GrokSurf's San Diego

Local observations on water, environment, technology, law & politics

Archive for the ‘San Diego County Water Authority (SDCWA)’ Category

« Previous Entries

Carlsbad desalination plant tour (photos)

Posted by George J Janczyn on February 23, 2016

Here are photos I took today during a guided tour of the recently opened Claude “Bud” Lewis Carlsbad Desalination Plant. The tour was conducted by Jessica Jones, Community Outreach Manger for Poseidon Water. Additional tours will be held in the future, although many of them are already booked. See Poseidon’s website for tour information (http://carlsbaddesal.com/visit).

Photos can be clicked for an enlarged version, which may be needed to read the posterboard descriptions. The last photo shows everyone receiving a glass of newly desalinated water.

_DSC0491a

_DSC0494a

_DSC0504a

_DSC0508a

_DSC0528a

_DSC0499a

_DSC0501a

_DSC0503a

_DSC0505a

_DSC0506a

_DSC0507a

_DSC0510a

_DSC0511a

_DSC0512a

_DSC0516a

_DSC0518a

_DSC0524a

_DSC0525a

_DSC0527a

 

Posted in Carlsbad Desalination Project, Desalination, Poseidon Desalination Plant (Carlsbad), San Diego County Water Authority (SDCWA) | 3 Comments »

San Diego City Council to consider 2013 water rate case (updated)

Posted by George J Janczyn on August 1, 2013

RESIDENTS WHO CONSERVE COULD SEE LOWER RATES IN 2014

The San Diego City Council’s Natural Resources & Culture Committee (NR&C) on July 31 accepted a proposal for a new water rate billing structure, including a rate increase, and sent it to the City Council for consideration at its September 10 meeting. The committee recommends a new billing method that would use a four-tier rate structure designed to provide a greater financial incentive to conserve water. The current rate structure has three tiers with weaker conservation incentives.

The new rate structure is an option in the 2013 Water and Wastewater Cost of Service Study delivered at the NR&C meeting. 43 percent of the water ratepayers in San Diego (those who use 10 HCF or less per month) could see lower rates under the new plan, according to Public Utilities Department (PUD) staff that presented Study. Those who consume water at the high end of the scale (19+ HCF) would pay dramatically higher rates (HCF = Hundred Cubic Feet = 748 gallons). More details about rates will follow below.

Current operating situation of the Public Utilities Department.

Current operating situation of the Public Utilities Department.

BACKGROUND

For the past two years PUD has been operating under a requirement to “absorb” rate increases for imported water that it buys from the San Diego County Water Authority (SDCWA or CWA), rather than pass the cost on to ratepayers. San Diego imports some 80% of the water it uses.

The decision to do that was made by then-Mayor Jerry Sanders in mid-2011. The news was well-received by the public, likely because of the recession, high unemployment rates, and of course, because nobody likes rate increases. Public opinion and Sanders’ decision may also have been influenced by Carl DeMaio, a city councilmember who had positioned himself as a mayoral candidate for the 2012 election and was waging an aggressive campaign arguing that past water rate increases had been excessive due to mismanagement within PUD. One of DeMaio’s goals was to cut water rates by 15% and then freeze rates at that level for five years.

So, PUD had a tightrope to walk.

SUSTAINING OPERATIONS

To “absorb” SDCWA’s 2012 rate increase PUD cut back on contracts, supplies, materials, personnel, and drew down reservoir “surplus” so that less imported water would need to be bought, at a fiscal impact of $17.5 million.

This year, the fiscal impact on PUD from SDCWA’s 2013 price increase is estimated to be $20.6 million due to further cuts in contracts, supplies, materials, personnel, and drawdown of reserve funds.

“Over the last two years (Calendar Years [CY] 2012 and 2013), PUD absorbed CWA’s purchased water increases. PUD estimates that the cumulative impact of these increases is approximately $35 million. PUD was able to absorb the impacts through a combination of one‐time revenues, drawing on reserves, and implementing operational efficiencies. However, as Tables 10 and 11 indicate, continued absorption of the CY 12/CY 13 pass‐through increases, and trying to absorb the CWA CY 14 increase is not sustainable. If the City does not make revenue adjustments in FY 14, then by FY 15, PUD will not meet DSC requirements for senior or aggregate debt.”

(From the Study)

“ABSORB” IS THE WRONG WORD

The problem with saying PUD had to “absorb” higher rates is that they are not one-time expenses; they are permanent, and future SDCWA rate hikes will just add to the burden.

Assistant PUD Director Alex Ruiz made just that point at the Independent Rates Oversight Committee (IROC) at its July 18, 2011 meeting, saying the situation would be more properly called “Deferral of Rate Increases” rather than absorption of increased costs.

On top of all that, new imported water rate increases for 2014-2015 have already been announced by SDCWA.

Water purchases have decreased while cost has gone up.

Water purchases have decreased while cost has gone up.

