HomeMy WebLinkAbout2021-05-12 Utilities Advisory Commission Agenda PacketMATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE COMMISSION AFTER DISTRIBUTION OF THE AGENDA PACKET ARE
AVAILABLE FOR PUBLIC INSPECTION ON THE UTILITIES ADVISORY COMMISSION WEBPAGE.
AMERICANS WITH DISABILITY ACT (ADA)
Persons with disabilities who require auxiliary aids or services in using City facilities, services or programs or who would like information on the City’s
compliance with the Americans with Disabilities Act (ADA) of 1990, may contact (650) 329-2550 (Voice) 24 hours in advance.
NOTICE IS POSTED IN ACCORDANCE WITH GOVERNMENT CODE SECTION 54954.2(a) OR 54956
Supporting materials are available online at https://www.cityofpaloalto.org/gov/boards/uac/default.asp on Thursday, 5 days preceding the
meeting.
****BY VIRTUAL TELECONFERENCE ONLY****
Join Zoom Webinar Here Meeting ID: 966 9129 7246 Phone: 1 (669) 900-6833
Pursuant to the provisions of California Governor’s Executive Order N-29-20, issued on March 17, 2020, to prevent
the spread of COVID-19, this meeting will be held by virtual teleconference only, with no physical location. The
meeting will be broadcast on Cable TV Channel 26, live on Midpen Media Center at https://midpenmedia.org.
Members of the public who wish to participate by computer or phone can find the instructions at the end of this
agenda.
I.ROLL CALL
II.AGENDA REVIEW AND REVISIONS
III.ORAL COMMUNICATIONS
Members of the public are invited to address the Commission on any subject not on the agenda. A reasonable time restriction may
be imposed at the discretion of the Chair. State law generally precludes the UAC from discussing or acting upon any topic initially
presented during oral communication.
IV.APPROVAL OF THE MINUTES
Approval of the Minutes of the Utilities Advisory Commission Meetings held on April 7 and 21, 2021
V.UNFINISHED BUSINESS - None
VI.UTILITIES DIRECTOR REPORT
VII.NEW BUSINESS
1.Discussion and Update on Recent Utilities Outages Discussion
2.Staff Recommends That the Utilities Advisory Commission Recommend the City Council Adopt Action
Resolutions Approving the 2020 Urban Water Management Plan and the Water Shortage
Contingency Plan
3.Staff Recommendation That the Utilities Advisory Commission Recommend the City Action
Council Adopt the Proposed Operating and Capital Budgets for the Utilities Department
for Fiscal Year 2022
VIII.COMMISSIONER COMMENTS and REPORTS from MEETINGS/EVENTS
IX.FUTURE TOPICS FOR UPCOMING MEETINGS: June 2, 2021
UTILITIES ADVISORY COMMISSION – SPECIAL MEETING
WEDNESDAY, May 12, 2021 – 5:00 P.M.
ZOOM Webinar
Chairman: Lisa Forssell Vice Chair: Lauren Segal Commissioners: Michael Danaher, Donald Jackson, A.C. Johnston, Greg Scharff, and Loren Smith Council Liaison: Eric Filseth
MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE COMMISSION AFTER DISTRIBUTION OF THE AGENDA PACKET ARE
AVAILABLE FOR PUBLIC INSPECTION ON THE UTILITIES ADVISORY COMMISSION WEBPAGE.
AMERICANS WITH DISABILITY ACT (ADA)
Persons with disabilities who require auxiliary aids or services in using City facilities, services or programs or who would like information on the City’s
compliance with the Americans with Disabilities Act (ADA) of 1990, may contact (650) 329-2550 (Voice) 24 hours in advance.
SUPPLEMENTAL INFORMATION - The materials below are provided for informational purposes, not for action or
discussion during UAC Meetings (Govt. Code Section 54954.2(a)(3)).
Informational Reports 12-Month Rolling Calendar Public Letter(s) to the UAC
• Informational Update on REC Exchange Program for 2021 in Accordance With the City's Amended Electric
Supply Portfolio Carbon Neutral Plan
• Informational Update on City of Palo Alto Utilities Electric Vehicle Programs
• Informational Report on Not-Activation of the Hydro Rate Adjuster for FY 2022, and Projections for Future
Hydrologic Scenarios
MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE COMMISSION AFTER DISTRIBUTION OF THE AGENDA PACKET ARE
AVAILABLE FOR PUBLIC INSPECTION ON THE UTILITIES ADVISORY COMMISSION WEBPAGE.
AMERICANS WITH DISABILITY ACT (ADA)
Persons with disabilities who require auxiliary aids or services in using City facilities, services or programs or who would like information on the City’s
compliance with the Americans with Disabilities Act (ADA) of 1990, may contact (650) 329-2550 (Voice) 24 hours in advance.
PUBLIC COMMENT INSTRUCTIONS
Members of the Public may provide public comments to teleconference meetings via email,
teleconference, or by phone.
1. Written public comments may be submitted by email to UACPublicMeetings@CityofPaloAlto.org.
2. Spoken public comments using a computer will be accepted through the teleconference meeting.
To address the Commission, click on the link below for the appropriate meeting to access a Zoom-
based meeting. Please read the following instructions carefully.
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browser, make sure you are using a current, up-to-date browser: Chrome 30+, Firefox 27+,
Microsoft Edge 12+, Safari 7+. Certain functionality may be disabled in older browsers
including Internet Explorer.
B. You will be asked to enter an email address and name. We request that you identify
yourself by name as this will be visible online and will be used to notify you that it is your
turn to speak.
C. When you wish to speak on an agenda item, click on “raise hand.” The Attendant will
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D. When called, please limit your remarks to the time limit allotted.
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3. Spoken public comments using a smart phone use the telephone number listed below. When you
wish to speak on an agenda item hit *9 on your phone so we know that you wish to speak. You will
be asked to provide your first and last name before addressing the Council. You will be advised how
long you have to speak. When called please limit your remarks to the agenda item and time limit
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Meeting ID: 966-9129-7246
City of Palo Alto (ID # 12261)
Utilities Advisory Commission Staff Report
Report Type: New Business Meeting Date: 5/12/2021
City of Palo Alto Page 1
Summary Title: Utilities Outage Update
Title: Discussion and Update on Recent Utilities Outages
From: City Manager
Lead Department: Utilities
Executive Summary
Providing reliable utilities service is a top priority for the Utilities Department, and crews work
daily to maintain and improve the system lines and operations. When service is disrupted due to
a planned or unplanned event, the Department seeks to ensure customers have accurate, timely
information about what is going on, any actions you should take at home or at work to assist,
and when service will be restored.
Recent outages have strained Utilities systems both on how customer inquiries are handled
when they call in to report an outage, and how quickly staff is able to share details with
customers about an outage and potential restoration timeframes. While recent outages were
unrelated to each other, they nonetheless provided lessons to improve our responses in the
future.
Improvements are underway to operational procedures, timeliness of public communication,
and customer call handling as a result of these outages. Limited staffing resources are being
addressed. In addition, changes to the existing outage system for quicker proactive notifications
are implemented as of this message and details can be found below.
Attachments:
•Attachment A - Presentation
Staff: Dean Batchelor
CITY OF
PALO
ALTO
Re cent Utilities Power Outages
May 12, 2021 www.cityofpaloalto.org
Attachment A
•
CITY OF
PALO ALTO
2
Recent Outages
q On March 27,2021, a power outage occurred impacting
approximately 7,000 customers for about two hours
q On April 4,2021, a power outage occurred impacting
approximately 570 customers for about four hours,though a
few were without power overnight
q On April 13,2021 a power outage occurred impacting
approximately 2,000 customers
A c1rv OF
~~PALO ALTO
3
Causes
q This outage involved a fa iled preventative maintenance
project at a substation,which was the result of an
inadequate level of coordination between staff and the
contractor
q This outage involved a blown transformer
q This outage involved a failed underground cable
A c1rv OF
~~PALO ALTO
4
Improvements Underway
q Evaluating electrical system and outage data to identify any
unexpected issues
q Conducting a third-party review of existing systems and
procedures
q Hiring additional operators and conducting additional
training
q Improving timely public communications during outages
q Evaluating upgrades to the City ’s outage management
system including automated outbound calling
q Reviewing the organization of utility operations and
engineering
A c1rv OF
~~PALO ALTO
Dean Batchelor
Director
Dean.Batchelor@CityofPaloAlto.org
650.496.6981
CI TY OF
PALO
ALTO
City of Palo Alto (ID # 12049)
Utilities Advisory Commission Staff Report
Report Type: New Business Meeting Date: 5/12/2021
City of Palo Alto Page 1
Summary Title: 2020 Urban Water Management Plan
Title: Staff Recommends That the Utilities Advisory Commission Recommend
the City Council Adopt Resolutions Approving the 2020 Urban Water
Management Plan and the Water Shortage Contingency Plan
From: City Ma nager
Lead Department: Utilities
REQUEST
Staff requests the Utilities Advisory Commission (UAC) recommend the City Council adopt a
resolution (Attachment A Linked Document) approving the 2020 Urban Water Management
Plan and a resolution (Attachment B Linked Document) adopting the Water Shortage
Contingency Plan.
EXECUTIVE SUMMARY
Every urban water agency in California is required to submit an Urban Water Management Plan
(UWMP), which includes a Water Shortage Contingency Plan (WSCP) (Attachment C Linked
Document) every five years. UWMPs must include information about water demand, water
supply, demand management activities, alternative water supplies, anticipated shortages
during dry periods, and contingency plans for addressing those shortages.
The City of Palo Alto’s (City or Palo Alto) demand for water is expected to increase over the next
25 years based on projected population increases, although per capita water use is expected to
decrease due to water conservation and efficiency gains. Potable water supply from the City’s
supplier, the San Francisco Public Utilities Commission (SFPUC), is projected to be adequate
during normal years, but significant shortfalls are expected during droughts.
The UWMP provides information regarding the alternative water supplies under consideration
by both Palo Alto and the SFPUC. Some of these include expanded uses for recycled water and
storage. Palo Alto, in collaboration with its partners, continues to seek to maximize water
conservation to reduce the impact of dry years. When water supply shortage do occur, Palo
Alto’s WSCP provides for increasingly aggressive steps to reduce use including public outreach
and education, rebate programs, water use restrictions, and water allocation processes.
Staff: Karla Dailey
City of Palo Alto Page 2
BACKGROUND
The California Urban Water Management Planning Act (Act) requires every California water
agency supplying more than 3,000 acre-feet (AF) of water per year or providing service to more
than 3,000 connections to prepare an UWMP. The UWMP is prepared every five years by urban
water suppliers to assess the reliability of water sources over a 20 -year planning horizon under
both normal and dry hydrologic conditions and to ensure adequate water supplies are available
to meet existing and future water demands. Urban water agencies are also required to adopt a
Water Shortage Contingency Plan which lays out the action that will be taken by the agency in
the event of a water supply shortage.
The City must adopt the 2020 UWMP, including the WSCP, by July 1, 2021 and submit it to the
California Department of Water Resources within 30 days of adoption.
DISCUSSION
The key elements of the UWMP are summarized below.
1. Water Demand
2. Water Supply Adequacy
3. Water Conservation
4. Alternative Water Supplies
5. Water Supply Reliability
6. Water Shortage Contingency Plans
1. Water Demand
Although the City has experienced several drought periods since 1975, the recent drought of
2014 to 2016 has had a particularly profound effect on City and customer attitudes regarding
water. The state-mandated water use reductions in the recent drought resulted in large
numbers of landscape conversion projects as well as a dramatic shift in customer behavior
regarding water use. In addition, new construction in every sector is subject t o increasingly
stringent regulations regarding water‐using appliances and fixtures.
The City relied on an end-use model and an econometric model to determine demand
projections. The econometric model projected short-term demands through 2025 based upon
historical water use patterns through 2019 and the projected future rebound in water demand
associated with forecasts for drought recovery. The end-use model projected long-term
demand for each end-use customer class (through 2045) based upon expected service area
growth for both population and employment. The end -use model considers unemployment
rates and projects demand assuming a normal economy. Age of buildings is also considered
with regard to end uses as a result of plumbing code changes and assumed fi xture replacement
rates.
City of Palo Alto Page 3
Figure 1 below shows the City’s potable water use since 1988 and a projection of water supplies
through 2045. Water consumption in the recent drought reached its lowest level in more than
25-years. The reduction in water consumption was the result of state mandated water
reductions combined with permanent water conservation measures.
Figure 1: SFPUC Purchases - Actual and Forecast
In developing these projections the City relied on ABAG population and employment
projections for the 2010 and 2015 UWMPs and models developed by a consultant. According to
these projections shown in Error! Reference source not found., expected 2020-2045
population growth is about 0.8% per year with expected growth in employment 0.5% per year.
These projections do not consider potential impacts of Covid -19. To date, the pandemic
appears to have had little impact on Palo Alto’s water use, but long-term trends such, as a shift
to more telework, are not yet known. Staff will continue to monitor and update water demand
projections during annual supply planning, financial planning, and in the 2025 UWMP.
Table 1: Population - Current and Projected
2020 2025 2030 2035 2040 2045
Service Area Population 68,819 71,667 74,815 77,963 81,111 84,259
Five Year Percent Increase 4.1% 4.4% 4.2% 4.0% 3.9%
Total Employment 97,654 100,095 102,535 104,975 107,416 109,856
Five Year Percent Increase 2.5% 2.4% 2.4% 2.3% 2.3%
City of Palo Alto Page 4
2. Water Supply Adequacy
The City receives 100% of its potable water from the SFPUC through the Regional Water System
(RWS). The City also uses some recycled water produced at the Palo Alto-operated Regional
Water Quality Control Plant (RWQCP) for irrigation of the municipal golf course, a park, and
some other minor applications. A system of local groundwater wells and storage provide
emergency water supply service.
The SFPUC has a perpetual commitment (Supply Assurance) to deliver 184 MGD to the 24
permanent Wholesale Customers collectively. Palo Alto’s allocation, or Individual Supply
Guarantee, is 16.575 MGD, or approximately 18,579 acre feet per year. The City’s allocation
was reduced to this level in May 2018 upon a permanent ISG transfer of 0.5 MGD t o the City of
East Palo Alto1.
In normal years, the Palo Alto’s potable water demand is not expected to exceed supply as
shown in Table 2.
Table 2: Palo Alto Potable Water Supply and Deman d Balance - normal years
2020 2025 2030 2035 2040 2045
Palo Alto Demand for SFPUC
Water 10,921 11,287 11,394 11,546 11,801 12,113
Individual Supply Guarantee 18,579 18,579 18,579 18,579 18,579 18,579
Difference 7,658 7,292 7,185 7,033 6,778 6,466
3. Water Conservation
Water conservation plays an important role in the City’s water supply planning. The City
partners with the Santa Clara Valley Water District (Valley Water) to offer a wide-range of
water conservation programs to our residential and commercial customers. Through rebates,
education and outreach, the City has been able to reduce per capita water use by about 15%
over the past decade.
Senate Bill x7-7 (SBx7-7), adopted in November 2009, mandates a statewide pe r capita potable
water use reduction of 20% by the year 2020. Urban water suppliers are required to identify a
baseline usage (expressed in gallons per capita per day, or GPCD) for their service area,
calculate a target to meet the 20% reduction, and report on compliance in the 2020 UWMP.
The City’s 2020 UWMP confirms the City met the conservation target by more than 20%.
1 See Staff Report #9041 https://www.cityofpaloalto.org/civicax/filebank/documents/64801
City of Palo Alto Page 5
Figure 2: SBx7-7 Targets and Compliance
4. Alternative Water Supplies
In anticipation of extended periods of drought and possible regulatory changes by the State,
the City is evaluating a wide range of alternative water supplies. The Northwest County
Recycled Water Strategic Plan, completed in collaboration with Valley Water, identified and
evaluated a number of potable and non-potable water reuse concept options using effluent
from the RWQCP in Palo Alto. Concept options that are compatible with the effluent transfer
agreement with Valley Water will be considered along with traditional potable supply sources,
demand management, green stormwater infrastructure, and graywater in a holistic 2021 “One
Water” Plan. The One Water Plan will take into consideration long-term reliability and dry year
needs as well as cost, quality, and public acceptance. The City, through the Bay Area Water
Supply and Conservation Agency (BAWSCA), has additional water supply management
opportunities. Each is discussed in more detail in the 2020 UWMP.
The SFPUC is increasing and accelerating its efforts to acquire additional water suppl ies and
explore other projects that would increase overall water supply resilience through the
Alternative Water Supply Planning Program. The key objectives relevant to this effort can be
summarized as:
• Meet dry-year delivery needs while limiting rationing to a maximum of 20 percent
system-wide reduction in water service during extended droughts;
• Diversify water supply options during non-drought and drought periods;
City of Palo Alto Page 6
• Improve use of new water sources and drought management, including groundwater,
recycled water, conservation, and transfers;
• Meet, at a minimum, all current and anticipated legal requirements for protection of
fish and wildlife habitat;
• Maintain operational flexibility.
5. Water Supply Reliability
Since the City relies on the SFPUC RWS for its potable water supplies, the City’s water supply
reliability mirrors that of the RWS. During a water supply shortage, contractually agreed upon
allocation methods apply in limited circumstances. Assumptions regarding how water will be
allocated in critical, severe, and emergency water shortage scenarios were made. The amount
of water available to San Francisco’s Retail Customers (the residential and commercial
customers in the City of San Francisco) and Wholesale Customers (the 26 agencies, including
Palo Alto, that purchase water from the SFPUC) will be impacted by the outcome of the Water
Quality Control Plan for the San Francisco Bay/Sacramento-San Joaquin Delta Estuary (Bay-
Delta Plan Amendment or Bay Delta Plan). This 2020 UWMP assumes the Bay Delta Plan and
associated unimpaired flow requirements for the Tuolumne River will be implemented in 2023
as adopted by the state. In August 2018, City Council voted to support the Bay Delta Plan2.
SFPUC’s water availability projections assumed a Wholesale Customer demand of 184 MGD, the
amount the SFPUC is contractually obligated to provide. The SFPUC will provide an appendix to
their UWMP with water supply availability projections using current Wholesale Customer
demand forecasts which are slightly lower.
Given the City’s forecasted water demand and projections of water supply availability provided
by the SFPUC, the City anticipates the need to implement water use reductions of nearly 50% in
the first dry year post Bay Delta Plan implementation. Table 3 shows the projected necessary
water use reductions for a five-year drought beginning in 2021.
Table 3: Five-year Drought Assessment
Year 2021 2022 2023 2024 2025
Palo Alto Demand 10,565 10,776 10,982 11,182 11,287
Cutback 0.0% 0.0% 43.6% 43.6% 49.0%
Available Supply 10,565 10,776 6,194 6,306 5,759
Similar levels of water use reductions are anticipated for future droughts lasting multiple years.
Table 4 shows the needed anticipated reduction levels.
2 See Council meeting minutes: https://www.cityofpaloalto.org/civicax/filebank/documents/66831
City of Palo Alto Page 7
Table 4: Cutbacks in Future Multiple Dry Years
AFY 2025 2030 2035 2040 2045
First Year 36.1% 36.3% 36.5% 36.5% 45.5%
Second Year 45.2% 45.4% 45.6% 45.6% 45.5%
Third Year 45.2% 45.4% 45.6% 45.6% 45.5%
Fourth Year 45.2% 45.4% 45.6% 52.0% 53.7%
Fifth Year 45.2% 45.4% 50.1% 52.0% 53.7%
6. Water Shortage Contingency Planning
During the most recent drought, the City was able to reduce water use by 31% by restricting
landscape irrigation to two times per week as well as a number of other measures. The City’s
proposed Water Shortage Contingency Plan (WSCP) includes actions to achieve water use
reductions above 40% and above 50%, but the City does not have actual experience in
implementing such drastic measures. With each progressive stage, enforcement, rate
strategies, and water use restrictions will be increased while putting in place mit igation
measures to maintain the health of the City’s tree canopy.
Table 5: Summary of Proposed Water Shortage Contingency Plan
Stage I Stage II Stage III Stage IV Stage V Stage VI
Target Water
Savings
Up to 10%
10% -20%
20% -30%
30% - 40%
40%- 50%
Above 50%
Information
Outreach
and Audit
Program
Low level
outreach
Increase advertising, social media
campaigns and direct communication with
customers targeting highest users and
increasing water use auditing
Escalate
outreach
efforts and
media
campaign
with focus on
water use
prioritization
Highest
outreach
effort level
with focus
on health
and safety
Demand-Side
Management
Programs
Continuation
of existing
programs,
evaluation of
new programs
Augment programs and incentive levels as necessary to achieve
reduction targets
Rate
Structures
Standard
rates already
encourage
conservation
Drought rate structures may be
implemented to secure needed revenue
Water allocations or
allotments may be
implemented
City of Palo Alto Page 8
Stage I Stage II Stage III Stage IV Stage V Stage VI
Water Use
Restrictions
Only
permanent
water use
ordinance –
no new
restrictions
apply
Water use restrictions become more severe with each stage and
enforcement is enacted more strongly with each stage. With each stage,
efforts made to ensure tree canopy is protected as much as possible.
Recycled
Water Use
Business as
usual use
Water use restrictions require use of recycled water for specific
purposes, advertise availability of recycled water for trucked delivery,
use recycled water for City facilities and street trees as much as
possible.
Short-term emergency water needs will be met with the City’s groundwater wells and storage
system which was recently renovated. The system was designed to provide adequate fire
protection following a disaster such as a major earthquake. Groundwater may also be available
during drought periods although pumping restrictions may be in place, and the City’s wells are
currently restricted to 1,500 AFY, 5 consecutive days of pumping, and 15 days of pumping per
year. Expanded groundwater utilization as a drought supply and as a long-term supply will be
considered as part of the One Water Plan.
COMMUNITY ENGAGEMENT
An UWMP webpage (www.cityofpaloalto.org/UWMP) was created to educate the public about
the UWMP process, provide outreach for public meetings and opportunities to participate, as
well as to make available background materials on the City’s urban water management
planning activities. Public participation notices were sent by the City in compliance with Water
Code 10621(b), 10620(d)(2), and 10642.
ENVIRONMENTAL IMPACT
Adoption of the resolutions approving the 2020 Urban Water Management Plan and the Water
Shortage Contingency Plan is exempt from California Environmental Quality Act’s (CEQA) review
pursuant to Water Code Section 10652.
Attachments:
• Attachment A: Resolution Approving the 2020 Urban Water Management Plan
• Attachment B: Resolution Approving the 2020 Water Shortage Contingency Plan WSCP
• Attachment C: 2020 Urban Water Management Plan and Water Shortage Contingency
Plan
• Attachment D: Presentation
*NOT YET APPROVED*
1
6055503
Resolution No. XXXX
Resolution of the Council of the City of Palo Alto Adopting the 2020
Urban Water Management Plan to be Submitted to the California Department
of Water Resources
R E C I T A L S
A.The California Legislature has enacted the Urban Water Management
Planning Act, California Water Code Sections 10610 -10656 and 10608, as amended, which
requires every urban water supplier providing water to more than 3,000 customers or supplying
more than 3,000 acre -feet of water annually to prepare an urban water management plan
("Plan") that has as its primary objective the conservation and efficient use of water.
B.The City of Palo Alto ("City"), a municipal utility and chartered city, is an
urban water supplier providing water to a population over 60,000.
C.The Plan must be reviewed at least once every five years by the City, which
must amend the Plan, as necessary, after it has conducted a review.
D.The preparation of the updated Plan has been coordinated with other
public agencies to the extent practicable, and staff has encouraged the active involvement of
diverse social, cultural and economic sectors of the population within the City's retail water
service area during preparation of the Plan.
E.The Plan must be adopted by July 1, 2021, after it is first made available for
public inspection and a public hearing is noticed and held, and it must be filed with the California
Department of Water Resources within thirty days of adoption.
F.After reviewing a draft Plan at their May 12, 2021 meeting, the Utilities
Advisory Commission recommended that the Council adopt the Plan as presented; and
G.A noticed public hearing on the revised draft Plan was held by the City
Council on June 14, 2021, at which time public comments were heard and considered.
NOW, THEREFORE, the Council of the City of Palo Alto RESOLVES as follows:
SECTION 1. The Council hereby adopts the 2020 Urban Water Management Plan of the
City of Palo Alto, which shall be filed with the City Clerk. The City Manager is hereby authorized
and directed to file the 2020 Urban Water Management Plan of the City of Palo Alto with the
California Department of Water Resources and the State Library.
//
//
Attachment A
*NOT YET APPROVED*
2
6055503
//
SECTION 2. The Council finds and determines that, under the California Water Code
Section 10652, the adoption of the Plan and the WSCP and this resolution does not constitute a
project under the California Environmental Quality Act, and no environmental assessment is
required.
INTRODUCED AND PASSED: June X, 2021
AYES:
NOES:
ABSENT:
ABSTENTIONS:
ATTEST:
__________________________ _____________________________
City Clerk Mayor
APPROVED AS TO FORM: APPROVED:
___________________________ _____________________________
City Attorney or designee City Manager
_____________________________
Director of Utilities
_____________________________
Director of Administrative Services
*NOT YET APPROVED*
1
6055504
Resolution No. XXXX
Resolution of the Council of the City of Palo Alto Adopting the 2020 Water
Shortage Contingency Plan Included in the Urban Water Management Plan to be
Submitted to the California Department of Water Resources
R E C I T A L S
A.The California Legislature has enacted the Urban Water Management
Planning Act, California Water Code Sections 10610 -10656 and 10608, as amended, which
requires every urban water supplier providing water to more than 3,000 customers or supplying
more than 3,000 acre -feet of water annually to prepare an urban water management plan
("UWMP") that has as its primary objective the conservation and efficient use of water.
B.The California Water Code requires urban water suppliers to prepare a
Water Shortage Contingency Plan (WSCP) to be included in its UWMP.
C.The WSCP must be adopted, along with the UWMP, by July 1, 2021, after it
is first made available for public inspection and a public hearing is noticed and held, and it must
be filed with the California Department of Water Resources within thirty days of adoption.
D.After reviewing a draft WSCP, which is included in the UWMP, at their May
12, 2021 meeting, the Utilities Advisory Commission recommended that the Council adopt the
WSCP as presented; and
E.A noticed public hearing on the WSCP, included in the UWMP, was held by
the City Council on June 14, 2021, at which time public comments were heard and considered.
NOW, THEREFORE, the Council of the City of Palo Alto RESOLVES as follows:
SECTION 1. The Council hereby adopts the 2020 Water Shortage Contingency Plan of the
City of Palo Alto, included in its UWMP, which shall be filed with the City Clerk. The City Manager is
hereby authorized and directed to file the 2020 Water Shortage Contingency Plan of the City of
Palo Alto, included in the UWMP, with the California Department of Water Resources and the
State Library.
//
//
//
//
Attachment B
*NOT YET APPROVED*
2
6055504
SECTION 2. The Council finds and determines that, under the California Water Code
Section 10652, the adoption of the Plan and the WSCP and this resolution does not constitute a
project under the California Environmental Quality Act, and no environmental assessment is
required.
INTRODUCED AND PASSED: June X, 2021
AYES:
NOES:
ABSENT:
ABSTENTIONS:
ATTEST:
__________________________ _____________________________
City Clerk Mayor
APPROVED AS TO FORM: APPROVED:
___________________________ _____________________________
City Attorney or designee City Manager
_____________________________
Director of Utilities
_____________________________
Director of Administrative Services
i
2020
URBAN WATERMANAGEMENT PLAN
and Water Shortage Contingency Plan
JUNE 2021
Attachment C
ii
City of Palo Alto Utilities
2020
Urban Water Management Plan and Water
Shortage Contingency Plan
June 2021
iv
Table of Contents
List of Tables ....................................................................................................................... vii
List of Figures ...................................................................................................................... viii
List of Acronyms ................................................................................................................... ix
Contact Sheet ........................................................................................................................ 1
Section 1 – Plan Development and Adoption ......................................................................... 2
Lay Description .......................................................................................................................... 2
Plan Structure ........................................................................................................................... 3
Plan Adoption............................................................................................................................ 3
Public Participation ................................................................................................................... 4
Agency Coordination ................................................................................................................. 6
Internal City Coordination .................................................................................................. 6
Interagency Coordination ................................................................................................... 7
The Water Supply Master Plan ........................................................................................... 8
Integrated Regional Water Management Plan ................................................................... 8
BAWSCA Long-Term Reliable Water Supply Strategy ......................................................... 9
Palo Alto Regional Water Quality Control Plant Long Range Facilities Plan ....................... 9
Northwest County Recycled Water Strategic Plan ............................................................. 9
Valley Water 2040 Water Supply Master Plan ................................................................... 9
Valley Water Countywide Water Reuse Master Plan ....................................................... 10
Section 2 – Service Area ....................................................................................................... 11
Demographics ......................................................................................................................... 11
Climate Characteristics ........................................................................................................... 12
Section 3 – System Supplies ................................................................................................. 13
Historical Background ............................................................................................................. 13
Water Integrated Resource Planning................................................................................ 13
Sustainability and Climate Action Plan ............................................................................. 16
Northwest County Recycled Water Strategic Plan ........................................................... 17
Effluent Transfer Agreement ............................................................................................ 17
Current and Planned Water Supply Sources .................................................................... 17
SFPUC Supply .......................................................................................................................... 18
Description of SFPUC Regional Water System .................................................................. 18
Water Supply Agreement ................................................................................................. 18
SFPUC Water Supply Alternative Evaluation Efforts ............................................................... 22
BAWSCA and Its Role .............................................................................................................. 22
Regional Water Demand and Conservation Projections .................................................. 22
Long-Term Reliable Water Supply Strategy ...................................................................... 23
Making Conservation a Way of Life Strategic Plan ........................................................... 24
v
Alternative Water Supply Analysis .......................................................................................... 25
Transfer or Exchange Opportunities ....................................................................................... 25
Groundwater ........................................................................................................................... 26
Deep Aquifer Groundwater .............................................................................................. 26
Shallow Aquifer Groundwater .......................................................................................... 30
Water Recycling ...................................................................................................................... 31
Wastewater Collection and Treatment in Palo Alto ......................................................... 31
Palo Alto Recycled Water Production ............................................................................... 33
Disposal of Wastewater .................................................................................................... 33
Recycled Water Current and Potential Use ...................................................................... 33
Current Recycled Water Use ............................................................................................. 34
Potential Recycled Water Use .......................................................................................... 34
Regional Collaboration ...................................................................................................... 37
Encouraging and Optimizing Recycled Water Use............................................................ 39
Desalinated Water .................................................................................................................. 41
Energy Intensity ...................................................................................................................... 42
Section 4 – Water Demand .................................................................................................. 43
Water Usage ........................................................................................................................... 43
Lay Description .................................................................................................................. 43
Demand Projections .......................................................................................................... 44
Water Sales ....................................................................................................................... 45
Share of Total Consumption by Customer Type ............................................................... 46
Sales to Other Agencies .................................................................................................... 47
Additional Water Uses - Recycled Water Use ................................................................... 47
Non-Revenue Water/Water Loss ...................................................................................... 48
Total Water Use ................................................................................................................ 48
Projected Low to Moderate Income Water Use ............................................................... 49
Water Conservation Bill of 2009 ............................................................................................. 50
Measures, Programs and Policies that Achieved SBx7-7 Water Targets .......................... 52
Economic Impacts of SBx7-7 Compliance ......................................................................... 52
Section 5 – Demand Management Measures ....................................................................... 53
Water Waste Prevention Ordinance ....................................................................................... 54
Green Building Ordinance and Model Efficient Landscape Ordinance .................................. 54
Metering ................................................................................................................................. 54
Conservation Pricing ............................................................................................................... 55
Public Education and Outreach .............................................................................................. 55
Programs to Assess and Manage Distribution Systems Real Loss .......................................... 56
Water Conservation Program Coordination and Staffing Support ......................................... 57
Water Conservation Programs ......................................................................................... 57
Water Wise Survey Program ............................................................................................. 57
vi
Landscape Rebate Program .............................................................................................. 58
Home Water Report Program ........................................................................................... 58
Water Efficient Technology Rebate Program ................................................................... 58
Submeter Rebate Program ............................................................................................... 59
Water Conservation Coordinator ..................................................................................... 59
Water Waste Coordinator................................................................................................. 59
Large Landscape Survey and Water Budget Program ...................................................... 59
BAWSCA Conservation Programs ........................................................................................... 59
Section 6 – Water Supply Reliability ..................................................................................... 61
Water Supply Reliability .......................................................................................................... 61
Reliability of the Regional Water System ......................................................................... 61
Coordinated Efforts Between BAWSCA and the SFPUC to Develop of Alternative Water
Supplies ................................................................................................................................... 70
Climate Change ....................................................................................................................... 71
Local Plans to Ensure a Reliable Water Supply ....................................................................... 76
Section 7 – Water Shortage Contingency Plan ...................................................................... 77
Background ............................................................................................................................. 77
Preparation for Catastrophic Supply Interruption .................................................................. 78
Emergency Preparedness Plans ........................................................................................ 78
Emergency Drinking Water Planning ................................................................................ 80
Power Outage Preparedness and Response ..................................................................... 80
Seismic Risk Assessment and Mitigation Plan ................................................................... 81
Local Distribution System Reliability ................................................................................. 82
Emergency Response Plan ................................................................................................ 83
Water Supply and Demand Assessment ................................................................................. 85
Decision-Making Process to Determine Water Supply Availability .................................. 85
Data and Methodologies .................................................................................................. 86
Approval Process ............................................................................................................... 87
SFPUC Annual Water Supply and Demand Assessment Procedures ...................................... 87
Demand Assessment ........................................................................................................... 88
Supply Assessment ............................................................................................................ 88
Infrastructure Considerations ........................................................................................... 91
System Modeling .............................................................................................................. 91
Decision-Making Process .................................................................................................. 92
Water Shortage Contingency Plan .......................................................................................... 94
Palo Alto’s Experience with Drought Management ......................................................... 94
Regional Interim Water Shortage Allocation Plan ............................................................ 95
Water Shortage Mitigation Options ....................................................................................... 97
Supply Side Options .......................................................................................................... 97
Demand Side Options ....................................................................................................... 98
vii
Water Shortage Contingency Plan Stages of Action ............................................................. 104
STAGE I – Minimum Water Supply Shortage: Up to 10% target water savings ............. 104
STAGE II – Moderate Water Supply Shortage: 10% to 20% target water savings .......... 105
STAGE III – Severe Water Supply Shortage: 20% to 30% target water savings .............. 106
STAGE IV – Severe to Critical Water Supply Shortage: 30% to 40% target water savings
......................................................................................................................................... 107
STAGE V – Critical Water Supply Shortage: 40% to 50% target water savings .............. 107
STAGE VI – Water Emergency: Greater than 50% target water savings ........................ 108
Alternative Water Supplies During a Water Shortage .......................................................... 110
Revenue and Expenditure Impacts and Measures to Overcome Impacts ........................... 111
Revenue Reductions, Expense Increases, and Cost of Compliance ................................ 111
Mitigation Actions ........................................................................................................... 112
Monitoring Customer Compliance and Reporting ................................................................ 113
Water Shortage Contingency Legal Authority ...................................................................... 114
Reevaluation and Improvement of Procedures.................................................................... 114
Section 8 – Supply and Demand Comparison Provisions ..................................................... 115
Supply and Demand Comparison ......................................................................................... 115
Normal Year Supply and Demand ................................................................................... 115
Dry Year Scenarios .......................................................................................................... 117
APPENDIX A ‐ Resolutions Adopting Urban Water Management Plan and Water Shortage
Contingency Plan ............................................................................................................... 123
APPENDIX B ‐ Public Participation Notices.......................................................................... 124
APPENDIX C ‐ Water Loss Report........................................................................................ 126
APPENDIX D – DWR Standardized Tables ........................................................................... 128
APPENDIX E – City of Palo Alto Resolution Approving Water Shortage Allocation Plan
(w/attachments) ............................................................................................................... 156
APPENDIX F ‐ Water Shortage Contingency Plan Draft Ordinance ....................................... 159
APPENDIX G ‐ Water Shortage Contingency Plan Evaluation Criteria .................................. 161
APPENDIX H ‐ Water Shortage Contingency Plan Use Restrictions ...................................... 164
List of Tables
Table 1: Calendar for Adoption...................................................................................................... 4
Table 2: Coordination with Appropriate Agencies ....................................................................... 10
Table 3: Population – Current and Projected ............................................................................... 12
Table 4: Climate ............................................................................................................................ 12
Table 5: Current and Planned Water Supply Sources ................................................................... 17
viii
Table 6: Wastewater Treatment ................................................................................................... 33
Table 7: Wastewater Collected and Treated – AF ........................................................................ 33
Table 8: Disposal of Wastewater (non-recycled) – AF .................................................................. 33
Table 9: Potential Future Use of Recycled Water in Palo Alto- AFY ............................................. 37
Table 10: Historical and Projected Water Sales – by Customer Type (Fiscal Years) ..................... 46
Table 11: Historical and Projected Water Accounts – by Customer Type (Fiscal Years) .............. 46
Table 12: Historical and Projected Water Sales per Account (AF) (Fiscal Years) .......................... 46
Table 13: Recycled Water Use (AFY) ............................................................................................. 48
Table 14: Non-Revenue Water (AFY) ............................................................................................ 48
Table 15: Total Water Use (AFY) ................................................................................................... 48
Table 16: Projected Low Income Water Demands (AF) ................................................................ 49
Table 17: Baseline Daily Per Capita Water Use for 10-year period (1995 through 2004) ............ 51
Table 18: 2015 UWMP SBx7-7 Performance Metrics (gallons per capita per day) ...................... 52
Table 19: Interties with other Agencies ....................................................................................... 83
Table 20: Key Input for the Water Supply and Demand Assessment ........................................... 86
Table 21: RWS Supply Availability in Normal Years (MGD) .......................................................... 90
Table 22: RWS Supply Utilized in Normal Years (MGD) ................................................................ 91
Table 23: SFPUC and Wholesale Customer Share of Available Water ......................................... 96
Table 24: WSCP Summary ........................................................................................................... 110
Table 25: SFPUC System Supply and Wholesale Customer Supply and Demand (AFY) ............ 116
Table 26: City of Palo Alto Supply/Demand Balance (AFY) ......................................................... 116
Table 27: SFPUC Water Supply Improvement Program Project Assumptions ........................... 117
Table 28: SFPUC WSIP Project Assumptions ............................................................................... 118
Table 29: Projected Multiple Dry Years Wholesale Supply from RWS, Bay Delta Plan in 2023 . 118
Table 30: Single Dry Year Potable Water Supply Shortfall for Palo Alto .................................... 118
Table 31: Projected Potable Water Use Reductions in Multiple Dry year Scenario ................... 119
Table 32: Water Supply Available to Wholesale Customers in Consecutive Dry Years; 2020 ... 119
Table 33: Water Supply Available to Wholesale Customers in Consecutive Dry Years; 2025 ... 119
Table 34: Water Supply Available to Palo Alto in Consecutive Dry Years; 2020 ........................ 120
Table 35: Water Supply Available to Palo Alto in Consecutive Dry Years; 2025 ........................ 120
Table 36: Projected RWS Supply for 5-Year Drought Assessment (AFY) .................................... 120
Table 37: projected RWS Supply Available to Palo Alto for 5-year Drought Assessment (AFY) . 120
List of Figures
Figure 1: Potential Groundwater Use Area ................................................................................. 28
Figure 2: Phase 3 Recycled Water Expansion Project Overview .................................................. 36
Figure 3: Palo Alto, Mountain View, Valley Water Partnership Agreement ................................ 38
Figure 4: Water Supply Purchases – Actual and Forecast ............................................................ 45
Figure 5: FY 2015 Water Sales by Customer Class ........................................................................ 47
Figure 6: FY 2020 Water Sales by Customer Class ........................................................................ 47
Figure 7: SFPUC WSDA Process ..................................................................................................... 93
ix
Figure 8: Palo Alto Water use Reductions Compared to State-Mandated Target ....................... 95
List of Acronyms
AF Acre Feet
ABAG Association of Bay Area Governments
AF/Y Acre Feet per Year
AWSP Alternative Water Supply Planning
BAWAC Bay Area Water Agencies Coalition
BAWSCA Bay Area Water Supply and Conservation Agency
BCA Baseline Consumption Allowance
BMP Best Management Practices
CAFR City Audited Financial Report
CALTRANS California Department of Transportation
ccf Centum Cubic Feet (hundred cubic feet)
CCSF City and County of San Francisco
CEE Consortium for Energy Efficiency
CEQA California Environmental Quality Act
CIMIS California Irrigation Management Information System
COM Commercial
CPAU City of Palo Alto Utilities
CUWCC California Urban Water Conservation Council
DHS Department of Health Services
DSM Demand Side Management
DMM Demand Management Measures
DSS Demand Side Management Least Cost Planning Decision Support System
EIR Environmental Impact Report
EPA Environmental Protection Agency
ET Evapotranspiration
ETO Reference Evapotranspiration
FEMA Federal Emergency Management Agency
FY Fiscal Year
gpm Gallons per minute
GSI Green Stormwater Infrastructure
GUA Groundwater Use Assessment
HET High Efficiency Toilets
ICI Industrial Commercial and Institutional
WIRP Integrated Resource Plan
IRWMP Integrated Regional Water Management Plan
IT Information Technology
IWSAP Interim Water Shortage Allocation Plan
x
LOS Level of Service
MF Multi-family
mg/L Milligrams per liter
MGD Million Gallons per Day
MOU Memorandum of Understanding
O&M Operations and Maintenance
OES Office of Emergency Services
RWQCP Palo Alto Regional Water Quality Control Plant
PEIR Program Environmental Impact Report
RWS Regional Water System
Valley Water Santa Clara Valley Water District
S/CAP Sustainability and Climate Action Plan
SIP Sustainability Implementation Plan
SF Single-family
SFPUC San Francisco Public Utilities Commission
SFWD San Francisco Water Department
SWRCB State Water Resources Control Board
TAC Technical Advisory Committee
TDS Total Dissolved Solids
TRC Total Resource Cost
UAC Utilities Advisory Commission
UER Utilities Emergency Response
ULF Ultra Low Flow
ULFT Ultra Low Flow Toilet
URS United Research Services, Consultant Firm
UWMP Urban Water Management Plan
WIRP Water Integrated Resource Plan
WPL West Pipeline
WSA Water Supply Agreement
WSAP Water Shortage Allocation Plan
WSIP Water System Improvement Program
WSMP Water Supply Master Plan
1
City of Palo Alto Utilities
2020 Urban Water Management Plan
Contact Sheet
Date plan submitted to the Department of Water Resources: June X, 2021
Name of persons preparing this plan:
Karla Dailey, Senior Resource Planner
Lisa Bilir, Resource Planner
Phone:
(650) 329‐2523 (650) 329‐2289
Fax: (650) 326‐1507
E-mail address: karla.dailey@CityofPaloAlto.org lisa.bilir@CityofPaloAlto.org
Utility services provided by the City include: electric, natural gas, commercial fiber, refuse,
recycled water, storm drain, wastewater collection, treatment and disposal.
