 Colorado River Interim Guidelines for Lower Basin Shortages and Coordinated Operations for Lake Powell and Lake Mead” (2007 Interim Guidelines). The 2007 Interim Guidelines balance storage levels between Lake Powell and Lake Mead based on annual runoff projections and existing storage. Annual operating conditions are determined based on hydrologic modeling performed by Reclamation. While Reclamation performs monthly updates, it completes more comprehensive modeling three times a year in January, April, and August. Reclamation’s August projections are the most critical, as they determine operations for these reservoirs for the upcoming calendar year including the release volume from Lake Powell and determination of Lower Basin allocations. For the Lower Basin this includes the determination of whether or not there is an official shortage. In April, a mid-year review is performed which has potential to adjust the annual Lake Powell release volume for the current year based on actual conditions. The August 2018 modeling indicated the release volume from Lake Powell would most likely be 9.0 MAF. The April 2019 modeling officially confirms the release of 9.0 MAF for 2019.
Colorado River allocations have historically been guaranteed, with all states and users receiving their full annual allocations. An official shortage has never been declared on the river, which would result in reduced allocations to Arizona and Nevada, but no cuts to California users due to its higher priority water rights. Shortage criteria and associated reductions to users are defined in the 2007 Interim Guidelines. The Colorado River Basin has been experiencing long-term drought conditions since 2000. This prolonged drought caused the likelihood of a Lower Basin shortage to increase significantly, resulting in the development of an alternative plan known as the DCP, to serve as an overlay to the 2007 Interim Guidelines. The DCP is in the final stages of completion and is expected to be implemented as part of 2020 river operations. The DCP
Page 78 of 146 Imported Water Committee April 17, 2019 Page 2 of 3
includes voluntary volume contributions from all Lower Basin water users to build elevation in Lake Mead and reduce the chance of reaching critically low elevation levels. DCP contributions are separate from and in addition to any shortage cutback volumes. Both shortage cutbacks and DCP contribution volumes are determined by elevation-based trigger levels in Lake Mead.
Discussion In 2019, the Colorado River Basin has experienced above average hydrologic conditions, with snowpack and precipitation reaching record levels in some areas. This year’s improved Upper Basin snowpack at 138 percent of normal and high precipitation at 120 percent of normal have resulted in a projected 2019 water year unregulated inflow to Lake Powell of 12.1 MAF, which is 112 percent of average. Total system storage as of April 15, 2019 is 26.8 MAF or 45 percent of capacity. Storage has decreased during the current drought period, as annual inflows were supplemented with storage reserves to meet annual Colorado River allocations to water users. The storage volumes in Lakes Powell and Mead are coordinated as part of the 2007 Interim Guidelines to balance contents in the two reservoirs via annual releases from Lake Powell determined by projected elevations of both reservoirs. Typically, 8.23 MAF is released from Lake Powell each year, but depending on reservoir conditions, more or less water can be released. Reclamation’s April 2019 modeling confirms the final release volume for 2019 will be an increased release of 9.0 MAF.
Decreases in storage coincide with falling reservoir elevations. In Lake Mead, reservoir levels are particularly important as shortages are determined by elevation-based trigger levels of 1,075 feet, 1,050 feet, and 1,025 feet. These trigger elevations result in defined cuts to annual allocations to certain users. DCP volume contributions are also elevation-based, with the first contributions required at or below Lake Mead elevation 1,090 feet and additional triggers down to 1,025 feet. Table 1 shows the shortage cuts and DCP volumes at each of the elevation levels.
Table 1. Annual Shortage Reductions and DCP Volume Contributions for the Lower Basin States (2007 Interim Guidelines, DCP) and Mexico (Minute 323 Shortage Sharing and Binational Water Scarcity Contingency Plan) Lake Arizona Nevada California BOR Mexico Total Mead (TAF) (TAF) (TAF) (TAF) (TAF) (TAF) Elevation BW- 2007 DCP Total 2007 DCP Total 2007 DCP Total DCP 323 Total (FT) SCP <1,090 - >1,075 0 192 192 0 8 8 0 0 0 100 0 41 41 341 <1,075 – >1,050 320 192 512 13 8 21 0 0 0 100 50 30 80 713 <1,050 - >1,045 400 192 592 17 8 25 0 0 0 100 70 34 104 821 <1,045 - >1,040 400 240 640 17 10 27 0 200 200 100 70 76 146 1,113 <1,040 - >1,035 400 240 640 17 10 27 0 250 250 100 70 84 154 1,171 <1,035 - >1,030 400 240 640 17 10 27 0 300 300 100 70 92 162 1,229 <1,030 - >1,025 400 240 640 17 10 27 0 350 350 100 70 101 171 1,288 <1,025 480 240 720 20 10 30 0 350 350 100 125 150 275 1,475
Page 79 of 146 Imported Water Committee April 17, 2019 Page 3 of 3
A shortage is not automatically triggered when the lake drops to a trigger elevation. Per the procedures in the 2007 Interim Guidelines, an official shortage declaration is based on the projected end-of-year elevation of Lake Mead established in Reclamation’s August modeling results. Similar procedures apply to annual elevation-based volume contributions required under the DCP. Reclamation’s current April 2019 modeling results project that Lake Mead’s elevation will be 1,084 feet on January 1, 2020, which is above the first shortage trigger of 1,075 feet. However, this elevation falls below 1,090 feet and would trigger DCP contributions for Arizona, Nevada, and Mexico,1 assuming the DCP is finalized as expected. This April projection provides an initial estimate for next year’s operations, but the upcoming August update will provide the official determination for 2020 operations. Reclamation’s five-year outlook on the likelihood of a Lower Basin shortage also provides insight on future operations. The five-year outlook is currently being updated and is expected to be released later this month. Based on the improved hydrology, it is expected there will not be a shortage in 2020 and there will be a reduced chance of shortage over the next five years.
Even with the very good hydrologic year for the river, continued drought has heightened concerns regarding long-term supply reliability in the Colorado River Basin. Finalization and subsequent implementation of the DCP will help maintain Lake Mead levels and protect supplies. California does not face reductions in a shortage but would make DCP contributions at some of the lower elevation triggers. The Water Authority’s independent Colorado River supplies are highly reliable and substantially insulated from shortage impacts due to their high priority status within California’s priority water rights system. The Metropolitan Water District of Southern California (MWD) is responsible for the vast majority of DCP contributions for California under the current intrastate DCP agreements. MWD plans to make any required DCP contributions using existing and future stored water in Lake Mead under the Intentionally Created Surplus (ICS) program, as well as interstate water obtained through an agreement with Nevada. The Water Authority has approved supplies eligible for storage in Lake Mead to help the Basin and potentially aid California in meeting its DCP requirements and continues to work towards obtaining an ICS storage account to utilize this benefit.
Prepared by: Kara Mathews, Senior Water Resources Specialist Reviewed by: Kelly Rodgers, Director of the Colorado River Program Approved by: Dan Denham, Assistant General Manager
1 Mexico’s shortage-sharing volume reductions (similar to U.S. shortage cutbacks) and Binational Water Scarcity Contingency Plan (BWSCP) volume contributions (similar to U.S. DCP contributions) are defined in Minute 323.
Page 80 of 146
April 17, 2019
Attention: Imported Water Committee
Metropolitan Water District Program Report (Information)
Purpose This report summarizes activities of interest associated with the Metropolitan Water District of Southern California (MWD) and MWD Member Agencies.
Discussion This section provides a summary of key issues at the April 8 and 9, 2019 meetings of the MWD Board of Directors. The MWD Board will meet next on May 13 and 14, 2019.
Update Language in Demand Management Agreements The MWD Board authorized provisions regarding “the legality in all future demand management agreements and to no longer include or enforce termination provisions in the Local Resources Program (LRP), Seawater Desalination Program (SDP), and similar agreements.” MWD subsidizes various conservation and local supply programs using its Water Stewardship Rate, a partial funding source for these demand management programs (in the past, MWD has also utilized unrestricted reserves and other funds). In 2005, the MWD Board voted to include the “Rate Structure Integrity” (RSI) provision in all demand management agreements, so MWD could terminate agreements if agencies “challenge Metropolitan's existing rate structure via the courts or legislature.” The RSI was subsequently ruled illegal by the court. This month, MWD authorized removing this language from its demand management agreements and replacing it with “payments made by Metropolitan to Agency pursuant to this Agreement are a legal use of Metropolitan’s funds” and “Metropolitan may legally recover the costs incurred by Metropolitan pursuant to this Agreement in the water rates charged to its Member Agencies.” The Water Authority’s General Counsel sent a letter to MWD describing the Water Authority’s support for removing RSI the language included in past agreements but objected to the new language.1 The Water Authority Delegates did not support this item due to this new language being included.
Cyclic Accounts “Cost-Offset Credits” The MWD Board authorized the General Manager to enter into cyclic agreements and provide a “cost-offset credit” of up to $225 per acre-foot for surplus deliveries. Through cyclic agreements, MWD pre-delivers surplus water into cyclic accounts, and participating member agencies purchase the water over a 5-year period. Both groundwater and surface water agencies can participate in the cyclic program. To “remove the financial barrier” for agencies to take in- lieu or direct deliveries, MWD authorized offering a “credit” of up to $225 per acre-foot to cover costs member agencies incur by reducing their use of local supplies and instead taking “surplus” MWD water. For example, groundwater agencies taking MWD water via in-lieu treated water deliveries are eligible to receive a “credit” of up to $225 per acre-foot to offset the additional costs of taking treated MWD water instead of using local groundwater supplies. For surface
1 Water Authority General Counsel’s April 4, 2019 letter found here: https://mwdprograms.sdcwa.org/wp- content/uploads/2019-04-04-Letter-to-MWD-Marcia-Scully-re-Board-Memo-8-6.pdf
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storage, MWD limits the “credit” for evaporative losses to 5 percent annually up to 10 percent over two years. “Credits” would only be given to a member agency under the following conditions: “The MWD General Manager determines that supply conditions warrant making cost- offset credits available due to a risk of not capturing all available imported supplies;” The member agency increases its take of MWD water at “MWD’s request;” MWD staff certifies the water placed in cyclic accounts is “above the baseline operations;” and “The member agency incurs costs to capture these surplus supplies that are above the normal cost that would be paid for imported water supplies from MWD.” The General Manager is “required to bring an item to the next board meeting” after making “credits” through the cyclic program available.
Antelope Valley-East Kern Agency Water Bank Program Agreement The MWD Board authorized an agreement with the Antelope Valley-East Kern Water Agency (AVEK) to store water in the High Desert Water Bank Program (Water Bank).2 Under the program, MWD will provide up to $131 million3 to construct recharge, turnout, and other facilities to allow the monitoring, delivery, and storage of water at the Water Bank. MWD will incur a one-time, 10 percent storage loss. With the capital costs, the recovery fee,4 and other costs, the total estimated project cost is $320 per acre-foot. MWD reported the program has benefits beyond its existing Central Valley banking programs such as larger “put” and “take” capacities (each 70,000 annually), and is located downstream of the Edmonston Pumping Plant, which may make it more accessible during an emergency on the California Aqueduct. MWD can store up to 280,000 acre-feet of its supplies in the Water Bank. While AVEK would own the facilities, MWD would have first priority to use them. The program has a five-year construction period and was not included in MWD’s budget.
The MWD Committees and Board also: Approved resolutions fixing and adopting a Readiness-to-Serve Charge and a Capacity Charge for calendar year 2020 (with the Water Authority Delegates opposing5); Adopted a resolution to support MWD’s application for United States Bureau of Reclamation grant funding of $1.5 million for Disadvantaged Communities Direct Install Program; authorized the General Manager to accept grant funds, if awarded; and authorized the General Manager to enter into a contract with United States Bureau of Reclamation for the grant funds, if awarded; Took no position on SB 1 (Atkins, D-San Diego; Portantino, D-La Canada Flintridge; and Stern, D-Agoura Hills): California Environmental, Public Health, and Workers Defense Act of 2019 and directed staff to negotiate amendments to the bill; Expressed support, if amended, for AB 658 (Eduardo Garcia, D-Coachella): Water Rights: Water Management; Authorized replacement of filter valve gearboxes at the Robert A. Skinner Water Treatment Plant;
2 MWD presented this potential program in September 2018 and January 2019. 3 In 2018 dollars. 4 The recovery fee will be escalated annually based on the Consumer Price Index starting in 2018. MWD will pay a minimum rolling average of $2 million toward the recovery fee per year at the completion of project construction. 5 Water Authority Assistant General Manager’s April 4, 2019 letter found here: https://mwdprograms.sdcwa.org/wp- content/uploads/2019-04-04-Letter-to-MWD-Chair-Gray-re-Board-Memo-8-1-RTS-and-CC.pdf Page 82 of 146 Imported Water Committee April 17, 2019 Page 3 of 3
Authorized a professional services agreement with Sensis, Inc. not to exceed $1,500,000 to design, develop and deploy the new mwdh2o.com website; Awarded a contract to Elite Earthworks & Engineering in an amount not to exceed $3.7 million for repair of erosion control features along the Colorado River Aqueduct; authorize design activities to rehabilitate the Whitewater erosion protection structure; and amend an existing agreement with HELIX Environmental Planning, Inc; Affirmed the General Manager’s determination that 20 acres of vacant land in the City of Oxnard, in the County of Ventura, California are surplus to MWD’s needs and authorized staff to dispose of the property and to quitclaim any associated interests; Appropriated funds for and authorized acquisition of real property located at 4725 Via Corona, Yorba Linda, California; Went into closed session to: o Review settlement proposal received from the Water Authority and receive a report on Water Authority v. MWD (rate litigation); o Receive a security update; o Receive a cybersecurity update; and Approved Commendatory Resolutions for Director Fern Steiner and four other past MWD representatives from various agencies; Heard oral reports on: o SB 332 (Hertzberg, D-Van Nuys; Weiner D–San Francisco) Wastewater treatment: recycled water; o Approaches to Encourage Local Resource Development; o Prefunding PERS and OPEB; o Debt Management; o Existing Bay-Delta and State Water Project Litigation; o Human Resources Discrimination Complaint Procedures; o Conservation Update; o Asset Management Program Overview; o Quarterly Financial Report; o Succession Plan Overview; and o Update on Water Surplus and Drought Management Plan.
Prepared by: Skylar Stephens, Management Analyst Reviewed by: Amy Chen, Director of MWD Program Approved by: Dan Denham, Assistant General Manager
Page 83 of 146
April 17, 2019
Attention: Imported Water Committee
CLOSED SESSION: Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) Name of Case: SDCWA v. Metropolitan Water District of Southern California; San Francisco Superior Court Case Nos. CPF-10-510830; CPF-12-512466; CPF-14-514004; CPF-16-515282; CPF-16-515391; CGC-17-563350; CPF-18-516389; California Court of Appeal (1st District) Case Nos. A146901; A148266; A154325; California Supreme Court Case Nos. S243500; and S251025
Purpose This memorandum is to recommend a closed session, pursuant to Government Code §54956.9(d)(1), to discuss the above-referenced matter at the April 25, 2019 meeting.
A closed session has also been included on the agenda of the formal Board of Directors’ meeting. Unless the Board desires additional discussion, it is not staff’s intention to ask for a closed session with the full Board at that time, but staff may request action to confirm directions given or action recommended by the committee.
Prepared by: Mark J. Hattam, General Counsel
Page 84 of 146
April 17, 2019
Attention: Imported Water Committee
CLOSED SESSION: Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) Name of Case: California Department of Water Resources v. All Persons Interested; Sacramento Superior Court Case No. 34-2017-00215965-CU-MC-GDS; and JCCP 4942
Purpose This memorandum is to recommend a closed session, pursuant to Government Code §54956.9(d)(1), to discuss the above-referenced matter at the April 25, 2019 meeting.
A closed session has also been included on the agenda of the formal Board of Directors’ meeting. Unless the Board desires additional discussion, it is not staff’s intention to ask for a closed session with the full Board at that time, but staff may request action to confirm directions given or action recommended by the committee.
