1. CALAFCO 2007 Annual Conference SUSTAINABILITY LAFCO’s Role in Meeting the Challenge Wednesday, August 29, 2007 Hyatt Regency, Sacramento 2007 California Water Developments “Our Challenged Water Resources – A Serious Look at Sustainability”

2. Workshop Overview – Part I Landmark decisions – affecting water resources Implications to Southern California, Bay-Delta, source areas (Sierra Nevada) Potential Challenges and Strategies Climate change

3. Workshop Overview – Part II CKH guidance Water determinations Metrics used Compatibility with State/federal laws Flexibility and Liability Adaptive Management

4. Re-Cap of California Hydrology Two-thirds of precipitation in the Sierra and north Two-thirds of demand in south Majority precipitation in November-March Majority of demand in March-November

5. Re-Cap of California Hydrology Allocation and timing challenge Convergence of Sacramento – San Joaquin rivers Delta sensitivity

6. Delta Sensitivity Maintain Delta ecosystem health Delta smelt Salmon/steelhead migration Water quality objectives Water deliveries

7. 2007 Federal/State Events State Pumps shut down for 9 days in June Federal Pumps shut down this summer CVP-OCAP challenged –USFWS Biological Opinion for Delta Smelt –NOAA Biological Opinion for Salmon/Steelhead DMC Intertie/SDIP challenged Governor’s Delta Vision Committee (E.O. S-17- 6)

8. 2007 Federal/State Events (cont.) Bay-Delta Conservation Program/Plan Revisit – Peripheral Canal DWR – Drought Preparedness Workshops California Water Plan Update 2009 CVRWQCB – understaffed by one-third

9. Other Developments Westlands Water District – 1 MAF entitlement transfer Quantification Settlement Agreement (QSA) - Imperial Irrigation District/Coachella Valley Water District – Colorado River Ninth Circuit Court – Columbia River – take “recovery” into account on jeopardy determinations under the federal ESA

10. Legislative Developments AB 32 – Global Warming Solutions Act SB 59 - Reliable Water Supply Bond Act –Sites and Temperance Flat reservoirs AB 224 – Climate Change and Water Resource Protection Act –DWR to include climate change in all reports required under the Water Code

11. Legislative Developments (cont.) SB 27 – Sacramento/San Joaquin River Delta, Clean Drinking Water, Water Supply Security and Environmental Improvement Act of 2008 SB 732 – Prop 84 Bonds – fund projects related to water quality, flood control, waterway protection and climate change AB 1066 – Ocean Council – sea level rise information to OPR AB 1404 – joint water diversion and use reporting database

12. Current Conditions “Critically Dry-Year” in the San Joaquin R. watershed “Dry-Year” in the Sacramento R. watershed Reservoir inflows low Reservoir storages low – potential for low carryover Depleted reservoir coldwater pools Potential hydropower bypasses Emergency purchases/transfers Moratoriums on new services

13. Mid-August 2007 Status STORAGE IN MAJOR RESERVOIRS IN THOUSAND OF ACRE-FEET ReservoirCapacity15 Yr Ave.WY 2006WY 2007% of 15-Yr Ave. Trinity2,4481,9052,0571,81385 Shasta4,5523,1393,5362,28273 Oroville3,5382,4983,1221,97479 Folsom97761776942068 New Melones 2,4201,6052,2011,52495 Fed. San Luis 9662654408231 Millerton52029838920468 Total CVP11,3607,5309,0035,92179

14. Mid-August 2007 Status ACCUMULATED INFLOW FOR WATER YEAR TO DATE IN THOUSANDS OF ACRE- FEET ReservoirCurrent WY 2007 Driest WY 1977 Wettest WY 1983 15-Yr Ave.% of 15-Yr Ave. Trinity7152012,8331,52547 Shasta3,6732,30110,3766,22759 Folsom1,3813196,3142,94847 New Melones 53502,6681,17346 Millerton7983024,3931,86343

15. 2007 Reservoir Projections Projected Reservoir Storage through September 2007 in Thousands of Acre-Feet (Based on U.S. Bureau of Reclamation 90% EWA Water Operations Forecast) ReservoirCapacitySeptOctNovDecEnd of Year % of Full Trinity2,4481,3861,3141,2601,25251 Shasta4,5521,9081,8961,8661,99943 Folsom97726122920219220 New Melones 2,4201,4091,4101,4221,43459 San Luis9664815835456658

16. Ecosystem Trends – Delta Smelt

17. Ecosystem Trends – Delta Smelt, Longfin Smelt, and Striped Bass The Bay Institute Bay-Delt Plan Periodic Review Issue: Delta Outflow January 12, 2005

18. Ecosystem Trends – Winter-Run Chinook Salmon

19. Ecosystem Trends – X2 Upstream Migration The Bay Institute Bay-Delt Plan Periodic Review Issue: Delta Outflow January 12, 2005

20. Where are we today? Pelagic Organism Decline (POD) Unauthorized “take” at the State pumps CVP-OCAP uncertainty Coldwater pool decline Reduced deliveries to southern California Uncertain future hydrology