Is This Agency a Bureau of Reclamation Contractor? No Is This Agency a State Water Project
Contractor? No
2
Section 1 – Plan Development and Adoption
Lay Description
Law* (see note)
California Water Code section 10620 1 (a) Every urban water supplier shall prepare and adopt an
urban water management plan in the manner set forth in Article 3 (commencing with Section
10640).
10630.5.
Each plan shall include a simple lay description of how much water the agency has on a reliable
basis, how much it needs for the foreseeable future, what the agency’s strategy is for meeting its
water needs, the challenges facing the agency, and any other information necessary to provide a
general understanding of the agency’s plan.
The City of Palo Alto (City) is located in northern Santa Clara County approximately 35 miles
south of the City of San Francisco. In addition to serving about 20,000 residential and
commercial water customers, the City operates electric, gas, wastewater, and fiber utilities.
The City receives 100% of its potable water from the San Francisco Public Utilities Commission
(SFPUC) through the Regional Water System (RWS). The City also uses some recycled water
produced at the Palo Alto-operated Regional Water Quality Control Plant (RWQCP) for
irrigation of the municipal golf course, a park, and some other minor applications. A system of
local groundwater wells and storage provide emergency water supply service.
The City partners with the Santa Clara Valley Water District (Valley Water) to offer a wide-range
of water conservation programs to our residential and commercial customers. Through rebates,
education and outreach, the City has been able to reduce per capita water use by about 15%
over the past decade.
The City is active in regional efforts to address long-term water supply issues. In 2019 the City
signed a historic 76-year agreement with Valley Water and the City of Mountain View. The
agreement includes Valley Water funding for a salt-removal facility at the RWQCP which will
improve the quality and thus the uptake of recycled water use, particularly in Mountain View.
The transfer of effluent from the RWQCP to Valley Water enables development of a regional
purified water supply.
In 2020, the City in collaboration with Valley Water, completed a recycled water strategic plan
laying the groundwork for a One Water Plan that will incorporate an evaluation of all water
supply options to meet both potable and non-potable demands in the City. The One Water Plan
• Note: Relevant sections and/or subparts or portions of the California Water Code are set forth at the
beginning of each Section to provide the statutory context for the discussion.
1 Unless noted, all statutory references herein are to the California Water Code.
3
will take into consideration long-term reliability and dry year needs as well as cost, quality, and
public acceptance.
Since the City relies on the SFPUC RWS for its potable water supplies, the City’s water supply
reliability mirrors that of the RWS. During a water supply shortage, contractually agreed upon
allocation methods apply in limited circumstances. Assumptions regarding how water will be
allocated in critical, severe, and emergency water shortage scenarios were made. The amount
of water available to San Francisco’s Retail Customers (the residential and commercial
customers in the City of San Francisco) and Wholesale Customers (the 26 agencies, including
Palo Alto, that purchase water from the SFPUC) will be impacted by the outcome of the Water
Quality Control Plan for the San Francisco Bay/Sacramento-San Joaquin Delta Estuary (Bay-
Delta Plan Amendment or Bay Delta Plan). This 2020 UWMP assumes the Bay Delta Plan and
associated unimpaired flow requirements for the Tuolumne River will be implemented as
adopted by the state.
Given the City’s forecasted water demand and projections of water supply availability provided
by the SFPUC, the City anticipates the need to implement water use reductions of nearly 50% in
the first dry year post Bay Delta Plan implementation. During the most recent drought, the City
was able to reduce water use by 31% by restricting landscape irrigation to two times per week
as well as a number of other measures. The City’s proposed Water Shortage Contingency Plan
(WSCP) includes actions to achieve water use reductions above 40% and above 50%, but the
City does not have actual experience in implementing such drastic measures. With each
progressive stage, enforcement, rate strategies, and water use restrictions will be increased
while putting in place mitigation measures to maintain the health of the City’s tree canopy.
Short-term emergency water needs will be met with the City’s groundwater wells and storage
system which was recently renovated. The system was designed to provide adequate fire
protection following a disaster such as a major earthquake.
Plan Structure
The City has not experienced significant changes in the water supply distribution system and
reliability since the preparation of the 2015 Urban Water Management Plan (UWMP), and has
determined the 2015 UWMP provided sufficient guidance to meet the City’s needs during the
2015 UWMP cycle. For the 2020 UWMP report, the City has updated the 2015 UWMP and
addressed any changes to the UWMP Act since 2015 as outlined in Appendix C of the
Department of Water Resources (DWR) UWMP Guidebook.
Plan Adoption
The City began preparing this update of its Urban Water Management Plan in fall 2020. The
updated plan will be considered by City Council before June 30, 2021 and submitted to the
California Department of Water Resources within 30 days of Council adoption. This plan
4
includes all information necessary to meet the requirements of California Water Code Division
6, Part 2.6 (Urban Water Management Planning) as well as requirements of the California
Water Code Division 6, Part 2.55 (Water Conservation Bill of 2009).
Public Participation
The City actively encourages community participation in its urban water management planning
efforts. The City held public hearings before the Utilities Advisory Commission (UAC) and City
Council prior to adoption. Table 1 shows the key dates. An UWMP webpage
(www.cityofpaloalto.org/UWMP) was created to educate the public about the UWMP process,
provide outreach for public meetings and opportunities to participate, as well as to make
available background materials on the City’s urban water management planning activities.
Table 1: Calendar for Adoption
Date Meeting/Activity Topic
May 12, 2021 Utilities Advisory Commission Review and Recommendation on UWMP
and WSCP
June 4, 2021 Published Notice of Public Hearing Newspaper (Council meeting) on UWMP
and WSCP
June 14, 2021 City Council Review and Adoption of UWMP and WSCP
June 14, 2021 Final UWMP and Council
Resolutions
Submitted to DWR
July 1, 2021 Final UWMP and Council
Resolutions
Available to the Public
Appendix B contains samples of the public participation notices the City sent in compliance with
Water Code 10621(b), 10620(d)(2), and 10642. A sample notice of the City Council meeting will
be added to the Final Draft 2020 UWMP that will be presented to Council for approval.
The City’s Utilities Advisory Commission (UAC) provides advice to the City Council on:
•The acquisition and development of electric, gas and water resources;
•Joint action projects with other public or private entities which involve electric, gas or
water resources; wastewater collection and fiber optic issues;
•Environmental implications of electric, gas or water utility projects; and
•Resource conservation and demand management.
The UAC meets monthly and reviews the activities of the various utility services. One of the
primary tasks of the UAC is to assist with the review and development of long-term plans for
5
the City’s utilities. The UAC meetings are open to the public and agendas are posted for public
review prior to each meeting. The schedule for approval of the 2020 UWMP provides the
opportunity for the UAC to review and comment on the Draft UWMP prior to submittal to the
City Council for final approval.
Since adoption of the 2015 UWMP, the UAC and Council have been active in the review of
water supply and water management activities.
Water Integrated Resource Planning was discussed at the following meetings:
•November 2016 UAC meeting: Discussed the draft Water Integrated Resource Plan (WIRP)
•November 2017 UAC meeting: UAC recommended WIRP for Council approval
•March 2017 Council meeting: Council adopted WIRP
Water Reuse was discussed publicly at the following meetings:
•April 2016 Council meeting: Council received an update on recycled water planning efforts
and groundwater studies in partnership with Valley Water
•August 2018 UAC meeting: Discussed a business plan for expansion of Palo Alto’s non-
potable reuse irrigation network.
•October 2018 UAC meeting: Discussed wastewater reuse expansion opportunities
•November 2018 Council (Council Report #9731): Study session on high-level wastewater
reuse expansion opportunities.
•April 2019 Community Engagement Event: Feedback solicited on water reuse
opportunities
•September 2019 UAC meeting: Discussed water reuse options and the Partnership
Agreement with Valley Water
•September 2019 Council meeting: Study session regarding water reuse opportunities and
the Partnership Agreement with Valley Water
•October 2019 Community Engagement Event: Provided information and answered
questions regarding the Partnership Agreement with Valley Water.
•November 2019 Council meeting: Council approved the Partnership Agreement with
Valley Water
Bay Delta Plan
•August 2018 Council meeting: Council voted to support the State Water Resources Control
Board’s Bay Delta Plan to have 40 percent of natural water in the Central Valley to enter
the Delta from February to June and associated Southern Delta salinity objectives; and
send a letter expressing this policy position to Bay Area Water Supply and Conservation
Agency (BAWSCA), California State Water Resources Control Board, San Francisco Public
Utilities Commission (SFPUC), and other stakeholders Staff believes should receive the
letter.2
2 See Council meeting minutes: https://www.cityofpaloalto.org/civicax/filebank/documents/66831
6
Water is the subject of one of seven chapters in the City’s Sustainability and Climate Action Plan
(S/CAP) discussed publicly at the following meetings:
• November 2016 Council meeting: Council adopted the S/CAP framework
• December 2017 Council meeting: Council accepted the 2018-2020 Sustainability
Implementation Plan (SIP)
• May 2020 Council meeting: Council discussion of Goals and Key Actions for 2020 S/CAP
Council accepted the Green Stormwater Infrastructure Plan on May 13, 2019.
In August 2020, the UAC heard a “One Water” presentation by Professor Richard Luthy,
Stanford University.
Agency Coordination
Law
10620 (a) Every urban water supplier shall prepare and adopt an urban water management plan in
the manner set forth in Article 3 (commencing with Section 10640).
10620(d) (1) An urban water supplier may satisfy the requirement of this part by participation in
area wide regional, watershed, or basis wide urban water management planning where those
plans will reduce preparation costs and contribute to the achievement of conservation and
efficient water use.
10620(d)(3) Each urban water supplier shall coordinate the preparation of its plan with other
appropriate agencies in the area, including other water suppliers that share a common source,
water management agencies, and relevant public agencies, to the extent practicable.
10642
Each urban water supplier shall encourage the active involvement of diverse social, cultural, and
economic elements of the population within the service area prior to and during the preparation
of the plan...
Internal City Coordination
Many members of City staff collaborated in the development of this plan, including
representatives from all divisions of the City of Palo Alto Utilities Department (CPAU) and other
City departments including Planning and Development Services, the City Manager’s Office, the
City Attorney’s Office, the City Clerk’s office, and Public Works. The UWMP is coordinated with
other City planning and policy level documents to ensure the water policy direction in the
UWMP informs future decisions within the City of Palo Alto, including the Urban Forest Master
Plan and the Comprehensive Plan.
Since completion of the 2015 UWMP, CPAU has completed several important water supply and
planning milestones, including:
7
• Approval of the 2017 Water Integrated Resources Plan Guidelines (March 2017) – The
WIRP provided Council with a comparison of potable water supply alternatives and
demand-side management measures.
• Approval of the Addendum to the 2015 Environmental Impact Report for the City of
Palo Alto Recycled Water Program, and Approval of an Agreement Between the City of
Palo Alto, City of Mountain View, and Santa Clara Valley Water District to Advance
Resilient Water Reuse Programs in Santa Clara County, Including Funding for an
Advanced Water Purification Facility in Palo Alto, a Long‐Term Transfer of Effluent from
the Regional Water Quality Control Plant to Valley Water, and Related Commitments
(November 2019) – The 76-year agreement enables an effluent transfer from the RWQCP
in Palo Alto to Valley Water to be reused in Santa Clara County. The agreement also
provides funding from Valley Water for a salt removal facility in Palo Alto to improve the
quality of recycled water used in Palo Alto and the City of Mountain View.
• Acceptance of the Northwest County Recycled Water Strategic Plan (March 2020) – The
plan presents the feasibility of various potable and non-potable opportunities to reuse
water from the RWQCP within the plant’s service territory. The study includes a robust
evaluation of the groundwater aquifer in Northwest Santa Clara County.
The completion of the plans and agreements listed above required the cooperation of all
divisions within the CPAU and several other departments within the City. Data and information
from these reports was used in this document.
Interagency Coordination
The City is an active member of the California water community and coordinated with a
number of agencies in preparation of its 2020 UWMP. The City is particularly active in the
following organizations:
• The City is an active member of the Bay Area Water Supply and Conservation Agency
(BAWSCA). The BAWSCA members, including the City, receive water from the City and
County of San Francisco through a contract that is administered by the SFPUC.
• The City is represented on the Valley Water Commission, the Joint Recycled Water
Committee, the Valley Water Retailers Group, the Valley Water Recycled Water
Subcommittee, the Valley Water Communication Subcommittee, and the Valley Water
Conservation Subcommittee.
• Through BAWSCA, the City is represented in the Bay Area Water Agencies Coalition
(BAWAC), a group of the seven largest water agencies in the Bay Area. BAWAC was
established to develop regional water planning objectives, coordinate projects and
programs that would meet the regional objectives to improve water supply reliability and
water quality, and document, coordinate and communicate existing and planned
programs and activities being implemented in the Bay Area region in the areas of water
use efficiency and water treatment.
• The City is a member of the California Water Efficiency Partnership CalWEP, whose
mission is to maximize urban water efficiency and conservation throughout California.
8
• The City is a member of the WateReuse Association, an organization of governmental,
non-profit and private sector entities working together to encourage increased recycled
water use in California.
• The City is a member of the Alliance for Water Efficiency.
• The City is a Partner in the Environmental Protection Agency’s (EPA) WaterSense program,
which promotes water efficient products and assists utilities in marketing its programs for
water use efficiency.
• The City Council adopted the Ahwahnee Water Principles for Resource Efficient Land Use
on October 17, 2005.3 These principles were developed by the Local Government
Commission, a nonprofit, nonpartisan organization working to create healthy, walkable,
and resource-efficient communities.
• The City is a member of the Bay Area Clean Water Agencies (BACWA). BACWA members
work together to carry out mutually beneficial projects, and to share scientific, economic
and other information about the San Francisco Bay environment.
• The City is a member of the Western Recycled Water Coalition (WRWC), an organization
that pursues highly leveraged, locally managed projects that will help ensure the security
of water supplies.
• The City is a participant in the Bay Area Integrated Regional Water Management Plan
(IRWMP) working to coordinate and improve water supply reliability, protect water
quality, manage flood protection, maintain public health standards, protect habitat and
watershed resources, and enhance the overall health of the Bay.
The City continually coordinates water-planning activities that support and inform the City’s
creation of this UWMP with neighboring communities and water agencies.
The Water Supply Master Plan
One early example of interagency coordination and planning was the development of the
Water Supply Master Plan (WSMP). From 1996 through 1999, the BAWSCA agencies, the
SFPUC, and the Valley Water worked cooperatively to develop a WSMP. A Palo Alto
representative was on the steering committee for this project. The WSMP is intended to
address the future water supply needs of the water agencies and 2.3 million people, who are
served via the SFPUC water system. On April 25, 2000 the SFPUC formally adopted the WSMP
including the implementation schedule for identified, selected projects.
Integrated Regional Water Management Plan
The Association of Bay Area Government (ABAG) convened a broad-based group of
stakeholders to develop an Integrated Regional Water Management Plan (IRWMP) for the Bay
Area. The Bay Area IRWMP facilitates regional cooperation on issues of water supply, quality
and reliability, water recycling and conservation, storm water and flood water management,
wetlands and habitat restoration and creation, recreation and access.
3 Staff Report CMR:367:05: http://www.cityofpaloalto.org/civicax/filebank/documents/5859
9
The City was involved in the development of the Bay Area IRWMP on the water supply and
reliability areas through BAWSCA’s representation in BAWAC. In addition, the City also
coordinates water recycling and wastewater for the IRWMP implementation through the City’s
membership in the Bay Area Clean Water Agencies (BACWA). The City adopted the 2019 Bay
Area IRWMP in May 2019 4.
BAWSCA Long‐Term Reliable Water Supply Strategy
The BAWSCA agencies identified a need for dry year supplies to meet future demands. The
study, completed in February 2015 identified cost-effective regional and local projects that will
meet individual BAWSCA member needs. One of the projects included in the strategy is the
City’s “Phase 3” recycled water system expansion project to serve the Stanford Research Park.
The recycled water project is described in more detail in the alternative water supplies
discussion and the long-term reliable water supply strategy is described in more detail in the
system supplies discussion.
Palo Alto Regional Water Quality Control Plant Long Range Facilities Plan
The RWQCP has been in operation since 1934 and now serves the six communities of Palo Alto,
East Palo Alto, Mountain View, Stanford, Los Altos and Los Altos Hills. Aging equipment, new
regulatory requirements, and the movement to full sustainability will require rehabilitation,
replacement and new processes. The Long Range Facilities Plan was completed in October
2012. Major recommendations in the plan were modeling influent sewer flows, continuing
source control and flow reduction efforts, rehabilitating and replacing critical infrastructure,
and preparing for regulatory action. In addition, it was recommended the plant be positioned
for a possible increase in recycled water demand by reserving space on site for reverse osmosis
facilities and being prepared to implement additional storage and pumping capabilities.
Northwest County Recycled Water Strategic Plan
The Northwest County Recycled Water Strategic Plan is a collaboration between the City of Palo
Alto and Valley Water that seeks to identify the most appropriate ways to expand the City of
Palo Alto’s Recycled Water Program. The plan evaluated the potential expansion of the
recycled water pipeline to the Stanford Research Park area as well as potable water reuse. The
final plan was accepted by City Council in March 20205.
Valley Water 2040 Water Supply Master Plan
The City participated with other stakeholders in the preparation of a 2040 Water Supply Master
Plan to address long range water supply and reliability needs in Santa Clara County. The Water
4 See Staff Report 10243: https://www.cityofpaloalto.org/civicax/filebank/documents/71249
5 See Staff Report 10319:
https://www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=59282.96&BlobID=75414
10
Supply Master Plan 6 includes an annual Monitoring and Assessment Program (MAP) to provide
a mechanism for adapting to changing supply and demand conditions, climate change,
regulatory and policy changes, other risks, and uncertainty.
Valley Water Countywide Water Reuse Master Plan
The collaboration between Valley Water and the Partner Agencies, including Palo Alto, builds
on existing partnerships, plans, and infrastructure; explores a wide range of reuse opportunities
that support Valley Water’s goals and yields multiple benefits for the collective region.
The City coordinated the 2020 update of the Urban Water Management Plan with the following
agencies:
Table 2: Coordination with Appropriate Agencies
AGENCIES
Participated
in Plan
development
Sent notice
of Plan
preparation
Commented
on the draft
Attended
public
meetings
Contacted
for
assistance
Received
copy of
draft
Sent notice
of public
hearing
Not involved
/ No
information
SFPUC X X X X
BAWSCA X X X X
Valley Water X X X X
City of East Palo
Alto
X X
City of
Mountain View
X X
City of Menlo
Park
X X
Purissima Hills Water
District
X X
City of Redwood
City
X X
Stanford
University
X X
All other
BAWSCA
agencies
X X
County of Santa
Clara
X X
6 See Valley Water’s website: https://www.valleywater.org/your-water/recycled-and-purified-water
11
Section 2 – Service Area
Law
10631
(a) Describe the service area of the supplier, including current and projected population, climate,
and other social, economic, and demographic factors affecting the supplier’s water
management planning. The projected population estimates shall be based upon data from the
state, regional, or local service agency population projections within the service area of the
urban water supplier and shall be in five-year increments to 20 years or as far as data is
available. The description shall include the current and projected land uses within the existing
or anticipated service area affecting the supplier’s water management planning. Urban water
suppliers shall coordinate with local or regional land use authorities to determine the most
appropriate land use information, including, where appropriate, land use information
obtained from local or regional land use authorities, as developed pursuant to Article 5
(commencing with Section 65300) of Chapter 3 of Division 1 of Title 7 of the Government Code.
Demographics
Palo Alto is located in northern Santa Clara County approximately 35 miles south of the City of
San Francisco. The City’s population in 2020 was approximately 69,000 7. The City is roughly 26
square miles in area and is a part of the San Francisco Bay metropolitan area. The City is one of
the area's most desirable residential communities with approximately 28,500 8 housing units.
The City’s desirability is partly due to the excellent public schools, comprehensive municipal
services, shopping, restaurants and the community's aesthetics.
The City is considered the birthplace of the high technology industry and the Silicon Valley.
Located directly adjacent to the City is Stanford University, which attracts major corporations
from around the world. The City's 630-acre Stanford Research Park includes among its tenants
such prestigious and innovative high-tech leaders as Hewlett-Packard, Varian, Tesla Motors,
and VMware. The City has approximately 27 million square feet of non-residential floor-space,
36 parks and preserves (comprising 157 acres of urban parks and 3,752 acres of open space),
tennis courts (51), community centers (4), theaters (3), swimming pools (1), nature centers (3),
athletic centers (4), a golf course, an art center, and a junior museum and zoo 9.
Table 3 shows the population and employment projections for the City from 2020 to 2045
based on the City’s 2030 Comprehensive Plan through 2030 and extrapolated using the same
growth rates through 2045. Fiscal year values were calculated by averaging the two relevant
calendar year values from the plan. The City relied on ABAG population and employment
projections for the 2010 and 2015 UWMPs. According to these projections, expected 2020-
7 City of Palo Alto 2030 Comprehensive Plan with fiscal year values estimated from calendar year values
8 City of Palo Alto 2015-2023 Housing Element
9 City of Palo Alto 2018-2019 Comprehensive Annual Financial Report (CAFR)
12
2045 population growth is about 0.8% per year with expected growth in employment 0.5% per
year. These projections do not consider potential impacts of Covid-19.
Table 3: Population – Current and Projected
Climate Characteristics
The City enjoys a mild climate surrounded by the San Francisco Bay on the east, and coastal
mountains on the west. The monthly average temperature, rainfall and ETO (Reference
Evapotranspiration) for the area are presented in Table 4 below.
Table 4: Climate
Climate
Standard Monthly
Average ETO 10
Average
Rainfall
(inches)11
Average Max
Temperature
(degrees F)12
Average Min
Temperature
(degrees F)
Jan 1.31 3.2 57.4 38.5
Feb 2.69 2.9 61.1 41.3
Mar 2.99 2.3 64.2 43.1
Apr 4.31 1.0 68.4 44.7
May 6.08 0.4 72.9 48.5
Jun 6.88 0.1 77.4 52.5
Jul 6.82 0.0 78.4 54.9
Aug 5.67 0.1 78.4 54.8
Sep 4.01 0.2 78.3 52.6
Oct 3.58 0.7 73.0 48.0
Nov 1.76 1.7 64.3 42.6
Dec 1.10 2.7 57.8 38.2
10 Average ETO data for closest active station (Union city) reported by CIMIS website
http://www.cimis.water.ca.gov/
11 Average rainfall data for Palo Alto reported by NOAA website http://www.wrcc.dri.edu/
12 Average temperature data for Palo Alto reported by NOAA website http://www.wrcc.dri.edu/
2020 2025 2030 2035 2040 2045
Service Area Population 68,819 71,667 74,815 77,963 81,111 84,259
Five Year Percent Increase 4.1% 4.4% 4.2% 4.0% 3.9%
Total Employment 97,654 100,095 102,535 104,975 107,416 109,856
Five Year Percent Increase 2.5% 2.4% 2.4% 2.3% 2.3%
13
Section 3 – System Supplies
Law
10631 (b) Identify and quantify, to the extent practicable, the existing and planned sources of
water available to the supplier over the same five year increments described in subdivision (a)…..
Historical Background
The water utility was established on May 9, 1896, two years after the City was incorporated.
Local water companies were bought out at that time with a $40,000 bond approved by the
voters of the 750-person community. These private water companies operated one or more
shallow wells to serve the nearby residents. The City grew, and the well system expanded until
nine wells were in operation in 1932.
In December 1937, the City signed a 20-year contract with the City and County of San Francisco,
administered by the San Francisco Water Department (SFWD), for water deliveries from the
newly constructed pipeline bringing Hetch Hetchy water from Yosemite to the Bay Area. Water
deliveries from San Francisco commenced in 1938, and well production declined to less than
half of the total citywide water demand.
A 1950 engineering report noted, "the capricious alternation of well waters and the SFWD
water . . . has made satisfactory service to the average consumer practically impossible."
However, groundwater production increased in the 1950s, leading to lower groundwater tables
and water quality concerns. In 1962, a survey of water softening costs to City customers
determined that the City should purchase 100% of its water supply needs from the SFWD. A 20-
year contract was signed with San Francisco, and the City’s wells were placed in a standby
condition. The SFWD later became known as the SFPUC. Since 1962 (except for some very short
periods) the City’s entire supply of potable water has come from the SFPUC.
BAWSCA is comprised of SFPUC’s 26 Wholesale Customers. The City largely works through
BAWSCA to manage its SFPUC contract and to interact with the SFPUC.
Water Integrated Resource Planning
The City prepared its first Water Integrated Resources Plan (WIRP) in 1993 when the City was
faced with a decision to participate in a regional recycled water expansion program. The 1993
WIRP assessed the costs and benefits of the recycled water project compared to other supply
alternatives and ultimately concluded that recycled water was not cost effective relative to
existing supply.
In 2003, the City updated the WIRP. The 2003 WIRP indicated that supplies from the SFPUC
were adequate during normal years, but additional supplies were needed in dry years to avoid
shortages. The key conclusions from the 2003 WIRP analysis were:
14
1. The City’s existing contractual entitlement with the SFPUC provides adequate supplies;
2. The cost to connect to Valley Water’s West Pipeline (WPL) treated water pipeline was
prohibitive;
3. Continuous use of groundwater was not recommended;
4. The City should continue to evaluate recycled water; and
5. Continue the current Demand Side Management programs and explore additional
measures.
The WIRP work was coordinated with infrastructure work by the City to increase the
distribution system reliability. Under a contract with the City, Carollo Engineers completed
several studies of the water distribution system. These studies are discussed in Section 3,
“System Supplies,” under the heading “Groundwater.”
The City and other Santa Clara County water retailers coordinated with Valley Water to
examine extending the West Pipeline (WPL) that currently ends at Miramonte Road and
Foothills Expressway to a point in Palo Alto to serve the City and other neighboring water
agencies. In addition, the study examined creating an intertie between the WPL and the
SFPUC’s Bay Division Pipelines at Page Mill Road. The West Pipeline Conceptual Evaluation,
completed in March 2003, concluded that the conceptual projects were constructible, but that
no decisions could be made until Valley Water concluded additional studies. These ongoing
studies include the Valley Water project to evaluate its system reliability, asset management
program, and Water Treatment Plant Master Plan Project. These studies, completed in the fall
of 2004, concluded that extending the WPL to serve the City could not be justified from a
county-wide reliability aspect when evaluated against more cost-effective alternatives.
The information obtained from the studies completed on the groundwater and Valley Water’s
conceptual study on the WPL Extension was used to characterize the supply options examined
in the WIRP.
Based on the WIRP analysis, the City Council adopted a set of WIRP guidelines in December
200313. The WIRP guidelines include:
1. Preserve and enhance SFPUC supplies;
2. Continue to advocate for an interconnection between SFPUC and Valley Water;
3. Participate in the development of cost effective regional recycled water programs;
4. Scope water conservation programs to comply with Best Management Practices (BMPs);
5. Maintain emergency water conservation measures to be activated in case of droughts;
6. Retain groundwater supply options in case of changed future conditions; and
7. Survey community to determine its preferences regarding the best water resource
portfolio.
13 See City Manager Report 547:03: http://www.cityofpaloalto.org/cityagenda/publish/cmrs/2732.pdf
15
Since the major WIRP conclusion was that SFPUC supplies were adequate except in drought
years, the focus turned to the options to reduce the supply deficit during droughts. These
options include using groundwater, connecting to the Valley Water’s treated water pipeline,
developing recycled water, and expanding water efficiency programs. The goal was to find the
proper balance between the key factors of cost, availability in a drought, water quality, and
environmental impacts in determining the best portfolio for the community.
Following Council’s adoption of the WIRP Guidelines, and to gain insight into the question of
whether to use groundwater as supplemental supply in droughts, the City surveyed its
residential customers. Respondents were asked to rank three options for water supply in a
drought:
A. Blend Groundwater – Blend the groundwater with water from SFPUC in droughts. Water
customers would still need to cut back water usage by 10% in droughts.
B. No Groundwater – Use no groundwater during droughts. Instead, community is
subjected to larger water usage cutbacks in droughts (20% cutback).
C. Treat Groundwater – Highly treat the groundwater (reverse osmosis treatment) before
introducing it into distribution system. Water customers would still need to cut back
water usage by 10% in droughts.
Survey respondents generally preferred Options B (no groundwater) and C (treat groundwater),
but Option A (blend groundwater) was not soundly rejected. Based on the survey, any of the
three options would probably be accepted by the City’s water customers under drought
conditions. The survey did not address whether groundwater may or may not be an acceptable
long-term water supply alternative.
Based on the WIRP and the results of the community survey, staff made the following
conclusions and recommendations in June 2004:
1. Do not install advanced treatment systems for the groundwater at this time. This option
is simply too expensive, both in capital and in operating costs.
2. Blending at an SFPUC turnout is the best way to use groundwater as a supplemental
drought time supply while maintaining good water quality.
3. Staff should await the conclusion of the environmental review process for selecting any
new emergency well sites before developing a recommendation on whether to use
groundwater in droughts. In the selection process for new well sites, the costs for
blending with SFPUC water in droughts should be considered. The least expensive
location is a well at El Camino Park due to its proximity to an SFPUC turnout.
4. Actively participate in the development of long-term drought supply plans with SFPUC
and BAWSCA.
