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HomeMy WebLinkAbout11/17/1992, 5 - STATE WATER PROJECT - WHALE ROCK EXCHANGE lll'ullyuhllnlln�'I�Iunll 4 MEETING OATS C�v� Q allWll IIII'I Iul'ull San '.IS OBISpO November 17, 1992 COUNCIL AGENDA REPORT MM NUMBER: FROM: John Moss PREPARED BY: Gary W. Henderson G--�to Acting U ' ties Director Water Division Manager SUBJECT: State Water Project - Whale Rock Exchange CAO RECOMMENDATION: Receive Report from County Staff and Provide Direction to Staff Concerning the Exchange of State Water for Whale Rock Water. DISCUSSION: On July 7, 1992, the City Council approved the concept of exchanging State Water for Whale Rock water with the three Cayucos water purveyors (see staff report Attachment B). The Council action at that time was based on the assumption that the City would be a participant in the State Water Project. On November 3, 1992, the residents of the City passed Measure H which overturned the City's decision to participate in the State Water Project. The Cayucos Water Agencies request that the City reconsider the exchange idea and direct City staff to continue negotiations on an agreement to allow the exchange. The idea of an exchange was presented in the environmental impact report prepared for the local facilities portion of the State Water Project. The exchange was identified as the preferred alternative, from an environmental standpoint, to the construction of the Chorro Valley pipeline. City staff's evaluation of exchanging Whale Rock water with all agencies served through the Chorro Valley pipeline indicated that the City could only serve the Cayucos area and Cuesta College without severely impacting the City's safe annual yield from Whale Rock. Therefore, the Chorro Valley pipeline will be built to serve Morro Bay, California Men's Colony, County Operations, and Cuesta College. Without an exchange, the Cayucos water agencies would have to build minimum of 4 miles of additional pipelines to supply State Water to the area. The construction of such a pipeline is considered cost prohibitive by the agencies. If an exchange is not accomplished, the Cayuos agencies will most likely not participate in the State Water Project and will not be able to meet the future projected water supply demands in their area. Possible Concerns The residents of San Luis Obispo have rejected the State Water Project for a number of reasons including environmental impacts to the Delta and water quality concerns. If the City participated in the exchange these issues would still be present although to a lesser degree (ie. 200 of verses 3,000 af). There may be strong opposition by the public to participation in the State Water Project in any form based on these concerns. Possible Benefits The main benefit that County staff has identified is the City would be tied. into the State Water Project and could receive water in emergency situations. The idea is that if the City were in an extreme water supply shortage, there could be the possibility that emergency water could be delivered to the City from the State Water system. During the recent drought, an emergency water bank was established which allowed agencies who receive state water to purchase additional amounts from this supply. ������►���►�iIN11111i �IIIIIU city of San L - o61Spo EM COUNCIL AGENDA REPORT State Water - Whale Rock Exchange Page 2 Summary Staff requests that the Council consider the information presented by the County at tonight's meeting and provide direction to staff concerning continuing negotiations on the agreement for the State Water-Whale Rock exchange. Attachments: A. Letter from County concerning exchange B. July 7, 1992 staff report concerning exchange '. COURTY Attacnment A Sfl0 LUIS 0B1 � 10 DEPARTMENGII NT COUNTY GOVERNMENT CENTER • ROOM 207 • SAN LUIS OBISPO, CALIFORNIA 93408 NTON MILNE PHONE (805) 781-5252 • FAX (805) 781-1229 JUNTY ENGINEER GLEN L PRIDDY DEPUTY COUNTY ENGINEER ENGINEERING SERVICES 4 NOEL KING ROADS DEPUTY COUNTY ENGINEER ADMINISTRATION TRANSIT FLOOD CONTROL WATER CONSERVATION COUNTY SURVEYOR November 5, 1992 SPECIAL DISTRICTS Council Members City of San Luis Obispo 990 Palm St. San Luis Obispo, CA 93401 Subject: Water Exchange Agreement Between the County's Waterworks District No. 8 (Cayucos) and the City of San Luis Obispo, Agency Member of the Whale Rock Commission, Reconsideration, San Luis Obispo City Council Meeting of November 17, 1992 Dear Honorable Council Members: The Water Agreement between the San Luis Obispo County Flood Control and Water Conservation District and San Luis Obispo County