FACING THE INEVITABLE

It seems fairly obvious that in order for PUD to continue as a viable self-supporting enterprise (i.e., not funded by local taxes), water rates will have to go up. But what should the price be?

Guidance on that question is contained in the Cost of Service Study delivered to NR&C (the study is also referred to as the 2013 Rate Case). The Study examined “what actions the PUD should undertake to maintain the financial viability of the Water and Wastewater enterprises in light of the results of the 2007 Rate Case, increasing purchased water costs, minimal economic growth, regulatory requirements, and needed future large infrastructure investments.”

The Study has three components: (1) Determining total revenue requirements; (2) Allocation of costs to the appropriate customer class; and (3) Rate design.

CHALLENGES AHEAD

“Since 2008, the effective rate that the City pays for purchased water from CWA (cost/acre‐foot purchased) has doubled. Infrastructure investments by both CWA and Metropolitan Water District of Southern California, restricted allocations from the Colorado River, and the Bay‐Delta all continue to drive costs up, while declining sales reflecting conservation efforts are driving down revenues.”

“Historically, the City has passed increased rates from CWA through to ratepayers. Over the past two years (Calendar Years 2012 and 2013), PUD has used one‐time revenue sources, identified operational efficiencies, and additional local supplies to absorb the CWA pass‐through increases, which is estimated to be approximately $35 million. These increases, however are not one‐time, but continue on yearly. Continuing to absorb these increases creates a structural deficit that is not sustainable. ”

“Over the past two years (Calendar Years 2012 and 2013), PUD has used one‐time revenue sources, identified operational efficiencies, and additional local supplies to absorb the CWA pass‐through increases, which is estimated to be approximately $35 million.”

(From the Study)

The Study suggests a revenue adjustment of 7.25% in FY14 and 7.5% in FY15 for PUD. That translates into two rate increases over the two year period. Several options for a new tiered billing structure were given, and as noted earlier, the NR&C committee recommended Option 4 (shown in the tables below).

PUD will still need to finance some capital improvement projects through a combination of fully drawing down the Dedicated Reserve from Efficiency and Savings (DRES) fund and using cash on hand.

Fortunately, the Study’s recommendation for wastewater rates (sewer charges) is to leave them alone. The Study says, “Based on the analyses of revenues and revenue requirements, Black & Veatch recommends that Wastewater does not need a rate revenue increase in FY 14 and FY 15.”

NEXT STEPS

The Study (or Rate Case) will be placed on the September 10 City Council agenda. If councilmembers approve the rate proposal, they will schedule a public hearing in accordance with Proposition 218. That would have to happen fairly soon, since the plan aims for the first rate increases to take effect on January 1, 2014 and the second increase on January 1, 2015.

Keep in mind that further rate increases, in addition to those proposed, are possible in the future because the Cost of Service Study didn’t take into account future expenses from potable reuse projects, desalinated water from Poseidon’s Carlsbad Desalination Plant, and the coming 2015 expiration of the waiver that allowed the Point Loma Wastewater Treatment Plant to avoid upgrading to the secondary treatment standard mandated by the Clean Water Act. If negotiations for a new waiver are unsuccessful the City could face some very expenses choices.

WATER RATE DETAILS

The tables below illustrate the various options identified in the Cost of Service Study. Again, option 4 was the committee’s preferred alternative. Beneath the tables, there are links to documentation submitted to NR&C.

ProposedMeterRates
ProposedCommodityRates
ProposedIrrigationCommodityRates

 

SUPPORTING MATERIALS SUBMITTED TO THE COMMITTEE

______________________________

UPDATE September 8, 2013: below are links to selected documents that were posted as accompanying materials for the September 10 City Council agenda item on this topic.

 

Posted in San Diego County Water Authority (SDCWA), San Diego Public Utilities Department (PUD), Water | Tagged: , , , | 2 Comments »

Bureau of Reclamation awards $1.025 million toward San Diego watershed basin study

Posted by George J Janczyn on July 29, 2013

The U.S. Bureau of Reclamation has agreed to contribute funding in the amount of $1,025,000 in fiscal year 2013 for a San Diego Watershed Basin Study proposed by the City of San Diego along with two other local agencies.

According to San Diego’s proposal, the study’s two primary objectives are:

  1. Determine how climate change will impact the current and future water supply portfolio of the San Diego region.

  2. Develop infrastructure options within the San Diego Basin that can serve as adaptation strategies to manage climate change impacts, focusing on optimizing the reservoir systems and furthering development of indirect potable reuse.

There are uncertainties associated with Northern California and Colorado River water (regulatory restrictions and dry conditions, respectively) upon which the San Diego region relies for 70-90% of its needs. While previous work has been done to address the potential gap between supply and demand from the above causes, the potential climate change effects were not taken into account. The proposed watershed basin study would analyze those effects.

The San Diego Public Utilities Department (PUD) is the project sponsor, with the San Diego County Water Authority (SDCWA) and the County of San Diego serving as partners.

