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Good afternoon, everyone. It's 12 o'clock and I will call the water conservation, water supply and demand management

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committee meeting to order. I'll start with roll call, please. Thank you chair, director Santos.

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Yes. Vice chair person, ballard, and director Shuai. Here. Thank you, you have a quorum. Thank you.

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time open for public comment on any item, not on the agenda. Do we have a request to speak

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to the committee?

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Thank you, Chair. I have no physical cards and I'm checking online. There are no hands

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where it's okay. Thank you. Item 3.1 approval of March 24, 2025 while the supply and

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management committee meeting minutes. Okay, we have a motion. Is there a second? Okay. On

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February say I, I, yeah, meeting minutes is approved. Okay. We're going on to our regular agenda

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items. We have by the field today, start with item 4.1. Receive information and discuss

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proposed storage projects, content in valley waters, water supply, and master plant 2050.

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Good afternoon, committee.

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Here's the services and officer for the water supply division.

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This is what's basically a question by the committee last time how Pacheco fits into storage.

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So we're going to start off with just generally storage, and Pacheco will have their presentation,

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and I'll turn this over to Jing Wu.

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Everyone, Tingu, Senior Water Resources Specialist with Water Supply Planning and Conservation Unit.

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So my talk to take covers the storage projects that are invalid in the body,

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what is water supply must plan. This is as a person said is irresponding to the

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request for additional information on the cost and benefit of storage projects from

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the

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surface water storage and ground water storage that allow for capturing access water in wet

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years to be used during the drought. The storage can compensate for the most important function

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is to compensate for supply variability to manage California's climate and the hydrologic

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I, in some cases.

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So, storage has lumpy a critical component of value water water supply system currently, value water storage programs consists of 10 surface water reservoirs, two local groundwater basins, and a contract with some traffic ground water back, for 350,000 acre, of storage.

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This country cover is set to expire in 2035.

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Those storage has played a vital role in

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the issue of water supply reliability for our community

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over many decades and into the future.

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This map shows value water's interconnected water system

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with storage being a big part of it.

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So value water system has proven reliable

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and flexible, but extended draws remain the biggest water supply challenge. The water supply

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must plan analysis, indicate if rely only on existing supply and infrastructure, value water

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will experience water shortage during the later years of extended draw mostly driven by

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change in demand, reduce supply and climate change.

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Those strategies are large and already take into account meeting

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broad water use reduction costs and long-term conservation costs.

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Therefore, valuable energy to invest in your project to ensure long-term water supply

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reliability for the country.

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Among investment options, storage is identified as a vital

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to water supply, reliability, both and the current and the future conditions.

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And diversify and the further expanding existing storage program is needed to help

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risk and the Medicaid drought impacts. A storage on coupled with drought resilience supply,

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in particular, the direct support barriers is effective in eliminating future water shortages.

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In addition, storage capacity, the put and take capacity of groundwater beds are also

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quickly important, because they determine how effectively water can be stored and accessed

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when it's mostly it.

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This table shows the three storage project options that are invalidated in the water supply

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mass plan, a particular expansion system

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raise and order of county groundwater banking.

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The table include their total storage capacity as well

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as full cost metrics, oh, expressed in $20, $25.

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The benefit and risk and challenge of each project,

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it's also invalidated and summarized in this table,

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are not going to go over of them, but over all, the evaluation shows

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e-project has merits and risk and challenges, and the projects are all

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at the planning stage continue to involve,

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therefore there are a lot of uncertainty with each of them.

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Based on project options, the water sub-mama's plan 2050

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developed three partition investment strategies,

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lower-cost local control, and diversify.

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Those strategies represent different approach to water supply reliability, but each comes with

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trade-offs and risk and the challenges. Also, each strategy requires a certain level of

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out-of-county ground water banking and ease of particular and the risk.

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Since many projects

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are still at the planning stage and will continue to involve, it's hard to predict at this

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time, which will ultimately be successful.

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Also, there's uncertainty with forecast future supply and the demand

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condition, which is a foundation of all those analysis, which

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bring further challenge in decision making.

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Therefore, adaptive management approach was developed to provide the

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board with ability and flexibility to make incremental

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investment decisions. With this approach, staff recommend lower cost strategy. Why continue to plan for

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particular and other projects? This is a way to balance flexibility and uncertainty. This will allow

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the standards of the several projects become clear and afford a board with options.

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Question, questions from committee members, all the presentations.

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Okay, go ahead.

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I have a super basic question.

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So the difference between the last two columns is what?

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Well, the one is a total prison-to-value of life cycle

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cause another is considered a unit cost.

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All right.

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Okay.

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No more questions. No questions.

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Okay.

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I have a question or first of all thank you staff for putting this on the agenda.

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I think it's generated by the question that I asked either at this committee or at the board.

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When I asked the question, I was thinking that the particular reservoir, if the board decides to go,

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it becomes value waters facility. So on that facility map, you're going to add another feature.

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So basically, it's an expansion of our existing infrastructure map.

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I mean, in a way, it can be thought about that way.

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Right? So that's where I'm coming from that you've in the benefits of a particular reservoir

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expansion. You've already included increases operation or flexibility. So that's I was thinking

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that in the next time that in Hachiko update to the board, if it's not related topic that this

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aspect can be explained in more detail to the full board. Because I could be, I could

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be wrong because I don't know the operation in detail of how water goes from there to there.

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But then I would think that there is a difference of creating storage as part of our existing facility map.

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And some storage capacity somewhere else, many miles from Santa Card County.

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And so that's basically where I'm coming from, I'm sure if there is an additional benefit because it's making the entire system more flexible from operation perspective.

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You guys probably already included in the analysis.

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but it's just that if I'm my thought process, it's not too far for reality. I think it's

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something that's worse, the effort to explain to the, to the football board. So that's, that's

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where I'm coming from. Does that, yeah, that is correct. So under the benefits for a particular

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So we do list that would be owned and operated by valley water and increases our operational

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flexibility.

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But even though it's not ours, the Sun Lewis dam is also on this map and easily connected.

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Yeah, that's definitely true.

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So we, I think we all have high hope for the system,

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damn race, internal, all of us, and then external people,

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all have high hope for that.

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But again, things need to be developed.

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I still have this good feeling about the comfort,

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the capability of the Highway 152, it's just, I just think it's something that's really,

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it's going to be really huge. But again, it's a great opportunity, everybody is hoping that

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will become a reality.

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So, yeah, so that's where I'm coming from. And I have another comment

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that in the next update to the full board, I was reminded how lately that

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A 60% design timeline that's the right timeline for the Board to make a decision. I forgot when

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the Board said that, but the person who reminded me is correct, I think the Board did say that,

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And then with this, while the supply mass supply, your adaptive management process, is that still a relevant decision point, if not, I think it's better that we

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explain to the board sooner rather than later. So that we don't continue carrying this 60%

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stage decision making point for the board.

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Maybe Ryan can add, but I would say the relevant decision point is to see which alternatives may work out,

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and if there are none.

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Yeah, so 100%. So that's what I'm saying.

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that it seems like the adaptive management is the way

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to reach that point instead of this fixed timeline

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at 60% of the house stage.

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So, but if that's, I think the board did

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discuss that and then had a direction on that timeline.

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So now things changed, it's better that we explain this current process and then I personally think that how the doctor management look at these things, it's a it's a right approach for the board. Yeah, but the board needs to get that information and then

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Um, discuss it in so that we don't continue carrying this thing. Oh, you said this. I told you this or something like that. Yeah. Okay.

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So that will be my comment on this. Any public comment. I'll say I see a hands raised.

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I think you chair. I have a physical cards and there are two hands raised online at when is Peter Van Dyke and caught here. Okay. Well, it's always Peter.

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Good afternoon, committee members, chair.

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You know, I'm just looking at the cost, the capital costs, and the total cost for the

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bechaco. Now, these are based on 20, 25 numbers, and it doesn't seem that they take

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in mitigation costs, perhaps for, you know, ecological mitigation and impacts.

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And the, the proposed dam is going to take how long to build. It's going to take

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at least a decade to even get through the process, I would think.

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And I don't believe that the costs, the increased costs due to inflation are factored

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into these numbers, I think, to give a better picture of what this is going to cost.

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Because this is all seems to be speculative.

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If you've got to add in all these other costs, which a lot of it's going to be litigation

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and mitigation and quite a few other things, I think that would be a more transparent outline

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for what this product is going to cost. Just one other comment on the adaptive management

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recommendations, you seem to, you propose, so desalination as a possibility. Now that's going

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to be very expensive and there's going to be a lot of waste involved as I, but you don't

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mentioned with anything about resisolating it and so I think that's another thing that needs

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to be considered is the recycling of wastewater too. I'm not sure which processes more

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expensive or which creates more waste but I know desalination is expensive so I'm not sure if

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treatment would be a better option. This would offset the need for imported water and even for storage

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to some extent. Yeah, I thank you for let me comment. Okay, thank you. Well, thank you for your first

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comment, or taking to consideration. For your second comment, I think maybe staff can provide

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the explanation. I think I'll get about this now. Box that says start the disability study. But then

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Right. Local while it's not our business. We support that. Yes. So in terms of portable reuse, we are already working on a project and desalination is a feasibility study, so that the board can have options and explore exactly that question. Right now, in the water supply master plan, because both are at a planning level, both portable reuse and desalination, they actually the same cost.

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They're expensive for different reasons and so this feasibility study will explore whether desolination is feasible in the South Bay.

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Also that the first bullet that's in both found says focus on low cost portfolio and you look at the low cost portfolio,

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the purified water is already in there.

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So that means we will focus on that in the near term.

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So, yeah, also I want to end a little bit.

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We have a assumption of recycled water in the best line.

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Also, that's in the, also the Dr. Paul Boris in the portfolio.

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Okay, thank you. Thank you. And Kacha,

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go ahead.

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Good afternoon, Chair Shua and committee members.

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Um, thank you, uh, Terushuifer for, um, bringing up the decision making point, um, it seems

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like there, it should be clear because I think some of the directors want, want to be able

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to have an opportunity to decide not to go forward with Pateco at some point, um, I mean that

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doesn't mean that you're definitely going to do the project that maybe you're definitely

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not going to do the project at some point before sooner than when there's a decision

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to me, you know, like, certify that ER. So I think some directors want the opportunity

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to stop you know developing and paying for Pacheco before that time so hopefully that you know

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somehow that can be made clear when they would have an opportunity to make that decision.

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I I just wanted to add that I've brought this up in the past but you know there's always

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the discussion of how important the put-and-take capabilities are and then the, you know,

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overall need for storage that Valley Water has. It's not clear yet, it hasn't been made clear yet

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and I've asked for that before, but it would be good to have a more in-depth discussion of that

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the water supply master plan, because otherwise it's just endless black box hole for more

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and more projects. And I think the public has a right to know what is really needed and what

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they really need to pay for. And I did have a couple of questions. One is about the the

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the surface water reservoirs that were listed but did not include San Luis Reservoir and I kind

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of assume that's because the water there has to be removed every year. There's no opportunity

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for carryover storage. But if there is then that should probably be included. And then the other

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question was about the present value lifecycle cost of 1.7 billion. I don't know what that

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includes, but in the CIP, the cost is 2.7, and I'm assuming that's partially inflation,

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And that's why it's different,

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but also with Peter's question about mitigation costs, what is included in the present value life cycle cost?

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Those are my two questions.

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Okay, thank you for your comment, and as for your two questions, I'll ask staff, if there's

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so, and sir, if not, how we can always come back to this.

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In terms of the first question, so the current son of Louis Reservoir would be part of

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Would be created at San Luis with the partnership project we're pursuing. And in terms of the cost for

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Pacheco, I referred to Ryan, we used what the Pacheco team provided to us as costs. And I believe it doesn't

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include a lot of the things mentioned.

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Yes, so the capital cost does include the construction

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and the design cost and then I think the other items that were mentioned were included as well.