Waterworks District No. 8, Cayucos, involving contract obligations for delivery of State Project water, identifies the most economical manner for Cayucos to make additional water available to its customers is by means of an exchange of water with a member agency of the Whale Rock Commission. San Luis Obispo County Waterworks District No. 8 wishes to finalize an exchange agreement with the City of San Luis Obispo and requests that the City reconsider and affirm its position on the matter of an exchange agreement. We are prepared, based on our discussions and negotiations with the staff of your Utility Department, to final our draft exchange agreement for Council and District acceptance, approval and execution. In consideration of your earlier direction to staff, Waterworks District No. 8, along with representatives of the two other water purveyors within the Cayucos area, Morro Rock Mutual Water Company and Paso Robles Beach Water Association, have been working with the City's Utility Department staff in preparing a draft exchange agreement which meets the legal, regulatory and operational concerns of all agencies involved. We believe, that even in light of the City's current vote for non-participation in the Coastal Branch portion of the State Water Project, there are operational and economic benefits to be received by the parties involved in this agreement. For Waterworks District No. 8 and the other Cayucos purveyors, the matter is foremost economic, while at the same time providing operational diversity. For the Whale Rock Commission, and specifically the City of San �-3 Luis Obispo, operational diversity and enhanced contingency planning is gained through the direct connection to a statewide water supply infrastructure; while financial risk and responsibility, and source reliability are secured by agreement criteria addressing exchange details. It is our hope that the Council will agree that the benefits to both agencies will provide the incentive for reconsideration and direction to staff to continue the process to formalize the agreement for agency execution. Staff members representing Waterworks District No. 8 and representatives of Morro Rock Mutual Water Company and Paso Robles Beach Water Association of Cayucos will be in attendance at your Council meeting to address your questions and concerns of this request. Any specific questions or comments you may have prior to the scheduled meeting may be addressed to me at the above number. We sincerely hope that for the mutual benefit of our agencies that we are successful in completing these negotiations for the benefit of the customers that we serve. Sincerely, GLEN PRIDDY Deputy County Engineer Waterworks District No. 8 cc: Chairman Laurenc L. Laurent, District 2 Paso Robles Beach Water Association Morro Rock Mutual Water Company lgg\city.ltr.ds Attachment B MEETING DATE: j► City o� san Luis oBispo Jul 7. 1992 ITEM NUM HOZ9COUNCIL AGENDA REPORT GBER FROM 'UPJI: William T. Hetland � PREPARED BY: Gary W. Henderson _ �1 Utilities Director Water Division Manager SUBJECT: State Water Project - Whale Rock Exchange CAO RECOMMENDATION. Direct Staff to Proceed with Alternative 3 or 4 and negotiate Agreements with Involved Agencies and Return to Council for Final Approval. BACKGROUND: The City Council approved the City's participation in the State Water Project on April 21, 1992. Following this decision, a number of agencies have requested that the City of San Luis Obispo exchange water from Whale Rock Reservoir for State Water which would eliminate the need to build all or a portion of the Chorro Valley pipeline. The idea of an exchange was presented in the environmental impact report prepared for the local facilities portion of the State Water Project. The exchange was identified as the preferred alternative, from an environmental standpoint, to the construction of the Cborro Valley pipeline. The Chorro Valley pipeline would begin at the Cuesta Tunnel (which was constructed to convey water from Salinas Reservoir) and proceed up the valley parallel to the Whale Rock pipeline to Morro Bay and then proceed on to Cayucos (see Attachment 1 for map of the Chorro Valley pipeline). PURPOSE The purpose of this report is to assess the impact of the exchange on the City's water supply resources and identify other areas of concerns which the Council needs to be aware of prior to making a policy decision on the exchange. If the City of San Luis Obispo does not participate in the State Water project, it is Table I: Requested Exchange Amounts assumed that no exchange would be possible. City of Morro Bay 1,313 of The agencies that are interested in an County Water Works District #8 80 of exchange and the amounts of water Morro Rock Mutual Water Co. 61 of requested are shown in Table 1. If all the Paso Robles Beach Water Assoc. 