Prepared by: Mark J. Hattam, General Counsel
Page 85 of 146
April 17, 2019
Attention: Imported Water Committee
CLOSED SESSION: Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) Name of Case: Food & Water Watch and Center for Food Safety v. Metropolitan Water District of Southern California and All Persons Interested in the Matter; Los Angeles Superior Court Case No. BC 720692
Purpose This memorandum is to recommend a closed session, pursuant to Government Code §54956.9(d)(1), to discuss the above-referenced matter at the April 25, 2019 meeting.
A closed session has also been included on the agenda of the formal Board of Directors’ meeting. Unless the Board desires additional discussion, it is not staff’s intention to ask for a closed session with the full Board at that time, but staff may request action to confirm directions given or action recommended by the committee.
Prepared by: Mark J. Hattam, General Counsel
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WATER PLANNING AND ENVIRONMENTAL COMMITTEE
AGENDA FOR
APRIL 25, 2019
Tony Heinrichs – Chair Chris Cate Brian Boyle – Vice Chair Jim Desmond Doug Wilson – Vice Chair Kathleen Coates Hedberg Gary Arant Michael Hogan Jimmy Ayala Tom Kennedy David Barnum Keith Lewinger Jack Bebee Ron Morrison Jerry Butkiewicz
1. Roll call – determination of quorum.
2. Additions to agenda (Government Code Section 54954.2(b)).
3. Public comment – opportunities for members of the public to address the Committee on matters within the Committee’s jurisdiction.
4. Chair’s report. 4-A Directors’ comments.
I. CONSENT CALENDAR
II. ACTION/DISCUSSION/PRESENTATION
1. Claude “Bud” Lewis Carlsbad Desalination Plant. Jeremy Crutchfield
1-A Water Purchase Agreement Contract Administration Memorandum Regarding the First Phase of Intake and Discharge System Modifications. Staff recommendation: Authorize the General Manager to execute a Water Purchase Agreement Contract Administration Memorandum (CAM) between the Water Authority and Poseidon Resources (Channelside) LP to support Temporary Stand-Alone Operations of the intake and discharge facilities at the Lewis Carlsbad Desalination Plant (CDP). (Action)
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1-B Resolution to Submit Application under Department of Water Resources Water Desalination Grant Program’s Continuous Application Process. Staff recommendation: Adopt Resolution No. 2019-08 establishing that:
a) The General Manager is authorized to sign and file for, on behalf of the Water Authority, a grant application for funding from the Department of Water Resources Desalination Grant Program (Continuous Application Process) in an amount not to exceed $1,250,000 for the Lewis Carlsbad Desalination Plant (CDP) Wedgewire Screen Demonstration Project.
b) The Water Authority will comply with all applicable state and federal statutory and regulatory requirements related to any federal and state funds received.
c) The General Manager or designee is authorized to negotiate and execute a funding agreement and any amendments thereof, and certify funding disbursements on behalf of the Water Authority. (Action)
2. Update on water supply conditions. (Presentation) Alexi Schnell
3. Update on Senate Bill 606 and Assembly Bill 1668 Implementation. Jeff Stephenson (Presentation)
III. INFORMATION
1. Water Resources Report. Elizabeth Lovsted
IV. CLOSED SESSION
V. ADJOURNMENT Melinda Nelson Clerk of the Board
NOTE: This meeting is called as a Water Planning and Environmental Committee meeting. Because a quorum of the Board may be present, the meeting is also noticed as a Board meeting. Members of the Board who are not members of the Committee may participate in the meeting pursuant to Section 2.00.060(g) of the Authority Administrative Code (Recodified). All items on the agenda, including information items, may be deliberated and become subject to action. All public documents provided to the committee or Board for this meeting including materials related to an item on this agenda and submitted to the Board of Directors within 72 hours prior to this meeting may be reviewed at the San Diego County Water Authority headquarters located at 4677 Overland Avenue, San Diego, CA 92123 at the reception desk during normal business hours.
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April 17, 2019
Attention: Water Planning Committee
Claude “Bud” Lewis Carlsbad Desalination Plant Water Purchase Agreement Contract Administration Memorandum Regarding the First Phase of Intake and Discharge System Modifications (Action)
Staff recommendation Authorize the General Manager to execute a Water Purchase Agreement Contract Administration Memorandum (CAM) between the Water Authority and Poseidon Resources (Channelside) LP to support Temporary Stand-Alone Operations of the intake and discharge facilities at the Lewis Carlsbad Desalination Plant (CDP).
Alternative Do not authorize the General Manager to execute this Water Purchase Agreement CAM and direct staff to work with Poseidon on revising the terms.
Fiscal Impact In accordance with the terms of the Water Purchase Agreement, authorization of this CAM will increase the unit price for desalinated water from the CDP by $135/acre-foot during the Temporary Stand-Alone Operations period, paid only on actual deliveries. Based on 48,000 acre-feet of delivery, the cost increase on an annual basis is $6,462,997. This is included in the calendar year (CY) 2020 rates and charges and results in an increase of approximately one percent on the CY 2020 melded supply rate.
Executive Summary • The transition to new intake and discharge facilities will be implemented through three phases to allow for continual operation of the Lewis Carlsbad Desalination Plant under a revised NPDES permit. Water Purchase Agreement Contract Administration Memorandums will be required for each phase. • The first phase is designated “Temporary Stand-Alone Operations” and utilizes the intake and discharge facilities associated with Encina Power Station’s once-through cooling system for the sole purpose of serving the desalination plant. • The Contract Administration Memorandum for Temporary Stand-Alone Operations applies the same risk transfer as contemplated in the Water Purchase Agreement. • The total annual increase to the purchase price of desalinated water is $6,462,997. • Temporary Stand-Alone Operations began December 12, 2018 and will conclude once the new pump system with fish friendly pumps is constructed by Poseidon (currently anticipated by May 2020).
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Background
The Claude “Bud” Lewis Carlsbad Desalination Plant (CDP) started commercial operations on December 23, 2015. The project is a result of a long-term Water Purchase Agreement (WPA) executed between the Water Authority and Poseidon that was approved by the Water Authority Board on November 29, 2012. This agreement is the basis for the financing, construction and now the operation of the CDP. Under the WPA, the Water Authority agreed to purchase the output of the plant – a minimum of 48,000 acre-feet and up to 56,000 acre-feet of product water from the CDP annually. The Water Authority’s water purchase payments compensate Poseidon for the fixed and variable costs of the CDP including debt service and equity return payments, as well as fixed and variable plant costs for electricity and operations and maintenance (O&M).
The intake facilities for the CDP are currently permitted and configured to draw the Plant’s seawater supply from the Encina Power Station (EPS) once-through cooling water system as shown in Figure 1. In order to comply with the State Water Resources Control Board’s Once- Through Cooling Policy, adopted in 2010, that phases out once-through cooling for power plants, electricity generation operations at the EPS were shut down on December 12, 2018. The EPS was replaced by a new air-cooled power plant, just to the east of the existing EPS. For the near term, Poseidon has reached agreement with NRG Energy (NRG), the owner of the EPS, to temporarily extend the operation of just the cooling water circulation pumps solely to support desalination plant operations (See Intake Phasing section below). Ultimately, NRG’s agreement with the City of Carlsbad (Settlement Agreement) requires complete demolition of the EPS, including the cooling water circulation pumps, by December 2021.
For the long-term, the shutdown of the EPS and its cooling water system will require the construction of new CDP intake and discharge facilities to allow a transition to a “stand-alone” operation of the desalination plant. The intake and discharge system modifications (Modifications) that are required due to closure of the EPS, necessitate a new NPDES permit. In addition, the Modifications are required to comply with the statewide Ocean Plan Amendment (OPA) that addresses desalination facility intakes and discharges, adopted by the State Water Resources Control Board in May 2015.
The transition to stand-alone operations, including the construction of new intake facilities, was contemplated and is addressed in the WPA. The WPA obligates the Water Authority to pay, through adjustments to the Unit Price, for Poseidon’s incremental capital and operating costs associated with stand-alone operations, including the Modifications resulting from the power plant closure and compliance with the OPA. Modifications capital and operating costs eligible for pass-through to the Water Authority, related to closure of the power plant (considered a change in law under the WPA), are capped in the WPA at index-linked amounts. Costs related to compliance with the OPA are also considered “change in law” under the WPA, but are not subject to the same caps as closure-related costs. However, the WPA protects the Water Authority by imposing a cap limiting increases due to changes in law (among other provisions) in the water unit price to 10 percent in any year and a total of 30 percent on an aggregate basis.
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Figure 1. Current Intake and Discharge Flow Schematic
Poseidon is currently pursuing a new NPDES permit for the project with the San Diego Regional Water Quality Control Board (San Diego Water Board) and State Water Resources Control Board (State Water Board). The proposed Modifications will address both the transition to stand-alone operations and compliance with the OPA. The permit is currently scheduled to be considered by the San Diego Water Board at a public hearing on May 8, 2019. A sixth addendum to the Final Environmental Impact Report (FEIR) covering the intake and discharge system modifications considered in the draft permit was finalized on March 26, 2019.
Previous Board Action: The Water Authority Board approved the Water Purchase Agreement on November 29, 2012.
Previous Board Presentation: On March 24, 2016, The Engineering and Operations Committee received a presentation on the Claude “Bud” Lewis Carlsbad Desalination Plant Intake System Modifications.
Previous Board Action: On August 17, 2016, the Board approved a Contract Administration Memorandum (CAM) Regarding the Proposed Intake and Discharge System Modifications for the Claude “Bud” Lewis Carlsbad Desalination Plant Water Purchase Agreement.
Previous Board Action: On August 17, 2016, the Board approved a supplemental EIR for the new intake structure.
Previous Board Action: On December 6, 2018, the Board authorized the General Manager to approve Contract Amendments for Hawkins Delafield & Wood LLP, Clean Energy Capital Securities and Louis Berger Group associated with the Lewis Carlsbad Desalination Plant Intake Modifications Project
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Discussion
Intake Phasing As discussed above, NRG has completed its new air-cooled power plant and ceased energy production at the EPS effective December 12, 2018. In consultation with the Water Authority, the Regional Water Board and NRG, Poseidon is planning a phased implementation of the Modifications that will allow the CDP to remain in service. The three phases are as follows:
1. Temporary Stand-Alone Operations – Poseidon has reached agreement with NRG to allow for the operation of the cooling water circulation pumps by NRG staff to be extended while an interim intake/discharge system is constructed. 2. Interim Operations – Expected to begin in mid 2020, this phase will include a new fish friendly pump system that will be constructed to keep the plant in operation. Pilot studies to confirm the efficacy and operational characteristics of the submerged intake screens will also be conducted and the new, permanent screened-intake system will be designed and constructed on the floor of the Agua Hedionda Lagoon. 3. Permanent Operations – The new submerged, screened-intake system is expected to be connected in early 2024, achieving full compliance with the OPA. See Figure 2.
Figure 2. Permanent Intake and Discharge Flow Schematic
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The remainder of this memorandum will focus on the Temporary Stand-Alone Operations Period, the subject of the requested action.
Temporary Stand-Alone Operations Period (TSOP) Terms and Structure Water Authority staff and Poseidon have negotiated the key terms addressing financial and contractual conditions during the TSOP. These conditions align with the provisions and intent of the Water Purchase Agreement. Key terms and conditions are detailed below.
Risk Transfer In keeping with the provisions of the WPA, a fundamental aspect is the risk transfer to the private sector. As such, risks associated with operation during TSOP belong to Poseidon as the owner/operator of the CDP. Provided that water is produced by Poseidon, the Water Authority will pay a fixed incremental price (substantiated based on recent actual costs) added to each acre-foot produced to compensate Poseidon for the increased cost of operating under the temporary stand-alone condition. With the closure of the EPS, Poseidon is now paying NRG to operate and maintain its existing equipment solely to support desalination plant stand-alone operations. Similar to the pricing structure developed for the WPA, by paying a fixed incremental unit price, the Water Authority is effectively transferring risk to Poseidon. If the costs of operation are higher, that cost is borne by Poseidon.
Duration The TSOP is expected to continue into mid 2020 coinciding with when Poseidon places new, fish-friendly pumps into service, thus beginning the Interim Operations period. Once the Interim Operations phase start date is more clearly defined later this year, the Water Authority and Poseidon may need to discuss with the City of Carlsbad and NRG any schedule/cost impacts related to the EPS demolition plan and schedule. As noted above, the terms of the Settlement Agreement between and among the City of Carlsbad, Carlsbad Municipal Water District, Cabrillo, Carlsbad Energy Center LLC and San Diego Gas & Electric Company currently requires NRG to begin demolition by December 2019 and complete physical demolition and removal of the above-ground structures of the Cabrillo Generating Facility by December 2021.
Cost Components Five separate cost components were established to account for the total cost adjustment necessary to continue operation of the EPS cooling water circulation system through the TSOP. Each component is described below:
Administrative Incremental administrative costs incurred by Poseidon solely related to the TSOP include assessments to establish baseline condition of the existing equipment, oversight of NRG’s operation of the cooling water circulation pumps and ancillary equipment, and limited document processing and controls.
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Electricity The EPS contains an array of high and low capacity pumps designed to convey a much larger flow of water from the lagoon than the 299 million gallons per day necessary to operate the desalination plant at peak capacity, including the required dilution water. While this means there is a substantial amount of available capacity, it also limits the efficiency that the pumps can run at for the flows required at the CDP. Poseidon developed, and Water Authority staff validated, a cost model that shows a pumping scheme using current electricity tariffs to forecast a total cost to run the pumps at a consistent flow to optimize pump efficiency as much as possible.
Operations, Maintenance and Repair The costs for routine operation, maintenance and repair of the cooling water circulation pumps and ancillary equipment during the TSOP are included in the total cost adjustment. These functions are being performed by NRG staff.
Contingency A recent condition assessment of the existing cooling water circulation pumps and ancillary equipment, conducted by Poseidon and reviewed by the Water Authority, concludes that given the age, condition and planned demolition of these EPS facilities, there is a high potential for equipment failure during the TSOP. This assessment produced a probability of failure that was applied to the anticipated cost to repair/replace the equipment.
In order to effectuate the risk transfer to Poseidon, a contingency amount was established to account for extraordinary maintenance events and product water production relief. Extraordinary maintenance includes the repair and/or replacement of essential equipment that goes well beyond standard maintenance that is already captured in the item above.
Water production relief will be provided through the establishment of a new, temporary category of relief that Poseidon could utilize during the TSOP should a mechanical failure occur preventing the intake and discharge facilities from providing feedwater to the desalination plant. During a mechanical failure, Poseidon would be relieved from its production requirement for up to 240 hours (10 days) annually. However, Poseidon would receive no compensation, similar to an excused supply shortfall under the WPA. These hours, if used, would also still count as demand orders for the Water Authority and be subject to penalty payments by Poseidon in accordance with the WPA.
Dredging With the closure of the EPS, Poseidon assumed responsibility for periodic dredging of Agua Hedionda Lagoon to maintain flow through the lagoon and into the existing and future intake facilities. This function was previously the responsibility of NRG to support power generation at the EPS and was last performed in 2018. It is anticipated that additional dredging will be required as early as October 2020 and again as part of the
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construction effort for the permanent intake screens located in the lagoon (October 2023). While some historical costs for dredging have been shared by NRG, the work is highly specialized and costs can vary significantly, based on actual conditions at the time of the dredging. As such, dredging was not included in the fixed price increase for TSOP. Staff plans to address the first Poseidon dredging event anticipated in 2020, and potentially the 2023 effort as well, as a direct pass through of costs at the time they are incurred as provided for in the WPA. Therefore, dredging was not included in the TSOP increment unit price increase.
Total Cost Adjustment The total annual increase to the purchase price of desalinated water based on the cost components above is $6,462,997 as shown in Table 1 below. This equates to a $135/acre- foot increase in the unit price of water during TSOP.