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So the what's listed in here is as of this year the estimated project cause

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what's in the CIP is just every year there's a estimated inflation factor

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to the previous year. So that's why it's different, right? Okay, and also that I understand

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mitigation causes we have there's an estimated cause for mitigation and that is included

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in the total project cost. That is correct, and that number will get refined as we circulate

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the draft, the IR,

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and, you know, the, our mitigation requirements more nail down.

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So at this point, it's just, it's a preliminary estimated and just like construction

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calls, and then those numbers will be updated as we have no more information about what

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speed up. Okay. And as for the black box of pudding pool, so down the road that whenever

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these if there's appropriate genital item, maybe this topic can be a more detailed. Actually

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in today's agenda item, there's a little bit about the challenges on pudding pool.

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Yeah, but in the future, when the agenda item is on the board, on the agenda,

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let's relate it to this open by more information related to that.

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Is that okay?

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Well, yeah.

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You reminded me when you talked about the 152 highway complication or, you know, all of these are complicated.

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And I guess my question is, given the under this adaptive management framework and given that all of these, there's a lot of risk and there are big projects and something could go wrong.

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And we saw with Los Vicaros, a beloved project, not move forward.

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I'm wondering if staff or maybe board members who were a part of that or on the board could maybe comment on,

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like, what did we learn there in terms of what went wrong or what we could have done better potentially,

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that can be applied to these very complicated projects, especially the ones that were like,

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oh, I mean, Cisco seems like people are generally like, this seems good. Let's make sure

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this happens.

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I know there are some people who don't, don't feel that way, but I guess fundamentally

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my question is, LVE was the beloved project. It ultimately crated. Are there things that we learn

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from that that could be applied to this stuff so that we make sure that this, you know,

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the same things don't happen, the same mistakes don't happen. And I don't actually know what

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those are, but and like I said, maybe board members have a, I don't know, staff will do a staff

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have some better answer, but I'll just say this first before I ask a staff to one challenge is that

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these are not all a project. There are other people's projects. I mean, I can't have, I can say that

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I doubt this number, but I really don't know the detail of the project.

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And it's inappropriate for me to just second-guess other people's presentation, even though.

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So the huge difference is it's not our project, there's a project team that's managing

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those activities versus we have these people here that whatever question we have we just ask and then they get get a

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sensors and that's something to keep me money. Okay kids, sure. Yeah, I mean.

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And I would say there were no mistakes. It's just sometimes, you know, it doesn't work out. But maybe Cindy can add more.

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Yeah, I think one of the things that really came through with the loss of carous project, I agree with

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Kirsten 100% the partnerships are working with people in understanding their priorities and making sure priorities are aligned

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are really important and that was one of the things for a loss of carous that came through was that the priorities were not aligned

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among the participants, so contra cost to have certain priorities, other partners had other priorities and they couldn't come together.

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Yeah, so I think that was the key issue.

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And then, of course, director Shoé is common about how that was somebody else's project.

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relative to Pacheco, I mean, that's two totally different dynamics, right, and no very limited control over the project that is, you know, owned and operated by another entity for CISC, that is a project that's going to be owned and operated by the Bureau.

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There are partnership issues, so there's more, I'd say, there's more of an analogy to lose the carous.

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But in that project, there is more alignment on the priorities, which is to provide the water supply to the participants.

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I mean, the Bureau does have other priorities that we don't, that the participants do not necessarily support.

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And that's going to be a challenge moving forward for this project.

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So the governance and how we operate, we anticipate there could be some challenges, which is why we try to develop, we're working to develop a robust governance structure, moving forward, right. So that's that's one of the one of staff's priorities taking all that into account, trying to make sure the governance is going to work and the partnership is strong and we're working with the authority to

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So try and ensure that the bureau maintains a top of their mind that CISC is a priority aligned in many ways with hours.

250
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Yeah, good question.

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Because when I was the alternate, that's the first thing I asked.

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We're going to publish.

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So we all know the failures and how make sure it doesn't happen.

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And the all said, yeah, I think the biggest issue is that

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The partners change horses in the middle of the stream and I think the risk became a big issue

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but they should have been up front in the beginning.

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And so if there's any less to learn, we have to be aggressive and make sure that we address those immediately,

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which I believe we're taking on Pacheco.

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Probably the biggest issue we can control it, we're responsible, we're reliable.

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Right now I believe as Cartesian Cabalero has a couple bills pending.

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they'll dress 152, they're going to be growth and so you need water.

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And the thing of it is this, I didn't invent it, neither did the Romans.

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FDR did it back in 1939, so there was a reason then that same reason

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there, potential floods, emergency, and whether it be Vandak or whatever.

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But when you talk, you should be thinking about the next generation,

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because it was all past to us.

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And there's said in all these things, so we're not trying to do that.

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And so when I leave Mama they sure that my family has water and I didn't leave them sitting here

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Yeah, there's gonna be cost but what's the cost if you don't have water gonna be worse?

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So the less is I'm sure, you know, we'll learn but when you have your partners we're gonna be a front real quick

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Because there's that should have never happened and then

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I don't think it was a big issue. We had a couple chairs and

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Directors change and things happen there, but that wasn't a big issue. We just got to be when you meet

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When you buy the car make sure there's four tires.

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It's a good way to put it. Okay

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And so we don't there's no more public comment. Okay. Yeah, no more questions. Okay. Thank you. Thank you

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Thank you.

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Item 4.2, receive an informational update on the Pacheco Reservoir Expansion Project with

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the focus on partnerships and the role of the project in the Wadasupply Mass Supply.

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Yes, good afternoon, committee members, I'm Brian McCartner, Deputy Operating Officer

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of the Dam Safety and Capital Delivery Division.

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So, before I hand it over to Julie Ann, just want to say that I was...

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This is a good segue that the conversation we're just having into this next presentation because we do talk quite a bit about our partnership efforts that we've been undertaking for the last four years for the Pacheco Reservoir expansion project and some of the things we've learned.

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I think we've learned a lot more about other agencies in the state and it turns out they're just like us. A lot of them rely on important water. Everyone's concerned about climate change and everybody wants emergency storage and sort of a backup plan as we face towards the future.

285
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So yeah, just looking at it on to pay for it.

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Right. Yeah, this it's a, you know, it's an insurance policy, right? And investment and, you know,

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we've learned that a big investment upfront carries a lot of risk, right? So that's kind of one of the

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main, main messages we've heard in Julian will talk a little bit more about that. But yeah, we've been

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working with the the water supply team on this quite a bit and getting their input as well as with our

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our consultants that do this around the state for for other agencies and are really the experts in this field.

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And so I'll hand it over to Julianne.

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There is, through the chair, there is one more important issue.

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Even when we knew six, once things weren't working prior to the end, we wanted to continue

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relationship just in case we may have an opportunity to bring water for our residents.

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So we wanted to try to do damage and put everybody down, and we still ended up, but

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to get about half of our money back, but again, that relationship wasn't damaged and you never

297
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No, because I still believe there's going to be from Tracy, whatever, having the pump station, there's still potential water for the future, and but again, I really believe what we control something we'll be able to keep the costs were relevant.

298
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Okay, Julian, go ahead.

299
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Thanks, Julianne O'Brien, engineering manager, overseeing the Particle Project, good afternoon, everybody.

300
00:36:49,860 --> 00:37:09,020
Okay, so, as we've been kind of sharing in our recent updates, these are some of the past topics that we have presented on Patego both to the committee and then to the board at a later date and the most recent one being the informational project update that focused on the schedule changes.

301
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And then we will take this presentation to the full board likely in June,

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and then future topics still to come review the projects of environmental impacts and mitigation measures, as well as the review and discussion of cost benefit analysis.

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both of those will likely end up coming, probably later next calendar year just because there's additional

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information such as the 60% design and the resusculated draft EIR that needs to be completed before we can

305
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provide meaningful updates on those topics.

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And then as always additional topics that come from the committee or the board.

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We are going to talk about partnerships and a potential change in partnership approach here today,

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but it's going to be high level and we will plan on bringing that a more detailed discussion on that back and at a later date.

309
00:38:07,780 --> 00:38:10,360
Okay, so how did we get to partnerships?

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In 2021, there was a significant cost increase to the project, and during a presentation to the board, various partnership percentages were presented as a way of, you know, reducing the cost of the project to prep that's to the rate payers for value water that's still being able to move forward with the project.

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and 35% seemed to be the number that was the best, I guess, option moving forward.

312
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And then what we have done since then is we've had seven different agencies expressed interest

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in the project, six of those we have then met with and had in some cases a lot of meetings,

314
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some just a couple. And then two of them have actually sent letters of interest,

315
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a couple of the others are still in discussion phase. Thank you.

316
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Here's some other work that we have done as part of those discussions. We identified various sources

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Be call some three. But we've done a lot of work to identify how these different partnerships

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could work.

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And yeah, so we had economic evaluation as different scenarios, not getting

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into really the details on this is more just to show that there's been a lot of effort to go

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to these potential partnerships.

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And again, these are some additional areas where we might look to have partners or continue some

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of these we've already been talking to and we'll continue to some of these are kind of new

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partners that potential partners that have been identified to us.

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And feedback to date, like Cindy mentioned earlier, others mentioned earlier, partners

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it's a heart and that's what we've really learned throughout this process and there's definitely

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desire from these different partners to show up their shore up their water supply

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reliability, especially in dry and drought years and they a lot of them have different water types

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but some of the challenges relate to being able to afford the upfront capital costs.

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We have heard that value water and the Chaco in particular does provide a lot of potential

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benefits for these partners such as access to the CBP and state water project supplies

332
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and so well as the connection.

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The project would have to send the list reservoir.

334
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The advantage is exchange capacity relative to competing storage projects and we're looking

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to potentially provide them with flexible contract terms,

336
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such as maybe a shorter duration and rental versus

337
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high, you know, do more like a rental model,

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instead of having the owner model where they would have to pay

339
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that high upfront capital requirement.

340
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Okay, yeah, so talk about some of these already,

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but so some of the challenges that the partners have had

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is the relative costs compared to other

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virtual opportunities and that upfront to additional costs as well as taking on some of that risk.

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So we've been in conjunction with our consultants. We've identified a couple different conceptual

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partnership approaches. The first one is that full project partner, which is what we've been kind of

346
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moving towards initially where they would pay for a report and share the capital in O&M costs and then

347
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of a proportional dedicated storage space.

348
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And you know, I'm a project partner is similar,

349
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but maybe a shorter duration,

350
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so there would be a less upfront cost.

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Hybrids kind of something in between the full partner

352
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and a rental model.

353
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Rental would be just kind of annual fees for storage

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and return with a leave behind component

355
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that either value water could use

356
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or monetize through third-party sales and then a merchant model would be value-water acquiring

357
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surplus supply to store and then we would sell that to other water entities when they would

358
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have a need. And these are all pretty high-level conceptual at this point in time. We are asking

359
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our consultants to do a deeper dive and we'll come back with some posing columns of each model

360
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to then get direction at that point.

361
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So some of those impacts that are going to be studied

362
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are, you know, the costs in environmental releases

363
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and emergency storage are hope is that

364
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one of these models will still allow valley water

365
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to recruit some of our investment into the project

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and still with out having some of the same challenges

367
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is that a full partnership might have.

368
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Okay, then kind of link, going back to the take-os tie-to-war supply master plan.

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Some of this was already tested upon the jinx presentations, so I'm kind of just going to

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also over that.

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But our next, one thing I did want to point out is, our next board engagement point is actually

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going to be this summer when the board has the opportunity to finalize the EIL for the

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design level of geotechnical investigations. And we're still trying to figure out exactly

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when that's coming to the board, but it'll probably relate summer.

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And then again, just

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is a highlight some of the prep benefits primary water objective project objectives would be again.

377
00:45:00,000 --> 00:45:10,940
A huge objective is to increase the city will habitat and to create for the steelhead. And that is also a part of the grant requirements.

378
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And yeah, so emergency water supply, non emergency water supply, water quality. Again, this would allow us to move our water from San Luis earlier in the year.

379
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to talk about the creek already, and then additionally we're doing, we have the additional

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with the benefit of providing water to the refugee just during below normal water years.

381
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And I think that takes us to questions.

382
00:45:51,500 --> 00:45:54,840
Okay, thank you. Questions from community members?