40 of agencies were included in the exchange, the Festa College 200 of total amount would be 2,119 acre-feet per County Operations 425 of year (afy). This large amount of yearly exchange from Whale Rock Reservoir would TOTAL 2,119 of have a significant impact on the City's safe annual yield estimate. "VA city o� san Luis OBisp0 COUNCIL AGENDA REPORT. State-M'ater Project -1N1ale Rock Exchange Page 2- PROCEDURE The City of San Luis Obispo has adopted a multi-water resource supply policy. A computer model was developed based on the coordinated operation of the two reservoirs and recent hydrologic information. Based on this ana]ysis, City Council recently adopted a revised combined safe annual yield of 7,735 afy (assuming 500 afy of groundwater). This computer model was utilized to determine the impact of exchanging Whale Rock water for an equal amount of State Water. The computer in, is based on a number of assumptions which have a direct impact on the ability of the City of San Luis Obispo to participate in an exchange of water. The model assumes that groundwater (500 &&) and state water are used first, then Salinas Reservoir is used next to meet the City's water demand. Whale Rock water is the Iast to be used and is primarily held in storage as a backup reserve. The analysis also assumes that each year a minimum of 1,000 of is used from Whale Rock due to water quality problems at Salinas Reservoir (ie. algae.blooms, sediment washed in during storms, etc.). This is an important assumption and has a direct impact on the amount of water that the City can exchange with other agencies. Except for the above amount withdrawn from Whale Rock, Whale Rock is only used wben Salinas reaches minimum pool. By managing the water supply in this manner, the City increases the overall held from the reservoirs. Based on the above assumptions, staff analyzed the impact of an exchange on the City's safe annual yield estimates. Figure 1 shows the impact on the City's yield with varying exchange ". amounts. The figure indicates that exchanging Whale Rock water for State Water can have a significant impact on the - — - — City's safe annual yield. This reduction in yield is due to Whale Rock being used by the d exchange agencies and not being available as WD- a City backup to Salinas Reservoir. It basically eliminates the City's advantage of coordinated use of the two reservoirs. . 3 3 RESULT'S DD- Attempting to withdraw 2,119 afy in addition ' to the 1,000 afy which is already assumed, , .o, 80 soo ,,,o „o, exceeds the City's safe annual ;Meld from. EXCAMCBEAMM" (A-F.Ya Whale Rock Reservoir. Therefore, the City would be unable to meet the full requested Figure 1: Impacts of Exchange Amounts exchange amount It was then determined, based on hydrologic data from September 1943 to December 1991, that the maximum exchange amount, in addition to the 1,000 afy, that could be withdrawn from Whale Rock would be 1,145 � ►IV1�I �j city of san Luis mspo COUNCIL AGENDA REPORT State-�'_4'ater Project - Whale Rock Exchange Page 3 afy. The major problem with exchanging this amount of water is that the critical time period controlling the computer analysis is the end of the data in the program (ie. December 1991). Therefore, the critical time period has not ended and since Whale Rock Reservoir did not see a significant increase in storage this year, the amount calculated as a maximum (ie. 1,145 afy) is questionable. If this amount was exchanged on an annual basis, there would be a reduction of 880 afy in the City's yield. This indicates that the City would lose the majority of the increased yield attributable to the coordinated operation of the two reservoirs. In order for the City to avoid being negatively impacted, it is assumed that any decrease in the City's safe annual yield would need to be offset by an equal amount of state water above the Whale Rock exchange amount. Therefore, the City would not support a one for one exchange for state water. It is obvious from the above discussion, that the City cannot protide all of the requested exchange amounts. The amount requested by the City of Morro Bay is approximately 62% of the total requested and as such has a drastic impact on the possibility of an exchange. With the reduction in City yield shown in Figure 1, an exchange with Morro Bay would not appear to be in the City of San Luis Obispo or