Table 1. Total Cost Adjustment Cost Components Annual Cost Adjustment ($) Administrative $240,458 Electricity $3,310,101 Operations, Maintenance and Repairs $2,462,438 Contingency $450,000 Total Cost Adjustment $6,462,997
The Water Authority’s cost liability related to the closure of the EPS are capped as stated in Section 4.8(B) of the WPA. These capped amounts are not applicable to the costs linked to compliance with the OPA. Water Authority staff reviewed the accounting of cost for the TSOP and determined that the cap provisions provided for in the WPA have not been reached.
Next Steps In the coming months, staff plans to return to the Board to report on the scheduled Regional Board permit hearing for the Modifications and to seek approval of subsequent CAMs that will address Interim Operations construction, financing and related pricing adjustments as well as future EPA WIFIA low-interest loan financing.
Prepared by: Jeremy Crutchfield, Water Resources Manager Reviewed by: Robert R. Yamada, Special Projects Director Reviewed by: Kelley Gage, Director of Water Resources Approved by: Sandra L. Kerl, Acting General Manager
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April 17, 2019
Attention: Water Planning Committee
Resolution to Submit Application under Department of Water Resources Water Desalination Grant Program’s Continuous Application Process (Action)
Staff recommendation Adopt Resolution No . 2019-__ establishing that: a) The General Manager is authorized to sign and file for, on behalf of the Water Authority, a grant application for funding from the Department of Water Resources Desalination Grant Program (Continuous Application Process) in an amount not to exceed $1,250,000 for the Lewis Carlsbad Desalination Plant (CDP) Wedgewire Screen Demonstration Project. b) The Water Authority will comply with all applicable state and federal statutory and regulatory requirements related to any federal and state funds received. c) The General Manager or designee is authorized to negotiate and execute a funding agreement and any amendments thereof, and certify funding disbursements on behalf of the Water Authority.
Alternative Do not adopt the resolution. Doing so will disqualify the Water Authority from applying for grant funding under Department of Water Resources Desalination Grant Program.
Fiscal Impact If grant funds are awarded and an agreement executed, the Water Authority and/or its partner Poseidon Resources (Channelside) LP (Poseidon) must be capable of cost sharing 50 percent or more of eligible project costs. Such cost share funding would be provided through Poseidon’s financing of the intake modifications and the Water Authority’s anticipated commitment via the Water Purchase Agreement (WPA) to pay for the intake modifications through future water purchase payments.
Executive Summary • The Wedgewire Screen Demonstration Project will provide data to optimize the proposed intake and discharge facility modifications to replace the current facility configuration that utilizes the Encina Power Station once-through cooling system. • Staff is seeking authorization to submit a grant application to support the Demonstration Project, requesting up to $1,250,000 from Department of Water Resources through its Water Desalination Program. • Applications are being accepted through a continuous application process; with the next award announcements anticipated in Summer 2019.
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Background The CDP started commercial operations in December 2015 and is a result of a Public-Private Partnership between the Water Authority and Poseidon. A thirty-year WPA was approved by the Water Authority Board on November 29, 2012 and outlines the financing, construction and operation of the CDP.
The CDP is co-located with the Encina Power Station (EPS) adjacent to the Agua Hedionda Lagoon and uses the EPS’s existing intake and discharge facilities to bring source water to the plant and discharge the brine. On December 11, 2018 the EPS ceased power generation and was replaced by a new air-cooled power plant, just to the east of the existing EPS. For the near term, Poseidon has reached agreement with NRG Energy (NRG), the owner of the EPS, to temporarily extend the operation of just the cooling water circulation pumps solely to support desalination plant operations. For the long-term, the shutdown of the EPS and its cooling water system will require the construction of new CDP intake and discharge facilities to allow a transition to a “stand-alone” operation of the desalination plant. In addition, the new facilities are required to comply with the statewide Ocean Plan Amendment (OPA) that addresses desalination facility intakes and discharges, adopted by the State Water Resources Control Board in May 2015.
Poseidon is planning a phased implementation of the new facilities that will allow the CDP to remain in service. The Wedgewire Screen Demonstration Project addresses the final OPA- compliant intake configuration and evaluates two different wedgewire screen technologies to determine the most efficient configuration to manage free-floating debris and biofouling potential in the Agua Hedionda Lagoon.
The Department of Water Resources (DWR) oversees the Water Desalination Grant Program which provides grants to local agencies for brackish and ocean water desalination projects. The Water Desalination Grant Program utilizes funding from Proposition 1. In March 2018, DWR implemented a Continuous Application Process (CAP) to solicit agencies to apply for funding. Qualified projects will be awarded on a first-ready, first awarded basis until grant funds are exhausted.
Discussion Staff believes that the Wedgewire Screen Demonstration Project meets the CAP eligibility requirements and is recommending submittal of a funding proposal for the Project. The funding proposal must include an approved resolution from the agency’s governing body authorizing a representative to submit a funding proposal on behalf of the Water Authority, negotiate and execute a funding agreement, and confirm Water Authority compliance with applicable statutes and regulations. A copy of the resolution is attached.
Prepared by: Goldy Herbon, Senior Water Resources Specialist Reviewed by: Kelley Gage, Director of Water Resources Approved by: Sandra L. Kerl, Deputy General Manager
Attachment: Resolution 2019- ___ authorizing the General Manager to submit a grant application for the Carlsbad Desalination Plant Wedgewire Screen Demonstration Project
Page 97 of 146 RESOLUTION NO. 2019-____
RESOLUTION OF THE BOARD OF DIRECTORS OF THE SAN DIEGO COUNTY WATER AUTHORITY AUTHORIZING THE GENERAL MANAGER TO SUBMIT AN APPLICATION, EXECUTE AN AGREEMENT AND ANY AMENDMENTS, AND CERTIFY FUNDING DISBURSEMENTS FOR GRANT FUNDING UNDER THE CALIFORNIA DEPARTMENT OF WATER RESOURCES PROPOSITION 1 ROUND 4 WATER DESALINATION GRANT PROGRAM FOR THE LEWIS CARLSBAD DESALINATION PLANT WEDGEWIRE SCREEN DEMONSTRATION PROJECT.
WHEREAS, the San Diego County Water Authority is undertaking the Lewis Carlsbad Desalination Plant Wedgewire Screen Demonstration Project to provide data on the capability of wedgewire screens to satisfy requirements of the National Pollutant Discharge Elimination System (NPDES) Permit No. CA0109223 and comply with the Ocean Plan Amendment, and to facilitate permanent stand-alone operation of the Carlsbad Desalination Plant; and
WHEREAS, pursuant and subject to all of the terms and provisions of the Water Quality, Supply, and Infrastructure Improvement Act of 2014 (Proposition 1, California Water Code Section 79700 et seq.) the California Department of Water Resources is sponsoring Round 4 funding of the Water Desalination Grant Program; and
WHEREAS, the California Department of Water Resources released the Proposal Solicitation Package for Round 4 of the Water Desalination Grant Program on June 16, 2017; and
WHEREAS, the Water Authority has prepared an application in response to the Proposal Solicitation Package for Round 4 of the Water Desalination Grant Program through the Continuous Application Process.
NOW, THEREFORE, BE IT RESOLVED, by the Board of Directors of the San Diego County Water Authority that the Sandra L. Kerl, Acting General Manager, is hereby authorized and directed to sign and file for, and on behalf of the Water Authority, an application for funding from the Department of Water Resources for an amount not to exceed $1,250,000, for the project titled Lewis Carlsbad Desalination Plant Wedgewire Screen Demonstration Project, under the terms and provisions of the Water Desalination Grant Program, and
BE IT RESOLVED that the Water Authority hereby agrees and further does authorize the aforementioned representative or her designee to certify that the Water Authority has and will comply with all applicable state and federal statutory and regulatory requirements related to any federal and state funds received, and
BE IT RESOLVED that Sandra L. Kerl, Acting General Manager, or her designee of the Water Authority is hereby authorized to negotiate and execute a funding agreement and any amendments or change orders thereto, and to certify funding disbursement on behalf of the Water Authority.
Page 98 of 146 PASSED, APPROVED AND ADOPTED, this 25th day of April 2019, by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
______Jim Madaffer, Chair
ATTEST:
______Christy Guerin, Secretary
I, Melinda Nelson, Clerk of the Board of the San Diego County Water Authority, certify that the vote shown above is correct and this Resolution No. 2019- ___ was duly adopted at the meeting of the Board of Directors on the date stated above.
______Melinda Nelson, Clerk of the Board
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April 17, 2019
Attention: Water Planning and Environmental Committee
Update on water supply conditions. (Presentation)
Purpose To provide a report on current water supply conditions and outlook for the 2018-2019 winter.
Discussion Following a dry year in Water Year (WY) 2018, WY 2019 started off dry until a series of storms in late November 2018 resulted in a significant improvement to the northern Sierra snowpack. The snowpack continued to slowly improve in December and January, and then a series of storms in February more than doubled the snowpack from January levels. Storm systems that moved through California in March 2019 continued to produce additional snow.
In November 2018, the California Department of Water Resources (DWR) announced an initial State Water Project (SWP) allocation of 10 percent for Calendar Year (CY) 2019. On January 25, 2019, DWR announced an increase in the SWP allocation to 15 percent, and then announced a second increase to 35 percent on February 20, 2019. The latest increase to 70 percent was announced on March 20, 2019, and another increase to the allocation remains possible under certain Delta conditions.
State Water Project After a dry start to WY 2019, conditions improved in the northern Sierra Nevada starting in late November 2018. Precipitation was at 135 percent of average as of April 12, 2019, and snow water content was at 163 percent of normal as of April 1, the typical seasonal peak. DWR conducted its fourth 2019 manual snow survey at Phillips Station on April 2, 2019, and measured a snow water equivalent of 51 inches, which was 200 percent of average for that location. The early April survey is typically the last one of the water year, but because of the amount of snow this year, DWR has planned another survey for May.
Storage in Lake Oroville was maintained below average since April 2017 due to repair work on the main and emergency spillways. DWR announced on October 31, 2018, that it had met its goal of completely reconstructing the main spillway by November 1, 2018, however, construction on the emergency spillway is ongoing. DWR’s flood operations plan for the 2018-19 flood season called for maintaining lower-than-average lake levels during the winter months to provide operational flexibility to ensure flood protection, meet water deliveries and environmental requirements, and prevent use of the emergency spillway during the winter. On April 2, 2019, DWR began to release flows from the main spillway in what was the first time the main spillway was used since reconstruction, providing room for flood storage within the reservoir as snowpack begins to melt with warmer spring temperatures. DWR will allow the lake to continue rising past winter target elevations during the late spring and summer months to increase water supply storage.
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Table 1 shows storage levels for Lake Oroville and San Luis Reservoir as of April 11, 2019.
Table 1 - Reservoir Storage Levels (April 11, 2019) Storage in Million Percent of Percent of Reservoir Acre-Feet Capacity Average Oroville 2.942 83% 107% San Luis* 1.971 97% 107% Combined 4.913 88% 107% *San Luis storage includes SWP and Central Valley Project. SWP share in San Luis was approximately 1.06 million acre-feet.
Colorado River As of April 8, 2019, Upper Colorado River Basin rainfall was at 119 percent of average and snowpack was at 130 percent of average. Table 2 shows storage levels for Lakes Powell and Mead as of April 7, 2019.
Table 2 - Reservoir Storage Levels (April 7, 2019) Storage in Reservoir Percent of Capacity Million Acre-Feet Lake Powell 9.01 37% Lake Mead 10.84 42% Combined 19.85 39%
As of April 2, 2019, the forecasted inflow for WY 2019 was 12.1 million acre-feet (MAF), which is 112 percent of normal. As of January 2019, the federal Bureau of Reclamation does not anticipate a shortage condition on the Colorado River in 2019. In addition, based on accumulated snowpack since the middle of January, it now looks likely that a shortage declaration will be avoided in 2020.
Metropolitan Water District As of January 1, 2019, the Metropolitan Water District of Southern California (MWD) had 702,000 acre-feet (AF) of storage in Diamond Valley Lake, approximately 45,000 AF less storage than one year ago. Total storage capacity in Diamond Valley Lake is approximately 810,000 AF. MWD staff reported that the current range of water supply demand balance scenarios project a net gain in MWD’s dry-year storage in CY 2019.
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Local Conditions Local reservoir storage as of March 25, 2019, was at 58 percent of capacity, or approximately 428,000 AF. This total includes “dead storage,” or capacity that is physically inaccessible or restricted by agency operating or emergency storage policies. It also includes Water Authority carryover and emergency storage in Lake Hodges, Olivenhain Reservoir, and San Vicente Reservoir. A breakdown of Water Authority storage for March 2019 is contained in Exhibit D of this month’s Water Resources Report.
While temperatures in the San Diego region were hotter than normal during the first four months of WY 2019, the trend shifted and the average daily maximum temperature at Lindberg Field was 2.5 degrees below normal in February 2019. However, the average daily maximum temperature was once again above average in March 2019, at 1.1 degrees above normal. Figure 1 shows the departure from normal maximum monthly temperatures at Lindbergh Field for Water Years 2018 and 2019, with only May 2018 and February 2019 registering a below-normal average daily maximum temperature.
Figure 1 –Average Daily Maximum Temperature Departure from Normal (oF) Water Years 2018 and 2019 10 2017 - 2018 2018 - 2019 8
6 F)
o 4 Hotter
2 0
( Temperature -2 Cooler -4 Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Precipitation in the San Diego region has been above average for WY 2019. Table 3 on the following page contains cumulative rainfall totals since October 1, 2018, for Lindbergh Field and Ramona Airport. These locations are geographically representative of coastal and inland regions of the Water Authority service area. While March 2019 was drier than normal, both inland precipitation and coastal precipitation remain well above normal to date for WY 2019, measured at 125 percent of normal at Lindbergh Field and 134 percent of normal at Ramona Airport.
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Table 3 – Water Year 2019 Rainfall Totals (October 1, 2018 – April 11, 2019) Station Precipitation (Inches) Percent of Normal Lindbergh Field 11.92 125% Ramona Airport 18.86 134%
Outlook On March 21, 2019, the Climate Prediction Center (CPC) issued its three-month outlook (April through June) for precipitation and temperature across the country (Figure 2). The CPC precipitation outlook shows that across California there is an equal chance of above normal, normal, and below normal precipitation. The CPC temperature outlook shows that there is a greater than 33 percent probability of above-normal temperatures for the northern half of California, with no indication for the southern portion of the state.
Figure 2 - Precipitation and Temperature Outlook (April 2019 – June 2019)
Based on current supply levels, the Water Authority and its member agencies will meet anticipated demands through a combination of imported supplies and drought-resilient local and regional water resources, including the Claude “Bud” Lewis Carlsbad Desalination Plant, conserved agricultural water transfers, savings from canal lining projects, and continued water- use efficiency measures.
Prepared by: Alexi Schnell, Water Resources Specialist Reviewed by: Jeff Stephenson, Principal Water Resources Specialist Kelley Gage, Director of Water Resources Approved by: Sandra L. Kerl, Acting General Manager
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April 17, 2019
Attention: Water Planning and Environmental Committee
Update on Senate Bill 606 and Assembly Bill 1668 Implementation (Presentation)
Purpose To provide the Committee with a presentation on the state’s progress to implement Senate Bill 606 (SB 606) and Assembly Bill 1668 (AB 1668).
Executive Summary • Senate Bill 606 and Assembly Bill 1668 were signed into law by Governor Brown in May 2018. • The laws provide a long-term framework for water conservation and drought planning in California. • The California Department of Water Resources and other state agencies have started to form workgroups to implement the provisions of the bills. • Water Authority staff is engaged in the process and will continue to provide updates to the member agencies.
Background SB 606 and AB 1668 were signed into law by Governor Jerry Brown in May 2018. The two bills were the result of an April 2017 report entitled, Making Water Conservation a California Way of Life, Implementing Executive Order B-37-16. The report included a framework to establish a new foundation for long-term improvements in water conservation and drought planning and a variety of actions to implement the long-term improvements.
