HomeMy WebLinkAbout12/06/2005, PH6 - URBAN WATER MANAGEMENT PLAN UPDATE counat
acEnba nepoRt N
CITY OF SAN LUIS OBISPO
FROM: John Moss, Utilities Directo
Prepared By Gary Hende n,Water Division Manager
Ron Munds, Utilities Conservation Coordinator
SUBJECT: URBAN WATER MANAGEMENT PLAN UPDATE
CAO RECOMMENDATION
Adopt a resolution approving the update to the Urban Water Management Plan.
DISCUSSION
Background
The Urban Water Management Planning Act requires water purveyors which serve 3,000_or more
customers or deliver more than3,000 acre feet of water per year to submit a Urban Water
Management Plan (UWMP) every five years (years ending in -00 and -05) to the Department of
Water Resources. The City Council adopted the City's first UWMP in November 1994. An
updated plan was approved and submitted to the State in the year 2000. Staff has updated the
plan in accordance with the provisions of the Urban Water Management Planning Act (as
amended) and will submit the revised plan to the State upon adoption. The Executive Summary
of the Plan is included as Attachment 1 to this report with.the entire document available in the
Council Office for review.
The specific objectives of the City's Urban Water Management Plan can be summarized as
follows:
1. Provide policy as a basis for future water planning relative to new development within the
community.
2. Provide a description of all water supply, treatment, conveyance/distribution facilities.
3. Provide estimates of future supplemental water requirements based on population
projections developed from the General Plan Land Use Element and per capita water use
figures.
4. Provide an evaluation of alternative water supply sources, both short and long term, that
could meet both existing and future water requirements.
5. Summarize the water treatment processes and regulations, and identify the water
treatment, distribution and storage system's current deficiencies and future recommended
improvements.
6. Evaluate water operatingprograms.
7. Comply with the U _-Urban Water Management Planning Act (as amended).
8. Provide a plan for any future water shortage situation.
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Another important purpose in adopting the UWMP is that it qualifies the City for any future
grant or other State funding possibilities, such as Proposition 50, future drought assistance and
State Revolving Loan monies, such as the funding source for the Water Reuse Project .
When looking at the plan as a whole, the most significant changes since the year 2000 update
involve updating dates and schedules for the water supply projects and identifying system
deficiencies and the recommended improvements. The water policies in Chapter 2, which are the
same as the Water Element to the General Plan, have been updated to reflect the changes that
have occurred since the year 2000 update and are noted in the Chapter 2 summary below.
Though there are no recommended policy changes in Chapter 2, changes have been made to
"cleanup" language and/or modify the background information to make the policies more
consistent with the changes that have occurred over the past five years. Staff will be returning to
the Planning Commission and City Council at a future date with these changes for formal
adoption and inclusion in the Water Element.
The following is a summary of the changes made to the plan.
Chapter One Introduction
Chapter One provides a brief overview of the plan, then details the City's sources of water
supply and operational information. Three new sections were added to this chapter to meet the
State's requirements. The new or modified sections are as follows:
1. Section 1.3, "Water Service Area Description" has been expanded to include weather
information.
2. Section 1.4.3, "Groundwater" has been expanded to discuss the groundwater basin in
more detail, including projected use of groundwater..
3. Section 1.4.4, "Reliability" of Supplies was added as required by amended State law.
4. Section 1.4.5, "Agency Coordination" was expanded to include the Nacimiento
Project Commission and the City's involvement with the County's Integrated
Regional Water Management Plan.
The other changes to the chapter are minor modifications to reflect operational variations since
the adoption of the 2000 UWMP.
Chapter Two Water Policy
The UWMP adopted in 1994 identified the water policies in Chapter Two as being the Water
Element to the General Plan. The Water Element has been modified several times since the
adoption of the UWMP in 2000 and those modifications are reflected in this update. These
previously approved modifications and the dates approved are as follows.
1. Elimination of the Reliability Reserve policy, elimination of the mandatory Offset policy,
added language regarding accounting for siltation and accounting for reclaimed water
(September 2002)..
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2. Various policies relating to supplemental water supplies, primarily the Nacimiento
Project(June 2004).
Though no changes to Chapter Two are being recommended at this time, as mentioned
previously, staff has identified inconsistent language and other out, of date background
information that needs to be updated. Since these modifications will require an amendment to
the Water Element to the General Plan, staff will be returning to the Planning Commission and
the Council at a future date to resolve these issues.
Chapter Three Supplemental Water Supply Projects
Chapter Three describes all of the water supply projects under consideration plus some
alternative projects that could be considered in the future. The changes to the chapter mainly
consist of updating the information to reflect the current status of each of the water projects.
More detailed discussions are included in the Water Reuse and Increased Groundwater
Production sections to reflect the studies, master plans and other information that has changed
since the year 2000 UWMP. The current projects are:
1. Nacimiento Project
2. Water Reuse
3. Water Demand Management (conservation)
An update of the projects, including the water conservation program, will be discussed in detail
when Council is presented the Annual Water Status Report in June of this year.
Chapter Four Water Operational Programs
Chapter Four describes the existing water system, operation and maintenance programs, staffing
evaluations, and identifies current and future system def ciencies: Most of the changes in the
chapter are revisions to reflect minor operational changes since the last update in 2000. In
addition, updates in Section 4.2.3, Water Distribution Infrastructure Evaluation reflect progress
made on projects identified as deficiencies in the October 2000 Water Master Plan. .
Chapter Five Water Fund Financial Plan
Chapter Five explains the policies and procedures for setting water rates which insure there is
adequate revenue to recover all operating costs. There have been no modifications to this chapter
since there have been no changes in the way water rates are determined..
Chapter Six Water Shortage Contingency Plan
In the year 2000 UWMP, the Water Shortage Contingency Plan (WSCP) was included as an
appendix. In order to better comply with the new State requirements for plan updates,the WSCP
was moved into the main document. The WSCP was reviewed and approved by the Council and
CouncilAgenda Report—Urban Water Management Plan Update
Page 4
the Planning Commissioners at the joint study session held in July 2000. The highlights of the
plan are:
1. Residential per capita water allocation methodology versus a percent reduction system.
2. Revised action levels based on gallons per person per day.
3. Commercial allocations based on either a percent reduction methodology or a baseline
allocation determined by business type.
4. Significant penalties for exceeding water allocations during mandatory conservation
periods.
There have been no modifications to the WSCP since the year 2000 update.
Appendices
Appendix I
Appendix I is a summary of the water policies contained in Chapter Two. It is meant to be a
quick reference and summary of each policy. The changes to the appendix are discussed in
Chapter Two of this report.
Appendix H
Appendix II is a description of the Water Conservation.Program's components and services. An
update to the "Best Management Practices" is included, as well as an update to the evaluations of
technologies and programs section.
Appendix III
Appendix III contains the most recent Water Fund analysis which was presented to Council in
June 2005.
CONCURRENCES
The Community Development and Finance Departments concur with the recommendations made
in this report: Because this update does not modify the Water Management Element of the
General Plan, Planning Commission review was not necessary. However, as noted in the report,
staff will be returning the Council with the minor modifications to Chapter 2 in regards to text
references and background information in the policies.
FISCAL UVWACT
Adoption of the updated Urban Water Management Plan (UWMP) document does not directly
create additional fiscal impacts on the Water Fund. Conceptual approval of water policies does
not approve work programs or budget. However, the policies contained in the Urban Water
CP y
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Page 5
Management Plan do have financial implications, all of which are examined in detail in the
Water Fund review presented to Council annually in June.
ATTACHMENTS
Attachment 1- Executive Summary to Urban Water Management Plan
Attachment 2- Resolution to adopt the Urban Water Management Plan
Available in Council Office for Reviews Urban Water Management Plan
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Attachment 1
Executive Summary
PURPOSE AND SCOPE
The purposes of the Plan are to assist in formulating long_range City water policy,
determine needed improvements in the water supply and distribution systems, identify
needed expansion to reach General Plan goals,and develop a financial plan for achieving
the recommendations presented in.this document.
The specific objectives of the Plan can be summarized.as follows:,
• Provide estimates of future supplemental water requirements based the Land Use
Element and per capita water use figures.
• Provide an evaluation of alternative supplemental supply sources that could meet
projected water requirements.
• Summarize water treatment processes and regulations, and identify the water
treatment, distribution and storage systems current deficiencies and future needs.
• Consolidate previous water policy.
• Evaluate the Implementation of the Water Conservation Program.
• Comply with State Law, AB 797, the Urban Water Management Planning Act.
