COMMITTEE AGENDA MEMORANDUM
Water Supply and Demand Management Committee
Government Code § 84308 Applies: Yes ☐ No ☒
(If “YES” Complete Attachment A - Gov. Code § 84308)
SUBJECT: title
Receive Update and Discuss the Water Conservation Program Savings Number for Fiscal Year 2025.
End
RECOMMENDATION: Recommendation
Receive update and discuss the water conservation program savings number for Fiscal Year 2025.
Body
SUMMARY:
Since 1992, Valley Water’s robust Water Conservation Program (Program) has supported the Board of Directors (Board’s) long-term water conservation savings goals established through the Water Supply Master Plans (WSMPs) 2040 and 2050, which include annual monitoring. The Program also supports Board Resolution 23-52 to Make Water Conservation a Way of Life in Santa Clara County. The nearest milestone is to conserve 99,000 acre-feet per year (AFY) by 2030 (compared to the 1992 baseline).
Valley Water staff tracks progress towards the long-term conservation goals using a custom, Excel-based Water Conservation Savings Model (Savings Model). Every year, staff inputs annual Program participation totals from the prior fiscal year into the Savings Model to track progress toward the long-term conservation goals. To leverage the latest data available, staff periodically update model assumptions such as program water savings, savings accrual rates, and population and housing data, which can affect the prior year’s reported savings. Details on the Savings Model’s inputs and program assumptions are in Attachment 2. This memo provides an update on fiscal year (FY) 2025 savings and reviews program trends.
Information about current conservation programs is detailed in the attached flyer and can be found at www.watersavings.org <http://www.watersavings.org> (Attachment 3).
Savings Update
In FY 2025, long-term water conservation reached 87,392 AFY (from a 1992 baseline), a net increase of 1,225 acre-feet. This continues a 6-year upward trend since FY 2020 but is below the 2,400 AFY metric established by the 2021 Water Conservation Strategic Plan (Strategic Plan; Attachment 4). Through this period, Valley Water has shifted from drought-driven gains to more stable, program-driven growth with annual increases ranging between 1,225 and 3,606 AFY (Table 1, Attachment 6). Year-over-year growth declined from 4.4% (FY 2023-FY 2024) to only 1.4% (FY 2024-FY 2025; Table 1, Attachment 6; Figure 1).
Even though conservation savings are slowing, the average increase over the last 6 years remains greater than the 2,400 AFY threshold. Staff estimates that the 2030 goal will be met if the Program achieves an average net-increase of 2,322 AFY between FY2026 through FY 2030.
Figure 1: Percent change in savings compared to the prior fiscal year between 2013 and 2025, showing drought periods.
Post-drought participation declines are typical and expected, yet Landscape Rebate Program (LRP) - Turf Conversion remains above pre-drought levels (Table 2, Attachment 6), while LRP - Irrigation Equipment has returned to approximately pre-drought participation rates. Meanwhile, Advanced Metering Infrastructure (AMI) and Large Landscape Program (LLP) irrigation budgets continue to expand. Overall savings growth is slowing as earlier program gains reach the end of their useful life, which is contributing to this declining rate. Sustained participation is needed across all programs to maintain growth.
Key factors influencing recent savings trends:
• Expanded outreach tools: Conservation doubled its marketing budget compared to pre-drought levels ($500,000 in FY 2026). Additionally, staff can leverage messaging platforms for LLP site-specific water budgets (CII properties), Water Use Reports, and AMI;
• Aging program impacts: expiration of savings from cost-effective irrigation equipment upgrades (particularly installations during the 2013-2016 drought), and the long-term decline in Water Efficient Technology Rebate (WET) Program participation (Table 3, Attachment 6; Attachment 1);
• Sustained incentives: Particularly for the CII sector, LRP - Turf Conversion participation is supported by maintaining the $2/sq. ft. rebate;
• Regulatory awareness: Upcoming non-functional turf (NFT) irrigation restrictions (2027-2031); and
• Population: modest growth since 2023 contributed to passive savings.
Program Trends
The strongest performing water conservation programs continue to be the LLP, Water Use Reports and AMI, and LRP - Turf Conversion (Table 3, Attachment 6). Most of these programs expand targeted-messaging and engagement opportunities, particularly to the CII sector, along with retailer coordination.