Discussion In November 2018, the California Department of Water Resources (DWR) and the State Water Resources Control Board (SWRCB) released a primer of the legislation that summarized the authorities, requirements, and schedules included in the legislation. The content of the primer is organized to align with the following four primary goals of the framework: 1) use water more wisely; 2) eliminate water waste; 3) strengthen local drought resilience; and 4) improve agricultural water use efficiency and drought planning. The discussion below focuses only on implementation of the three goals related to urban water use, and not on the goal related to agricultural water use efficiency and drought planning.
The legislation amended, repealed, and added many sections to the California Water Code. Because of this complexity and various due dates in the legislation, implementation of all the provisions of SB 606 and AB 1668 will take many years. However, implementation of some of the provisions began immediately after the bills were signed by the governor in May 2018. Listed below are summaries of some of the recent actions to implement the three primary urban water use goals. Since the bills were signed into law in May 2018, Water Authority staff has engaged with DWR and SWRCB staff to represent the interests of the San Diego region. Additional information will be
Page 104 of 146 Water Planning and Environmental Committee April 17, 2019 Page 2 of 3 included in the staff presentation to the Water Planning and Environmental Committee on April 25, 2019.
Primary Goal #1 - Use Water More Wisely Several actions are required to implement this goal, including the development of a budget-based method to quantify water use objectives and adoption of water use efficiency standards and objectives. To date, a majority of the work to implement this goal has focused on DWR staff’s efforts to develop the outdoor residential water use information that will be used in the water use objective calculation. This work includes a small pilot project completed in 2018 that tested the accuracy of aerial imagery to measure landscape areas. Additional work to test the accuracy of the aerial imagery includes a second small pilot project that was started in 2019 and is ongoing, and several larger pilot projects planned for the near future. A public stakeholder workgroup that will focus on urban landscape areas will also be formed this summer to support implementation of the goal. DWR staff plans to complete the landscape area measurements for all water suppliers by 2021.
Primary Goal #2 - Eliminate Water Waste SB 606 and AB 1668 affirmed the need for continued implementation of the existing requirements enacted in 2015 by SB 555. That bill requires SWRCB staff to develop water loss performance standards for urban retail water suppliers between January 2019 and July 2020. Development of the standards was initiated through a public stakeholder workgroup in March 2018, with additional meetings in June 2018, September 2018, and February 2019. As a result of this process, SWRCB staff developed a framework proposal for performance standards and began to obtain feedback from stakeholders. SWRCB staff expects to finalize the regulatory proposal and begin the formal rulemaking process by June 2019. SB 606 also requires that DWR and SWRCB staff investigate the feasibility of extending the water loss reporting requirement to urban wholesale water suppliers. A public stakeholder workgroup will be convened in the future as part of that process.
Primary Goal #3 - Strengthen Local Drought Resilience The intent of this goal is to improve water shortage contingency planning, the methodologies used, reporting, and enforcement. Under SB 606, each urban wholesale and retail water supplier must prepare, adopt, and submit a Water Shortage Contingency Plan and conduct a Drought Risk Assessment every five years. Water suppliers must also prepare an annual water supply and demand assessment report. Several water suppliers have worked with DWR staff to provide input on the design of the report with the goal to voluntarily submit the report in 2019 and every year thereafter, until the report becomes mandatory in 2022. The next step in the process is for DWR and SWRCB staff to form an annual water supply assessment stakeholder outreach workgroup to develop implementation details.
Looking ahead, DWR and the SWRCB will hold an “Urban Overview” meeting in Sacramento on May 20, 2019. The purpose of the meeting is to discuss the formation of a broad range of stakeholder outreach workgroups (see Table 1). Water Authority staff plans to attend the May 20 meeting and participate on the relevant workgroups.
Page 105 of 146 Water Planning and Environmental Committee April 17, 2019 Page 3 of 3
Table 1 - Stakeholder Outreach Workgroups Urban Landscape Area County Drought Wholesale Water Loss Water Use Studies Standards, Methodologies, and Performance Measures Urban Water Management Plan Guidebook Annual Water Supply Assessment Model Water Efficient Landscape Ordinance Agricultural Water Management Plan Guidebook Data Submittal
In addition, Water Authority staff will continue to hold a monthly conference call for its Member Agency State Regulatory Workgroup, which began in December 2018. The conference call provides a forum for Water Authority staff to update the member agencies on the status of various regulatory activities, including implementation of SB 606 and AB 1668. The conference call also allows the member agencies to ask questions and provide feedback to Water Authority staff in tracking regulatory issues.
Prepared by: Jeff Stephenson, Principal Water Resources Specialist Reviewed by: Kelley Gage, Director of Water Resources Approved by: Sandra L. Kerl, Acting General Manager
Page 106 of 146
April 17, 2019
Attention: Water Planning and Environmental Committee
Water Resources Report
Purpose This report includes the following exhibits for March 2019:
Rainfall totals and temperature data Deliveries to Member Agencies (Exhibit A) Water Use by Member Agencies (Exhibit B) Potable M&I Water Use (Exhibit C) Storage Available to Member Agencies (Exhibit D) Firm Water Deliveries to Member Agencies (Exhibit E) Summary of Water Authority Member Agency Operations (Exhibit F)
RAINFALL TOTALS (inches) WATER YEAR 2019 TO DATE March 2019 (October 2018 through March 2019)
% Station Actual Normal Actual Normal Departure Normal* Lindbergh Field 1.23 1.81 11.85 9.17 2.68 129% (N.O.A.A.)
Ramona Airport 1.74 3.08 18.75 13.65 5.10 137% (N.O.A.A.)
Lake Henshaw 2.44 4.63 32.94 22.93 10.01 144% (Vista I.D.) *Accumulated through March 2019.
Sources: National Weather Service, Vista Irrigation District.
AVERAGE DAILY MAXIMUM TEMPERATURE (°F) March 2019 Station March 2019 Actual Variance Normal Lindbergh Field 66.7 65.6 1.1 (N.O.A.A.) Since January 2014, 59 of last 63 months were hotter than normal at Lindbergh Field
Page 107 of 146 EXHIBIT A MONTHLY WATER RESOURCES REPORT Water Deliveries to Member Agencies (acre-feet)
MARCH 2019
March 12 Months Ended March Member Agency 2019 2018 2019 2018 Carlsbad M.W.D. 1 680.6 937.1 14,568.5 15,985.4 Del Mar, City of 44.7 70.4 982.6 1,064.6 Escondido, City of 2 74.9 125.9 12,632.6 10,200.2 Fallbrook P.U.D. 3 184.0 418.8 8,695.3 9,858.6 Helix W.D. 923.3 1, 330.5 26,867.4 23,150.6 Lakeside W.D. 138.5 149.6 2,740.9 2,799.0 National City, City of 4 0.0 - 15.4 623.5 Oceanside, City of 1,099.3 1, 180.6 20,504.1 22,948.0 Olivenhain M.W.D. 812.3 941.4 17,549.3 19,411.3 Otay W.D. 1,621.3 1, 813.0 28,070.7 29,369.0 Padre Dam M.W.D. 552.4 603.8 9, 848.8 10,084.4 Pendleton M.C.B. 5.2 4.9 56.1 75.8 Poway, City of 347.6 731.4 9, 112.7 10,467.3 Rainbow M.W.D. 423.7 732.0 16,159.4 19,286.2 Ramona M.W.D. 204.2 237.8 5,764.6 4,847.2 Rincon Del Diablo M.W.D. 210.2 267.0 4,976.1 5,457.7 San Diego, City of 4 12,585.9 10,202.5 180,771.8 161,927.8 San Dieguito W.D. 199.7 151.4 3,306.6 2,905.6 Santa Fe I.D. 162.3 209.6 6,570.7 6,196.9 South Bay I.D. 4 88.0 - 3,719.7 3,516.7 Vallecitos W.D. 1 500.9 823.6 14,292.2 16,043.4 Valley Center M.W.D. 490.6 690.7 18,630.6 22,572.2 Vista I.D. 2 38.7 85.8 9,396.9 6,960.6 Yuima M.W.D. 71.7 94.6 5,507.0 5,598.0 Deliveries To SDCWA Agencies 4 21,460.0 21,802.4 420,740.0 411,350.0 Less: Deliveries to SDCWA Storage 4 4,813.8 225.3 14,293.8 11,491.9 TOTAL MEMBER AGENCY DELIVERIES 16,646.2 21,577.1 406,446.2 399,858.1 Deliveries to South Coast Water District 7.5 8.4 115.9 95.3 Deliveries From SDCWA Storage 4 96.2 - 16,131.8 8,481.7
1 Carlsbad M.W.D. and Vallecitos W.D. deliveries exclude local desal. 2 Escondido and Vista I.D. deliveries exclude SLR water transfers. 3 Fallbrook P.U.D. excludes wheeled delivery of 206.8 AF in March 2019. 4 Member agency deliveries include puts into Water Authority storage accounts. For March 2019, storage account deliveries totaled 4,583 AF and 231 AF to San Vicente Reservoir and Lower Otay Reservoir, respectively, through city of San Diego connections. March 2019 storage puts into San Vicente Reservoir were higher due low demands resulting in the need to store a portion of the QSA delivery. March 2018 storage account deliveries totaled 170 AF and 55 AF to San Vicente Reservoir and Lower Otay Reservoir, respectively, through city of San Diego connections. March 2019 storage sales to the city of San Diego totaled 96 AF from San Vicente Reservoir.
Generated:
4/15/19 3:28 PM Page 108 of 146 EXHIBIT B MONTHLY WATER RESOURCES REPORT Estimated Water Use by Member Agency (acre-feet) MARCH 2019 Water Authority Local March Source Sources Totals Desal / Imported/Desal Surface Groundwater Recycled Supplemental 1 Member Agency 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 Carlsbad M.W.D. 680.6 783.7 - - - - 24.2 197.2 208.4 208.4 913.2 1,189.3 Del Mar, City of 44.7 70.4 - - - - 1.0 6.0 - - 45.7 76.4 Escondido, City of 77.7 257.3 405.2 0.0 - - 1.9 13.2 614.0 1,008.4 1, 098.8 1, 278.9 Fallbrook P.U.D. 2 340.0 410.2 206.8 - 6.0 0.2 21.1 42.4 - - 573.9 452.8 Helix W.D. 1,109.5 1,493.8 607.0 475.6 9.2 9.1 - - - - 1,725.7 1, 978.5 Lakeside W.D. 138.5 149.6 - - 57.8 68.1 - - - - 196.3 217.7 National City, City of 3 18.2 - 54.8 196.3 376.8 220.9 - - - - 449.8 417.2 Oceanside, City of 3 1,099.3 1,180.6 - - 235.9 140.4 - - - - 1,335.2 1, 321.0 Olivenhain M.W.D. 812.3 941.4 - - - - 11.9 118.3 - - 824.2 1,059.7 Otay W.D. 1,621.3 1,813.0 - - - - 26.7 118.0 - - 1,648.0 1, 931.0 Padre Dam M.W.D. 550.3 601.2 - - - - 14.7 55.9 - - 565.0 657.1 Pendleton M.C.B. 4 12.7 13.3 - - 450.0 440.0 15.0 13.3 - - 477.7 466.6 Poway, City of 5 376.7 485.0 - - - - 10.0 6.0 - - 386.7 491.0 Rainbow M.W.D. 486.7 635.0 ------486.7 635.0 Ramona M.W.D. 216.4 253.0 - - - - - 20.0 - - 216.4 273.0 Rincon Del Diablo M.W.D. 210.2 267.0 - - - - 22.9 62.6 - - 233.1 329.6 San Diego, City of 7,594.2 10,036.4 2,802.7 1, 530.2 48.8 64.0 154.0 374.4 - - 10,599.7 12,005.0 San Dieguito W.D. 199.7 151.4 149.3 210.2 - - 11.8 26.8 - - 360.8 388.4 Santa Fe I.D. 162.3 209.6 200.5 282.5 - - 13.5 26.5 - - 376.3 518.6 South Bay I.D. 3 61.2 - 184.2 366.6 487.0 374.6 - - - - 732.4 741.2 Vallecitos W.D. 509.6 581.6 ------291.6 291.6 801.2 873.2 Valley Center M.W.D. 490.6 690.7 - - - - 34.0 34.7 - - 524.6 725.4 Vista I.D. 38.7 85.8 405.2 0.0 - - - - 463.6 961.4 907.5 1,047.2 Yuima M.W.D. 71.7 94.6 - - 126.4 161.3 - - - - 198.1 255.9 TOTAL USE 16,923.1 21,204.6 5,015.7 3, 061.4 1, 797.9 1, 478.6 362.7 1,115.3 1, 577.6 2, 469.8 25,677.0 29,329.7 PERCENT CHANGE -20% 64% 22% -67% -36% -12%
1 SLR water transfers were added as local supply sources beginning in December 2017, for Escondido and Vista I.D. only. 2 De Luz figures included in Fallbrook P.U.D. totals. Surface use includes 206.8 AF of wheeled water from MWD. 3 Brackish groundwater figures included in Groundwater figures. 4 Pendleton M.C.B. Imported Use includes South Coast Water District deliveries. 5 Poway's recycled use is reported quarterly and is estimated at 1/3 of that amount, monthly.
Generated: 4/15/19 3:28 PM
Page 109 of 146 EXHIBIT C MONTHLY WATER RESOURCES REPORT Potable M&I Water Use for State Water Resources Control Board Emergency Regulation Tracking 1,2,3 (acre-feet)
MARCH 2019
March 46 Months Ended Member Agency 2019 2013 March 2019 CY 2013 4 Carlsbad M.W.D. 889.0 1,326.1 56,805.9 66,869.6 Del Mar, City of 44.7 78.7 3,701.0 4,276.1 Escondido, City of 1,076.9 1,439.2 67,264.7 81,548.5 Fallbrook P.U.D. 340.5 552.9 25,539.5 32,028.0 Helix W.D. 1,725.7 2,427.4 109,488.4 131,488.1 Lakeside W.D. 196.3 260.1 13,035.1 16,060.6 Oceanside, City of 1,325.2 2,018.9 87,928.3 107,588.8 Olivenhain M.W.D. 809.9 1,444.2 66,499.9 79,734.6 Otay W.D. 1,621.3 2,244.8 104,902.6 122,849.4 Padre Dam M.W.D. 550.3 767.3 35,519.4 42,988.4 Pendleton M.C.B. 462.7 589.4 24,709.2 29,774.6 Poway, City of 376.2 741.3 35,363.6 46,171.8 Rainbow M.W.D. 447.6 750.4 36,559.3 42,061.2 Ramona M.W.D. 209.7 355.1 13,656.4 18,415.2 Rincon Del Diablo M.W.D. 210.2 424.7 19,111.9 24,809.7 San Diego, City of 10,440.7 14,071.1 635,079.9 752,010.4 San Dieguito W.D. 349.0 464.0 21,387.3 24,936.4 Santa Fe I.D. 362.8 748.6 35,118.7 43,428.6 Sweetwater Authority 5 1,182.2 1,616.4 66,390.7 81,396.0 Vallecitos W.D. 788.2 1,135.4 52,391.9 61,373.7 Valley Center M.W.D. 462.7 614.9 27,242.7 35,294.7 Vista I.D. 907.4 1,340.8 64,265.2 73,646.5 Yuima M.W.D. 151.9 696.1 25,434.0 36,752.0 TOTALS 24,931.1 36,107.8 1,627,395.6 1,955,502.9 PERCENT CHANGE -31% -17% NOTES: 1 SWRCB emergency regulation went into effect June 2015. 2 The 2013 baseline is utilized to be consistent with the May 2015 SWRCB emergency drought regulation, which was partially rescinded on April 26, 2017. The conservation regulation expired completely on November 25, 2017. Agencies have continued to report to SWRCB beyond November. 3 Excludes recycled water use and Transitional Special Agricultural Water Rate program deliveries. TSAWR deliveries are estimated for months where agencies have not reported.
4 Baseline includes January-December 2013 three times; January-March 2013 once, and June-December 2013 once, in order to establish a base period of 46 months. 5 Sweetwater Authority is comprised of member agencies city of National City and South Bay Irrigation District.
