VALLEY CENTER MUNICIPAL WATER DISTRICT
Regular Board Meeting
Monday, September 15, 2008
Time: 2:00 P.M.
Place: Board Room
29300 Valley Center Road
Valley Center, CA 92082
The Valley Center Municipal Water District Board of Directors’ meeting was called to order by President Broomell at 2:00 P.M.
Board members present were: Directors Broomell, Polito, Stone and Haskell. Director Aleshire was absent. Staff members present were: General Manager Arant, General Counsel Cowett, District Engineer Grabbe, Director of Operations Hoyle, Director of Finance Jeffrey, Board Secretary Stetson, Project Manager Williams, Consumer Services Supervisor Tilley and IT Specialist Learue. Spectators present were: Messrs. Shields, Johnson, Bunts and Ayala.
APPROVAL OF AGENDA
The Board unanimously approved reordering the agenda to consider Agenda Item No. 7, Board Consideration of the Termination of Water Service – Pacific Paradise Nursery, to follow action on the consent calendar items.
1. Upon motion by Stone, seconded by Haskell and unanimously carried, the following consent calendar items were approved:
• Minutes of the Board meeting held September 2, 2008
• Audit demand check numbers 119676 through 119840
• Treasurer’s Report and Financial Statements for the period ended July 31, 2008
• Annual report of professional and consulting agreements and contracts in effect during Fiscal Year 2007-2008
2. Consideration of Termination of Water Service to Pacific Paradise Nursery:
The Board was apprised of the current status of Pacific Paradise Nursery’s account which has a grouped meter allocation under the Interim Agricultural Water Program. Notification had been sent by the District that termination of water service to Pacific Paradise Nursery would be considered by the Board at the August 4th meeting due to a repeated water usage over the account’s allocation even with a flow restrictor installed. At that time, the group account had exceeded its entire allocation for calendar year 2008.
In response to this notification, a meeting was held in mid-July with Mr. Randy Smith, owner of Pacific Paradise Nurseries. Mr. Smith at that time informed staff that his accountant had only recently informed him of the over-usage of his accounts within the IAWP Supply Reduction Plan and that the accounts were subject to termination of service. Mr. Smith had explained that upon notification of the over-usage, he has taken aggressive action to reduce his water consumption from the District that include drilling and reactivation of wells, selling of plant inventory and irrigation efficiency practices. In addition, an inactive meter was discovered with an IAWP allocation that was added to the group account which provided an increase in allocation. Mr. Smith was granted another month to bring the Pacific Paradise Nurseries’ usage within the to-date allocation.
Debbie Tilley, Consumer Services Supervisor, informed the Board that the Pacific Paradise Nursery group account’s water consumption has decreased as a result of Mr. Smith’s efforts to conserve and the drilling of wells for an alternate water source. Such changes will secure long-term water savings and the account is on track to be in compliance with the IAWP Supply Reduction Implementation Plan.
Recognizing the efforts implemented by the Pacific Paradise Nursery to achieve compliance with the 30% reduction for IAWP accounts, staff recommended a deferral of the consideration of termination of service and to continue to monitor the group account’s usage.
Upon motion by Stone, seconded by Polito and unanimously carried, the Board approved a deferral of consideration of the termination of Pacific Paradise Nursery’s accounts and directed staff to closely monitor the accounts for continued reduction in usage and to bring back the matter to the Board if over-usage so warrants.
3. Water Supply Update – Presentation from the San Diego County Water Authority:
Mr. Bob Yamada, Sr. Water Resources Manager of the San Diego County Water Authority, provided an update on the State’s and the San Diego Region’s water supply conditions. He reviewed a chart of the San Diego County Water Authority’s estimated
supply portfolio for 2008 which indicates a 72% dependence on Metropolitan Water District for imported water. He noted that in 1991, the region had been dependent on Metropolitan Water District for 95% of its water supply. The reduction in dependence on Metropolitan Water District is the result of the Authority’s policies and programs to diversify its water supplies. The SDCWA’s water supplies from the All American Canal, Coachella Canal and IID transfers will increase in the next couple of years, further diversifying the Authority’s supplies as well as an increase in recycled water.