21. Climate Change Effects

23. Climate Change Effects - California What we are unsure of: Magnitude of change Temporal variability Spatial variability

24. Water Resource Implications Source area hydrology will likely change (snowpack, rainfall, runoff, ET, GW recharge) Water availability – total, spatial, seasonal Increased water transfers/wheeling New supplies Supply capture balanced with flood control Delta – will remain an important conveyance and ecosystem component Demands will continue to grow

25. What does this mean for LAFCo? Should acknowledge that:Should acknowledge that: –Water Supplies being Firmed Up –New Supplies being Explored –Difference between “paper” and “wet” water –Transfers occurring between Agencies –Delivery Constraints –North-South “equation”

26. LAFCo Mandates LAFCo required to review timely availability of adequate water supplies for any organization changeLAFCo required to review timely availability of adequate water supplies for any organization change –Gov’t Code §56668k Water Code §65352.5 LAFCo reviews extension of services outside of boundariesLAFCo reviews extension of services outside of boundaries –Gov’t Code §56133 (in vs. out of sphere) –LAFCo reviews services to previously unserved territory within unincorporated areas –Gov’t Code §56434

27. Water Supply Availability Surface Water Groundwater Recycled Water Demand Reduction Desalination

28. How real is the water supply? “Safe Yield” –Entitlement restrictions (contract, water right, third party agreement) –Has it been “perfected”? Long-term or temporary –Shortage provisions –Constrained by storage capability –Constrained by reservoir operational rules –Shared beneficial uses (hydropower, recreation, etc.) –Seasonal use restrictions –Would it offset or delay other customers already within the service area?

29. Example Federal Water “Shortage Policy” –100,000 AFA M&I Contract –Ave. Historical Use – 50,000 AFA –Maximum current cutback – to 37,500 AFA (Dry Year) –Maximum ultimate cutback – to 75,000 AFA

30. Example Water Rights – Terms and Conditions –Minimum bypass flow requirement –Water right – 100 cfs –Fish bypass flows – 25 cfs (May-June) –Fish bypass flows – 35 cfs (May-June) in Dry Years

31. Example Water Rights - Recreational Flows –Water right of 500 cfs –Recreational flows – no diversions upstream of Point (May-September) –Requirement for increased releases during specific periods

32. Example Water Rights – Need for Implementation Approval –50,000 AFA water right –Federal facilities required to take water –Have yet to secure a federal Warren Act contract (wheeling agreement)

33. Example Third Party Agreements –e.g., Sacramento Water Forum –62,000 AFA total entitlement –54,900 AFA wet-year diversion –39,000 AFA voluntary cutback in dry-years

34. Example New Infrastructure Improvement –Folsom Dam and Reservoir –Joint Federal Project –FDS/FDR –New Flood Encroachment Curve –Effects on long-term carryover for Folsom water supply

35. Example Changing Rules for CVP/SWP and Delta Operations –Long-term prescriptions? –Exports –In-Delta standards –COA –Term 91 (balanced conditions) –Accommodations for flood control –Climate change effects

36. Can the supply be accessed? Is it in a readily accessible reservoir? Are diversion/conveyance improvements necessary? Does adequate treatment capacity exist? What is the status of the purveyor’s distribution infrastructure? Are there water quality concerns?

37. Other Issues? Cross-county coordination? “First-come/First Served” edict still appropriate? Prior rights? By approving a certain annexation; are we acceding to a water supply alternative with greater environmental effects?

38. What form of assurance is appropriate? Verbal commitment “Will serve” letter Development Agreement Others?

39. Options for Water Supply and Infrastructure Verification Accept as is… Request explanation and discussion Defer to published information Perform internal assessment Seek third party review

40. Are determinations perpetual? Are LAFCo determinations unchangeable? What happens if: –Water supply availability was over-estimated? –Water delivery proves unreliable? –Changes in federal/State regulations? –Current project shown to adversely affect historic customers (e.g., WQ, reduced reliability)? –Financing for required CIPs are delayed?

41. Can LAFCos Condition Approvals? Could a LAFCo: –Require periodic monitoring and reporting? –Review established milestones – to re-verify facts? –Include Re-Opener clauses in agreements? –Amend certain Terms and Conditions of Determinations? –Seek mitigative remedies? –Thereby: adopt Adaptive Management principles in the discharge of duties under CKH?

42. Liability Concerns Who bears the burden of liability if: –Water supply information inadvertently omitted important data? –New information proves a previous LAFCo determination inaccurate? –It is shown that an approved delivery (through annexation) could trigger adverse effects under federal law (e.g., Endangered Species Act)

43. Liability Concerns (cont.) –It is shown that an approved delivery (through annexation) could trigger adverse effects to other existing residents? –Project timing is delayed because certain approvals have not been secured by the water purveyor? –Conveyance failure occurs? –Development project has to de-mobilize?

44. Open Discussions

45. Follow-Up Actions? Findings? Recommendations? CALAFCO?

46. THANK YOU! 2007 California Water Developments “Our Challenged Water Resources – A Serious Look at Sustainability” Robert Shibatani Consulting Hydrologist and Water Industry Advisor PBS&J RSShibatani@pbsj.com