Generated: 4/12/19 4:27 PM
Page 110 of 146 EXHIBIT D MONTHLY WATER RESOURCES REPORT Reservoir Storage (acre-feet) MARCH 2019
% of % of Change Member Agency Reservoir Capacity March 2019 Capacity March 2018 Capacity During Month Carlsbad M.W.D. Maerkle 600 1 0% 96 16% 1 Escondido, City of 1,2 Dixon 2,606 2,516 97% 2,406 92% 83 Wohlford 6,506 2,474 38% 2,174 33% 56 Subtotals 9,112 4,990 55% 4,580 50% 139 Fallbrook P.U.D. Red Mountain 1,335 527 39% 278 21% 192 Helix W.D. Cuyamaca 8,195 3,331 41% 700 9% 243 Jennings 9,790 8,959 92% 8,936 91% (20) Subtotals 17,985 12,290 68% 9,636 54% 223 Poway, City of Poway 3,330 3,300 99% 3,132 94% 22 Rainbow M.W.D. Morro Hill 465 140 30% 232 50% (49) Ramona M.W.D. Ramona 12,000 2,943 25% 2,215 18% 49 San Diego, City of 3 Barrett 34,806 16,670 48% 12,207 35% 1,750 El Capitan 112,807 42,486 38% 27,793 25% 4,352 Hodges 10,633 12,915 121% 11,213 105% 1,200 Lower Otay 47,067 39,360 84% 36,251 77% 657 Miramar 6,682 5,507 82% 5,452 82% 14 Morena 50,694 5,075 10% 3,853 8% 596 Murray 4,684 4,044 86% 4,075 87% (77) San Vicente 91,695 67,365 73% 53,806 59% 4,943 Sutherland 29,508 10,829 37% 13,528 46% (803) Subtotals 388,576 204,252 53% 168,177 43% 12,632 San Dieguito WD / Santa Fe ID San Dieguito 883 398 45% 372 42% (9) Sweetwater Authority Loveland 25,400 10,112 40% 13,669 54% (2,399) Sweetwater 28,079 16,219 58% 5,623 20% 6,361 Subtotals 53,479 26,331 49% 19,292 36% 3,962 Valley Center M.W.D. Turner 1,612 1,612 100% 1,200 74% - 4 Vista I.D. Henshaw 51,774 17,599 34% 4,379 8% 2,648 MEMBER AGENCY TOTAL 541,151 274,381 51% 213,589 39% 19,810 WATER IN STORAGE Olivenhain 24,774 22,532 20,393 1,013 San Vicente - Comprised of: 157,663 123,979 133,392 4,367 Water Authority 5 Emergency 27,710 28,768 (28) Carryover 86,924 94,595 (87) Operating 9,344 10,028 4,482 Hodges 20,000 7,771 4,142 (1,370) Subtotals 202,437 154,281 76% 157,927 78% 4,010 El Capitan 00 - Water Authority Storage Accounts 6 Lower Otay 552 0 226 Sweetwater (Temporary) 0 2,369 - Subtotals 552 2,369 226 TOTAL WATER 743,588 429,21458% 373,884 50% 24,046 IN STORAGE
OTHER AGENCIES Metropolitan Water District Skinner 44,264 35,918 81% 32,575 74% (3,813) Diamond Valley 810,000 744,904 92% 723,792 89% 29,730 State Water Project Oroville 3,537,577 2,849,335 81% 2,093,173 59% 660,859 TOTAL OTHER 4,391,841 3,630,157 83% 2,849,540 65% 686,776 WATER IN STORAGE
1 Excludes storage allocated to Escondido Mutual Water Co. or its rights to a portion of the unallocated water in Lake Henshaw. 2 Revised capacity volume accounts for lowered reservoir level at Lake Wohlford due to DWR Division of Safety of Dams safety issues. 3 Includes city’s supply and storage obligations to California American Mutual (Cal-Am) Water Company and San Dieguito WD/Santa Fe ID. 4 Includes allocated and unallocated water in Lake Henshaw. 5 Water Authority carryover, emergency and operating pools in San Vicente Reservoir were established in June 2015. City of San Diego presently states total capacity in San Vicente at 249,358 AF, with the Water Authority portion being 157,663 AF and the remaining capacity, 91,695 AF, allocable to the city. 6 No defined capacities for storage accounts in El Capitan, Lower Otay and Sweetwater Authority reservoirs. Figures for March 2019 include evaporation/seepage estimates.
Generated: 4/15/19 8:34 AM
Page 111 of 146 EXHIBIT E MONTHLY WATER RESOURCES REPORT Tier 1 Estimated Deliveries to Member Agencies (Figures in acre-feet)
Calendar Year 2019 (3 Months: Jan. - March 2019)
% of Tier 1 Threshold (Pre- CY2019 Tier 1 Threshold 1 CYTD Firm Deliveries 2 Member Agency QSA) Carlsbad M.W.D. 12,376.0 1,414.9 11.4% Del Mar, City of 935.0 139.5 14.9% Escondido, City of 3 17,859.0 233.6 1.3% Fallbrook P.U.D. 4 10,325.0 747.6 7.2% Helix W.D. 25,519.0 2,712.7 10.6% Lakeside M.W.D. 3,168.0 402.1 12.7% Oceanside, City of 19,383.0 3,194.5 16.5% Olivenhain M.W.D. 13,071.0 2,146.1 16.4% Otay W.D. 21,390.0 4,595.7 21.5% Padre Dam M.W.D. 9,939.0 1,577.4 15.9% Pendleton M.C.B. / South Coast W.D. 758.0 38.3 5.1% Poway, City of 9,348.0 893.5 9.6% Rainbow M.W.D. 19,018.0 1,029.7 5.4% Ramona M.W.D. 8,052.0 1,036.0 12.9% Rincon Del Diablo M.W.D. 5,482.0 595.2 10.9% San Diego, City of 144,555.0 25,822.5 17.9% San Dieguito W.D. 3,116.0 590.0 18.9% Santa Fe I.D. 5,226.0 540.3 10.3% Sweetwater Authority 5 9,650.0 500.1 5.2% Vallecitos W.D. 10,557.0 737.0 7.0% Valley Center M.W.D. 29,774.0 1,210.4 4.1% Vista I.D. 3 11,876.0 223.8 1.9% Yuima M.W.D. 2,165.0 117.1 5.4% MEMBER AGENCY TOTALS 393,542.0 50,498.0 12.8% Less: QSA deliveries-calendar year 2019 (42,574.0) Deliveries to CWA storage-calendar year 2019 6 11,722.3 MWD Under-10% Flows-calendar year 2019 22.2 Deliveries from CWA storage-calendar year 2019 7 (3,666.6) Water Authority WPA desalination deliveries-calendar year 2019 (6,346.0) Estimated Tier 1 deliveries calendar year to date 8 9,655.9 2.5% Invoiced Tier 1 deliveries calendar year to date 8 10,728.0 2.7%
1 Tier 1 threshold is 60% of a member agency's historic maximum year firm demand. 2 Carlsbad MWD and Vallecitos WD deliveries exclude local desalination supply transported via Water Authority system. 3 Escondido and Vista I.D. deliveries exclude SLR water transfers. 4 Fallbrook P.U.D. excludes wheeled delivery of 206.8 AF in March 2019. 5 Sweetwater Authority is comprised of member agencies city of National City and South Bay Irrigation District. 6 Includes storage puts to San Vicente Reservoir, forced deliveries or deliveries to Olivenhain Reservoir directly off Water Authority's aqueduct. 7 Includes sales from Water Authority storage accounts, including Olivenhain Reservoir. 8 Estimated Tier 1 deliveries are based on member agency deliveries net of QSA deliveries, seawater desalination and storage puts/takes. Invoiced deliveries are as reported on Metropolitan's invoice. Difference between Estimated and Invoiced Deliveries is explained by storage puts or takes of pre-deliveries in Twin Oaks Valley Water Treatment Plant (TOVWTP) or member agency treatment plants. Generated: 4/15/19 3:28 PM
Page 112 of 146 EXHIBIT F MONTHLY WATER RESOURCES REPORT Summary of Water Authority Member Agency Operations
MARCH 2019
Member Agency Deliveries (AF)
16,646 2019 March 21,577 2018
2019 406,446 Trailing 12 Months 2018 399,858
0 100,000 200,000 300,000 400,000 500,000
Member Agency Water Use Surface Surface Local Local 5% 20% Well & Well & Imported & Brackish Brackish Desal Imported & Recovery Recovery 65% Desal 5% 7% 81%
Recycled, SLR Recycled, SLR water transfers water transfers & Local Desal & Local Desal 8% 9%
MARCH 2019 Previous 12 Months
Member Agency Storage (AF) 350,000
300,000
250,000 274,381
200,000 243,556 213,589 207,103 150,000
100,000 2019 2019
50,000 2018 2018 0 March Trailing 12-Month Average
Generated: 4/15/19 3:28 PM
Page 113 of 146
4677 Overland Avenue San Diego, California 92123
AGENDA FORMAL BOARD OF DIRECTORS’ MEETING
The mission of the San Diego County Water Authority is to provide a safe and reliable supply of water to its member agencies serving the San Diego region.
APRIL 25, 2019 2:45 p.m.
1. Call to Order.
2. Salute to the flag.
3. Roll call, determination of quorum. 3-A Report on proxies received.
4. Additions to Agenda. (Government code Sec. 54954.2(b)).
5. Approve the minutes of the Special Formal Board of Directors’ meeting and Special Engineering and Operations Committee meeting of March 14, 2019 and Formal Board of Directors’ meeting of March 28, 2019.
6. Opportunity for members of the public who wish to address the Board on matters within the Board’s jurisdiction.
7. PRESENTATIONS & PUBLIC HEARINGS
7-A Presentation of Science Fair Award Winners.
8. REPORTS BY CHAIRS
8-A Chair’s Report: Chair Madaffer
8-B Report by Committee Chairs Engineering and Operations Committee Director Miller Legislation and Public Outreach Committee Director Butkiewicz Administrative and Finance Committee Director Hilliker Imported Water Committee Director Lewinger Water Planning and Environmental Committee Director Heinrichs
Page 114 of 146
9. CONSENT CALENDAR
9-1. Adopt positions on various state bills:
A) Adopt a position of Oppose Unless Amended on AB 217 (Garcia), relating to safe drinking water.
B) Adopt a position of Support on AB 868 (Bigelow), relating to energy system deenergization protocols.
C) Adopt a position of Support on AB 1180 (Friedman), relating to recycled water.
D) Adopt a position of Support on SB 134 (Hertzberg), relating to water system loss enforcement.
E) Adopt a position of Support on SB 487 (Caballero), relating to aerial snow surveys.
F) Adopt a position of Support on SB 785 (Senate Committee on Natural Resources and Water), relating to exchange of property.
9-2. Monthly Treasurer’s Report on Investments and Cash Flow. Note and file the Treasurer’s report.
9-3. Approve Capacity Fee Refund to Bosa Development California, Inc. Authorize Acting General Manager to issue a capacity charges refund in the amount of $138,712 to Bosa Development California, Inc.
9-4. Microsoft Office 365 Service Renewal. Authorize the General Manager to execute an agreement with SoftwareOne in the amount of $448,571 to renew the Water Authority’s Microsoft Office 365 software licenses and provide related Microsoft services for a three-year period ending in May 2022.
9-5. Claude “Bud” Lewis Carlsbad Desalination Plant.
A) Water Purchase Agreement Contract Administration Memorandum Regarding the First Phase of Intake and Discharge System Modifications. Authorize the General Manager to execute a Water Purchase Agreement Contract Administration Memorandum (CAM) between the Water Authority and Poseidon Resources (Channelside) LP to support Temporary Stand-Alone Operations of the intake and discharge facilities at the Lewis Carlsbad Desalination Plant (CDP).
2 Page 115 of 146
B) Resolution to Submit Application under Department of Water Resources Water Desalination Grant Program’s Continuous Application Process. Adopt Resolution No. 2019-08 establishing that:
a. The General Manager is authorized to sign and file for, on behalf of the Water Authority, a grant application for funding from the Department of Water Resources Desalination Grant Program (Continuous Application Process) in an amount not to exceed $1,250,000 for the Lewis Carlsbad Desalination Plant (CDP) Wedgewire Screen Demonstration Project.
b. The Water Authority will comply with all applicable state and federal statutory and regulatory requirements related to any federal and state funds received.
c. The General Manager or designee is authorized to negotiate and execute a funding agreement and any amendments thereof, and certify funding disbursements on behalf of the Water Authority.
10. ACTION / DISCUSSION
11. SPECIAL REPORTS 11-A ACTING GENERAL MANAGER’S REPORT – Ms. Kerl 11-B GENERAL COUNSEL’S REPORT – Mr. Hattam 11-C SANDAG REPORT – Director Morrison SANDAG Subcommittees: Borders Committee – Director Saxod Regional Planning Committee – Director Leonard 11-D AB 1234 Compliance Reports – Directors
12. CLOSED SESSION(S) 12-A Conference with the Labor Negotiator Government Code §54957.6 Agency Designated Representatives: Gretchen Spaniol, Jason Foster, Liana Whyte, Rick Bolanos Employee Organization: Teamsters Local 911
12-B Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) SDCWA v. Metropolitan Water District of Southern California; San Francisco Superior Court Case Nos. CPF-10-510830; CPF-12-512466; CPF-14-514004; CPF-16-515282; CPF-16-515391; CGC-17-563350; CPF-18-516389; California Court of Appeal (1st District) Case Nos. A146901; A148266; A154325; California Supreme Court Case Nos. S243500; and S251025
12-C Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) California Department of Water Resources v. All Persons Interested; Sacramento Superior Court Case No. 34-2017-00215965-CU-MC-GDS; and JCCP 4942
3 Page 116 of 146
12-D Conference with Legal Counsel – Existing Litigation Government Code §§54956.9(d)(1) Food & Water Watch and Center for Food Safety v. Metropolitan Water District of Southern California and All Persons Interested in the Matter; Los Angeles Superior Court Case No. BC 720692
13. ACTION FOLLOWING CLOSED SESSION
14. OTHER COMMUNICATIONS
15. ADJOURNMENT
Melinda Nelson Clerk of the Board
NOTE: The agendas for the Formal Board meeting and the meetings of the Standing Committees held on the day of the regular Board meeting are considered a single agenda. All information or possible action items on the agenda of committees or the Board may be deliberated by and become subject to consideration and action by the Board.
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MINUTES OF THE SPECIAL BOARD OF DIRECTORS’ MEETING March 14, 2019
1. CALL TO ORDER Chair Madaffer called the Special Board of Directors’ meeting to order at 1:36 p.m.
2. SALUTE TO THE FLAG Director Udrys led the salute to the flag.
3. ROLL CALL, DETERMINATION OF QUORUM Vice Chair Croucher called the roll. Directors present were Arant, Ayala, Barnum, Boyle, Cate, Croucher, Evans, Fong-Sakai, Hall, Hedberg, Heinrichs, Hilliker, Hogan, Katz, Kennedy, Leonard, Madaffer, Miller, Mosca, Murtland, Saxod, Scalzitti, Smith, Steiner, Udrys, and Wilson. Directors absent were Bebee (p), Butkiewicz, Cherashore, Guerin, Lewinger, Masson, Morrison, Preciado, Simpson, Watkins and Supervisor Desmond.
Staff present included Acting General Manager Kerl, General Counsel Hattam, Assistant General Managers Cushman and Denham, and MWD Program Director Chen. Also, in attendance was Gail Goldberg, MWD Delegate.
3-A Report on proxies received. Director Arant was the proxy for Director Bebee.
4. PUBLIC COMMENT There were no members of the public who wished to speak.
5. CLOSED SESSION(S) Mr. Hattam took the Board into Closed Session at 1:39 p.m.
5-A Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) SDCWA v. Metropolitan Water District of Southern California; San Francisco Superior Court Case Nos. CPF-10-510830; CPF-12-512466; CPF-14-514004; CPF-16-515282; CPF-16-515391; CGC-17-563350; CPF-18-516389; California Court of Appeal (1st District) Case Nos. A146901; A148266; A154325; California Supreme Court Case Nos. S243500; and S251025
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5-B Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) California Department of Water Resources v. All Persons Interested; Sacramento Superior Court Case No. 34-2017-00215965-CU-MC-GDS; and JCCP 4942
5-C Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) Food & Water Watch and Center for Food Safety v. Metropolitan Water District of Southern California and All Persons Interested in the Matter; Los Angeles Superior Court Case No. BC 720692
Mr. Hattam brought the Board out of Closed Session at 2:59 p.m. and stated there was no reportable action.
