BOARD AGENDA MEMORANDUM
Government Code § 84308 Applies: Yes ☐ No ☒
(If “YES” Complete Attachment A - Gov. Code § 84308)
SUBJECT: Title
Consider the June 8, 2026, Water Supply and Demand Management Committee Recommendation to Authorize Payment of up to $1,344,613 for Valley Water’s Share of Project Planning Costs for the B.F. Sisk Dam Raise and Reservoir Expansion Project and receive an update.
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RECOMMENDATION: Recommendation
Authorize Payment of up to $1,344,613 for Valley Water’s Share of Project Planning Costs for the B.F. Sisk Dam Raise and Reservoir Expansion Project and receive an update.
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SUMMARY:
Valley Water has provided $3,444,063 to date to support funding the planning and development of the B.F. Sisk Dam Raise and Reservoir Expansion Project (Project). Additional funds will be needed on September 1, 2026, to continue the next phase of planning work.
The U.S. Bureau of Reclamation (Reclamation) and the San Luis & Delta-Mendota Water Authority (SLDMWA), acting on behalf of six members, including Valley Water, are jointly developing the Project. This Project will raise the existing B.F. Sisk Dam by 10 feet and increase the storage capacity of San Luis Reservoir by 130,000 acre-feet (AF), of which 63,560 AF is currently reserved for Valley Water - an amount of storage larger than all of Valley Water’s reservoirs except for Anderson Reservoir. This Project is separate from the B.F. Sisk Safety of Dams Modification Project (SoD Project), which addresses seismic risks of the existing dam and will not increase the storage capacity.
The Project is included in the Water Supply Master Plan 2050, approved by the Board in November 2025, as a part of the lower cost strategy to diversify storage and supply to ensure a sustainable water supply for the community.
Project Costs
Previous Project costs authorized by Valley Water’s Board at the April 8, 2025 Board meeting supported project advancements as outlined in this memorandum. Project managers anticipate additional funds will be needed in September 2026 and are requesting project participants to provide $1,925,000 through February 2027 to cover continued program management, planning, and design. Valley Water’s share is $1,344,613. The Water Supply and Demand Management Committee approved staff’s recommendation that the Board authorize payment of $1,344,613 to cover Valley Water’s share of project costs through February 2027 at their June 8, 2026 meeting.
The capital cost estimate for the Project ranges from $847 million to $1,045 million, including an escalation rate to the mid-point of construction and design and construction contingencies, but not including financing costs. The cost estimate range reflects that there have been cost savings realized from recent design decisions for State Route 152 (SR 152) and that other costs, such as securing required mitigation credits, are highly variable at this stage. At Valley Water’s current participation level of 63,560 AF, Valley Water’s share of project costs ranges from $414 million to $512 million. A revised cost estimate is anticipated to be released by Fall 2026.
Contributed Funds Agreement and Spend Plan
In August 2025, a Contributed Funds Agreement between Reclamation and the California Department of Water Resources (DWR) was executed. This agreement outlines the agreed upon share of Project costs of 70% as the Project members share through SLDMWA and 30% as the Federal share through Reclamation and provides a mechanism for the transfer of funds to Reclamation. Additionally, a Spend Plan between Reclamation and SLDMWA was executed, which enables parties to track costs expended and outlines when funds will be transferred.
SLDMWA Procurement Policy
In August 2025, SLDMWA adopted a revised procurement policy to prepare for large projects such as this Project. The revised policy allows for alternative project delivery methods, such as a progressive design-build. A traditional “design-bid-build” approach executes the design and build processes under separate contracts. A progressive design-build is being considered for the SR 152 portion of this project and enables one contractor to serve as the designer and the builder, enhancing collaboration, improving costs and increasing transparency.
Highway 152 Construction
A major component of the Project involves the California Department of Transportation (Caltrans) modifying California SR 152 by raising an estimated one-mile stretch of the roadway by about ten feet and adding slope protection to an overlook. Recent updates to design criteria will result in cost savings.
A previous design alternative included flattening slopes around an embankment. After further seismic analysis, it was found that the embankment can maintain its existing slope. This update significantly reduces the volume of material, construction time, and transport trips needed. The reduction in volume of material needed makes it feasible to transport materials by trucks, rather than by barge and tugboat as was previously contemplated.
Schedule and Next Steps
Near-term work on the Project includes the completion of a Coordination Agreement; completion of the 30% design stage; work on the intake and outlet works; continued permitting and mitigation identification; progress on the revised SR 152 design concept; and the development of a Finance Plan.
The Coordination Agreement is currently being developed. It is a mechanism that defines how Project partners and Reclamation will communicate, work together, and manage responsibilities. After the Coordination Agreement is complete, work on the Operations, Maintenance, and Replacement Agreement will begin. It is a mechanism for assigning responsibilities and costs associated with operations and maintenance aspects of the dam raise.
The 30% design milestone is anticipated in August 2026. It will be the basis for a construction schedule and cost estimate revision by Fall 2026. Project partners are discussing intake and outlet works cost allocation, design selection, and the schedule of construction with various levels of personnel at Reclamation. Design work is anticipated to continue through mid-2028 prior to the start of construction. Construction of the dam raise is anticipated to be completed in 2034, though aspects of the SR 152 and intake and outlet works construction may continue until early 2037.
The final participation decision for the Project is expected to occur before August 2028.
ENVIRONMENTAL JUSTICE IMPACT:
There are no environmental justice impacts associated with this item.
FINANCIAL IMPACT:
Valley Water’s maximum cost share to cover Project planning costs will be $1,344,613. The Project is currently funded in the IW San Felipe Division Deliveries Project, Project No. 91131006, included in the FY 2026-27 (FY 27) Adopted Budget. There are adequate funds encumbered to cover these costs.
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
*Handout 5.3-A: T. Moniz-Witten
UNCLASSIFIED MANAGER: Manager
Vincent Gin, 408-630-2633