1. Urban Water Institute, Inc. 22 nd Annual Water Conference August 28,2015 Busted by the State for Drinking Too Much: Enforcement of Emergency Conservation Regulations

2. Paul D. Jones II, P.E. General Manager Eastern Municipal Water District Busted by the State for Drinking Too Much: Enforcement of the Emergency Conservation Regulations 2

3. Christian M. Carrigan Director, Office of Enforcement State Water Resources Control Busted by the State for Drinking Too Much: Enforcement of the Emergency Conservation Regulations 3

4. Gregory J. Newmark Principal, Meyers Nave Chair, Drought Response Team Busted by the State for Drinking Too Much: Enforcement of the Emergency Conservation Regulations 4

5. Water Conservation Tiers Average July-Sept 2014 R-GPCD Reduce total potable water production by __% for each month compared to amount used in same month in 2013 <658% ≥65 but <8012% ≥80 but <9516% ≥95 but <11020% ≥110 but <13024% ≥130 but <17028% ≥170 but <21532% ≥21536% 5

6. Paul D. Jones II, P.E. General Manager Eastern Municipal Water District August 28,2015 Busted by the State for drinking too much: Enforcement of the Emergency Conservation regulations www.emwd.org 6

7. Established in 1950 Five publicly-elected board members One of 26 MWD member agencies 555 square miles –Cities served: Moreno Valley, Perris, Menifee, Murrieta, Temecula, Hemet, San Jacinto Population: 785,000 (34% of Riverside County) Full service agency, serving: –Water / wastewater / recycled –Wholesale and retail Water: 142,000 connections Wastewater: 237,000 connections High growth / very low precipitation area (~10 in/yr. avg.) Overview of EMWD EMWD CUSTOMER BASE: POTABLE WATER SERVICE CONNECTIONS Residential95% Commercial, Industrial & Institutional2% Landscape/Agricultural2% Wholesale1% www.emwd.org 7

8. EMWD Water Supply Portfolio Local Supply Initiatives 18 active wells (adjudicated and managed basin) and two potable water filtration plants o Production capacity: 34 million gallons per day (MGD) Two brackish groundwater desalters that produce 8 MGD Four regional reclamation facilities producing 45 MGD of recycled water In both FY 2014 and FY 2015, 100% of tertiary wastewater was recycled for beneficial reuse www.emwd.org 8 Imported Water Supply from MWD: 76,897 AF 51% State Water Project – 3% Colorado River (untreated and treated)- 48% Local Water Supply: 74,884 AF 49% Recycled Water Groundwater Wells Desalination FY 2015

9. EMWD Rate Structure Implemented in 2009 www.emwd.org 9 Creates an “Allocation” or “Water Budget” for each customer account based upon reasonable indoor and outdoor needs and efficient use. Uses Economic Incentives: Water is priced to customer lower for use within allocation – much higher for use over allocation. Indoor Usage Budget Persons x 60 GPD Tier 1: $1.793 ($779/AF) Price/CCF Outdoor Usage Budget Irrigated Area x ET Factor x Conservation Factor Tier 2: $3.280 ($1,428/AF) Wasteful Use More than 50% over budget Tier 4: $10.755 ($4,682/AF) Excessive Use Up to 50% over budget Tier 3: $5.879 ($2,561/AF) Over Allocation Within Allocation

10. Water Shortage Contingency Plan StageDate Approved DescriptionActions Stage 1April 2011Supply WatchVoluntary reduction up to 10% Stage 2April 2014Supply AlertVoluntary reduction up to 25% Stage 3August 2014 (3a) Mandatory Waste Reduction 3a: No variance adjustments; observation based penalties 3b: Tier 3 budgets decreased by 50% 3c: Tier 3 budgets decreased by 100% Stage 4May 2015 (4a) Mandatory Outdoor Reduction Watering schedules limited (1-2 days/week) 4a: Tier 2 budgets decreased by 10% 4b: Tier 2 budgets decreased by up to 50% 4c: Tier 2 budgets decreased by up to 100% Stage 5Mandatory Indoor Reductions Catastrophic stage (50% reduction in demand) 5a: Tier 1 budgets decreased by 10% 5b: Tier 1 budgets decreased by up to 30% 5c: Tier 1 budgets decreased by up to 50% After implementation of Stage 3a and associated outreach, EMWD saw Tier 3 “excessive” and Tier 4 “wasteful” sales and number of customers in these tiers dramatically decline. For July 2015 billing, 7% of customers were in Tier 4 while 93% of customers stayed in budget. EMWD Uses its Rate Structure to Progressively Move through its Water Shortage Contingency Plan: www.emwd.org 10