383
00:45:59,500 --> 00:46:04,360
Well, if you have, I'll take a community member question first, and then we'll listen to people

384
00:46:04,360 --> 00:46:08,020
people's common, then we can discuss. If you have a question,

385
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I

386
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mean,

387
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I'm interested on the

388
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on the partnership piece in particular. I mean, there's the broader question of like,

389
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what are the, what are the dealbreakers for this? Under what circumstances would staff be saying?

390
00:46:34,290 --> 00:46:39,250
You know what? Actually, this looks like it's not a good idea. What, what are those specific things

391
00:46:40,450 --> 00:46:45,190
broadly, but specifically as it relates to partnerships, since that's what we're

392
00:46:45,670 --> 00:46:47,390
focused on for this presentation,

393
00:46:49,830 --> 00:46:51,010
I'll defer to right on that one.

394
00:46:52,230 --> 00:46:57,150
So, yeah, the biggest factor is costs, right? I mean, that's really what it comes down to.

395
00:46:57,950 --> 00:47:03,490
There's a large cost increase for some, you know, an unreads and ticker pick of things that

396
00:47:03,490 --> 00:47:09,970
can happen that have happened to other projects. That could be probably the biggest factor that

397
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would, you know, make it just not feasible anymore. And so that's how we do intend to do a cost

398
00:47:15,350 --> 00:47:17,750
benefit analysis is one of our future presentations.

399
00:47:18,750 --> 00:47:22,010
Hopefully following our 60% cost estimate update.

400
00:47:22,510 --> 00:47:24,870
So I think that's probably one of the biggest factors.

401
00:47:26,070 --> 00:47:30,810
I don't see us doing analysis to analyze our way out of needing

402
00:47:30,810 --> 00:47:35,050
Pacheco ever, but unless, you know, all these other projects go through and

403
00:47:35,050 --> 00:47:38,790
everything, you know, seems like we're going to meet, you know, our supply and demand

404
00:47:38,790 --> 00:47:41,670
and somehow there's a emergency storage somewhere that seems

405
00:47:41,670 --> 00:47:46,310
feasible, you know, that could be a decision point as well, that the board could decide to, you

406
00:47:46,310 --> 00:47:51,010
know, to not move on, but yeah, I think in fact, the costs, you know, if we were to lose the

407
00:47:51,010 --> 00:47:55,390
withy of funding, for example, that would be a major hit or a withs of funding with the state,

408
00:47:55,730 --> 00:47:59,790
those would be, you know, major implications to the cost of value water and rate pairs.

409
00:48:03,960 --> 00:48:11,120
Okay, you have a question, okay. Okay, and we have a public comment, questions,

410
00:48:11,120 --> 00:48:15,400
It's always, sorry, cannot see.

411
00:48:15,980 --> 00:48:17,680
That Chair, I can help with that.

412
00:48:17,760 --> 00:48:20,540
I have no physical cards and we do have three online comments.

413
00:48:20,900 --> 00:48:23,360
The first one is Mike Avina.

414
00:48:24,260 --> 00:48:25,580
Okay, well, stars, Mike.

415
00:48:25,940 --> 00:48:26,640
Please go ahead.

416
00:48:27,380 --> 00:48:27,580
Okay.

417
00:48:27,980 --> 00:48:28,900
Thank you.

418
00:48:28,900 --> 00:48:31,220
Mike, have any of you here with Sillary, Missouri?

419
00:48:31,660 --> 00:48:34,440
We represent the staff at Jacob Dam Coalition,

420
00:48:34,580 --> 00:48:37,840
and I would just like to reiterate our concerns that we feel

421
00:48:37,840 --> 00:48:41,040
that the project benefits are not outweigh

422
00:48:41,040 --> 00:48:43,880
by the Environmental Impact, which include inundating,

423
00:48:43,880 --> 00:48:46,760
where have attack types, such as Sikomora, Luvio,

424
00:48:46,880 --> 00:48:49,580
Udland, and significant impacts on a wildlife movement

425
00:48:49,580 --> 00:48:52,900
corridor, as well as impacts to a state park.

426
00:48:53,480 --> 00:48:56,600
And we encourage it all I wanted to continue to explore options,

427
00:48:56,760 --> 00:49:00,760
such as groundwater storage, or use of future capacity

428
00:49:00,760 --> 00:49:02,920
that will be created in San Luis Reservoir

429
00:49:02,920 --> 00:49:04,220
by the raising of Sisk Dam.

430
00:49:04,280 --> 00:49:05,240
Thank you.

431
00:49:05,540 --> 00:49:07,660
OK, thank you for your comment.

432
00:49:08,320 --> 00:49:15,960
next one. There are two more comments when the next one is Peter Van Dyke. Can Peter please go ahead.

433
00:49:16,560 --> 00:49:19,720
Yes, good afternoon. Again, thank you for letting me comment.

434
00:49:20,460 --> 00:49:23,760
You know, I am the president of the Lomer of Credit Resource Conservation District.

435
00:49:23,920 --> 00:49:26,520
I'm also on Agwater Advisory Committee.

436
00:49:26,640 --> 00:49:31,060
And I know partners getting partners on this project is a serious issue.

437
00:49:31,760 --> 00:49:36,540
Because I don't think the rate pairs can afford to finance this whole project on their own.

438
00:49:37,760 --> 00:49:45,480
if it ever goes through, so I'm not sure how that's going to be resolved if this project

439
00:49:45,480 --> 00:49:51,120
won't, if it just project goes through. The other thing is, I mentioned one of the benefits mentioned

440
00:49:51,120 --> 00:49:58,820
of Pacheco was the downstream environmental benefits, but that's not really explained as to what that is.

441
00:49:59,200 --> 00:49:59,920
I understand.

442
00:50:00,270 --> 00:50:21,810
So I don't understand how putting San Luis water into that system, which could introduce quite a few invasive species on a virgin creek, that the last time I looked at any water samples out of that creek, it was well below all health standards necessary for good water.

443
00:50:21,810 --> 00:50:26,450
So I don't know if it's a good idea to put untreated

444
00:50:27,430 --> 00:50:29,550
San Luis water into that creek.

445
00:50:30,310 --> 00:50:33,710
That San Luis reservoir water is only good for two things

446
00:50:33,710 --> 00:50:36,050
and that's perculation and treatment.

447
00:50:37,970 --> 00:50:39,190
I'll take your comments offline.

448
00:50:39,630 --> 00:50:40,170
Thank you.

449
00:50:41,430 --> 00:50:42,410
Hey, thank you.

450
00:50:44,230 --> 00:50:44,910
Padja,

451
00:50:51,210 --> 00:50:52,510
good afternoon again.

452
00:50:52,510 --> 00:50:57,290
I have some questions, several questions.

453
00:50:58,670 --> 00:51:06,470
One was talking about 100-year, it's using 100-year project life, and I was wondering if

454
00:51:06,470 --> 00:51:14,430
that's typical for dams, and if that's also the number of years are being used for Anderson,

455
00:51:14,430 --> 00:51:21,070
the life of Anderson and B.F. Sisk projects that are going forward if they're also assuming

456
00:51:21,070 --> 00:51:31,770
a hundred years. And I just another question is, and I'm hoping that the economic evaluation

457
00:51:31,770 --> 00:51:42,810
of potential partnerships in areas once that is completed that it will be presented to the board

458
00:51:42,810 --> 00:51:51,030
the committee, because I think for transparency, it would be the public would want to know

459
00:51:51,030 --> 00:52:03,860
that information also. And the last one question I have for now is about the rental or merchant

460
00:52:03,860 --> 00:52:11,200
models for partnership. I've never heard of that before, and so I was wondering if those have

461
00:52:11,200 --> 00:52:19,060
you'd used elsewhere and just because it seems if that's a whole brand new concept that could

462
00:52:19,060 --> 00:52:29,000
add risk and delay the project. Thank you. Okay, thank you. Thank you for your questions.

463
00:52:29,860 --> 00:52:38,880
Well first of all that up before I ask the committee for the discussion that this is this plan to

464
00:52:38,880 --> 00:52:43,040
go to the food board in June, right?

465
00:52:43,620 --> 00:52:44,900
Yes, for this presentation.

466
00:52:44,980 --> 00:52:46,380
What is for this presentation?

467
00:52:47,220 --> 00:52:54,640
Let's make sure that the questions we received today from these public members

468
00:52:54,640 --> 00:52:58,460
be listed and then answered.

469
00:52:58,460 --> 00:53:25,300
Some are easy answer, but some are probably taking pictures of right up to, too, as well, for I always feel like for a particular project that the more transparent we are the better for the project and that's why we design these categories for the board to have in-depth discussions.

470
00:53:25,300 --> 00:53:34,500
so was that additional comment for staff and then one of the reason we're hearing this

471
00:53:35,760 --> 00:53:44,320
today is to help staff that so that they can be more prepared and then make sure that's the

472
00:53:44,320 --> 00:53:50,460
package meet the full board needs better so anything that's care helps staff in those three

473
00:53:50,460 --> 00:53:54,240
the heart to high will be good. Yeah, so.

474
00:53:57,540 --> 00:53:58,220
Okay.

475
00:54:01,300 --> 00:54:09,920
Okay. Then that's for this item. And thank you, Julian.

476
00:54:12,860 --> 00:54:16,500
And move on to item 4.3.

477
00:54:21,600 --> 00:54:25,020
Receiving discussing formation regarding the status of potential

478
00:54:25,020 --> 00:54:30,000
one while they're banking project. Good afternoon again. I'd like to introduce

479
00:54:30,000 --> 00:54:36,460
Kyle how come to give this presentation. Good afternoon, Kyle. Good afternoon, committee.

480
00:54:37,360 --> 00:54:42,160
I'm Kyle, com, senior engineer with the important water unit. And I'll be providing an update

481
00:54:42,160 --> 00:54:47,480
today on potential groundwater banking projects. This will mostly be in verbal state, but I do

482
00:54:47,480 --> 00:54:53,240
have a quick map that I'll be pulling up on the screen here shortly. As you heard earlier today,

483
00:54:53,240 --> 00:54:55,460
Currently, so much topic is Valley Waters,

484
00:54:55,620 --> 00:54:57,740
only groundwater banking program and now

485
00:54:57,740 --> 00:54:59,580
agreement expires in 2035.

486
00:55:00,110 --> 00:55:24,430
As she also heard, current water supply master pen analysis suggests that we need to maintain access to groundwater banking to meet future supply needs and diversification of our banking programs, which reduce risk and potentially increase puts and takes allowing us to optimize our water supply contracts.

487
00:55:24,430 --> 00:55:31,370
And so in support of that effort, staff is continuing to evaluate groundwater banking projects across the state.

488
00:55:32,550 --> 00:55:42,130
As part of that evaluation, we are identifying risk and challenges with potential projects in particular with the implementation of the sustainability,

489
00:55:42,670 --> 00:55:45,470
as the sustainable groundwater management act or sigma.

490
00:55:46,430 --> 00:55:52,650
But also other familiar issues such as conveys and conveys capacity as well as water quality concerns.

491
00:55:53,910 --> 00:55:59,790
And so today I'll start with providing updates on a couple of projects shown on the map.

492
00:56:00,210 --> 00:56:06,350
These are previously presented to the water storage laboratory committee in October 2023.

493
00:56:07,330 --> 00:56:16,010
The first one is the Sacramento Regional Water Bank being developed by the Sacramento Regional Water Authority or RWA.

494
00:56:16,010 --> 00:56:24,010
It is, there are joint powers authority representing, you know, 2000 water agencies in the Sacramento

495
00:56:24,010 --> 00:56:30,910
region. You can see that on the map. They include agencies that value water previously

496
00:56:30,910 --> 00:56:37,190
partnered with to secure dry year supplies and so we were excited to potentially work with them

497
00:56:37,190 --> 00:56:44,130
on a banking arrangement. The goal for the Sacramento Regional Water Bank is to coordinate

498
00:56:44,130 --> 00:56:52,270
And expand conjunctive use practices of its member agencies within the local groundwater basins.