Outdoor Conservation Trends
Half of all program savings are from outdoor conservation programs, led by LLP’s irrigation budgets and LRP - Turf Conversion. Though LRP - Irrigation Equipment has a relatively low useful life, they yield significant savings, indicating the importance of continued focus on these off-the-shelf water-saving devices. Turf conversion projects increased from FY 2020 to FY 2023 and, despite recent declines, FY 2025 levels remain over 3-times higher than in FY 2020, the first year of the last drought (Table 2, Attachment 6).
Turf conversion projects by CII and MF are increasing (Table 2, Attachment 6):
• Before FY 2023, CII and MF sites accounted for an average of 25% of all turf converted and 5% of rebate applications.
• Between FY 2023 and FY 2025, CII and MF jumped to an average of 47% of all turf converted and about 11% of rebated applications.
CII and MF projects require comparable staff effort as single-family projects, yet yield significantly larger water savings per site, reinforcing their importance for meeting long-term policy goals.
AMI Progress
Valley Water has consistently secured cost-sharing agreements to expand AMI, with the newest partner, Mountain View, in late FY 2025. This program includes:
• Requiring leak alerts and best practices from participating retailers (Attachment 5).
• By FY 2030, Valley Water staff anticipates significant coverage of AMI (Table 4, Attachment 6), 10 years ahead of schedule.
Furthermore, Valley Water partnered with the City of Santa Clara to retrofit production wells with AMI-capable meters for remote monitoring. Valley Water has begun installing AMI on 37 surface-water meters to support operations, with plans to expand to other retailers and private well owners. Though Conservation staff does not attribute a savings number to this newer AMI approach, it provides an opportunity for future evaluation and exploration in measuring water savings.
Additional Updates
WET and Submeter Rebate Programs
WET, one of Valley Water’s oldest conservation programs (since FY 1997), has seen declining participation since its FY 2007 peak. The rebate has remained at $4/CCF since around FY 1999 (briefly increasing to $8/CCF during the 2013-16 drought). Higher cost-share rates in limited areas and a 2020 cap increase to $100,000 have not reversed this trend, indicating that the rate may be a key motivator. However, of six water agencies in the western United States with a similar performance-based rebate, Valley Water’s rebate rate is among the highest.
Because projects are flexible (and at times proprietary), marketing can be challenging. Staff have inspired potential applicants through sharing EPA WaterSense CII Case Studies and a story map of past WET projects. (In February 2026, staff awarded a rebate of about $16,000 to Gordon Biersch Brewing Company for upgrading its cooling equipment, resulting in an estimated annual water savings of about 3 million gallons).
Likewise, the submeter rebate has remained constant since about 2001 at $150 per submeter. Submeters are estimated to save 10-30% compared to relying on a master meter. With the role of Accessory Dwelling Units to help meet the region’s housing goals, pushing submeters to these developments provides a timely opportunity, which would require sustained collaboration with municipalities as well as the County.
Valley Water is actively engaged with the California Water Efficiency Partnership (CalWEP) CII task force to improve CII program participation statewide. Staff’s consistent statewide engagement with outside organizations led to our early contributions via funding and sharing past outreach efforts to CalWEP’s CII Outreach Playbook, to be published later in 2026. Finally, staff is undertaking a savings analysis of the Commercial Indoor Water Survey Pilot that ran between FY 2024 and FY 2025 to evaluate whether to allocate resources to this free CII service. Staff is incorporating findings from the CII Outreach Playbook and NFT outreach collateral noted below into an ongoing effort to develop a CII campaign that supports LRP and WET participation.
Non-Functional Turf
Assembly Bill (AB) 1572 prohibits irrigating non-functional turf (or decorative lawn) on CII and Homeowners Association (HOA) common areas with phased implementation between January 2027 and 2031. Awareness of this regulation is likely influencing the upward CII participation the LRP has experienced in recent years. Expanding upon this awareness to incentivize transforming these turf areas into low-water landscapes is paramount in the next few years. To support this effort, Valley Water helped fund www.nonfunctionalturfca.org <http://www.nonfunctionalturfca.org> with CalWEP and agencies throughout California. That online resource includes case studies; resources for landscapers, CII, and HOAs; and over 40 messaging templates that Valley Water can customize and co-brand with local water retailers as part of a non-functional turf toolkit.
Additionally, as part of the Making Conservation a California Way of Life regulatory framework (AB 1668/Senate Bill [SB] 606; MCCWL), the Department of Water Resources mapped and measured all irrigated landscaped areas served by urban water suppliers (11 of our 13 major water retailers). Valley Water has become a Founding Partner along with Metropolitan Water District of Southern California and Municipal Water District of Orange County to support CalWEP’s development of a wholesaler view of the data. Once complete, staff will be able to target programs to areas with the most turf in the county.