11. SWRCB Regulatory Framework Local Water Agencies Commented on Deficiencies in the Regulatory Framework –No credit is provided to agencies who achieved conservation prior to 2013. –The GPCD data is not adjusted for climate or housing density. –The base year/months are arbitrary and penalize warmer inland areas. –No credit is provided for local drought- proof supplies including desalination and recycled water, or shifts off SWP. State Board did not adopt the water industry’s call for framework revisions Local agencies worked together to provide a more credible quantitative model that still achieves a 25% statewide savings. www.emwd.org 11

12. Required Potable Water Use Reductions Riverside County Agencies www.emwd.org 12

13. Local Impacts of SWRCB Regulation Water SupplierTierStandardJul – Sept 2014 R-GPCD Eastern MWD728%130.7 City of Riverside728%135.3 Rubidoux CSD728%158.0 Western – Retail832%189.2 City of Corona832%194.3 Jurupa CSD832%198.6 EVMWD832%205.8 Lee Lake WD832%208.1 City of Norco936%224.3 Rancho California936%349.1 Coachella Valley WD936%475.1 Desert Water Agency936%416.0 www.emwd.org 13

14. EMWD Response to SWRCB Regulations Stage 4: Mandatory Outdoor Reduction Enforcement through Tiered Rates o Tier 3 allocation is eliminated – Tier 4 rate for all over-allocation usage. o Tier 2 (outdoor) allocation reduced by 10 percent o Changes immediate, appeared on bills dated after July 1, 2015 o Customers within their reduced water budgets will see no financial impacts Simple Message to Our Customers: Reduce outdoor irrigation use by 50 percent EMWD is mandated to reduce water usage by 28 percent. In response EMWD moved to Stage 4 of its Water Shortage Contingency Plan. www.emwd.org 14

15. Example of Customer Impact Customer 1 (Wasteful)Customer 2 (Efficient) Tier Usage (BU) Water Rate Water Cost Tier Usage (BU) Water Rate Water Cost Without Stage 4 Indoor8$1.79$14.34 Indoor8$1.79$14.34 Outdoor13$3.28$43.28 Outdoor11$3.28$36.08 Excessive9$5.88$52.91 Excessive$5.88$0.00 Wasteful$10.76$0 Wasteful$10.76$0.00 Total$109.91 Total$50.42 With Stage 4 Indoor 8 $1.79$14 Indoor8$1.79$14.34 Outdoor 12 $3.28$39 Outdoor11$3.28$36.08 Excessive$5.88$0 Excessive$5.88$0 Wasteful 10 $10.76$108 Wasteful$10.76$0 Total$161.00 Total$50.42 www.emwd.org 15

16. Conservation Outreach and Education Programs Annual Budget: Over $3 million Message pathways include: o Mailers, door hangers, phone calls, radio, television, newspaper, local program advertisements, community events, e-mail, website, programs in schools, business partnerships, billboards and community banners, bill messages, social media, water-wise landscape signage, fleet vehicle magnets and theater slides Over 2,500 hours per month dedicated to Conservation Education and Outreach 18 full-time staff members dedicated at least half-time: o In addition, for FY 2015-16, added 2 permanent full-time employees and 10 temporary full-time employees o Most materials available in Spanish; 15 customer service representatives and 4 conservation staff members speak Spanish www.emwd.org 16