URBAN WATER MANAGEMENT PLAN SUMMARY
This Executive Summary condenses the Plan into the following six main areas:
1.2 The Plan's Relationship to the General Plan
1:4 Current Water Supply Sources
2.0 Water Policy
3.0 Supplemental Water Supply Projects
4.0 Water Operational Programs
5.0 Water Fund Mriancial Plan
6.0 Water Shortage Contingency Plan
1.2 THE PLAN RELATIONSHIP TO THE GENERAL PLAN AND OTHER
DOCUMENTS
Chapter 2 of this Plan reflects the General Plan's Water Management Element, first
adopted in 1987. This plan includes all information needed to comply with state law AB
797, the Urban Water Management Planning Act.. Progress in the implementation of this
plan will be presented to the Council on Yearly basis as part of the Annual Water Status
Report.
1.3 WATER SERVICE AREA DESCRIPTION
The City of San Luis Obispo is located halfway between.Los.Angeles and San Francisco,
situated in a coastal valley approximately 10 miles from the Pacific Ocean. It's
Mediterranean climate provides for mild and dry summers and cool winters, with an
average rainfall of about 20 inches per year:
Attachment 1
1.4 CURRENT WATER SUPPLY SOURCES
The City of San Luis Obispo currently receives water from three sources, Salinas
Reservoir, Whale Rock Reservoir, and local groundwater. The City has depended on
imported supplies from Salinas Reservoir, located near the community of Santa
Margarita, since 1944 and Whale Rock Reservoir, located near the community of
Cayucos, since 1964. With the onset of the drought in 1986, resulting in decreasing
surface water supplies,the City activated its groundwater sources in 1989.
The Whale Rock Reservoir provides water to the City of San Luis Obispo, California
Polytechnic State University, and the California Men's Colony as well as the town of
Cayucos. The City staff work closely with staff from the other entities relative to water
planning issues.
The City of San Luis Obispo is represented on the county-wide Water Resources
Advisory Committee (WRAC). The WRAC is an advisory committee to the County
Board of Supervisors on issues pertaining to water resource planning.
The City will strive to strengthen the reliability of the water supplies available to the City
to meet current and future water demands. Policies contained in Chapter 2 which support
these goals include: safe annual yield, Ovate_r conservation, multi-source water supply and
reclaimed water. As discussed in Section 2.1 Safe Annual Yield, the reliability of water
supplies from Whale Rock and Salinas Reservoirs will be based on the most critical
drought period of the historical record.
The City of Morro Bay and the Whale Rock Commission (which the City is a member
agency) executed an agreement in June of 2000 which provides for Mutual Aid between
agencies during disruption of water deliveries or lack of available water supplies.
2.0 WATER POLICY
The following policy statements and basis for policy summaries provide the foundation
for delivering an adequate "supply of water to meet current and future demands for the
City of San Luis Obispo.
2.1 SAFE ANNUAL YIELD POLICY
2.1.1 Basis for Planning
The City will plan for future development and for water supplies based on the amount of
water which can be supplied each year, under critical drought conditions. This amount,
called."safe annual yield", will be adopted by the City Council. The safe annual yield
determination will be revised as significant new information becomes available, and as
water sources are gained of lost. The determination will consider a staff analysis, which
will recommend an amount based on coordinated use of all water sources. Each change to
safe annual yield will be reflected in an amendment of the Water Management Element
and will be updated in this plan every five years.
Attachment I
2.1.2 Safe Yield Amount
The City's safe annual yield, from the coordinated operation of Salinas and Whale Rock
Reservoirs and 500 acre l feet of groundwater, is shown in Table 2.1.1 The safe annual
yield includes reductions due to siltation at the reservoirs, discussed in more detail in
Section 2.5.
2.1.3 Groundwater
A. The amount of groundwater which the City will rely upon towards safe annual
yield is identified in Section 2.11. The City Will maximize the use of groundwater in
conjunction with other available water supplies to maximize the yield and long term
reliability of all water resources and to minimize overall costs for meeting urban water
demands. The City shall monitor water levels at the well sites to determine whether
reduction or cessation of pumping is appropriate when water levels approach historic low
levels.
B. The City will not compete with local agricultural use of groundwater outside the
urban reserve line or damage wildlife habitat through reduced natural stream flows in
obtaining long-term sources of water supply.
Background
The safe annual yield of a reservoir depends on rainfall, the resulting runoff, evaporation,
and releases for purposes other than the supply in question (such as required release's for
downstream uses), The estimation of safe annual yield is based on historical hydrological
data.
The City has developed a mathematical computer model of the Salinas and Whale Rock
Reservoirs, which accounts for all the factors that affect a safe yield estimate. The current
safe annual yield amount results from using data froth 1943 through 1999. This period
includes the drought periods of 1946-511, 1959761, 1976-77, and 1986-91.
The current calculation reflects taking advantage of differences between the reservoirs
through coordinated operation which means the City uses Salinas first, since.it gains and
loses water faster than Whale Rock, which is used as a backup source,
2.2 WATER CONSERVATION POLICY
-2.2.1 Long-term Water Efficiency
The City will implement water efficiency programs which will maintain long-term, per
capita usage at or below the per capita use rate as identified in.Section 2.3.2.
2.2.2 Short-term Water Shortages
Short-term mandatory measures, in addition to the long-term programs, will be
implemented When the City's water supplies are projected to last three years or less,
based on,projected waterconsumption, coordinated use of all City water supplies sources,
and considering the drought pattern on which safe yield is based (or in response to other
situations which may interrupt water supply).
Attachment 1
Background
Water conservation was first referenced as a part of the City's water management policy
in the 1973 General Plan. In 1985; the City adopted the Annual Water Operational Plan
policy which established water conservation as a means to extend water supplies during
projected water shortages. Since 1990, many technological and philosophical changes
have occurred which are proving water conservation to be both a short term corrective
measure for immediate water supply shortages and a long term solution to water supply
reliability.
2.3 WATER DEMAND PROJECTIONS POLICY
2.3.1 Basis of Projections
The City will project water requirements, considering long-term conditions and the full
range of water uses in the City.
2.3.2 Water Use Rate
The City shall use 145 gallons per person per day (approximately 0.162 acre-feet per
person per year) and the number of City residents to plan total projected future water
demand. This quantity will be revised if warranted by long-term water use trends,
including differences in the relationship between residential and nonresidential usage.
(Throughout this Plan, 145 gallons per person per day is used in computations of future
water demand):
2.3.3 Overall Projected Water Demand
Applying 145 gallons per person per day to a projected City resident population of about
56,000 at General Plan build-out results in a projected water demand of 9,096 acre-feet
per year, (excluding demand from the Cal Poly campus, which has separate entitlements).
2.3.4 Present Water Demand
Present water demand shall be calculated by multiplying the water use rate identified in
Section 2.3.2 by the current city population (as determined by the California Department
of Finance, Population Research Unit).
2.3.5 Peak Daily Water Demand
The City shall strive to develop and maintain water supply sources and facilities
appropriate to ensure sufficient supply and system capacity to provide the peak daily
water demand of the City.
BACKGROUND
The City must know how much water will be needed to serve residents, businesses, and
other users which could be accommodated by the General Plan. This quantity can be
projected using different methods. All methods involve assumptions about both future
usage rates and the numbers and types of users expected in the future. The quantity
expressed in the policy above corresponds closely with both (1) total citywide usage
compared with total resident population and (2) projections of water demand based on
usage by various land use categories.
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Attachment 1
2.4 SILTATION AT SALINAS AND WHALE ROCK RESERVOIRS POLICY
The City shall account for siltation in the adoption of the safe annual yield as identified in
Policy 2.1.2. The estimated annual reduction in safe annual yield from Salinas and Whale
Rock Reservoirs is 10 acre-feet per year.
Background
Siltation at reservoirs is a natural occurrence which can substantially reduce the storage
capacity over long periods. The reduction of available storage will reduce the safe annual
yield of the reservoir. Siltation at reservoirs varies depending on factors such as rainfall
'intensity and watershed management practices. There have been numerous reports
addressing siltation at Salinas Reservoir,.but no studies have been done for Whale Rock
Reservoir.
During the recent drought, water at Salinas Reservoir fell to a record low level. An aerial
survey of the reservoir was prepared in order to update storage capacity information. The
latest information indicates that the siltation rate is on the order of 40 acre-feet per year.
Since no information is available to indicate what rate of siltation is occurring at the
Whale Rock Reservoir, it is assumed for planning purposes that the annual average rate
of siltation is similar to Salinas Reservoir.
2.5 SUPPLEMENTAL WATER REQUIREMENTS POLICY
2.5.1 Supplemental Water Requirement
The City shall develop additional water supplies to provide for the Primary Supply
Requirements identified below, and strive to develop additional water supplies to provide
for the Secondary Supply Requirements identified below, in the consideration of
available water supply opportunities.
A. Primary Supply Requirements — Develop supplemental water supplies to provide
sufficient water for General Plan build-out using the per-capita planning use rate
identified in Policy 2:3.2 multiplied by the projected General Plan build-out population,
and
B. Secondary Supply Requirements — Develop supplemental water supplies to provide
additional yield to account for future siltation losses, drought contingency, loss of yield
from an existing supply source, operational requirements necessary to meet peak
operating demands, and other unforeseen conditions.