Morro Bay's best interest because of the large exchange amount results in a significant reduction in safe annual yield. In other words, if the City of San Luis Obispo were to exchange water with only Morro Bay, who has a maximum requested allotment of 1,313 afy, the City would only exchange approximately 800 afy (see Fig. 1 - 800 exchange + 550.reduction = 1,350) of water from Whale Rock Reservoir in order to offset the amount of safe annual yield lost due to the exchange. CMC/CAL POLY EXCHANGE The California Men's Colony has requested an exchange of 400 afy of state water for an equal amount of Whale Rock water with Cal Poly. Cal Poly will not have a physical connection to the State Water Project, the exchange would require an agreement with the City to accept the. state water into our system and provide water to Cal Poly through their existing connections to our,system. The exchange which the California Men's Colony is negotiating with Cal Poly will have a minimal impact on the City of San Luis Obispo. The impact is significantly less than an exchange of the City's Whale Rock water because the City can deliver water from any of our sources to Cal Poly (ie. the reservoirs can still be operated in a coordinated fashion). The impact on the City's safe annual yield due to an exchange between CMC and Cal Poly, is a result of state water being delivered at a constant rate throughout the year but Cal Poly's water demand fluctuating during the period. Fifteen (15) acre-feet per year is loss through evaporation due to water left in storage resulting from the variation in Cal Poly's demand. This means that if CMC wishes to exchange 400 afy of Whale Rock water they Aill need to provide 400 afy to Cal Poly and 15 afy to the City of San Luis Obispo. This item will have to be addressed in negotiations with CMC and Cal Poly. ,11110 'is city of San Luis OBISp0 COUNCIL AGENDA REPORT State Water Project - Whale Rock Exchange Page 4 OTHER CONCERNS Since State Water is delivered at a constant rate to participating agencies, it is questionable if the City of San Luis Obispo can currently use more than the 3,000 afy. This is due to the fact that currently the City is using approximately 5,000 afy but the daily demand fluctuates throughout the year. There are currently days during the year that the demand may not equal the constant delivery rate of state water if the City agrees to exchange a large amount of Whale Rock water. The demand is expected to increase following the end of mandatory rationing but may require the City to cut back requested state water deliveries in the interim. This may cause an increase in the unit cost of state water which would need to be recovered from the, agencies involved in the exchange. The City's current water right permit for Whale Rock Reservoir defines the service area as the City of San Luis Obispo and Cuesta College. An exchange with any other agencies will require an application for change of service area to, be filed with the State Water Resources Control Board. This change of service area will require CEQA review and State Board approval. There are a number of other technical issues which will have to be addressed in the agreements between the City and the agencies if such an exchange were to take place. The agreements will have to be carefully prepared to insure that the City is protected under present and future conditions (ie. the City's water supply resources are not adversely impacted). These agreements would be brought back to Council for their approval. ALTERNATIVES A number of alternatives are listed below for consideration. The impacts of each alternative are shown in Table 2. a Alternative 1: Exchange the maximum amount of 1,145 afy distributed proportionally among all requesting agencies. To offset the reduction in the City's safe annual yield, the agencies would have to provide the City with 2,025 afy of State water. The agencies would only receive 54% of the requested amount of state water but would still be required to purchase 96% of the state water which they have requested. A major problem with this alternative is that the City could not currently utilize 5,025 afy (3,000 + 2,025) at a constant rate. This amount of water exceeds our daily demand for most of the year. This alternative is not recommended Alternative 2: Agree to exchange water with all the agencies, except Morro Bay. The total exchange amount would be 806 afy which would need to be offset with approximately 1,355 afy of state water. The agencies would either have to increase their allocation request or reduce the amount of water