6. ACTION FOLLOWING CLOSED SESSION There was no action following Closed Session.
7. OTHER COMMUNICATIONS There were no other communications.
9. ADJOURNMENT There being no further business to come before the Board, Chair Madaffer adjourned the meeting at 3:00 p.m.
______Jim Madaffer, Chair Christy Guerin, Secretary
______Melinda Nelson, Clerk of the Board
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SPECIAL MEETING OF THE ENGINEERING AND OPERATIONS COMMITTEE March 14, 2019
CALL TO ORDER / ROLL CALL Chair Miller called the Engineering and Operations Committee meeting to order at 3:07 p.m. Committee members present were Chair Miller, Vice Chair Fong-Sakai, and Directors Arant, Hedberg, Heinrichs, Mosca, Murtland, Preciado, Smith, and Udrys. Committee members absent were Vice Chair Watkins, and Directors Bebee, Scalzitti, Simpson and Steiner. Also present were Directors Boyle, Evans, Hilliker, Hogan and Katz. At that time, there was a quorum of the Board, and the meeting was conducted as a meeting of the Board; however, only committee members participated in the vote.
Staff present was Acting General Manager Kerl, General Counsel Hattam, Assistant General Managers Cushman and Denham, Director of Operations and Maintenance Fisher, Director of Water Resources Gage, Director of Finance Harris, Deputy Director of Engineering Bousquet, Water Resources Manager Crutchfield, Principal Engineers Fountain and Shoaf, and Operations and Maintenance Manager Faber.
ADDITIONS TO AGENDA There were no additions to the agenda.
PUBLIC COMMENT There were no members of the public who wished to speak.
DIRECTORS’ COMMENTS There were no Directors’ comments.
CHAIR’S REPORT There was no Chair’s Report.
I. CONSENT CALENDAR There were no Consent Calendar items.
II. ACTION/DISCUSSION/PRESENTATION 1. Escalating Construction Costs and Impact on Capital Improvement Program.
Mr. Bousquet began the presentation with a review of the agenda and he announced the purpose of the meeting. He introduced Mr. Shoaf who reviewed the history of the Capital Improvement Program, comprehensive reliability and cost assessment, and investments in supply reliability. Mr. Shoaf introduced Mr. Crutchfield who presented how the Capital Improvement Program was developed for studies and planning efforts by using long-range demand forecast, key planning documents, land-use and water supply coordination, and building consensus for new projects. He also provided a Capital Improvement Program development master plan update.
Mr. Faber presented on how the Capital Improvement Program was developed for the asset management program. He explained program development and process, project review,
Page 120 of 146 and a look ahead. Mr. Faber introduced Mr. Fountain who presented Capital Improvement Program construction costs and influences. He also covered construction cost components, labor shortages, past and current trends, and mitigation measures.
Mr. Bousquet concluded the presentation with steps moving forward, including project prioritization and adjusting budgets.
III. INFORMATION There were no Information items.
IV. CLOSED SESSION There were no Closed Session items.
V. ADJOURNMENT There being no further business to come before the Engineering and Operations Committee, Director Miller adjourned the meeting at 4:11 p.m.
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MINUTES OF THE FORMAL BOARD OF DIRECTORS’ MEETING MARCH 28, 2019
ADMINISTRATIVE AND FINANCE COMMITTEE CALL TO ORDER / ROLL CALL Chair Hilliker called the Administrative and Finance Committee meeting to order at 9:00 a.m. Committee members present were Chair Hilliker, Vice Chair Leonard, and Directors Boyle, Evans*, Katz, Murtland, Saxod, Smith, Udrys, Watkins, and Wilson. Committee members absent were Vice Chair Ayala, Directors Cate, Croucher, and Simpson. Also present were Directors Arant, Barnum, Butkiewicz, Cherashore, Fong-Sakai, Hall, Hedberg, Heinrichs, Hogan, Lewinger, Madaffer, Miller, Mosca, and Steiner. At that time, there was a quorum of the Board and the meeting was conducted as a meeting of the Board; however, only committee members participated in the vote.
Staff present was Acting General Manager Kerl, General Counsel Hattam, Assistant General Managers Cushman and Denham, Director of Finance/Treasurer Harris, Controller Woidzik, Budget and Analysis Manager Whyte, Rate and Debt Manager Rossum, Administrative Services Director Foster, Acting Information Systems Manager Bartolome, Acting Special Projects Manager Spaniol, and Acting Human Resources Manager Kite.
ADDITIONS TO AGENDA There were no additions to the agenda.
PUBLIC COMMENT There were no members of the public who wished to speak.
CHAIR’S REPORT Chair Hilliker announced the appointment of Dan Constantineau as the Water Authority’s first-ever Information Security Officer (ISO), effective March 11, 2019. He also noted that the olive trees in the parking lot and surrounding area of the San Diego County Water Authority Kearny Mesa office would be removed.
* Directors Evans arrived at 9:05 a.m.
DIRECTORS’ COMMENTS There were no Directors’ comments.
I. CONSENT CALENDAR 1. Monthly Treasurer’s Report on Investments and Cash Flow. Staff recommendation: Note and file the Treasurer’s report.
2. Resolution amending the titles of authorized officers and employees to invest monies in the Local Agency Investment Fund (LAIF).
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Staff recommendation: Adopt Resolution No. 2019-05 amending the titles of authorized officers and employees to invest monies in the Local Agency Investment Fund (LAIF).
3. Board Approval to Appoint Acting General Manager Sandra L. Kerl as Co-Trustee to the Hans and Margaret Doe Charitable Trust. Staff recommendation: Approve the appointment of Acting General Manager Sandra L. Kerl as Co-Trustee to the Hans and Margaret Doe Charitable Trust and then as a Fund Advisor to a Donor advised fund (DAF) at The San Diego Foundation once the transition to such DAF is completed.
4. Amendments to extend the standby confined space rescue service contracts with Capstone Fire Management, Inc. and Total Safety US, Inc. Staff recommendation: Amend the contracts with Capstone Fire Management, Inc. and Total Safety US, Inc., for continued services to the Water Authority through December 31, 2020 by $120,000 each, for a period of 12 additional months; increasing total contract funding to an amount not to exceed $270,000 per contract.
5. Amendment to extend the agreement with Industrial Scientific Corporation for Lease of Air/Gas Monitoring Equipment System. Staff recommendation: Amend the agreement with Industrial Scientific Corporation for continued services to the Water Authority through October 31, 2020 by $51,933.29, for a period of 12 additional months; increasing total contract funding to an amount not to exceed $193,897.87.
Director Saxod moved, Director Katz seconded, and the motion to approve staffs’ recommendations passed unanimously.
II. ACTION/DISCUSSION/PRESENTATION 1. Administrative and Finance Committee Work Plan for Calendar Years 2019 and 2020. Administrative and Finance Committee Chair and Vice Chairs’ recommendation: Adopt the Administrative and Finance Committee Work Plan for Calendar Years 2019 and 2020.
Chair Hilliker stated that the draft work plan was provided for review and comment at the February 28, 2019 committee meeting. Items on the final work plan were presented.
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Director Katz moved, Director Murtland seconded, and the motion to approve the Administrative and Finance Committee Chair and Vice Chairs’ recommendation passed unanimously.
2. Web/Geographic Information Systems Application Development.
Mr. Bartolome provided a presentation on the development of the Web/Geographic Information Systems Application that included an overview of the application, staff involvement, applications under development, various tracking systems such as CIP dashboard, Online Water Ordering, Water Standby Charge, and Business Plan goals.
Directors asked questions and staff provided answers.
Acting General Manager Kerl and Chair Hilliker commended staff involved for their work on the Web/Geographic Information System.
3. Controller’s Report on Monthly Financial Activity.
Mr. Woidzik presented on the Monthly Financial Reports covering FY 2018 and 2019 results summary, FY 2018 and 2019 actual and budget comparison, water sales volumes, water sales revenues, and water purchases and treatment costs.
III. INFORMATION The following Information item was received and filed: 1. Board Calendar.
IV. CLOSED SESSION Mr. Hattam took the committee into Closed Session at 9:30 a.m.
1. Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) Williams v. San Diego County Water Authority; San Diego Superior Court Case No. 37-2019-00010682-CU-WM-CTL
2. Conference with the Labor Negotiator Government Code §54957.6 Agency Designated Representatives: Gretchen Spaniol, Jason Foster, Rick Bolanos Employee Organization: Teamsters Local 911
Mr. Hattam brought the committee out of Closed Session at 10:07 a.m. and stated the Administrative and Finance Committee recommended that the board approve direction to engage counsel Liebert Cassidy and defend Williams v. San Diego County Water Authority, an employment related action in San Diego Superior Court.
Page 124 of 146 Formal Board Agenda Item Number 5 April 25, 2019 (March 28, 2019 minutes) V. ADJOURNMENT There being no further business to come before the Administrative and Finance Committee, Chair Hilliker adjourned the meeting at 10:08 a.m.
LEGISLATION AND PUBLIC OUTREACH COMMITTEE CALL TO ORDER/ROLL CALL Chair Butkiewicz called the Legislation and Public Outreach Committee to order at 10:18 a.m. Committee members present were Chair Butkiewicz, Vice Chairs Hall and Katz, and Directors Cherashore, Croucher, Kennedy, Leonard, Madaffer, Miller, Mosca and Steiner. Committee members absent were Directors Guerin, Hilliker, Masson and Supervisor Desmond. Also, present were Directors Arant, Barnum, Bebee, Boyle, Evans, Fong-Sakai, Hedberg, Heinrichs, Hogan, Lewinger, Murtland, Saxod, Smith, Udrys, Watkins, and Wilson. At that time, there was a quorum of the Board, and the meeting was conducted as a meeting of the Board; however, only committee members participated in the vote.
Staff present was Acting General Manager Kerl, General Counsel Hattam, Assistant General Managers Cushman and Denham, Director of Public Outreach and Conservation Vedder, Government Relations Manager Farrel, Public Affairs Supervisor Penunuri, and Public Affairs Representative Balben.
ADDITIONS TO AGENDA There were no additions to the agenda.
PUBLIC COMMENT There were no members of the public who wished to speak.
CHAIR’S REPORT Chair Butkiewicz informed the Board that Board Chair Madaffer, LPO Vice Chair Katz, Director Croucher and himself would be traveling to Sacramento to visit with members of the San Diego legislative delegation on April 1, 2019.
DIRECTORS’ COMMENTS There were no Directors’ comments.
I. CONSENT CALENDAR 1. Adopt positions on various state bills. Staff recommendations: 1-A Adopt a position of Support on AB 292 (Quirk), relating to recycled water definitions. 1-B Adopt a position of Support on AB 533 (Holden), relating to income tax exclusion for water efficiency rebates. 1-C Adopt a position of Support on AB 557 (Wood), relating to state funding for atmospheric rivers research. 1-D Adopt a position of Support if Amended on SB 45 (Allen), relating to the Wildfire, Drought, and Flood Protection Bond Act of 2020.
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1-E Adopt a position of Support and Seek Amendments on SB 204 (Dodd), relating to legislative oversight and transparency of State Water Project contract amendments and renewals. 1-F Adopt a position of Support on SB 772 (Bradford), relating to procurement of long-duration bulk energy storage.
Director Steiner moved, Director Mosca seconded, and the motion to approve staffs’ recommendations passed unanimously.
Director Lewinger requested that staff return with an analysis of previous bond actions by the Water Authority.
II. ACTION/DISCUSSION/PRESENTATION 1. Legislation and Public Outreach Committee Work Plan for Calendar Years 2019 and 2020. Legislation and Public Outreach Committee Chair and Vice Chairs’ recommendation: Adopt the Legislation and Public Outreach Committee Work Plan for Calendar Years 2019 and 2020.
Ms. Vedder presented a review of the committee Work Plan for calendar years 2019 and 2020.
Vice Chair Katz moved, Director Miller seconded, and the motion to approve the Legislation and Public Outreach Committee Chair and Vice Chairs’ recommendation passed unanimously.
2. Adopt positions on safe drinking water legislation. Staff recommendation: Adopt positions on four safe drinking water legislative proposals that, if taken together, would constitute a comprehensive, interrelated package of bills designed to resolve complex challenges associated with providing a safe and reliable water supply for disadvantaged communities in the Central and Salinas Valleys.
2-A Adopt a position of Oppose Unless Amended on SB 200 (Monning), relating to the creation of a Safe and Affordable Drinking Water Fund. 2-B Adopt a position of Support on SB 414 (Caballero), relating to creation of the Small System Water Authority Act of 2019. 2-C Adopt a position of Support on SB 669 (Caballero), relating to creation of a Safe Drinking Water Trust Fund. 2-D Adopt a position of Oppose Unless Amended on the Administration’s Budget Trailer Bill: Environmental Justice – Safe and Affordable Drinking Water and Exide Cleanup – dated February 1, 2019, which would impose a tax on water and agricultural production activities to finance a safe and affordable drinking water program.
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2-E Direct the Water Authority staff and legislative advocates to encourage legislative leadership to have these four measures, as proposed to be amended, considered as an interrelated package of bills within the context of a conference committee or similar legislative mechanism.
Mr. Farrel provided an overview of the current administration’s and legislature’s approach on addressing safe and affordable drinking water legislation, and problems that have been identified.
Director Steiner moved, Director Madaffer seconded, and the motion to approve staffs’ recommendation passed unanimously.
3. Support Request for State Assistance by Paradise Irrigation District. Staff recommendation: Adopt resolution in support of a financial assistance request of $21.7 million over three years from the State general fund by the Paradise Irrigation District to sustain the district’s operational costs and expenses, in response to the devastating effects of the Camp Fire that have resulted in overwhelming property losses suffered by the district.
Mr. Farrel provided a summary of the Camp Fire and its effects on the Paradise Irrigation District.
Director Kennedy moved, Director Mosca seconded, and the motion to approve staffs’ recommendation passed unanimously.
4. Legislative issues. 4-A Washington report by Ken Carpi. 4-B Sacramento Report.
Mr. Farrel provided a Sacramento report which included an update on status of Water Authority Sponsored bills and other key measures.
5. 2019 Public Opinion Poll Focus Areas.
Ms. Vedder and Mr. Balben provided the Board with an overview of the 2019 public opinion poll including the purpose, methodology overview, schedule, and recommended topics.
6. Small Contractor Outreach and Opportunities Program (SCOOP) Mid-Year Update.
Ms. Penunuri presented the Board with the FY 2019 mid-year update for the SCOOP program, which included program goals and events attended.
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III. INFORMATION The following Information item was received and filed: 1. Government Relations Update.
IV. CLOSED SESSION There were no Closed Session items.
V. ADJOURNMENT There being no further business to come before the Legislation and Public Outreach Committee, Chair Butkiewicz adjourned the meeting at 11:24 a.m.
ENGINEERING AND OPERATIONS COMMITTEE CALL TO ORDER / ROLL CALL Chair Miller called the Engineering and Operations Committee meeting to order at 11:30 a.m. Committee members present were Chair Miller, Vice Chairs Fong-Sakai and Watkins, and Directors Arant, Bebee, Hedberg, Heinrichs, Mosca, Murtland, Preciado, Smith, Steiner, and Udrys. Committee members absent were Directors Scalzitti and Simpson. Also present were Directors Barnum, Butkiewicz, Evans, Hall, Hogan, Katz, Leonard, Lewinger, and Wilson. At that time, there was a quorum of the Board, and the meeting was conducted as a meeting of the Board; however, only committee members participated in the vote.
Staff present was Acting General Manager Kerl, General Counsel Hattam, Assistant General Managers Cushman and Denham, Director of Operations and Maintenance Fisher, Director of Engineering Reed, Deputy Director of Engineering Bousquet, Principal Engineer Fountain, and Senior Engineer Trimm.