5. Continue in the efforts identified in the Council-approved WIRP Guidelines:
a. Evaluate a range of demand-side management (DSM) options for their ability to reduce
long-term water demands;
b. Evaluate feasibility of expanding the use of recycled water; and
c. Maintain emergency water conservation measures to be activated in case of droughts.
16
In 2017 the WIRP was updated again. Unprecedented drought conditions and regulatory action
by the State Water Resource Control Board (SWRCB), including the first-ever mandatory
potable water use reductions in addition to Palo Alto’s S/CAP renewed the focus on water
supply sustainability. The 2003 WIRP Guidelines served as a roadmap for the City’s for
evaluating the following potable water supply alternatives: 1) water from the SFPUC; 2)
groundwater (with or without groundwater recharge); 3) treated water from the Valley Water;
and 4) DSM. Recycled water was being evaluated outside of the WIRP in a recycled water
strategic planning process.
The evaluation concluded that DSM was the best resource, but could not significantly displace
potable water supplies. While SFPUC water was found to be the most expensive, it has higher
water quality than groundwater or treated water from the Valley Water. In addition,
groundwater and Valley Water treated water supplies may increase in cost and aren’t likely to
offer additional protection in droughts.
Council adopted the following 2017 WIRP Guidelines in March 201714:
1. Pursue all cost-effective water efficiency and conservation;
2. Continue to investigate the technical feasibility and financial impact of increasing the
use of non-traditional, non-potable sources such as black water, storm water, and water
incidentally produced in an excavating project;
3. Proceed with the Recycled Water Strategic Plan to determine how to reduce the
demand for imported water; and
4. Survey potentially impacted customers about their preference for SFPUC water versus
blended water.
Sustainability and Climate Action Plan
In November 2016 Council adopted the Sustainability and Climate Action Plan (S/CAP)
Framework 15 including four water-specific goals, all of which have implications for water reuse:
1. Utilize the right water supply for the right use;
2. Ensure sufficient water quantity and quality;
3. Protect the Bay, other surface waters, and groundwater; and
4. Lead in sustainable water management.
In December 2017, Council adopted the S/CAP Sustainability Implementation Plan (SIP)16. The
SIP identified the following Key Actions:
1. Develop programs and ordinances to maximize water efficiency;
2. Develop programs and ordinances to facilitate the use of non-traditional, non-potable
water sources (e.g. graywater, storm water, black water, etc.);
3. Develop Recycled Water Strategic Plan and explore the most effective uses of recycled
water, both inside and outside Palo Alto;
14 See Staff Report #7634 https://www.cityofpaloalto.org/civicax/filebank/documents/56088
15 See Staff Report #7304 https://www.cityofpaloalto.org/civicax/filebank/documents/60858
16 See Staff Report #8487 https://www.cityofpaloalto.org/civicax/filebank/documents/62406
17
4. Develop a Green Storm Water Infrastructure Plan to better capture and infiltrate storm
water back into the hydrologic cycle; and
5. Reduce salinity of Palo Alto’s recycled water to increase desirability of use.
Northwest County Recycled Water Strategic Plan
Palo Alto Utilities and Public Works staff collaborated with Valley Water to evaluate the most
effective water reuse options within Palo Alto as well as within the RWQCP service area. The
resulting Northwest County Recycled Water Strategic Plan Report and Appendices 17 contains a
summary and ranking of the water reuse alternatives or “Concept Options” based on cost and
non-cost criteria.
Effluent Transfer Agreement
A Council-approved agreement with Valley Water and the City of Mountain View18 gives Valley
Water an option to acquire about half of the treated wastewater produced by the RWQCP,
which would render some local water reuse options infeasible. The Agreement Between and
Among Palo Alto, Mountain View, and the Santa Clara Valley Water District to Advance Resilient
Water Reuse Programs in Santa Clara County is referred to as the Partnership Agreement.
Water reuse alternatives identified in the Northwest County Recycled Water Strategic Plan and
compatible with the Partnership Agreement, traditional potable water supplies, DSM,
stormwater and other non-traditional water supplies will be considered as part of an overall
water resource portfolio in a 2021 “One Water Plan”.
Current and Planned Water Supply Sources
Table 5 below shows the current and planned water supply sources for the City for normal
years. As required by Section 10631(j), this information has been provided to the SFPUC, the
City’s wholesale supplier.
Table 5: Current and Planned Water Supply Sources 19
17 See Staff Report 10913
https://www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=59282.96&BlobID=75414
18 See Staff Report #10627 https://www.cityofpaloalto.org/civicax/filebank/documents/73982
19 SFPUC usage data from BAWSCA Demand Side Management Least Cost Planning Decision Support System (DSS
Model) in combination with an Econometric Model except for 2020 actual usage data
Water Supply Sources (AF)2020 2025 2030 2035 2040 2045
SFPUC 10,921 11,287 11,394 11,546 11,801 12,113
Local Groundwater - - - - - -
Local Surface Water - - - - - -
Recycled Water 316 316 316 316 316 316
Transfers In or Out - - - - - -
Exchanges In or Out - - - - - -
Desalinization - - - - - -
Other Sources - - - - - -
Total 11,237 11,603 11,710 11,862 12,117 12,429
18
SFPUC Supply
Description of SFPUC Regional Water System
Palo Alto receives water from the City and County of San Francisco’s RWS, operated by the
SFPUC. Approximately 85% of this supply is from the Sierra Nevada, delivered through the
Hetch Hetchy aqueducts, and approximately 15% is treated water produced by the SFPUC from
its local watersheds and facilities in Alameda and San Mateo Counties.
The amount of imported water available to the SFPUC’s Retail and Wholesale Customers is
constrained by hydrology, physical facilities and the institutional limitations that allocate the
water supply of the Tuolumne River. Due to these constraints, the SFPUC is very dependent on
reservoir storage to ensure water supply availability in dry years.
The SFPUC serves its retail and wholesale water demands with an integrated operation of local
Bay Area water production and imported water from the Hetch Hetchy Reservoir. In practice,
the local watershed facilities are operated to capture local runoff.
Water Supply Agreement
In July 2009, the Wholesale Customers and San Francisco adopted the Water Supply
Agreement 20 (WSA), which includes a Water Shortage Allocation Plan (WSAP) to allocate water
from the RWS to Retail and Wholesale Customers during system-wide shortages of 20 percent
or less. The WSAP has two components:
1. The Tier One Plan, which allocates water between San Francisco and the Wholesale
Customers collectively; and
2. The Tier Two Plan, which allocates the collective Wholesale Customer share among the
Wholesale Customers.
Tier One Drought Allocations
In July 2009, San Francisco and its wholesale customers in Alameda County, Santa Clara County,
and San Mateo County (Wholesale Customers) adopted the Water Supply Agreement (WSA),
which includes a Water Shortage Allocation Plan (WSAP) that describes the method for
allocating water from the RWS between Retail and Wholesale Customers during system-wide
shortages of 20 percent or less. The WSAP, also known as the Tier One Plan, was amended in
the 2018 Amended and Restated WSA.
20 Palo Alto City Council approved the WSA in June 2009 – See City Manager Report 269:09:
http://www.cityofpaloalto.org/civicax/filebank/documents/15985
19
The SFPUC allocates water under the Tier One Plan when it determines that the projected
available water supply is up to 20 percent less than projected system-wide water purchases.
The following table shows the SFPUC (i.e, Retail Customers) share and the Wholesale
Customers’ share of the annual water supply available during shortages depending on the level
of system-wide reduction in water use that is required. The Wholesale Customers’ share will be
apportioned among the individual Wholesale Customers based on a separate methodology
adopted by the Wholesale Customers, known as the Tier Two Plan, discussed further below.
Level of System‐Wide
Reduction in Water Use
Required
Share of Available Water
SFPUC Share Wholesale Customers Share
5% or less
6% through 10%
11% through 15%
16% through 20%
35.5%
36.0%
37.0%
37.5%
64.5%
64.0%
63.0%
62.5%
The Tier One Plan allows for voluntary transfers of shortage allocations between the SFPUC and
any Wholesale Customer as well as between Wholesale Customers themselves. In addition,
water “banked” by a Wholesale Customer, through reductions in usage greater than required,
may also be transferred.
As amended in 2018, the Tier One Plan requires Retail Customers to conserve a minimum of 5%
during droughts. If Retail Customer demands are lower than the Retail Customer allocation
(resulting in a “positive allocation” to Retail 21) then the excess percentage would be re-
allocated to the Wholesale Customers’ share. The additional water conserved by Retail
Customers up to the minimum 5% level is deemed to remain in storage for allocation in future
successive dry years.
The Tier One Plan will expire at the end of the term of the WSA in 2034, unless mutually
extended by San Francisco and the Wholesale Customers.
The Tier One Plan applies only when the SFPUC determines that a system-wide water shortage
exists and issues a declaration of a water shortage emergency under California Water Code
Section 350. Separate from a declaration of a water shortage emergency, the SFPUC may opt to
request voluntary cutbacks from its Retail and Wholesale Customers to achieve necessary
water use reductions during drought periods.
21 See Water Supply Agreement, Water Shortage Allocation Plan (Attachment H), Section 2.1.
20
Tier Two Drought Allocations
The Wholesale Customers have negotiated and adopted the Tier Two Plan, referenced above,
which allocates the collective Wholesale Customer share from the Tier One Plan among each of
the 26 Wholesale Customers. Tier two is implemented when RWS shortage are between 10%
and 20%. These Tier Two allocations are based on a formula that takes into account multiple
factors for each Wholesale Customer including:
• Individual Supply Guarantee (ISG);
• Seasonal use of all available water supplies; and
• Residential per capita use.
The water made available to the Wholesale Customers collectively will be allocated among
them in proportion to each Wholesale Customer’s Allocation Basis, expressed in millions of
gallons per day (MGD), which in turn is the weighted average of two components. The first
component is the Wholesale Customer’s Individual Supply Guarantee (ISG) , as stated in the
WSA, and is fixed. The second component, the Base/Seasonal Component, is variable and is
calculated using the monthly water use for three consecutive years prior to the onset of the
drought for each of the Wholesale Customers for all available water supplies. The second
component is accorded twice the weight of the first, fixed component in calculating the
Allocation Basis. Minor adjustments to the Allocation Basis are then made to ensure a
minimum cutback level, a maximum cutback level, and a sufficient supply for certain Wholesale
Customers.
The Allocation Basis is used in a fraction, as numerator, over the sum of all Wholesale
Customers’ Allocation Bases to determine each wholesale customer’s Allocation Factor. The
final shortage allocation for each Wholesale Customer is determined by multiplying the amount
of water available to the Wholesale Customers’ collectively under the Tier One Plan, by the
Wholesale Customer’s Allocation Factor.
The Tier Two Plan requires that the Allocation Factors be calculated by BAWSCA each year in
preparation for a potential water shortage emergency. As the Wholesale Customers change
their water use characteristics (e.g., increases or decreases in SFPUC purchases and use of other
water sources, changes in monthly water use patterns, or changes in residential per capita
water use), the Allocation Factor for each Wholesale Customer will also change. However, for
long-term planning purposes, each Wholesale Customer shall use as its Allocation Factor, the
value identified in the Tier Two Plan when adopted.
Per WSA Section 3.11, the Tier One and Tier Two Plans will be used to allocate water from the
RWS between Retail and Wholesale Customers during system-wide shortages of 20% or less.
For RWS shortages in excess of 20%, San Francisco shall (a) follow the Tier 1 Shortage Plan
allocations up to the 20% reduction, (b) meet and discuss how to implement incremental
reductions above 20% with the Wholesale Customers, and (c) make a final determination of
allocations above the 20% reduction. After the SFPUC has made the final allocation decision,
21
the Wholesale Customers shall be free to challenge the allocation on any applicable legal or
equitable basis. For purposes of the 2020 UWMPs, for RWS shortages in excess of 20%, the
allocations among the Wholesale Customers is assumed to be equivalent among them and to
equal the drought cutback to Wholesale Customer by the SFPUC. For this 2020 UWMP it is
assumed the Tier Two Plan will be used to allocate supplies available to Wholesale Customers
when average Wholesale Customers’ RWS shortages are greater than 10% and up to 20% . An
equal percent reduction is assumed to be shared across all Wholesale Customers when average
Wholesale Customers’ RWS shortages are 10% or less or greater than 20%.
The Tier Two Plan, which initially expired in 2018, has been extended by the BAWSCA Board of
Directors every year since for one additional calendar year. In November 2020, the BAWSCA
Board voted to extend the Tier Two Plan through the end of 2021.
Individual Supply Guarantee
San Francisco has a perpetual commitment (Supply Assurance) to deliver 184 MGD to the 24
permanent Wholesale Customers collectively. San Jose and Santa Clara are not included in the
Supply Assurance commitment and each has temporary and interruptible water supply
contracts with San Francisco. The Supply Assurance is allocated among the 24 permanent
Wholesale Customers through ISGs, which represent each Wholesale Customer’s allocation of
the 184 MGD Supply Assurance. Palo Alto’s ISG is 16.575 MGD, or approximately 18,579 acre
feet per year. The City’s ISG was reduced to this level in May 2018 upon a permanent ISG
transfer of 0.5 MGD to the City of East Palo Alto 22.
2018 SFPUC Decisions Extended to 2028
In the 2009 WSA, the SFPUC committed to make three decisions before 2018 that affect water
supply development:
• Whether or not to make the cities of San Jose and Santa Clara permanent customers,
• Whether or not to supply the additional unmet supply needs of the Wholesale
Customers beyond 2018, and
• Whether or not to increase the wholesale Customer Supply Assurance above 184 MGD.
Events since 2009 made it difficult for the SFPUC to conduct the necessary water supply
planning and CEQA analysis required to make these three decisions before 2018. Therefore, in a
2018 WSA contract amendment 23, the decisions were deferred for 10 years to 2028.
22 See Staff Report #9041 https://www.cityofpaloalto.org/civicax/filebank/documents/64801
23 See Staff Report #9999
https://www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=46434.97&BlobID=69371
22
SFPUC Water Supply Alternative Evaluation Efforts
There have been recent changes to instream flow requirements and customer demand
projections that have affected water supply planning beyond 2018. As a result, the SFPUC has
established an Alternative Water Supply Planning program to evaluate several regional and
local water supply options. Through this program, the SFPUC will conduct feasibility studies and
develop an Alternative Water Supply Plan by July 2023 to support the continued development
of water supplies to meet future needs. More detail regarding the SFPUC’s alternative water
supply efforts is provided in Section 6, Water Supply Reliability.
BAWSCA and Its Role
BAWSCA provides regional water reliability planning and conservation programming for the
benefit of its 26 member agencies that purchase wholesale water supplies from the San
Francisco Public Utilities Commission (SFPUC). Collectively, the BAWSCA member agencies
deliver water to over 1.8 million residents and nearly 40,000 commercial, industrial and
institutional accounts in Alameda, San Mateo and Santa Clara Counties.
BAWSCA also represents the collective interests of these wholesale water customers on all
significant technical, financial, and policy matters related to the operation and improvement of
the SFPUC’s Regional Water System (RWS).
BAWSCA’s role in the development of the 2020 Urban Water Management Plan (UWMP)
updates is to work with its member agencies and the SFPUC to seek consistency among
UWMP documents.
As a member of BAWSCA, the City is formally represented on the BAWSCA Board of Directors
on matters involving decision-making, policy setting and issues of interest to the BAWSCA
members. City staff participates in several advisory and policy committees, including the Water
Quality Committee and the Water Resources Committee. Staff also represents the City with the
other BAWSCA members on other issues that may arise from time to time.
Regional Water Demand and Conservation Projections
In June 2020, BAWSCA completed the Regional Water Demand and Conservation Projections
Report (Demand Study).24 The goal of the Demand Study was to develop transparent,
defensible, and uniform demand and conservation savings projections for each Wholesale
Customer using a common methodology to support both regional and individual agency
planning efforts and compliance with the new statewide water efficiency targets required by
Assembly Bill (AB) 1668 and Senate Bill (SB) 606.
Through the Demand Study process, BAWSCA and the Wholesale Customers (1) quantified the
total average-year water demand for each BAWSCA member agency through 2045, (2)
quantified passive and active conservation water savings potential for each individual
24 Phase III Final Report: http://bawsca.org/uploads/pdf/BAWSCA_Regional_Water_Demand_and_
Conservation%20Projections%20Report_Final.pdf
23
Wholesale Customer through 2045, and (3) identified 24 conservation programs with high
water savings potential and/or member agency interest. Implementation of these conservation
measures, along with passive conservation, is anticipated to yield an additional 37.3 MGD of
water savings by 2045. Based on the revised water demand projections, the identified water
conservation savings, increased development and use of other local supplies by the Wholesale
Customers, and other actions, the collective purchases of the BAWSCA member agencies from
the SFPUC are projected to stay below 184 MGD through 2045.
As part of the Demand Study, each Wholesale Customer was provided with a demand model
that can be used to support ongoing demand and conservation planning efforts, including
UWMP preparation.
Long‐Term Reliable Water Supply Strategy
BAWSCA’s Long-Term Reliable Water Supply Strategy (Strategy), completed in February 2015,
quantified the water supply reliability needs of the BAWSCA member agencies through 2040,
identified the water supply management projects and/or programs (projects) that could be
developed to meet those needs, and prepared an implementation plan for the Strategy’s
recommendations.
When the 2015 Demand Study concluded, it was determined that while there is no longer a
regional normal year supply shortfall, there was a regional drought year supply shortfall of up
to 43 MGD. In addition, key findings from the Strategy's project evaluation analysis included:
• Water transfers represent a high priority element of the Strategy;
• Desalination potentially provides substantial yield, but its high effective costs and
intensive permitting requirements make it a less attractive drought year supply
alternative; and
• Other potential regional projects provide tangible, though limited, benefit in reducing
dry-year shortfalls given the small average yields in drought years.
Since 2015, BAWSCA has completed a comprehensive update of demand projections and
engaged in significant efforts to improve regional reliability and reduce the dry-year water
supply shortfall.
Water Transfers. BAWSCA successfully facilitated two transfers of portions of Individual Supply
Guarantee (ISG) between BAWSCA agencies in 2017 and 2018. Such transfers benefit all
BAWSCA agencies by maximizing use of existing supplies. BAWSCA is currently working on an
amendment to the Water Supply Agreement between the SFPUC and BAWSCA agencies to
establish a mechanism by which member agencies that have an ISG may participate in
expedited transfers of a portion of ISG and a portion of a Minimum Annual Purchase
Requirement. In 2019, BAWSCA participated in a pilot water transfer that, while ultimately
unsuccessful, surfaced important lessons learned and produced interagency agreements that
will serve as a foundation for future transfers. BAWSCA is currently engaged in the Bay Area
24
Regional Reliability Partnership 25 (BARR), a partnership among eight Bay Area water utilities
(including the SFPUC, Alameda County Water District, BAWSCA, Contra Costa Water District,
Santa Clara Valley Water District) to identify opportunities to move water across the region as
efficiently as possible, particularly during times of drought and emergencies.
Regional Projects. Since 2015, BAWSCA has coordinated with local and State agencies on
regional projects with potential dry-year water supply benefits for BAWSCA’s agencies. These
efforts include storage projects, indirect/direct water reuse projects, and studies to evaluate
the capacity and potential for various conveyance systems to bring new supplies to the region.
BAWSCA continues to implement the Strategy recommendations in coordination with BAWSCA
member agencies. Strategy implementation will be adaptively managed to account for
changing conditions and to ensure that the goals of the Strategy are met in an efficient and
cost-effective manner. On an annual basis, BAWSCA will reevaluate Strategy recommendations
and results in conjunction with development of the BAWSCA’s FY 2021-22 Work Plan. In this
way, actions can be modified to accommodate changing conditions and new developments.
Making Conservation a Way of Life Strategic Plan
Following the 2014-2016 drought, the State of California (State) developed the “Making Water
Conservation a California Way of Life” framework to address the long-term water use efficiency
requirements called for in executive orders issued by Governor Brown. In May of 2018, AB
1668 and SB 606 (collectively referred to as the efficiency legislation) went into effect, which
built upon the executive orders implementing new urban water use objectives for urban retail
water suppliers.
BAWSCA led its member agencies in a multi-year effort to develop and implement a strategy to
meet these new legislative requirements. BAWSCA’s Making Conservation a Way of Life
Strategic Plan (Strategic Plan) provided a detailed roadmap for member agencies to improve
water efficiency. BAWSCA implementing the following elements of the Strategic Plan:
• Conducted an assessment of the agencies’ current practices and water industry best
practices for three components of the efficiency legislation that, based on a
preliminary review, present the greatest level of uncertainty and potential risk to the
BAWSCA agencies. The three components were:
1. Development of outdoor water use budgets in a manner that incorporates
landscape area, local climate, and new satellite imagery data;
2. Commercial, Industrial, and Institutional water use performance measures and
3. Water loss requirements.
25 https://www.bayareareliability.com/
25
• Organized an Advanced Metering Infrastructure symposium to enable information
exchange, including case studies, implementation strategies, and data analysis
techniques.
• Initiated a regional Commercial, Industrial and Institutional (CII) audit pilot program,
which BAWSCA aims to complete in 2021.26
• Implemented a regional program for water loss control to help BAWSCA agencies
comply with regulatory requirements and implement cost‐effective water loss
interventions.
• Engaged with the SFPUC to audit meter testing and calibration practices for SFPUC’s
meters at BAWSCA agency turnouts.
Finally, BAWSCA's Demand Study developed water demand and conservation projections
through 2045 for each BAWSCA agency. These projects are designed to provide valuable
insights on long-term water demand patterns and conservation savings potential to support
regional efforts, such as implementation of BAWSCA’s Long-Term Reliable Water Supply
Strategy.
Alternative Water Supply Analysis
In anticipation of extended periods of drought and possible regulatory changes by the State,
the City is evaluating a wide range of alternative water supplies. The Northwest County
Recycled Water Strategic Plan, completed in collaboration with Valley Water, identified and
evaluated a number of potable and non-potable water reuse concept options using effluent
from the RWQCP in Palo Alto. Concept options that are compatible with the effluent transfer
agreement with Valley Water will be considered along with traditional potable supply sources,
demand management, green stormwater infrastructure, and graywater in a holistic 2021 “One
Water” Plan. In addition, the City, through BAWSCA, has additional water supply management
opportunities. Each is discussed in more detail below.
Transfer or Exchange Opportunities
Law
10631 (d) Describe the opportunities for exchanges or transfers of water on a short-term or long-
term basis.
26 Efforts on the CII audit pilot program stalled in March 2020 due to the COVID 19 pandemic and related shelter-in-place
orders.
26
Because the existing San Francisco Regional Water System (RWS) does not have sufficient
supplies in dry years, dry-year water transfers are potentially an important part of future water
supplies. As a result, in February 2011, the Palo Alto City Council approved a new Tier Two Plan
to allocate water between the BAWSCA members. This plan includes the ability to transfer
water allocated to the BAWSCA agencies between BAWSCA members during drought periods.
All the BAWSCA agencies adopted the Plan by April 2011. The Water Shortage Contingency Plan
and SFPUC Supply sections provide further detail on The Tier Two Plan.
BAWSCA investigated water transfer opportunities as part of the Long Term Reliable Water
Supply Strategy discussed above. The recent historic drought led to capacity and regulatory
issues that made pilot transfers infeasible.
Groundwater
Law
10631 (4) If groundwater is identified as an existing or planned source of water available to the
supplier, all of the following information:
(A) The current version of any groundwater sustainability plan or alternative adopted
(B) A description of any groundwater basin or basins from which the urban water supplier pumps
groundwater.
(C) A detailed description and analysis of the location, amount, and sufficiency of groundwater
pumped by the urban water supplier for the past five years.
(D) A detailed description and analysis of the amount and location of groundwater that is
projected to be pumped by the urban water supplier.
Deep Aquifer Groundwater
The City is located in Santa Clara County. Valley Water is the groundwater management agency
in Santa Clara County as authorized by the California legislature under the Santa Clara Valley
Water District Act, California Water Code Appendix, Chapter 60.
In September 2014, Governor Brown signed the Sustainable Groundwater Management Act
(SGMA) to promote the local, sustainable management of groundwater supplies. SGMA
requires sustainable groundwater management for all medium and high priority basins in
California. SGMA identifies Valley Water 27 as the exclusive groundwater management agency
for Santa Clara County. The District actively manages the Santa Clara sub-basin, designated as
medium priority by the California Department of Water Resources. The groundwater basins in
Santa Clara County are not adjudicated nor have the basins been identified by the Department
of Water Resources as being in overdraft.
The 2016 Groundwater Management Plan for the Santa Clara and Llagas Subbasins (GWMP)
describes Valley Water’s groundwater sustainability goals, and the strategies, programs, and
27 Valley Water Groundwater Sustainability Plan: https://www.valleywater.org/your-water/where-your-water-
comes-from/groundwater/sustainable-groundwater-management
27
activities that support those goals. Following a public hearing, Valley Water’s Board of Directors
adopted the GWMP on Nov. 22, 2016. The GWMP was submitted to DWR as an Alternative on
Dec. 21, 2016. On July 17, 2019, DWR approved the Alternative for both the Santa Clara and
Llagas Subbasins, determining it satisfies the objectives of SGMA. DWR also proposed five
recommended actions for Valley Water’s consideration: identify groundwater dependent
ecosystems, incorporate climate change analysis in the water budget, create separate water
quality outcome measures for each subbasin, clarify quantifiable outcome measures, and
develop a seawater intrusion outcome measure.
Although groundwater resources, including in South Santa Clara County, were heavily relied
upon during the recent drought, groundwater levels throughout the county are generally good,
as potable water demand has been reduced and as Valley Water efforts to prevent
groundwater basin overdraft, curb land surface subsidence, and protect water quality have
been largely successful.
The groundwater quality of the City’s wells is considered fair to good quality, though
significantly less desirable in comparison to SFPUC’s supplies. The groundwater is
approximately six times higher in total dissolved solids (TDS) and hardness than SFPUC’s
supplies. The City has not pumped groundwater since 1991, and, although not a planned future
water supply source, groundwater is an available alternative that is evaluated and reviewed on
a regular basis.
Five wells were constructed in Palo Alto in the mid-1950s and were operated continuously until
1962. In 1988, the wells were operated to provide supplemental supplies while SFPUC
implemented mandatory rationing. Two of the wells were operated for about a month and a
half in 1991 when it appeared that the City was facing a severe (45%) cutback requirement.
Besides normal annual operational testing, the wells have not been used since 1991.
The five older wells were rehabilitated and three new wells and a 2.5 million gallon storage
reservoir and associated pump station were constructed between 2009 and 2013 as part of the
Emergency Water Supply and Storage Project. The primary goal was to correct the deficiency in
the City’s emergency water supply. The well system can now support a minimum of eight hours
of normal water use at the maximum day demand level and four hours of fire suppression at
the design fire duration level. The groundwater system may also be used to a limited extent for
water supply during drought conditions (up to 1,500 acre feet per year) and is capable of
providing normal wintertime supply needs during extended shutdowns of the SFPUC system.
Up to 11,000 gpm of reliable well capacity is available for emergency use as well as 13 million
gallons (MG) of storage. Figure 1 shows the potential groundwater use area in the City’s service
territory.
28
Figure 1: Potential Groundwater Use Area
29
In April 2010, the California Department of Public Health 28 (CDPH) approved a permit
amendment to add the new Library/Community Center Well and the Eleanor Pardee Park Wells
to the City’s existing water supply permit. CDPH permitted the new El Camino Park well in 2014.
As part of the permit process, all three wells were tested for primary and secondary drinking
water quality standards. The results of the test indicate the wells currently meet primary and
secondary water quality standards, but the potential remains for exceedance of secondary
standards for manganese, iron and TDS. The wells are planned to remain as standby sources,
and no additional treatment to ensure compliance with secondary standards is required at this
point. In an emergency situation, the City can provide emergency chlorination treatment at
several of the well sites, including the Library/Community, Eleanor Pardee, Hale, Peers, and
Rinconada wells.
The City has identified the wells as a potential supply source for use during a prolonged
drought. All wells are currently permitted and designated by the California Department of
Public Health as “Standby” and, as such, can only be used for 5 consecutive days up to 15 days
in a year. The wells may collectively supply up to 1,500 AFY during a drought 29.
The pumping restrictions for the well system are mitigation measures in the EIR prepared for
the Emergency Water Supply and Storage Project. Any increase in the current restriction could
require new or supplemental environmental review. The process to increase the current
limitation will require supporting information on the sustainable yield of the groundwater basin
in order to demonstrate increased pumping by the City will not have significant impacts.
If the wells were to be used as a dry year supply option, coordination with CDPH would be
needed to ensure necessary treatment is in place to meet regulatory standards. In addition,
several other issues need to be addressed prior to the use of the wells during a drought,
including the capital costs of any treatment or blending upgrades, water quality compared to
the City’s SFPUC source and customer acceptance, Valley Water groundwater production costs,
and the exact mechanism for how groundwater would form a part of any drought response
portfolio.
Groundwater may hold some advantages in the long term for the City and may be useful during
water supply shortage events. However, a water supply portfolio that includes potable
groundwater does not benefit under the type of potable water reductions mandated by the
State Water Resources Control Board (SWRCB) in 2015. Under those regulations, the City was
required to reduce potable water consumption by 24% regardless of the supply source.
Likewise, Valley Water, requests reductions in groundwater pumping during dry periods.
28 CDPH issues and has the authority to revise domestic water supply permits pursuant to Health and Safety Code
section 116525 (City of Palo Alto permit #4210009 and # 4310009)
29 Final EIR, City of Palo Alto Emergency Water Supply and Storage Project, SCH #2006022038
30
One of the Northwest County Recycled Water Strategic Plan objectives was to gain a better
understanding of the hydrology in northwest Santa Clara County. To that end, the Groundwater
Use Assessment (GUA)30 was completed including the development of a robust model of the
shallow and deep aquifers, particularly focusing on potential recharge zones and the
connectivity between the aquifers. The study concluded that Palo Alto could sustainably rely
on groundwater at a rate of approximately 3,000 AFY, or for about 25% of 2040 potable water
demands. Results of this effort were also used to evaluate the potential for Indirect Potable
Reuse and may be used to demonstrate sustainable yield for a supplemental environmental
review to pump more than 1,500 AFY should Palo Alto plan to incorporate groundwater into its
supply portfolio.
Shallow Aquifer Groundwater
The shallow and deep aquifer research included in the GUA provided valuable insight to the
relationship between the aquifers in the northwest part of Santa Clara County. The study found
that, near the bay, a confining layer separates the deep and shallow aquifers. Further west,
toward the foothills, the two aquifers exhibit connectivity.
Basement construction is often required for non-residential, mixed use and multifamily
residential buildings, particularly if underground parking is involved. Additionally, the high
value of land and housing in the City has resulted in more residential property owners seeking
to increase the size of their single family homes by constructing basements. Basement
construction groundwater pumping occurs when a basement is constructed in areas of shallow
groundwater, typically in the neighborhoods closer to the bay or near current or former creek
beds. Dewatering continues until enough of the house has been constructed to keep the
basement in place, typically 10 weeks. Longer term pumping removes seepage for older
underground structures such as the CalTrain underpass on Oregon Expressway.
Temporary groundwater dewatering from July 2019 to August 2020 produced over 461 AF.
When discharged to the City’s storm drain system, groundwater from dewatering activities
enters one of four creeks that discharges to the Bay. Most dewatering sites discharge to creeks
that have been channelized and offer negligible groundwater recharge opportunities. San
Francisquito Creek is the only creek in the City with potential to recharge the shallow
groundwater basin because it is not channelized within the City boundaries.
The City of Palo Alto issues permits for temporary and long-term (greater than 1 year)
dewatering. The drought and resulting water use restriction increased public concern over
basement construction groundwater pumping in Palo Alto. Concerns range from the apparent
wasting of water by discharging to storm drains, to potential impacts on groundwater elevation
and flow volume, to potential impacts on neighboring properties, such as subsidence and
structure cracks, and impacts on trees and other landscaping.
30 See full GUA report: https://cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=64573.3&BlobID=68051
31
The City has long regulated several aspects of basement groundwater pumping for both
residential and commercial sites. Public concerns regarding dewatering prompted City Council
to approve several enhancements to the dewatering policy that were codified in the Palo Alto
Municipal Code and went into effect in May 2017. Another iteration of requirements went into
effect in February 2018 31.
The goals of the requirements are improving the prediction of the amount of pumped
groundwater, decreasing impacts to surrounding structures and infrastructure, addressing
traffic impacts during the construction period, and minimizing impacts to the area’s
groundwater quantity and quality as well as the quality of downstream water bodies. A
summary of the requirements is listed below:
1. Fill stations are required so that others may fill water trucks or connect garden hoses for
irrigation;
2. Use plans are required to demonstrate that the applicant/builder is arranging for use of
as much of the pumped water as possible and minimizing storm drain discharge;
3. A Geotechnical Study is required to determine any potential effects and needed
avoidance measures; and
4. Street Work/Dewatering permits are required (and are issued after requirements #1, #2
and #3 are completed).
In November 2020, a technical memo 32 evaluating the reuse of dewatering water was
completed. While groundwater pumped from the basement dewatering is, in general, of
suitable quality to be used for irrigation after treatment in a settling tank and is equivalent to
about 12% of irrigation needs in Palo Alto in a typical year, the study identified limitations to
reusing large volumes of dewatering water. The study found it is not feasible to use all of the
groundwater for irrigation due to the high number of daily truck trips that would be required to
haul it to irrigation sites. Approximately 2.8 AF per year, or less than 1% of Citywide irrigation
needs, could potentially be reused for irrigation but at a significant cost in dollars and
greenhouse gas emissions.
Water Recycling
Wastewater Collection and Treatment in Palo Alto
Law
10633. The plan shall provide, to the extent available, information on recycled water and its
potential for use as a water source in the service area of the urban water supplier. The preparation
31 See Staff Report 8580: https://www.cityofpaloalto.org/civicax/filebank/documents/62404
32 See Technical Memo:
https://www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=64014.74&BlobID=79884
32
of the plan shall be coordinated with local water, wastewater, groundwater, and planning agencies
that operate within the supplier’s service area, and shall include all of the following:
(a) A description of the wastewater collection and treatment systems in the supplier’s service
area, including a quantification of the amount of wastewater collected and treated…
(b) A description of the quantity of treated wastewater that meets recycled water standards, is
being discharged, and is otherwise available for use in a recycled water project.
The City operates RWQCP, a wastewater treatment plant, for the East Palo Alto Sanitary
District, Los Altos, Los Altos Hills, Mountain View, Palo Alto, and Stanford University.
Wastewater from these communities is treated by the RWQCP prior to discharge to the Bay.
Approximately 220,000 people live in the RWQCP service area. Of the wastewater flow to the
RWQCP, about 60 percent is estimated to come from residences, 10 percent from industries,
and 30 percent from commercial businesses and institutions.
The RWQCP is a Class V tertiary treatment facility featuring preliminary treatment (barscreens
and grit removal), primary treatment (sedimentation settling), secondary treatment (fixed film
reactors, conventional activated sludge, and clarification), and tertiary treatment (filtration
through a sand and coal filter), and UV disinfection. After tertiary treatment, title 22 recycled
water is produced through further filtration of tertiary effluent through sand filters at low
loading rates and then disinfected with sodium hypochlorite (instead of UV disinfection).
Through these treatments, 99% of ammonia, organic pollutants, and solid pollutants are
removed.
The RWQCP has an average dry weather flow design capacity of 39 MGD (43,680 AF/Y) with full
tertiary treatment, and a peak wet weather flow capacity of 80 MGD (89,600 AF/Y) with full
secondary treatment. Current 2020 average flows are approximately 17.24 MGD (19,311 AF/Y).
The plant capacity is sufficient for current dry and wet weather loads and for future load
projections. There are no plans for expansion of the plant or to “build-out” the plant. New
treatment technologies that will add nitrogen removing capabilities are being planned for
installation and availability in approximately 2025 as part of a new Secondary Treatment
Upgrades project that will address anticipated state nitrogen limits on regional effluent
discharges. In any case, the total hydraulic capacity of the plant will remain unchanged after
completion of the Secondary Treatment Upgrades project.