17. Customer Outreach “Let’s Get Serious About the Drought” Customer Resources and Outreach o Newsletters/factsheets/Cable TV slides/Telephone and lobby messaging o Letters to customers in current Tiers 4,3, and higher-use Tier 2 (11,800 recipients) o Bill estimators and bill messages o Social media / e-mail ( eBlasts to 35,000 email subscribers) o June results letter to customers (138,000 recip.) Community Events: o EMWD has presented at 58 community events since April 1, to a combined audience of more than 4,800 people www.emwd.org 17

18. Water Waste Enforcement Enforcement Staff: o 3 FTEs (120 hours/week) Monthly Enforcement Budget: $55,000 Reporting Mechanisms o Phone: Water Waste Hotline 951-928-3777 ext. 3306 o Email: c onservation@emwd.org o Website: www.emwd.org/ www.emwd.org/ o Mobile Application: EMWD Water Waste Reporter Conservation parkway patrolling on highways – Cited 20 locations/services www.emwd.org 18 Fining Structure: One warning letter is issued A second violation results in fines: –$50 for residential customers –$200 for commercial customers EMWD staff must witness violation in order to issue a fine Offering mandatory EMWD training classes in- lieu of paying fines: –“Traffic school” approach –Customers with financial hardship

19. Progress Toward State Mandated Conservation Standards – Inland Empire Water Suppliers www.emwd.org 19 AgencyTier Conservation Standard June 2015 ActualDifference Rancho California WD936%14%-22% Coachella Valley WD936%21%-15% Western MWD (Retail)832%17%-15% Elsinore Valley MWD728%14%-14% Rubidoux CSD728%14%-14% EASTERN MWD728%15%-13% City of Norco936%28%-8% City of Corona728%21%-7% City of Riverside728%22%-6% Lee Lake WD832% -1% Jurupa CSD728%30%2% Desert Water Agency936%40%4% Lake Hemet WD728%35%7% 1 st Month of Reporting under new Conservation Standards: June 2015

20. SWRCB Information Order On July 29, EMWD was notified it “missed its target conservation requirement by a significant margin” and would be receiving a Notice of Violation under separate cover. The State Board invited EMWD to meet to “provide compliance assistance and help the District avoid future enforcement actions”. List of 16 questions was provided for EMWD to address. Meeting occurred August 6, 2015. Subsequent Conservation Order not issued based upon progress. www.emwd.org 20

21. EMWD Progress: May – July 2015 www.emwd.org 21 Record breaking temperatures - June 2015 was the hottest June on record

22. Prior Conservation Not Considered When Establishing Restrictions www.emwd.org 22

23. Going Forward – Emergency Regulations What have we learned? Agencies and areas in the State with minimum pre-2013 conservation initiatives perfromed incredibly well. Initial Emergency Regulation framework concerns should be correlated with compliance metrics to determine adjustments. Emergency regulations beyond February of 2015 should be more sophisticated and incorporate these verified adjustments: o Pre-2013 and 2013-2015 conservation results and demand hardening. o Past “drought proof” investments (recycling, desalination, etc.) and demand shifting. o Weather normalization (climate) and variations in land use density. Enforcement should continue to be flexible and recognize “good faith” efforts and the limited complexity of the existing regulations. www.emwd.org 23

24. Contact Information EASTERN MUNICIPAL WATER DISTRICT Paul D. Jones II, P.E. General Manager (951) 928-6130 jonesp@emwd.org www.emwd.org 24

25. Christian M. Carrigan Director, Office of Enforcement State Water Resources Control Busted by the State for Drinking Too Much: Enforcement of the Emergency Conservation Regulations 25

26. Enforcement of the Emergency Conservation Regulations 26 Water Supplier Conservation Compliance June 2015 266 16 70 53 Compliance Priority

27. Enforcement of the Emergency Conservation Regulations 27 Water Supplier Conservation Compliance July 2015 290 4 49 59 Compliance Priority

28. Enforcement of the Emergency Conservation Regulations 28 Water Supplier Conservation Compliance June-July 2015 16 4 70 49 53 59 266 290

