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HomeMy WebLinkAbout1996-07-16; Municipal Water District; 335; Update of the Proposed Water Transfer.- .-- CARLSBAD MUNICIPAL WATER DISTRICT - AGEN AB# 33s TITLE: UPDATE OF THE PROPOSED WATER MTG. 07/l 6196 TRANSFER BETWEEN THE SAN DIEGO COUNTY WATER AUTHORITY (CWA) AND DEPT. CMWD THE IMPERIAL IRRIGATION DISTRICT (IID) )A BILL - DEPT. HD. CITY ATTY. CITY MGR. +k RECOMMENDED ACTION: This is an informational item only. No action requested. ITEM EXPLANATION: In February 1996, staff presented an update to the Board on the potential plans for water transfer between the San Diego County Water Authority (CWA) and the Imperial Irrigation District (IID). The CWA and IID entered into a Memorandum of Understanding (MOU) to develop a water transfer agreement for up to 500,000 acre feet of water from the Imperial Valley. This MOU is supposed to detail the amount of water to be transferred, the terms of the agreement, the price of the water to be transferred and an enforcement mechanism. New Aqueduct Alternative The CWA has investigated the feasibility of transferring water from the Imperial Valley to the San Diego area. There are two potential alternatives. If the amount of water transferred is about 400,000 to 500,000 acre feet per year, it may be feasible to construct a new aqueduct from Imperial Valley to the San Diego area. The CWA has hired a consultant to determine the preliminary feasibility and approximate cost of a new aqueduct. The consultant studied several possible routes and has determined a range of costs from 1.9 billion dollars to 3.5 billion dollars for the construction. If a new aqueduct is constructed, the alternate selected would probably deliver water to the South County portion of the San Diego area. If this is the case, then it would be logical to bring the water into the San Vicente Reservoir which would act as a terminus reservoir. In order to get water to North County, the water would have to be pumped through very large pumps. This water would not be treated water. Since the CWA is not planning to treat this water, the “treated water agencies”(such as Carlsbad) would continue to receive treated water from the Metropolitan Water District (Met). “Wheeling “ Alternative Usins the Colorado River Aqueduct (CRA1 If the amount of water to be transferred is significantly less than the 400,000 to 500,000 acre feet per year, it would not be feasible to transport this water through a new aqueduct because the cost per acre foot would be prohibitive. A. better solution, in CWA’s view, would be the “wheeling” of this water through the existing Colorado Aqueduct. When approached with the question of what this wheeling charge would be, Met and the CWA had substantial differences as to the calculation of this proposed “wheeling” charge. Should the CWA be successful in obtaining a water transfer agreement with IID, the water purchases from Metropolitan could be substantially reduced thereby decreasing the revenue necessary to fund Met’s capital improvement program, a program that would still benefit the CWA, as well as the other Met agencies. As a result, the CWA made a proposal to Metropolitan at a special Board of Directors meeting on April 30, 1996. A summary of that proposal is as follows: Page 2 of Agenda Bill No. (3 3 5 + Authority commits to purchase from Met a minimum of 400,000 acre foot per year. + Commencing after 2010, Authority would deliver to Met for transport through the CRA up to an additional 200,000 acre feet per year in exchange for delivery by Met of equivalent amounts on a space-available basis. + Cost of exchange water delivery is variable because fixed costs should be covered by annual “requirement” purchases and Met “premium” water charges. + Met would put in place contracts for agricultural water discounts. + Met would support Authority transfer facility and Authority willingness to discuss storage opportunities. + Support for River re-operation and banking per California position. + Provisions for dispute resolution. Resolution of Issues These and other issues have caused difference of opinion between CWA and Met, and must be addressed in order for the proposed water transfer to be successful. In addition, there are concerns that member agencies of the CWA have that must also be addressed so that an informed decision concerning the proposed water transfer can be made. CMWD staff continues to have some concerns and questions that must be addressed as well. Some of these are as follows: + Should IID water transfer prove to be viable, facilities probably would be constructed to bring water into South County. As a result, this water would have to be pumped to North County member agencies. However, the water would not be treated and therefore Carlsbad would, continue to receive treated water from Met. It would appear that Carlsbad would have to pay for the capital program for Met and for the CWA which would include the IID water transfer project, although Carlsbad would receive no direct benefit from the water transfer. + Should the IID water transfer prove viable, the amount of water purchased from IID plus the supplemental water purchased from Met would provide 100% reliability. Will CWA continue to provide incentives (e.g., rebates, etc.) to member agencies for the continued development of local supplies such as reclaimed water2 Since Carlsbad is ready to embark on a $20 million Phase 2 of its reclaimed water master plan, the present program of rebates from CWA and Met are needed to make the project feasible. Page 3 of Agenda Bill No. 235 + The proposed water transfer from IID is estimated to cost from $1.9 billion to $3.5 billlion. This does not include the cost of purchasing the water from IID. The Emergency Storage Project (ESP) is estimated to cost $525,000,000. With Carlsbad’s ultimate water usage calculated at approximately 3.4% of CWA’s total water sales, Carlsbad’s share of the capital costs would amount to over $80,000,000. These costs do not include the costs of operation and maintenance nor the interest for financing these projects. What is the total estimated cost per acre foot for these projects? + Should CWA enter into an agreement with IID, it is anticipated that the term of this agreement will be for a 50 to 100 year period. Is it wise to commit to an agreement for this long term given the possibility that desalination may become less costly than the water transferred from IID? For the upcoming Board meeting of July 23, 1996, staff has arranged for Mark Watton, Board Chairman of the CWA and a Met Director, to be present to make a presentation to the Board on this subject. The information in this agenda bill is to inform the Board in advance of some of these issues and to provide a basis for discussion of the concerns and questions to be addressed at the July 23 meeting. FISCAL IMPACT: There is no fiscal impact. EXHIBITS: None.