The San Diego watershed basin study is comprised of six sub-hydrologic units (HU) within San Diego County highlighted above in blue.

The San Diego watershed basin study area is comprised of the six sub-hydrologic units (HU) within San Diego County highlighted above in blue. Click map to enlarge.

Budget: $1 million was requested from Reclamation, a grant of $782,244 was secured from the San Diego Integrated Regional Water Management (IRWM) Program, and $300,000 would be paid by PUD creating a project total of $2,082,244.

The San Diego IRWM Program, formed in 2005, has a vision for “[a]n integrated, balanced, and consensus-based approach to ensuring the long-term sustainability of the Region’s water supply, water quality, and natural resources.”

In addition to approving the requested $1 million, the Reclamation Bureau granted an additional $25,000. In its notification letter to the city, the Bureau said “…funding will be provided in two phases. First, $25,000 will be allocated for the development of a detailed Plan of Study… [and] Contingent upon Reclamation’s approval of the Plan of Study, $1,000,000 will be allocated for conducting the study.”

Work on the Plan of Study and a Memorandum of Agreement begins today at a kickoff meeting between the study partners and a representative from Reclamation. The Plan must be submitted for approval by September 30.

The new basin study might be able to consider aspects of a four-reservoir intertie project for which San Diego and Sweetwater Authority tried to execute a feasibility study in 2011 but were unsuccessful partly because, according to PUD Principal Water Resources Specialist Cathleen Pieroni, hoped-for funding from the Bureau of Reclamation fell through because the Bureau was unable to get an allocation from Congress did not appropriate the funding necessary to complete the Study that it authorized.

Tasks for the San Diego Watershed Basin Study include basin water supply and demand projections, climate change evaluation, development of adaptation strategies, and a trade-off analysis. The final report is expected to be ready in mid-2015.

 

Posted in Environment, Land use, San Diego County Water Authority (SDCWA), San Diego Public Utilities Department (PUD), Water | Tagged: , , | Leave a Comment »

Mission Trails to Lake Murray water pipeline relining project begins in August

Posted by George J Janczyn on July 18, 2012

The San Diego County Water Authority (SDCWA) will conduct an open house to discuss its Mission Trails to Lake Murray water pipeline relining project due to begin in August.

Background (reprinted from SDCWA’s website):

“In October 2008, Pipeline 4 failed in a fairly remote section of Mission Trails Regional Park, near the San Diego River. After the failure, the Water Authority performed forensic analysis on the pipe and determined that a short section of the pipe needed to be urgently relined with steel. Subsequently, from mid-February through mid-March 2009, the Water Authority relined approximately 1,200 feet of Pipeline 4 north and south of the San Diego River.”

“This relining project will reline the sections of Pipeline 4 that were not urgently relined. Generally, relining construction rehabilitates segments of pipelines based on their age and the need for improvements. The Mission Trails to Lake Murray Relining Project involves rehabilitating approximately 3 miles of Pipeline 4 beginning immediately south of State Route 52 in Mission Trails Regional Park east of the community of Tierrasanta and continues south to Lake Murray in the community of San Carlos. It also involves rehabilitating approximately a half-mile portion of Pipeline 3 along Lake Shore Drive, south of Jackson Drive, in the community of San Carlos and city of La Mesa.”

Additional detailed information about the project is available at SDCWA’s website.

Here’s the announcement (for easier reading there’s a button at the bottom right of the announcement window to view full screen):

 

Posted in San Diego County Water Authority (SDCWA), Water | Tagged: , , | Leave a Comment »

SDCWA special workshop on Poseidon Carlsbad desalination project

Posted by George J Janczyn on June 15, 2012

A San Diego County Water Authority (SDCWA) Board of Directors special workshop on the Carlsbad Seawater Desalination Project was held Thursday, June 14.

On the agenda for the informational workshop was a) integration of the Carlsbad Desalination Project into existing infrastructure, b) examination of the range costs with comparisons to the unit cost of alternative local supplies, and c) incorporation of costs related to desalinated water from Poseidon’s Carlsbad plant into the Water Authority’s rates and charges.

Although it was an informational workshop, not a decision-making meeting, there were several people who took advantage of the public comment period before the session began, including Nate Cooper and Julia Chunn-Heer (representing the San Diego chapter of Surfrider Foundation) who encouraged that more effort be used on soliciting public input on desalination and that Indirect Potable Reuse (aka IPR, aka purified recycled water) be given a much higher priority than it now has in SDCWA’s strategic thinking.

Water Resources Director Ken Weinberg was the main speaker at the workshop. The first segment was to explain SDCWA’s efforts at “Balancing Treated Demand and Annual Contractual Commitment.”