2.5.2 Supplemental Water Sources
In deciding appropriate sources of supplemental water; the City will evaluate impacts on
other users of the water and other environmental impacts, total and unit costs, reliability;
water quality, development time, and quantity available.
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Attachment 1
2S.3 Paying for Supplemental Water for New Development
The cost for developing new water supplies necessary for new development will be paid
by impact fees set at a rate sufficient to cover the annual debt service cost of the new
water supplies attributable to new development.
Background
Based on the Land Use Element adopted by the City Council in August 1994 and a per
capita use rate of 145 gallons per person per day, the projected total amount of water for
the City to .serve General Plan build-out is 9,096 acre-feet. Many of the Secondary
Supply Requirements identified in Policy 2.5.l(B) are unquantifiable at this time, and
their development should be considered by Council in the review of new water supply
opportunities.
2.6 MULTI-SOURCE WATER SUPPLY POLICY
The City shall continue to develop and use water resources projects to maintain multi-
source water supplies, and in this manner, reduce reliance on any one source of water
supply. and increase its supply options in future droughts or other water supply
emergencies.
Background
Having several sources of water can avoid dependence on one source that might not be
available during a drought or other water supply emergency. The Council has supported
having multiple sources since adopting the General Plan Water Management Element
in 1987 and by endorsing the above policy statement in November 1990.
2.7 ALLOCATION OF NEW SUPPLIES POLICY
2.7.1 Balancing Safe Annual Yield and Overall Demand
When new water sources are obtained, the additional safe yield shall be allocated first to
eliminate any deficit between the adopted safe annual yield (Section 2.1) and the present
demand as defined in Policy 2.-3.4, second to eliminate any deficit between adopted safe
yield and General Plan build-out, and third to supply for the Secondary Supply
Requirements as identified in Policy 2.5.1 (B).
2.7.2 Supplying New Development
A. The City will determine the water available for allocation to new development by
either; the adopted safe annual yield of the City's water supplies minus present demand
as identified in Policy 2.3.4, or the projected demand at build-out as identified in Policy
2.3.3 minus present demand as identified in Policy 2.3.4; whichever is less. Available
allocations will be assigned to development.in a way that supports balanced growth,
consistent with the General Plan. Allocations from a new water supply project shall be
considered available at the time project construction is initiated.
B. Any safe annual yield from new water supply projects beyond that needed to
balance safe annual yield and present demand will be allocated to development, subject to
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Attachment 1
the requirements in Policy.2.7.3, "Reserve for Intensification and Infill."
C: A water allocation shall not be required for projects for which the developer
makes changes in facilities served by the City that will reduce long-term water usage
equal to twice the water allocation required for the project.
2.7.3 Reserve for intensification and Infill Development
The City will annually update the water available for allocation based on the difference
between the adopted safe annual yield (policy 2.1.2) and the present.water demand
(policy.2.3.4) as part of the annual Water Resources Status Report. One-half of the water
available for allocation (not to exceed the total required for infill and intensification), as
identified in the Water Resources Status Report, will be reserved to serve intensification
and infill development within existing city limits as of July 1994.
2.7.4 Accounting for Reclaimed_ Water
Reclaimed water has an estimated potential of 1,000 acre feet per year of water available
for appropriate non-potable uses. The amount to be added to the City's safe annual yield,
and therefore available for development, will only be the amount projected actually to be
used or offset (approximately 130 a.f. initially), increasing to 1,000 acre feet per year as
additional offsetting uses are brought on-line. The amount of reclaimed water used each
year will be reported to Council as part of the annual Water Resources Status Report and
Will be added to the safe annual yield identified in Section 2.1.2, Table 2.1 of this
document to determine water available for new development.
2.7.5. Private Water Supplies
When developments are supplied by private groundwater wells, the yield of those wells
will not be counted toward the City's safe annual yield. Such yield, however, will result
in the demand for City water supply being lower than it otherwise would be, which may
necessitate adjustments of the per capita water usage figure used to estimate overall
demand.
Background
The City is pursuing additional water supply projects. The City must address how the
Added yield from these projects will be allocated, since the yield added at any one time
may not supply all potential uses. The City has identified the following potential uses for
the new supplies:
• Eliminating the deficit (if any) between adopted planning water usage
figures and safe yield;
• Compensating for reduced yields due to reservoir siltation;
e Providing for development of more dwellings, businesses, and public
facilities.
The policy's objectives are to balance the needs of all the areas identified while not
compounding the potential water shortage problems for existing residents of the City.
Attachment 1
2.8 WATER ALLOCATION AND OFFSETS POLICY
2.80 Exemptions for Offsets
A. The City will not allow a project to reduce or eliminate the amount of the required
allocation or offset,to the extent that the project is supplied by a private well, with the
following exceptions:
1. The City may reduce the amount of the required water allocation, to the extent
that the project is supplied by a private well serving non-potable water needs (such as
irrigation) which will not significantly affect the yield of City wells. Such a well may be
operated by the owner of the property containing the well only for the owner's use. As an
exemption, the City may allow a well to supply landscape irrigation on more than one
parcel if the irrigation is:
a. for the common area of a condominium complex of other development with
similar common areas as approved by the Utilities.Director, and the well and
irrigation systems are under the control of an owner's association; or
b. in a single commercial development, and the well and irrigation system are.
subject to a recorded agreement among parcel owners, which is acceptable to the
Utilities Director and the City Attorney, and which establishes responsibilities for
operation and maintenance of the common areas served by the well.
2. When an allocation or potential offset is not available, a well may be allowed to
eliminate the required offset for potable water needs only as an interim source until a new
City water source is available. Once a new source becomes available, the project will be
required.to acquire an allocation from the City. Impact fees will be due at the time the
development is approved.
3. The City Council approves the well proposal as part of a specific land
development project approval, and the proposed well system meets all City standards;
and
4. A qualified, independent, hydrological investigation demonstrates that the well(s)
reliably can provide sufficient quality and quantity of water for the proposed land
development project and will not impact the yields from City wells.
2.8.2 Basis for Allocations and Offsets
Required allocations and offsets will be based on long-tern usage for each type of
development. (These use and offset factors will be determined and published by the City,
and may be revised, as warranted by new information.)
Background
In 1988, the City began to formally account for long-term water usage in new
development. As a result of the 1986-1991 drought, the City decided that there should be
no new development that would increase water use unless safe yield and present use was
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Attachment 1
balanced Since 1990, nearly all construction has been replacement buildings, remodels,
or projects.which retrofitted facilities to save (offset) twice the amount of water or water
allocation necessary to serve the project.
2.9 RECLAIMED WATER POLICY
2:9.1 Reclaimed Water Quality
The City will produce high quality reclaimed water, suitable for a wide range of non-
potable uses.
2.9.2 Uses of Reclaimed Water
The City will make available reclaimed water to substitute for existing potable water uses
as allowed by law and to supply new non-potable uses. When deemed appropriate by the
Utilities Director, new development shall be equipped with dual plumbing_ to maximize
the use of reclaimed water for non-potable uses.
Background
Reclaimed water is highly treated wastewater (sewage) which can be used for many non-
potable uses such as landscape irrigation, industrial processes, and toilet flushing in
certain types of buildings. Use of reclaimed water will require a separate_ distribution
system from.potable water lines.
Reclaimed water can be used to supply non-potable uses in new development and to
offset potable uses in.existing development. These potential uses require a deliberate
method to account for reclaimed water use, consistent with policies concerning total
water requirements and other water sources.
2.10 WATER SERVICE WITHIN THE CITY POLICY
A. The City will be the only purveyor of water within the City.
B. Appropriate use of privately owned wells may be allowed with .the approval of the
Utilities Director, consistent with policies 2.8.5 and 2.9.1.
Background
Historically, the City has been the sole water purveyor within. the City limits. This
allowed the City to maintain uniformity of water service and distribution standards, and
to be consistent in developing and implementing water policy. M continuing to be the
sole water purveyor, the City will maintain control over water quality, distribution and
customer service, as well as ensure consistency with the City's General Plan policies and
goals.
3.0 SUPPLEMENTAL WATER SUPPLY PROJECTS
POLICY
The City shall pursue the Nacimiento Reservoir Project, water reuse, water demand
Attachment 1
management activities, and increased groundwater as supplemental water supply sources
to meet current and projected water demand.
INTRODUCTION
The City has been pursuing several water supply options over the past several years to
secure adequate supplies to meet current .and projected future demand. The following
section discusses the projects presently being considered by the City.
3.1 NACIMIENTO RESERVOIR PROJECT
The Nacimiento Reservoir provides flood protection and is a source of supply for
groundwater recharge for the Salinas Valley. It is owned and operated by the Monterey
County Flood Control and Water Conservation District. The San Luis Obispo County
Flood Control and Water Conservation.District (District) has an entitlement of 17,500
acre-feet per year of water from the reservoir. Approximately 1,750 afy have been
designated for use around the lake, leaving 15,750 afy for allocation to other areas within
the County of San Luis Obispo.