499
00:56:52,910 --> 00:57:03,970
And in 2023, there were also evaluating potentially inviting south of Delta partners for dispanking program.

500
00:57:03,970 --> 00:57:10,970
And so through the RWA value audit developed a draft pilot program, which would have seen

501
00:57:10,970 --> 00:57:18,710
us send CBP supplies to one of their agencies in 2023, and we engaged with approving

502
00:57:18,710 --> 00:57:24,550
agencies to better understand what that approval process would be like and how we can implement

503
00:57:24,550 --> 00:57:31,610
that pilot. And the feedback that we got was, well, moving on to south of Delta to north of Delta

504
00:57:31,610 --> 00:57:37,630
it's a new concept and there were some questions that were raised regarding accounting procedures

505
00:57:37,630 --> 00:57:43,470
and how to ensure that there's no harm done to other north-of-the-thelter contractors.

506
00:57:44,230 --> 00:57:50,210
And so I think that's kind of an example of potential challenges with getting new banks

507
00:57:50,210 --> 00:57:58,570
that approve through that approval process. And so while those questions are still being clarified

508
00:57:58,570 --> 00:58:05,230
and figured out the project team is focusing on moving forward with the project with their

509
00:58:05,230 --> 00:58:11,150
invasive partners while continuing to engage with reclamation to seek recognition as an

510
00:58:11,150 --> 00:58:19,730
acknowledged water bank for banking and covering CBP supplies. The second project that was presented

511
00:58:19,730 --> 00:58:27,170
previously was at Antelope Valley East Kern or Aevec and there are a high desert water bank

512
00:58:27,170 --> 00:58:33,870
phase two. AVAC had partnered with Metropolitan Water District of Southern California for

513
00:58:33,870 --> 00:58:40,410
face one of that project, and that project had targeted 280,000 acre feet of storage with

514
00:58:40,410 --> 00:58:49,390
putts and ticks annually of 70,000 acre feet. And they had suggested that a similar size

515
00:58:49,390 --> 00:58:55,790
or even larger scale project could be developed adjacent to that face one project. And so AVAC

516
00:58:56,650 --> 00:59:03,530
and value what it did have discussions and exchange preliminary terms, but Vivek ultimately

517
00:59:03,530 --> 00:59:10,410
put that project on hold in 2023. At the previous update, we're hoping that there would

518
00:59:10,410 --> 00:59:17,150
be new discussions last year, but Vivek's staff has continued to put that project on hold,

519
00:59:17,590 --> 00:59:23,810
cited the need to further evaluate that project and focusing on face one, completion of

520
01:00:00,000 --> 01:00:10,140
Existing facility that is also within AFAC boundary, and so that's why the coordination is needed, and it serves as another banking opportunity.

521
01:00:11,340 --> 01:00:16,320
The Willow Springs Water Bank has been conditionally awarded grant funding through Pop 1.

522
01:00:16,720 --> 01:00:29,900
The project team is aiming to make infrastructure upgrades and offer a banking program to partners who can deliver water to the bank through the California Accorduct, the East Branch of the California Accorduct.

523
01:00:29,900 --> 01:00:56,240
Because there is a prop one project, the project will need to provide equal system and emergency response public benefits and in November of last year they solicited interest from potential parties and value water did submit a non binding indication of interest to secure storage capabilities at that bank.

524
01:00:56,240 --> 01:01:04,960
Project staff, the Willow Springs Waterbank Project staff, is currently developing program parameters.

525
01:01:05,620 --> 01:01:12,900
Based on the received interest, they do say that it's going to be an iterative process.

526
01:01:14,060 --> 01:01:21,760
They're preparing project costs and rules for how partners will contribute to those public benefits.

527
01:01:22,400 --> 01:01:27,380
Product current timeline, we anticipate that we'll be getting some cost information in the

528
01:01:27,380 --> 01:01:34,540
middle of 2025 and we'll be providing updates to the committee as information becomes available.

529
01:01:35,960 --> 01:01:40,400
And so, while today's update is focused on those three projects shown on the map here today,

530
01:01:41,020 --> 01:01:45,510
you know, staff is continuing to engage and track other projects across the state as well,

531
01:01:46,280 --> 01:01:51,620
including Akotera and Irvine Ranch, which are a couple of projects that we had previously

532
01:01:52,580 --> 01:02:02,720
discuss with the committee here. Aquatera is a proposed bank in Fresno County and the project is moving forward with environmental analysis.

533
01:02:03,700 --> 01:02:14,920
Staff has identified some challenges with the project that still needs to be clarified before we can move forward in developing those conversations further.

534
01:02:14,920 --> 01:02:20,720
Staff has also previously mentioned a potential partnership with Irvine Ranch.

535
01:02:21,620 --> 01:02:27,240
So we entered into an agreement for a small program with them that would allow us to send

536
01:02:27,240 --> 01:02:35,120
water to that bank, food 2035 on a two to one basis at no upfront capital cost that will

537
01:02:35,120 --> 01:02:40,980
provide up to 10,000 acre feet of storage and we're currently working with partners, much

538
01:02:40,980 --> 01:02:48,000
positive current water counter, county agency and DWR and conveyance agreements, adjusting some

539
01:02:48,000 --> 01:02:50,840
comments and hopefully be able to implement that small project.

540
01:02:52,440 --> 01:02:57,460
And a staff continues to discuss potential partnerships, we're also following to implementation

541
01:02:57,460 --> 01:03:03,740
of Sigma, in particular within current counting, where some of my topic operates, who

542
01:03:03,740 --> 01:03:09,360
evaluate the updated GSPs that are expected in June, and follow the probationary hearing

543
01:03:09,360 --> 01:03:15,620
scheduled for September. And in particular, how those plans may affect

544
01:03:15,620 --> 01:03:21,180
recharge and recovery operations for the bank. And what that may mean for a

545
01:03:21,180 --> 01:03:27,340
potential extension of our semi-chronic program. And with that, that concludes my update

546
01:03:27,340 --> 01:03:36,400
and I've been to questions comments. Okay, thank you, Kyle. Questions from committee members first?

547
01:03:38,060 --> 01:03:43,460
I guess the one issue is that do we get the water when we want it, I know you're all going

548
01:03:43,460 --> 01:03:47,880
to work on it, then the quality water is probably the biggest issue with semi-tropics I

549
01:03:47,880 --> 01:03:53,060
hope we're not facing up there, but I applaud all of you for never stop trying to get us

550
01:03:53,060 --> 01:03:53,720
a source of water.

551
01:03:53,900 --> 01:03:54,600
That's what we got to do.

552
01:03:57,040 --> 01:03:57,280
Thanks.

553
01:04:03,210 --> 01:04:08,490
I don't think I have a question just kind of a comment and I'm still learning, I'm going to be

554
01:04:08,490 --> 01:04:16,430
for a long time. But given, so this all, this agenda here all fits together, right? So we looked

555
01:04:16,430 --> 01:04:21,070
at three of the projects, then we looked a bit at Chaco, and now we're looking a bit at groundwater.

556
01:04:23,850 --> 01:04:28,630
And so I'm interested in hearing from staff also the board, and again, as I'm learning,

557
01:04:29,130 --> 01:04:34,110
where we've been and how we think about this stuff, with the adapted management framework,

558
01:04:34,110 --> 01:04:50,110
We're putting lots of irons in the fire and we're paying to tend to those irons and part of my question about on the Chico about, you know, it's like you, how do we know has the board had had a discussion, have we set some problem?

559
01:04:51,350 --> 01:04:59,970
I guess I need to hear a little bit more. I'd like to learn a little bit more about when do we know that it's time to stop spending money on something on a particular

560
01:05:00,000 --> 01:05:05,860
So it says you're real cheap. And so I'm gravitating towards that. I like, I like cheap.

561
01:05:08,900 --> 01:05:19,540
But how, so how do we know that? Because I think that the memo said something like, we don't really have any projects that really that are in the works.

562
01:05:20,620 --> 01:05:28,640
But we're keeping the door open. There's a certain amount of work that we have to do to keep the door open so that if something happens, we can jump through it.

563
01:05:28,640 --> 01:05:53,640
So I'm kind of going around in circles, but I understand it's a hard question to answer, but like when do we know when to staff say like you know what time to pull this iron out of the fire we got to stop spending money on this one and and has the board kind of set those parameters or guidance or do we rely on staff to really tell us like it's time this isn't really going to go anywhere so let's stop spending money on it.

564
01:05:56,130 --> 01:06:00,250
Well, I would say that it's part of the Adaptive Management Program.

565
01:06:00,630 --> 01:06:03,970
We would we come back every year with the monitoring and assessment program.

566
01:06:04,690 --> 01:06:09,610
And so if the board agrees with staff recommendation, for example,

567
01:06:09,770 --> 01:06:12,610
on the water supply mass plan, and we focus on the lower cost,

568
01:06:12,730 --> 01:06:18,030
but we continue all these others because we're still in the planning stage on all of these or have nothing.

569
01:06:18,570 --> 01:06:25,290
And therefore we have to continue to keep more ions in the fire until we know which ones actually will work out.

570
01:06:25,290 --> 01:06:32,970
And then once we know that, which is likely in the next two or three years, that's when we would come with updates to the board.

571
01:06:33,750 --> 01:06:37,290
And we do update the water supply master plan every five years as well.

572
01:06:37,550 --> 01:06:46,750
So they might be new projects to look at, or they might be some, I mean, we have, you know, for example, Los Vercares was in the previous water supply master plan.

573
01:06:46,890 --> 01:06:50,290
We did analyze it for this one and then it dropped out.

574
01:06:50,290 --> 01:06:57,490
So these things happen and that's how we would handle it, we would do it in our annual update.

575
01:06:58,190 --> 01:07:05,130
We plan to actually have sort of each project in the annual update, like what's going on with

576
01:07:05,130 --> 01:07:11,650
it and what stages it add and to help the board make those decisions. And then each project

577
01:07:11,650 --> 01:07:16,750
as it comes forward, as you've been seeing with all of them, like you have this in Pacheco,

578
01:07:16,750 --> 01:07:22,770
always has a reference of the water supply master plan and how it relates. So I think that's how we would handle it.

579
01:07:26,370 --> 01:07:29,210
Yeah, much share. I think that's always good questions. But you know,

580
01:07:30,430 --> 01:07:35,510
says I've been here a while and so as night, soon as the drafts come, all the

581
01:07:35,510 --> 01:07:40,910
expectations and all the anxiety all change. Why don't you guys have more? Why don't you do this?

582
01:07:41,190 --> 01:07:49,270
So again, I applaud you all for keeping the irons warm. We're not like PG&E of the state

583
01:07:49,270 --> 01:07:54,950
burning down, but the droughts are going to come again. We prepared to hook up when we needed

584
01:07:54,950 --> 01:07:59,850
when there's emergency for two million people. You can remember the night when we get into politics,

585
01:07:59,850 --> 01:08:06,710
but as part of it, when the Anderson came, everybody knew about it, right at a drought. So where's

586
01:08:06,710 --> 01:08:13,550
our governor? We're the ones that had a face water for two million people and no one's gave us

587
01:08:13,550 --> 01:08:21,410
other than measure S. So I applaud you again so that three times. Keep those irres warm.

588
01:08:22,010 --> 01:08:27,410
Keep potential projects because when one fails we had something going on and we didn't have

589
01:08:27,410 --> 01:08:35,050
to invent the wheel. So being new that's why you would see it. But for me personally everybody keeps

590
01:08:35,050 --> 01:08:41,570
on cost, cost, cost. Well, we're about the tariffs of Merbat Costco. Water is essential because

591
01:08:41,570 --> 01:08:44,310
out water, those terrors won't go through.