Metropolitan Water District’s 2008 projected supply and demand balance was reviewed. The projected demand is 2.21 MAF for 2008 and its projected supplies are from the Colorado River aqueduct (871,000 ac. ft.), State Water Project (742,000 ac. ft.) and Water Supply Demand Management (WSDM) supplies (740,000 ac. ft. from surface storage, stored groundwater and water transfers). As such, a substantial amount of Metropolitan Water District’s supplies to meet demands will be from its reserves. Its storage reserves had been 2.2 MAF in January 2007 and are projected to decrease to 1.1 MAF in January 2009.
Mr. Yamada stated that Metropolitan Water District has engaged its member agencies in supply planning for 2009. One scenario is a 10% State Water Project allocation which would result in a shortfall for Metropolitan of 696,000 ac. ft. Metropolitan is proposing enhanced resources which are additional actions proposed on the Colorado River and State Water Project including securing supplies through land fallowing, transfers and enhanced conservation efforts. With the implementation of the enhanced resources, it is believed that more than 500,000 ac. ft. of additional water supplies would be generated leaving an approximate 180,000 ac. ft. shortfall under the 10% State Water Project allocation scenario. Under these conditions, it is projected that the San Diego County Water Authority will meet water demands through local and imported supplies as well as conservation efforts of 56,000 ac. ft. per year.
Drought response activities for the preparation of meeting water supply demands in 2009 include the development of Metropolitan Water District’s five-year plan, development of the San Diego County Water Authority’s five-year scenarios, development of a new demand offset framework and establishment of base period percentages for a San Diego County Water Authority allocation model.
4. Report on Lake Turner’s Photo-Voltaic Solar Power Project:
Project Manager Dennis Williams provided an update on the solar power project being constructed on the District’s Lake Turner property. He explained that the 1.1 megawatt photo-voltaic solar project will generate power to be transferred to the Betsworth Pump Station to offset electrical usage for operation of the pumps.
The solar project will encompass approximately 9 acres of the District’s Lake Turner property. An extensive grading project was undertaken to prepare the property for
the solar panels in which 20,000 yards of rock were generated. Some of the rock generated will be used as a structural fill and on the slopes. There will be 6,330 solar panels that will track the sun for maximum solar power. A retention basin has been constructed that will collect water run-off in which clear water will drain into Lake Turner. The photo-voltaic solar power project is expected to be completed by November 1, 2008.
5. Requests for Annexation from Pardee Homes and Pappas Investments:
General Manager Arant reported that requests to initiate annexation proceedings have been received from Pardee Homes (Meadowood Project) and Pappas Investments (Campus Park West).
The annexation requests raise several issues which were reviewed and are listed below:
▪ The requests received for consideration of annexation to the District will entail detachment from other water agencies; namely, the San Luis Rey M.W.D. for the Pardee Homes property and from both the San Luis Rey and Rainbow M.W.D.s for the Pappas Investments property.
▪ The San Diego County Water Authority’s policy has been that annexation of properties should not create service area islands which would result with annexation of the requesting properties to the District.
▪ A coordination of wastewater treatment and water reclamation services between the proponents of the annexation will be necessary to avoid having two treatment plants in close proximity to each other to reduce future District maintenance and operation costs.
▪ Assessment of the availability of imported water to serve the annexation property and current property, as during the processing period it is likely that mandatory water usage reductions will be in effect. The District’s adopted Water Supply Shortage Response Plan relating to annexation of property was reviewed. Within Levels 2 and 3 of the Water Shortage Response Plan, annexing properties must offset the net water demand impact for the project and provide .5 ac. ft. of additional supply per EDU. Under Level 2, this can be accomplished through development of its own supplies or participation in local and/or regional offset programs. However, under Level 3, properties requesting annexation must offset the net water demand impact from their projects by providing their own supply or participation in a local supply development program, but not through participation in local or regional offset programs. All annexation processing is terminated in Level 4. It was noted that both the local and regional offset programs have not as yet been developed.