SDCWA, being the water wholesaler to 24 member agencies in San Diego County, sells/provides both treated and untreated water. Approximately 60% of its deliveries are untreated water, 40% treated water. The desalinated water from the Poseidon Carlsbad facility is treated water. The question is how to integrate the treated desal water into the existing treated water infrastructure delivering that 40%.

Presently SDCWA gets its treated water via existing contractual (and even mechanically built-in*) requirements to buy a minimum amount of treated water from MWD (via the Skinner Water Treatment Plant) and needs to produce a minimum amount at its own Twin Oaks Valley WTP.

The Authority also provides treated water indirectly through arrangements with individual member agencies such as Helix Water District and the City of San Diego (who buy untreated water and treat it themselves) to provide treated water to areas that SDCWA can’t reach with its own infrastructure.

The prospect of SDCWA using the Poseidon Desalination facility as a new source of treated water meant that the countywide demand for treated water needed to be thoroughly analyzed, including study of local hydrology, seasonal variation, and projected future demand.

The goal: optimize the use of all regional treated water facilities and figure out what the Water Authority’s contracted annual minimum deliveries from Poseidon should be.

At one point it was acknowledged that the City of San Diego’s potential use of IPR wasn’t taken into account in the demand study because the city buys only untreated water from SDCWA and does its own treatment, i.e., if San Diego produces IPR water for itself there would be no effect on countywide demand for treated water.

Director Keith Lewinger picked up on this and made an interesting point that was startlingly obvious even though some of us may not have really considered it: if San Diego engages in a large-scale IPR operation it will buy less untreated water from SDCWA which could be financially harmful to SDCWA.

(The implication, in my view, is that this could influence just how much wholehearted support San Diego gets from SDCWA for implementing IPR on a large scale. Also, it seems to me that things will be quite complicated on many levels because San Diego’s purified recycled water (IPR) would reside in the San Vicente Reservoir but SDCWA will own the rights to the reservoir’s additional capacity when the dam raise project is completed. Many issues and kinds of water will be all mixed up.)

The second portion of the workshop focused on costs and how they would be incorporated into rates and charges. This part of the study is also extraordinarily complicated but I’ve no time or space to give justice to the breadth of that discussion.

Bradley Fikes gives the costs and rates issue a closer look in his North County Times story “Desal project would raise average water bills 7 percent“. Mike Lee’s U-T San Diego article “Carlsbad desal plant, pipe costs near $1 billion” chimes in on the issue.

The agenda, full audio recording of the workshop, and the presentation slides from the June 14 meeting are available on SDCWA’s website [link].

Note this was an informational workshop, not one where decisions were made. Check the presentation slides mentioned above. The last slide shows Next Steps listing future meeting dates and topics to be addressed (and opportunity for public commment, I hope) over the next several months.

______________________________

* Mechanical, in that the meter/valve on the treated water pipeline incoming from MWD cannot measure the amount of flow if it is below the minimum contracted amount. If less is taken, payment for the full amount is still required.

 

Posted in Carlsbad Desalination Project, Poseidon Desalination Plant (Carlsbad), Purified recycled water, San Diego County Water Authority (SDCWA), Water | 1 Comment »

San Diego’s connection to the Colorado River

Posted by George J Janczyn on May 12, 2012

Halla Razak, P.E., Colorado River Program Director at the San Diego County Water Authority (SDCWA) provides an overview of the Quantification Settlement Agreement, the associated canal linings and the benefits to the San Diego area.

(Slides shown on the video are unclear; clear slides via Slideshare are shown below, you can just follow along by clicking through the slideshow):

 

Posted in Colorado River, Quantification Settlement Agreement (QSA), San Diego County Water Authority (SDCWA), Water | Leave a Comment »

Water Authority responds to San Diego Taxpayers Educational Foundation report

Posted by George J Janczyn on January 17, 2012

[News Release]

January 16, 2012 –

The San Diego County Water Authority today responded to a report by the San Diego Taxpayers Educational Foundation that studied labor costs at the agency between 1999 and 2009.

“The Taxpayers Educational Foundation and the San Diego County Taxpayers Association serve important roles informing our community on issues impacting taxpayers and water ratepayers,” said Maureen Stapleton, general manager of the Water Authority. “The Taxpayers’ study focuses primarily on how much labor costs at the agency rose between 1999 and 2009. We believe it is equally important for ratepayers to be fully informed why the Water Authority’s workforce and labor costs grew during the decade. The Taxpayers’ report does not provide an equal focus on that part of the story.

“Ratepayers need to know what value they receive for their dollars.”

The Water Authority’s workforce grew between 1999 and 2009 to support new historic water supply reliability programs and the peak planning and construction period for its $3.5 billion Capital Improvement Program, including:

  • Negotiating and implementing the 2003 Quantification Settlement Agreement and managing Colorado River water transfer and canal-lining agreements included in the QSA. These long-term agreements will provide 170,000 acre-feet of new, highly reliable water for the region this year – enough to meet 27 percent of the region’s water needs. These supplies will grow to provide 280,000 acre-feet annually by 2021 – enough to meet more than one-third of the region’s water needs.