592
01:08:46,520 --> 01:08:49,360
Water is vital. COVID-19, whatever. Water is

593
01:08:49,360 --> 01:08:55,260
essential of life. And we need to invest in it. We've got a continuing investment. And

594
01:08:55,260 --> 01:08:59,740
JPA, we're over the list of the kernels that just unfortunate means to let the people who

595
01:08:59,740 --> 01:09:04,300
didn't want to take any more risk. One more time that has set it in the beginning. So less

596
01:09:04,300 --> 01:09:09,560
has learned. But when you look at it, and I hate to say it, but a couple of million dollars

597
01:09:09,560 --> 01:09:17,380
and bad. Today's market. When you're talking about 4.2 billion and you're also talking about

598
01:09:17,380 --> 01:09:23,540
two million people in need of water. So keep doing what you're doing. So far up, you know, I'm

599
01:09:23,540 --> 01:09:29,620
very pleased. Like you, I want things that faster, but the politics is what it makes us have

600
01:09:29,620 --> 01:09:35,600
Anderson go on for 10 years. We don't do that 13 regulatory agencies. All the stuff we have to do.

601
01:09:35,600 --> 01:09:40,540
we do everybody's work but no one gives us the money and we rely on Santa Clara County voters.

602
01:09:41,420 --> 01:09:46,760
So I think they'd really do understand when I go places. I haven't that had any critics

603
01:09:46,760 --> 01:09:51,740
other than coming here on people up there saying a couple things. When I go anywhere this thing

604
01:09:51,740 --> 01:09:59,620
You're going to do a great job because when you turn that tap on, I've been here because water comes out of that tap.

605
01:10:00,000 --> 01:10:10,040
My comment is similar to my director said to us that sometimes it's frustrating, but you just need

606
01:10:10,040 --> 01:10:17,960
to keep, keep that, keep working at it. Actually, that that's our life in this organization,

607
01:10:18,640 --> 01:10:25,380
not while it's supply before protection and also that when it floods everybody's pointy finger at us,

608
01:10:25,400 --> 01:10:30,480
how come we didn't do this? In the five years after the flood nobody remembers that.

609
01:10:30,480 --> 01:10:42,480
the flood actually happened. So yeah, we just we have our missions clear and then we

610
01:10:42,480 --> 01:10:50,280
just keep working at those things. I do have a question, a small question that

611
01:10:50,280 --> 01:10:58,040
in the right up related to the Sacramento Regional Water Bank, it says the last

612
01:10:58,040 --> 01:11:06,180
paragraph, the sentences, staff learned of potential challenges, specifically relating to the feasibility

613
01:11:06,180 --> 01:11:13,500
of storing projects supplies, north of Delta, when we said projects supply, is that the

614
01:11:13,500 --> 01:11:22,520
CVP, is that CVP project or what is the project supply? You're correct. That was referencing

615
01:11:22,520 --> 01:11:23,220
CVPCB.

616
01:11:23,960 --> 01:11:24,640
CVPCB.

617
01:11:24,780 --> 01:11:26,340
It's a CVP project supply.

618
01:11:26,820 --> 01:11:27,320
OK, yeah.

619
01:11:28,000 --> 01:11:28,100
OK.

620
01:11:28,920 --> 01:11:29,820
Thank you.

621
01:11:30,720 --> 01:11:34,680
OK, are there any public comment on this item?

622
01:11:35,940 --> 01:11:36,540
Thank you, Chair.

623
01:11:36,580 --> 01:11:38,960
I have no cards on their NoHans raised online.

624
01:11:41,420 --> 01:11:52,500
So just if we minor to staff next time, if we have update on the ground wall

625
01:11:52,500 --> 01:12:01,780
other banking opportunity, if there's more information about taking pull information, that's

626
01:12:01,780 --> 01:12:07,620
include those so that everybody can understand what we say, what does that mean?

627
01:12:08,140 --> 01:12:12,200
I want to make sure the vice chair, because I truly feel what she feels.

628
01:12:12,880 --> 01:12:17,540
But you know, when we had the relationship, no matter what, with the counter cost, there is potential

629
01:12:17,540 --> 01:12:20,260
partners, because we left with good relationships.

630
01:12:21,000 --> 01:12:28,060
We're a very honorable as an organization and we didn't jump a gun, you know, because I remember the CEO telling me six months ago

631
01:12:28,060 --> 01:12:34,020
Yeah, take the same going good. You know, I said, well, that's easy to say what's the results? Well

632
01:12:34,020 --> 01:12:40,160
Our talk to our staff is it we're gonna hang in there. We're trying not to spend as much as we can

633
01:12:40,160 --> 01:12:46,060
But we're still still working because we still have and I really believe down a road. I really might may be gone

634
01:12:46,060 --> 01:12:48,000
But there'll be some link there

635
01:12:48,000 --> 01:12:54,060
for emergency waters and something that'll bring the security to our folks that we got elected by.

636
01:12:54,420 --> 01:13:00,220
So I think that a relationship is going to be good. And some of the people there, they thought

637
01:13:00,220 --> 01:13:06,220
our staff was great. We had good relationships, and they respect us. And I believe you were talking

638
01:13:06,220 --> 01:13:11,480
about the Alameda and everybody else, partnerships will come in the drought.

639
01:13:18,180 --> 01:13:19,260
Okay, so that's

640
01:13:21,320 --> 01:13:29,200
So, now move on to item 4.4, receive information on the water use projections, water demand

641
01:13:30,820 --> 01:13:38,300
elasticity, elasticity, and custom mobility study, and provide feedbacks to staff, Darren

642
01:13:39,160 --> 01:13:40,380
or, yes, I'm in.

643
01:13:40,920 --> 01:13:45,180
Good afternoon, committee members, Darren Taylor, chief financial officer, and yes, this

644
01:13:45,180 --> 01:13:51,820
is it's an update for the committee on the consultant study that's underway. It's been underway

645
01:13:51,820 --> 01:13:56,800
for a little while on those three topics, water use projections, water demand elasticity and

646
01:13:56,800 --> 01:14:02,380
customer affordability. And so we have our consultants with us today who have a brief PowerPoint

647
01:14:02,380 --> 01:14:09,760
for you and with that I'll turn it over to Kevin. Okay. Kevin, welcome to this committee. Thank you

648
01:14:09,760 --> 01:14:13,160
for your time to give us the presentation.

649
01:14:13,920 --> 01:14:14,900
Thank you for the welcome.

650
01:14:15,540 --> 01:14:18,440
Just confirming that you can hear me okay, on my end.

651
01:14:19,200 --> 01:14:20,760
They'd be a little louder, can you?

652
01:14:21,140 --> 01:14:23,400
Sure, I'll try and stay in a bit closer to the computer.

653
01:14:23,700 --> 01:14:24,920
This is good, this is great.

654
01:14:25,620 --> 01:14:27,180
Well, thank you again for the warm welcome.

655
01:14:27,720 --> 01:14:29,780
Again, Kevin Costa from our hotelists.

656
01:14:30,160 --> 01:14:32,220
I've got a couple colleagues from our hotelists on,

657
01:14:32,560 --> 01:14:34,800
as well as our partner in Hazen,

658
01:15:00,590 --> 01:15:26,450
Next slide, please. And if we had advanced one or two, we've got an animation here, one more please. So we, we would have shown this, this flow chart to you all the last time we met, showing our overall overarching project goals, to identify how valleys rates affect water demand in the county, as well as affordability of water service.

659
01:15:26,450 --> 01:15:31,310
And so we're keeping in mind that your rates are just one consideration.

660
01:15:31,530 --> 01:15:36,190
You have your own cost structure, your own cost incurred to provide wholesale service.

661
01:15:36,630 --> 01:15:41,190
The retailers similarly have their own cost structure in addition to your costs.

662
01:15:41,450 --> 01:15:43,630
Capital costs, cost of other sources.

663
01:15:44,050 --> 01:15:47,250
There's obviously translate into their retail and users bills.

664
01:15:47,410 --> 01:15:51,850
So we're trying to understand the feedback there between how your rates affect the retailers,

665
01:15:51,970 --> 01:15:54,570
how the retailers affect the end user's bills.

666
01:15:55,530 --> 01:15:59,110
So as was pointed out, yeah, we can advance one more.

667
01:15:59,770 --> 01:16:01,710
As was pointed out in the title slide,

668
01:16:01,810 --> 01:16:03,490
we've got three discrete tasks today.

669
01:16:03,570 --> 01:16:06,210
We're going to be talking about the results of the first task,

670
01:16:06,350 --> 01:16:10,230
which is a review of our water use and demand projections.

671
01:16:11,250 --> 01:16:14,670
So what we actually did and what we're going to step through briefly here today

672
01:16:14,670 --> 01:16:21,130
was a review of how the district currently forecast demands

673
01:16:21,130 --> 01:16:23,050
or purposes of rate settings.

674
01:16:23,290 --> 01:16:25,330
So we're talking about the demand forecast,

675
01:16:25,350 --> 01:16:26,770
and we're talking about annual rate setting,

676
01:16:26,910 --> 01:16:30,070
and we're not talking about a longer term supply forecast.

677
01:16:30,290 --> 01:16:32,150
So I just want to make that crystal clear.

678
01:16:32,370 --> 01:16:35,510
So we're talking about district-manage, water, demand,

679
01:16:36,690 --> 01:16:37,990
for purposes of setting rates.

680
01:16:38,790 --> 01:16:42,770
Then we looked at how we have expected changes

681
01:16:42,770 --> 01:16:44,510
in the service area, how those are utilized

682
01:16:44,510 --> 01:16:46,830
in the demand forecast and for purposes of rates,

683
01:16:47,450 --> 01:16:49,870
evaluating the performance of the existing approach,

684
01:16:49,870 --> 01:16:57,930
analyzing alternatives, looking at potential improvements, and then other considerations, so again we'll step through each one of those briefly here.

685
01:16:58,270 --> 01:16:58,950
Next slide please.

686
01:16:59,950 --> 01:17:08,070
So summarizing the existing forecasting method at a very high level, year one is our rate setting year, and this uses historical demands.

687
01:17:08,470 --> 01:17:14,650
So looking back in time, but weighted towards prior year actuals, most recent year of water demands,

688
01:17:14,650 --> 01:17:17,650
and leaning heavily on staff's institutional knowledge,

689
01:17:17,650 --> 01:17:22,310
extensive institutional knowledge, and discussions with individual retailers.

690
01:17:23,790 --> 01:17:26,230
Ineram years, those are years two and three.

691
01:17:26,550 --> 01:17:29,390
So now we're beyond the initial rate setting year, but in years two and three,

692
01:17:29,470 --> 01:17:33,350
we're looking similarly at the past, but also the most recent year's

693
01:17:33,350 --> 01:17:37,350
hydrology, was it dry, was it wet, was it a largely normal year,

694
01:17:37,590 --> 01:17:40,680
and then again, staff's institutional knowledge and discussions with

695
01:17:40,680 --> 01:17:45,560
retailers to kind of see what's the trajectory between year one and then the longer term,

696
01:17:45,660 --> 01:17:50,720
which we define as year four and beyond. That builds from the interim forecast,

697
01:17:51,360 --> 01:17:56,680
and then harmonizes with the incremental growth rates that are used elsewhere on the supply side.

698
01:17:56,960 --> 01:18:03,100
So when we think about incremental we're talking about incremental growth in new connections and

699
01:18:03,100 --> 01:18:04,880
water demands. Okay.

700
01:18:08,300 --> 01:18:12,260
So looking at historical water demands, we went back nearly 30 years.

701
01:18:12,260 --> 01:18:20,120
So these are district manage supplies or district water sales demands rather going back to 1996.

702
01:18:21,740 --> 01:18:27,700
And we've categorized them by three water types. We have North County groundwater, South County

703
01:18:27,700 --> 01:18:34,200
groundwater, and North County treated water or treated water and North County. And some observations

704
01:18:34,200 --> 01:18:40,300
are there on the left side of the slide. So the first is that we've seen a substantial decline or

705
01:18:40,300 --> 01:18:45,360
Excuse me, the first is that we've seen in South County a very stable groundwater use over time.

706
01:18:45,640 --> 01:18:54,600
So that's the green line you go back to 1996 all the way through 2023 the last year of the actual that we had when we started this analysis and you see very stable trends.

707
01:18:55,480 --> 01:19:02,400
You see a different story in North County both treated water and North County groundwater have declined over time.

708
01:19:02,540 --> 01:19:05,300
So not just one offsetting the other, but both have declined.

