BOARD AGENDA MEMORANDUM
SUBJECT:
Title
Overview of the District’s Water Infrastructure, Wholesale Supply and Financial Projections. (Previously Listed as Item 5.3)
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RECOMMENDATION:
Recommendation
That the Santa Clara Valley Water District Board of Directors and Milpitas City Council direct their respective staff to continue their commitment to meaningful engagement in pursuit of new and innovative partnership opportunities for the continued delivery of a safe, and reliable water supply in Santa Clara County.
Body
SUMMARY:
This item describes various programs that the Santa Clara Valley Water District (District) provides in support and partnership with the City of Milpitas (City) as they provide a safe and reliable water supply in the City.
As the groundwater management agency and primary water resources agency for Santa Clara County (County), the District has a mission to provide safe, clean water for Silicon Valley. In 2012, the Board adopted the Water Supply and Infrastructure Master Plan (Water Master Plan) which outlines the District’s strategy for providing a reliable and sustainable future water supply for the County and ensuring new water supply investments are effective and efficient. The three key elements of the Water Master Plan strategy are 1) secure existing supplies and infrastructure, 2) optimize the use of existing supplies and infrastructure, and 3) expand water conservation and recycled water use to meet future increases in demands.
The District’s Water Master Plan is intended to be updated every five years to adjust to changing conditions. Based on recent analyses, the County could experience shortages of up to 30 percent during extended droughts as demands increase, even with full implementation of the 2012 Water Master Plan. District staff is in the process of updating the Water Master Plan to present the strategies needed to meet the District’s water supply reliability goal.
Water Supply Overview
To meet the future water needs and promote greater resource diversity, the District continues to explore additional water supply and water demand reduction options. Pursuing supply diversity helps minimize the potential risks of groundwater overdraft and subsidence, as well as overreliance on imported water supplies. Projects being considered include additional water conservation, potable reuse, surface and groundwater storage, stormwater capture, additional recharge ponds, dry year options, etc.
Currently, the District’s water supply portfolio includes 55% imported water sources, 40% local water sources (groundwater, treated), and 5% recycled water. Similarly, the water portfolio for the City is comprised of 55% Hetch Hetchy Water, 36% District Treated Water, and 9% Recycled Water. It is important to note that like the District, the City is planning to increase its use of recycled water in its supply portfolio.
Infrastructure Overview
The District operates a complex infrastructure and integrates natural and constructed systems to capture and convey raw and treated water. The District’s system can deliver about 300 million gallons of raw water and 200 million gallons of treated drinking water every day. The District’s distribution system includes 10 reservoirs, 3 pump stations, 142 miles of pipelines, 4 water treatment plants, 393 acres of recharge ponds, and 275 miles of jurisdictional streams.
The District plans to invest approximately $2.1 Billion in its 5-year Capital Improvement Program to ensure the reliability of our water supply infrastructure. Some of the current/recent capital investments include:
v 10-Year Pipeline Inspection & Rehabilitation Program - This Program involves the inspection, planning, design, and renewal of the District’s pipelines and tunnels to rehabilitate distressed pipe sections as required, and replace old valves, flow meters, pipeline appurtenances assemblies, and piping, as appropriate. In the next two years, the Program work will include the Cross Valley Pipeline, Calero Pipeline, and the Central Pipeline.
v Penitencia Force Main/Delivery Main Seismic Retrofit - This recently-completed project included the replacement of about 900 lineal feet of each of three pipelines - the 60-inch diameter Penitencia Force Main, 66-inch diameter Penitencia Delivery Main, and 72-inch diameter South Bay Aqueduct, currently conveying raw and treated water to and from the Penitencia Water Treatment Plant. The Project has reduced the potential damage to and post-earthquake recovery time of the pipelines and the associated vault structures.
v Anderson Dam Seismic Retrofit - The District is in the process of retrofitting four of its dams and associated infrastructure to meet current seismic design standards and other Division of Safety of Dam (DSOD) design and operational criteria. The current estimated investment for these four projects is $780M. Anderson Dam is the largest of the District’s dams, with a retrofit cost of $550M. Anderson Dam’s project work will include excavation and reconstruction of its embankments; replacement of the intake structure and installation of two new outlet pipes; and replacement of the emergency spillway structure.