  • Emergency Storage Project: This $1.5 billion project, when complete, will ensure that the region will have up to a six-month supply of locally stored water if an earthquake or other disaster cuts off imported supplies. Construction of this network of more than a dozen major facilities, including dams, reservoirs, pipelines, pump stations, surge controls and more, began in 2000. Most of the facilities – including the Olivenhain Dam, reservoir and pipeline, the Lake Hodges pumped storage facilities, the San Vicente Pipeline, and the San Vicente Surge Tank and Pump Station, are now complete.

  • San Vicente Dam Raise: This project, the tallest dam raise project in the United States, will more than double the capacity of the city of San Diego’s San Vicente Reservoir. It is part of the Emergency Storage Project and will store an additional 52,100 acre-feet of water for emergency use. It will also add 100,000 acre-feet of carryover storage capacity – water stored during wet years to help meet demands during dry years. Construction began in 2009 and is expected to be complete in 2013. Since 1999, the Water Authority has added 114,375 acre-feet of regional water storage, and that figure will grow to 266,375 acre-feet when construction on the San Vicente Dam Raise Project is complete.

  • Twin Oaks Valley Water Treatment Plant: The plant, the largest submerged membrane water treatment plant in the world, was built between 2006 and 2008. It can produce 100 million gallons of high-quality treated water daily and reduces the region’s reliance on facilities outside of the region to meet treated water demands.

  • Pipeline Relining Program: This program, started in 1996, cost-effectively extends the service life of 82 miles of vital large-diameter pipelines around the region by inserting steel linings. The program is now one-third complete. Between 1999 and 2009, the Water Authority lined more than 22 miles of pipelines as large as 96 inches in diameter, extending their useful life by 50 years or more.

  • Aqueduct System Expansion: The Water Authority built 34 miles of new large-diameter pipeline, including the 11-mile long San Vicente Pipeline and Tunnel, an increase of 12 percent in the Water Authority’s aqueduct system. The Water Authority also built 22 new pumping control facilities, an increase of 26 percent in such facilities.

  • Electrical Power Generation– Since 1999, the Water Authority built nearly 42 megawatts of hydropower electrical generation capacity, helping to meet the region’s energy needs and generating revenues to help moderate water rate increases.

“Until this past decade, San Diego County was over-reliant on a single supplier to meet up to 95 percent of this region’s water needs,” Stapleton said. “Today, with the investments in the Imperial Irrigation Water Transfer, canal lining projects and other programs and projects, our region has a more diversified, and more reliable water supply.”

The following graphic depicts San Diego County’s water supply portfolio as it existed in 1999, compared to today.

Click on image above to enlarge

Stapleton also called the period covered in the Taxpayers’ report “the biggest decade in the agency’s history for building new, large-scale water infrastructure to serve our region.” The following graphic depicts the Water Authority’s infrastructure as it existed in 1999, compared to today.

Click on image above to enlarge

“These investments support the region’s $186 billion economy and 3.1 million people, and will continue to serve our region for generations to come,” said Michael T. Hogan, chair of the Water Authority’s Board of Directors. “The region’s residents and businesses have received very strong returns for their investments in new long-term water supplies and infrastructure projects.”

Water Authority compensation costs grew at a rate comparable to entities in the private sector. Figures from U.S. Bureau of Labor Statistics show per-hour compensation costs at private utilities nationally grew 30 percent between 2004 and 2010, a period for which such data was available and that overlapped the years reviewed in the Taxpayers’ report. Water Authority per-hour compensation costs grew 33 percent over the same period.

Stapleton noted that since 2009, the Water Authority has reduced its workforce in accordance with plans made more than a decade ago. For example, the Water Authority used limited duration employees to help meet the peak staffing needs associated with its Capital Improvement Program. As capital spending is dropping, the Water Authority is eliminating limited duration positions as planned.

“The Water Authority is undergoing the largest workforce reduction in our agency’s history and taking other measures to manage labor costs,” Stapleton said.

Measures the Water Authority has taken since 2009 include:

  • Executing a workforce management plan that will reduce staff positions 16 percent between 2008 and 2014. As part of this plan, the Water Authority is eliminating 31.33 full-time positions during the current two-year budget cycle. Many of these positions are “limited duration” positions that were designed to end as specific construction projects and other limited duration staffing needs ended.
  • Requiring employees to pay an increased share of their retirement benefits (4.5 percent of employee contribution, up from 0 percent in 1999).
  • Deferring 14 construction projects worth $150 million to July 2014 or later.
  • Making $6 million in mid-year operational budget cuts in fiscal years 2010 and 2011.
    Adopting a budget for fiscal years 2012 and 2013 that features $235 million lower spending on capital projects and a 7 percent decrease in the cost of operating departments.
  • Aggressively refinancing its debt portfolio to reduce the costs of financing capital projects. Bond refunding sales this year are expected to save $18.7 million in financing costs on a present-value basis over the life of the bonds.
  • The recent increase in unfunded liabilities at the Water Authority is largely related to poor economic conditions and market performance in recent years. This phenomenon is common among public agencies and private entities with pension plans.