ADDITIONS TO AGENDA There were no additions to the agenda.
PUBLIC COMMENT There were no members of the public who wished to speak.
DIRECTORS’ COMMENTS There were no Directors’ comments.
CHAIR’S REPORT Chair Miller stated a Special Engineering and Operations Committee meeting was held March 14, 2019 regarding the history of the Water Authority’s Capital Improvement Program. The meeting provided an overview of how the Water Authority’s CIP budget was developed, a discussion of current challenges the public works construction industry was facing locally along with potential mitigation measures for construction cost increases, and a preview of what to expect in the CIP budget for Fiscal Years 2020/2021 and beyond.
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Chair Miller announced the Escondido Space Needs Subcommittee held two meetings to review and discuss space needs for the Operations and Maintenance Department. He stated a full report would be provided at the April 25, 2019 Board meeting, and tour dates would be provided for anyone interested in seeing the Escondido Operations Center facility.
I. CONSENT CALENDAR 1. Notice of Completion for the Kearny Mesa Headquarters Roof Rehabilitation project. Staff recommendations: Authorize the General Manager to accept the Kearny Mesa Headquarters Roof Rehabilitation project as complete, record the Notice of Completion, and release all funds held in retention to Sylvester Roofing Co., Inc. following the expiration of the retention period.
Director Steiner moved, Director Hedberg seconded, and the motion to approve staffs’ recommendation passed unanimously.
II. ACTION/DISCUSSION/PRESENTATION 1. Engineering and Operations Committee Work Plan for calendar years 2019 and 2020. Committee Chair and Vice Chairs’ recommendation: Adopt the Engineering and Operations Committee Work Plan for calendar years 2019 and 2020.
Chair Miller presented highlights of the Engineering and Operations Committee Work Plan for Calendar Years 2019 and 2020. Highlights for Engineering included: constructing the Pipeline 5 Relining Delivery Point to Sage Road project, constructing the San Diego 28 Flow Control Facility Rehabilitation project, and facilitating regulatory and legislative actions which support San Vicente Energy Storage Project and continue the development of the Project Development Agreement. Highlights for Operations and Maintenance included: developing the Lake Hodges Hydroelectric Facility Maintenance and Replacement Plan and implementing identified physical security recommendations for critical facilities for continued water system protection against potential threats.
Director Heinrichs moved, Director Fong-Sakai seconded, and the motion to approve the Engineering and Operations Committee Chair and Vice Chairs’ recommendation passed unanimously.
2. San Vicente Project Negotiations Work Group update.
Director Heinrichs provided an update on the San Vicente Project Negotiations Work Group. He reported that project team members traveled to Sacramento on March 11, 2019 to discuss their white paper on Pumped Storage. City and Water Authority project team members, including government relations staff, and the paper’s primary author Dr. David Victor, provided an advanced copy of the white paper on pumped storage to key contacts in Sacramento. Staff met with Executive Directors of California Municipal Utilities Association (CMUA) and the
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Center for Energy Efficiency and Renewable Technologies (CEERT). The team also briefed the City of San Diego mayor’s office who would take the lead to offer project/white paper briefings to City Council members, and the project team was standing by to provide Council briefings as-needed. Staff were provided updated copies of the white paper and would schedule Dr. Victor to provide an overview of issues discussed within the paper at a future committee meeting.
3. San Diego 28 Flow Control and Alvarado Hydroelectric Facilities Project Update.
Mr. Fountain presented information on the San Diego 28 Flow Control and Alvarado Hydroelectric Facilities Project including history on the Alvarado Hydroelectric facility, San Diego 12 August 2016 repairs and interim modifications, rehabilitation design, bidding and analysis, and project packages. He concluded the presentation with a timeline for the San Diego 28 package, and the Alvarado Hydroelectric Equipment.
III. INFORMATION There were no Information items.
IV. CLOSED SESSION Mr. Hattam took the committee in Closed Session at 11:54 a.m.
1. Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) William J. Kimball and Diana Kimball, as Trustees of the William J. Kimball and Diana L. Kimball Living Trust dated October 29, 1992 v. Bryan J. Holland, Teresa K. Holland, and SDCWA; San Diego Superior Court Case No. 37-2018-00036570- CU-OR-CTL 2. Conference with Legal Counsel – Anticipated Litigation Government Code §54956.9(d)(4) Initiation of Litigation / One Case
Mr. Hattam brought the committee out of Closed Session at 12:05 p.m. and reported that the Board approved direction to engage counsel and initiate an action, and the action, the defendants, and the other particulars shall, once formally commenced, be disclosed to any person upon inquiry, unless to do so would jeopardize the agency's ability to effectuate service of process on one or more unserved parties, or that to do so would jeopardize its ability to conclude existing settlement negotiations to its advantage.
V. ADJOURNMENT There being no further business to come before the Engineering and Operations Committee, Director Miller adjourned the meeting at 12:06 p.m.
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IMPORTED WATER COMMITTEE CALL TO ORDER / ROLL CALL Chair Lewinger called the Imported Water Committee meeting to order at 1:02 p.m. Committee members present were Chair Lewinger, Vice Chairs Barnum and Cherashore, and Directors Evans, Fong-Sakai, Hall, Hogan, Madaffer, Morrison, Preciado, and Saxod. Committee members absent were Directors Guerin, Masson, and Scalzitti. Also present were Directors Arant, Bebee, Boyle, Butkiewicz, Croucher, Hedberg, Heinrichs, Katz, Kennedy, Leonard, Miller, Mosca, Murtland, Smith, Steiner, Udrys, Watkins, and Wilson. At that time, there was a quorum of the Board and the meeting was conducted as a meeting of the Board; however, only committee members participated in the vote.
Staff present was Acting General Manager Kerl, General Counsel Hattam, Assistant General Managers Cushman and Denham, MWD Program Director Chen, Colorado River Program Director Rodgers, and QSA Outreach Coordinator Simon.
ADDITIONS TO AGENDA There were no additions to the agenda.
PUBLIC COMMENT There were no members of the public who wished to speak.
CHAIR’S REPORT Chair Lewinger provided information on the impacts caused by recent wet weather to DWR’s allocations to the State Water Project and the water levels of Lake Oroville, and the status of DWR’s claims for FEMA reimbursement for the 2017 Oroville Dam incident.
DIRECTORS’ COMMENTS There were no Directors’ comments.
I. CONSENT CALENDAR There were no items on the Consent Calendar.
II. ACTION/DISCUSSION/PRESENTATION 1. Imported Water Committee Work Plan for Calendar Years 2019 and 2020. Imported Water Committee Chair and Vice Chairs’ recommendation: Adopt the Imported Water Committee Work Plan for Calendar Years 2019 and 2020.
Director Hall moved, Director Preciado seconded, and the motion to approve the Imported Water Committee Chair and Vice Chairs’ recommendation passed unanimously.
2. MWD Issues and Activities Update. 2-A Metropolitan Water District Delegates Report.
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The Delegates reported on discussion and action taken at the recent MWD Board meetings.
2-B Bay Delta Flows and Other Updates.
Ms. Chen provided a presentation that included information on sources of the County’s current water supply, the Water Authority’s current position on California WaterFix, new developments on the Central Valley Project and State Water Project operations, Governor Newsom’s new direction, and next steps.
Vice Chair Barnum left the meeting at 1:15 p.m.
3. Colorado River Programs. 3-A Colorado River Board Representative’s report.
Director Wilson reported on discussion and action taken at the recent Colorado River Board meetings.
3-B Drought Contingency Plan.
Ms. Rodgers provided a presentation that included information on recent activities, activities by the Seven Basin States leading to the March 19, 2019 Federal Deadline, pending work to be completed, and next steps.
4. Imperial Valley Outreach Update.
Mr. Simon provided a presentation that included information on the history of outreach activities in Imperial Valley, initial outreach efforts, past strategies, new perspectives, and current approach and focus areas.
5. Salton Sea Management Program Update.
Mr. Simon provided a presentation that included information on the state’s Salton Sea Management Program and discussion and activities of the March 19, 2019 State Water Board Workshop on the Salton Sea.
III. INFORMATION The following Information item was received and filed: 1. Metropolitan Water District Program Report.
IV. CLOSED SESSION Mr. Hattam took the committee into Closed Session at 1:30 p.m.
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1. Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) SDCWA v. Metropolitan Water District of Southern California; San Francisco Superior Court Case Nos. CPF-10-510830; CPF-12-512466; CPF- 14-514004; CPF-16-515282; CPF-16-515391; CGC-17-563350; CPF-18- 516389; California Court of Appeal (1st District) Case Nos. A146901; A148266; A154325; California Supreme Court Nos. S243500; and S251025
2. Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) California Department of Water Resources v. All Persons Interested; Sacramento Superior Court Case No. 34-2017-00215965-CU-MC-GDS; and JCCP 4942
3. Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) Food & Water Watch and Center for Food Safety v. Metropolitan Water District of Southern California and All Persons Interested in the Matter; Los Angeles Superior Court Case No. BC 720692
Mr. Hattam brought the committee out of Closed Session at 2:25 p.m. and stated there was no reportable action.
V. ADJOURNMENT There being no further business to come before the Imported Water Committee, Chair Lewinger adjourned the meeting at 2:26 p.m.
WATER PLANNING COMMITTEE CALL TO ORDER/ROLL CALL Chair Heinrichs called the Water Planning and Environmental Committee meeting to order at 2:31 p.m. Committee members present were Chair Heinrichs, Vice Chairs Boyle and Wilson, and Directors Arant, Bebee, Butkiewicz, Hedberg, Hogan, Kennedy, Lewinger, and Morrison. Committee members absent were Directors Ayala, Barnum, Cate, and Supervisor Desmond. Also present were Directors Cherashore, Fong-Sakai, Hall, Katz, Leonard, Miller, Mosca, Murtland, Preciado, Saxod, Smith, Udrys, and Watkins. At that time, there was a quorum of the Board, and the meeting was conducted as a meeting of the Board; however, only committee members participated in the vote.
Staff present was Acting General Manager Kerl, General Counsel Hattam, Assistant General Managers Cushman and Denham, Director of Water Resources Gage, Director of Public Outreach and Conservation Vedder, and Water Resources Specialists German and Schnell.
Page 133 of 146 Formal Board Agenda Item Number 5 April 25, 2019 (March 28, 2019 minutes) ADDITIONS TO THE AGENDA There were no additions to the agenda.
PUBLIC COMMENT There were no members of the public who wished to speak.
CHAIR’S REPORT Chair Heinrichs welcomed everyone in attendance.
DIRECTORS’ COMMENTS There were no Directors’ comments.
I. CONSENT CALENDAR There were no Consent Calendar items.
II. ACTION/DISCUSSION/PRESENTATIONS 1. Water Planning and Environmental Committee Work Plan for Calendar Years 2019 and 2020. Water Planning and Environmental Committee Chair and Vice Chairs’ recommendation: Adopt the Water Planning and Environmental Committee Work Plan for Calendar Years 2019 and 2020.
Chair Heinrichs presented highlights of the final Work Plan, including development of a new Water Resources database and water billing system, providing input and direction to staff on the 2020 Urban Water Management and Water Shortage Contingency Plans, and considering approval of the Integrated Regional Water Management and Climate Action Plan Updates.
Vice Chair Boyle moved, Director Kennedy seconded, and the motion to approve the Water Planning and Environmental Committee Chair and Vice Chairs’ recommendation passed unanimously.
2. Update on water supply conditions.
Ms. Schnell provided a brief update on water supply conditions including Northern Sierra snowpack levels, Lake Oroville and San Luis reservoir storage volumes, an overview of the upper Colorado River basin, and an update on local conditions.
3. MWD Member Agency Administered Program (MAAP) Update.
Ms. German provided a brief update on Metropolitan Water District’s Member Agency Administered Program (MAAP). She provided an explanation of MAAP funding and overviews of agency projects, including the Drought Tolerant Plant Voucher Program, WaterSmart Landscape Contest website, Sustainable Demonstration Garden upgrade, and Residential Pressure Regulation Pilot Program.
Page 134 of 146 Formal Board Agenda Item Number 5 April 25, 2019 (March 28, 2019 minutes) III. INFORMATION The following Information item was received and filed: 1. Water Resources report.
IV. ADJOURNMENT There being no further business to come before the Water Planning and Environmental Committee, Chair Heinrichs adjourned the meeting at 2:51 p.m.
FORMAL BOARD OF DIRECTORS’ MEETING OF MARCH 28, 2019 1. CALL TO ORDER Chair Madaffer called the Formal Board of Directors’ meeting to order at 3:00 p.m.
2. SALUTE TO THE FLAG Director Heinrichs led the salute to the flag.
3. ROLL CALL, DETERMINATION OF QUORUM Vice Chair Croucher called the roll. Directors present were Arant, Bebee, Boyle, Butkiewicz, Cherashore, Croucher, Evans, Fong-Sakai, Hall, Hedberg, Heinrichs, Hogan, Katz, Kennedy, Leonard, Lewinger, Madaffer, Miller, Morrison, Mosca, Murtland, Preciado, Saxod, Smith, Steiner, Udrys, Watkins, and Wilson. Directors absent were Ayala, Barnum, Cate, Guerin, Hilliker, Masson, Scalzitti(p), Simpson, and Supervisor Desmond.
3-A Report on proxies received. Director Hedberg was the proxy for Director Scalzitti.
4. ADDITIONS TO AGENDA Vice Chair Croucher provided a brief health update on Secretary Guerin.
5. APPROVAL OF MINUTES Director Butkiewicz moved, Director Evans seconded, and the motion carried at 90.87% of the vote to approve the minutes of the Formal Board of Directors’ meeting of February 28, 2019.
6. OPPORTUNITY FOR MEMBERS OF THE PUBLIC WHO WISH TO ADDRESS THE BOARD ON MATTERS WITHIN THE BOARD’S JURISDICTION. There were no members of the public who wished to speak.
7. PRESENTATIONS & PUBLIC HEARINGS 7-A Comments by Metropolitan Water District Chair Gloria Gray.
Chair Madaffer introduced MWD Chair Gloria Gray to the Board. Ms. Gray thanked the Water Authority for the invitation and expressed her appreciation for all the hard work of the MWD Delegates over the years. She spoke on the shared goal of settling litigation and moving forward with our mutual commitment of providing a safe and reliable water
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supply to the region. She spoke briefly on issues shared by our agencies including rising construction costs and aging infrastructure, an aging workforce, population growth, local supply development focus, and resource conservation. She thanked the Board for support regarding MWD’s Drought Contingency Plan, and encouraged the work being done on recycled water programs. She also spoke briefly on the California WaterFix and the importance of modernizing the State Water Project conveyance system. In closing, Ms. Gray congratulated the Water Authority on the upcoming 75th anniversary and stated her desire to move forward collaboratively.
Chair Madaffer thanked Ms. Gray for attending and shared that he looked forward to working together to achieve mutual goals.
7-B Retirement of Director. Adopt Resolution No. 2019-07 honoring Mark Muir upon his retirement from the Board of Directors.
Director Croucher moved, Director Mosca seconded, and the motion carried at 90.87% of the vote to adopt Resolution 2019-07.
8. REPORTS BY CHAIRS 8-A Chairs report: Chair Madaffer congratulated Assistant General Manager Cushman on his retirement from the Water Authority after more than 20 years of service to the agency. He reviewed his many accomplishments and contributions and wished him the best in his retirement.
Mr. Cushman thanked Chair Madaffer for his comments and spoke briefly on his history with the Water Authority and the board meeting that initiated conversations, and the actions that followed, to diversify the water supply for the San Diego Region.
Chair Madaffer continued his report with an announcement that on March 23, 2019, 49 community leaders graduated from the Citizens Water Academy, including six elected officials from the region. He added that nearly 650 graduates have completed the program, and he shared a short video of the academy with the Board. He announced that the next class was for Public Agency employees and would be held July 10 and 17, with nominations for attendees to open on May 20, 2019. He added that there would also be a fall 2019 class in East County, in partnership with Helix Water District.