In June, 1992; the District retained Boyle Engineering to perform a reliability assessment.
The study concluded that, based on historic data, the project would have been able to
deliver the full entitlement of water each year, including the critical year of the 1987-
1992 drought. Based on these results, the District authorized Boyle to proceed with a
more detailed evaluation of a project to distribute the full remaining entitlement.
In the Fall of 1995, the District retained Boyle Engineering as Project Manager. Carollo
Engineering was hired to perform the preliminary engineering, while Ogden
Environmental was hired to prepare the Environmental Impact Report (EIR) in
compliance with the Califomia Environmental Quality Act (CEQA). In July of 1996,
Carollo published the draft Engineering Report, which identified the project's alignment
and the location of major facilities. In August of 1997, Ogden published the draft EIR.
The public comments on the draft EIR raised a substantial amount of concern over the
pipeline alignment. All of the alignment alternatives that were suggested during public
comment had already been considered and determined to be infeasible for a variety of
reasons.
Following the release of the draft EIR, it was determined that a pipeline route through
Camp Roberts property would be acceptable with Camp Roberts administration, and
would resolve many of the concerns raised by the public. This new opportunity resulted
in the need for additional engineering work and the preparation of a revised draft EIR..
The revised EIR was completed and certified by the County Board of Supervisors in early
2004 and the City Council adopted a resolution certifying the Council's review and
consideration of the EIR and adopting the CEQA findings on June 29, 2004. At the same
meeting following this action, the Council approved execution of the participation
agreement for the Nacimiento Project. The City has requested an entitlement of 3,380
acre feet per year from the Project.
The project is currently proceeding with the design phase which involves development of
�o.�S
Attachment 1
the detailed plans and specifications, surveying, easement/property acquisitions,
additional environmental evaluations and development of detailed environmental
mitigation/monitoring plans. The current project schedule anticipates completing design
work and initiating construction in 2007 and project completion in 2010.
3:2 WATER REUSE
Reuse of the highly treated water produced by the City's Water Reclamation Facility
(WRF) is a drought resistant portion of the City's multi-source water plan. The WRF
produces approximately 4,000 acre-feet of disinfected tertiary treated reclaimed water per
year. This water is suitable for most uses other than drinking and food preparation.
Since most of the recycled water will be used for irrigation, it is estimated that only 1,000
acre-feet will actually be usable in the long-term. This is because demand for irrigation
water is very limited during the winter while discharge from the WRF is fairly constant.
The City does not plan to construct a seasonal storage facility at this time.
The Water Reuse Project will construct a distribution system to deliver reclaimed water
to large volume customers. The system will be designed for future expansion to serve
small volume users, when it becomes economically feasible to do so. The City's
Wastewater Division will operate the WRF and the water reuse pumps and filters located
at the treatment.Plant. The City's Water Division will operate and maintain the water
reuse distribution system.
3.3 WATER DEMAND MANAGEMENT
Water demand management practices and technology have advanced significantly in the
last several -years in reaction to the drought of 1986-1991. Historically, water demand
management was viewed as an emergency response to extreme water shortage situations.
The importance of using our water resources wisely and efficiently is imperative to
assure adequate, reliable water supplies in the future.
In September 1991, the City Council approved-and authorized the.Mayor to sign the
"Memorandum of Understanding_" (MOU) regarding urban water conservation and the
implementation of the "Best Management Practices" (BMP's). This signifies a
commitment to implement and evaluate the water efficiency measures presented in the
MOU. Using the BMP's as a road map for future water demand management program
implementation, abalanced program of providing information and assistance to the City's
water customers is necessary to maintain the water use levels required to add reliability to
the City's water supplies.
3.4 OTHER SUPPLEMENTAL WATER SUPPLY ALTERNATIVES
3.4.1 INCREASED GROUNDWATER PRODUCTION
Prior to the drought of the late 1980's, the City of San Luis Obispo had not used
Attachment.l
groundwater to meet the City's water demand since the early 1940's: In response to the
drought conditions, the City drilled new wells and began using groundwater in April
1989. Beginning in 1992, elevated levels of nitrates in the basin greatly curtailed the use
of groundwater within the City.
A preliminary study was completed by Team Engineering and Management, Inc. to
evaluate the potential for increasing the safe annual yield available to meet City water
demands through the coordinated operation of the groundwater basin in conjunction with
the Salinas and Whale Rock Reservoirs. The preliminary study indicated that an
additional 890 acre feet, above the current assumed 500 acre feet per year, could be
attained through a coordinated operation of all the City's available water sources.
Stetson Engineers were hired by the City to prepare the Phase 1 evaluation of increasing
groundwater production. The "Groundwater Project:-Phase 1 — Evaluation of Project
Alternatives and Potential Impacts" was completed in September 2004. The Phase 1
report provided a preliminary evaluation of the various treatment processes available to
remove the contaminants, an evaluation of potential well sites, a preliminary
environmental evaluation, evaluation of the alternatives.including costs analysis and an
evaluation of possible sites for locating treatment facilities.
The main issue continuing to confront the successful implementation of increased
groundwater production involves potential impacts to stream flows in the area. This
question has been discussed in past reports and has been very difficult to properly
evaluate due to limited historical information. With the recent decision for City
participation in the Nacimiento Project and the cost and uncertainty of the additional
studies necessary to evaluate project impacts, the Council deferred additional phases of
the Groundwater Development Project on December 7, 2004.
3.4.2 SALINAS RESERVOIR EXPANSION PROJECT
The Salinas Dam was constructed by the War Department in 1941 to provide water to
Camp San Luis Obispo and the City of San Luis Obispo. The original construction plans
for the dam included the installation of an operable spillway gate to provide.an estimated
storage capacity of approximately 45,000 acre-feet. A small fault was discovered beneath
the dam during construction..Therefore, the gates were not installed because of stability
concerns.
The Project envisions the installation of the originally planned spillway gates to increase
the storage capacity from 23,843 acre feet to 41,792 acre feet. The additional storage
capacity would result in an estimated increased safe annual yield of 1,650 acre feet per
year. The revised environmental impact report for the project was certified by the City
Council in June of 1998 and the Notice of Determination was filed on November 1.3,
2000.
In June of 2000, updated dam safety evaluation studies were completed by URS
Corporation under contract to the City. The updated studies evaluated the structural
Attachment 1
capacity of the dam, with or without the spillway gates and added water storage, during
seismic and flooding events. Based on the updated analysis, the existing dam was
deemed adequate but installation of the spillway gates (i.e. increasing the maximum lake
level by 19 feet) would require.major structural improvements to the dam. It was
estimated that the strengthening required would cost approximately$10 million (based on
year 2000 dollars). This was on top of the previous estimate for the project of
approximately$20 million.
With the City's participation in.the Nacimiento Project and the significant increase in
project costs, the City Council placed the project on hold and no further work has been
undertaken since 2000 relative to the Salinas Reservoir Expansion Project. Should the
Nacimiento Project not proceed as planned, the City may reactivate the work on the
project to meet the City's water supply needs into the future.
3.4.3 Desalination
In May 1990, the City began a feasibility study for a short-term desalination facility. The
preliminary analysis concluded that 3,000 acre feet per year of water could be provided at
an estimated cost of 19.5 million dollars. The "Miracle March" rains of 1991 provided
adequate runoff and storage in the City's reservoirs to allow the termination of the
desalination project on April 16, 1991.
Desalination may be a water supply consideration in the future if other water supply
projects currently under review are not accomplished. Though considered an expensive
source of water at this time, advances in technology in the future may reduce the costs to
a more acceptable level.
3.4.4 Cloud Seeding
The City activated a three year cloud seeding program in January 1991 in response to the
drought. The program targeted the Salinas and. Lopez reservoirs watersheds, and the
County of San Lois Obispo paid a prorata share of the total cost of the program.
Salinas Reservoir's watershed runoff characteristics are favorable for producing
significant runoff during average rain seasons. Therefore, cloud seeding is not viewed as
an annual program but as a program that the Council may approve following below
normal rainfall years.
3.45.5 Groundwater Recharge
Groundwater recharge using tertiary treated reclaimed water may be a future water
supply alternative. Because of the capacity and recharge capabilities, there may be
limited opportunities for recharging the groundwater basin. The State Department of
Health Services have very stringent regulations governing such non-potable water
recharge projects. An extensive analysis and study evaluating costs, water recharge
potential, and potential storage or injection sites will be required before pursuing such a
project.
Attachment 1
4.0 WATER OPERATIONAL PROGRAMS
POLICY
The City, shall sustain city-wide water efficiency programs and provide an adequate
supply of high quality water which:
• Meets all Federal and State standards;
• Provides uninterrupted water flow at sufficient pressures;
• Provides fire protection.
The City shall allocate funding to meet the goals and objectives presented.in this chapter
(also see Chapter 5). The City should strive to replace aging water lines at the annual rate
of 20/6 of the replacement value of the water distribution system.