Updating the Strategic Plan and Savings Model
The Strategic Plan was developed before key policy and regulatory developments, including the 2050 long-term savings goal, Resolution 23-52 to Make Water Conservation a Way of Life in Santa Clara County, AB 1572, and MCCWL. In February 2026, Valley Water released a Request for Proposal (RFP) for a Conservation Services and Assessment Program to update these decision-support tools, among other program improvements. Staff expects this project to incorporate passive savings from AB 1572 as well as the Model Water Efficient New Development Ordinance (MWENDO), at a minimum, which will further increase our savings progress.
MWENDO
State laws (AB 130/SB 131 CEQA Overhaul Package) now prohibit cities from adopting new or amended residential reach codes. Staff are exploring advocacy opportunities for cities to consider MWENDO measures for commercial properties and are engaging business associations and local Chambers of Commerce to support adoption. In November 2025, the Board recognized the City of Santa Clara as the first to officially adopt MWENDO measures.
Further, several cities in Santa Clara County already have measures aligned with MWENDO, providing a strong foundation for water efficiency. Combined with existing programs and implementation time, Valley Water remains well-positioned to achieve its long-term water conservation savings goals despite temporary limits on full MWENDO adoption.
Select Partnerships
Valley Water sponsored a first-of-its-kind training in Northern California for water retailers to strengthen CII-conservation outcomes. This training combined classroom and hands-on field audits to teach conservation staff of water retailers how to engage effectively with CII customers, including how to identify the most water-saving opportunities, improve leak detection techniques, and evaluate Return on Investment (ROI) potential to increase buy-in for successful conservation outcomes.
Valley Water collaborated with agencies throughout the State to develop and host the first-of-its-kind leak-detection training for plumbing professionals, with 21 local plumbers attending Valley Water’s training. The International Association of Plumbers and Mechanical Officials hosted the training and maintains the plumbers’ list at <https://iapmo.org/training-education/calwep-contractors-directory>. As of this writing, the City of Palo Alto is actively sending this resource through its AMI system to customers experiencing leaks and high usage.
Conclusion and Next Steps
Valley Water’s strategic conservation efforts are yielding consistent yet diminishing results, as is expected following a drought. Long-term water savings increased by 1,225 acre-feet to 87,392 AFY (from a 1992 baseline) in FY 2025. Even though some programs have maintained impressive participation levels (turf conversion) and growth (irrigation budgets, AMI, and partnerships), declining participation in irrigation equipment and WET are reducing progress towards the 2030 goals.
The Strategic Plan identified the need for additional resources to ensure the program can meet the Board's 2030 goal. The Conservation Services and Assessment Program RFP will provide staff with enhanced tools and resources, including updates to the Savings Model, and advance a formal communications plan. Valley Water will also strengthen partnerships with CalWEP, the Bay Area Water Supply and Conservation Agency, and water retailers to expand program participation. In addition, the water conservation program will maintain increased funding levels to support expanded advertising and strategic outreach efforts, particularly through a new campaign focused on CII customers. Lastly, staff will continue exploring and piloting new programs and resources to support sustainable water use regionally and locally.
ENVIRONMENTAL JUSTICE IMPACT:
Environmental justice impacts on local communities are expected/likely to result from implementing the water conservation program toward meeting the long-term water conservation 2030, 2040, and 2050 goals.
Water conservation offers a range of environmental justice benefits by promoting equitable access to clean water, reducing pollution, protecting ecosystems, mitigating climate change, saving costs for vulnerable communities, enhancing drought resilience, and empowering residents with knowledge and skills for sustainable water use. Valley Water provides such water conservation information in multiple languages and via various outreach techniques to reach all members of our community. Valley Water acknowledges that during drought, disadvantaged communities may be disproportionately impacted. To address these impacts, Valley Water promotes access to equitable and affordable water supplies (Water Supply Goal 2.6).
ATTACHMENTS:
Attachment 1: PowerPoint
Attachment 2: March 2023 WSDM Comte. File Num. 23-0248
Attachment 3: Water Conservation Program Flyer
Attachment 4: Link to 2021 Water Conserv. Strategic Plan
Attachment 5: AMI Program Guidelines
Attachment 6: Tables Referenced
UNCLASSIFIED MANAGER:
Manager
Kirsten Struve, 408-630-3138