Labor costs represent only about 6 percent of the Water Authority’s budget, and are not significant drivers of recent rate increases, Stapleton noted.

One of the biggest drivers of recent and projected water rate increases is increased water supply and transportation costs imposed by the Metropolitan Water District of Southern California, the San Diego region’s largest supplier. The cost to purchase treated water from MWD increased 94.6 percent from 2003 to 2012. In addition, the rates MWD charges the Water Authority to transport its independent Colorado River supplies through MWD’s conveyance and distribution system have increased 56.5 percent over the same period.

The Water Authority alleges that MWD improperly overcharges the Water Authority for the transportation of its independent Colorado River supplies and uses that money to subsidize the cost of MWD water to its other 25 member agencies. This violates California’s Constitution, other state law, and standard water utility practice. In June 2010, the San Diego County Water Authority Board of Directors unanimously approved filing suit against MWD over its rate structure.

MWD’s rate structure causes significant financial harm to the San Diego region. San Diego County will be overcharged by about $40 million in 2012; those overcharges will grow to as much as $220 million annually by 2021, and total as much as $2.1 billion over the next 45 years. The case is being heard in San Francisco Superior Court. More information on the rate challenge is available at www.sdcwa.org/mwdrate-challenge.

“The Water Authority is dedicated to ensuring our region has a safe and reliable water supply,” Hogan said. “We understand ratepayers want to make sure their dollars are being spent wisely and prudently to achieve that mission.”

The Water Authority holds long-term senior lien credit ratings of AA+, AA+ and Aa2 from Standard and Poor’s, Fitch and Moody’s, respectively. The Water Authority also holds subordinate lien credit ratings from those agencies of AA, AA and Aa3, respectively. (Subordinate lien credit ratings are typically at least one level below senior lien credit ratings.) The Water Authority’s current credit ratings are considered high quality by all standards and are held by only a few select water agencies in California. High credit ratings benefit ratepayers by helping to lower the cost of borrowing.

The Water Authority is recognized nationally for its sound financial management practices. It has received the Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association of the United States and Canada for 11 consecutive years. It also received the 2010 Excellence in Budgeting Award from the California Society of Municipal Finance Officers.

More financial information about the Water Authority is available at www.sdcwa.org/financials-investor-relations.

—————————————————————————————-

The San Diego County Water Authority is a public agency serving the San Diego region as a wholesale supplier of water from the Colorado River and Northern California. The Water Authority works through its 24 member agencies to provide a safe, reliable water supply to support the region’s $186 billion economy and the quality of life of 3.1 million residents.

MEDIA CONTACT INFORMATION
Donna Nenow
Office: (858) 522-6707
Cell: (858) 414-8168 		MEDIA CONTACT INFORMATION
Jason Foster
Office: (858) 522-6701
Cell: (858) 761-5950

 

Posted in San Diego County Water Authority (SDCWA), Water | Tagged: , | 1 Comment »

County Water Authority mobile app is latest in social media efforts

Posted by George J Janczyn on October 26, 2011

As part of an ongoing effort to integrate social media into its public outreach programs, the San Diego County Water Authority (SDCWA) announced yesterday a free mobile smartphone app that provides access to Water Authority news and Board documents.

Dubbed “Water News” in SDCWA’s news release, the app supplies “Water Authority news releases, videos, top issues, board documents, legislative information and a 24-hour water-related news feed.”

Versions for iPhone and Android smartphones are available now, and a version for Blackberry will also be released soon. [update Nov 19–the Blackberry version has now been released].

SDCWA had conducted numerous internal discussions and solicited public feedback to generate ideas to improve public outreach and began implementing social media tools beginning in 2009. Over the last two years it launched a Facebook page, Slideshare page, and a YouTube channel. It has not yet established a Twitter presence, although it did experiment with “@paths2partners” for its “Paths to Partners” small business and networking event. The popular Water Talks forums were also an outgrowth of these efforts, as was SDCWA’s website redesign making information easier to find.

Public Affairs Representative Craig Balben led the development team as project manager to produce a plan for functionality and design. Coding for the apps on the three mobile platforms was outsourced to Bytes, Inc. last March at a cost of $33,760. Design and functionality are the same on all apps, although there are slight variations in appearance depending on the platform.

The app can be downloaded by visiting the market for your platform and searching for “SDCWA water news.”

Permissions required on the Android version that I downloaded were: prevent phone from sleeping, full internet access, fine GPS location, allow app to control phone vibrator, and view wi-fi and network state.