709
01:19:05,300 --> 01:19:14,940
And some by a significant margin, so North County groundwater, for example, is declined by roughly half over that it's a 28 year period nearly 30 year period.

710
01:19:16,140 --> 01:19:25,140
And so what we also see is that water usage is not trended upward, even if we've had changes in population growth and new housing starts, et cetera.

711
01:19:25,140 --> 01:19:39,060
The last observation here is that we see drought periods, resulting in lower demands or at least in multi-year drought shortages, resulting in lower demands, overall when we return to normal.

712
01:19:39,640 --> 01:19:46,740
So that is what we refer to as demand hardening. We see a decline and then we see a hardening of water sales or demands at a lower level.

713
01:19:48,480 --> 01:19:49,240
Next slide.

714
01:19:50,040 --> 01:19:59,040
So we benchmark what we've seen in your demand trends as well as staff forecasting approach with peer agencies.

715
01:20:00,000 --> 01:20:08,260
Orty, eSPEA, even though they're largely retailer, they're original peered in a large agency, eSPEA mud, and then

716
01:20:08,260 --> 01:20:13,360
much policy and water district of Southern California as well. And what we observed is that when we think

717
01:20:13,360 --> 01:20:19,380
about rate setting purposes or rate setting demand projections, the peers use the similar approach

718
01:20:19,380 --> 01:20:24,700
to what value-water staff is currently doing, looking at historical data, looking at forward-looking

719
01:20:24,700 --> 01:20:31,500
adjustments, considering annual hydrology, if drop conditions exist, and localized growth

720
01:20:31,500 --> 01:20:36,340
estimates. We also see similar trends in water sales over time, and if we go to the next

721
01:20:36,340 --> 01:20:39,940
side, we have a table that illustrates that.

722
01:20:41,260 --> 01:20:49,700
So looking back to 2015, which is our start year here, and then comparing, this is the annual

723
01:20:49,700 --> 01:20:56,000
change relative to prior year. So for example, in 2016, for Metropolitan Water District, we see a

724
01:20:56,000 --> 01:21:05,270
16% decline relative to 2015 and then in 2017, another 7% etc. So extrapolating that out to see

725
01:21:05,600 --> 01:21:12,420
what have been the changes of retirement and we see very significant downward pressure on water sales.

726
01:21:12,420 --> 01:21:15,740
Metropolitans down over 30%.

727
01:21:15,740 --> 01:21:18,540
Valley's declined by 16%.

728
01:21:18,540 --> 01:21:20,220
S.P.C. 7%.

729
01:21:20,220 --> 01:21:23,380
East Bay mud 5% and San Diego County 3%.

730
01:21:23,380 --> 01:21:24,840
You see a lot of variability.

731
01:21:25,120 --> 01:21:25,560
Year to year.

732
01:21:25,560 --> 01:21:28,800
As we go through drought cycles,

733
01:21:30,060 --> 01:21:32,160
wet, wet years, and normal conditions.

734
01:21:32,940 --> 01:21:35,460
But overall, all taken together over those last many years,

735
01:21:36,380 --> 01:21:39,560
a decline across all agencies and significant ones.

736
01:21:42,620 --> 01:21:46,900
So I mentioned that we did compare the existing approach against alternatives.

737
01:21:47,480 --> 01:21:51,980
And the reason we wanted to do that was to simply compare the results that we would see against the existing.

738
01:21:52,760 --> 01:21:59,380
Also to support staff in identifying in future great setting years, a range of estimates.

739
01:22:00,400 --> 01:22:04,040
So think of low medium and high demand ranges.

740
01:22:04,040 --> 01:22:14,100
And then also to provide a foundation if in the future, we wanted to entertain more complex modeling around demand forecasting.

741
01:22:16,060 --> 01:22:19,520
So we looked at three different methods, three alternatives.

742
01:22:21,040 --> 01:22:22,640
The first is a weather normalization.

743
01:22:23,120 --> 01:22:26,180
So we looked at what is the volume of water sales?

744
01:22:26,360 --> 01:22:28,740
So it would be expected in a typical water year.

745
01:22:28,740 --> 01:22:33,320
So normal hydrology, normal rainfall, normal annual temperature.

746
01:22:34,500 --> 01:22:39,640
The second was a regression to look at the relationship between multi-year moving average

747
01:22:39,640 --> 01:22:45,320
and again hydrology between wet years, drought conditions, et cetera.

748
01:22:46,300 --> 01:22:50,700
And then the third is the time series analysis, which is really a moving average and then

749
01:22:50,700 --> 01:22:54,280
categorizing each year based on a hydrology.

750
01:22:54,280 --> 01:22:57,380
was it abnormally low, abnormally high,

751
01:22:57,660 --> 01:23:00,240
was it a drought year, was it a wet year?

752
01:23:02,000 --> 01:23:03,000
So those are the three alternatives.

753
01:23:03,160 --> 01:23:05,280
And if we go to the next slide, we see the results.

754
01:23:06,680 --> 01:23:09,400
So again, looking at ranges, low, medium, and high.

755
01:23:09,680 --> 01:23:11,080
And the first is Valley's method.

756
01:23:11,160 --> 01:23:17,360
And so what we're looking at here is the range in 1000 acre feet

757
01:23:17,360 --> 01:23:20,160
and specifically for the current fiscal year, 2025.

758
01:23:20,340 --> 01:23:22,180
So this is what Staff would have shown in the fall.

759
01:23:22,180 --> 01:23:31,820
And so, what we see is a low-medium and high range of 200, excuse me, a low range of 200 and 8,000 acre feet up to a high range of 223,000 acre feet.

760
01:23:32,640 --> 01:23:41,060
Looking at the time series, it's significantly lower, the low to high range, where south of 190,000 and only up to 240,000 acre feet.

761
01:23:41,280 --> 01:23:48,040
That's largely because it's biased towards the recent past where we've had lower sales.

762
01:23:49,380 --> 01:23:55,880
Alternatively, the regression method, which considers a longer-term period, shows a range that's

763
01:23:55,880 --> 01:24:01,200
a bit more than what staff presented in the fall, 220, 1,000, acre-feet on the lower

764
01:24:01,200 --> 01:24:02,720
age, up to 234.

765
01:24:03,400 --> 01:24:06,300
What's interesting is the average of the three is pretty close.

766
01:24:06,400 --> 01:24:11,840
It approximates what staff's estimate was, 250,000 on the low end and 220,000 on

767
01:24:11,840 --> 01:24:12,280
high end.

768
01:24:12,280 --> 01:24:17,360
So it tells us that what staff is doing has done is reasonable.

769
01:24:21,890 --> 01:24:28,190
So some takeaways here, first is that the current approach is consistent with pure agencies that we looked at.

770
01:24:29,050 --> 01:24:35,070
The second is that when we looked at forecast to actual or think budget to actual water sales,

771
01:24:35,230 --> 01:24:39,330
they've been largely accurate and in fact we've seen a reduced variance in recent years.

772
01:24:39,470 --> 01:24:45,910
So staff is increasingly more accurate with their forecasting and that rate setting year compared to what

773
01:24:45,910 --> 01:24:53,990
actually transpires in that fiscal year. These statistical analyses that we conducted,

774
01:24:54,230 --> 01:24:59,970
the alternatives, they demonstrate that the current approach has a reasonable book and range.

775
01:25:01,400 --> 01:25:22,100
Next. So here's a handful of potential refinements. You know, some of it is small in understanding, referencing of our data sources, and just being explicit about our forecasting assumptions, aligning with longer term demand forecasting that we see in the remote management plan.

776
01:25:22,100 --> 01:25:37,740
And then incorporating any future interest page conservation, either by water type or by retailers as they all have their own requirements under the making conservation and California way of life legislation.

777
01:25:38,840 --> 01:25:47,140
And then lastly and again that we do have additional statistical methods that could supplement the existing approach if desire to explore that in the future.

778
01:25:49,510 --> 01:25:56,350
So some final other considerations would be to entertain retailer specific adjustments into

779
01:25:56,350 --> 01:25:56,850
man projection.

780
01:25:57,090 --> 01:26:01,890
So again, what we're looking at and what the rate model that staff uses is looking at

781
01:26:01,890 --> 01:26:06,230
those water types, again, North County groundwater, South County groundwater and treated

782
01:26:06,230 --> 01:26:06,670
water.

783
01:26:07,390 --> 01:26:14,590
So to supplement that, we could look at retailer specific demand projections or geographical

784
01:26:14,590 --> 01:26:18,430
on sectoral, think residential, commercial, agricultural,

785
01:26:18,730 --> 01:26:19,790
irrigation, et cetera.

786
01:26:21,410 --> 01:26:24,050
Another one would be to further analyze

787
01:26:24,590 --> 01:26:27,010
what to be expected in a drought rebound.

788
01:26:27,630 --> 01:26:30,670
So obviously over that last 30 years we've had

789
01:26:30,670 --> 01:26:33,430
multiple multi-year droughts.

790
01:26:33,550 --> 01:26:36,830
We've seen the demand hardening after a drought.

791
01:26:37,710 --> 01:26:40,810
But we could do some additional analysis on what might be

792
01:26:40,810 --> 01:26:44,290
expected to try and dial in those expectations on drought

793
01:26:44,290 --> 01:26:47,330
rebounds and this a handful of other considerations they're at the end.

794
01:26:50,920 --> 01:26:58,120
So that is that's a wrap on our first task. We we've drafted a report on that first

795
01:26:58,120 --> 01:27:02,100
task. It will be incorporated into the larger study report for all three tasks.

796
01:27:03,220 --> 01:27:10,760
The elasticity analysis and affordability work is ongoing and next we would look to

797
01:27:10,760 --> 01:27:18,800
come back to your committee with an update on task two and task three on the elasticity, effort and the affordability work.

798
01:27:22,310 --> 01:27:24,510
And without we'd be happy to entertain your questions.

799
01:27:25,410 --> 01:27:28,030
Okay, thank you very much for the presentation.

800
01:27:29,110 --> 01:27:31,030
Questions for committee members?

801
01:27:35,650 --> 01:27:35,730
Go.

802
01:27:36,210 --> 01:27:37,070
No, go ahead.

803
01:27:37,210 --> 01:27:37,710
Go ahead.

804
01:27:40,660 --> 01:27:41,620
First, thank you.

805
01:27:41,840 --> 01:27:42,980
This is super fascinating.

806
01:27:44,840 --> 01:27:45,700
I've lots of questions.

807
01:27:45,780 --> 01:27:48,380
I don't even know kind of where to begin.

808
01:27:49,480 --> 01:27:51,860
But I guess the high level takeaway is we're normal.

809
01:27:53,700 --> 01:27:58,780
The other partner or sibling agencies do stuff the same way that we do.

810
01:28:00,020 --> 01:28:04,480
And I guess one of the other questions we're trying to get it is, is normal good,

811
01:28:05,320 --> 01:28:07,380
because it might not be,

812
01:28:09,980 --> 01:28:12,520
you know, just because we're doing everything the same way that everybody else does.

813
01:28:12,600 --> 01:28:16,700
That is a good, I think that's a good thing, and we should look at like, is that a good thing?

814
01:28:16,700 --> 01:28:31,920
is normal good. I had a question on slide 9. So if I understand this correctly, so first one whether

815
01:28:33,680 --> 01:28:39,380
yeah, whether normalization is we're looking at the previous year mainly. Second one is we're

816
01:28:39,380 --> 01:28:44,840
looking at a four kind of a four-year average. I didn't understand what the third is. Can

817
01:28:44,840 --> 01:28:47,020
use that again, what that means.

818
01:28:47,480 --> 01:28:48,860
I could talk to that.

819
01:28:49,340 --> 01:28:50,420
So, time's here's analysis.

820
01:28:50,560 --> 01:28:53,980
The main objective of that is to identify the overall trend.

821
01:28:54,500 --> 01:28:59,780
So, the overall trend of water usage is going to be downwards from R.8, which was, I think,

822
01:28:59,860 --> 01:29:01,840
20 something years of data to today's.

823
01:29:02,460 --> 01:29:05,280
So, that's kind of goes to further why that was a low one.

