BOARD AGENDA MEMORANDUM
Government Code § 84308 Applies: Yes ☐ No ☒
(If “YES” Complete Attachment A - Gov. Code § 84308)
SUBJECT: Title
Consider the October 7, 2025, Board Policy and Monitoring Committee Recommendation to Adopt a Proposed Resolution Setting Forth a Revised, Increased Fee Schedule for Administering Santa Clara Valley Water District’s Well Permitting and Inspections Program.
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RECOMMENDATION: Recommendation
Consider recommendations resulting from the October 7, 2025, Board Policy and Monitoring Committee meeting to:
A. Adopt the Resolution ADOPTING A REVISED FEE SCHEDULE FOR ADMINISTERING SANTA CLARA VALLEY WATER DISTRICT’S WELL PERMITTING AND INSPECTIONS PROGRAM (SUPERSEDING RESOLUTION NO. 17-52).
B. Provide feedback and recommendations to staff as necessary.
Body
SUMMARY:
On July 25, 2017, the Board adopted Resolution 17-52 (Attachment 1) updating a prior well permit fee schedule based on staff recommendation. This fee schedule remains in effect today and, due to inflation, does not recoup Santa Clara Valley Water District’s (Valley Water) cost of administering its well permitting and inspection program.
Staff has evaluated well permitting and inspection costs to ensure that Valley Water’s well permit fees are based on the reasonable costs for completing our permitting and inspection work. Based on the evaluation, staff is recommending an update of the fee schedule that increases well permitting and inspection fees.
Nearly half of Santa Clara County’s annual water supply is delivered by groundwater pumping. One of the ways that Valley Water aggressively protects this important natural resource is by requiring permits to drill wells and by conducting inspections of the installation and destruction of permitted wells. The primary goal of these activities is to ensure that well construction and destruction work meets the requirements of Valley Water’s Standards for the Construction and Destruction of Wells and Other Deep Excavations in Santa Clara County and California Department of Water Resources’ California Well Standards - Bulletin 74-90 so that wells do not inadvertently become conduits for groundwater contamination. Approximately 1,000 well permits are issued annually, and most of these (over 90 percent) are issued for wells installed for monitoring and other non-water supply purposes.
Valley Water Well Ordinance No. 90-1, Section 5.1, requires the issuance of permits for the construction, modification, or destruction of wells in Santa Clara County. Section 6.5 of this Ordinance allows the Board to adopt well permit fees to recover Valley Water’s costs required for the review of well permit applications, issuance of well permits, inspection of permitted well work, and Board hearings of permit appeals.
Valley Water’s permitting charges, or fees, are subject to Article XIIIC of the California Constitution (Proposition 26, passed by voters in 2010). In general, any public agency fee or charge is considered a “tax” subject to voter approval unless it falls under one or more statutory exceptions. Here, the proposed well permit and inspection fees are not taxes because Proposition 26 (Article XIIIC, Section 1(e) of the California Constitution) provides an exemption for “[a] charge imposed for a specific government service or product provided directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of providing the service or product,” as well as for “a charge imposed for the reasonable regulatory costs to a local government for issuing licenses and permits, performing investigations, inspections, and audits . . . and the administrative enforcement and adjudication thereof.” (Cal. Const. Art. XIIIC, sec. (1)(e)(2) & (3).)
The proposed well permit fees are based on the average time it takes staff to complete permit processing, to travel to and from a well site for one inspection, to complete an inspection, and to complete the necessary inspection documentation. Costs for permitting and inspections are different for each permit type due to differences in permitting complexity, time to complete inspections, and the amount of work necessary to complete inspection documentation. None of the proposed fees exceed Valley Water’s reasonable costs in providing well permitting and inspection services.
To discuss some proposed revised fees more specifically, first, the current fee for permit processing, inspections and inspection documentation for exploratory borings ($375.00) does not put a cap on the number of borings or the number of inspections completed for one permit request for an event. For example, if a permit request for the construction of a street, bridge or other construction project requires 100 exploratory borings, the $375 fee does not come close to covering our well permitting, inspection or documentation costs for all 100 exploratory borings. Thus, the proposed fee schedule is revised to recover our costs for exploratory borings permitting and inspections, based on the number of borings required to be permitted and inspected.
Valley Water also receives approximately 10 requests in a year for weekend or holiday inspections for wells located in commercial areas to avoid disruption of access during weekdays. To recover Valley Water labor costs, the proposed fee schedule includes the fees for the weekend and holiday inspections and inspection documentation.
The current fees are based on performing one inspection for all the permit types. On several occasions, staff have performed multiple inspections if the issues are encountered in the field. The proposed fee schedule includes fees for additional inspections.
This matter was brought to the Board Policy and Monitoring Committee on October 7, 2025. At that meeting, the Committee voted to recommend that the full Board approve a resolution adopting these increased fees or charges.
Attachment 2 shows recommended changes to the current fee schedule, based on the results of staff’s cost study and comparison with Bay Area Agencies Fee Average.
The proposed Board resolution and associated Exhibit A with the updated well permit fee schedule is shown in Attachment 3.
Similar to Resolution 17-52, the proposed, updated Resolution delegates authority to the Valley Water Chief Executive Officer (CEO) to enter into agreements with other public entities for a mutual waiver of like-kind permit fees when the CEO determines that a fee waiver is in the best interest of Valley Water. Based on the number of permits typically issued to other public entities, staff estimates that these waivers will not exceed $10,000 annually.
ENVIRONMENTAL JUSTICE IMPACT:
This action is unlikely to or will not result in disproportionate impacts on any specific communities relative to the general population.
FINANCIAL IMPACT:
Based on the number of permits issued in Fiscal Year 2025, annual revenue by well permit fees is estimated to increase by approximately $400,000. As stated above, permit fees waived to public entities could reduce this amount by approximately $10,000, annually. Collection of well permit fees is implemented by Wells and Water Measurement Unit staff and is recorded as revenue to Fund 61 (Water Utility).
CEQA:
The recommended action is exempt from the requirements of CEQA pursuant to the statutory exemption of Public Resources Code Section 21080(b)(8), exempting the “establishment of charges for the purpose of meeting operating expenses….”
ATTACHMENTS:
Attachment 1: SCVWD Resolution No. 17-52
Attachment 2: Current Well/Permit Fees Comparison
Attachment 3: Resolution
UNCLASSIFIED MANAGER: Manager
Greg Williams, 408-630-2867