There are two unwelcome (for me) behaviors of the Water News app. First, it launches automatically when the phone is started. I prefer to start apps at my own discretion, but there is no way to override that default behavior. Second, whenever fresh news is available the app sounds an audible alert. There is no setting to turn that off either, other than to put the phone in silent or vibrate mode. I hope these issues will be addressed in a future version of the product.

Overall, the app makes a good addition to SDCWA’s already excellent public outreach efforts.

[Update on the auto-launch and audible alert: when booting the phone the app automatically launches into the background and continuously scans for news updates. One “feature” of the audible alert is that it keeps ringing periodically even when there appears to be no new news. Craig Balben told me that it’s not just the main news page that triggers alerts, but items in the “more” submenu do as well. Further, unless one actually reads (opens) the news item, the audible alerts will continue. Craig said this annoyance is on the list for future fixes.]

 

Posted in San Diego County Water Authority (SDCWA), Water | Tagged: , | Leave a Comment »

Grand Jury’s water rates report is ‘right on the money’

Posted by George J Janczyn on July 28, 2011

[Reprint of a news release from the San Diego County Water Authority]

On June 28, [sic; i.e., July 28] the San Diego County Water Authority Board of Directors largely concurred with the key findings contained in the May 31 San Diego County Grand Jury report, “San Diego County Water Rates: High Today, Higher Tomorrow”. The report determined that the region’s water rates are likely to continue to rise, that underrepresentation on the Board at Metropolitan Water District of Southern California (the Water Authority’s largest imported water supplier) harms the interests of the region’s ratepayers, and the region’s water agencies have not clearly communicated why water rates are rising.

The Board determined the Water Authority has implemented or is implementing the report’s recommended actions for developing new local water supplies, pushing for fair representation at MWD, and improving public outreach.

The Water Authority also offered clarifications on two of the report’s findings related to water rates.

  • The increasing cost of water and transportation service from MWD today remains the largest driver of rate increases in San Diego County. The need to develop new local supplies, and thus incur those costs, is not being driven principally by the needs of growing population or development. Instead, it is driven by uncertainties surrounding the future availability of imported water from MWD.
  • Effectively communicating information about water rates is often difficult to do quickly and easily. Obstacles include the inherent complexity of region’s water supply and rate-related issues, constantly changing hydrological conditions that affect supplies and rates, and varying rates among the region’s local retail agencies. Nevertheless, the Water Authority acknowledged the need for clear communications is increasing and that it is working to enhance its outreach efforts.

For more details on the Grand Jury’s report and the Water Authority’s response, please click on the resources below.

 

Posted in San Diego County Water Authority (SDCWA), Water, Water rates | 2 Comments »

The unsettled water rates in San Diego

Posted by George J Janczyn on July 19, 2011

San Diego’s most recent water rate hike last March happened because the Metropolitan Water District of Southern California (MWD) raised its water rate to the San Diego County Water Authority (SDCWA) which in turn raised the water rate for county water agencies that it supplies (including the City of San Diego). San Diego, of course, typically needs to import 85-90% of its water so it doesn’t have much recourse.

As a result, the City Council reluctantly approved a “pass-through” water rate increase for City customers effective March 1 to cover the SDCWA rate hike. The Council also sought to exert some pressure on MWD.

The perceived pressure point was SDCWA’s lawsuit against MWD charging that it illegally inflates the price of water for San Diego County. The City naturally supports that position so when approving the pass-through increase the City Council asked the City Attorney to recommend whether the city should join SDCWA’s lawsuit against MWD, and also asked the Mayor’s Intergovernmental Relations Department to develop a recommendation for seeking state legislative support for auditing MWD pricing practices.

Here we must note that an underlying issue in SDCWA’s lawsuit against MWD is that in addition to buying water from MWD, SDCWA buys Colorado River water from Imperial Valley as part of the Quantification Settlement Agreement (QSA). However, there are no water pipelines from Imperial Valley to San Diego so SDCWA needs to pay MWD to capture Imperial Valley’s water upstream at Lake Havasu and transport it through the Colorado River Aqueduct to San Diego’s pipelines.

MWD’s charge to transport that water (wheeling charge) is a big deal. SDCWA says MWD illegally inflates the wheeling charge with expenses unrelated to the Colorado River Aqueduct (e.g., costs associated with obtaining State Water Project water from Northern California).

The disagreement over water transport pricing is an old issue that was already evident when the QSA was enacted in 2003. The Record of Decision actually memorialized that “…MWD and SDCWA do not agree on the nature or scope of rights to the delivery, use or transfer of Colorado River water within the State of California.”.

So when MWD and SDCWA signed their agreement for transporting the water, the contract included a provision that “after conclusion of the first five years, nothing shall preclude SDCWA from contesting in an administrative or judicial forum whether such charge or charges have been set in accordance with applicable law and regulation.”

Which is exactly what SDCWA is now doing with its lawsuit.

Meanwhile, on another front around that time, MWD had been developing incentive agreements to provide rebates and subsidies for local conservation and recycled water programs. Those programs are funded through MWD’s Water Stewardship Rate fee charged to all MWD member agencies.