4.1 WATER TREATMENT
Over the past twenty years, surface water treatment and groundwater treatment standards
and regulations have become more stringent. With the enactment of the Safe Drinking
Water Act (SDWA) in 1974, Congress authorized the federal government to establish
national drinking water regulations. Since that time, many amendments have been made
to the act which require additional monitoring and treatment and thereby increased
operational costs.
For the City, the most significant issue is the regulation aimed at reducing the formation
of disinfection by-products, specifically trihalomethanes (THM's). To remain within the
acceptable level of THM's, meet anticipated future surface water quality standards, and
increase water treatment operational efficiency, the water treatment facility uses ozone as
the primary disinfectant instead of chlorine. With the use of ozone, THM levels have
been significantly reduced, and meet all federal and state standards.
In November 1992, nitrate levels in the Auto Park Way well exceeded State standards, so
that well was taken off-line. The City's Denny's well experienced a similar increase in
nitrate levels and was taken off-line in June 1993. Increased use of groundwater will
require additional studies and treatment facilities as discussed in more detail in Section
3.6.1.
4.2 WATER DISTRIBUTION
The water distribution program delivers potable water from the water treatment plant and
wells to customers and fire hydrants via three concrete storage reservoirs, nine pump
stations, nine water tanks, and approximately 160 miles of water mains. Some pipes are
over 100 years old, and some are too small to meet current fire-flow requirements. The
City for many years did not fund distribution system replacement sufficiently to ensure
replacement prior to reaching the end of the infrastructure's service life. Because of this,
the current water distribution staff workload is limited mainly to corrective maintenance
with minimal time for preventative maintenance.
The City has adopted a goal of replacing about 2% of the water system annually and has
been budgeting approximately 1 million dollars per year for distribution system
4� -/9
Attachment 1
replacement projects since the mid-1990's. Due to increased construction, costs, the
amount was increased to 1.25 million dollars for 2005 and will increase by $25,000 each
year thereafter.
4.3 WATER CUSTOMER SERVICE
The Water Customer Service Program is responsible for accurately measuring water
delivered through the distribution system to the City's 14,300 customers. Other duties
include the repair of meter, leaks, meter replacement and testing, and the starting and
discontinuance of service. he current program needs are being met with assistance from
the water distribution crew during peak workload periods. Future growth will add a
significant number of water meters which may require additional staffing. As areas are
annexed, an analysis of staffing impacts will be performed and recommendations'
presented to Council. The City is also considering the use of Automated Meter Reading
System (AMR) that could reduce staffing impacts in the future. Recommendations will
be presented to the Council for consideration in 2006.
4.4 TELEMETRY
Telemetry literally means "measuring at a distance". Telemetry became part of the
Utilities' operations in 1988 when the Regional Water Quality Control Board required
installation of alarms on the City wastewater collection lift stations. It has evolved into
complex computer network, monitoring the City's water and wastewater systems. When
completed, the telemetry system will save staff time by allowing the monitoring and
system adjustments to be made from a central location, adds reliability to the water
system, and insures the City is in compliance with federal and state regulations.
4.5 WATER CONSERVATION
In June 1985, the Council adopted the Annual Water Operational Policy which
established a procedure to monitor the City's water supply situation. An integral
component of the policy was the establishment of a water demand program aimed at
instituting preventative measures when water supply deficits are projected.
Water conservation has two primary components; short-term and long-term water
demand management. Short-term activities address immediate water shortage situations
caused by prolonged below normal rainfall or disruption in water service due to natural
disaster such as an earthquake. Due to the drought and water shortages experienced from
1989 to 1992, the short-term measures were developed. Based on the lessons learned
from the drought, an update to the water shortage contingency plan has been completed
and is included in Chapter 6 of this plan.
Long-term programs make permanent reductions in water demand while minimally
impacting customer's life-styles. In September.1991, the City approved and signed the
"Memorandum of Understanding" (MOU) regarding urban water conservation and the
implementation of the "Best Management Practices" (BMP's). The BMP's act as a road
map for the City's long-term water conservation program.
Attachment 1
5.0 FINANCIAL PLAN POLICY
The City's policy ,is to fully recover all water costs which include, operations,
maintenance, capital, debt service, and appropriate overhead, through water revenues.
Resolution No. 6447 states the primary goals of the City's water utility are to provide
quality water service to its citizens and to function as a self-sufficient enterprise. Under
the policy, all water revenues are used. only for water purposes. The water fund will
reimburse the general fund for all indirect costs pursuant to the approved cost allocation
plan.
Water impact fees were .established in 1991 to pay for ' needed facilities and
improvements reasonably related to new development within the City. These fees are
adjusted annually to account for changes in the cost of construction or other
considerations which affect the reasonable relationship between the fees and the cost of
facilities and improvements on which the fees are based.
6.0 WATER SHORTAGE CONTINGENCY PLAN
Based on the experiences during the drought which lasted from 1986 to 1992, the City of
San Luis Obispo recognizes the importance of prudent water planning and the
development of a comprehensive Water Shortage Contingency Plan to deal with future
drought conditions or other interruptions in water supply. In 1991, in accordance with
the requirements of Assembly Bill 11X; the City compiled its existing mandatory water
rationing and water conservation plans into one document and submitted the plan to the
State. The City has been active in water resource planning and water,conservation since
the mid 1980's. In November 1994, the City adopted its Urban Water Management Plan
in accordance with California Water Code 10610 (et seq.) which included the Water
Shortage Contingency Plan. Because of the changed water ethic in the City since the end
of the 1986-1992 drought, the City's Water Shortage Contingency plan reflects the
current water use patterns in the community and provides a methodology to reduce water
use during periods of projected water shortages.
-c,2
Attachment2
RESOLUTION NO. (2005 Series)
A RESOLUTION OF THE COUNCIL OF THE CTTY OF SAN LUIS OBISPO
ADOPTING THE REVISED URBAN WATER MANAGEMENT PLAN
WHEREAS, the California Legislature enacted Assembly Bill 797 during the 1983-1984
Regular Session, and as amended subsequently, which mandates that.every supplier providing
water for municipal purposes to more than 3,000 customers or supplying more than 3,000 acre
feet of water annually, prepare an Urban Water Management Plan; and
WHEREAS, the City is an urban supplier of water providing water to a population_over
40,000;and
WHEREAS, the Plan shall be periodically reviewed at least once every five years, and
that the City shall make any amendments or changes to its plan which are indicated by the
review; and
WHEREAS, the Plan must be adopted, after public review and hearing, and filed with the
California Department of Water Resources within thirty days of adoption; and
WHEREAS, The City has therefore prepared for public review a draft Urban Water
Management Plan, and a properly noticed public hearing regarding the Plan was held by the City
Council on December 6, 2005; and
WHEREAS, the City of San Luis Obispo did prepare and shall file said Plan with the
California Department of Water Resources.
BE IT RESOLVED by the Council of the City of San Luis Obispo that the Urban Water
Management Plan, consisting of text with tables and figures, with changes reflected in the staff
report presented to the Council on December 6, 2005, on file in the City Clerk's Office, is hereby
adopted.
Upon motion of _ - seconded by
and on the following roll call vote:
APES:
NOES:
ABSENT:
the foregoing resolution was adopted this _.- day of 2005.
lc dQ'
Resolution No.. (2005 Series)
Page 2
Mayor David F. Romero
ATTEST:
Audrey Hooper, City Clerk
APPROVED AS TO FORM:
J nathap .Lowell, City Attorney
—oma
RECEIVED
DEC 0 6 2005
C 0 UN C I L MEMO -
CLERK
D FIEE
December 6,2005 MEETING AGENDA
DATE/2-6-05 ITEM # (o
TO: Mayor Romero and City CouncileFPI ((
UNCIL , 2'CDDDIR
VIA: Ken Hampian, City Administrative OfficerAO 2 FIN DIR
John Moss,Utilities DirectorQ� ERO Ci FIRE CHIEF
1111 'ATTORNEY LrPW:DIR
O'CLER,K/ORIG 2 POLICE CHF
FROM: Gary Henderson,Water Division Manager,:A�/ C DEPT HEADS Z AEC DIP
Z'r--bua¢ - 3 LITIL DIR
1? FS Zr HR DIR
SUBJECT: Agenda Item B-6,Urban Water Management Plan Update
At agenda review this morning, Councilmember Mulholland raised a question concerning the
staff report for the Urban Water Management Plan. update. The question was whether the
Council actually eliminated the "reliability reserve" policy. On September 3, 2002 (see attached
report), the City Council did amend the Water Management Element and eliminated the
reliability reserve policy.
I have attached three staff reports for Council's information. The first two provide the
chronology of the reliability reserve elimination. The third report was presented to Council on
March 9, 2004 and modified and added several policies to the Water Management Element that
supported participation in the Nacimiento Project for a total amount of 3,380 acre feet per year.