The plant's discharge meets very high standards to protect South San Francisco Bay. The quality
of the water leaving the plant approaches the standards for drinking water. Table 6 provides
flow data for the RWQCP. A full description of the treatment facility is included in the 1992
Water Reclamation Master Plan and the 2012 Long Range Facilities Plan 33.
33 See document: https://www.cityofpaloalto.org/civicax/filebank/documents/32042
33
Table 6: Wastewater Treatment
Treatment
Plant Name
Location
(City)
Average
Daily Flow
(2020)
Maximum
Daily Flow
(2020)
Year of
Planned
Build‐out
Planned Maximum Daily
Volume
RWQCP City of
Palo Alto
19,311
AF/year
17.24 MGD
24,878
AF/year
22.21
MGD
Plant built
out
90,000 AF/year = Maximum
Design Daily Flow
44,000 AF/year = Average Design
Daily Flow (Dry weather capacity)
Palo Alto Recycled Water Production
As shown in Table 7, the plant has capability to produce recycled water that meets the Title 22
unrestricted use standard (approximately 4.5 MGD of capacity). Current annual production is
about 14% of capacity while peak summer monthly production is about 30% of capacity; peak
hour summer demand uses nearly 100% of production capacity in conjunction with storage
tanks to address limitations in the 4.5 MGD production capacity.
Table 7: Wastewater Collected and Treated – AF
Disposal of Wastewater
Current and future City of Palo RWQCP discharges of treated wastewater to the San Francisco
Bay are shown in Table 8.
Table 8: Disposal of Wastewater (non‐recycled) – AF
Recycled Water Current and Potential Use
Law
10633. The plan shall provide, to the extent available, information on recycled water and its
potential for use as a water source in the service area of the urban water supplier. The preparation
of the plan shall be coordinated with local water, wastewater, groundwater, and planning agencies
that operate within the supplier’s service area, and shall include all of the following:
(c) A description of the recycled water currently being used in the supplier's service area, including
but not limited to, the type, place and quantity of use.
(d) A description and quantification of the potential uses of recycled water, including, but not
limited to, agricultural irrigation, landscape irrigation, wildlife habitat enhancement, wetlands,
2020 2025 2030 2035 2040 2045
Waste Water Collected and Treated 19,311 19,311 19,311 19,311 19,311 19,311
Recycled Water Available if Full Capacity is Used 5,041 5,041 5,041 5,041 5,041 5,041
Method of Disposal 2020 2025 2030 2035 2040 2045
Discharged to San Francisco Bay 16,814 16,814 16,814 16,814 16,814 16,814
Discharged to Bay by way of Emily Renzel Marsh 1,043 1,043 1,043 1,043 1,043 1,043
34
industrial reuse, groundwater recharge, and other appropriate uses, and a determination with
regard to the technical and economic feasibility of serving those uses.
(e) The projected use of recycled water within the supplier's service area at the end of 5, 10, 15,
and 20 years and a description of the actual use of recycled water in comparison to uses previously
projected pursuant to this subdivision.
Current Recycled Water Use
Phase 1 of the RWQCP’s regional recycled water system has been in operation since 1980. It
serves the Palo Alto Golf Course, Greer Park, the Emily Renzel Marsh, and the RWQCP. In 2009
the City completed a project to replace an existing deteriorating pipeline to Shoreline Golf
Course in Mountain View and to extend the pipeline to the Mountain View-Moffett area. The
pipeline replacement restored the golf course connection and provides recycled water services
to the Shoreline community. City of Palo Alto Utilities (CPAU) paid $1 million of the cost for this
pipeline to ensure the pipeline will be sized to meet possible future needs in the City. In
addition, CPAU has committed to pay another $1 million if and when it taps into the new
pipeline.
The recycled water produced by the RWQCP in FY 2020 was used for the following:
• Trucked water mostly for irrigation with some construction dust control (4 AF)
• Irrigation water for Palo Alto Parks (36 AF)
• Irrigation water for the Palo Alto Municipal Golf Course (250 AF)
• Irrigation water for the RWQCP (2 AF)34
• Water for the Duck Pond (25 AF)
• Irrigation water for CalTrans freeway landscape medians (1 AF)
In addition:
• Tertiary water is used for industrial processes at the plant itself using sub-Title 22 plant
effluent. The amount of industrial use recycled water that replaces potable water for this
use is 696 AF.
• The pipeline serving Shoreline Park and other customers in Mountain View (442 AF)
Actual recycled water use in Palo Alto in 2020 was lower than the projection in the 2015 UWMP
(316 AF versus 850 AF). Process water for use at the RWQCP was incorrectly counted in total
recycled water use in the 2015 UWMP. Those volumes have been removed from the recycled
water totals and identified separately in the 2020 UWMP.
Potential Recycled Water Use
Palo Alto completed a Water Reclamation Master Plan (Master Plan) for the Palo Alto RWQCP
in 1992 (Brown and Caldwell 1992) and the accompanying Final Program Environmental Impact
Report (EIR) in 1995 (CH2MHill 1995). The Master Plan and program-level EIR evaluated the
34 This is an estimated unmetered amount for landscaping inside the Palo Alto RWQCP and for that reason is
excluded from actual and projected recycled water estimates in this UWMP.
35
development of a regional water reuse system that could ultimately provide service to the
entire RWQCP service area. The Master Plan includes a phased approach to the expansion of
treatment, distribution, storage, and use of recycled water. The City did not pursue any of the
recommended expansion stages of a water recycling system as the cost of the projects could
not be justified.
In 2005, the City engaged a consultant to complete a Recycled Water Market Survey (Market
Survey). Completed in 2006 35, the objectives of the study were to review and update the list of
potential recycled water users identified in the 1992 Master Plan and to update the estimated
recycled water use potential and the cost estimates for the delivery of recycled water. The
Market Survey included site investigations, market analysis, conceptual project design, and
preparation of a preliminary financing and revenue plan.
In December 2008, the City completed the Recycled Water Facility Plan investigating the
expansion of the regional recycled water system to serve areas in Palo Alto 36. As described in
the narrative regarding potential future uses for recycled water, in September 2015, City
Council certified the project EIR for the expansion of the City’s recycled water system to serve
the Stanford Research Park.
On September 28, 2015 the Palo Alto City Council adopted a resolution certifying the EIR for an
expansion of the existing recycled water distribution system 37. The primary objectives of
extending the recycled water pipeline would be:
1. To allow the City to maximize recycled water as a supplemental water source, thereby
improving potable water supply reliability by conserving drinking water, which is
currently used for irrigation and other non-potable uses;
2. To provide a dependable, drought-proof locally controlled non-potable water source;
3. To increase recycled water use from the RWQCP and reduce discharge to San Francisco
Bay; and
4. To reduce reliance on imported water.
In 2019, the Northwest County Recycled Water Strategic Plan was undertaken in collaboration
with Valley Water to assess drought-proof recycled water expansion opportunities throughout
the RWQCP service territory. One element was a business plan for the Phase 3 Expansion
Project. Phase 3 is a non-potable water pipeline extending the current recycled water
35 The report was provided to the UAC in October 2006 and the Council in November 2006:
http://www.cityofpaloalto.org/cityagenda/publish/uac-
meetings/documents/Item1AttachmentARecycledWaterMarketSurveyfinalreport.pdf
36 Report provided to the UAC in March 2009: http://www.cityofpaloalto.org/civicax/filebank/documents/14932.
The executive summary of the report provided to Council in April 2009 in informational Staff Report 203:09:
http://www.cityofpaloalto.org/civicax/filebank/documents/15501
37 See Staff Report 6071: http://www.cityofpaloalto.org/civicax/filebank/documents/49059
36
distribution system to the Stanford Research Park. The Business Plan38 presented the costs,
benefits and budgetary impacts of the project.
The map below shows an overview of the project alignment.
Figure 2: Phase 3 Recycled Water Expansion Project Overview
The need for external funding was identified as a key component of making the project
economically feasible. Phase 3 and variations of it were included in the larger strategic plan.
38 See Utilities Advisory Commission Report: https://www.cityofpaloalto.org/civicax/filebank/documents/65978
37
The Northwest County Recycled Water Strategic Plan identified, summarized and ranked water
reuse alternatives or “Concept Options” based on cost and non-cost criteria. The list included
non-potable, satellite non-potable, indirect potable, and direct potable reuse options. The GUA
was relied upon to assess the indirect potable reuse options.
The plan concluded that multiple water reuse opportunities are feasible for Palo Alto to meet
both near-term and long-term water demands. Near-term opportunities, those that could be
implemented within five years, include non-potable reuse program expansion projects and
satellite treatment for non-potable reuse projects. In contrast, long-term opportunities that
could be implemented include indirect potable reuse within 10-20 years and direct potable
reuse implementation within 20-40 years. The opportunities are not all explicitly distinct from
each other.
The satellite non-potable reuse project was found to be cost-prohibitive. Indirect potable reuse
and large-scale direct potable reuse in Palo Alto are not compatible with the Partnership
Agreement because the reduced effluent availability will render those projects infeasible.
However, a number of non-potable projects and small-scale direct potable reuse were found to
be compatible with the Partnership Agreement described below and will be considered as part
of a “One Water Plan” in 2021.
The potential uses in Palo Alto for recycled water are shown in Table 9below. The table shows
current use continuing for 2020. The potential landscape use increase starting in 2025 in Table
9reflects the possibility of the Phase 3 recycled water system expansion.
Table 9: Potential Future Use of Recycled Water in Palo Alto‐ AFY
Regional Collaboration
The Partnership Agreement, approved by Palo Alto’s council on November 18, 2019, addresses
multiple objectives including diverting treated wastewater discharge from the Bay, increasing
the use of treated wastewater from the RWQCP, and displacing potable imported water where
appropriate and feasible. The Partnership Agreement is comprised of three main elements:
1. Valley Water will contribute $16 million, of an approximately $20 million total cost, to
design and construct a small salt removal facility at the RWQCP in Palo Alto to improve
the quality of non-potable recycled water used in Palo Alto and Mountain View. The
Treatment
Agriculture 0 0 0 0 0 0
Landscape (no golf courses) 42 1,142 1,142 1,142 1,142 1,142
Golf Course 250 250 250 250 250 250
Industrial - - - - - -
Groundwater Recharge - - - - - -
Palo Alto Duck Pond 25 25 25 25 25 25
Total 316 1,416 1,416 1,416 1,416 1,416
Tertiary
treatment plus
additional
disinfection (Title
22 unrestricted
use standard)
Type of Use 2020
(Actual)2025 2030 2035 2040 2045
38
improved water will be better for salt-sensitive plants and will, in the short-term, enable
Mountain View to connect around 60 new customers to the distribution system;
2. About half the treated wastewater produced by the RWQCP will be transferred to Valley
Water for use in the county south of Mountain View. Valley Water will pay $1 million
per year to be allocated between all the wastewater agencies that commit treated
effluent to the transfer; and
3. Palo Alto and Mountain View will have a future option to request a new potable or non-
potable water supply from Valley Water if needed. Any new water resource will be
supplied by Valley Water at cost.
The first two elements of the Partnership Agreement are shown in the infographic below.
Figure 3: Palo Alto, Mountain View, Valley Water Partnership Agreement
The City has participated in other various regional recycled water planning initiatives.
• The City is a stakeholder in the ABAG-led effort to secure grant funding for a Bay Area
Integrated Regional Water Management Plan (IRWMP) and for projects identified in
that IRWMP.
• CPAU and the partners of the RWQCP assisted in the funding of a project to build a new
recycled water pipeline from the RWQCP to Mountain View. The project was completed
in summer 2009. This project does not have new connections to end uses in the City,
but the pipeline is sized to accommodate future expansion of recycled water use in the
City.
• The City is a member of the California WateReuse Association, which helps promote and
implement water recycling in California.
39
• The City is a member of the Bay Area Recycled Water Coalition, a group of regional
recycled water project proponents that advocate for and seek funding from the Federal
Bureau of Reclamation under Title 16.
• The City is a member of Bay Area Clean Water Agencies, a group of wastewater
treatment plants that advocate and seek funding from State propositions and State
Revolving Fund loans.
• The City actively participates on the Valley Water Recycled Water Subcommittee. The
Committee is a group of recycled water retailers and wholesalers that meets bimonthly
to discuss issues and challenges surrounding the use and promotion of recycled water.
• The City of Palo Alto is currently a member of the Joint Recycled Water Task Force with
Valley Water which seeks future recycled water expansion projects.
Encouraging and Optimizing Recycled Water Use
Law
10633. The plan shall provide, to the extent available, information on recycled water and its
potential for use as a water source in the service area of the urban water supplier. The preparation
of the plan shall be coordinated with local water, wastewater, groundwater, and planning agencies
that operate within the supplier’s service area, and shall include all of the following:
(f) A description of actions, including financial incentives, which may be taken to encourage the
use of recycled water, and the projected results of these actions in terms of acre-feet of recycled
water used per year.
(g) A plan for optimizing the use of recycled water in the supplier's service area, including actions
to facilitate the installation of dual distribution systems and to promote recirculating uses, to
facilitate the increased use of treated wastewater that meets recycled water standards, and to
overcome obstacles to achieving that increased use.
The City has engaged in a variety of activities to advance water reuse. Regional coordination as
well as state and federal matching funds will be critical to successful implementation.
The City encourages Recycled Water usage in the following ways:
• Participating in the Integrated Regional Water Management Plan process
• Encouraging businesses and City departments to utilize the existing recycled water
capability within the City
• Participating as an active member of the WateReuse Association, including hosting
meetings of the Northern California Chapter of the Association
• Offering recycled water for free to users willing to pick it up at the RWQCP by truck
• Adoption of the Recycled water Mandatory Use Ordinance
• Adoption of the Salinity Reduction Policy
40
In May 2008, the City approved a Mandatory Use Ordinance to require customers to prepare
for recycled water delivery in the future 39. In 2019, the City updated the Green Building
Ordinance 40. The threshold for dual plumbing in new construction was lowered from 100,000 sf
(square feet) to 50,000 sf or 50 or more toilets and urinals (formerly 100 toilets and urinals).
Compliance with the ordinance is administered through the permit process with the Building
Department. CPAU provides plan review services of landscape and irrigation design plans, in
order to ensure compliance with outdoor water efficiency and recycled water requirements.
The Northwest County Recycled Water Strategic Plan identified several non-potable
alternatives. If the Phase 3 recycled water expansion project with an extension up to Foothills
Park is approved by City Council and constructed, the recycled water use in the City would
increase by approximately 1,100 AF per year.
The City Council approved a Salinity Reduction Policy 41 in January 2010 to address the elevated
salinity levels in the recycled water. The policy identified inflow and infiltration as a likely
contributor to the elevated salinity levels, and provided a target salinity level based on
minimum inflow and infiltration into the wastewater collection system. As a result, several
steps were implemented to lower the TDS levels in the recycled water:
• The RWQCP continues to monitor potential saltwater intrusion "hotspots" and
communicate the results to the RWQCP partners;
• The RWQCP tracks salinity data and perform other investigative work to support the
effort;
• CPAU coordinated implementation of the Sanitary Sewer Management Plan to manage
the Palo Alto wastewater collection system and identify inflow and infiltration reduction
actions; and
• The RWQCP developed a plan to coordinate salinity reduction activities with the RWQCP
partners and prepare for expanded recycled water application. This plan 42 was
coordinated with the Valley Water, which has jurisdiction over the groundwater basins
in Santa Clara County.
Customer concerns regarding potential negative effects of recycled water on redwood trees
and other sensitive plants led the City to identify several mitigation measures in the Phase 3 EIR
if the City is unable to meet the goal for a TDS of 650 mg/l by project start-up:
• The City may utilize its existing Recycled Water Ordinance exemption process to exempt
redwood trees and/or other salt sensitive species from the use of recycled water;
• The City may blend recycled water and other lower salinity water prior to application;
and/or
39 City of Palo Alto Municipal Code, Title 16, Chapter 16.12. The Ordinance applies to non-residential customers.
The City has no plans to provide recycled water to residential customers.
40 See PAMC section 16.14: https://codelibrary.amlegal.com/?o=1
41 City Council Resolution 9035: http://www.cityofpaloalto.org/civicax/filebank/documents/21246
42 The Valley Water updated its groundwater management plan in 2012
41
• The City may treat recycled water to reduce TDS prior to application, or shortly
thereafter.
A key component of the Partnership Agreement is Valley Water funding for a salt removal
facility at the RWQCP. The Advanced Water Purification System (AWPS) will improved the
quality of recycled water produced at the RWQCP enabling increased use in Mountain View and
addressing water quality concerns regarding the potential Phase 3 expansion to the Stanford
Research Park and other customers. Design of the project is underway with construction
completion anticipated by 2022.
Desalinated Water
Law
10631 A plan shall be adopted . . . that shall do all of the following:
(g) Describe the opportunities for development of desalinated water, including, but not limited
to, ocean water, brackish water, and groundwater, as a long-term supply.
Development of desalinated water is not feasible at this time. In its Long Term Reliable Water
Supply Strategy, BAWSCA considered a wide range of desalination projects, ranging in size from
1 MGD to 20 MGD, and ranging in type from brackish groundwater to an ocean water open
intake. Two types of projects were included in the final report: 1) a project that produces 15
MGD of water sourced from an open intake in San Francisco Bay; and 2) a project that produces
up to 6.5 MGD from brackish water sourced from either shallow vertical brackish groundwater
wells or horizontal directionally drilled (HDD) wells extracting higher salinity brackish
groundwater from under the Bay. BAWSCA is committed to facilitating desalination
partnerships and pursuing outside funding for related studies.
The City is currently aware of one regional collaborative effort between different water
agencies to evalua12%12%te a large scale Bay Area desalination project, The Bay Area Regional
Desalination Project. The Bay Area Regional Desalination Project is a collaboration between the
East Bay Municipal Utility District, Valley Water, the SFPUC, Contra Costa Water District, and
Zone 7 Water Agency to jointly explore developing the feasibility of a regional desalination
facility that could directly or indirectly benefit 5.4 million San Francisco Bay Area residents and
businesses served by these agencies. The SFPUC is considering the project in combination with
the Los Vaqueros Reservoir expansion project.
42
Energy Intensity
Law
10631.2 (a) …an urban water management plan shall include any of the following information
that the urban water supplier can readily obtain:
(1) An estimate of the amount of energy used to extract or divert water supplies.
(2) An estimate of the amount of energy used to convey water supplies to the water treatment
plants or distribution systems.
(3) An estimate of the amount of energy used to treat water supplies.
(4) An estimate of the amount of energy used to distribute water supplies through its distribution
systems.
(5) An estimate of the amount of energy used for treated water supplies in comparison to the
amount used for nontreated water supplies.
(6) An estimate of the amount of energy used to place water into or withdraw from storage.
(7) Any other energy-related information the urban water supplier deems appropriate.
The RWS is mostly gravity-fed, and therefore, has relatively low energy intensity. More
information is provided in SFPUC’s 2020 UWMP
The City’s local distribution system operates mostly by taking advantage of the gravity-fed RWS
with two exceptions: water pumped to storage and customers in the foothills and the
production of recycled water. An estimated 775,000 kwh per year is required to produce the
City’s 1,000 AFY recycled water supply making the energy intensity 775 kwh/AF. Moving water
to the foothills requires approximately 1,500,000 kwh per year. Spreading the energy use over
Palo Alto’s total potable demand of 12,000 AF yields an energy intensity of 125 kwh/AF.
However, since 2013 the City’s electric supply has been carbon neutral 43, making the
greenhouse gas footprint negligible.
43 Palo Alto Carbon neutral Plan: https://www.cityofpaloalto.org/civicax/filebank/documents/33220
43
Section 4 – Water Demand
Law
10631 A plan shall be adopted in accordance with this chapter that shall do all of the following:
(d) (1) Quantify, to the extent records are available, past and current water use, over the same
five-year increments described in subdivision (a), and projected water use, identifying the uses
among water use sectors including, but not necessarily limited to, all of the following uses:
(A) Single-family residential; (B) Multifamily; (C) Commercial; (D) Industrial; (E)
Institutional and governmental; (F) Landscape; (G) Sales to other agencies; (H) Saline water
intrusion barriers, groundwater recharge, or conjunctive use, or any combination thereof; (I)
Agricultural; and (J) Distribution system water loss.
(2) The water use projections shall be in the same five year increments described in subdivision
(a).
(4)(A) Water use projections, where available, shall display and account for the water savings
estimated to result from adopted codes, standards, ordinances, or transportation and land use
plans identified by the urban water supplier, as applicable to the service area.
(B) To the extent that an urban water supplier reports the information described in
subparagraph (A), an urban water supplier shall do both of the following: (i) Provide citations of
the various codes, standards, ordinances, or transportation and land use plans utilized in making
the projections. (ii) Indicate the extent that the water use projections consider savings from codes,
standards, ordinances, or transportation and land use plans. Water use projections that do not
account for these water savings shall be noted of that fact.
10631.1 (a) The water use projections shall include projected water use for single-family and multi-
family residential housing for lower income households, as identified in the housing element of
any City, County, or City and County in the service area of the supplier.
10608.4 Provide baseline daily per capita water use target, interim urban water use target, and
compliance daily per capita water use, along with the basis for determining those estimates.
Water Usage
Lay Description
Although the City has experienced several drought periods since 1975, the recent drought of
2014 to 2016 has had a particularly profound effect on City and customer attitudes regarding
water. The state-mandated water use reductions in the recent drought resulted in large
numbers of landscape conversion projects as well as a dramatic shift in customer behavior
regarding water use. In addition, new construction in every sector is subject to increasingly
stringent regulations regarding water-using appliances and fixtures.
44
Demand Projections
Incorporating the profound effects of the recent drought and state-imposed mandatory potable
water use reductions presented an additional challenge when developing the water demand
projections for this UWMP. The City used a model developed by BAWSCA to forecast SFPUC
purchases assuming the continuation of the City’s existing Demand Management Measures
(DMMs). The City used the same BAWSCA model to project water savings from future DMMs,
which is discussed in detail in Section 5 of this plan.
The BAWSCA model uses a Demand Side Management Least Cost Planning Decision Support
System (DSS Model) in combination with an Econometric Model to determine demand
projections. The Econometric Model projected short-term demands through 2025 based upon
historical water use patterns through 2019 and the projected future rebound in water demand
associated with forecasts for drought recovery. The DSS model projected long-term demand for
each end-use customer class (through 2045) based upon expected service area growth for both
population and employment. The DSS model considers unemployment rates and projects
demand assuming a normal economy. Age of buildings is also considered with regard to end
uses as a result of plumbing code changes and assumed fixture replacement rates.
Figure 4: below shows the City’s potable water use since 1988 and a projection of water
supplies through 2045. Water consumption in the recent drought reached its lowest level in
more than 25-years. The reduction in water consumption was the result of state mandated
water reductions combined with permanent water conservation measures.
During the drought of 2014 to 2016, the SWRCB required the City to reduce potable water use
by 24% for the period June 2015 through October 2016 compared to usage in 2013. The City
met that reduction target. Because many permanent water use changes including landscape
conversion occurred as a result of rebate programs and public outreach, and because the City
detects a shift in the community’s attitude regarding water use, the City forecasts water
consumption to remain relatively stable in the future, with slight increases due to a post-
drought rebound and continued increases in economic development and population. By 2025,
the City projects that the overall trend of decreasing per capita water use will resume.
45
Figure 4: Water Supply Purchases – Actual and Forecast
Water Sales
Total water sales decreased by 11%, from 11,375 AF/Y to 10,177 AF/Y between FY 2010 and FY
2015 during the drought. Water sales rebounded from FY 2015 to FY 2020 by 5% up to 10,722
AF/Y. Table 10 shows historical and projected sales by customer type before and after
incorporating the impact of planned DMMs discussed in Section 5 – Demand Management
Measures. Planned DMMs are included as an estimate, however, actual conservation programs
are subject to approval by Palo Alto’s City Council. Table 11 shows the number of accounts in
each category, and Table 12 shows the sales per account for each customer type. The City does
not have sales to other agencies, agricultural use, or saline water intrusion barriers,
groundwater recharge, or conjunctive use, or any combination thereof.
46
Table 10: Historical and Projected Water Sales – by Customer Type (Fiscal Years)
Table 11: Historical and Projected Water Accounts – by Customer Type (Fiscal Years)
Table 12: Historical and Projected Water Sales per Account (AF) (Fiscal Years)
Use per account rebounded from FY 2015 to FY 2020 in most customer categories as California
emerged from a drought. Overall water use per account increased by 5%. During this period,
water use per account increased by 9% for single family residences, 5% for multifamily, 9% for
industrial, 29% for public facilities, and 26% for City facilities. Water use per account decreased
6% for commercial, and 6% for landscape irrigation customers.
Share of Total Consumption by Customer Type
In FY 2020 single-family and multi-family water sales were responsible for 63% of total water
consumption in the City. The business sectors including commercial and industrial customers
consume 18%, while irrigation customers consumed 12%. Public and City facilities consume the
AF/Y 2015 2020 2025 2030 2035 2040 2045
Single Family 4,554 4,967 4,796 4,905 5,019 5,163 5,308
Multifamily 1,530 1,797 1,837 1,852 1,876 1,913 1,954
Commercial 1,911 1,628 1,763 1,753 1,750 1,753 1,760
Industrial 397 295 313 321 328 336 343
Institutional 357 435 417 435 453 472 490
Other 3 3 2 2 2 2 2
Landscape 1,163 1,278 1,252 1,282 1,313 1,343 1,374
Government 263 319 300 313 326 340 353
Total Water Sales 10,177 10,722 10,681 10,864 11,067 11,322 11,585
Future DMM 198 293 356 375 348
Net Water Sales 10,177 10,722 10,483 10,571 10,711 10,948 11,237
2015 2020 2025 2030 2035 2040 2045
Single Family 15,029 15,026 16,049 16,754 17,430 18,161 18,869
Multifamily 1,923 2,162 2,329 2,431 2,529 2,635 2,738
Commercial 1,494 1,352 1,363 1,396 1,429 1,462 1,495
Industrial 91 62 70 72 73 75 77
Institutional 50 47 51 54 56 58 61
Other 669 707 729 761 792 825 857
Landscape 371 433 426 437 447 458 468
Government 236 228 239 249 259 270 280
Total Water Acounts 19,863 20,016 21,256 22,153 23,015 23,944 24,845
2015 2020 2025 2030 2035 2040 2045
Single Family 0.303 0.331 0.293 0.287 0.280 0.276 0.273
Multifamily 0.795 0.831 0.784 0.753 0.729 0.713 0.700
Commercial 1.279 1.204 1.288 1.242 1.204 1.176 1.151
Industrial 4.348 4.749 4.464 4.437 4.412 4.403 4.393
Institutional 7.148 9.214 8.095 8.087 8.081 8.081 8.081
Other 0.004 0.004 0.003 0.003 0.003 0.003 0.003
Landscape 3.132 2.956 2.779 2.655 2.652 2.663 2.773
Government 1.115 1.401 1.258 1.257 1.256 1.256 1.256
Total Use per Account 0.512 0.536 0.494 0.478 0.467 0.458 0.453
47
remaining 7%. The relative share of water consumed by residential customers has increased
since FY 2015 by 3% while the share of water consumed by business sectors (other than
irrigation) has increased decreased by 5% since FY 2015. Figure 5 and Figure 6 below show the
breakdown of consumption by customer type for FY 2015 and FY 2020.
Figure 5: FY 2015 Water Sales by Customer Class
Figure 6: FY 2020 Water Sales by Customer Class
Sales to Other Agencies
The City has not, and does not plan to, sell water supplies to other agencies.
Additional Water Uses ‐ Recycled Water Use
Recycled water use is discussed in Section 3, “System Supplies,” under the heading “Water
Recycling.” Past use and future recycled water use projections are presented in Table 13 below.
Although the City is exploring an expansion of its recycled water system, the Council has not
made a commitment to expand the use of recycled water in the City and, therefore, the table
reflects no increase in the use of recycled water in the future. The 2015 UWMP projected
48
future recycled water use to be 850 AF/Y. That projection inadvertently included industrial
process water used at the RWQCP. Recycled water use at the municipal golf course increased
due to changes made to the landscaping which allowed for more high salinity water to be
applied. Actual use in 2020 was 316 AF.
Table 13: Recycled Water Use (AFY)
Non‐Revenue Water/Water Loss
Non-Revenue water, or unaccounted-for water, is the difference between the amount of water
purchased and the amount sold to customers. Non-revenue water typically amounts to about
7% of total purchases. From CY 2005 to 2008, the City’s non-revenue water volumes
significantly increased, with a peak in CY 2006 of 12.45%. In response, the City initiated a
comprehensive leak detection, meter locating and meter calibration program. As of 2009, the
non-revenue water volumes returned to expected levels. Appendix C contains the water loss
audit report for the most recent year to date, 2019. Real losses in that year, as per the audit,
were 123 AF.
Table 14 presents the historical and projected non-revenue water volumes for the City’s water
system.
Table 14: Non‐Revenue Water (AFY)
Total Water Use
Table 15 shows total water use in the City.
Table 15: Total Water Use (AFY)
Treatment 2015
(Actual)
Agriculture 0 0 0 0 0 0 0
Landscape (no golf courses)63 42 42 42 42 42 42
Golf Course 166 250 250 250 250 250 250
Industrial 0 0 0 0 0 0 0
Groundwater Recharge 0 0 0 0 0 0 0
Palo Alto Duck Pond 29 25 25 25 25 25 25
Total 258 316 316 316 316 316 316
Type of Use 2020
(Actual)2025 20352030 2040 2045
Tertiary
treatment plus
additional
disinfection (Title
22 unrestricted
use standard)
AFY 2020 2025 2030 2035 2040 2045
Non-Revenue Water 199 790 798 808 826 848
2020 2025 2030 2035 2040 2045
Retail Sales 10,722 10,483 10,571 10,711 10,948 11,237
Non-Revenue Water 199 790 798 808 826 848
Recycled Water 316 316 316 316 316 316
Total 11,237 11,589 11,685 11,836 12,090 12,401
49
Projected Low to Moderate Income Water Use
Palo Alto was one of the first jurisdictions in California to establish an official low to moderate
income housing requirement in 1974. The Below Market Rate (BMR)44 program now requires
developers of projects with five or more residential units to comply with the City’s BMR
requirements. The BMR program objective is to obtain actual housing units within each
development rather than off-site units or in-lieu payments. At least 15% of the housing units
developed in a project involving fewer than five acres of land must be provided as BMR units.
Projects involving the development of five or more acres must provide at least 20% of all units
developed as BMR units. (Projects that cause the loss of existing rental housing may need to
provide a 25 percent BMR component). The BMR units must be comparable to the market rate
units in the development.
Due to the BMR requirements and the cost of housing in Palo Alto, the City has few single-
family BMR units and does not anticipate this will change in the future. Approximately 2,192
units in the City meet lower income levels as defined in Section 50079.5 of the California Health
and Safety code 45. Of these, 599 rental and ownership units, or 28% of the total housing units
were produced through the BMR program. The remaining 1,593 units, or 72% of total housing
units, are subsidized housing.46
For purposes of the current lower income projections, the 2020 UWMP assumes:
• 2,192 units out of the total housing stock in 2020 are considered affordable housing as
determined by the classification of very low to moderate incomes.
• Affordable housing units in Palo Alto are categorized as multi-family.
• An average of 2.03 47 individuals per multi-family unit. This is approximately 5,000
individuals or 7% of the total population in 2020.
• Multi-family usage in Palo Alto is projected to average approximately 49 GPCD in 2025
declining to 44 GPCD in 2045 (from the DSS model).
• An additional of 46 units will be added for each 5-year increment in the planning
horizon.48
Table 16: Projected Low Income Water Demands (AF)
44 City of Palo Alto Comprehensive Plan, Chapter 4 – Housing Element
45 The difference between the total BMR units and the units that meet the requirements in the UWMP Act is due to
the inclusion of additional units that meet 81% to 120% of the Average Median Income in Santa Clara County. The
City provides these additional units in recognition of high cost of housing in Palo Alto.
46 Current figures provided by the City of Palo Alto Planning Department.
47 U.S. Census Bureau, American Community Survey (ACS) 2018 5yr Data , assumes an average of 2.03 persons per
multi-family dwelling unit.
48 15% BMR requirement applied to Council housing goal of 300 units
2020 2025 2030 2035 2040 2045
Single-family Residential 0 0 0 0 0 0
Multi-family Residential 235 267 281 296 312 329
Total 235 267 281 296 312 329
50
The City anticipates the current BMR program requirements will remain in effect in its current
form for the foreseeable future. Future housing and population projections inherently assume
that increases in housing stock will include growth in lower income households through the
BMR program. Based on future projected demand forecasts shown in Table 10, the City expects
to have ample water supplies to meet all customers’ demands during a normal year. During a
drought, the City will follow the steps outlined in Section 8 (Water Shortage Contingency Plan).
The Water Shortage Contingency Plan addresses the City’s response depending on the severity
of the drought. The City will implement measures to maximize potential savings while at the
same time minimizing the impact to the wellbeing of the citizens and businesses in Palo Alto.
As part of this process, the City Council will have an opportunity to balance the needs of
different customer classes with the need to achieve meaningful reductions 49.
Water Conservation Bill of 2009
The Water Conservation Bill of 2009 (SBx7-7) was enacted in November 2009. It requires water
suppliers to reduce the statewide average per capita daily water consumption by 20% by
December 31, 2020. To monitor the progress towards achieving the 20% by 2020 target, the bill
also required urban retail water providers to reduce per capita water consumption 10% by
2015. Water agencies that are not in compliance with the provisions of the bill could be
ineligible for State grants and/or a low cost financing program.
Water suppliers have some flexibility in setting and revising water use targets leading up to the
2020 compliance period, including:
• A water supplier may set its water use target and comply individually, or as part of a
regional50 alliance. The City is in discussions with BAWSCA and Valley Water regarding a
potential future alliance with other water agencies.
• A water supplier may revise its water use target in its 2015 or 2020 urban water
management plan or in an amended plan.
• A water supplier may change the method it uses to set its water use target and report
through an amendment to the 2010 plan or in its 2015 urban water management plan.
Urban water suppliers are not permitted to change target methods after they have
submitted their 2015 urban water management plan.
SBx7-7 provided four potential compliance methods that are summarized below:
1. 80% of the urban water user’s baseline gallons per capita per day (GPCD) water use;
49 Water Utilities typically do not possess income information for their customers and are limited in their ability to
offer differential rate treatment for low income customers due to Proposition 218 restrictions. During a drought, it
is more common for water utilities to differentiate between customers in a Class based on water usage patterns
and relative efficiency. For example, accounts with extremely low water use could be exempted from penalty rate
treatment.
50 SBx7-7 allows entities to comply individually or as a group. The intent of this provision is to ensure there is
equity among small agencies and large water agencies or districts that serve large areas that may span
different socioeconomic and evapotranspiration zones.
51
2. The per capita daily water use that is estimated using several performance measures,
subdivided between different customer classes;
3. Ninety-five percent of the applicable state hydrologic region target, as set forth in the
state’s draft 20x2020 Water Conservation Plan (dated April 30, 2009); or
4. A method that was identified and developed by the department, through a public
process, and released on December 31, 2010. The fourth method uses a combination
of metered sales data and achieved water use reductions across the different customer
classes.
The City Council, by Resolution 9174, adopted a compliance methodology based on the first
option, or 80% of an urban water user’s baseline GPCD. Under this methodology, the City is
required to prepare the following calculations for compliance purposes:
• Baseline daily per capita water use — The City must determine for baseline purposes
how much water is used within an urban water supplier’s distribution system area on a
per capita basis. It is determined using water use and population estimates from a
defined range of years. For the City, the range selected is from fiscal year 1995 to 2004
(Table 17).
• Urban water use target — The value is equal to 80% of the baseline daily per capita
water use value.
• Interim urban water use target — The planned daily per capita water use in 2015 is
halfway between the baseline daily per capita water use and the urban water use
target.
• Compliance daily per capita water use – The gross water use during the final year of
the reporting period, reported in gallons per capita per day. This value will be adjusted
during the 2015 and 2020 compliance period based on actual usage data.
Table 17 illustrates the methodology to calculate the 10-year average baseline per capita51
water use.