requested to be exchanged from Whale Rock Each agency would receive approximately 60% of the state water exchanged with the City. S h p city o� san Luis OBISPO COUNCIL AGENDA REPORT St2te-V412ter Project - Rfiale Rock Exchange. Page 5 Alternative 3: Agree to exchange water with only Cuesta College and the Cayucos Water agencies (ie. County Waterworks District 7-8, Morro Rock Mutual Water Co. and Paso Robles Beach Water Assoc.). If you assume that Morro Bay will not participate in the exchange but will still receive state water, a pipeline would be built to provide water to Morro Bay and would pass right by the California Men's Colony. The County Operations Center could therefore be served through an existing connection to CMC's system and would be able to utilize existing wells to provide for their peaking needs (unlike Cuesta College). The total exchange amount would be 381 afy which would require approximately 530 afy (ie. 149 afy reduction to City + 381 afy exchange) of state water to offset the reduction in the City's yeld. Each agency would receive approximately 729o' of the state water exchanged with the City. It should be noted that Cuesta College already receives water from the City of San Luis Obispo. Any amount of State Water'excbanged with Cuesta will have a positive impact on the City's water supply situation by offsetting the current demand on Whale Rock Reservoir. Alternative 4: Only exchange water with the Cayucos Area Water Organizations. The total amount of the exchange would be 181 afy which would require approximately 210 afy of state water. The agency would receive ,. approximately 8617o of the state water exchanged with the City. The County Board of Supervisors have approved state water for County Waterworks District No. 8 in Cayucos contingent on an exchange. If an exchange can not be agreed upon,there is a serious question as to whether the other two Cayucos agencies could afford to construct the pipeline from Morro Bay to Cayucos. If this alternative were implemented, Cuesta College would need to negotiate with CMC to provide for peaking capability. Alternative 5: No exchange of Whale Rock water for state water. This would effectively eliminate the Cayucos Area Water Agencies from participation in the state water project. S City o� san tins oaispo COUNCIL AGENDA REPORT State NN'ater Project - Whale Rock Exchange Page 6- Table II: Summary of Alternatives Aeencies SWP Amount Exchange Amount % of_SWP Amount €xchanged 1. All 2,025 19145 54% 2. All, except 1,355 806. 6017o Marro Bay 3. Cayucos & 530 381 72% Cuesta College 4. Cayucos 210 181 $6% FISCAL IMPACT: There would be a financial benefit to the City of San Luis Obispo depending on the amount of water exchanged. Savings would result from decreased pumping required from Salinas or Whale Rock Reservoir. The City could also benefit from increased deliveries of State Water if the proposed hydroelectric facility were constructed by the City at the first City turnout from the pipeline at Reservoir No. 1. The increased flows, if delivered to this location, would result in increased energy production. The exact extent of the benefits to the City have not been estimated at this time due to the large number of alternatives. There would also be a savings to the agencies that participate in the exchange resulting from not having to construct the pipeline up the Chorro Valley. The agencies would have to provide for treatment of the surface water from Whale Rock which would reduce their potential savings. RECOMMENDATION: Staff recommends the Council direct staff to proceed with Alternative 3 or 4, staff would work with Cuesta and CMC to negotiate an agreement to provide for Cuesta's peaking needs. Also, recommend that CMC accept state water directly if a pipeline is constructed to their facilities. These alternatives would have the least impact on the City's water supply resources while still accommodating the needs of, Cuesta College and Cayucos Water agencies. Attachment: 1. Map of Proposed Chorro Valley Pipeline PAPrY\SM7CXe wP 7-TACHMENT 1 L l y �► L �I r f• '� V CP 1 N i• V. O � / 1 1 C cc .E r r / � I a ° jS •/1 Q ' �• o i " i x3434 7 I � • . - o v P r • • � 0 r t •, CEO a s�P o ue _ 3 >tr use • � � X 0 2 �O� Y O . k Q = � .u► epi •a 1 - �f I ' •� � � Sal I A~ -ACHMENT 1 . . r . • '•`% ' Moms BAT T CArXVS SEGMENr ' w n ELENA STREET CONNECTION - W 1rniAo N •C CUESTA TU MM TO �•• �� MORNO SAT SEGNOff \ " ,.• SAN UERNAIlDO (CANE)/ OUINTANA ROAD CONNECTION r a uoBBo BST w � �w•AA• • ♦�Ae w boOMD DAV-LOS . w osoS aEOAaxr 1-, w O O'l M I =L�DCALD=70119=011 • N SCALE 7000 !RT