If there are any questions or additional information needed, please contact Gary Henderson at
extension 237.
council
acEnda izEpoizt ,,..N - ----
CITY OF SAN LUIS O B I S P O
FROM: John Moss, Utilities Director
Prepared By: Gary W. Henderson, Water Division Manager
SUBJECT: WATER SUPPLY RELIABILITY RESERVE
CAO RECOMMENDATION
Consider the modification or elimination of Policy 4.0 of the Water Management Element
relative to the reliability reserve.
REPORT IN BRIEF
The costimplications associated with the policy to develop a 2,000 acre foot (af) reliability
reserve were recently discussed during Council's adoption of revised water impact fees on March
12 and April 2, 2002. In addition, the per capita use (145 gallons per person per day) figure was
also discussed since the figure directly impacts the amount of water that the City needs to
develop to meet General Plan build-out. These two related issues drive the amount of water that
the City needs to develop,.and have potentially significant fiscal and other related impacts:
The reliability reserve was first proposed in 1990, prior to the end of the most significant drought
period experienced by the City during the historical record from 1944 to present. At the time of
Council adoption of the policy, there was no analysis of the value of the reserve (level of
protection provided) or the long-term fiscal impacts. The recent analysis undertaken to answer
these questions revealed the following key points:
1. The estimated cost for developing additional water supply projects has increased by
almost 3 times, which would result in an annual cost of$3.1 million for the 2,000 of
reliability reserve. (Page 3 of the report)
2.. The issues associated with developing one or more water supply projects to provide for
the reserve include environmental impacts as well as fiscal impacts! (Page 3)
3. Since approximately 80% of the reserve would be for existing water customers, it is
estimated that a 21%rate increase (or higher if project costs increase in future) would be
necessary in the future to fund the reserve. (Page 3)
4. The reliability reserve would at best provide 12 months of additional water supply
during drought conditions. To achieve the additional 12 months would also require the
City to use the 2,000 of from the new water supply source each year and "-bank" water
(i.e. reduce amount taken from) in Salinas and Whale Rock Reservoirs. (Page 4)
Council Agenda Report—Water Supply Reliability Reserve
Page 2
5. Other than the 1986=91 drought, there is no other drought period since 1944 that would
have required use of the reliability reserve. (Page 4)
6. The City's adopted Water Shortage Contingency Plan and the difference between actual
water-use and the water use factor of 145 gpcd provide a level of protection for future
Water shortage periods which is roughly equivalent to that provided by the reserve..
(Page 5)
With the significant cost implications, relatively low level of protection and limited number of
times when the reserve would have been necessary, staff recommends that the Council consider
elimination of the policy for developing a 2,000 of reliability reserve. Staff would recommend
maintaining the 145 gpcd planning figure to provide the buffer for water planning purposes. 'The
actual water use has remained well below the 145 figure and has been accomplished by the water
conservation awareness and water efficient hardware retrofits that the community has
accomplished. This buffer has already been achieved by our customers and would not require
any rate increases associated with the reliability reserve, which were noted above.
DISCUSSION
On March 12 and April 2 of 2002, the Council discussed and adopted revised water impact fees
based on the improvements identified in the Water System Master Plan and updated costs
associated with new water supply projects. As discussed at these.Council meetings, two factors
that have a significant impact on the amount of water that the City needs to develop are the
"reliability reserve" and the adopted `water use" figure of 145 gallons per person per day(gpcd).
This report will discuss these two interrelated issues and potential modifications that Council
may consider. Since these policies are included in the Water Management Element of the
General Plan, any modifications will require public hearings before the Planning Commission
prior to hearings before the City Council for adoption.
Reliability Reserve
Why was the reliability reserve originally established? To address the problems associated
with determining safe annual yield and unexpected conditions affecting the safe annual
yield. The idea of establishing a water supply reserve first came forward during the drought
period which began in 1986 and ended in March of 1991. At the Council's request on April 2,
2002, staff researched information from this earlier time period to determine the reasons and
justification for the 2,000 acre foot reserve figure. The first reference to the reserve was
identified in a November 27, 1990 staff report titled "Water Supply Status and Development".
This report covered numerous water supply projects being pursued at the time in light of the
severe drought that the City was experiencing. One paragraph in the report discusses the reserve
(Which Was originally referred to as a"planning reserve") and the full text is shown below'-
"The
elow'"The City has experienced problems with safe annual yield determinations in the past..
Changes may occur in the future due to "live stream" requirements, new Hydrological
data based on the current drought; and changes in water rights law, etc. For these
,y
Council Agenda Report—Water Supply Reliability Reserve
Page 3
reasons, it is prudent to have a planning reserve of additional water supplies to account
for future unexpected conditions. Staff recommends the City develop an additional 25%
increase, or about 2,000 of of its safe annual yield as a planning reserve. "
As far as staff can determine, there was no.technical basis (i.e. it would provide an additional X
years of water supply through the worst drought) for the 2,000 acre foot figure. It should be
noted that this goal was identified prior to the end of the drought. Following the end of the
drought, staff updated the City's safe annual yield computer model to include this new drought
period which resulted in a reduction of the projected safe annual yield that is available through
the coordinated operation of Salinas and Whale Rock Reservoirs: The City's current water
availability is based on this revised safe annual yield analysis and also includes estimated
reductions due to siltation at both reservoirs.
Following numerous public hearings; the City Council adopted the City's Urban Water
Management Plan (UWMP) on November 15, 1994. Policy 2.4 which identified the desire to
develop a reliability reserve is shown below:
"In seeking and accounting for new water supplies, the City will strive for a "reliability
reserve" of 2,000 acre-feet safe annual yield(about 20 percent of projected future water
demand at full build-out). "
At the time that Policy 2.4 was adopted, the Salinas Reservoir Expansion Project costs were
estimated to provide additional water supplies in the range of$500 to $600 per acre foot. These
costs are approximately one-third the current cost estimates for additional water from the
Nacimiento Project. The cost for the 2,000 of reliability reserve has increased from $1 million
per year to $3.1 million.
What issues have changed since the policy for a reserve was originally envisioned by the City
Council? The City has revised (lowered) the safe annual yield estimates for Salinas and
Whale Rock Reservoirs based on the 1986-91 drought period. In addition, the estimated
cost for additional water supply projects has nearly tripled (and may be higher in the
future). The policy for the reserve was made without an analysis of the value of the reserve
(level of protection .provided) or the cost impacts (currently projected at $3.1 million per
year for the reserve).
What are the implications associated with developing .the reliability reserve? The issues
include environmental considerations, multiple projects being pursued, and fiscal impacts.
The 2,000 acre foot reliability reserve represents approximately 53% of the additional water
supplies currently being pursued to meet the policy and build-out water demands of the City.
The development of additional water supplies, depending on the source, will have some level of
environmental impact associated with the project. With the large amount of additional water
supplies currently being pursued, multiple projects may be necessary to develop the projected
amounts. In addition, as discussed in detail at the March 12, 2002 Council meeting, the
reliability reserve will have significant cost implications to both existing water customers as well
I
Council Agenda Report—Water Supply Reliability Reserve
Page 4
as new development. Since approximately 80% of the reserve is to serve existing customers, it is
currently estimated that a rate increase of approximately 21% would be necessary to pay for
existing customers portion of the reliability reserve. The other 20%of the costs for the reliability
reserve are included in the revised water impact fees for new development which were adopted
on April 2, 2002 (new fees take affect on July 1; 2002). If the Council chooses to reduce or
eliminate the reliability reserve, the projected 21% water rate increase for existing customers
would be reduced or eliminated. In addition, the water impact fees for new development would
be reduced slightly associated with the elimination of their share(20%) of the reliability reserve.
What level of protection does the 2,000 acre foot reliability reserve provide to the community if it
were obtained? The reserve could provide up to an additional 12 months of water supply
during water shortage period as discussed in more detail below.
The level of protection that the reliability reserve would provide has.never been clearly analyzed
or evaluated. Opinions throughout the community relative to what the reserve should provide
would likely range from "it would never require the community to enter mandatory rationing
again"to"it will provide a buffer for a non-rainy day".
In an attempt to answer this question, staff used the computer model that was developed to
analyze the safe annual yield available from Salinas and Whale Rock Reservoirs to run various
scenarios if the 2,000 acre foot (af) supply had been available to the City for the past 56 years.
The computer model uses historical data from 1944 to 2000 and various assumptions to estimate
what level of protection the reserve could have provided over this time period.
The analysis revealed that if 2,000 acre foot had been available_ each year during the recent
drought (1986-91) and assuming the City demand was equal to the current safe annual yield from
the two lakes, the City would have approximately 10 to 12 months of additional water supplies at
the end of the critical drought period. Attachment 1 and 2 graphically show the model
projections of water supplies in the reservoirs with and without the reserve(Scenario 1 is without
use of reserve). Thus assumes that the 2,000 of would be used every year during the drought
period. Since no one can be sure when the beginning of the next critical drought would occur,
the City would need to utilize the 2,000 of every year (under this scenario) which reduces the
amount that is taken from Whale Rock and Salinas Reservoirs. This essentially "banks" some
water in the two existing lakes.
