HomeMy WebLinkAbout2001-04-03; Municipal Water District; Resolution 11211
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3 RESOLUTION NO. ‘12’
4 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE
5 CARLSBAD MUNICIPAL WATER DISTRICT SUPPORTING LEGAL CLARIFICTION OF PREFERENTIAL RIGHTS UNDER SECTION 135
6 OF THE METROPOLITAN WATER DISTRICT ACT
7 II WHEREAS, the San Diego County Water Authority (“Water Authority”) provides
8 wholesale water service to 23 member public agencies in the San Diego region ; and
9 WHEREAS, the Water Authority has responsibility to provide imported water supplies to
10 meet the needs of the region’s $103 billion economy and to sustain the quality of life of the
11 region’s nearly three million people; and
12 WHEREAS, the Carlsbad Municipal Water District depends and relies upon the Water
,3 Authority to provide all or a substantial portion of its water supply needs; and
14 WHEREAS, the Water Authority is a member agency of the Metropolitan Water District of
Southern California (“MWD”) and is currently dependent on it for all of the water supply it imports
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to serve the needs of the Water Authority’s own members including the Carlsbad Municipal
16 Water District; and
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WHEREAS, over fifty years MWD has promised, assured and represented to the Water
Authority and the public it serves that it would provide them with sufficient water to meet their
19 stated needs; and
20 WHEREAS, in good faith reliance on MWD’s past assurances, the Water Authority
21 expanded its territory, built public works and made its own assurances that it would provide the
22 San Diego region with a reliable supply of water; and
23 WHEREAS, the Carlsbad Municipal Water District has relied upon the assurances of a
24 continuing and reliable water supply from the Water Authority and MWD for the adoption and
implementation of a comprehensive, long-term general plan for the development of its
25 community; and
26 WHEREAS, MWD was created under the Metropolitan Water District Act (“the MWD
27 Act”); and,
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WHEREAS, Section 135 of the MWD Act establishes a “preferential right” to MWD’s
water supplies for each of MWD’s 26 member agencies based on each agency’s payment of
MWD’s capital costs and operating expenses; and
WHEREAS, as currently interpreted and applied by MWD, a member agency’s
preferential right to water under Section 135 bears no relationship to its payment of MWD’s
capital costs and operating expenses or to its stated water needs; and
WHEREAS, MWD’s interpretation and application of Section 135 is inconsistent with its
own promises, assurances and representations to provide water to meet the Water Authority’s
stated needs; and
WHEREAS, through June 30, 2000, the Water Authority has paid MWD nearly $3 billion
to pay the capital costs and operating expenses of MWD water works, representing twenty-two
percent (22%) of all member agencies’ total historical payments to MWD; and
WHEREAS, of this amount, only $514 million is counted by MWD in its calculation of the
Water Authority’s preferential right under Section 135, resulting in an entitlement to less than
fifteen percent (15%) of MWD’s water supply; and
WHEREAS, this calculation leaves the Water Authority with a preferential right to less
than one-half of the water supply it purchases, year in and year out, from MWD-a shortfall of
about 300,000 acre feet of water; and
WHEREAS, by way of contrast, through June 30, 2000, the City of Los Angeles’ has paid
MWD approximately $1.6 billion to pay the capital costs and operating expenses of MWD water
works, representing twelve percent (12%) of all member agencies’ total historical payments to
MWD; and
WHEREAS, of this amount, $792 million is counted by MWD in its calculation of Los
Angeles’ preferential right under Section 135, resulting in an entitlement to more than twenty-two
(22%) of Metropolitan’s water supply; and
WHEREAS, this calculation leaves the City of Los Angeles with preferential right to about
two times as much water as its regular water purchases from MWD; and
WHEREAS, the City of Los Angeles claims that its right to purchase water from MWD is
governed by Section 135 as currently interpreted and applied by MWD, and may be exercised at
any time, in the sole discretion of Los Angeles, notwithstanding the availability to it of alternative
water supplies and irrespective of any resulting reductions in supplies delivered to the Water
/I Authority’; and -.
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WHEREAS, MWD’s current revenue policies and programs allocate MWD’s capital costs
and operating expenses as though Section 135 rights do not exist, thus leaving the Water
Authority with the obligation to pay the capital costs and operating expense of water supplies that
are subject to claims by Los Angeles; and
WHEREAS, past payments by the Water Authority to MWD pale in comparison to the
future revenues and indebtedness that are projected to meet the water supply demands of MWD
~ member agencies, in excess of $4 billion over the next 20 years; and
I WHEREAS, the Water Authority has made numerous efforts to resolve the dispute over
, preferential rights through MWD board processes and committees, mediations and facilitations
over the years, all without success; and
WHEREAS, the Water Authority has filed an action in the San Diego Superior Court
(Case No. GIC 761526) in an effort to finally resolve the controversy and achieve certainty as to
its MWD supply reliability and costs:
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Carlsbad
Municipal Water District, as follows:
1. That the above recitations are true and correct.
2. That the Carlsbad Municipal Water District hereby expresses its support of the actions
taken by the San Diego County Water Authority to seek legal clarification of
preferential rights under Section 135 of the Metropolitan Water District Act;
3. That the Carlsbad Municipal Water District hereby urges MWD, in the interest of
fairness, to remain neutral in this dispute between and among its member agencies;
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4. The Secretary shall send this resolution to the Water Authority and to MWD for due
consideration.
PASSED, APPROVED AND ADOPTED at a special meeting of the Board of Directors of
the Carlsbad Municipal Water District held on the 3rd day of April , 2001 by
the following vote, to wit:
AYES: Board Members Lewis, Kulchin, Finnila, Nygaard and Hall.