The following recommendations regarding the request from Pardee Homes and Pappas Investments to initiate annexation proceedings of their properties to the District were presented by staff:
1. Receive and file the Pardee and Pappas annexation requests; and
2. Defer action on the requests until such time that both local and regional offset programs are established; and
3. Direct staff to facilitate the development of a regional offset program and further define and quantify local resource development and offset opportunities within the District’s service area; and
4. Advise Pardee and Pappas to consider the following actions:
▪ Pardee should further document, refine and finalize their report, “Meadowood – A Net Zero Water Community.”
▪ Pappas should begin the process of developing a similar analysis determining the net imported water demand for their proposed development.
▪ Pardee and Pappas should seek counsel with both MWD and SDCWA on those agencies’ respective positions on issuing Water Supply Assessments and general attitude toward processing large annexations under the current and pending water supply conditions.
▪ Pardee and Pappas should initiate discussions with San Luis Rey MWD and Rainbow MWD, as appropriate, to seek concurrence for detachment from those agencies.
▪ Pardee and Pappas should initiate discussions with properties lying between their properties and the existing District boundaries as to interest of those properties joining in the annexation process so as to achieve the service area contiguity as directed in the SDCWA Annexation Policy.
▪ Pardee and Pappas should, as appropriate, initiate discussions and planning on how to coordinate wastewater treatment and disposal facilities to jointly meet their respective needs, maximize the joint use of reclaimed water and other local non-potable sources, and construct facilities amenable to expansion to meet possible future needs in that area.
Mr. Thad Johnson of Pappas Investments, the owner of Campus Park West property, addressed the Board and provided a map of the proposed Campus Park West development. The 107 acre proposed residential, mixed-use, general commercial and limited industrial development is located east of I-15 near
Highway 76. Most of the Campus Park West Project’s property is located in the San Luis Rey M.W.D. service area with a small portion of the property in the Rainbow M.W.D. service area. Mr. Johnson stated he recognizes the current water situation and the need to sustain the region’s limited water supply through efficiency practices and development of local supplies. An initial analysis of water demands for the proposed Campus Park West development are 208 ac. ft. per year for 559 EDUs. The use of groundwater and reclaimed water will be maximized and a net water demand analysis for the proposed project will be further analyzed. The issue of a contiguous service area was discussed and will be explored with Pardee Homes to include other surrounding properties in the proposed annexation to the District.
Local and regional water demand offset programs will be developed and should be identified by mid-2009. Local programs being considered are expansion of existing reclamation projects, construction of a new reclamation plant and delivery of desal. water from the Poseidon Resources Desalination Project.
Mr. Jim Ayala of Pardee Homes stated that regarding detachment from the San Luis Rey and Rainbow Municipal Water Districts, such detachment had been approved by the subcommittee group for the proposed annexation and reorganization of the properties. Also, to address maintaining contiguous service area boundaries, the detached island properties could be included in the Sphere of Influence update as well as the detachment/annexation process. Mr. Ayala inquired as to the feasibility of proceeding at this time with the annexation request. Staff reiterated that as part of the annexation process there are several actions that the proponents can pursue at this time, but both the local and regional offset programs for net water demand offset requirements under the Water Supply Shortage Response Program have not yet been developed.
Upon motion by Polito, seconded by Stone and unanimously carried, the recommendations presented by staff as outlined previously pertaining to the requests from Pardee Homes (Meadowood Project) and Pappas Investments (Campus Park West). to initiate annexation proceedings were approved.
6. Local Agency Formation Commission 2008 Special Districts Election:
A mailed ballot election is being held for the San Diego Local Agency Formation Commission (LAFCO) Special Districts Regular Member with a term expiring in 2012 and for eight Special Districts Advisory Committee members with terms expiring in 2012. Two nominations for the Regular Member and nine nominations for the Advisory Committee positions were received. The nominating committee reviewed the nominations submitted and recommended Bud Pocklington of South Bay Irrigation District for the LAFCO Regular Member. The District’s vote (mail ballot) must be received by LAFCO by October 3rd and be cast by the District’s presiding officer or an alternate Board member.
Upon motion by Stone, seconded by Polito and unanimously carried, President Broomell was directed to cast the District’s vote for the LAFCO 2008 Special Districts Election.