Staff also analyzed other Table 1: Reliability Reserve Levels of Protection
scenarios to determine the
level of protection Reserve Used During Extension of Available Water Supplies
provided if the 2,000 acre Last 3.Years_. 6-7 months
foot reserve were used Last 2 Years 5-6 months
during the last 3 years of Last Year 4-5 months
the drought, 2 years of the
drought, etc. as shown in
Table 1.
Council Agenda Report.—Water Supply Reliability Reserve
Page 5__
Would the City have needed to use the reserve other than during the 1986-91 drought? The
short answer is,NO. Staff simulated using the 2,000 of in the computer model only during the
controlling drought period from 1986 through March of 1991. The analysis indicates that at the
end of this drought period, the City would have had approximately 7,500 of in Whale Rock
Reservoir(approximately 10-12 months supply). Since the computer model goes back to 1944,
the results were evaluated to determine whether there was another drought period when there
would have been less than 7,500 of without the use of the 2,000 af.. The results indicate that there
would have been one other drought period that approached this amount without the use of the
reserve. This indicates that the drought period of 1986-91 was a very significant, critical drought
period surpassing any other drought period during the last 56 years as it affects the City's water
supply sources. In summary, the analysis would indicate that the City would not have needed to
use the reliability reserve for any period except the controlling drought in the last 56 years. At
today's estimated cost, this equates to an annual $3.1 million insurance policy that may be
needed infrequently and only buys an additional year's worth of water, at best.
If the reserve is reduced or eliminated, what other measures are available which can provide
protection to the City in future droughts? The City's adopted_Water Shortage Contingency
Plan and the difference between the actual water use and the 145 gpcd planning figure.
The adopted Water Shortage Contingency Plan was.not included in the analysis of the scenarios
discussed above. The Water Shortage Contingency Plan has three action levels that are triggered
when water supplies are projected to last 3 years or less. Implementation and achievement of the
identified water reductions during these events will extend available supplies from 9 to 12
months, depending on the City's water demand in the future.
More importantly, the second safety factor(discussed in more detail in the following sections of
this report) is the difference between the water use factor used for planning purposes of 145 gpcd .
versus the actual water use. The goal.is to continue to keep the overall community per capita use
rate well below the 145 figure. If the figure over the long-term can be maintained around 125 to
130 gpcd, this would represent a buffer of approximately 10 to 15%.
An additional area for consideration which may provide a certain level of protection would be
working with other agencies in the County to develop "mutual aid" type agreements to share
water resources during emergency periods. Cooperative use of the City of Morro Bay's
desalination facility(or expanded facility)could be an example of one such alternative.
If the Council decided to eliminate the reliability.reserve, would the City Charter need to be
amended? The short answer is; Yes, for consistency purposes but not to adopt the change
in policy. In the November 1996 election, Measure P was placed on the ballot relative to the
reliability reserve. The voters approved the Charter amendment which added Section 909 as
shown below:
"As identified in the Water Management Element of the General Plan, the City shall
strive to acquire additional water supplies as a "reliability reserve" to protect the City
Council Agenda Report Water Supply Reliability Reserve
Page 6
from future water shortages. Once the City has acquired a portion or all of the reliability
reserve, the additional water supply shall only be used to meet City needs during
unpredictable changes such as a new worst case drought, loss of one of the City's
sources, contamination of a source, or failure of a new source to provide projected yield,
and not to allow additional development. "
The language above notes that the Water Management Element (WME) policy indicates that the
City shall strive to acquire a reliability reserve. This does not mandate that the City develop the
reserve, or how the City develops or achieves the equivalence of the reserve, but the reason the
City Council placed the language on the ballot was to insure that if additional supplies were
developed, it would not be used in the future for additional growth; The concern was that a
future Council, on a 3 to 2 vote, could change the policy. If the Council decides to eliminate the
reliability reserve policy, a Charter amendment should be undertaken to delete Section.909. Staff
does not believe that a Charter amendment is required for the Council to eliminate the reserve
policy in the WME but rather, to ensure consistency between the WME of the General Plan and
the City Charter.
145 gpcd Water Use Figure
The `water use" figure adopted in the WME received significant discussion during the
development of the UWMP. Graph 1 shows the historic per capita water use since 1985. The
drastic reduction in the per capita water use during the drought was achieved through public
education and awareness, monetary penalties and related measures. Following the drought, it
was acknowledged that these extremely low rates could not be maintained over the long-term and
that there is a certain level of water needed to provide a reasonable quality of life for residents,
which includes water for landscaping and gardens. It was also acknowledged that conservation is
likely the least expensive source of additional water_ when compared to developing new water
supply sources,which it has proven to be.
While per capita use increased following the end of the drought up. to 1997, the use appears to
have stabilized over the past several years. A number of factors can impact the per capita use
rate including, timing of yearly rainfall and the amount, population figure estimates from the
State which can fluctuate, and retrofitting that has been an ongoing requirement for new
development since 1989. It should be acknowledged that new development has been required to
retrofit to not only offset their expected use but at twice the estimated use (i.e. 2 to 1). The
mandatory retrofit requirement was eliminated as of January 1, 2002 based on the fact that the
majority of existing toilets have been retrofit. Using information from 1995 through 2001, staff
estimates that retrofitting existing facilities served by the City saves approximately 550 of per
year. If these retrofits had not been completed, the per capita use rate for 2001 would increase
from the 118 gpcd figure shown above to 129 gpcd. With the elimination of the retrofit
requirement, the overall per capita use figure may tend to increase as new development occurs.
Maintaining per capita use rates in the 130 gpcd range may be achievable but additional time is
be needed to insure use will remain at these lower levels.
Council Agenda Report—Water Supply Reliability Reserve
Page 7
There have been discussions of lowering the `water use" figure below the 145 level. Adopting a
lower per capita use figure, based on other policies in the WME, would immediately create
additional water for new development. If the figure were lowered to 140 gpcd,there would be an
additional 250 of available for new development at this time.
As noted earlier, maintaining the current 145 gpcd figure provides a buffer between actual use
and the planning figure of approximately 10-15%. Staff recommends maintaining the planning
per capita use rate at the current 145 gpcd as a buffer until such time as supply project options,
feasibility, and costs are evaluated and reviewed by Council in light of eliminating the reserve
requirement.
Summary
Based on the above discussions and the information presented in the March 12, 2002 Council
report relative to the cost implications associated with developing a reliability reserve and the
level of protection provided by the reserve, Council is being asked to reconsider the policy for
developing the reliability reserve. If the reserve is eliminated, staff would recommend that the
"water use" figure remain at 145 gpcd. The elimination of the reliability reserve will negate the
need for a rate increase for existing customers associated with the reserve.. The difference
between the actual use rate and the 145 figure, that has been achieved through increased
conservation, would serve as the buffer.. The water that has been conserved by the community
would serve as part of the insurance policy without any additional costs or rate increases.
In addition, the adopted Water Shortage Contingency Plan will be implemented when supplies
are estimated to last 3 years or less which will extend available water supplies. If Council wishes
to revise the policies as noted above, the issues would be referred to the Planning Commission
and the brought back to the City Council for adoption as a revision to the Water Management
Element of the General Plan.
The modification or elimination of the reliability reserve will have a dramatic impact on the
amount of water that the City will need to develop from new sources of supply. Following
Council direction tonight; staff will return with- thorough discussion of the water supply
projects that should be pursued as part of the 2002 Water Resources Status Report on June 11,
2002.
FISCAL IMPACT
Depending on the modifications made to the policies discussed above, there could be long range
cost impacts (increases or reductions) to both water rates and development impact fees. No
impacts are associated with this staff report since no formal action can be taken to modify the
policies without the full General Plan process.
f i
Council Agenda Report—Water-Supply Reliability Reserve
Page 8_
ALTERNATIVES
1 Modify the 145 Water Use Figure and Maintain the 2,000 of Reliability Reserve.
Reducing the water use figure to 1.40 gpcd, for example, would immediately provide
approximately 250 of for new development based on existing Water Management Element
policies. This option would utilize part of the buffer already developed through conservation
measures and necessitate development of additional water supplies to provide a reserve. This
additional reserve (speculative) would require future water rate increases. With the
significant annual cost associated with the reliability reserve, the relatively low level of
"-`insurance" protection, and the projected rate increases for existing residents to fund this
protection level, staff would not recommend this alternative.
2. Do not modify either of the policies. This will require the City to continue to pursue an
additional 2,000 of of water supplies to provide for.the reliability reserve. Assuming the
reserve is acquired from the Nacimiento Project at an estimated cost.of$1,550 per af, this
Will result.in an annual cost to the City of$3.1 million. Based on the level of protection
provided by a 2,000 of reliability reserve, staff does not recommend this alternative..
