BOARD AGENDA MEMORANDUM
SUBJECT:
Title
State Water Project Tax Discussion.
End
RECOMMENDATION:
Recommendation
Consider information provided by staff and provide policy direction as necessary.
Body
SUMMARY:
The purpose of this discussion is to review the District's usage of the State Water Project (SWP) tax, including forecast assumptions for the upcoming water rate setting cycle. This review will include much of the same information presented to the Board during several discussions on this topic in calendar years 2014 and 2015. Those discussions included an overview session on July 8, 2014, a workstudy session on November 18, 2014, a follow-up session on December 16, 2014, and a review on October 27, 2015. Staff is seeking direction that can be incorporated into the FY 2017-18 water rate setting process.
This review is divided into two topics of discussion:
1. An overview of the SWP tax
2. A review of policy issues and alternatives
SWP Tax
Background
The SWP is a conveyance system that includes a series of 21 dams and reservoirs, 5 power plants, and 16 pumping plants from Lake Oroville in Northern California to Lake Perris in Southern California. The South Bay Aqueduct is a 40 mile branch that conveys water to three agencies from the Sacramento-San Joaquin Delta including Zone 7 Water Agency, Alameda County Water District, and the Santa Clara Valley Water District. It is managed by the California Department of Water Resources (DWR).
The District entered into a contract with DWR in 1961 to import water into Santa Clara County through the SWP and is one of 29 SWP contractors. Article 34 of the District's SWP contract obligates the District to levy a tax upon all property in the District not exempt from taxation if other funding sources are insufficient. This decision rests within the discretion of the Board. In addition, section 11652 of the Water Code provides that districts with water contracts "shall whenever necessary, levy upon all property in the...
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