Table 17: Baseline Daily Per Capita Water Use for 10‐year period (1995 through 2004)
51 US Census
Fiscal Year Distribution System Population Daily System Gross Water Use (MG)
1995 56,647 203.8
1996 56,885 220.8
1997 57,420 203.8
1998 57,868 203.8
1999 58,136 198.2
2000 58,467 203.7
2001 59,334 199.6
2002 60,028 209.1
2003 59,930 202.5
2004 59,894 251.1
225.3Baseline Daily Per Capita Water Use
52
Based on future water use and population growth projections, Table 18 summarizes Palo Alto’s
2010 UWMP SBx7-7 target and compliance goals.
Table 18: 2015 UWMP SBx7‐7 Performance Metrics (gallons per capita per day)
The City met the 2020 SBx7-7 target and the 2015 target. The City did not adjust the
compliance original target.
Measures, Programs and Policies that Achieved SBx7‐7 Water Targets
The City is committed to promoting all cost-effective conservation programs that meet both the
City’s water reduction goals and community interest. Palo Alto shifts emphasis between
different conservation programs depending on various factors, including community
acceptance.
Economic Impacts of SBx7‐7 Compliance
There were no incremental economic impacts associated with SBx7-7 compliance.
Implementation of conservation measures was not driven by SBx7-7. Palo Alto deploys all
measures that are cost effective compared to the incremental cost of purchasing additional
water supplies from the SFPUC system 52.
52 DMMs discussed in Section 5
2015 2020
Baseline GPCD 225.3 225.3
Target GPCD 202.8 180.3
Actual GPCD 142.0 141.7
53
Section 5 – Demand Management Measures
Law
10631 (f) Provide a description of the supplier’s water demand management measures. This
description shall include all of the following:
(1) (A) For an urban retail water supplier, as defined in Section 10608.12, a narrative
description that addresses the nature and extent of each water demand management measure
implemented over the past five years. The narrative shall describe the water demand management
measures that the supplier plans to implement to achieve its water use targets pursuant to Section
10608.20.
(B) The narrative pursuant to this paragraph shall include descriptions of the following water
demand management measures: (i) Water waste prevention ordinances. (ii) Metering. (iii)
Conservation pricing. (iv) Public education and outreach. (v) Programs to assess and manage
distribution system real loss. (vi) Water conservation program coordination and staffing support.
(vii) Other demand management measures that have a significant impact on water use as
measured in gallons per capita per day, including innovative measures, if implemented.
10620 (f) An urban water supplier shall describe in the plan water management tools and options
used by that entity that will maximize resources and minimize the need to import water from other
regions.
The City is committed to support conservation and efficient use of its water supply. It is the goal
of the City to continue to look for opportunities, innovative technologies, and cost-effective
programs that best utilize the City’s water conservation budget. The City works with BAWSCA
and Valley Water to implement Best Management Practices water conservation programs.
The California Water Code Section 10631 (e) requires that an urban retail water supplier
provide descriptions that addresses the nature and extent of the following DMMs that have
been implemented over the past five years and/or will be implemented to achieve its water use
target pursuant to SBx7-7:
A. Water waste prevention ordinance;
B. Metering;
C. Conservation pricing;
D. Public education and outreach;
E. Programs to asses and manage distribution system real loss;
F. Water conservation program coordination and staff support; and
G. Other demand management measures that have a significant impact on water use as
measured in gallons per capita per day, including innovative measures, if implemented.
In addition, the DMMs described below are water management tools and options used by the
City that maximize resources and minimize the need to import water from other regions.
54
Water Waste Prevention Ordinance
The City has enforced water waste prevention as part of the City’s Municipal Code since 1989
(Palo Alto Municipal Code Chapter 12.32). Enforcement includes written warning notices to
violators and may result in fines and installation of a flow restrictor on the service connection of
the customer or purchaser of water whose service connection was used in the violations
observed or established, and billing the costs of such installation to said customer or purchaser.
Green Building Ordinance and Model Efficient Landscape Ordinance
In 2015, Palo Alto City Council approved an updated Green Building Ordinance (Palo Alto
Municipal Code Chapter 16.14) that incorporates the state’s 2013 Green Building Standards
Code (CALGreen), which sets permit requirements for water efficiency design, including
irrigation systems, in new development. In addition to the CALGreen standards, the City
requires the installation of a “laundry to landscape ready” irrigation system for all residential
new construction projects. Also, the City’s Green Building Ordinance has a lower square footage
trigger for irrigation efficiency than the state’s Model Water Efficient Landscape Ordinance
(MWELO). The 2019 Green Building Ordinance 53 update lowered the threshold for dual
plumbing in new commercial construction to 50,000 sf and 50 toilets or urinals.
For non-residential projects, MWELO requires compliance for landscapes of any size associated
with new construction and landscapes of 1,000 square feet for renovation projects. Under the
City’s current Green Building Ordinance, compliance with MWELO is required for landscapes of
any size on all non-residential construction projects, as well as for landscaped areas of 1,000
square feet or more for residential projects. Palo Alto adopted the State Water Efficient
Landscape Ordinance per Governor Brown’s Drought Executive Order EO-29-15. The new
ordinance went into effect February 1, 2016.
Metering
The City has approximately 20,000 water service connections in its service territory. In 2020,
irrigation meters accounted for 2% of the total installed meters, whereas water consumption
from irrigation meters accounted for 10% of the City’s total metered water consumption. Non-
revenue water (NRW) usage currently accounts for less than 7% of the City’s water
consumption (by comparison, the 2020 national average of NRW was 16%.)
Palo Alto is planning on installing advanced metering infrastructure (AMI) for electric, water
and gas meters. When fully implemented in 2024-25, the system will be capable of detecting
water leaks at customer premises and alerting them. City plans to leverage this technology to
reduce water leaks at customer premises and help lower bills.
53 See Green Building Ordinance:
https://www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=44495.2&BlobID=74776
55
Since 2012, the City has been replacing aging water meters with digital water meters that
register water usage down to increments of 0.01 CCF (or hundred cubic feet). Traditional water
meters can only register water usage in increments of 1 CCF. The smaller incremental water
usage readings help to facilitate water leak detection.
Conservation Pricing
Since 1976, the City has implemented conservation-based pricing for water usage, within an
overall cost-based rate structure. For residential customers, water usage is billed as a two-
tiered volumetric charge that increases as monthly water consumption exceeds a threshold
level. For non-residential customers, water usage is billed on a uniform volumetric charge. All
customers are also billed a monthly service charge that varies depending on the meter size.
The City conducted a water cost of service and rate study 54 in 2019 with the assistance of an
independent consultant, to ensure continued compliance with the California Constitution’s cost
of service requirements for water rates. As a result, the water rate structure was evaluated and
updated. On an annual basis, City staff reviews and updates the City’s water rates for both
residential and nonresidential water customers.
Public Education and Outreach
Since 2006, the City has partnered with BAWSCA to offer free workshops on water efficient
landscaping, irrigation and water conservation. Workshop topics include Creating a Water-
Efficient Sustainable Garden, Laundry to Landscape Graywater Systems, Irrigation Basics for
Homeowners, Water Conservation 101, Rainwater Harvesting, etc. In addition to public
workshops, City of Palo Alto Utilities (CPAU) staff attends community, corporate and school
events to promote water conservation programs and practices, in addition to energy efficiency,
waste reduction and other sustainability practices. During shelter-in-place, workshops
continued to be offered via live and recorded webinars 55.
The City carries out various seasonal and general water conservation campaigns via the use of
television, online, social media and print advertisements. Palo Alto also regularly updates the
City’s website on water conservation programs and public workshops. The City utilizes utility
bill inserts, brochures and email newsletters to customers as part of its outreach efforts.
In the fall of 2014, due to the drought, the City implemented a web and mobile application
known as PaloAlto311 to allow residents and businesses to report incidents of leaks or other
water waste issues.
54 See consultant memo:
https://www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=48180.98&BlobID=71405
55 https://bawsca.org/conserve/programs/classes
56
In response to prolonged drought conditions, on January 31, 2014 the SFPUC asked its Retail
and Wholesale Customers to voluntarily reduce system-wide water consumption by 10 percent.
That summer, BAWSCA, in partnership with the SFPUC, launched a regional drought education
campaign to heighten awareness and encourage water conservation. The regional campaign
drew upon the SFPUC’s “Water Conservation is Smart and Sexy” citywide campaign. The
regional campaign appeared in the form of billboards, BART station ads, movie theater ads, and
online video advertisements.
Following Governor Brown’s Drought Executive Order on April 1, 2015 and conservation
regulations mandating a statewide 25 percent reduction in potable urban water use, the SFPUC
continued its call for a system-wide 10 percent reduction in water use. The SFPUC and BAWSCA
partnered again to launch a new drought campaign for the summer of 2015 to remind
customers to keep up their water conservation efforts, focusing in particular on outdoor water
savings. Regional messaging was included in the form of billboards, BART station ads, television
ads, newspaper ads, and a video campaign.
During shelter-in-place, The City continued to engage in public outreach including a family-
friendly e-newsletter, one issue of which focused on water conservation56.
Programs to Assess and Manage Distribution Systems Real Loss
For over two decades, the City has pursued an aggressive Water Main Replacement Capital
Improvement Program. This program identifies seismically vulnerable and structurally deficient
water mains and appurtenances that are undersized, corroded, and/or subject to breaks and
leaks, and replaces them with jointless high-density polyethylene (HDPE) NSF 61 piping
material. Trenchless construction methods are utilized, where it is cost effective. Through this
program, approximately 10,000 linear feet of water mains are replaced every other year, which
has significantly reduced water leaks throughout the system. The City maintains a 24-hour
response program to fix water leaks.
In addition, the City also maintains a Water Meter Replacement Program that replaces 500 to
1,000 meters per year in accordance with American Water Works Association (AWWA)
standards. In the last 5-years meter replacement has been at a rate of about 200 meters per
year in anticipation of the AMI program that will replace about 11,000 meters by 2024. In 2012
through 2014, a “Large Water Meter Testing, Calibration, Repair & Replacement” Program was
undertaken that involved a total of 257 large water meters. Of these meters, 136 meters have
been tested, repaired, removed, or replaced, thereby improving the accuracy and reliability of
these meters. Meters are tested on a 10-year cycle in accordance with industry-standard best
management practices. Depending on the test results the 20-year meter replacement cycle
may be adjusted to address meters outside the AWWA specifications.
56 See Sustainability Newsletter for kids: https://content.govdelivery.com/accounts/CAPALO/bulletins/2a6f131
57
Coupled with the aforementioned AMI project, these capital improvement programs further
enhance the City’s ability to track volume of water entering and leaving the distribution system,
reducing NRW and aligning the Utility's meter testing and replacement cycles.
Water Conservation Program Coordination and Staffing Support
To achieve the water conservation and efficiency objectives of state and local mandates, Palo
Alto partners with agencies, such as Valley Water and BAWSCA, to offer many conservation
programs and services to Palo Alto residential and commercial water customers. City Council
has adopted several policies that support increased goals for energy and water efficiency
efforts as well as sustainability goals for the City.
Water Conservation Programs
For over a decade Palo Alto has partnered with Valley Water to administer water efficiency
programs to meet the City’s water reduction goals. This partnership between Valley Water and
the City is currently formalized through a Memorandum of Understanding 57 (MOU), under
which Valley Water and the City co-fund various programs and partner to promote residential
and commercial sanitary fixtures, free conservation devices, indoor and outdoor water
efficiency surveys, irrigation hardware upgrades, and residential educational workshops. Over
time, the water efficiency programs provided under the MOU have evolved or expanded
concurrent with advancements in water-saving technologies and best practices for water
efficient program delivery.
The most innovative technologies and cost-effective programs are implemented to best utilize
the annual water conservation operating budget. These programs include free indoor and
outdoor water audits, as well as rebates for upgrading a wide range of water-using fixtures to
high efficiency models, including laundry to landscape graywater systems, high water-using
landscapes, irrigation hardware, commercial food service and other process equipment. Toilets,
urinals and clothes washer rebates are not currently available but may be again in the future.
Water conservation resources available to Palo Alto customers can be found on the City’s
website58 and Valley Water’s website 59.
Water Wise Survey Program
In partnership with Valley Water, the City offers the Water Wise Survey Program. This two-part
program provides help to customers on how to use less water for their landscape and home.
Do‐it‐Yourself Water Wise Indoor Survey Kits enable customers to independently check their
homes for leaks and efficiency improvement opportunities. Kits include a step-by-step guide to
57 See Staff Report #11295 https://www.cityofpaloalto.org/civicax/filebank/documents/77209
58 See website:
https://www.cityofpaloalto.org/gov/depts/utl/residents/save_energy_n_water/resources/efficiency_tips/water_s
aving_tips.asp
59 See Valley Water’s website: https://www.valleywater.org/water-conservation-programs
58
evaluate water use (in Chinese, English, Spanish, and Vietnamese), a flow rate bag for testing
shower and sink flow rates, and dye tablets for testing toilets for leaks. Digital versions of the
step-by-step guide in multiple languages are also available. Customers who complete the
survey can request free water conservation items for their homes, such as low flow faucet
aerators and showerheads and toilet flappers.
During the Water Wise Outdoor Survey customers receive a free, comprehensive, consultation
from a trained irrigation professional. The consultation includes an irrigation system evaluation
to flag issues onsite, identify rebate programs a customer could qualify for, and create a custom
report detailing the survey findings. The service is offered to single family and small multi-
family sites (under 1/2 acre of landscape area) in Palo Alto with a working irrigation system.
Landscape Rebate Program
The Landscape Rebate Program (LRP) provides rebates for Palo Alto residents and businesses to
convert approved high water-using landscapes (i.e. irrigated turf or functional swimming pools)
with a qualifying low water-using landscape as well as to retrofit existing irrigation equipment
with approved high efficiency irrigation equipment (including rain sensors, high efficiency
nozzles, dedicated landscape meters, and weather-based irrigation controllers), and rainwater
capture incentives such as rain gardens, rain barrels, and cisterns. To participate in the LRP, a
Palo Alto customer must complete a pre-inspection and submit an application for approval
before beginning any work on their project.
As part of the LRP, the City partners with Valley Water to provide Rainwater Capture Rebates
for customers who wish to install a qualifying rain barrel or cisterns to collect rainwater from
existing downspouts or installing a rain garden to collect roof water runoff.
Home Water Report Program
In late 2013, the City began delivering quarterly Home Water Reports to single family
households in Palo Alto. Approximately 13,000 residential customers received the reports. The
Home Water Report compares a household’s water usage to neighbors with similar lot sizes,
landscape area, and family demographics. The reports rank a household for how water efficient
it is compared to homes with similar demographics, in an attempt to encourage more water
efficient behaviors and participation in conservation programs. Annual water savings from this
program are estimated at approximately 1.9% for households receiving the reports. The Home
Water Report program ended in 2015. However, Palo Alto plans to re-launch a similar program
in 2021.
Water Efficient Technology Rebate Program
Through Valley Water, the City offers the Water Efficient Technology (WET) Rebate Program.
Commercial, industrial, and institutional customers such as schools and hospitals may receive a
rebate to replace or update equipment with WET that results in measurable water reduction.
59
Submeter Rebate Program
Through Valley Water, the City offers the Submeter Rebate Program that can help mobile home
parks, apartments and condominium complexes in Palo Alto to convert from a master water
meter to individual water submeters.
Water Conservation Coordinator
The City has maintained a full-time Water Conservation Coordinator position for more than 20
years and expects to maintain the position indefinitely. Duties of the Water Conservation
Coordinator includes water conservation program planning, implementation, management,
reporting, and representing Palo Alto at various water conservation committees and meetings.
The current Water Conservation Coordinator is Kevin Carley (Kevin.Carley@CityofPaloAlto.org)
Water Waste Coordinator
The City created a Water Waste Coordinator position in 2014. The Water Waste Coordinator
performs a wide range of functions associated with the City’s drought response program,
including investigating incidents of water waste, enforcing the City’s water use restrictions, and
responding to customer inquiries about drought regulations and water conservation programs.
The current coordinator is Shelby Sinkler, Program Assistance.
Large Landscape Survey and Water Budget Program
Through Valley Water, the City offers a program that provides landscape irrigation surveys,
water budgets and customized water usage reports for commercial, industrial, institutional, and
multi-family complex customers with over 1/2 acre of landscape area within Palo Alto. These
customers may be eligible for a free landscape field survey. Professional irrigation auditors
perform free site evaluations to provide recommendations for improving system efficiency. The
water budget for each landscape site is calculated based on the area of irrigated landscape,
type of plants, irrigation system and real-time weather monitoring. Monthly reports
documenting a site’s irrigation performance are distributed to site managers, landscapers,
homeowners association board members and other relevant parties, as approved by utility
account holders. Through a web portal, customers can access site-specific recommendations,
view trends in water use, verify water budget assumptions and request a free landscape field
survey from an irrigation expert. This program has been in place since 2012 and to date, there
are 132 large landscape sites covered under this program.
BAWSCA Conservation Programs
BAWSCA manages a Regional Water Conservation Program comprised of several programs and
initiatives that support and augment member agencies’ and customers’ efforts to use water
more efficiently. These efforts extend limited water supplies that are available to meet both
current and future water needs; increase drought reliability of the existing water system; and
save money for both the member agencies and their customers.
The implementation of the Regional Water Conservation Program builds upon both the Water
60
Conservation Implementation Plan (WCIP, completed in September 2009) and the Regional
Demand and Conservation Projections Project (Demand Study, completed in June of 2020).
These efforts include both Core Programs (implemented regionally throughout the BAWSCA
service area) and Subscription Programs (funded by individual member agencies that elect to
participate and implement them within their respective service areas).
BAWSCA’s Core Conservation Programs include organizing classes open to the public on topics
such as water efficient landscape education and water-wise gardening, assistance related to
automated metering infrastructure, and other associated programs that work to promote smart
water use and practices. BAWSCA’s Subscription Programs include numerous rebate programs,
educational programs that can be offered to area schools, technical assistance to member
agencies in evaluating water loss, and programs to train and certify contractors employed to
install water efficient landscape. In total, BAWSCA offers 22 programs to its member agencies
and that number continues to grow over time.
Each fiscal year, BAWSCA prepares an Annual Water Conservation Report that documents how
all of BAWSCA’s 26 member agencies have benefitted from the Core Conservation Programs.
Additionally, the report highlights how all 26 member agencies participate in one or more of
the Subscription Programs offered by BAWSCA, such as rebates, water loss management and
large landscape audits. The Demand Study indicates that through a combination of active and
passive conservation, 37.3 MGD will be conserved by BAWSCA’s member agencies by 2045.
61
Section 6 – Water Supply Reliability
Law
10631 A plan shall be adopted in accordance with this chapter that shall do all of the following:
(b) Identify and quantify, to the extent practicable, the existing and planned sources of water
available to the supplier over the same five-year increments, including:
(1) A detailed discussion of anticipated supply availability under a normal water year, single dry
year, and droughts lasting at least five years, as well as more frequent and severe periods of
drought, as described in the drought risk assessment. For each source of water supply, consider
any information pertinent to the reliability analysis conducted pursuant to Section 10635,
including changes in supply due to climate change.
(f) Include a description of all water supply projects and water supply programs that may be
undertaken by the urban water supplier to meet the total projected water use, as established
pursuant to subdivision (a) of Section 10635. The urban water supplier shall include a detailed
description of expected future projects and programs that the urban water supplier may
implement to increase the amount of the water supply available to the urban water supplier in
normal and single-dry water years and for a period of drought lasting five consecutive water years.
The description shall identify specific projects and include a description of the increase in water
supply that is expected to be available from each project. The description shall include an estimate
with regard to the implementation timeline for each project or program.
(h) An urban water supplier that relies upon a wholesale agency for a source of water shall provide
the wholesale agency with water use projections from that agency for that source of water in five-
year increments to 20 years or as far as data is available. The wholesale agency shall provide
information to the urban water supplier for inclusion in the urban water supplier’s plan that
identifies and quantifies, to the extent practicable, the existing and planned sources of water as
required by subdivision (b), available from the wholesale agency to the urban water supplier over
the same five-year increments, and during various water-year types in accordance with subdivision
(f). An urban water supplier may rely upon water supply information provided by the wholesale
agency in fulfilling the plan informational requirements of subdivisions (b) and (f).
Water Supply Reliability
The City’s potable water supply is dependent upon the reliability of SFPUC’s RWS. The SFPUC
defines reliability by the amount and frequency of water delivery reductions (deficiencies)
required to balance customer demands with available supplies in droughts. This section
discusses these potential system-wide deficiencies.
Reliability of the Regional Water System
In 2008, the SFPUC adopted Level of Service (LOS) Goals and Objectives in conjunction with the
adoption of the Water System Improvement Project (WSIP). The SFPUC updated the LOS Goals
and Objectives in February 2020.
62
The SFPUC’s LOS Goals and Objectives related to water supply are:
Program Goal System Performance Objective
Water Supply – meet
customer water
needs in non-
drought and drought
periods
• Meet all state and federal regulations to support the proper operation of the water system and related power facilities.
• Meet average annual water demand of 265 MGD from the SFPUC watersheds for Retail and Wholesale Customers during non–drought years for system demands consistent with the 2009 Water Supply Agreement.
• Meet dry-year delivery needs while limiting rationing to a maximum 20 percent system-wide reduction in water service during extended droughts.
• Diversify water supply options during non-drought and drought periods.
• Improve use of new water sources and drought management, including groundwater, recycled water, conservation, and transfers.
.
Factors Impacting Supply Reliability
Adoption of the 2018 Bay-Delta Plan Amendment
In December 2018, the SWRCB adopted amendments to the Water Quality Control Plan for the
San Francisco Bay/Sacramento-San Joaquin Delta Estuary (Bay-Delta Plan Amendment) to
establish water quality objectives to maintain the health of the Bay-Delta ecosystem. The
SWRCB is required by law to regularly review this plan. The adopted Bay-Delta Plan
Amendment was developed with the stated goal of increasing salmonid populations in three
San Joaquin River tributaries (the Stanislaus, Merced, and Tuolumne Rivers) and the Bay-Delta.
The Bay-Delta Plan Amendment requires the release of 30-50% of the “unimpaired flow”60 on
the three tributaries from February through June in every year type. In SFPUC modeling of the
new flow standard, it is assumed that the required release is 40% of unimpaired flow.
If the Bay-Delta Plan Amendment is implemented, the SFPUC will be able to meet the projected
water demands presented in this UWMP in normal years but would experience supply
shortages in single dry years or multiple dry years. Implementation of the Bay-Delta Plan
Amendment will require rationing in all single dry years and multiple dry years. The SFPUC has
60 "Unimpaired flow represents the natural water production of a river basin, unaltered by upstream diversions,
storage, or by export or import of water to or from other watersheds." (Water Quality Control Plan for the San
Francisco Bay/Sacramento-San Joaquin Delta Estuary (Dec. 12, 2018) p.17, fn. 14, available at
https://www.waterboards.ca.gov/plans_policies/docs/2018wqcp.pdf.)
63
initiated an Alternative Water Supply Planning Program to ensure that San Francisco can meet
its Retail and Wholesale Customer water needs, address projected dry years shortages, and
limit rationing to a maximum 20 percent system-wide in accordance with adopted SFPUC
policies. This program is in early planning stages and is intended to meet future water supply
challenges and vulnerabilities such as environmental flow needs and other regulatory changes;
earthquakes, disasters, and emergencies; increases in population and employment; and climate
change. As the region faces future challenges – both known and unknown – the SFPUC is
considering this suite of diverse non-traditional supplies and leveraging regional partnerships to
meet Retail and Wholesale Customer needs through 2045.
The SWRCB has stated that it intends to implement the Bay-Delta Plan Amendment on the
Tuolumne River by the year 2022, assuming all required approvals are obtained by that time.
But implementation of the Plan Amendment is uncertain for multiple reasons.
First, since adoption of the Bay-Delta Plan Amendment, over a dozen lawsuits have been filed in
both state and federal courts, challenging the SWRCB’s adoption of the Bay-Delta Plan
Amendment, including a legal challenge filed by the federal government, at the request of the
U.S. Department of Interior, Bureau of Reclamation. This litigation is in the early stages and
there have been no dispositive court rulings as of this date.
Second, the Bay-Delta Plan Amendment is not self-implementing and does not automatically
allocate responsibility for meeting its new flow requirements to the SFPUC or any other water
rights holders. Rather, the Bay-Delta Plan Amendment merely provides a regulatory framework
for flow allocation, which must be accomplished by other regulatory and/or adjudicatory
proceedings, such as a comprehensive water rights adjudication or, in the case of the Tuolumne
River, may be implemented through the water quality certification process set forth in section
401 of the Clean Water Act as part of the Federal Energy Regulatory Commission’s licensing
proceedings for the Don Pedro and La Grange hydroelectric projects. It is currently unclear
when the license amendment process is expected to be completed. This process and the other
regulatory and/or adjudicatory proceedings would likely face legal challenges and have lengthy
timelines, and quite possibly could result in a different assignment of flow responsibility (and
therefore a different water supply impact on the SFPUC).
Third, in recognition of the obstacles to implementation of the Bay-Delta Plan Amendment, the
SWRCB Resolution No. 2018-0059 adopting the Bay-Delta Plan Amendment directed staff to
help complete a “Delta watershed-wide agreement, including potential flow measures for the
Tuolumne River” by March 1, 2019, and to incorporate such agreements as an “alternative” for
a future amendment to the Bay-Delta Plan to be presented to the SWRCB “as early as possible
after December 1, 2019.” In accordance with the SWRCB’s instruction, on March 1, 2019,
SFPUC, in partnership with other key stakeholders, submitted a proposed project description
for the Tuolumne River that could be the basis for a voluntary substitute agreement with the
SWRCB (“March 1st Proposed Voluntary Agreement”). On March 26, 2019, the Commission
adopted Resolution No. 19-0057 to support the SFPUC’s participation in the Voluntary
Agreement negotiation process. To date, those negotiations are ongoing under the California
64
Natural Resources Agency and the leadership of the Newsom administration.61
Water Supply – All Year Types
The SFPUC historically has met demand in its service area in all year types from its watersheds,
which consist of:
• Tuolumne River watershed
• Alameda Creek watershed
• San Mateo County watersheds
In general, 85 percent of the supply comes from the Tuolumne River through Hetch Hetchy
Reservoir and the remaining 15 percent comes from the local watersheds through the San
Antonio, Calaveras, Crystal Springs, Pilarcitos and San Andreas Reservoirs. The adopted WSIP
retains this mix of water supply for all year types.
WSIP Dry Year Water Supply Projects
The WSIP authorized the SFPUC to undertake a number of water supply projects to meet dry-
year demands with no greater than 20 percent system-wide rationing in any one year. Those
projects include the following:
• Calaveras Dam Replacement Project
Calaveras Dam is located near a seismically active fault zone and was determined to be
seismically vulnerable. To address this vulnerability, the SFPUC constructed a new dam
of equal height downstream of the existing dam. Construction on the project occurred
between 2011 and July 2019. The SFPUC began impounding water behind the new dam
in accordance with California Division of Safety of Dams (DSOD) guidance in the winter
of 2018/2019.
• Alameda Creek Recapture Project
As a part of the regulatory requirements for future operations of Calaveras Reservoir,
the SFPUC must implement bypass and instream flow schedules for Alameda Creek. The
Alameda Creek Recapture Project will recapture a portion of the water system yield lost
due to the instream flow releases at Calaveras Reservoir or bypassed around the
Alameda Creek Diversion Dam and return this yield to the Regional Water System (RWS)
through facilities in the Sunol Valley. Water that naturally infiltrates from Alameda
Creek will be recaptured into an existing quarry pond known as SMP (Surface Mining
Permit)-24 Pond F2. The project will be designed to allow the recaptured water to be
pumped to the Sunol Valley Water Treatment Plant or to San Antonio
61 California Natural Resources Agency, “Voluntary Agreements to Improve Habitat and Flow in the Delta and its
Watersheds,” available at https://files.resources.ca.gov/voluntary-agreements/.
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Reservoir. Construction of this project will occur from spring 2021 to fall 2022.
• Lower Crystal Springs Dam Improvements
The Lower Crystal Springs Dam (LCSD) Improvements were substantially completed in
November 2011. The joint San Mateo County/SFPUC Bridge Replacement Project to
replace the bridge across the dam was completed in January 2019. A WSIP follow up
project to modify the LCSD Stilling Basin for fish habitat and upgrade the fish water
release and other valves started in April 2019. While the main improvements to the
dam have been completed, environmental permitting issues for reservoir operation
remain significant. While the reservoir elevation was lowered due to DSOD restrictions,
the habitat for the Fountain Thistle, an endangered plant, followed the lowered
reservoir elevation. Raising the reservoir elevation now requires that new plant
populations be restored incrementally before the reservoir elevation is raised. The
result is that it may be several years before pre-project water storage volumes can be
restored.
• Regional Groundwater Storage and Recovery Project
The Groundwater Storage and Recovery (GSR) Project is a strategic partnership between
SFPUC and three San Mateo County agencies – the California Water Service Company
(serving South San Francisco and Colma), the City of Daly City, and the City of San Bruno
– to conjunctively operate the south Westside Groundwater Basin. The project
sustainably manages groundwater and surface water resources in a way that provides
supplies during times of drought. During years of normal or heavy rainfall, the project
would provide additional surface water to the partner agencies in San Mateo County in
lieu of groundwater pumping. Over time, reduced pumping creates water storage
through natural recharge of up to 20 billion gallons of new water supply available during
dry years.
The project’s Final Environmental Impact Report was certified in August 2014, and the
project also received Commission approval that month. Phase 1 of this project consists
of construction of thirteen well sites and is over 99 percent complete. Phase 2 of this
project consists of completing construction of the well station at the South San
Francisco Main site and some carryover work that has not been completed from Phase
1. Phase 2 design work began in December 2019.
• 2 MGD Dry‐year Water Transfer
In 2012, the dry-year transfer was proposed between the Modesto Irrigation District
and the SFPUC. Negotiations were terminated because an agreement could not be
reached. Subsequently, the SFPUC had discussions with the Oakdale Irrigation District
for a one-year transfer agreement with the SFPUC for 2 MGD (2,240 acre-feet). No
progress towards agreement on a transfer was made in 2019, but the irrigation districts
recognize SFPUC’s continued interest and SFPUC will continue to pursue transfers.
In order to achieve its target of meeting at least 80 percent of its customer demand during
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droughts with a system demand of 265 MGD, the SFPUC must successfully implement the dry-
year water supply projects included in the WSIP.
Furthermore, the permitting obligations for the Calaveras Dam Replacement Project and the
Lower Crystal Springs Dam Improvements include a combined commitment of 12.8 MGD for
instream flows on average. When this is reduced for an assumed Alameda Creek Recapture
Project recovery of 9.3 MGD, the net loss of water supply is 3.5 MGD.
Alternative Water Supply Planning Program
The SFPUC is increasing and accelerating its efforts to acquire additional water supplies and
explore other projects that would increase overall water supply resilience through the
Alternative Water Supply Planning Program. The drivers for the program include: (1) the
adoption of the Bay-Delta Plan Amendment and the resulting potential limitations to RWS
supply during dry years, (2) the net supply shortfall following the implementation of WSIP, (3)
San Francisco’s perpetual obligation to supply 184 MGD to the Wholesale Customers, (4)
adopted Level of Service Goals to limit rationing to no more than 20 percent system-wide
during droughts, and (5) the potential need to identify water supplies that would be required to
offer permanent status to interruptible customers. Developing additional supplies through this
program would reduce water supply shortfalls and reduce rationing associated with such
shortfalls. The planning priorities guiding the framework of the Alternative Water Supply
Planning Program are as follows:
1. Offset instream flow needs and meet regulatory requirements
2. Meet existing obligations to existing permanent customers
3. Make interruptible customers permanent
4. Meet increased demands of existing and interruptible customers
In conjunction with these planning priorities, the SFPUC considers how the program fits within
the LOS Goals and Objectives related to water supply and sustainability when considering new
water supply opportunities. The key LOS Goals and Objectives relevant to this effort can be
summarized as:
• Meet dry-year delivery needs while limiting rationing to a maximum of 20 percent
system-wide reduction in water service during extended droughts;
• Diversify water supply options during non-drought and drought periods;
• Improve use of new water sources and drought management, including groundwater,
recycled water, conservation, and transfers;
• Meet, at a minimum, all current and anticipated legal requirements for protection of
fish and wildlife habitat;
• Maintain operational flexibility (although this LOS Goal was not intended explicitly for
the addition of new supplies, it is applicable here).
Together, the planning priorities and LOS Goals and Objectives provide a lens through which
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the SFPUC considers water supply options and opportunities to meet all foreseeable water
supply needs.
In addition to the Daly City Recycled Water Expansion project 62, which was a potential project
identified in the 2015 UWMP and had committed funding at that time, the SFPUC has taken
action to fund the study of potential additional water supply projects. Capital projects under
consideration to develop additional water supplies include surface water storage expansion,
recycled water expansion, water transfers, desalination, and potable reuse. A more detailed list
and descriptions of these efforts are provided below.
The capital projects that are under consideration would be costly and are still in the early
feasibility or conceptual planning stages. Because these water supply projects would take 10 to
30 years to implement, and because required environmental permitting negotiations may
reduce the amount of water that can be developed, the yield from these projects are not
currently incorporated into SFPUC’s supply projections. State and federal grants and other
financing opportunities would be pursued for eligible projects, to the extent feasible, to offset
costs borne by ratepayers.
• Daly City Recycled Water Expansion (Regional, Normal- and Dry-Year Supply)
This project can produce up to 3 MGD of tertiary recycled water during the irrigation
season (~7 months). On an average annual basis, this is equivalent to 1.25 MGD or
1,400 acre-feet per year. The project is envisioned to provide recycled water to 13
cemeteries and other smaller irrigation customers, offsetting existing groundwater
pumping from the South Westside Groundwater Basin; this will free up groundwater,
enhancing the reliability of the Basin. The project is a regional partnership between the
SFPUC and Daly City. The irrigation customers are located largely within California
Water Service's (Cal Water's) service area. RWS customers will benefit from the
increased reliability of the South Westside Basin for additional drinking water supply
during droughts. In this way, this project supports the GSR Project, which is under
construction.
• ACWD‐USD Purified Water Partnership (Regional, Normal- and Dry-Year Supply)
This project could provide a new purified water supply utilizing Union Sanitary District's
(USD) treated wastewater. Purified water produced by advanced water treatment at
USD could be transmitted to the Quarry Lakes Groundwater Recharge Area to
supplement recharge into the Niles Cone Groundwater Basin or put to other uses in
Alameda County Water District’s (ACWD) service area. With the additional water supply
to ACWD, an in-lieu exchange with the SFPUC would result in more water left in the
RWS. Additional water supply could also be directly transmitted to the SFPUC through a
new intertie between ACWD and the SFPUC.
62 While this potential project was identified in the 2015 UWMP, it has since been approved by Daly City following
environmental review and has a higher likelihood of being implemented.
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• Crystal Springs Purified Water (Regional, Normal- and Dry-Year Supply)
The Crystal Springs Purified Water (PREP) Project is a purified water project that could
provide 6-12 MGD of water supply through reservoir water augmentation at Crystal
Springs Reservoir, which is a facility of the RWS. Treated wastewater from Silicon Valley
Clean Water (SVCW) and/or the City of San Mateo would go through an advanced water
treatment plant to produce purified water that meets state and federal drinking water
quality standards. The purified water would then be transmitted 10-20 miles
(depending on the alignment) to Crystal Springs Reservoir, blended with regional surface
water supplies and treated again at Harry Tracy Water Treatment Plant. Project
partners include the SFPUC, BAWSCA, SVCW, CalWater, Redwood City, Foster City, and
the City of San Mateo. Partner agencies are contributing financial and staff resources
towards the work effort.
• Los Vaqueros Reservoir Expansion (Regional, Dry Year Supply)
The Los Vaqueros Reservoir Expansion (LVE) Project is a storage project that will enlarge
the existing reservoir located in northeastern Contra Costa County from 160,000 acre-
feet to 275,000 acre-feet. While the existing reservoir is owned and operated by the
Contra Costa Water District (CCWD), the expansion will have regional benefits and will
be managed by a Joint Powers Authority (JPA) that will be set up prior to construction.