3. Reduce the amount of the reliability reserve. The level of protection provided by a 2,000
of reliability reserve:is relatively low. Any reduction in the amount of the reserve will only
reduce the level of protection provide. Staff does not recommend this alternative:
ATTACHMENTS
1. Graph of projected water supplies during drought period without reliability reserve.
2. Graph of projected water supplies during drought period with reliability reserve.
3. Ballot Measure and analysis relative to the reliability reserve(November 1996)
Council Reading Filer
1. "Water Supply Status and Development" Council Agenda Report dated November 27,
1990.
2. Minutes from November 27; 1990 City Council meeting.
council °4R-
q- 3 -oz
j acEnaa Report " b.
CITY O F SAN Luis OBISPO
FROM: John Moss,Utilities Director
Prepared By Gary W. Henderson; Water Division Manager
SUBJECT: AMENDING THE GENERAL PLAN WATER AND WASTEWATER
MANAGEMENT ELEMENT POLICIES
CAO RECOMMENDATION
As recommended by the Planning Commission, adopt a resolution approving a negative declaration
of environmental impact and amending the Water Management Element relative to the reliability
reserves supplying new development and accounting for.reclaimed water.
DISCUSSION
Background
On July 12, 2001, the City Councildiscussedpotential changes to the policies contained in the
Water Management Element to the General Plan. The four policies that were discussed in detail are
listed below:
4:1.1 Reliability Reserve
8.L2. Supplying New Development
8.1.3 Reserve for Intensification and Infill Development
8.1.4 Accounting for Reclaimed Water
Following Council discussion, the Council directed staff to initiate the General Plan amendment
process which required hearings before the Planning Commission. With the exception of the
reliability reserve, the Council was interested in modifying certain aspects of each of the policy
areas listed above. In particular; the City Council requested the Planning Commission's input and
recommendation for potential modifications to the policy concerning reserve of water for
intensification and infill projects.
During Council discussions relative to increases in water impact fees on March 12, 2002, the
Council requested staff to prepare a more detailed evaluation of the benefits and costs associated
with developing a water supply`reliability reserve": On May 14, 2002, staff presented an analysis
of the issues raised by Council and outlined the potential benefits and costs associated with the
reliability reserve policy. Based on the analysis, the Council directed staff to initiate an amendment
to eliminate the policy for"striving to acquire a 2,000 acre foot reliability reserve".
The Planning Commission has held two separate meetings relative to the policies outlined above on
February 27, 2002 and July 10; 2002. The four policy areas listed above are discussed in the
following sections which reflect the Planning Commission's recommended policy changes. Exhibit
Council Agenda Report—Water Management Element Policy Changes
Page 2
A to Attachment 1 provides a legislative draft of the recommended modifications to the Water
Management Element policies.
4.1.1 Reliability Reserve
The Planning Commission considered the elimination of the policy, which establishes a goal to
obtain an additional 2,000 acre feet of water for a reliability reserve. The analysis of the benefits
provided by a 2,000 acre foot reliability reserve indicated that it would provide an additional 10 to
12 months of water supply at best during an extended drought. With the current estimated cost of
water from potential supply projects, the reserve is estimated to cost $3.1 million per year. Based
on the limited benefits and high costs,the Planning Commission recommends that the City Council
consider elimination of Policy 4.1.1 Reliability Reserve from the Water Management Element.
With the proposed elimination of the reliability reserve, references to the reserve in Section 6.0 of
the Water Management Element (WME) would also be deleted. In addition, Table 6 and 7 in the
WME have been updated to reflect population estimates for 2002 (Exhibit A, Attachment 1) and
related figures.
8.1.2 Supplying New Development
Section B requires minor modification to reflect a previous amendment to the WME relative to how
the City accounts for siltation at the reservoirs as well as the recommendation for elimination of the
reliability reserve. Several years ago the City modified Policy 1.0 Safe Annual Yield to account for
siltation losses as they occur and incorporate the estimated annual losses into the adopted safe
annual yield figures. Based on these changes,the changes shown below are necessary:
B. Any safe annual yield from new water supply projects beyond that needed to balance
safe annual yield and present demand will be allocated -Me-
to
development, subject to the requirements in Policy 8.1.3, "Reserve for Intensification
and Infill."
In January of 2002, the City Council eliminated the requirement that new development projects
retrofit existing toiletsas a condition of development. Approximately 80% of the toilets within the
City have been retrofit and it was becoming increasingly difficult to locate willing property owners
to allow retrofit of their existing toilets. Based on this information, Council made a determination
that essentially all toilets within the City had been retrofit and eliminated the mandatory retrofit
requirement. Based on these changes, the Planning Commission recommends the revised policy
language shown below, which will still allow developers, on a voluntary basis, to retrofit facilities
to eliminate the need for a water allocation.
C
U,.,.,,,rh ,.a a-.0 in Me r':.,, are . i , a with ei ,--flew "k;; _a , u,,,..,r-he, a
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Council Agenda Report=Water Management Element Policy Changes
Page 3
. A water allocation shall not be required for projects for which
the developer makes changes, in facilities served by the City, which will reduce long-term
water_usage equal to twice the water allocation required for theprcject
8,1.3 Reserve for Intensification and Infill
The existing policy relative to the reserve for intensification and infill projects within the July
1994 city limits is shown below:
"Yhe City will annually update the water available for allocation based on the difference
between the adopted safe annual yield (policy 1.1.2) and the present water demand (policy
3.1.4) as part of the annual Water Resources Status Report. One-half of the water available
for allocation (not to exceed the total requiredfor infill and intensification), as identified in
the Water Resources Status .Report, will be reserved to serve intensification and infill
development within. existing city limits as of July 1994."
The City Council requested the Planning Commission's recommendation relative to potential
modification of this policy. This policy was discussed in detail at both the February 27, 2002 and
July 10, 2002 meetings. The Planning Commission struggled with the issue due to competing_
policies,which are included in the City's General Plan.
Based on the discussions at the two Planning Commission meetings (Attachment 2 and 3 are
minutes from the meetings), it is evident that a number of the Commissioner's are concerned that
new annexation areas could"potentially use the available water thus restricting availability for infill
projects. The existing policy recalculates the 50-50 split each year..
The main competing goals in the General Plan involve the goal to encourage infill and
intensification within the 1994 City limits and the goal for increasing housing stock, particularly
low income, within the City. Most of the additional housing will likely be built in the new
annexation areas.
The Planning.Commission considered establishing a fixed amount of water to be reserved for infill
and intensification development and not recalculate the figure on an annual basis. Following
numerous discussions on the issue, the Planning Commission recommended that the existing policy
remain unchanged at this time. The Commission requested that staff annually present the Water
Resources Status Report (WRSR) to the Commission for their consideration of water supply
availability. The Commssion also requested that the WRSR include a discussion or table indicating
how much water is needed to meet the infill and intensification projects within the 1994 city limits
which should also reflect changes to land uses that occur over time. By annually reviewing the
water supply situation, the Commission could reconsider the policy recommendation in the future,
if warranted.
Council Agenda Report—Water Management Element Policy Changes
Page 4
8.L4 Accounting for Reclaimed Water
The policy for accounting for reclaimed water was recommended for modification to add only the
additional amount of water to the City's safe annual yield that will actually be used. While the
Water Reuse Project is estimated to be capable of providing up to 1,200 acre feet per year, the
project will likely only deliver approximately 130 acre feet immediately following completion of
construction. The Planning Commission recommends the policy be modified as shown below:
Redaimed water wig be added to -the mft annual �� eeraistent %4th pe"es
Reclaimed water has an estimated potential of 1,200 acre feet per year of water dvailable for
appropriate non potable uses. The amount to be added to the.City's safe annual yield, and
therefore available for development, will only be the amount projected actually to be used or
offset (approximately 130 af initially); increasing to 1;200 acre feet per year as additional
offsetting uses are brought on-line. The amount of reclaimed water used each year will be
reported to Council as part of the annual Water Resources Status Report and will be added
to the safe annual yield identified in Section 1, Table I of this document to determine water,
available for new development.
Summary
The recommended policy changes presented in this report have been the subject of several public
hearings before the Planning Commission as well as the City Council. The adoption of the attached
resolution. and associated changes to the Water Management Element of the General Plan will
implement the recommendations of the Planning Commission.
CONCURRENCES
1. Staff and the Planning Commission recommend approval of the negative declaration. No
comments were received on the negative declaration.
2. The Planning Commission concurs with the recommended policy changes as shown in
Exhibit A to Attachment 1.
FISCAL IMPACT
There are no fiscal impacts associated with the recommended policy changes. .
Attachments:
1. Resolution Adopting Water Management Element Policy Changes
2. Initial environmental study
3. Planning Commission Meeting Minutes of February 27, 2002
4. Draft Planning Commission Meeting Minutes of July 10, 2002