29. Enforcement of the Emergency Conservation Regulations 29 PriorityDescription Number of Suppliers Details 1More than 15% from meeting standard15 Each priority 1 supplier received a Notice of Violation and Informational Order and met with State Water Board staff to assess the circumstances preventing the supplier from achieving their conservation standard. Some of the 15 suppliers will receive Conservation Orders. Additional details will be available soon. Sample Notice of ViolationSample Notice of Violation Sample Informational Order Sample Conservation Order Actions 25% - 15% from meeting standard 69 Each priority 2 supplier was sent a Notice of Violation and Informational Order on 8/7/15. Priority 2 suppliers have until 8/19/15 to provide information on water production, water use, and water conservation efforts. Sample Notice of ViolationSample Notice of Violation Sample Informational Order 31% - 5% from meeting standard 55 Warning letters were sent to priority 3 suppliers on 8/11/15. Sample Warning LetterSample Warning Letter 0Met or within 1% of meeting standard273The State Water Board congratulates the 273 suppliers that met, or were within one percent of meeting, their conservation standard.

30. Enforcement of the Emergency Conservation Regulations 30 Sample Information Orders 1.Describe any and all actions approved by your governing board since April 1, 2015, to increase conservation. 2.Does your agency have conservation programs that specifically target the following customer classes? (Residential – Single Family, Residential – Multi-Family, Commercial, Industrial, Institutional) 3.Does your agency have an active leak detection and repair program? 4.Does your agency run conservation outreach and education programs? 5.Does your agency run any conservation programs jointly with other entities?

31. Enforcement of the Emergency Conservation Regulations 31 Sample Information Orders 6.Does your agency run any appliance rebate programs? 7.Does your agency run any water efficient landscape programs? 8.Does your agency have personnel dedicated to water waste enforcement? 9.Which type of rate structure does your agency use for residential customers? 10.Has your agency instituted any type of drought rate or pricing since June 1, 2014?

32. Enforcement of the Emergency Conservation Regulations 32 Sample Information Orders 11.What rates and pricing mechanisms are used to incent conservation by non-residential customers? 12.When was the last time your agency modified its rate structure? 13.What is your agency’s billing frequency? 14.Provide a complete copy of your agency’s rate/tariff 15.Provide a complete copy of your agency’s conservation ordinance/rules 16.Are all your residents on water meters?

33. Enforcement of the Emergency Conservation Regulations 33 Sample Conservation Order Actions ( tailored to local needs and conditions) (A) Limit outdoor irrigation to no more than two days per week, before [time] or after [time] for all customers; (B) Identify and contact the top 100 water users, by volume, regarding opportunities to reduce water use by [date]; (C) Conduct [x] audits of CII (commercial, industrial, institutional) customers per month for the next [x] months. CII audits must include recommendations for water conservation actions and provide a timeline for implementing audit recommendations;

34. Enforcement of the Emergency Conservation Regulations 34 Sample Conservation Order Actions (D) Increase education and outreach on [specific topic] including, but not limited to the following: i) Develop and send out a mailer on [specific topic] by [date]; ii) Make [x] phone calls per month for the next [x] months to educate customers on [specific topic]; and iii) Add [specific topic] information to [water supplier] website and bills by [date]. (E) Increase the number of dedicated conservation personnel hours by [x] hours per week; (F) Investigate potential partnership opportunities (rebates, low-flow fixtures, etc.) with [energy company(s)] by [date]; (G) Investigate the possibility of a drought surcharge by [date]

35. Christian M. Carrigan Director, Office of Enforcement State Water Resources Control (916) 342-5889 cris.carrigan@waterboards.ca.gov Enforcement of the Emergency Conservation Regulations

36. 36

37. Enforcement of the Emergency Conservation Regulations 37

38. Enforcement of the Emergency Conservation Regulations 38

39. Enforcement of the Emergency Conservation Regulations 39

40. Enforcement of the Emergency Conservation Regulations 40 Does close equal compliance?

41. Enforcement of the Emergency Conservation Regulations 41 Question?

42. Gregory J. Newmark Principal, Meyers Nave Chair, Drought Response Team 213.626.2906 gnewmark@meyersnave.com Enforcement of the Emergency Conservation Regulations 42