Meanwhile, CCWD is leading the planning, design and environmental review efforts.
CCWD’s Board certified the EIS/EIR and approved the LVE Project on May 13, 2020. The
additional storage capacity from the LVE Project would provide a dry year water supply
benefit to the SFPUC. BAWSCA is working in concert with the SFPUC to support their
work effort on the LVE project.
o Conveyance Alternatives: The SFPUC is considering two main pathways to move
water from storage in a prospective LVE Project to the SFPUC’s service area,
either directly to RWS facilities or indirectly via an exchange with partner
agencies. The SFPUC is evaluating potential alignments for conveyance.
o Bay Area Regional Reliability Shared Water Access Program (BARR SWAP): As
part of the BARR Partnership, a consortium of 8 Bay Area water utilities
(including ACWD, BAWSCA, CCWD, EBMUD, Marin Municipal Water District
(MMWD), SFPUC, Valley Water, and Zone 7 Water Agency) are exploring
opportunities to move water across the region as efficiently as possible,
particularly during times of drought and emergencies. The BARR agencies are
proposing two separate pilot projects in 2020-2021 through the Shared Water
Access Program (SWAP) to test conveyance pathways and identify potential
hurdles to better prepare for sharing water during a future drought or
emergency. A strategy report identifying opportunities and considerations will
accompany these pilot transfers and will be completed in 2021.
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• Bay Area Brackish Water Desalination (Regional, Normal- and Dry-Year Supply)
The Bay Area Brackish Water Desalination (Regional Desalination) Project is a
partnership between CCWD, the SFPUC, Valley Water, and Zone 7 Water Agency. East
Bay Municipal Utilities District (EBMUD) and ACWD may also participate in the project.
The project could provide a new drinking water supply to the region by treating brackish
water from CCWD's existing Mallard Slough intake in Contra Costa County. While this
project has independent utility as a water supply project, for the current planning effort
the SFPUC is considering it as a source of supply for storage in LVE. While the allocations
remain to be determined among partners, the SFPUC is considering a water supply
benefit of between 5 and 15 MGD during drought conditions when combined with
storage at LVE.
• Calaveras Reservoir Expansion (Regional, Dry Year Supply)
Calaveras Reservoir would be expanded to create 289,000 AF additional capacity to
store excess Regional Water System supplies or other source water in wet and normal
years. In addition to reservoir enlargement, the project would involve infrastructure to
pump water to the reservoir, such as pump stations and transmission facilities.
• Groundwater Banking
Groundwater banking in the Modesto Irrigation District (MID) and Turlock Irrigation
District (TID) service areas could be used to provide some additional water supply to
meet instream releases in dry years reducing water supply impacts to the SFPUC service
area. For example, additional surface water could be provided to irrigators in wet years,
which would offset the use of groundwater, thereby allowing the groundwater to
remain in the basin rather than be consumptively used. The groundwater that remains
in the basin can then be used in a subsequent dry year for irrigation, freeing up surface
water that would have otherwise been delivered to irrigators to meet instream flow
requirements.
A feasibility study of this option is included in the proposed Tuolumne River Voluntary
Agreement. Progress on this potential water supply option will depend on the
negotiations of the Voluntary Agreement.
• Inter‐Basin Collaborations
Inter-Basin Collaborations could provide net water supply benefits in dry years by
sharing responsibility for in-stream flows in the San Joaquin River and Delta more
broadly among several tributary reservoir systems. One mechanism by which this could
be accomplished would be to establish a partnership between interests on the
Tuolumne River and those on the Stanislaus River, which would allow responsibility for
streamflow to be assigned variably based on the annual hydrology.
As is the case with Groundwater Banking, feasibility of this option is included in the
proposed Tuolumne River Voluntary Agreement.
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If all the projects identified through the current planning process can be implemented, there
would still be a supply shortfall to meet projected needs. Furthermore, each of the supply
options being considered has its own inherent challenges and uncertainties that may affect the
SFPUC’s ability to implement it.
Given the limited availability of water supply alternatives - unless the supply risks are
significantly reduced or our needs change significantly - the SFPUC will continue to plan,
develop and implement all project opportunities that can help bridge the anticipated water
supply gaps during droughts. In 2019, the SFPUC completed a survey among water and
wastewater agencies within the service area to identify additional opportunities for purified
water. Such opportunities remain limited, but the SFPUC continues to pursue all possibilities.
Coordinated Efforts Between BAWSCA and the SFPUC to Develop of Alternative
Water Supplies
With the adoption of the Bay-Delta Plan Phase 1 (Bay-Delta Plan) by the SWRCB in December of
2018, coupled with the uncertainties associated with litigation and the development of
Voluntary Agreements that, if successful, would provide an alternative to the 40% unimpaired
flow requirement that is required by the Bay-Delta Plan, BAWSCA redoubled its efforts to
ensure that the SFPUC took necessary action to develop alternative water supplies such that
they would be in place to fill any potential gap in supply by implementation of the Bay-Delta
Plan and that the SFPUC would be able to meet its legal and contractual obligations to its
Wholesale Customers.
In 2019, BAWSCA held numerous meetings with the SFPUC encouraging them to develop a
division within their organization whose chief mission was to spearhead alternative water
supply development. On June 25, 2019, BAWSCA provided a written and oral statement to the
Commissioners urging the SFPUC to focus on developing new sources of supply in a manner
similar to how it addressed the implementation of the WSIP. BAWSCA urged that a new water
supply program was called for, with clear objectives, persistent focus, a dedicated team,
adequate funding, and a plan for successful execution. The SFPUC Commission supported
BAWSCA’s recommendation and directed staff to undertake such an approach.
In early 2020, the SFPUC began implementation of the AWSP, a program designed to
investigate and plan for new water supplies to address future long-term water supply reliability
challenges and vulnerabilities on the RWS.
Included in the AWSP is a suite of diverse, non-traditional supply projects that, to a great
degree, leverage regional partnerships and are designed to meet the water supply needs of the
SFPUC Retail and Wholesale Customers through 2045. As of the most recent Alternative Water
Supply Planning Quarterly Update, SFPUC has budgeted $264 million over the next ten years to
fund water supply projects. BAWSCA is heavily engaged with the SFPUC on its AWSP efforts.
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Climate Change
The issue of climate change has become an important factor in water resources planning in the
State, and is frequently considered in urban water management planning processes, though the
extent and precise effects of climate change remain uncertain. There is convincing evidence
that increasing concentrations of greenhouse gasses have caused and will continue to cause a
rise in temperatures around the world, which will result in a wide range of changes in climate
patterns. Moreover, observational data show that a warming trend occurred during the latter
part of the 20th century and virtually all projections indicate this will continue through the 21st
century. These changes will have a direct effect on water resources in California, and numerous
studies have been conducted to determine the potential impacts to water resources. Based on
these studies, climate change could result in the following types of water resource impacts,
including impacts on the watersheds in the Bay Area:
• Reductions in the average annual snowpack due to a rise in the snowline and a
shallower snowpack in the low and medium elevation zones, such as in the Tuolumne
River basin, and a shift in snowmelt runoff to earlier in the year;
• Changes in the timing, annual average, intensity and variability of precipitation, and an
increased amount of precipitation falling as rain rather than snow;
• Long-term changes in watershed vegetation and increased incidence of wildfires that
could affect water quality and quantity;
• Sea level rise and an increase in saltwater intrusion;
• Increased water temperatures with accompanying potential adverse effects on some
fisheries and water quality;
• Increases in evaporation and concomitant increased irrigation need; and
• Changes in urban and agricultural water demand.
Both the SFPUC and BAWSCA participated in the 2020 update of the Bay Area Integrated
Regional Water Management Plan (BAIRWMP), which includes an assessment of the potential
climate change vulnerabilities of the region’s water resources and identifies climate change
adaptation strategies. In addition, the SFPUC continues to study the effect of climate change
on the RWS. These works are summarized below.
Bay Area Integrated Regional Water Management Plan
Climate change adaptation continues to be an overarching theme for the 2019 BAIRWMP
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update. As stated in the BAIRWMP, identification of watershed characteristics that could
potentially be vulnerable to future climate change is the first step in assessing vulnerabilities of
water resources in the Bay Area Region (Region). Vulnerability is defined as the degree to
which a system is exposed to, susceptible to, and able to cope with or adjust to, the adverse
effects of climate change. A vulnerability assessment was conducted in accordance with the
Department of Water Resources’ (DWR’s) Climate Change Handbook for Regional Water
Planning and using the most current science available for the Region. The vulnerability
assessment, summarized in the table below, provides the main water planning categories
applicable to the Region and a general overview of the qualitative assessment of each category
with respect to anticipated climate change impacts.
Summary of BAIRWMP Climate Change Vulnerability Assessment
Vulnerability
Areas General Overview of Vulnerabilities
Water Demand Urban and Agricultural Water Demand – Changes to hydrology in the
Region as a result of climate change could lead to changes in total
water demand and use patterns. Increased irrigation (outdoor
landscape or agricultural) is anticipated to occur with temperature
rise, increased evaporative losses due to warmer temperature, and a
longer growing season. Water treatment and distribution systems are
most vulnerable to increases in maximum day demand.
Water Supply Imported Water – Imported water derived from the Sierra Nevada
sources and Delta diversions provide 66 percent of the water
resources available to the Region. Potential impacts on the availability
of these sources resulting from climate change directly affect the
amount of imported water supply delivered to the Region.
Regional Surface Water – Although future projections suggest that
small changes in total annual precipitation over the Region will not
change much, there may be changes to when precipitation occurs
with reductions in the spring and more intense rainfall in the winter.
Regional Groundwater – Changes in local hydrology could affect
natural recharge to the local groundwater aquifers and the quantity of
groundwater that could be pumped sustainably over the long-term in
some areas. Decreased inflow from more flashy or more intense
runoff, increased evaporative losses and warmer and shorter winter
seasons can alter natural recharge of groundwater. Salinity intrusion
into coastal groundwater aquifers due to sea-level rise could interfere
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Vulnerability
Areas General Overview of Vulnerabilities
with local groundwater uses. Furthermore, additional reductions in
imported water supplies would lead to less imported water available
for managed recharge of local groundwater basins and potentially
more groundwater pumping in lieu of imported water availability.
Water Quality Imported Water – For sources derived from the Delta, sea-level rise
could result in increases in chloride and bromide (a disinfection by-
product (DBP) precursor that is also a component of sea water),
potentially requiring changes in treatment for drinking water.
Increased temperature could result in an increase in algal blooms,
taste and odor events, and a general increase in DBP formation
Regional Surface Water – Increased temperature could result in lower
dissolved oxygen in streams and prolong thermocline stratification in
lakes and reservoirs forming anoxic bottom conditions and algal
blooms. Decrease in annual precipitation could result in higher
concentrations of contaminants in streams during droughts or in
association with flushing rain events. Increased wildfire risk and
flashier or more intense storms could increase turbidity loads for
water treatment.
Regional Groundwater – Sea-level rise could result in increases in
chlorides and bromide for some coastal groundwater basins in the
Region. Water quality changes in imported water used for recharge
could also impact groundwater quality.
Sea‐Level Rise Sea-level rise is additive to tidal range, storm surges, stream flows,
and wind waves, which together will increase the potential for higher
total water levels, overtopping, and erosion.
Much of the bay shoreline is comprised of low-lying diked baylands
which are already vulnerable to flooding. In addition to rising mean
sea level, continued subsidence due to tectonic activity will increase
the rate of relative sea-level rise.
As sea-level rise increases, both the frequency and consequences of
coastal storm events, and the cost of damage to the built and natural
environment, will increase. Existing coastal armoring (including levees,
breakwaters, and other structures) is likely to be insufficient to
protect against projected sea-level rise. Crest elevations of structures
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Vulnerability
Areas General Overview of Vulnerabilities
will have to be raised or structures relocated to reduce hazards from
higher total water levels and larger waves.
Flooding Climate change projections are not sensitive enough to assess
localized flooding, but the general expectation is that more intense
storms would occur thereby leading to more frequent, longer and
deeper flooding.
Changes to precipitation regimes may increase flooding.
Elevated Bay elevations due to sea-level rise will increase backwater
effects exacerbating the effect of fluvial floods and storm drain
backwater flooding.
Ecosystem and
Habitat
Changes in the seasonal patterns of temperature, precipitation, and
fire due to climate change can dramatically alter ecosystems that
provide habitats for California’s native species. These impacts can
result in species loss, increased invasive species ranges, loss of
ecosystem functions, and changes in vegetation growing ranges.
Reduced rain and changes in the seasonal distribution of rainfall may
alter timing of low flows in streams and rivers, which in turn would
have consequences for aquatic ecosystems. Changes in rainfall
patterns and air temperature may affect water temperatures,
potentially affecting coldwater aquatic species.
Bay Area ecosystems and habitat provide important ecosystem
services, such as: carbon storage, enhanced water supply and quality,
flood protection, food and fiber production. Climate change is
expected to substantially change several of these services.
The region provides substantial aquatic and habitat-related
recreational opportunities, including: fishing, wildlife viewing, and
wine industry tourism (a significant asset to the region) that may be at
risk due to climate change effects.
Hydropower Currently, several agencies in the Region produce or rely on
hydropower produced outside of the Region for a portion of their
power needs. As the hydropower is produced in the Sierra, there may
be changes in the future in the timing and amount of energy produced
due to changes in the timing and amount of runoff as a result of
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Vulnerability
Areas General Overview of Vulnerabilities
climate change.
Some hydropower is also produced within the region and could also
be affected by changes in the timing and amount of runoff.
Source: 2019 Bay Area Integrated Regional Water Management Plan (BAIRWMP), Table 16-3.
SFPUC Climate Change Studies
The SFPUC views assessment of the effects of climate change as an ongoing project requiring
regular updating to reflect improvements in climate science, atmospheric/ocean modeling, and
human response to the threat of greenhouse gas emissions. Climate change research by the
SFPUC began in 2009 and continues to be refined. In its 2012 report “Sensitivity of Upper
Tuolumne River Flow to Climate Change Scenarios,” the SFPUC assessed the sensitivity of runoff
into Hetch Hetchy Reservoir to a range of changes in temperature and precipitation due to
climate change. Key conclusions from the report include the following:
• With differing increases in temperature alone, the median annual runoff at Hetch Hetchy
would decrease by 0.7-2.1% from present-day conditions by 2040 and by 2.6-10.2% from
present-day by 2100. Adding differing decreases in precipitation on top of temperature
increases, the median annual runoff at Hetch Hetchy would decrease by 7.6-8.6% from
present-day conditions by 2040 and by 24.7-29.4% from present-day conditions by 2100.
• In critically dry years, these reductions in annual runoff at Hetch Hetchy would be
significantly greater, with runoff decreasing up to 46.5% from present day conditions by
2100 utilizing the same climate change scenarios.
• In addition to the total change in runoff, there will be a shift in the annual distribution of
runoff. Winter and early spring runoff would increase and late spring and summer runoff
would decrease.
• Under all scenarios, snow accumulation would be reduced and snow would melt earlier
in the spring, with significant reductions in maximum peak snow water equivalent under
most scenarios.
Currently, the SFPUC is conducting a comprehensive assessment of the potential effects of
climate change on water supply using a wide range of plausible increases in temperature and
changes in precipitation to address the wide uncertainty in climate projections over the planning
horizon 2020 to 2070. There are many uncertain factors such as climate change, changing
regulations, water quality, growth and economic cycles that may create vulnerabilities for the
Regional Water System’s ability to meet levels of service. The uncertainties associated with the
degree to which these factors will occur and how much risk they present to the water system is
difficult to predict, but nonetheless they need to be considered in SFPUC planning. To address
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this planning challenge, the project uses a vulnerability-based planning approach to explore a
range of future conditions to identify vulnerabilities, assess the risks associated with these
vulnerabilities that could lead to developing an adaptation plan that is flexible and robust to a
wide range of future outcomes.
Local Plans to Ensure a Reliable Water Supply
The City has been a leader in combating climate change while recognizing that its impact will
not be avoided and mitigation measures will be needed. To that end, the City adopted a Sea
Level Rise Adaptation Policy in March 2019 63. The City has begun a vulnerability assessment
which will include an evaluation of the impact of sea level rise on wastewater treatment and
utilities facilities and infrastructure. The vulnerability assessment will be followed by an
implementation plan.
The City has completed several studies and projects regarding water supply reliability. Of note,
the City completed the Emergency Water Supply and Storage Project and certified the Project
EIR for Phase 3 of the recycled water project. In addition, the City is continuing to evaluate
other water supply alternatives as part of a One Water plan. This analysis will include the
impact of long-term water supply shortage on the total water supply.
63 See Palo Alto’s Seas Level Rise Adaptation Policy:
https://www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=71340.78&BlobID=70115
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Section 7 – Water Shortage Contingency Plan
Law
10632. (a) Every urban water supplier shall prepare and adopt a water shortage contingency plan
as part of its urban water management plan that consists of each of the following elements:
(2) The procedures used in conducting an annual water supply and demand assessment.
(3) (A) Six standard water shortage levels corresponding to progressive ranges of up to 10, 20, 30,
40, and 50 percent shortages and greater than 50 percent shortage.
(4) Shortage response actions that align with the defined shortage levels…
(5) Communication protocols and procedures to inform customers, the public, interested parties,
and local, regional, and state governments…
(6) For an urban retail water supplier, customer compliance, enforcement, appeal, and
exemption procedures for triggered shortage response actions…
(7) (A) A description of the legal authorities that empower the urban water supplier to
implement and enforce its shortage response actions specified in paragraph (4) that may include,
but are not limited to, statutory authorities, ordinances, resolutions, and contract provisions.
(B) A statement that an urban water supplier shall declare a water shortage emergency in
accordance with Chapter 3 (commencing with Section 350) of Division 1. (C) A statement that an
urban water supplier shall coordinate with any city or county within which it provides water
supply services for the possible proclamation of a local emergency, as defined in Section 8558 of
the Government Code.
(8) A description of the financial consequences of, and responses for, drought conditions…
(9) For an urban retail water supplier, monitoring and reporting requirements and procedures…
(10) Reevaluation and improvement procedures for systematically monitoring and evaluating the
functionality of the water shortage contingency plan in order to ensure shortage risk tolerance is
adequate and appropriate water shortage mitigation strategies are implemented as needed.
Background
Except for recycled water, the City does not currently produce any of its own water supplies,
but is dependent upon its suppliers. The City’s primary supplier is the SFPUC. The SFPUC is the
only supplier in normal years. The City’s five older wells have been refurbished and the City
completed construction of three new wells to remain in standby for use during emergencies
and potentially to supplement the SFPUC supply during a severe drought. The Valley Water
manages the county’s groundwater and levies a groundwater extraction fee for all water
produced by the wells within its jurisdictions. The City has also approved and signed a mutual
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aid agreement for emergency water supplies with California’s Water Agency Response Network
(Coastal group) that has over 75 signatories.
To meet the requirements of the Urban Water Management Planning Act and for the purposes
of this document, a distinction will be made between a catastrophic interruption of water
supplies and a water shortage due to drought. A catastrophic interruption of water supplies
may occur due to natural disaster such as an earthquake or due to a sudden problem with
water quality, or because of sabotage or terrorism. A water shortage due to drought is the
more likely occurrence. The City has experienced three drought water shortages in the past 35
years, in l976-77, from l987 to l993, and 2014-2016 drought.
Preparation for Catastrophic Supply Interruption
The SFPUC maintains various planning documents which collectively address its emergency
preparedness and planned response in the event of a catastrophic interruption of water supplies
due to power outages, earthquakes, or other disasters. These plans are described in sections 1.1
(Emergency Preparedness Plans), 1.2 (Emergency Drinking Water Planning), and 1.3 (Power
Outage Preparedness and Response) below. Section 1.4 addresses the seismic risk assessment
and mitigation plan required by California Water Code Section 10632.5.(a). Should a
catastrophic interruption occur, the SFPUC will coordinate with any city or county within which it
provides water for the possible proclamation of a local emergency (California Government Code,
California Emergency Services Act Article 2, Section 8558).
Emergency Preparedness Plans
Following the 1989 Loma Prieta Earthquake, the SFPUC created a departmental Emergency
Operations Plan (EOP). The SFPUC EOP was originally released in 1992 and has been updated as
necessary ever since. Most recently, the SFPUC developed a Water System Emergency
Response Plan (Water ERP) to comply with the America’s Water Infrastructure Act (AWIA)
passed in 2018. The Water ERP acts as a unifying document, integrating and referencing
common components of SFPUC plans and programs that have been developed to date. The
Water ERP is intended to address water transmission and distribution systems and identify
the Enterprises, Divisions, and Bureaus with direct roles and responsibilities. The Water ERP
integrates directly into, and functions as an annex to, the SFPUC Emergency Operations Plan
(EOP). The SFPUC EOP addresses a broad range of potential emergency situations that may affect
the SFPUC and supplements the City’s Emergency Response Plan, which was prepared by the
Department of Emergency Management and most recently updated in 2017. Specifically, the
purpose of the SFPUC EOP is to describe its emergency management organization, roles and
responsibilities, and emergency policies and procedures.
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In addition, SFPUC divisions and bureaus each have their own Division Emergency Operations Plans
(DEOP) (in alignment with the SFPUC EOP), which detail that entity’s specific emergency
management organization, roles and responsibilities, and emergency policies and procedures.
The SFPUC tests its DEOPs on a regular basis by conducting emergency exercises. Through these
exercises, the SFPUC learns how well the plans and procedures will or will not work in response to
an emergency. DEOP improvements are based on the results of these exercises and real-world
event response and evaluation. The SFPUC also has an emergency response training plan that is
based on federal, State, and local standards and exercise and incident improvement plans. SFPUC
employees have emergency training requirements that are based on their emergency response
roles.
The SFPUC EOP functions as a front end for the SFPUC’s DEOPs, covering emergency
response at the Department level; while each DEOP covers Division-specific information on
the Division’s emergency organization and response procedures specific to Division
responsibilities, assets, technical scope, and operations. The types of events affecting SFPUC that
may require emergency plans include but are not limited to:
• Major earthquake
• Loss of power
• Loss of water supply
• Major fire
• Hazardous material release that threatens water supply or environment
• Major pipeline breaks
• Dam break
• Significant outage of SFPUC services
• Man-made or intentional acts of terrorism resulting in damage to the system or
interruption in service
In addition to the documents described above, the SFPUC also maintains various plans and
procedures that deal with the possibility of alternate supply schemes and options. These include:
• Emergency Disinfection and Recovery Plan (EDRP);
• Emergency Response Action Plan (ERAP);
• Emergency Drinking Water Equipment and Alternatives Report;
• Disinfection of SFPUC Water Trailers Procedure;
• City Distribution Division Hydrant Manifold Standard Operating Procedure; and
• Pilot plant trailer (Mobile Pilot Plan O&M Plan)
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Emergency Drinking Water Planning
In February 2005, the SFPUC published the City Emergency Drinking Water Alternatives report. The
purpose of this report was to outline a plan for supplying emergency drinking water in the City after
damage and/or contamination of the SFPUC raw and/or treated water systems resulting from a
major disaster. Since the publication of this report, the SFPUC has implemented a number of projects
to increase its capability to support the provision of emergency drinking water during an emergency.
These projects include:
• Completion of WSIP projects and other capital upgrades to improve security,
detection, and communication (see Section 1.4);
• Public Information and materials for home and business;
• Construction of a disinfection and fill station at the existing San Francisco Zoo well,
and obtaining a permit to utilize this well as a standby emergency drinking water
source;
• Constructed six wells as part of the San Francisco Groundwater Supply Project, two of
which also serve as emergency drinking water supplies, including a distribution system
to fill emergency water tankers;
• Purchase and engineering of emergency-related equipment, including water tanker
trucks and water distribution manifolds, to help with distribution post-disaster; and
• Coordination of planning with other City departments, neighboring jurisdictions, and
other public and private partners to maximize resources and supplies for emergency
response.
The SFPUC has also prepared the RWS Water Quality Notifications and Communications Plan.
This plan, which was first prepared in 1996 and was most recently updated in 2017, provides
contact information, procedures, and guidelines to be implemented by several SFPUC divisions,
wholesale customers, and BAWSCA in the event of water quality impacts. The plan treats water
quality issues as potential or actual supply problems, which fall under the emergency response
structure of the SFPUC ERP.
Power Outage Preparedness and Response
The SFPUC’s water transmission system is primarily gravity fed. Although water conveyance
throughout the RWS would not be greatly impacted by power outages because it is gravity fed,
the SFPUC has prepared for potential regional power outages as follows:
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• The Tesla Treatment Facility, the Sunol Valley Water Treatment Plant (SVWTP), and the
San Antonio Pump Station have back-up power on site in the form of generators or diesel-
powered pumps. Additionally, both the SVWTP and San Antonio Pump Station would not
be impacted by a failure of the regional power grid because these facilities are powered
by hydropower generated by the Hetch Hetchy Water and Power System;
• Both the Harry Tracy Water Treatment Plant (HTWTP) and the Baden Pump
Station (part of the Peninsula System) have back-up generators in place;
• Administrative facilities that will act as emergency operation centers also have back-up
power;
• The SFPUC has an emergency water supply connection with the Valley Water,
which also has back-up generators in place; and
• The WSIP includes projects that expand the SFPUC’s ability to remain in operation
during power outages and other emergency situations.
Seismic Risk Assessment and Mitigation Plan
As part of the Facilities Reliability Program and the WSIP, the SFPUC performed an extensive
multi-year evaluation of seismic risks to its water system that resulted in major capital
improvements to increase seismic reliability. The goals of WSIP include enhancing the ability of
the SFPUC water system to meet identified service goals for water quality, seismic reliability,
delivery reliability, and water supply. One of the original goals of WSIP was to limit rationing to
no more than 20 percent on a system-wide basis; the WSIP was developed to reduce the
likelihood of shortages, thereby reducing the likelihood of needing to implement the WSCP.
The WSIP projects include several projects located in San Francisco to improve the seismic
reliability of the in- City distribution system, including more wells that can be used as emergency
drinking water sources. The WSIP also incorporates many projects related to the RWS to
address both seismic reliability and overall system reliability. As of August 2018, the WSIP is
over 96 percent complete. Local San Francisco projects are 100 percent complete as of June
2020. The current forecasted date to complete the overall WSIP is December 2021.
WSIP seismic LOS informed development of capital projects and guided program
implementation. The LOS established post-earthquake delivery and recovery objectives under
the following seismic scenarios:
• Magnitude 7.9 event on the San Andreas fault
• Magnitude 7.3 event on the Hayward fault
• Magnitude 6.9 event on the Calaveras fault
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An assessment of seismic risk and resilience is contained in the body of analysis performed to
support the WSIP. The risks associated with the seismic scenarios considered are reflected in
the delivery objectives established in the LOS, specifically:
• Delivery of winter month demand 24 hours after a major earthquake, and
• Delivery of average day demand 30 days after a major earthquake
In addition to the improvements that have or will come from the WSIP, the City has already
constructed system interties for use during catastrophic emergencies, short-term facility
maintenance and upgrade activities, and times of water shortages. These are listed below:
• A 35 MGD intertie with the EBMUD allowing EBMUD to serve the City of Hayward’s
demand and/or supply the SFPUC directly (and vice versa);
• A 40 MGD system intertie between the SFPUC and SCVWD; and,
• One permanent and one temporary intertie to the South Bay Aqueduct, which would
enable the SFPUC to receive State Water Project water.
The WSIP also includes projects related to standby power facilities at various locations. These
projects provide for standby electrical power at six critical facilities to keep them in operation
during power outages and other emergency situations. Permanent engine generators are
located at four locations (San Pedro Valve Lot, Millbrae Facility, Alameda West, and
HTWTP), while hookups for portable engine generators are at two locations (San Antonio
Reservoir and Calaveras Reservoir).The City of San Francisco also has a Hazard Mitigation
Plan which was last updated in June 2014 and includes sections describing earthquakes hazards
and mitigation for assets within the City’s boundary, including state-regulated reservoirs
(Sutro, Sunset North and South, and University Mound North and South).
Local Distribution System Reliability
The City has improved its emergency supply preparedness by rehabilitating five existing wells,
drilling three new wells, and building an additional water storage reservoir. The well system can
now support a minimum of eight hours of normal water use at the maximum day demand level
and four hours of fire suppression at the design fire duration level.
The City also maintains several critical interconnections with neighboring water utilities as shown
in Table 19. These interties can be activated during critical events to ensure water supplies are
not impacted and also to provide mutual aid to neighboring communities.
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Table 19: Interties with other Agencies
Name Number Diameter (inches)
East Palo Alto 1 6
Mountain 2 6
Stanford 2 8
Purissima Hills WD 2 8,12
Emergency Response Plan
Response to a catastrophic interruption of supply is handled through a series of interconnected
plans. All Disaster or Act of War Plans, from the state to local levels, use the Federal Civil
Defense and Emergency Planning systems as role models with additions that take into
consideration any unique conditions or situations that may exist within their jurisdictions.
At the national level, the Federal Emergency Management Agency (FEMA) controls all functions
of Civil Defense or Emergency Planning for the Federal Government. FEMA will not assume
control of an emergency until the President declares a State of Emergency or an Act of War
occurs. At that point FEMA will assume control through the State of California Office of
Emergency Services (State OES) and make available all of its resources.
At the state level, the State OES will control any disaster within the state and make its resources
available after a State of Disaster has been declared by the governor. The State OES further
controls the Master Mutual Aid Agreement that can also be used in a local disaster (the City is a
member of California’s Water Agency Response Network, Region 2, a mutual aid system for
water utilities, in accordance with State requirements).
At the county level, the Santa Clara County OES will control the unincorporated areas of the
County. It will coordinate mutual aid within the County and act as an intermediary between local
governments or utilities and the State mutual aid office.
On the city level, the City will control all emergencies according to its Emergency Response
Plan. The Mayor, City Council or City Manager may declare an emergency at which time
representatives of all City departments will report to the Emergency Operations Center.
The City’s Emergency Response Plan incorporates the CPAU Water, Gas and Wastewater
Operations Emergency Response Plan (the UER Plan), which covers any emergency curtailment
of water supplies. The UER Plan is a detailed outline of actions to be taken and procedures to
be followed by utility personnel in event of a water emergency. This plan is maintained in the
office of Water, Gas and Wastewater Operations and must be updated every 12 months.
The UER Plan is designed as both an outline and a procedures manual. It covers the following
primary functions:
1) Notification Procedures;
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2) Water Mutual Aid Agreement;
3) Radio/Telephone /Communications;
4) Water Receiving Station and Reservoir Check List;
5) Boil Water Notifications;
6) Highest Water Use Customer Load Reduction List;
7) Water Interconnect Locations; and
8) Disinfecting of Water Mains.
All CPAU personnel whose duties include work on the system through maintenance or
construction operations, or as Utilities Dispatchers, are highly trained and experienced in
performing their normal or “common emergency” duties. If a disaster or Act of War were to
occur, the City’s construction standards may have to be lowered to make temporary repairs to
expedite the restoration of the system, but the procedures and safety rules by which the work
would be accomplished will not change. These temporary repairs would be upgraded and made
permanent or replaced, as necessary, at a later date. The City’s primary concern is the safety of
the general public and all City personnel.
To that end, CPAU continues to maintain three diesel emergency generators in order to
enhance the water system response reliability during a catastrophic seismic event causing
severance from the City’s primary supply source, and is investigating additional purchases or
leases. Lease acquisition of these emergency generators will fulfill this reliability goal for the
medium- and the long-term. At the same time, given the uncertainty of the future, acquisition
through lease agreements for these emergency gen sets will reduce the City’s risk of generator
inoperability. Generators would enable continued operation of water facilities during a
transmission grid failure.
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Water Supply and Demand Assessment
Law
10632. (a)(2)
The procedures used in conducting an annual water supply and demand assessment that include,
at a minimum, both of the following:
(A) The written decision-making process that an urban water supplier will use each year to
determine its water supply reliability.
(B) The key data inputs and assessment methodology used to evaluate the urban water supplier’s
water supply reliability for the current year and one dry year, including all of the following: (i)
Current year unconstrained demand, considering weather, growth, and other influencing factors,
such as policies to manage current supplies to meet demand objectives in future years, as
applicable. (ii) Current year available supply, considering hydrological and regulatory conditions
in the current year and one dry year. The annual supply and demand assessment may consider
more than one dry year solely at the discretion of the urban water supplier. (iii) Existing
infrastructure capabilities and plausible constraints. (iv) A defined set of locally applicable
evaluation criteria that are consistently relied upon for each annual water supply and demand
assessment. (v) A description and quantification of each source of water supply.
Decision‐Making Process to Determine Water Supply Availability
In June 2020, Palo Alto provided an example of an annual Water Supply and Demand
Assessment (WSDA) report to support DWR in the development of guidelines for AB 1668 and
SB 606 implementation. To support this process, Palo Alto worked with the SFPUC and
BAWSCA to review existing water supply report processes and evaluate options to meet the
requirements of the legislation.
Palo Alto receives approximately 93% of its total water supply and 100% of its potable water
supply from SFPUC. The WSA between SFPUC and its Wholesale Customers requires SFPUC to
provide its Wholesale Customers with an initial assessment of water supply availability in each
February, followed by an update in March and a final assessment by April 15th of each calendar
year. These letters document whether SFPUC can provide full supplies for the coming water
year or whether rationing will be implemented. The determination of projected available water
supply considers, among other things, stored water, projected runoff, water acquired by the
SFPUC from non-SFPUC sources, inactive storage, reservoir losses, allowance for carryover
storage, and water bank balances.
To evaluate water supply availability for the current year and one dry year, Palo Alto will utilize
the BAWSCA Regional Reliability Model. The Regional Reliability Model aggregates hydrologic
data and operational rules from SFPUC and other sources to evaluate overall water supply
reliability. Table 20 describes the key data inputs and assumptions for modeling supply
availability to prepare an assessment report.
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Table 20: Key Input for the Water Supply and Demand Assessment
Input Description
Current Year Unconstrained Demand Total Water Production for the fiscal year
Current Year Available Supply SFPUC Water Supply Availability Estimate for
SFPUC supplies
U.S. Geological Survey (USGS) real-time gages
FY 1987-88 hydrologic conditions (selected
for statistical similarity to current year’s
hydrologic conditions)
Groundwater availability assumed based on
information and correspondence from
agencies who manage the basins
Expected groundwater and treated water
availability from sources managed by Valley
Water
One Additional Dry Year Available Supply FY 1976-77 hydrologic conditions (consistent
with UWMP single dry year assumptions)
Existing Infrastructure Capabilities and
Plausible Constraints
Modeling implicitly considers infrastructure
and storage constraints; Calaveras Dam
operations “hold point’ for slow refill is
represented in this analysis.
Data and Methodologies
Because Palo Alto relies on only one potable water supply source, SFPUC RWS water, the
Annual Assessment will rely on key data inputs from the SFPUC.
1. Evaluation Criteria
In April of each year, the SFPUC provides an assessment of the water supply situation
and alerts the Wholesale Customers of any voluntary or mandatory water use reduction
requirements. The SFPUC’s assessment of the water supply situation will serve as the
City’s evaluation criteria.
2. Water Supply
Palo Alto relies on RWS water for 100% of its potable water supply. Recycled water is
used on a limited basis for irrigation and industrial uses and cannot replace potable
water supplies in any significant way. Groundwater may be available to supplement
potable water needs in extreme circumstances.
3. Unconstrained Customer Demand
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Palo Alto will utilize the end-use model described in Section 4 with updated historical
water use to determine unconstrained demand. If significant land use or customer
water use changes have occurred, the model will be updated to reflect those changes.
4. Planned Water Use for Current Year Considering Dry Subsequent Year
Evaluation of how anticipated supplies for the particular coming year will be used, while
anticipating that the following year will be dry. Each year’s assessment is informed by
the characterizations in Chapter 6 and other current pertinent factors and
considerations.
5. Infrastructure Considerations
Any local Palo Alto capital projects that may impact delivery capacity such as main
replacements or emergency groundwater well work will be considered. The SFPUC’s
water supply assessment will take capacity constraints on the RWS into consideration.