Anderson Dam Construction and Potential Flooding Impact on Coyote Creek
The Anderson Dam construction project is estimated to be a 4- to 5-year endeavor. During two consecutive winter seasons during this construction period, the dam embankment will be about 80 feet below its current height of 647 feet above sea level. Watershed runoff generated by winter storms in those two seasons will have to be conveyed directly to Coyote Creek to prevent the interim dam from being overtopped. To do this, the District will construct a diversion tunnel from the bottom of Anderson Reservoir to Coyote Creek as part of this project. The volume of water diverted through the tunnel will be controlled by the District. Statistical simulations have been conducted as part of the project planning to determine an operating rule curve for the interim dam during those two winter seasons. Based on nearly 40 years of historic rainfall data at Anderson Dam 100,000 simulations of annual rainfall were modeled. The results indicate that 98% of the flows diverted from the Anderson/Coyote Watershed to Coyote Creek would be no greater than 1,000 cubic feet per second (cfs). Before Anderson Dam construction begins, the District’s Office of Emergency Services will establish communication protocols with the cities of San Jose and Milpitas to share real-time flow diversion information and to provide warning, as necessary, of higher-than-normal diversions in the event of heavy, back-to-back storm systems.
Water Conservation Overview
The District’s water conservation program is a key part of its core business, reducing demand by approximately 73,000 acre-feet in FY2018. Water use efficiency programs reduce demand on existing water and energy supplies, helping to lessen the costs and environmental impacts of developing additional supplies. Conservation program elements include a variety of rebate programs for home, landscaping, and businesses as well as service calls and conservation tools. The District plans to increase water conservation contribution savings to 110,000 acre-feet per year by 2040.
Future Opportunities
California Water Fix - The Board has agreed to participate in the California WaterFix project subject to 7 guiding principles. This will allow the District to continue to work with the state and our partner water agencies to negotiate the best deal for the County and ensure the resulting project adheres to our conditions and the Board’s guiding principles for participation.
No Regrets Package - On September 19, 2017, the Board authorized staff to begin planning for implementation of the projects and programs in the Water Supply Master Plan’s “No Regrets” package. The package consists of the following water conservation and stormwater capture projects:
• Advanced metering infrastructure,
• Graywater Rebate Program expansion,
• Leak repair incentives,
• New Development Model Ordinance, and
• Stormwater capture (agricultural land recharge, stormwater recharge in the Cities of San Jose and Saratoga, rain barrel rebates, and rain garden rebate).
How Water Supply Services Are Funded
The District is the groundwater management agency and primary wholesale water provider in the County. The District actively manages the groundwater basins by replenishing them with local and imported water, and by operating surface water treatment plants that provide “in-lieu” recharge. A complex system that includes 10 reservoirs, 142 miles of pipelines, 4 water treatment plants, and 3 pump stations, helps keep water flowing across the county.
The cost to operate and maintain this system is reimbursed primarily through groundwater charges and treated water charges paid by water retail customers. Groundwater charges differ depending on the “zone of benefit.” The North County (Zone W-2) is defined as the portion of the County north of the Coyote Valley. The South County (Zone W-5) is defined as the portion of the County extending from Coyote Valley to Gilroy.
Resolution 99-21 guides staff in the development of the overall pricing structure based on principles established in 1971. The general approach is to charge the recipients of the various benefits for the benefits received. More specifically, pricing is structured to manage surface water, groundwater supplies and recycled water conjunctively to prevent the over use or under use of the groundwater basin.
Each year, the Board establishes groundwater production charges as well as surface water charges, recycled water charges, treated water surcharges, and the amount of the State Water Project cost to be recouped through the State Water Project tax. Staff’s proposed groundwater charge increase for North County Zone W-2 for Fiscal Year 2018-19 equates to an increase of $3.92 per month to the average household and is driven by critical infrastructure repair and replacement needs such as those listed in this memo, and efforts to bolster water supply reliability (this does not include any increase from the retail provider).
Below are the key upcoming dates for the groundwater charge setting process. The schedule calls for adopting the budget and groundwater production charges on May 8, 2018, which would become effective on July 1, 2018.
Mar 21: Water Retailers Meeting (Groundwater Production Charge recommendation)
Apr 10: Board Meeting (Open Public Hearing on Groundwater Production Charges)
Apr 11: Water Commission Meeting (Groundwater Production Charge recommendation)
Apr 12: Board Meeting (Continue Public Hearing on Groundwater Production Charges to South County)
Apr 24: Board Meeting (Continue and Conclude Public Hearing)
Apr 25-27: Board Meetings - Budget Work Study Sessions
May 8: Board Meeting (Adopt Groundwater Production Charges, Budget & CIP)
FINANCIAL IMPACT:
There is no fiscal impact from this presentation.
CEQA:
The recommended action does not constitute a project under CEQA because it does not have a potential for resulting in direct or reasonably foreseeable indirect physical change in the environment.
ATTACHMENTS:
Attachment 1: PowerPoint
UNCLASSIFIED MANAGER:
Manager
Nina Hawk, 408-630-2736