Chair Madaffer spoke briefly on the Drought Contingency Plan Congressional Hearings.
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8-B Report by Committee Chairs: Administrative and Finance Committee. Director Leonard reviewed the meeting and the action taken. Legislation and Public Outreach Committee. Director Butkiewicz reviewed the meeting and the action taken. Engineering and Operations Committee. Director Miller reviewed the meeting and the action taken. Imported Water Committee. Director Lewinger reviewed the meeting and the action taken. Water Planning and Environmental Committee. Director Heinrichs reviewed the meeting and the action taken.
9. CONSENT CALENDAR Director Katz moved, Director Murtland seconded, and the motion carried at 90.87% of the vote to approve the Consent Calendar. Directors voting no, or abstaining are listed under the item.
9- 1. Monthly Treasurer’s Report on Investments and Cash Flow. The Board noted and filed the Treasurer’s report.
9- 2. Resolution amending the titles of authorized officers and employees to invest monies in the Local Agency Investment Fund (LAIF). The Board adopted Resolution No. 2019-05 amending the titles of authorized officers and employees to invest monies in the Local Agency Investment Fund (LAIF).
9- 3. Board Approval to Appoint Acting General Manager Sandra L. Kerl as Co-Trustee to the Hans and Margaret Doe Charitable Trust. The Board approved the appointment of Acting General Manager Sandra L. Kerl as Co-Trustee to the Hans and Margaret Doe Charitable Trust and then as a Fund Advisor to a donor advised fund (DAF) at The San Diego Foundation once the transition to such DAF is completed.
9- 4. Amendments to extend the standby confined space rescue service contracts with Capstone Fire Management, Inc. and Total Safety US, Inc. The Board approved amending the contracts with Capstone Fire Management, Inc. and Total Safety US, Inc., for continued services to the Water Authority through December 31, 2020 by $120,000 each, for a period of 12 additional months; increasing total contract funding to an amount not to exceed $270,000 per contract.
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9- 5. Amendment to extend the agreement with Industrial Scientific Corporation for Lease of Air/Gas Monitoring Equipment System. The Board approved amending the agreement with Industrial Scientific Corporation for continued services to the Water Authority through October 31, 2020 by $51,933.29, for a period of 12 additional months; increasing total contract funding to an amount not to exceed $193,897.87.
9- 6. Administrative and Finance Committee Work Plan for Calendar Years 2019 and 2020. The Board adopted the Administrative and Finance Committee Work Plan for Calendar Years 2019 and 2020.
9-A. Closed Session. The Board approved direction to engage counsel Liebert Cassidy and defend Williams v. San Diego County Water Authority, an employment-related action in San Diego Superior Court.
9- 7. Adopt positions on various state bills. The Board adopted a position of Support on AB 292 (Quirk), relating to recycled water definitions; a position of Support on AB 533 (Holden), relating to income tax exclusion for water efficiency rebates; a position of Support on AB 557 (Wood), relating to state funding for atmospheric rivers research; a position of Support if Amended on SB 45 (Allen), relating to the Wildfire, Drought, and Flood Protection Bond Act of 2020; a position of Support and Seek Amendments on SB 204 (Dodd), relating to legislative oversight and transparency of State Water Project contract amendments and renewals; and a position of Support on SB 772 (Bradford), relating to procurement of long-duration bulk energy storage.
9- 8. Legislation and Public Outreach Committee Work Plan for Calendar Years 2019 and 2020. The Board adopted the Legislation and Public Outreach Committee Work Plan for Calendar Years 2019 and 2020.
9- 9. Adopt positions on safe drinking water legislation. The Board adopted a position of Oppose Unless Amended on SB 200 (Monning), relating to the creation of a Safe and Affordable Drinking Water Fund; a position of Support on SB 414 (Caballero), relating to creation of the Small System Water Authority Act of 2019; a position of Support on SB 669 (Caballero), relating to creation of a Safe Drinking Water Trust Fund; a position of Oppose Unless Amended on the Administration’s Budget Trailer Bill: Environmental Justice – Safe and Affordable Drinking Water and Exide Cleanup – dated February 1, 2019, which would impose a tax on water and agricultural production activities to finance a safe and affordable drinking water program; and directed the Water Authority staff and legislative advocates to encourage legislative leadership to have these four
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measures, as proposed to be amended, considered as an interrelated package of bills within the context of a conference committee or similar legislative mechanism.
9-10. Support Request for State Assistance by Paradise Irrigation District. The Board adopted a resolution in support of a financial assistance request of $21.7 million over three years from the State general fund by the Paradise Irrigation District to sustain the district’s operational costs and expenses, in response to the devastating effects of the Camp Fire that have resulted in overwhelming property losses suffered by the district.
9-11. Notice of Completion for the Kearny Mesa Headquarters Roof Rehabilitation project. The Board authorized the General Manager to accept the Kearny Mesa Headquarters Roof Rehabilitation project as complete, record the Notice of Completion, and release all funds held in retention to Sylvester Roofing Co, Inc. following the expiration of the retention period.
9-12. Engineering and Operations Committee Work Plan for Calendar Years 2019 and 2020. The Board adopted the Engineering and Operations Committee Work Plan for Calendar Years 2019 and 2020.
9-B. Closed Session. The Board approved direction to engage counsel and initiate an action, and the action, the defendants, and the other particulars shall, once formally commenced, be disclosed to any person upon inquiry, unless to do so would jeopardize the agency's ability to effectuate service of process on one or more unserved parties, or that to do so would jeopardize its ability to conclude existing settlement negotiations to its advantage.
9-13. Imported Water Committee Work Plan for Calendar Years 2019 and 2020. The Board adopted the Imported Water Committee Work Plan for Calendar Years 2019 and 2020.
9-14. Water Planning and Environmental Committee Work Plan for Calendar Years 2019 and 2020. The Board adopted the Water Planning and Environmental Committee Work Plan for Calendar Years 2019 and 2020.
10. ACTION/DISCUSSION 10-A General Manager Recruitment Process.
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Chair Madaffer introduced Acting Human Resources Director Kite to the Board. Ms. Kite reviewed the process involved for the recruitment and selection process of the General Manager, including work completed by the work group, next steps and timeline.
Chair Madaffer provided comments on the process.
Director Arant requested the workgroup return to the Board during the process with criteria and characteristics applied for determining the final candidates.
Director Lewinger asked for clarification of the role played by stakeholders in the recruitment process as opposed to the Board role. Chair Madaffer responded that the role of stakeholders would be advisory, prior to the final candidate interviews with the Board.
11. SPECIAL REPORTS 11-A GENERAL MANAGER’S REPORT – Ms. Kerl reminded the Board of the Special Imported Water Committee meeting on April 11, 2019 at 1:30 p.m.
11-B GENERAL COUNSEL’S REPORT – Mr. Hattam stated he had nothing further to report.
11-C SANDAG REPORT – Director Morrison reported on discussion and action taken at the recent SANDAG meetings, and the SANDAG Board Retreat. SANDAG Subcommittees: Borders Committee – Director Saxod reported on discussion and action taken at the recent SANDAG Borders Committee meeting.
Director Preciado requested information regarding the Water Authority’s engagement with SANDAG and the role of the Water Authority on SANDAG committees.
Regional Planning Committee – Director Leonard stated the meeting had not yet taken place.
11-D AB 1234 Compliance Reports – No reports were given.
12. CLOSED SESSION(S) Mr. Hattam announced there was no need for Closed Session.
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12-A Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) Williams v. San Diego County Water Authority; San Diego Superior Court Case No. 37-2019-00010682-CU-WM-CTL
12-B Conference with the Labor Negotiator Government Code §54957.6 Agency Designated Representatives: Gretchen Spaniol, Jason Foster, Rick Bolanos Employee Organization: Teamsters Local 911
12-C Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) William J. Kimball and Diana Kimball, as Trustees of the William J. Kimball and Diana L. Kimball Living Trust dated October 29, 1992 v. Bryan J. Holland, Teresa K. Holland, and SDCWA; San Diego Superior Court Case No. 37-2018-00036570-CU-OR-CTL
12-D Conference with Legal Counsel – Anticipated Litigation Government Code §54956.9(d)(4) Initiation of Litigation / One Case
12-E Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) SDCWA v. Metropolitan Water District of Southern California; San Francisco Superior Court Case Nos. CPF-10-510830; CPF-12-512466; CPF- 14-514004; CPF-16-515282; CPF-16-515391; CGC-17-563350; CPF-18- 516389; California Court of Appeal (1st District) Case Nos. A146901; A148266; A154325; California Supreme Court Case Nos. S243500; and S251025
12-F Conference with Legal Counsel – Existing Litigation Government Code §54956.9(d)(1) California Department of Water Resources v. All Persons Interested; Sacramento Superior Court Case No. 34-2017-00215965-CU-MC-GDS; and JCCP 4942
12-G Conference with Legal Counsel – Existing Litigation Government Code §§54956.9(d)(1) Food & Water Watch and Center for Food Safety v. Metropolitan Water District of Southern California and All Persons Interested in the Matter; Los Angeles Superior Court Case No. BC 720692
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13. ACTION FOLLOWING CLOSED SESSION
14. OTHER COMMUNICATIONS Director Hogan introduced Mr. Albert Lau, the newly appointed General Manager to the Santa Fe Irrigation District.
15. ADJOURNMENT There being no further business to come before the Board, Chair Madaffer adjourned the meeting at 3:52 p.m.
______Jim Madaffer, Chair Gary Croucher, Vice Chair
______Melinda Nelson, Clerk of the Board
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April 17, 2019
Attention: Board of Directors
General Counsel’s Report – March/April 2019
Purpose This report discusses certain meaningful legal matters receiving attention during the months of March/April 2019.
Significant Developments in Pending Litigation
MWD Rate Cases
2010/2012 Rate Cases: After being remitted to the trial court in San Francisco by the Court of Appeal on October 24, 2017, these consolidated cases are now pending before Judge Mary Wiss.
On July 25, 2018, Judge Wiss issued an order defining the scope of the case on remand. In that order, she ruled that (1) on its contract claim, the Water Authority is entitled to damages of $28,678,191, plus prejudgment interest; (2) the Water Authority is entitled to declaratory relief, and may be entitled to monetary restitution, for MWD's imposition of its illegal RSI clause and termination of Water Authority-related Local Resource Project contracts; and (3) the Water Authority waived, and thus may not litigate in the 2010/2012 case, the issue whether MWD was required to provide the Water Authority with a credit against Exchange Water wheeling charges for the offsetting benefits to MWD provided by the Exchange Water. On November 7, 2018, Judge Wiss set a schedule for deciding the scope of relief on the RSI claim, which included a one- week evidentiary hearing beginning on April 8, 2019.
In light of ongoing settlement discussions, the Water Authority proposed that the Court vacate the April 8 hearing date, and continue all deadlines, in order to provide the parties a 90-day litigation time-out in which to continue negotiating without the pressures of discovery and an upcoming hearing. MWD did not oppose. On February 5, 2019, the Court entered an order vacating all deadlines and setting the next case management conference for May 9, 2019.
2014 Rate Case: The case filed on May 30, 2014 challenging MWD’s rates adopted in 2014 for 2015 and 2016 was transferred to San Francisco Superior Court, assigned to Judge Curtis Karnow, and remains stayed. Because Judge Karnow was transferred out of the Complex Division, this case is now assigned to Judge Anne-Christine Massullo.
2016 Rate Case: The case filed on April 13, 2016 challenging MWD’s rates adopted in 2016 for 2017 and 2018 was transferred to San Francisco Superior Court and, following MWD’s exercise of a peremptory challenge against Judge Karnow, assigned to Judge Wiss. The 2016 case was initially stayed by the parties pending resolution of the 2010/2012 case appeal. The parties then
Page 143 of 146 Board of Directors General Counsel’s Report – March/April 2019 Page 2 agreed to a further stay pending resolution of post-remand proceedings in the 2010/2012 cases, which stay was entered by the Court on July 31, 2018.
2017 Rate Case: The case was filed in Los Angeles Superior Court on June 9, 2017, following MWD’s April 2017 approval of Readiness-to-Serve and Capacity Charges to be charged in 2018, and amended on July 18, 2017, after the MWD Board approved an amended RTS Charge for 2018. The case was transferred to San Francisco Superior Court, assigned to Judge Wiss, and stayed by stipulation of the parties on July 31, 2018.
2018 Rate Case: This case was filed in Los Angeles Superior Court on June 8, 2018, following MWD’s April 2018 approval of its rates and charges for 2019 and 2020. The case was transferred to San Francisco Superior Court on November 2, 2018; it has not been assigned to a judge. The Water Authority amended its complaint on January 31, 2019, to add claims for breach of contract. By stipulation of the parties, the case is now stayed pending resolution of the 2010/2012 cases.
Department of Water Resources v. All Persons Interested
The parties are working on administrative record and case management issues. The Water Authority continues to seek concurrence by DWR that the Water Authority’s issues of concern are not at issue in the case so that it may dismiss its Answer. The Validation Action remains in the record preparation stage because DWR disputes the majority of documents interested parties seek to include in the record. Also, some parties are asking for a stay of all proceedings based on the Governor’s intent to reduce the project to one tunnel. However, the Court has temporarily stayed the CEQA matters, awaiting further scope of WaterFix decisions by the State, and requested briefing on a potential similar stay for the validation case. There is a shorter stay on the validation matter pending further information from DWR.
Food & Water Watch and Center for Food Safety v. Metropolitan Water District of Southern California and All Persons Interested
On November 26 the Water Authority filed a Demurrer to the Complaint by Food and Water Watch, challenging the Complaint’s Proposition 26 claim against MWD. MWD also demurred, and Plaintiffs filed an amended Complaint. The Water Authority and MWD again filed demurrers, which were heard on March 15, 2019. The Water Authority and MWD’s pleading challenges were granted, and the case was dismissed without leave to amend. The decisions may be appealed.
Kimball Matter
This dispute over a real property conveyance was subject to a Demurrer filed by the Water Authority and set to be heard on December 7, 2018 in San Diego Superior Court. The Demurrer was granted, with leave to amend. The amended Complaint was filed, and the Water Authority again filed a demurrer seeking dismissal of the Water Authority from the case, which demurrer was heard on March 15, 2019. The Court sustained the Water Authority’s demurrer without leave to amend, and dismissed us from the case. The decision may be appealed.
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Amicus Issues
No new issues to report.
Requests Pursuant to the Public Records Act
Requestor Documents Requested
Voice of San Diego Responsive documents from MWD regarding MWD Purchasing of Delta Islands
SmartProcure Purchase orders dated 12-19-18 to current
City of Oceanside Easement use of Twin Oaks Valley Road owned by Northcutt Family granted to City of Oceanside
Center for Contract Compliance Bid documents for Alvarado-Hydroelectric Facility Rehabilitation
Center for Contract Compliance Bid documents for San Vicente Energy Storage Facilities
Sheppard Mullin Richter & Otay Landfill, Inc., information Hampton LLP
Prepared by: Mark J. Hattam, General Counsel
Attachment: Special Counsel Expenditure Report
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On-going Litigation Special Counsel Project Total $ Expended for Mar/Apr-19 (Fees & Costs) Brownstein Hyatt Farber Schreck MWD Rate Litigation Privileged 1 QSA Implementation Privileged Daley & Heft Kimball Matter Privileged Pipeline 3 Relining Project Privileged Keker Van Nest & Peters Metropolitan Rates Privileged Procopio Cory Hargreaves & Savitch DWR Validation Matter Privileged F&WW Validation Matter Privileged
Non-Litigation Special Counsel Project Total $ Expended for Mar/Apr-19 (Fees & Costs) Allen Matkins General Legal Services $164.70 (OP) San Vicente Pumped Storage Project $15,034.75 (CIP)
1 The California Supreme Court has held that the amounts of monthly legal bills for ongoing litigation have privileged status, as they may disclose litigation strategy. Los Angeles County Bd. of Supervisors v. Superior Court , (2016) 2 Cal. 5th 282, 286.
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