6. Other factors
Because groundwater in Santa Clara County is managed by Valley Water, Palo Alto will
take into consideration any water use reductions anticipated to be implemented by
Valley Water for the coming year when deciding whether or not to incorporate
groundwater into the City’s supply for the following year.
Approval Process
The following are the functional steps to formally approve the Annual Drought Risk Assessment
(Annual Assessment).
1. Review by the Utilities Advisory Commission (UAC)
The Annual Assessment will be presented and discussed at a UAC meeting. The report
and presentation will include a request that the UAC recommend City Council approval
of the document and information regarding any specific WSCP response actions
triggered by the Annual Assessment results.
2. Adoption by City Council agenda
Upon UAC action, the City Council will adopt the Annual Assessment and will be notified
of any specific WSCP response actions triggered.
SFPUC Annual Water Supply and Demand Assessment Procedures
Each year the SFPUC evaluates the amount of total water storage expected to occur throughout
the RWS and compares it to expected demands. SFPUC’s annual WSDA is described in the
subsections below, which are organized by the sequential steps the SFPUC takes to conduct the
assessment each year and reference the relevant California Water Code requirements for a
WSDA.
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The SFPUC’s annual WSDA is a robust planning system that considers a range of input factors
unique to the SFPUC’s water supplies and system configuration while also providing the
flexibility to consider new factors. Traditional surface water supplies from the SFPUC’s up
country, East Bay, and Peninsula reservoirs are the backbone of the water supply, but the
SFPUC extends and protects those supplies in many additional ways by:
1. Partnering with the community to help save water through robust conservation
programs;
2. Minimizing the need for additional water to serve new developments through an
onsite water reuse program;
3. Recycling wastewater resources to deliver water for large non-potable uses;
4. Utilizing local groundwater supplies to supplement surface water supplies;
5. Investigating new, alternative water supply options such as purified water and
desalination; and
6. Investing in innovations that allow for creative solutions to meet diverse needs.
These efforts help the SFPUC conserve water and diversify supplies to reduce
likelihood of a water shortage condition.
Demand Assessment
To calculate unconstrained customer demand for the purpose of an annual WSDA, the
SFPUC collects information on both the retail and wholesale system demands. Retail Customer
demand is estimated based on the best available information to date, and typically includes the
previous year’s demands as well as consideration of current demand use patterns or other
conditions impacting demands, such as weather and growth. Each year, in February, the SFPUC
receives from BAWSCA a report of estimated Wholesale Customer demand for the upcoming
year. BAWSCA typically estimates unconstrained demands for the Wholesale Customers by
using total water purchased by those customers in the prior year along with other relevant
information. Relatively small demands from the two additional Wholesale Customers not part
of the WSA are estimated based on the best available information to date, and typically
includes the previous year’s demands as well as consideration of current demand use patterns
or other conditions impacting demands, such as weather and growth.
Supply Assessment
The RWS collects water from the Tuolumne River watershed in the Sierra Nevada and from local
reservoirs in the Alameda and Peninsula watersheds. The RWS draws an average of 85
percent of its supply from the Tuolumne River watershed. This water feeds into an aqueduct
system delivering water 167 miles by gravity to Bay Area reservoirs and customers. The
remaining RWS supply is drawn from local surface waters in the Alameda and Peninsula
watersheds. The split between these resources varies from year to year depending on the water
year hydrology and operational circumstances.
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To project and evaluate water supply conditions, the SFPUC uses measurements of precipitation
and snowpack in the watersheds above Hetch Hetchy, Cherry, and Eleanor Reservoirs.
Snowpack conditions are evaluated regularly by the Cooperative Snow Survey (conducted by
the SFPUC in partnership with state and federal agencies) beginning in late January of each
year. The SFPUC also estimates snowpack conditions using information from airborne snow
observatory (ASO) and other sources. The SFPUC maintains a hydrologic model of the watersheds
that uses this information to project expected runoff for the coming year. This process also
includes a statistical analysis of additional expected precipitation. In addition to projected
runoff, the determination of projected available water supply also takes into account stored
water throughout the RWS, water acquired by the SFPUC from non-SFPUC sources, inactive
storage, reservoir losses, and allowances for carryover storage.
Additionally, the SFPUC accounts for groundwater provided by the San Francisco Groundwater
Supply Project for the in-City retail system and recycled water provided for irrigation at Harding
Park, Fleming and Sharp Park Golf Courses.
The RWS relies on precipitation and snowmelt captured and stored in its reservoirs. During
droughts, water supply deliveries can exceed inflows, such that water stored in previous years
is relied upon to meet demands. Because of the importance of carry-over storage, the SFPUC
constantly monitors and evaluates water supply conditions in the RWS. Look-ahead forecasts
are updated as a year’s hydrology and operations change. Generally, in early winter of any
year, SFPUC staff can begin providing a forecast of water supply conditions for the upcoming
year based on known and anticipated winter and spring precipitation and snowpack. The
predictive power of this forecast improves greatly through the spring. The annual precipitation,
snowmelt, and carry-over storage together constitute the SFPUC’s reservoir storage condition.
Using data for each of these factors, the SFPUC can determine whether the reservoir system
will be capable of serving full deliveries to its customers.
Table 21 shows the availability of RWS supplies for Retail Customers and Wholesale Customers in
normal years. Table 22 shows the current and projected RWS supply needs to meet retail and
wholesale demands based on information and projections presented in the SFPUC’s 2020 UWMP.
The SFPUC sells water to 26 of its 28 wholesale customers under the terms of the 25-year WSA
between the City and County of San Francisco and Wholesale Customers in Alameda County,
San Mateo County, and Santa Clara County (WSA) and associated individual water sales
contracts with each Wholesale Customer. The WSA carries forward the SFPUC’s “Supply
Assurance” of 184 million gallons per day (MGD) to the Wholesale Customers. The SFPUC
has agreed to deliver water to the Wholesale Customers up to the amount of the Supply
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Assurance, and this agreement is perpetual and survives the expiration of the WSA. The Supply
Assurance is, however, subject to reduction due to water shortage, drought, scheduled RWS
maintenance activities, and emergencies. The WSA also describes the temporary limitation
on water sales established by the phased WSIP in 2008. This “Interim Supply Limitation” (ISL)
limits water sales from the RWS to an average annual amount of 265 MGD. The WSA allocations
the ISL between the SFPUC’s retail customers and Wholesale Customers as follows:
• Wholesale supply allocation: 184 MGD
• Retail supply allocation: 81 MGD 64
Table 21: RWS Supply Availability in Normal Years (MGD)
64 Groveland CSD is considered a retail customer of the SFPUC. Thus, RWS supplies to Groveland CSD are accounted for in the retail supply
allocation of 81 mgd.
RWS Supply Allocation
Actual Projected
2020 2025 2030 2035 2040 2045
Retail Customersa, b 81 81 81 81 81 81
Wholesale Customersc, d 184 184 184 184 184 184
Total RWS Supplies 265 265 265 265 265 265
a Groundwater and recycled water are assumed to be used before RWS supplies to meet retail demand. However, if these alternative supplies are not
available, up to 81 MGD of RWS supply could be used in normal years.
b Groveland CSD is reported as a wholesale customer for the purposes of this 2020 UWMP, but it is considered a retail customer of the SFPUC solely for
purposes of allocating RWS supplies between retail and Wholesale Customers. Its demands would be met by the retail supply allocation of 81 MGD.
c Projected Wholesale Customer deliveries are limited to 184 MGD, including the demands of the Cities of San Jose and Santa Clara, which are supplied on a
temporary and interruptible basis, with their total supply not exceeding 9 MGD assuming supply is available (decision to be made by end of 2028).
d Cordilleras MWC is not a party to the WSA, and it is not included in the wholesale supply allocation of 184 MGD. The demands of Cordilleras MWC are
minor (projected to be less than 0.01 MGD) and are anticipated to be met with RWS supplies through 2045.
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Table 22: RWS Supply Utilized in Normal Years (MGD)
Infrastructure Considerations
On an ongoing basis, the SFPUC’s Hetch Hetchy Water and Power, Water Supply and Treatment
Division, and Hydrology and Water Systems group conduct analyses of the RWS that incorporate
planned facility outages and multiple levels of projected system demands to evaluate and plan
for potential water delivery constraints. These groups meet quarterly to share plans and
coordinate how facility outages, changes in service area demand, wet or dry weather, and other
variables shape the operating plans each year. Facility outages due to maintenance or upgrades
are coordinated in an adaptive manner to respond to changes as they occur. For new water
supplies or new capital projects related to supply distribution, impacts on the system are
evaluated extensively prior to initiation of any changes. Results from these modeling efforts are
considered in the annual WSDA.
System Modeling
To proactively plan for conditions that would result in a shortage of water supplies, the SFPUC
models conditions using a hypothetical drought that is more severe than what the RWS has
historically experienced. This drought sequence is referred to as the “design drought” and
serves as the basis for planning and modeling of future scenarios. The design drought consists
of an 8.5-year sequence of dry conditions.
In applying its water supply planning methodology, the SFPUC performs an initial model
simulation of the system for the design drought sequence and then reviews the ability of the
system to deliver water to the service area through the entire design drought sequence. If the
projected water supply runs out before the end of the design drought sequence in the initial
model run, system-wide water supply rationing is added and the scenario is re- run. This
process continues iteratively until a model simulation of the system is achieved in which the
RWS Supply Allocation
Actual Projected
2020 2025 2030 2035 2040 2045
Retail Customersa, b 66.5 67.2 67.5 68.6 70.5 73.7
Wholesale Customersc, d 132.1 146.0 147.9 151.9 156.3 162.8
Total RWS Supplies 198.6 213.2 215.4 220.5 226.8 236.5
a Groundwater and recycled water are assumed to be used before RWS supplies to meet retail demand. However, if these alternative supplies are not
available, up to 81 MGD of RWS supply could be used in normal years.
b Groveland CSD is reported as a wholesale customer for the purposes of this 2020 UWMP, but it is considered a retail customer of the SFPUC solely for
purposes of allocating RWS supplies between retail and Wholesale Customers. Its demands would be met by the retail supply allocation of 81 MGD.
c Projected Wholesale Customer deliveries are limited to 184 MGD, including the demands of the Cities of San Jose and Santa Clara, which are supplied on a
temporary and interruptible basis, with their total supply not exceeding 9 MGD assuming supply is available (decision to be made by end of 2028).
d Cordilleras MWC is not a party to the WSA, and it is not included in the wholesale supply allocation of 184 MGD. The demands of Cordilleras MWC are
minor (projected to be less than 0.01 MGD) and are anticipated to be met with RWS supplies through 2045.
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water supply in storage at the end of the design drought sequence is brought to the system
“dead pool,” where no additional storage is available for delivery (currently simulated as
96,775 acre-feet). Drawing system storage down to the dead pool without going below it
indicates that water supply delivery, including the adjusted amount of rationing, is maintained
through the design drought sequence.
Estimated rationing levels and corresponding storage threshold values can then be used to
simulate the operation of the system through the historical record of hydrology, or to evaluate
system water supply conditions during an ongoing drought. While the design drought sequence
does not occur in the historical hydrology, the rationing and storage threshold values that are
adjusted to allow a system configuration to maintain water delivery through the design drought
sequence can be used to evaluate system performance in the historical record, or as a
comparison for real-time system conditions. Through use of this planning method, the SFPUC
can simulate a response to declining water supply in storage that is appropriate for the system
conditions being evaluated.
The SFPUC plans its water deliveries using indicators for water supply rationing that are
developed through analysis with the design drought sequence. As a result, the SFPUC system
operations are designed to provide sufficient carry-over water in SFPUC reservoirs to continue
delivering water, although at reduced levels, during multiple-year droughts.
Decision‐Making Process
Regardless of the expectation of shortage conditions, as part of the normal course of business,
the SFPUC provides a water supply condition update to its executive team every two weeks
throughout the year. The SFPUC also provides water supply estimates to its Wholesale
Customers on a monthly basis beginning February 1. A Wholesale Customer Annual Meeting
is held in the last week of February at which the SFPUC makes a presentation on current
water supply conditions and forecasts. The last snow survey of the season typically occurs
within the first week of April, followed by a runoff forecast to determine total system storage
expected as of July 1. By the middle of April, the SFPUC sends a formal letter to the Wholesale
Customers summarizing the water supply availability for the coming year.
If the RWS appears incapable of meeting system-wide demand due to drought, the SFPUC is
expected to declare a water shortage by March 31 of that drought year. The General Manager,
or designee, is responsible for declaring such a shortage. A presentation would be made to the
Commission as part of the General Manager’s report, showing conditions of precipitation to
date, snowpack, and storage levels with more information as necessary depending on the
particulars of the supply forecast. Depending on the level of shortage, the Commission may
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adopt a resolution declaring a water shortage emergency under the California Water Code, or
lesser actions such as a call for voluntary conservation efforts.
Prior to the initiation of any water delivery reductions to its retail customers, whether it be initial
implementation of delivery reductions or implementing a different water shortage level, the
SFPUC will outline a drought response plan to address the following: the water supply situation;
proposed water use reduction objectives; alternatives to water use reductions; methods to
calculate water use allocations and adjustments; compliance methodology and enforcement
measures; and budget considerations. Details on the expected allocation program are
described further in Section 8. This drought response plan will be presented at a regularly
scheduled SFPUC Commission meeting and advertised in accordance with the requirements of
Section 6066 of the California Government Code.
The overall WSDA process is shown in Figure 7.
Figure 7: SFPUC WSDA Process
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Water Shortage Contingency Plan
Law
10632.(a) Every urban water supplier shall prepare and adopt a water shortage contingency plan
as part of its urban water management plan…
(3)(A) Six standard water shortage levels corresponding to progressive ranges of up to 10, 20, 30,
40, and 50 percent shortages and greater than 50 percent shortage.
(4) Shortage response actions that align with the defined shortage levels and include, at a
minimum, all of the following: (A) Locally appropriate supply augmentation actions, (B) Locally
appropriate demand reduction actions to adequately respond to shortages, (C) Locally
appropriate operational changes, (D) Additional, mandatory prohibitions against specific water
use practices that are in addition to state-mandated prohibitions and appropriate to the local
conditions, (E) For each action, an estimate of the extent to which the gap between supplies and
demand will be reduced by implementation of the action.
Palo Alto’s Experience with Drought Management
The City has had considerable experience implementing action plans during a period of water
shortage, such as a drought. The City has always been able to comply with any rationing
requirement imposed by SFPUC. During the 1976/77 drought period, the City achieved
reductions in citywide consumption of 16% in FY 1977 and 37% in FY 1978 compared to
consumption in FY 1976. In the 1987-1993 drought period, the City’s consumption was lower
than consumption in 1987, the year just before SFPUC instituted mandatory rationing, by from
19% (in FY 1989) to over 35% (in FY 1992). In response to the voluntary 10% call for rationing in
2008-2009, the City responded with reductions of approximately 18% relative to 2004
consumption.
In 2015, the City responded to state-mandated potable water use reductions by implementing
the water restrictions in Stage II of its WSCP. The City exceeded the 24% cumulative reduction
target for the June 1, 2015 through May 31, 2016 compliance period compared to calendar year
2013; the City’s usage was 31% below usage during the same period in 2013 as shown in
Figure 8.
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Figure 8: Palo Alto Water use Reductions Compared to State‐Mandated Target
The community has responded exceedingly well to requests to use water in the most efficient
way possible. As a result of experiencing these drought-time water supply shortages, many
residents and businesses have implemented permanent improvements in water use efficiency.
During a water shortage period, the Director of Utilities is responsible for executing the WSCP.
Representatives from appropriate City Departments and Utilities Divisions are involved to
oversee outreach and monitoring efforts. Additional resources are dedicated to this effort both
for internal and external execution of the plan.
A key element to developing WSCPs for the City is close coordination and cooperation with
SFPUC, BAWSCA, and the Valley Water. It is critical to develop a coherent and coordinated
regional response to water shortages in order to provide a consistent message to customers.
Regional Interim Water Shortage Allocation Plan
Tier One Drought Allocations
In July 2009, as part of the WSA, the Wholesale Customers and San Francisco adopted a Water
Shortage Allocation Plan (WSAP) to allocate water from the regional water system to Retail and
Wholesale Customers during system-wide shortages of 20% or less (the “Tier One Plan”)65. The
Tier One Plan allows for voluntary transfers of shortage allocations between the SFPUC and any
Wholesale Customer and between Wholesale Customers themselves. In addition, water
“banked” by a Wholesale Customer, through reductions in usage greater than required, may
also be transferred.
65 The previous water shortage allocation plan expired in 2009 with the termination of the previous Water Supply
Agreement with the SFPUC. Details of the previous allocation plan are provided in the 2005 UWMP.
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In 2019, through an amendment to the WSA, the Tier I allocation formula was modified to
ensure that, in the event of a shortage, San Francisco Retail Customers will need to reduce
consumption by a minimum of 5%. Under the new formula, more water would be available to
Wholesale Customers like Palo Alto during a shortage than was available under the former
formula, and the amendment also provided that some of the water conserved by San Francisco
Retail Customers will remain in storage for use in subsequent dry years.
The Tier One Plan, which allocates water between San Francisco and the Wholesale Customers
collectively, distributes water based on the level of shortage as shown in Table 23:
Table 23: SFPUC and Wholesale Customer Share of Available Water
Level of System Wide Reduction in
Water Use Required
Share of Available Water
SFPUC Share Wholesale Customer Share
5% or less 35.5% 64.5%
6% through 10% 36.0% 64.0%
11% through 15% 37.0% 63.0%
16% through 20% 37.5% 62.5%
The Tier One Plan will expire at the end of the term of the WSA on June 30, 2034, unless
extended by San Francisco and the Wholesale Customers.
Tier Two Drought Allocations
In 2011, the Wholesale Customers negotiated and adopted the Tier Two Drought
Implementation Plan (Tier Two Plan), which allocates the collective Wholesale Customer share
among each of the 26 Wholesale Customers. This Tier Two Plan allocation is based on a
formula that takes into account multiple factors for each Wholesale Customer including:
• Individual Supply Guarantee;
• Seasonal use of all available water supplies; and
• Residential per capita use.
The water supplies made available from the SFPUC will be allocated to the individual Wholesale
Customers in proportion to each Wholesale Customer’s Allocation Basis, expressed in millions
of gallons per day (MGD), which in turn is the weighted average of two components. The first
component is the fixed Wholesale Customer’s Individual Supply Guarantee as stated in the
WSA. The second component is the Base/Seasonal Component, which is variable and is
calculated using each Wholesale Customers total monthly water use from all available water
supplies during the three consecutive years prior to the onset of the drought. The second
component is accorded twice the weight of the first component in calculating the Allocation
Basis. Minor adjustments to the Allocation Basis are then made to ensure a minimum cutback
level, a maximum cutback level, and a minimum level of supply to meet health and safety needs
for certain Wholesale Customers.
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Each Wholesale Customer’s Allocation Factor, which represents its percentage allocation of the
total available water supplies, is calculated from its proportionate share of the total of all
Wholesale Customers’ Allocation Bases. The final shortage allocation for each Wholesale
Customer is determined by multiplying the amount of water available to the wholesale
customers’ collectively under the Tier One Plan, by the Wholesale Customer’s Allocation Factor.
The Tier Two Plan requires that the Allocation Factors be calculated by BAWSCA each year in
preparation for a potential water shortage emergency. As the Wholesale Customers change
their water use characteristics (e.g., increases or decreases in SFPUC purchases and use of other
water sources, changes in monthly water use patterns, or changes in residential per capita
water use), the Allocation Factor for each Wholesale Customer will also change.
For long-term planning purposes, each Wholesale Customer has been provided with the Tier
Two Allocation Factors calculated by BAWSCA based upon the most recent normal year to
determine its share of available RWS supplies. However, actual allocations to each Wholesale
Customer during a future shortage event will be calculated in accordance with the Tier Two
plan at the onset of the shortage.
Water Shortage Mitigation Options
Water shortage mitigation options can be classified under two categories: Supply Side Options
and Demand Side Options. This section provides descriptions of many different actions and
activities that are possible in reaction to a water supply shortage situation. The City’s response
to drought-time shortages depends upon the severity of the shortage. Following this section,
specific actions are outlined for the various stages of a potential shortage.
Supply Side Options
The City’s options to increase its short-term water supply are limited. The City’s long-term supply
options are discussed in Section 3, “System Supplies.” The section below discusses short-term
alternatives to increase supply in the event of a water supply shortage.
City Wells
The status of the City’s emergency wells is discussed in the Groundwater area of Section 3,
“System Supplies.” During a drought period, it may be possible to use some water from the
wells to supplement the supply from the SFPUC, depending on the groundwater situation in the
Santa Clara Basin. Valley Water, the groundwater manager in Santa Clara County, may place
restrictions on that resource as well.
Recycled Water
During a drought or a short-term water emergency, recycled water would be available to the
City, however, a wide distribution of recycled water would require substantial infrastructure
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that would be difficult to construct in a short period of time. The City or private companies with
tanker trucks can obtain permits to utilize recycled water from the RWQCP. These companies
can pick up recycled water and deliver it to customers who will pay for this service. During the
summer of 2015, the City increased the use of water trucks to irrigate City trees on City-owned
medians and several private companies utilized recycled water to deliver water to private
citizens. Public awareness is enhanced by greater publicity of the availability of this alternative
to customers. Trucking recycled water may displace about 1% of potable water demand.
Recycled water is available except in a catastrophic disaster (severe earthquake) that severs all
sources of water (SFPUC, wells and storage) to the system thereby eliminating the source of
water to the RWQCP. However, in the event of a severe earthquake the delivery of recycled
water will be a low priority.
Water Purchases from Other Suppliers
The City could conceivably purchase water from a new supplier in an extreme water supply
shortage situation. However, any such purchase would have to be consistent with the
requirements specified in the WSA 66 and be coordinated with all other jurisdictions between
the source and the City to ensure the supply meets deliverability requirements. The SFPUC has
made such purchases of water from various suppliers in times of water shortages. The City and
all other BAWSCA member agencies have received this water through the SFPUC delivery
systems. It is unlikely that the City could negotiate a better deal than the SFPUC or BAWSCA in
these extremely complicated short-term arrangements, and therefore it is unlikely that the City
would seek to purchase water on its own.
The City is a participant in several regional efforts to evaluate and develop new supply sources,
including purchasing water from other sources. Additionally, the effluent transfer agreement
with Valley Water and the City of Mountain View enables the City to request Valley Water to
develop and offer water supplies to Palo Alto at cost.
The SFPUC system has several interties with adjacent water agencies, including EBMUD and the
Valley Water. These interties could be used to “wheel” water that is purchased from other
sources or agencies.
Demand Side Options
In droughts, the City expects to achieve significant amounts of demand reduction through its
use of DMMs, as that term is used in the California Water Code. (See, for example, §§ 371,
10631.) These options include a combination of information outreach programs, drought rate
schedules, demand side programs and water use restrictions.
Defining Water Features
The City owns and operates several un-metered water features including two recirculating
fountains and one recreational water feature. A small number of commercial customers have
66 WSA, Section 3.12
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recirculating fountains. The City’s Water Use Restrictions ordinance prohibits non-recirculating
fountains. The City is not aware of any non-recirculating, privately-owned water features.
Baronda Lake, which uses about 250 AF over the 5 month period from mid-May through mid-
October, is used for recreation and education and is habitat for several species of fish, other
aquatic life and birds. The lake is also a water source for many different types of mammals.
Demand Side Management Programs:
Demand side management programs can be offered using many different program design
options and delivery mechanisms. Some examples are listed below.
Home Water Use Reports
Home Water Reports will be used to encourage customers to save water. The Home Water
Report compares a household’s water usage to neighbors with similar lot sizes, landscape area,
and family demographics. The reports rank a household for how water efficient it is compared
to homes with similar demographics, in an attempt to encourage more water efficient
behaviors and participation in conservation programs.
Information Outreach Programs
Customers will be provided with information on ways to achieve needed water use reductions.
The City will communicate to the customers how best to prioritize their water use needs and
how to implement alternative ways to receive the same level of service while using less water.
Information and public outreach programs include utility bill inserts, information on CPAU’s
website, local print media campaigns, a social media presence, commercial targeted mailings,
workshops and demonstrations, fact sheets on conservation technologies and practices, and
coordination with product manufacturers and suppliers.
Incentive-based Demand Side Management Programs
In a persistent water shortage or required water use reduction, most customers will take the
quick and easy actions first. More complex and expensive incentive programs to provide
demand side management may be needed to achieve additional results. Although incentive
programs require time to develop and promote, significant water savings can be achieved.
Depending upon market saturation, some programs such as delivery of relatively inexpensive
hardware (e.g. low-flow faucet aerators and showerheads) and services such as leak detection
and irrigation system audits can offer quick drought-time savings. Other programs may include
a toilet rebate program or incentives to replace high water use landscapes with water efficient
landscape designs and installation of efficient irrigation hardware.
Customer Water Use Audit Programs
Water audits are provided as an informational service to customers and typically include an
individualized, one-on-one analysis and site-specific recommendations for both indoor and
outdoor water efficiency improvements. Audits can be enhanced by the delivery of relevant,
action-oriented information the customer can use to change behavioral practices or participate
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in additional audit or rebate programs. In a water emergency or shortage, additional staff may
be needed to provide water audits, rebate program administration, and outreach assistance to
residential and commercial customers.
Drought Rate Schedules
Pricing is one of the most powerful tools that a utility can use to promote its conservation
goals. The overarching criteria for constitutionally compliant water rate structures—for use in
droughts or not—is that all rates must be based on the cost to serve customers. Both tiered
water rates and volumetric-based rates can provide an incentive to conserve. CPAU has had
tiered water rates for some time, and the bulk of water revenues are from volumetric rates and
not the fixed monthly meter charge. This rate design encourages efficient use of water
whether in a drought or not. However, when water use declines in droughts, revenue recovery
may become a problem.
In September 2015, drought surcharges were developed so that, upon Council action,
additional charges could be applied to ensure the financial health of the Water Fund. The
drought surcharges were imposed effective September 1, 2015 to recover (via a tiered
volumetric charge) the cost of operating the distribution system. The drought surcharge may
be re-instated in response to future water supply shortages.
Other Potential Rate Schedules and Structures
Customer Class Targets
In many water shortage situations, no rationing of water is required – ample communication of
the water shortage coupled with drought surcharges, if needed, have been sufficient to meet
the City’s water reduction targets in the prior and current drought. If rationing of water is
required to meet a water reduction requirement in a drought, customer class targets should
mirror the required indoor/outdoor water reduction goals that may be established during a
drought. Whether there will be different rate schedules (consistent with the cost of service
requirement) for each customer class will be determined by: (a) the severity of the water
shortage, and (b) the capabilities and limitations of the utility billing system. Experience has
shown that separating the single- family residential customers—which are more homogeneous
than any other customer group—from all other customer groups is generally the only
distinction needed.
Allocation Methods
Any allocation plan would take into consideration the criteria listed in Appendix G. These criteria
will be a guide to selecting the most efficient and effective water use reduction method under
the particular circumstances of a specific drought situation.
1. Allocations Based on Percentage of Past Use
Plans that base a customer’s allocation on a percentage of past use are sometimes perceived as
fair and easy to administer. However, these plans have three significant shortcomings. First,
selection of a base year is problematic. It is difficult to pick a base year unaffected by shortage
year programs on the one hand, or gradually increasing water use after a drought (the
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“rebound effect”) on the other. The second problem is that each year the turnover of new
accounts is approximately 20 to 30% (mostly multi-family residents). In addition, many
businesses have changed their practices to some extent over the years. Therefore to use this
plan in 2020 and beyond would mean that a large percentage of water customers would have
an allocation based on a previous occupant’s usage, a previous operation, or some alternative
situation. 2020 poses the additional challenge of the shelter-in-place impacts on residential and
commercial water use. Handling the large volume of such cases can create administrative
difficulties and perceptions of inequities as revised or new allocations are assigned to these
customers. The third major flaw in the “percent of past use” concept is that, regardless of base
year selected, historically conservation-minded customers may feel penalized for their past
efforts while profligate users may have too large an allocation.
2. Equal Allocation for Each Home (for single-family residential)
This plan would set an identical allocation for each home designed to meet the target reduction
for the class. The first tier in the rate structure 67 would be set at this target amount. The second
tier would be a “buffer” tier designed to accommodate seasonal water needs. The third and last
tier would be a penalty rate block price considerably higher than the first two tiers.
All homes would be treated the same under this plan. In addition, it would be inexpensive to
administer and easy to understand and implement. However, it could be perceived as unfair by
relatively large families or customers with large lots.
Under this plan, hardship exemptions would be limited to those who require more water for
health or safety reasons. No additional allowances would be provided for the number of
persons living in the household or the landscaping requirements of the particular size lot.
Enforcement of this plan would involve installing a flow restrictor on those customers who
continue to exceed the allocation beyond a two-month period.
3. Complete Per Capita Allocation Plan (for single-family residential)
Under this plan each person would be allocated a certain amount of water per month. In
addition, each household would be allotted a certain amount of water per month for other
essential needs, including a base minimum amount for outdoor watering of shrubs and trees.
Per capita information would be based on information supplied by the customers through a
special mailing. The strength of this plan is that it would probably be more acceptable to the
community than the equal allocation per household plan because it takes into account the
relationship between water usage and the number of persons living in a household. Its
weaknesses are the inability of the current Utilities billing system to record or manage “per
capita” data and verification of per capita information. This method is consistent with the
state’s Making Conservation a California Way of Life Principles.
67 Any rate design must be consistent with “cost of service” principles embedded within the California constitution.
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4. Default Per Capita Allocation Plan (for single-family residential)
Under this plan each household would receive an allocation sufficient for families of a default
size. For households over that size, an additional amount would be allocated per month for the
number of people over the default size. This plan is easier to administer than a complete per
capita plan since the number of data entries is significantly reduced. The plan’s weakness is its
lack of detail or fine-tuning for households under the default size, which may be perceived as
unfair by larger households.
Mandatory Water Rationing Plans Applicable to Multi-Family Accounts, Business, and City
Departments
Due to the differences between customer classes, it is difficult to construct rationing plans that
meet all the criteria listed in Appendix G. During the 1987-1993 drought period, the City
introduced Baseline Consumption Allowances (BCAs) for all customer classes except single-
family residential accounts. This includes multi-family residential, commercial, industrial,
institutional, and city facilities accounts. The BCA was intended to represent the indoor
consumption of each customer.
It is important for any allocation plan to take into account the specific needs of these customer
classes because of their diversity and unique requirements. The BCA does this. Rate structures
using the BCAs can be constructed as appropriate to meet the reduction targets required and to
provide the economic incentive necessary to prompt customer action. And, the targets and the
associated rate block prices could be changed as the reduction requirement changes.
Weaknesses of this method are that it may not accurately represent indoor water use. For
example, exemptions would have to be considered for customers with cooling towers, since
lack of water for cooling towers would effectively end the customers’ ability to cool their
building interiors, resulting in possible health and safety impacts of employees. Another
alternative in extreme cases (Stage 3 or higher) could be an allocation per fixture plus a cooling
tower credit, which is similar to the per capita method for residences.
Excessive Use Penalties for All Allocation Methods
Penalties for excessive use are expected to vary according to the customer class. For single-
family residential customers exceeding percent-of-past-use, equal-allocation-per-home, or per
capita water use, the penalty could be installation of a flow restrictor when usage continued to
exceed the allocation beyond a 2-month period. Enforcement of this penalty would only occur
after customers were notified and any reasonable appeals had been processed.
For customers under a BCA (all classes except single family residential), the primary penalty is in
the rate structure itself.
Water Use Prohibitions, Mandatory Restrictions
Adopting water use restrictions is another way to manage how customers use a limited
resource. Restrictions can be classified as those preventing water waste, those “setting a tone”,
and those that prohibit low priority use in times of severe shortages.
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In the case of a system-wide water shortage, close coordination with SFPUC is necessary. One
of the considerations for selecting which water use restriction ordinances to adopt is what the
City’s suppliers recommend for the region. Both the SFPUC and Valley Water provide
recommendations, and the City will attempt to follow those recommendations so that regional
consistency is achieved.
The City’s ability to enforce restrictions is also a critical variable in the selection of water use
regulations. For restrictions to be credible and obeyed they must be enforceable and enforced.
Therefore certain restrictions, such as limits on indoor uses such as showering, are not
practical.
Water use restrictions are achieved by using the methods, prohibitions and penalties described
in the sections below. Appendix H lists permanent water use restrictions that the City currently
has in place and those that may be adopted on an emergency basis in times of state-mandated
reductions or water shortage 68.
68 Section 12.32.015 of the Palo Alto Municipal Code, pertaining to emergency water use regulations, previously
codified and containing portions of Ordinance Nos. 3960, 3984 and 4038, was suspended, but specifically not
repealed, by Ordinance No. 4150, § 2. In pertinent part, Section 2 of Ordinance No. 4150 states that Section
12.32.015 is "suspended until such time as water shortage emergency conditions shall be subsequently found,
determined, and declared by the Council to exist."
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Water Shortage Contingency Plan Stages of Action
Actions to be taken in response to a water shortage or state-mandated reduction depend on
the severity of the shortage or the magnitude of the required reduction. The staged responses
(Stage I to Stage IV) depend to some extent upon the local conditions and the length of time
that customers have had to focus their attention on the water shortage. For each stage noted
below, activity levels in several key areas are described. Appendix H, the Water Shortage
Contingency Plan, details the planned water use restrictions for each reduction level. Reduction
targets will be based on the most recent non-drought year. If a different base year were to be
selected, the programs might require modification. In all stages, action will be taken to ensure
City facility water use is reduced by the appropriate amount.
Some factors which influence the effectiveness of any water management plan include: (1) the
customer’s behavior and perception of the need to conserve; (2) weather; (3) the duration of
the shortage or mandate; (4) the customer’s economic situation; (5) the extent to which the
City achieves its utility revenue targets; (6) the percentage of exemptions or variances granted;
(7) the role of the media; and (8) the customer’s acceptance of the need for water use
reduction.
Because each water shortage situation is unique in duration, in breadth and in involvement by
the state, there is a need for some flexibility in selecting the exact response strategy. Even with
the same reduction target, the strategy in the first year of a drought may be different than that
recommended for an additional year of a long running drought. It is very important early in a
drought period to develop outreach messages and policy directions using a longer-term
perspective. In this way, communications with customers throughout the drought period will be
consistent and appropriate.
STAGE I – Minimum Water Supply Shortage: Up to 10% target water savings
The SFPUC requested voluntary reductions in this range in 1987, 2009, 2014, and 2016 which
the City was able to achieve.
Information Outreach and Audit Programs
The City provides ongoing informational outreach and audit programs. At this water shortage
stage, the focus of these programs would be on water saving information. A low level media
information campaign would begin with the emphasis on reducing waste. As water
consumption is monitored, the level of emphasis would be adjusted in order to meet the
reduction goal.
The City has permanent ordinances in place that prohibit the waste of water. These ordinances
are sufficient for this stage of water shortage. Enforcement would be on an “as reported” basis
and mostly via reminder notices.
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Incentive-based Demand Side Management Programs
Programs designed to assist customers in demand side management would be continued and
augmented, to the extent necessary to provide the savings required. These programs may
include rebate programs for indoor fixtures or incentives to remove lawn turf for less water-
thirsty landscaping or to install advanced irrigation controllers. The City would continue to
monitor programs being developed by other utilities in order to take advantage of regional
momentum and shorten internal development time.
Drought Rate Structures
No special drought rate structure is needed at this water shortage stage. The City’s standard
single-family rate structure already encourages conservation by having a relatively small fixed
charge and tiered rates.
STAGE II – Moderate Water Supply Shortage: 10% to 20% target water savings
The City was able to achieve this level of water reduction (19.1%) when rationing was imposed
by the SFPUC in FY 1989. The program used at that time is similar to the one outlined below.
Information Outreach and Audit Programs
The frequency of advertising and events comprising the information campaign would be
increased. Water kits with low-cost conservation devices will be available to customers.
Incentive-based Demand Side Management Programs
Programs designed to assist customers in demand side management would be continued and
augmented to the extent necessary to provide the savings required. These programs may
include incentives for replacing high water using fixtures such as toilets, clothes washers, and
irrigation devices, as well as incentives to retrofit landscapes for a low water use, drought
tolerant design. The City would continue to monitor programs being developed by other
utilities in order to take advantage of regional momentum and shorten internal development
time.