Here’s where MWD got tricky: in 2004 MWD adopted so-called Rate Structure Integrity (RSI) language in the Water Stewardship agreements to the effect that if a member agency “files or participates in litigation or supports legislation to challenge or modify Existing Rate Structure…Metropolitan may initiate termination of this Agreement.”

So, after MWD refused to modify its wheeling charge and SDCWA filed suit, in response MWD recently exercised its option to terminate support for some of the San Diego County programs. It partially retained a few residential and commercial agreements but decided against implementing larger agreements including funding for a San Vicente Recycling program in Ramona and a subsidy for the Poseidon Desalination Project in Carlsbad.

How would that affect the City of San Diego? At an Independent Rates Oversight Committee (IROC) Environmental & Technical Subcommittee meeting on July 10, Cathy Pieroni, Principal Water Resources Specialist for the Public Utilities Department reported that MWD’s Water Stewardship cuts would not impact existing MWD contracts with the City and that the City could still potentially obtain MWD funding for up to $250/AF for Indirect Potable Reuse (IPR) water if the Water Purification Demonstration Project materializes as a full-scale operation.

As for the City Council’s request that the City Attorney investigate possible legal action that could be taken to apply pressure on MWD over the rate hike issue, City Attorney representative Tom Zeleny said that his office will likely recommend against legal action, saying it “would probably not be cost-effective.” He said the official report from his office will be on the August agenda for the City Council’s Natural Resources and Culture Committee.

On the issue of the Council’s request to the Mayor’s Intergovernmental Relations Department, it appears the Mayor may have influenced Assemblyman Nathan Fletcher to introduce AB 779 relating to establishment of water district oversight committees. Faced with opposition (including MWD’s considerable influence), at the last minute Fletcher pulled the bill from its scheduled hearing indicating he would make it a two-year bill and proceed later.

MWD’s opposition to Fletcher’s bill can be seen in its May 16 board meeting minutes where it revealed its suspicion that AB 779 was related to the San Diego City Council’s desire for legislative intervention over MWD water rates:

“There is speculation, however, that AB 779 might be amended and used as a legislative vehicle to assist the San Diego County Water Authority (SDCWA) in its lawsuit against the Metropolitan Water District of Southern California (Metropolitan) which challenges Metropolitan’s water rates and charges. A judicial victory by SDCWA would result in a significant increase in the cost of water for Metropolitan’s customers outside SDCWA’s boundaries. The rationale for this speculation is based on a memorandum circulated by the San Diego City Council after the filing of the lawsuit that details potential parallel strategies regarding the issues addressed in the lawsuit. These strategies included seeking a Joint Legislative Audit to perform a financial audit of Metropolitan as well as sponsoring legislation to create an Independent Rate Oversight Committee for MWD to evaluate the price charged for water as well as operations.”

So for the time being AB 779 is stalled and prospects are uncertain, it doesn’t look like the City will pursue legal action, and other legislative initiatives seem iffy.

Instead, for the short term, the City will try to “absorb” the SDCWA rate increase announced for next fiscal year: Mayor Sanders has proclaimed that the City won’t raise water rates next fiscal year. Instead, he wants the Public Utilities Department (PUD) to take the hit from the higher expense.

Discussing the Mayor’s announcement at yesterday’s IROC meeting (July 18), Assistant PUD Director Alex Ruiz said the department will find an accomodation because local water supplies increased considerably during the last rainy season. As a result the department figures it can draw “up to” 20,000 AF of local supplies to avoid buying about $8.75 million in imports from SDCWA. The department is also looking at more staffing cuts and creating further “efficiencies.”

Although the action hasn’t been labeled a “deferred” price increase, that’s what it looks like. SDCWA’s higher price isn’t going away at the end of the next fiscal year and there will likely be another price hike announced for the following year as well. So at some point the City will have to cover the higher costs either by passing them on to consumers or by further “absorbing” expenses within the department at some risk to infrastructure and operations. And if you think capital improvement projects, maintenance and repairs, and EPA consent agreement work isn’t piled up already, think again.

Will San Diego have to “catch up” with deferred water rate increases? What’s the risk of drawing down the City’s emergency storage capacity now that it has some water saved? Are we using precious reserves to temporarily defer expenses as a political expedient? And what about popular support for setting water rates that discourage waste? Does artificially keeping rates down send a mixed message about that?

Whatever happens, I don’t think broader public understanding will come from would-be mayors accusing PUD of mismanagement over water rates and saying things like “I pledge to cut rates by 15% and freeze them for five years without any delay in our infrastructure investment and while maintaining the highest standards for water quality.”

 

Posted in Independent Rates Oversight Committee (IROC), Metropolitan Water District of Southern California, San Diego County Water Authority (SDCWA), Water, Water rates | Tagged: | 4 Comments »

« Previous Entries