824
01:29:05,500 --> 01:29:09,340
So, you're going to use a moving average, because what on average was a past 30 years

825
01:29:09,340 --> 01:29:14,820
of usage, that's kind of one of the ways to ex out any abnormality due to weather,

826
01:29:14,820 --> 01:29:20,780
do drought and so forth. And the next thing is compare how that year performed compared to that moving

827
01:29:20,780 --> 01:29:26,840
average to then take out the effects of weather to get kind of a weather normalized year as well.

828
01:29:27,280 --> 01:29:31,880
And then the trending downward update is going to affect the forecast once you identify the trend

829
01:29:31,880 --> 01:29:35,380
of it goes down x percent each year so that's the forecast.

830
01:29:36,980 --> 01:29:40,130
All right, I might have to go back and watch you say that a couple more time.

831
01:29:41,430 --> 01:29:51,370
What I would add to that is that all three of these methods are effectively different approaches to getting at the same normal.

832
01:29:52,150 --> 01:29:56,670
It should what should or would be expected in normal conditions.

833
01:29:57,830 --> 01:29:59,970
There are all different approaches to the yield difference.

834
01:30:02,240 --> 01:30:19,820
Now, we're going back to, I think it's the next slide, the regression yield something that's on a higher end, right, when we look at normal and this time series method, lower and again, that has to do with the variables that are included.

835
01:30:21,780 --> 01:30:28,920
the bias in the time series towards the the shorter term where we have in the last several years,

836
01:30:29,120 --> 01:30:33,840
lower demands than if we look at the longer term 10 years, 20 years, 30 years.

837
01:30:45,480 --> 01:30:51,120
I think that's it. Yeah, we'll go through a look and see it.

838
01:30:51,400 --> 01:30:51,540
Okay.

839
01:30:51,540 --> 01:30:58,480
I have a couple of questions on the slides.

840
01:31:00,300 --> 01:31:11,660
Well, first of all, I'm very happy to see the preliminary result that our methodology is

841
01:31:13,860 --> 01:31:17,600
or consistent with her first of all other agencies.

842
01:31:17,840 --> 01:31:22,400
It's exactly based on these other methodology on average.

843
01:31:23,440 --> 01:31:26,920
It's generated numbers that's pretty close to our methodology.

844
01:31:27,720 --> 01:31:30,900
So that's really good to know.

845
01:31:32,160 --> 01:31:38,460
They are a slight number 13 other considerations

846
01:31:38,460 --> 01:31:47,580
for refinement, potential refinements, can you explain a little better consideration of spatial

847
01:31:47,580 --> 01:31:57,320
and sectors, segmentation, and treated water contact provision and reserves policies?

848
01:31:59,890 --> 01:32:06,490
Sure, I'll lead. I'll probably go from the bottom up, and then I'll lean on our friend Luke

849
01:32:06,490 --> 01:32:08,330
from Hazen on the last one.

850
01:32:09,170 --> 01:32:12,850
So we talk about reserve policies to say that,

851
01:32:13,570 --> 01:32:18,590
reserve policies are generally a function of risk, right?

852
01:32:18,590 --> 01:32:20,750
I mean, cash flow to some degree, but also risk.

853
01:32:20,990 --> 01:32:24,130
And so in this context, we're thinking about the risk

854
01:32:24,130 --> 01:32:28,950
of being off in your demand forecast in one year or another

855
01:32:28,950 --> 01:32:30,530
or a deviation from normal.

856
01:32:30,770 --> 01:32:35,170
And so in a certain sense, with a more robust reserve policy,

857
01:32:35,170 --> 01:32:43,210
It's okay to be to have more variants in your projection than what might actually come to pass because.

858
01:32:43,370 --> 01:32:44,030
Oh, okay.

859
01:32:44,070 --> 01:32:44,750
Okay.

860
01:32:45,250 --> 01:32:46,630
That was the consideration.

861
01:32:47,170 --> 01:32:47,850
Okay.

862
01:32:49,110 --> 01:32:51,990
The second you mentioned was treated water contract provisions.

863
01:32:53,230 --> 01:32:56,510
You do you do have contracts with your treated water customers.

864
01:32:57,930 --> 01:33:06,570
And I know it lays out a schedule of deliveries and they're also subject, at least by the

865
01:33:06,570 --> 01:33:08,910
letter of the contract to take or pay provisions.

866
01:33:09,230 --> 01:33:17,750
And so if those take or pay provisions are enforced, then again, that reduces some of the

867
01:33:17,750 --> 01:33:26,670
experience from the forecast, but if they're not, then that's another consideration into making

868
01:33:26,670 --> 01:33:33,430
sure the the at least near term forecast is is dialed in so to speak. The last one is about

869
01:33:33,430 --> 01:33:40,850
spatial and sector segmentation. Luke, would you want to add to that one? Yeah, sure. Thanks. Thanks

870
01:33:40,850 --> 01:33:45,630
and appreciate, you know, committee having us here today.

871
01:33:46,890 --> 01:33:50,750
So from a spatial and sectoral segmentation standpoint,

872
01:33:51,050 --> 01:33:54,850
I mean, really, you know, what we're talking about is,

873
01:33:55,910 --> 01:33:59,850
you know, how water use and water use trends vary

874
01:34:00,570 --> 01:34:02,910
you know, throughout the county.

875
01:34:03,390 --> 01:34:07,030
For a spatial standpoint, you know, you might think about

876
01:34:07,030 --> 01:34:09,530
from like a retailer to read retailer basis.

877
01:35:00,880 --> 01:35:26,520
And similarly, from a sectoral standpoint, when we say sectoral, we're talking about, it's kind of like a synonymous with custom reduced classifications, so the way that single family households use this water, it's different from multi-family housing sector, which is different from commercial industrial and institutional use.

878
01:35:26,520 --> 01:35:45,800
So, you know, there may be an opportunity, you know, to incorporate, you know, and just try to, you know, better understand and represent the variability from both that, you know, spatial and, you know, different sectors of water use, you know, components.

879
01:35:48,060 --> 01:35:48,480
So,

880
01:35:50,180 --> 01:35:52,300
You know, hopefully that answers the question.

881
01:35:52,700 --> 01:35:58,660
Yeah, it does. Yeah, thank you very much. Yeah, thank you for that. Well, those answer.

882
01:36:00,020 --> 01:36:00,500
Okay.

883
01:36:01,260 --> 01:36:06,360
Uh, do we have, uh, if I should do you have a question? No.

884
01:36:06,660 --> 01:36:08,680
Okay. Are there any public comment?

885
01:36:09,960 --> 01:36:13,700
Uh, thank you chair. I have no cards but there are two public commenters online.

886
01:36:14,180 --> 01:36:14,560
Okay.

887
01:36:14,560 --> 01:36:25,840
Peter Van Dyke? Okay. Peter, go ahead. Thank you folks and just a couple comments.

888
01:36:26,580 --> 01:36:33,560
It's conservation efforts have been so successful and water use trends seem to be declining.

889
01:36:36,600 --> 01:36:43,800
How is this going to impact future revenues and how are we going to pay back some of these loans

890
01:36:44,600 --> 01:36:49,720
that are going into these projects if they're based, if they're revenues, future revenues, and sales are

891
01:36:50,520 --> 01:36:53,300
put up as the collateral. Will that entail

892
01:36:53,300 --> 01:37:00,620
drastic rate increases to the rate pairs or is there some other way to mitigate this or as has even been considered at all?

893
01:37:01,840 --> 01:37:02,960
Thank you

894
01:37:02,960 --> 01:37:10,520
Okay, thank you for your question. This is the question at Darren. Can you answer this? Okay. Yes, no

895
01:37:10,520 --> 01:37:16,520
Yeah, hi, Darren Taylor, Chief Financial Officer, and so we're just now taking a look at these results

896
01:37:16,520 --> 01:37:22,280
that show what's been happening over the past 30 years. And what we have baked into our current

897
01:37:22,280 --> 01:37:27,600
water use projection is fairly flat, a little bit of rebound after the most recent drought and

898
01:37:27,600 --> 01:37:34,200
fairly flat water use projections for the next couple of decades that translate to revenue for

899
01:37:34,200 --> 01:37:39,260
the water utility. And so yes, you're right that that's, you know, that revenue is what would pay

900
01:37:39,260 --> 01:37:41,100
for the debt and so on and so forth.

901
01:37:41,740 --> 01:37:43,440
And I also want to point out

902
01:37:43,440 --> 01:37:45,600
that we do have an annual process

903
01:37:45,600 --> 01:37:50,800
to set rates, the board must set water rates annually.

904
01:37:51,280 --> 01:37:53,080
We can't do it on a multi-year basis.

905
01:37:53,480 --> 01:37:54,720
And so we look at this annually.

906
01:37:55,040 --> 01:37:56,620
We update the model annually.

907
01:37:57,380 --> 01:38:00,700
And if water usage is playing out a little bit differently,

908
01:38:00,880 --> 01:38:03,160
than what we forecast, we update a case

909
01:38:03,160 --> 01:38:04,540
and point is this past year,

910
01:38:04,800 --> 01:38:08,840
where we reduce the water use projection by a good 15,000 acre

911
01:38:08,840 --> 01:38:13,020
feet per year as we look out into the future relative to what it was in the prior year.

912
01:38:13,420 --> 01:38:19,540
So that's how I'd answer that question is, is we update every year depending on how things are going.

913
01:38:22,820 --> 01:38:29,900
Okay, thank you. Thank you, Derek. And I'll just add that as I recall that the years ago that

914
01:38:30,940 --> 01:38:41,100
we used to estimate the projected water demand for the coming years like over 400,000.

915
01:38:41,100 --> 01:38:50,900
I mean, there's years like that, of course, we never saw that much water, but so it just tells us

916
01:38:50,900 --> 01:38:59,420
that we are based on what they're in just explained in my sense that we are getting better and better

917
01:38:59,420 --> 01:39:09,120
every year and then the actual usage and the projected demand to are getting closer and closer.

918
01:39:09,120 --> 01:39:17,320
Yeah, every year, so the, and that is the total revenue that we're using to, uh,

919
01:39:17,500 --> 01:39:23,120
for a fountain, all that. So we're not using imaginary numbers for, uh, anything

920
01:39:23,120 --> 01:39:30,340
spec, how we're using pretty close to actual numbers to do those things. Okay, uh,

921
01:39:31,000 --> 01:39:33,120
next one is Cacha, go ahead.

922
01:39:39,080 --> 01:39:42,820
Hey, hello again. Um, I had a few comments and a few

923
01:39:42,820 --> 01:39:50,980
questions for a staff the urban water management plan forecast tend to over estimate growth and

924
01:39:50,980 --> 01:39:58,060
future demand and are quickly out of date. So I think those forecasts should be used with,

925
01:39:58,600 --> 01:39:59,960
I know it's just for growth.

926
01:40:00,050 --> 01:40:12,810
You know, with caution, the 2020 urban water management plan forecasted that 2025 demand would be 330,000 acre feet.

927
01:40:13,450 --> 01:40:23,590
But now we're looking at, you know, at most, 223,000 in actual water usage. So it was just hugely off.

928
01:40:23,590 --> 01:40:30,510
which seems to indicate that using that projected growth will not provide accurate demand forecasting.

929
01:40:32,130 --> 01:40:38,150
And hopefully the 2025 Urban Water Management Plan will be different, but we won't know for several years.

930
01:40:38,430 --> 01:40:47,770
So I'm not sure how these reports can accommodate, you know, incorporate that.

931
01:40:49,890 --> 01:41:01,530
I would also suggest, or I'm not sure how droughts and demand hardening are being considered

932
01:41:01,530 --> 01:41:07,970
and so I'm hoping that there'll be more details on that in the report and then my questions

933
01:41:08,710 --> 01:41:14,290
are to some things I didn't understand in the presentation like what does it mean to review

934
01:41:14,290 --> 01:41:18,490
how expected changes in the service area are utilized.

935
01:41:20,610 --> 01:41:22,430
Pat is confusing I don't know what

936
01:41:22,430 --> 01:41:29,150
that means that was on slide three and then also what are the other considerations related

937
01:41:29,150 --> 01:41:38,290
to reserve policies that was on slide 13 and I also don't understand what that means. So thank you.