GENERAL MANAGER’S AGENDA
7. Review of Miscellaneous Informational Items:
General Manager Arant reported on the following miscellaneous items:
▪ The District’s Status Report for August 2008 reports a total Metropolitan Water District and San Diego County Water Authority discount for participants in the agricultural program of $79,316,000 since June 1994. Water sales projections are close to budgeted figures for the current fiscal year.
▪ Information on the proposed phase-out and opt-out option for participants in Metropolitan Water District’s Interim Agricultural Water Program (IAWP) has been posted on the District’s web site. There is a strong likelihood that the MWD Board will take action at its October meeting to phase out the IAWP discount by 2013. As part of this action, current IAWP participants would be given the opportunity to “Opt Out” and become full price, firm customers, starting in January of 2009 and each January thereafter until the program is phased out in January 2013.
The status of the San Diego County Water Authority’s Special Agricultural Water Rate (SAWR) in the event that Metropolitan Water District approves the phase out of the IAWP discount is unknown. General Manager Arant stated that he has been working on the development of a white paper along with Keith Lewinger of the Fallbrook Public Utility District to support the continuation of the SAWR for growers who elect to remain in this program. Customers that receive the SAWR discount of $111/ac. ft. do not participate in the Authority’s Storage Charge, Melded Supply Rate and Melded Treatment Rate. In preserving the San Diego County Water Authority’s SAWR, there could be different classes of customers, including, Municipal & Industrial (full price, firm demand), SAWR discount only (in an emergency storage event receive 50% of supply and would not benefit from the canal lining projects or IID transfer water), and customers that continue in Metropolitan Water District’s IAWP and the Authority’s SAWR (subject to first and highest cutbacks from Metropolitan and emergency storage event cutback). Maintaining the Authority’s SAWR for those customers that opt-out of Metropolitan Water District’s IAWP and continuing the SAWR after phase-out of the IAWP will be pursued.
▪ Following discussion with Jeff Kightlinger, General Manager of the Metropolitan Water District, there will be an agreement for the continued provision of emergency water service from the District to the San Pasqual Indian Reservation that Metropolitan Water District will consider MWD supplies to the Reservation. The San Luis Rey Indian Water Rights Settlement Act that will provide the San Pasqual Indian Reservation with its needed water supplies is expected to be settled in one year. Upon the litigation settlement, a wheeling agreement will be executed for the delivery of the water.
GENERAL COUNSEL’S AGENDA
8. Litigation Addressing Delta Water Operations:
General Counsel Cowett reported that the biological opinion that will guide water operations on the Delta for protection of the Delta Smelt has been extended to December 15th. The biological opinion for the Chinook Salmon is due in March 2009.
9. A Closed Session was called by President Broomell at 4:10 p.m. pursuant to:
• Government Code §54956.8 – Real Property Transaction, Conference with
Negotiator to discuss lease of District lands for installation of solar
Property: 29300 Valley Center Road
Agency Negotiator: Gary T. Arant, General Manager and Sophie Akins,
Negotiating Party: Solar Electric Solutions
Under Negotiation: Terms of Lease
10. The Regular Board meeting was reconvened at 4:15 p.m. No action was reported.
11. Adoption of Resolution Making Findings Pursuant to Energy Services Contracting:
Upon motion by Polito, seconded by Haskell and unanimously carried, the following resolution, entitled:
RESOLUTION NO. 2008-34
RESOLUTION OF THE BOARD OF DIRECTORS OF
VALLEY CENTER MUNICIPAL WATER DISTRICT MAKING
FINDINGS REQUIRED FOR ENERGY SERVICES CONTRACTING;
APPROVING AN EXEMPTION UNDER THE CALIFORNIA
ENVIRONMENTAL QUALITY ACT; DIRECTING STAFF TO
FILE A NOTICE OF EXEMPTION; AND APPROVING PROJECT
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Stone and Haskell
ABSENT: Director Aleshire
12. Upon motion by Haskell, seconded by Stone and unanimously carried, the meeting was adjourned at 4:25 p.m.