938
01:41:41,170 --> 01:42:02,170
Okay. Thank you for your question. There's quite a few questions. I don't know if there's any one that can be answered now, or if not, I will keep a record of these questions in there and make sure that next time the update answer that.

939
01:42:02,170 --> 01:42:05,170
I think initial, okay, go ahead.

940
01:42:05,450 --> 01:42:07,750
Just one small clarification.

941
01:42:08,270 --> 01:42:11,070
I think that this happens a lot,

942
01:42:11,370 --> 01:42:14,790
but the urban water management plan looks at countywide.

943
01:42:14,990 --> 01:42:17,030
And then when we do rate projections,

944
01:42:17,430 --> 01:42:18,830
that's just valley water supplies.

945
01:42:19,870 --> 01:42:22,110
So maybe that's where some of the disconnect

946
01:42:22,110 --> 01:42:24,490
is coming in and why it's so much higher.

947
01:42:25,290 --> 01:42:28,310
Because we are in the urban water management plan,

948
01:42:28,450 --> 01:42:30,030
including the SFPUC.

949
01:42:30,150 --> 01:42:30,570
Yeah.

950
01:42:30,570 --> 01:42:40,190
Yeah, okay, and also that's not the only thing we use to project future water, didn't that, right?

951
01:42:40,470 --> 01:42:45,870
We look at a lot of many things actually on these slides, it's listed under other consideration,

952
01:42:46,690 --> 01:42:56,290
I think. So, yeah, and then these other questions just, that's make sure that we keep track of them,

953
01:42:56,290 --> 01:43:02,490
And then at the next update, we'll make sure that we answer those questions, okay?

954
01:43:03,550 --> 01:43:04,310
Through the chair?

955
01:43:04,510 --> 01:43:04,890
Yes.

956
01:43:05,570 --> 01:43:11,290
One other sort of question that we have for you is, you are advice on whether or not we

957
01:43:11,290 --> 01:43:16,810
should take this update to the full board or whether or not we wait on an update to the full

958
01:43:16,810 --> 01:43:23,290
board when we advance further on parts 2 and 3 of the study, but appreciate your thoughts

959
01:43:23,290 --> 01:43:23,910
on that.

960
01:43:23,910 --> 01:43:30,670
Okay, I'll also what I think, and then I'll ask the committee members,

961
01:43:32,990 --> 01:43:33,850
if they agree.

962
01:43:34,850 --> 01:43:39,870
My personal thought is that I think it's easier for the board to digest the information

963
01:43:39,870 --> 01:43:44,070
if you separate into these three, three, three pieces.

964
01:43:46,090 --> 01:43:52,110
So to me, this is a good information for the board at this point.

965
01:43:52,970 --> 01:43:58,530
So, I don't want to come to you, members, have thought on.

966
01:43:59,190 --> 01:44:03,870
Well, I don't like the waste time, so I rather, when you give them something, give it all to them.

967
01:44:04,530 --> 01:44:08,510
I just thought that elasticity, analysis can be pretty complex.

968
01:44:09,250 --> 01:44:19,490
And then it's better to have a time dedicated to that.

969
01:44:19,490 --> 01:44:21,630
Yeah. So what do you think?

970
01:44:24,560 --> 01:44:30,960
I probably tend to agree with you. This is it's a lot to digest

971
01:44:30,960 --> 01:44:35,280
and it's nice to break it down into different chunks, which is also the purpose of the committee

972
01:44:35,280 --> 01:44:43,320
for us to be able to digest it in smaller chunks and then provide advice, but I think a board update

973
01:44:43,320 --> 01:44:44,740
would be good.

974
01:44:47,380 --> 01:44:51,100
I know a lot of these agenda items, it's it's broad, you know, provide feedback

975
01:44:51,100 --> 01:44:57,500
to staff and I would imagine it would be the same at the board, but are there any more specific

976
01:44:57,500 --> 01:44:59,980
questions you have of us today?

977
01:45:00,000 --> 01:45:09,340
First of all, just to give us an update and I know I've been one of those people that has been like, hey, what's going on with the study? Do we have any information we can share? So thank you. I appreciate that.

978
01:45:12,240 --> 01:45:28,110
And I guess so at this point, it's like, okay, it's moving. Here's what we know at this point, it looks like we when we're forecasting demand. We're on part with other agencies. We're doing it in a normal way.

979
01:45:28,110 --> 01:45:32,050
But is there any other questions you have for us at this point?

980
01:45:32,390 --> 01:45:40,390
And I would like to just say, I appreciate Joshua, you're asking about those other considerations.

981
01:45:40,710 --> 01:45:44,970
And I wanted to ask after there was clarification on this spatial piece.

982
01:45:45,670 --> 01:45:51,150
Is a different way of saying that that I guess putting it in my career jargon.

983
01:45:52,150 --> 01:45:54,430
It's a land use, that's a land use consideration.

984
01:45:54,430 --> 01:45:58,090
Is that a way of characterizing that particular consideration?

985
01:45:58,590 --> 01:45:59,530
So I'm getting to the weeds.

986
01:45:59,810 --> 01:46:01,930
One is do you have any other specific questions for us?

987
01:46:01,990 --> 01:46:03,390
And then on those considerations,

988
01:46:03,910 --> 01:46:08,390
is that an appropriate way of a different way

989
01:46:08,390 --> 01:46:10,550
that you could characterize that particular consideration

990
01:46:10,550 --> 01:46:12,670
is as a land use consideration?

991
01:46:14,270 --> 01:46:16,990
So as far as the first, I don't think we have any,

992
01:46:16,990 --> 01:46:19,130
I don't have any further questions for the committee

993
01:46:19,130 --> 01:46:22,850
and appreciate the feedback and the questions that you have

994
01:46:22,850 --> 01:46:34,710
And it sounds like that the consensus is to take it to the board and where we can answer some of these additional questions like that we heard from this ribbon and that kind of thing.

995
01:46:35,290 --> 01:46:44,730
And as far as the spatial and sectoral segmentation, I think that's a way, I mean the way I kind of view it is is, you know, we forecast at a very high level.

996
01:46:44,730 --> 01:46:56,610
And what they're saying is you could really break that down into lots of different segments, retailers or different things and build a forecast accordingly with all these little pieces.

997
01:46:57,750 --> 01:47:02,730
And I think that's a good advice and we're excited, frankly, about some of the new tools.

998
01:47:04,650 --> 01:47:08,950
The analytical tools that they're showing us moving averages and that kind of thing.

999
01:47:08,950 --> 01:47:15,030
stuff that we haven't done in the past that we could employ to make our projections even better.

1000
01:47:16,990 --> 01:47:27,430
So I'll just add, because I like the idea of this organization being even more involved in

1001
01:47:27,430 --> 01:47:38,930
that land use link to demand and exerting our influence. And I know a lot of, you know, we're not a land

1002
01:47:40,310 --> 01:48:08,690
But maybe there's a, that's a little ahead of this, but I just, I like the notion of, of, of drilling down on land use and this organization saying, oh, we can, we can, and should potentially help cities, the county, when they are putting their general plans in place, they're housing elements in place and help them understand, well, water usage looks like this, if you are growing in this particular way, then that means this.

1003
01:48:08,690 --> 01:48:14,930
And I don't know how much we need to learn how much we actually already do that, but I just

1004
01:48:14,930 --> 01:48:19,730
wanted to highlight, I like the notion of including land use more in what we do.

1005
01:48:26,480 --> 01:48:36,120
Okay, so I guess we'll have two comedy members thinks it's easier for the board to digest

1006
01:48:36,120 --> 01:48:43,140
the information at this point, if I share things we should give a completely report.

1007
01:48:43,140 --> 01:49:13,510
So I guess staff can decide, but personally, because this elasticity analysis, I can guess what it is, but I just think it's going to be a complex concept for the board and it seems like for this to have its own discussion with the board and it will be helpful to the board.

1008
01:49:14,890 --> 01:49:19,770
So that's where I am, so I don't know, you decide.

1009
01:49:22,550 --> 01:49:26,210
And I just, as Director Bylow is talking,

1010
01:49:26,530 --> 01:49:31,770
I just had a thought that as we're potentially

1011
01:49:31,770 --> 01:49:35,950
having these new tools or more breaking down

1012
01:49:35,950 --> 01:49:40,690
into different elements so that we can do a better job

1013
01:50:00,000 --> 01:50:24,880
To a better number of 219 that doesn't mean much. So there needs to be that in our consideration that we're not getting to too much work and not getting the effort that we're looking for.

1014
01:50:24,880 --> 01:50:35,740
Okay. We're thinking we did all of our discussion item. The next one is the review and

1015
01:50:35,740 --> 01:50:42,280
discuss the water supply and dynamic management community work plan and upcoming discussion items.

1016
01:50:42,700 --> 01:50:54,000
Our work plan is on page 77. The last page of the packet for the work plan. We

1017
01:50:54,880 --> 01:51:00,260
We didn't have, we didn't have for meeting in April, correct?

1018
01:51:01,380 --> 01:51:10,860
And so the items that's listed here, the three crosses, X, X is in April, are moved to today's meeting.

1019
01:51:11,140 --> 01:51:13,620
This is May, today's May 5th.

1020
01:51:14,080 --> 01:51:15,400
This is, this is the April meeting.

1021
01:51:15,400 --> 01:51:21,620
This is it, yeah, so I'm trying to, I'm trying to clarify what we're going to do in June.

1022
01:51:21,620 --> 01:51:26,220
So, we did all that on May 3rd,

1023
01:51:28,720 --> 01:51:35,480
and the regularly scheduled main meeting was actually on the holiday.

1024
01:51:36,060 --> 01:51:39,240
And so, we had a special meeting scheduled for June.

1025
01:51:39,240 --> 01:51:59,700
And then, so as it's planned right now, the drew meeting, we have the Jaldri Sons plan and no regret package, stone water floodmar, and sites reservoir and BF-sisk dam.

1026
01:52:00,200 --> 01:52:02,640
We actually will not have BF-sisk.

1027
01:52:02,640 --> 01:52:12,600
So we don't have a need to come back to the committee on that and a question asked to whether we will have the draft response plan, but we definitely will have all the other items.

1028
01:52:14,700 --> 01:52:19,820
Okay, so the job response plan is questionable.

1029
01:52:19,820 --> 01:52:35,230
Okay, and then stormwater resource plan, floodmar, and the sites reservoir, okay update.

1030
01:52:36,330 --> 01:52:47,190
And on my calendar, I actually have a special meeting for two seconds, and then I regularly schedule meeting on June 23, both are on my calendar.

1031
01:52:47,190 --> 01:52:56,730
So my suggestion is that that's just going with our record schedule meeting and then the June 2nd special meeting can be canceled.

1032
01:52:57,590 --> 01:53:03,270
Give all of your more days to put this together.

1033
01:53:03,810 --> 01:53:06,650
We agree because June 2nd is technically the main meeting.

1034
01:53:06,650 --> 01:53:14,930
So yeah, I know, I don't, it took me a while to figure it out.

1035
01:53:15,110 --> 01:53:26,950
So, let's take the two seconds, especially the alpha-order calendar, we'll stay with the regular meeting that's June 23rd with these items.

1036
01:53:27,890 --> 01:53:29,610
That's just talked about.

1037
01:53:29,730 --> 01:53:30,770
So that sounds right.

1038
01:53:31,410 --> 01:53:31,490
Okay.

1039
01:53:31,490 --> 01:53:35,350
It doesn't think each of it, the calendar kind of shifted because of holidays.

1040
01:53:35,530 --> 01:53:39,050
Yeah, the rotating holidays. The main thing became April meeting.

1041
01:53:39,750 --> 01:53:40,390
Yeah, anyway.

1042
01:53:41,850 --> 01:53:49,310
Okay, and the next item is Clark Review and Clarification of Comedy Request.

1043
01:53:50,250 --> 01:53:54,910
Thank you, Chair. I have no comments at this time, and we'll reach out to staff if I have.