Drought Rate Structures
In response to water shortage conditions in the 1987-1992 drought, the City established
separate drought rate schedules for single-family residential and all other customers and
increased the price difference between lower and higher consumption tiers. For all customers
except single- family residential customers, the consumption tiers were based on a Baseline
Consumption Allowance (BCA) concept. This concept is described in the section, Water
Shortage Mitigation Options, as applicable to multi-family, commercial, industrial, public
facilities and City facilities accounts.
Water Use Restrictions
The City would actively enforce the water use restrictions with an emphasis on education. A
system of warnings leading to possible fines and installation of a flow restrictor would be
followed. During the summer of 2015, the City developed a mobile application (311) for
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members of the community to report wasted water. This technology allowed for much wider
enforcement by City staff. A small number of emergency water use restrictions would be
added.
Drought Rate Structures
Drought surcharges may be imposed.
If reduction goals were not being met, reduction targets may need to be developed for each
customer class. Potential strategies for allocation plans are discussed above.
The exact rates and rate structures would be established upon receipt of information regarding
both the reduction requirement and applicable penalties and based on the utility’s overall
revenue requirements.
STAGE III – Severe Water Supply Shortage: 20% to 30% target water savings
The state-mandated water use reduction for Palo Alto in 2015/2016 was 24% which the City
exceeded. The program outlined below was implemented to achieve those results. The water
use restrictions for this stage have been modified slightly to accommodate the increase in the
number of stages in the proposed 2020 WSCP.
Information Outreach and Audit Programs
All activities from Stage II would continue at escalated levels. In addition, emphasis would be
put on targeted outreach to high water users and special categories of water users (e.g., car
washes, restaurants, etc.).
Incentive-based Demand Side Management Programs
Existing demand side management programs would be continued. Staff would continue to
closely monitor overall water savings in order to determine if additional levels of rebate
amounts would provide additional savings, or whether other programs would be necessary.
Drought Rate Structures
Drought surcharges may be imposed.
If reduction goals were not being met, reduction targets may need to be developed for each
customer class. Potential strategies for allocation plans are discussed above.
The exact rates and rate structures would be established upon receipt of information regarding
both the reduction requirement and applicable penalties and based on the utility’s overall
revenue requirements.
Water Use Restrictions
Additional “emergency” water use restrictions would be added to the existing permanent
restrictions including restrictions of the number of days per week irrigation is permitted.
Alternative Irrigation Plans will be established for golf courses, parks, and schools with specific
water use reduction targets.
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The amount of staff time dedicated to enforcement would be increased with an emphasis on
education.
STAGE IV – Severe to Critical Water Supply Shortage: 30% to 40% target water savings
The City achieved usage reductions of 31.5%, 35.4%, and 32.7% in FY 1991, FY 1992, FY 1993
respectively, in response to SFPUC water rationing. In response to the state-mandated water
use reductions in 2015/2016, the City achieved a 31% water use reduction. The program
outlined below was implemented to achieve those results. The water use restrictions for this
stage have been modified slightly to accommodate the increase in the number of stages in the
proposed 2020 WSCP.
Information Outreach and Audit Programs
All activities from Stage III would continue at escalated levels. In addition, emphasis would be
put on targeted outreach to high water users and special categories of water users (e.g., car
washes, restaurants, etc.).
Incentive-based Demand Side Management Programs
Existing demand side management programs would be continued. Staff would continue to
closely monitor overall water savings in order to determine if additional levels of rebate
amounts would provide additional savings, or whether other programs would be necessary.
Drought Rate Structures
To achieve these reduction goals in past droughts, rationing was not implemented. Instead,
along with an extensive information outreach effort, drought surcharges may be imposed.
The exact rates and rate structures would be established upon receipt of information regarding
both the reduction requirement and applicable penalties and based on the utility’s overall
revenue requirements.
Water Use Restrictions
Additional “emergency” water use restrictions would be added to the existing permanent
restrictions including further restrictions on the number of days per week irrigation is
permitted. Alternative Irrigation Plans will be established for gold courses, parks, and schools
with specific water use reduction targets.
The amount of staff time dedicated to enforcement would be increased with an increase in
levying fines.
STAGE V – Critical Water Supply Shortage: 40% to 50% target water savings
A program to meet this level of water use reduction has not yet been implemented in the City.
However, in the spring of 1991, the SFPUC adopted a program calling for reductions in this
range. Although ultimately replaced with a less restrictive program, the City discussed what
108
actions would be taken to meet the critical reduction targets. The program below outlines the
major components of the plan to meet such a target.
Information Outreach and Audit Programs
All activities from Stage IV would continue at further escalated levels. A greater focus will be
placed on survival strategies and prioritization assistance for all customer classes.
Incentive-based Demand Side Management Programs
Depending on what programs have been implemented prior to this stage, or current market
saturations for certain devices, a selected number of indoor conservation incentives will be
offered. These may include rebates for and/or free distribution of showerheads and faucet
aerators, toilet modifications or retrofits, process water use modifications and use of recycled
water.
Drought Rate Structures
At this level of reduction, an allocation method would be considered for each customer. The
allocations would be sufficient for the most critical, high priority uses of water and the
availability of water for outside use would be dramatically reduced. Various allocation methods
are discussed in the previous section, Allocation Methods.
Water Use Restrictions
Severe “emergency” water use restrictions, many of which will supersede less stringent
restrictions imposed in a less critical phase, will be added. Enforcement will be more rigorous in
terms of hours of enforcement, number of staff involved, and the speed with which penalties
are applied.
STAGE VI – Water Emergency: Greater than 50% target water savings
A program to meet this level of water use reduction will have major economic and aesthetic
impacts on the City. Water use will be restricted to health and safety needs, possibly with some
allocation for the tree canopy maintenance.
Information Outreach and Audit Programs
All activities from Stage V would continue at further escalated levels. A greater focus will be
placed on survival strategies and prioritization assistance for all customer classes.
Incentive-based Demand Side Management Programs
Depending on what programs have been implemented prior to this stage, or current market
saturations for certain devices, a selected number of indoor conservation incentives will be
offered. These may include rebates for and/or free distribution of showerheads and faucet
aerators, toilet modifications or retrofits, process water use modifications and use of recycled
water.
109
Drought Rate Structures
At this level of reduction, an allotment method would be considered for each customer. The
allocations would be sufficient for health and safety and the availability of water for outside use
would be eliminated with some exception for keeping the tree canopy alive. Various allotment
methods are discussed in the previous section, Allocation Methods.
Water Use Restrictions
Severe “emergency” water use restrictions, many of which will supersede less stringent
restrictions imposed in a less critical phase, will be added. Enforcement will be at the highest
possible level terms of hours of enforcement, number of staff involved, and the speed with
which penalties are applied.
Table 24 summarizes the WSCP.
110
Table 24: WSCP Summary
Stage I Stage II Stage III Stage IV Stage V Stage VI
Target Water
Savings
Up to 10%
10% -20%
20% -30%
30% - 40%
40%- 50%
Above 50%
Information
Outreach
and Audit
Program
Low level
outreach
Increase advertising, social media
campaigns and direct communication with
customers targeting highest users and
increasing water use auditing
Escalate
outreach
efforts and
media
campaign
with focus on
water use
prioritization
Highest
outreach
effort level
with focus
on health
and safety
Demand‐Side
Management
Programs
Continuation
of existing
programs,
evaluation of
new programs
Augment programs and incentive levels as necessary to achieve
reduction targets
Rate
Structures
Standard
rates already
encourage
conservation
Drought rate structures may be
implemented to secure needed revenue
Water allocations or
allotments may be
implemented
Water Use
Restrictions
Only
permanent
water use
ordinance –
no new
restrictions
apply
Water use restrictions become more severe with each stage and
enforcement is enacted more strongly with each stage. With each stage,
efforts made to ensure tree canopy is protected as much as possible.
Recycled
Water Use
Business as
usual use
Water use restrictions require use of recycled water for specific
purposes, advertise availability of recycled water for trucked delivery,
use recycled water for City facilities and street trees as much as
possible.
Alternative Water Supplies During a Water Shortage
Recycled Water Use
Recycled water offers an alternative source of water to those customers with valuable
landscaping. The availability of contractors who can haul recycled water will be advertised. In
addition, the City may rent tanker trucks to irrigate valuable City landscaping and street trees
that will undoubtedly be stressed by a long-term drought, the likely precursor to this stage of a
water shortage. The City used trucked recycled water in this manner during the recent drought.
Some customers have continued to use local contractors to irrigate with recycled water.
111
Groundwater
The City’s eight emergency groundwater wells are permitted for an annual production of 1,500
AFY. Staff will evaluate required wellhead treatment modifications needed to safely blend
groundwater with SFPUC water and will potentially update the WSCP incorporating
groundwater as an additional supply during severe droughts or water emergencies. The volume
of groundwater available may be subject to pumping restrictions determined by Valley Water,
the Groundwater Manager in Santa Clara County. In the event of a severe water supply
shortage, Valley Water will work with stakeholders to determine the best use for groundwater
resources.
Revenue and Expenditure Impacts and Measures to Overcome Impacts
Law
10632.(a) Every urban water supplier shall prepare and adopt a water shortage contingency plan
as part of its urban water management plan…
(8) A description of the financial consequences of, and responses for, drought conditions,
including, but not limited to, all of the following:
(A) A description of potential revenue reductions and expense increases associated with
activated shortage response actions…
(B) A description of mitigation actions needed to address revenue reductions and expense
increases associated with activated shortage response actions...
(C) A description of the cost of compliance…
Revenue Reductions, Expense Increases, and Cost of Compliance
Water utility expenditures can be generally categorized as fixed or variable expenses. The
variable costs are almost entirely related to the costs of purchasing water supplies. Although
the SFPUC supply costs are expressed as a variable commodity rate, the SFPUC system, like
many water delivery systems, is almost exclusively a fixed cost conveyance and treatment
system. Therefore, during a water supply shortage, the City’s cost of purchasing water from the
SFPUC may go down in the short-term, but SFPUC rates will be raised to make up for the
revenue shortfall in the long-term.
As a retail provider, the City’s fixed costs primarily relate to the cost of operating and
maintaining the City’s distribution system. Due to the City’s volumetric rate structure, the
decline in sales revenue will exceed the decline in expenses. For each stage in the WSCP and
assuming 2020 rate schedules, the revenue shortfall, net of the decline in expenses and based
on FY 2020 costs and revenues, is anticipated to be:
Stage 1: Up to 10% target water savings results in $1.9 million shortfall
Stage 2: 10% - 20% target water savings results in $3.8 million shortfall
Stage 3: 20% - 30% target water savings results in $5.6 million shortfall
Stage 4: 30% - 40% target water savings results in $9.9 million shortfall
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Stage 5: 40% - 50% target water savings results in $13.3 million shortfall
Stage 6: Greater than 50% target water savings results in greater than $13.3 million
shortfall
Implementation cost for the informational outreach programs, monitoring, and reporting
during a water shortage increases during periods of voluntary and mandatory water use
reductions. The 2015 state-mandated potable water use reductions cost the City an estimated
$400,000. Estimates for those costs are $30,000 to $50,000 per year for voluntary programs.
For mandatory programs, estimated costs are $400,000 to $600,000.
Excessive use penalties may be associated with certain drought rate structures described
above. Additional staff resources would be needed to monitor customer use and install flow
restrictors on excessive water users.
The SFPUC includes a variable component to water rates for most customer classes. As a
result, as sales decrease, revenues are lost on a per unit basis. Because the marginal cost of
water production is relatively small, as production is reduced, the cost of service remains the
same. For both Retail and Wholesale Customers, a reduction in water purchases – whether
voluntary or mandated – would require the SFPUC to raise rates, cut costs, or use existing
fund balance reserves to cover its expenses. The financial planning and rate-setting process is
complex and iterative. While major impacts of a water shortage on rates are described below,
the full process, especially for large water shortages, would incorporate significant
stakeholder discussion about tradeoffs and financial impacts.
The SFPUC’s current retail water rates have a provision for a “drought surcharge” that
automatically increases adopted rates in the event of a declared water shortage. The drought
surcharge is calculated so that, accounting for the expected reduction in retail water usage,
total revenues are equal to what they would have been without the reduction. The drought
surcharge protects the SFPUC’s financial stability during water shortages, and provides
customers an incentive to meet conservation targets.
For Wholesale Customers, the rate-setting process is governed by the terms of the WSA,
which provides that, in the event of a water shortage emergency, the SFPUC may adjust
wholesale rates in an expedited way concurrently with the imposition of drought surcharges
on Retail Customers. Beyond drought rate setting and emergency rate setting, rates are set
annually in coordination with the SFPUC annual budget process and are based on the
forecasted wholesale share of regional water system expenditures and total purchases. If
Wholesale Customer usage is expected to decrease – either voluntarily, or due to shortages
– this would be incorporated into the wholesale rate forecast, and rates may increase.
Mitigation Actions
From a utility perspective, there is a downside to water conservation: the erosion of sales
revenue. As consumers reduce their usage in response to the drought, the utility will
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experience a decline in sales. Both the magnitude of the water use reduction and the duration
of such reductions will influence which mitigation measures are needed.
An approach for short-term revenue shortfalls caused by decreased revenue and increased
expenses is to draw upon the utility’s cash reserves, if they are sufficient, to cover the financial
obligations of the utility. Other options include short-term borrowing, financing long-term
capital projects through revenue bonds rather than through current rates, or the
implementation of drought surcharges to address the loss in sales revenue. Each of these
approaches has its advantages and disadvantages. The appropriate response will depend upon
the specific circumstances facing the utility.
Monitoring Customer Compliance and Reporting
Law
10632. (a) The plan shall provide an urban water shortage contingency analysis that includes each
of the following elements that are within the authority of the urban water supplier:
(9) For an urban retail water supplier, monitoring and reporting requirements and procedures
that ensure appropriate data is collected, tracked, and analyzed for purposes of monitoring
customer compliance and to meet state reporting requirements.
Under normal water supply conditions, the amount of water coming into the City from the
SFPUC regional supply line is metered at the Arastradero, California, Page Mill, Sand Hill and
Lytton turnouts. The daily meter readings are maintained at the Utility Control Center. Totals
are reported monthly to CPAU for comparison to the billing amounts from the SFPUC.
In water shortage periods, the mechanism for determining actual reductions in water use
remains largely the same. The Director of Utilities would form an ad hoc Water Committee
with representatives of all divisions to oversee outreach and monitoring efforts. During
curtailment stages in a water shortage, supply figures are reported a daily basis. The Water
Committee would provide timely reports to the City Council on the shortage and success of
measures taken. Such a committee was formed during the 2015-2016 drought.
If curtailment reaches Stage III or higher, daily supply figures are reported to the Director of
Utilities and the Water Committee. The Water Committee would report monthly to City Council
or as frequently as information is requested by the City Council.
If Alternative Irrigation Plans are put in place for golf courses, schools, and parks, usage reports
will be generated at the close of each monthly billing cycle to monitor compliance. The City will
work closely with those customers through the Utilities Key Account Customer Representatives,
to ensure compliance and collaborate on any operational adjustments needed to achieve the
targeted reductions.
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Water Shortage Contingency Legal Authority
Law
10632. (a) The plan shall provide an urban water shortage contingency analysis that includes each
of the following elements that are within the authority of the urban water supplier:
(7) (A) A description of the legal authorities that empower the urban water supplier to
implement and enforce its shortage response actions... that may include, but are not limited to,
statutory authorities, ordinances, resolutions, and contract provisions.
(B) A statement that an urban water supplier shall declare a water shortage…
(C) A statement that an urban water supplier shall coordinate with any city or county within
which it provides water supply services for the possible proclamation of a local emergency, as
defined in Section 8558 of the Government Code.
The City has experienced four instances of water shortage due to drought in the last 35 years. A
shorter duration drought occurred in l976-77, a water supply deficit occurred between l987 and
l993, and 2015-2016 brought unprecedented state-mandated reductions.
Under Water Code Section 350, the Council may declare a water shortage emergency condition
to prevail within the City’s service territory, whenever it finds and determines that the ordinary
demands and requirements of water consumers cannot be satisfied without depleting the
water supply of the distributor to the extent that there would be insufficient water for human
consumption, sanitation, and fire protection. The City will declare a water shortage if the SFPUC
or the state declares a water shortage. The City will coordinate such a declaration with Valley
Water and Santa Clara County.
Appendix F provides a draft model ordinance that could be implemented during a water
shortage emergency.
Reevaluation and Improvement of Procedures
Law
10632. (a) The plan shall provide an urban water shortage contingency analysis that includes each
of the following elements that are within the authority of the urban water supplier:
(10) Reevaluation and improvement procedures for systematically monitoring and evaluating
the functionality of the water shortage contingency plan in order to ensure shortage risk
tolerance is adequate and appropriate water shortage mitigation strategies are implemented as
needed.
At the end of each water shortage period, the City will conduct a review and evaluation of
savings achieved, expenditures, revenue losses and other impacts on the water customers and
on the City as a whole. Adjustments to the WSCP will be proposed and recommended for
Council approval as needed.
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Section 8 – Supply and Demand Comparison Provisions
Law
10635.
(a) Every urban water supplier shall include, as part of its urban water management plan, an
assessment of the reliability of its water service to its customers during normal, dry, and multiple
dry water years. This water supply and demand assessment shall compare the total water supply
sources available to the water supplier with the long-term total projected water use over the
next 20 years, in five-year increments, for a normal water year, a single dry water year, and a
drought lasting five consecutive water years. The water service reliability assessment shall be
based upon the information compiled pursuant to Section 10631, including available data from
state, regional, or local agency population projections within the service area of the urban water
supplier.
(b) Every urban water supplier shall include, as part of its urban water management plan, a
drought risk assessment for its water service to its customers as part of information considered
in developing the demand management measures and water supply projects and programs to be
included in the urban water management plan. The drought risk assessment shall include each of
the following:
(1) A description of the data, methodology, and basis for one or more supply shortage conditions
that are necessary to conduct a drought risk assessment for a drought period that lasts five
consecutive water years, starting from the year following when the assessment is conducted.
(2) A determination of the reliability of each source of supply under a variety of water shortage
conditions. This may include a determination that a particular source of water supply is fully
reliable under most, if not all, conditions.
(3) A comparison of the total water supply sources available to the water supplier with the total
projected water use for the drought period.
(4) Considerations of the historical drought hydrology, plausible changes on projected supplies
and demands under climate change conditions, anticipated regulatory changes, and other locally
applicable criteria.
Supply and Demand Comparison
Normal Year Supply and Demand
Since the City’s primary water supply is from the SFPUC, it is useful to examine the supply-
demand comparison for the entire SFPUC system. SFPUC, in their 2020 UWMP, provides more
detail regarding available water supply for normal and drought scenarios.
Table 25 illustrates total system deliveries for both the Retail and Wholesale SFPUC customers.
Table 25 indicates that during normal precipitation years, the SFPUC has adequate supplies to
meet its contractual obligation to the Wholesale Customers of 184 MGD or 206.243 AFY.
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Table 25: SFPUC System Supply and Wholesale Customer Supply and Demand (AFY)69
The City has an ISG of 16.575 MGD (or 18,579 AFY) and projects demands will remain below the
City’s ISG through the 2020 UWMP planning horizon. Table 26 represents the City’s Supply and
Demand balance for the 2020 planning horizon based on the City’s contractual entitlement with
the SFPUC and normal precipitation.
Table 26: City of Palo Alto Supply/Demand Balance (AFY)
As previously discussed, SFPUC’s WSIP is nearly complete. For this 2020 UWMP, the WSIP-
related water supply sources assumed to be available are summarized in Table 27.
69 Letter from Paula Kehoe, SFPUC Director of Water Resources, to Danielle McPherson, BAWSCA, dated March 31,
2021.
Year 2020 2025 2030 2035 2040 2045
RWS Supply
(AFY)222,608 238,973 241,439 247,155 254,217 265,090
Wholesale
Supply
(AFY)148,069 163,649 165,779 170,263 175,195 182,480
Wholesale
Demand
(AFY)148,069 163,649 165,779 170,263 175,195 182,480
2020 2025 2030 2035 2040 2045
Palo Alto Demand for SFPUC
Water 10,921 11,287 11,394 11,546 11,801 12,113
Individual Supply Guarantee 18,579 18,579 18,579 18,579 18,579 18,579
Difference 7,658 7,292 7,185 7,033 6,778 6,466
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Table 27: SFPUC Water Supply Improvement Program Project Assumptions
Dry Year Scenarios
Palo Alto’s recycled water supply is 100% reliable to meet the City’s demand for non-potable
water. The dry-year analysis that follows pertains only to potable water purchased from the
SFPUC.
For water shortages up to 20%, the Tier One water shortage plan will be applied. The formula
included in the Tier One plan indicates that the cutback for the City will be similar to the
system-wide cutback, but less than the average BAWSCA cutback. The Tier One plan does not
apply to system-wide shortages greater than 20%. Implementing water use reduction greater
than 20% requires the SFPUC to meet and discuss with Wholesale Customers a strategy for
meeting incremental reductions above the Tier One plan. The SFPUC has the authority to make
final allocation decision for the portion above 20%, though the Wholesale Customers have the
contractual right to challenge the proposed approach.70 This analysis assumes the relative split
of available water between SFPUC Retail and Wholesale Customers will be the same for
shortages greater than 20% as shortages of 20%.
This analysis assumes full implementation of the Bay Delta Plan in 2023. Should a voluntary
settlement agreement be reached and adopted, the impacts on water supply availability will be
lessened. The following assumptions regarding the SFPUC’s WSIP apply to all normal and dry
year water availability forecasts.
70 WSA, Section 3.11 (c )(3)
118
Table 28: SFPUC WSIP Project Assumptions
Under the condition of multiple dry years in a row and assuming implementation of the Bay
Delta Plan in 2023 using a base year of 2025, available supply is greatly reduced as shown in
Table 29Tabl. The analysis assumes projected Wholesale Customer demand. SFPUC will provide
an appendix to their 2020 UWMP showing supply availability projections using the 184 MGD
Supply Assurance.
Table 29: Projected Multiple Dry Years Wholesale Supply from RWS, Bay Delta Plan in 2023
The potable water supply shortfall for Palo Alto from a single dry year and for multiple dry years
is shown below in Table 30 and Table 31. Under these conditions, Palo Altans will be asked to
reduce water usage by approximately 35%.
Table 30: Single Dry Year Potable Water Supply Shortfall for Palo Alto
2020 2025 and Beyond
Calaveras Dam
Replacement Project
Calaveras Reservoir
partially refilled at spring
2020 level of 63,900 AF
Calaveras Reservoir
fully refilled
Lower Crystal Springs
Dam Improvements
Regional Groundwater
Storage and Recovery
(GSR) Project
GSR account partially
filled at spring 2020 level
of 23,500 AF; GSR
recovery rate of 6.2 mgd
GSR account fully
filled; GSR recovery
rate of 6.2 mgd
Alameda Creek Recapture
Project Project not built Project built
Dry-year Transfers Not in effect
Crystal Springs storage not restored
AFY 2025 2030 2035 2040 2045
Firs t Year 104,579 105,588 108,166 111,192 99,423
Second Year 89,671 90,568 92,697 95,387 99,423
Third Year 89,671 90,568 92,697 95,387 99,423
Fourth Year 89,671 90,568 92,697 84,179 84,515
Fifth Year 89,671 90,568 84,963 84,179 84,515
2025 2030 2035 2040
Supply Totals 7,213 7,257 7,335 7,490
Demand Totals 11,287 11,394 11,546 11,801
Difference (4,074) (4,137) (4,211) (4,311)
119
Table 31: Projected Potable Water Use Reductions in Multiple Dry year Scenario
A single dry year followed by 5 more consecutive dry years yields available water supply as
shown in Table 32 and Table 33below using base years of 2020 and 2025 respectively.
Table 32: Water Supply Available to Wholesale Customers in Consecutive Dry Years; 2020
Table 33: Water Supply Available to Wholesale Customers in Consecutive Dry Years; 2025
For Palo Alto, the consecutive dry year scenario using base year 2020 results in a 40% shortfall
by the 3rd consecutive dry year as shown in Table 34. Table 35 shows the same analysis using a
base year of 2025, two years after the assumed implementation of the Bay Delta Plan. Under
these conditions, a 30% shortfall exists in the first dry year.
AFY 2025 2030 2035 2040 2045
Firs t Year 36.1% 36.3% 36.5% 36.5% 45.5%
Second Year 45.2% 45.4% 45.6% 45.6% 45.5%
Third Year 45.2% 45.4% 45.6% 45.6% 45.5%
Fourth Year 45.2% 45.4% 45.6% 52.0% 53.7%
Fifth Year 45.2% 45.4% 50.1% 52.0% 53.7%
Year Type Base Year
RWS Volume
Available (AFY)
% of
Average
Supply
Wholesale
Volume
Available
(AF Y)
Notes on Calculation of Wholesale
Supply
Average Year 2020 222,608 100% 148,069
Single Dry year 222,608 100% 148,069
Consecutive 1st Dry year 222,608 100% 148,069
Consecutive 2nd Dry year 222,608 100% 148,069
Consecutive 3rd Dry year 133,610 60% 83,506
Wholesale allocation assumed to be 62.5%
for shortages 20% or greater
Consecutive 4th Dry year 133,610 60% 83,506 Same as above
Consecutive 5th Dry year 133,610 60% 83,506 Same as above
Year Type Base Year
RWS Volume
Available (AFY)
% of
Average
Supply
Wholesale
Volume
Available
(AF Y)
Notes on Calculation of Wholesale
Supply
Average Year 2025 238,973 100% 163,649
Single Dry year 167,236 70% 104,579
Wholesale allocation assumed to be 62.5%
for 20% or less shortages
Consecutive 1st Dry year 167,236 70% 104,579 Same as above
Consecutive 2nd Dry year 143,361 60% 89,671 Same as above
Consecutive 3rd Dry year 143,361 60% 89,671 Same as above
Consecutive 4th Dry year 143,361 60% 89,671 Same as above
Consecutive 5th Dry year 143,361 60% 89,671 Same as above
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Table 34: Water Supply Available to Palo Alto in Consecutive Dry Years; 2020
Table 35: Water Supply Available to Palo Alto in Consecutive Dry Years; 2025
The five-year drought assessment also assumes the Bay Delta Plan will be implemented in 2023.
Table 36 shows the amount of water projected to be available to the RWS Wholesale
Customers if the next five years are dry, and Table 37 shows the available water to Palo Alto.
The data shows water use reductions in the range of 40%-50% starting in 2023.
Table 36: Projected RWS Supply for 5‐Year Drought Assessment (AFY)
Table 37: projected RWS Supply Available to Palo Alto for 5‐year Drought Assessment (AFY)
While the SFPUC has an adopted Level of Service goal of no more than a 20% system-wide
shortfall, implementation of the Bay Delta Plan is projected to result in greater water supply
Year Type Base Year
RWS Volume
Available (AFY)
% of
Average
Supply
Water Use
Reductions
Average Year 2020 10,921 100% 0.0%
Si ngle Dry year 10,921 100% 0.0%
Consecutive 1st Dry year 10,921 100% 0.0%
Consecutive 2nd Dry year 10,921 100% 0.0%
Consecutive 3rd Dry year 6,555 60% 40.0%
Consecutive 4th Dry year 6,555 60% 40.0%
Consecutive 5th Dry year 6,555 60% 40.0%
Year Type Base Year
RWS Volume
Available (AFY)
% of
Average
Supply
Water Use
Reductions
Average Year 2025 11,287 100% 0.0%
Single Dry year 7,898 70% 30.0%
Consecutive 1st Dry year 7,898 70% 30.0%
Consecutive 2nd Dry year 6,771 60% 40.0%
Consecutive 3rd Dry year 6,771 60% 40.0%
Consecutive 4th Dry year 6,771 60% 40.0%
Consecutive 5th Dry year 6,771 60% 40.0%
Year 2021 2022 2023 2024 2025
RWS Supply (AFY)222,608 222,608 133,610 133,610 133,610
Wholesale Supply (AFY)148,069 148,069 83,506 83,506 83,506
Year 2021 2022 2023 2024 2025
Palo Alto Demand 10,565 10,776 10,982 11,182 11,287
Cutback 0.0% 0.0% 43.6% 43.6% 49.0%
Available Supply 10,565 10,776 6,194 6,306 5,759
121
reductions if and until alternative supplies are developed. These anticipated dry-year supply
reductions will be considered as Palo Alto plans for additional housing development.
In response to a severe drought the City will work with residents and businesses to significantly
reduce water use by implementing the WSCP. The WSCP contains provisions for shortages of
the magnitude shown in the tables in this section, however, the City does not have actual
experience in reducing water use to those levels.
In the most recent drought, the City was able to achieve water use reductions of about 30%,
but there were significant impacts to the tree canopy. The average number of street trees
removed each year in Palo Alto is about 225. It is estimated that an additional 393 street trees
were removed due to the 2014-2016 drought (the actual number of trees is likely to be much
higher including trees on private property). Adjustments to the WSCP have been made to
better protect trees during the next drought; this objective will become significantly more
difficult under drastic water reduction targets. Deeper cutbacks will likely have aesthetic,
environmental, and economic implications throughout the City.
Groundwater from City wells may be a supplemental resource, but it is probable that Valley
Water, the groundwater manager in Santa Clara County, will also require water use reductions,
and the wells are not permitted for sustained long-term use. The City’s wells are restricted to
1,500 AFY, pumping for a maximum of five consecutive days and a maximum of 15 days per
year.
Work to address the potential need for water supply in dry years in the long term is taking place
on three fronts. First, the SFPUC is evaluating alternative water supplies. Second, BAWSCA is
seeking water supplies and solutions for dry year events. Third, the City of Palo Alto has formed
partnerships such as the one with Valley Water and is embarking on a One Water plan which
will have dry year water supply reliability as a central tenet. All three efforts are discussed in
detail earlier in this report.
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123
APPENDIX A ‐ Resolutions Adopting Urban Water
Management Plan and Water Shortage Contingency
Plan
124
APPENDIX B ‐ Public Participation Notices
125
NOTICE OF PUBLIC HEARING
(FOR PUBLICATION ONCE A WEEK FOR TWO SUCCESSIVE WEEKS)
City of Palo Alto
PUBLIC HEARING ON UPDATE OF URBAN WATER MANAGEMENT PLAN AND WATER SHORTAGE
CONTINGENCY PLAN
California law requires the City of Palo Alto review and update its Urban Water Management
Plan (UWMP) every five years. Additionally, the California Department of Water Resources has
imposed new requirements for urban water suppliers to adopt a Water Shortage Contingency
Plan (WSCP). The City Council will hold a public hearing to consider proposed revisions and
updates to its UWMP for 2020-2025 and its WSCP on:
Monday, May 17, 2021, time virtual location (include access instructions for virtual meetings)
City of Palo Alto’s draft 2020 UWMP and WSCP can be viewed at <link>.
Our revision schedule is as follows: <Insert schedule if available>
If you have any questions about Palo Alto’s UWMP or WSCP, please contact Karla Dailey, Sr.
Resource Planner, at Karla.Dailey@CityofPaloAlto.org.
Date: _________________, 2021
126
APPENDIX C ‐ Water Loss Report
127
128
APPENDIX D – DWR Standardized Tables
Public Water System
Number
Public Water System
Name
Number of Municipal
Connections 2020
Volume of
Water Supplied
2020
4310009 City of Palo Alto 20,016 10,722
20,016 10,722
DRAFT Submittal Table 2‐1 Retail Only: Public Water Systems
NOTES:
TOTAL
Water Supplier is also a
member of a RUWMP
Water Supplier is also a
member of a Regional Alliance
Regional Urban Water Management
Plan (RUWMP)
DRAFT Submittal Table 2‐2: Plan Identification
NOTES:
Individual UWMP
Name of RUWMP or Regional Alliance
if applicable
drop down list
Select
Only
One
Type of Plan
129
Supplier is a wholesaler
Supplier is a retailer
UWMP Tables are in calendar years
UWMP Tables are in fiscal years
Unit AF
NOTES:
DRAFT Submittal Table 2‐3: Supplier Identification
Type of Supplier (select one or both)
Fiscal or Calendar Year (select one)
If using fiscal years provide month and date that the
fiscal year begins (mm/dd)
Units of measure used in UWMP (select from drop
down)
7/1
DRAFT Submittal Table 2‐4 Retail: Water Supplier Information Exchange
The retail Supplier has informed the following wholesale supplier(s) of
projected water use in accordance with Water Code Section 10631.
Wholesale Water Supplier Name (Add additional rows as needed)
San Francisco Public Utilities Commission
NOTES:
130
2020 2025 2030 2035 2040 2045(opt)
68,819 71,667 74,815 77,963 81,111 84,259
Submittal Table 3‐1 Retail: Population ‐ Current and Projected
Population
Served
NOTES: Fiscal years
Use Type
Drop down list
May select each use multiple times
These are the only Use Types that will be
recognized by the WUEdata online
submittal tool
Additional Description
(as needed)
Level of Treatment
When Delivered
Drop down list
Volume*
Single Family Drinking Water 4,967
Multi-Family Drinking Water 1,797
Commercial Drinking Water 1,628
Industrial Drinking Water 295
Institutional/Governmental Drinking Water 754
Landscape Drinking Water 1,278
Losses Drinking Water 199
Other Potable Drinking Water 3
10,921
Submittal Table 4‐1 Retail: Demands for Potable and Non‐Potable Water ‐ Actual
2020 Actual
NOTES:
TOTAL
Add additional rows as needed
* Units of measure (AF, CCF, MG) must remain consistent throughout the UWMP as reported in Table 2-3.
131
Use Type
Drop down list
May select each use multiple times
These are the only Use Types that will be recognized by the
WUEdata online submittal tool
2025 2030 2035 2040
2045
(opt)
Single Family 4,796 4,905 5,019 5,163 5,308
Multi-Family 1,837 1,852 1,876 1,913 1,954
Commercial 1,763 1,753 1,750 1,753 1,760
Industrial 313 321 328 336 343
Institutional/Governmental 717 748 779 812 843
Landscape 1,252 1,282 1,313 1,343 1,374
Losses 790 798 808 826 848
Other Potable 2 2 2 2 2
Other Future DMM -184 -267 -329 -348 -320
11,287 11,394 11,546 11,801 12,113
Projected Water Use*
Report To the Extent that Records are Available
Submittal Table 4‐2 Retail: Use for Potable and Non‐Potable Water ‐ Projected
Additional Description
(as needed)
NOTES:
TOTAL
Add additional rows as needed
* Units of measure (AF, CCF, MG) must remain consistent throughout the UWMP as reported in Table 2-3.
132
2020 2025 2030 2035 2040 2045 (opt)
Potable Water, Raw, Other
Non-potable
From Tables 4-1R and 4-2 R
10,921 11,287 11,394 11,546 11,801 12,113
Recycled Water Demand1
From Table 6-4 316 316 316 316 316 316
Optional Deduction of
Recycled Water Put Into Long-
Term Storage2
TOTAL WATER USE 11,237 11,603 11,710 11,862 12,117 12,429
Submittal Table 4‐3 Retail: Total Water Use (Potable and Non‐Potable)
NOTES:
1 Recycled water demand fields will be blank until Table 6-4 is complete 2
Long term storage means water placed into groundwater or surface storage that is not removed
from storage in the same year. Supplier may deduct recycled water placed in long-term storage
from their reported demand. This value is manually entered into Table 4-3.
133
Reporting Period Start Date
(mm/yyyy) Volume of Water Loss 1,2
01/2015 414.56
01/2016 631.75
01/2017 577.766
01/2018 432.045
01/2019 280.672
Submittal Table 4‐4 Retail: Last Five Years of Water Loss
Audit Reporting
NOTES:
1 Taken from the field "Water Losses" (a combination of apparent losses
and real losses) from the AWWA worksheet.
2 Units of measure (AF, CCF, MG) must remain consistent throughout
the UWMP as reported in Table 2-3.
Are Future Water Savings Included in Projections?
(Refer to Appendix K of UWMP Guidebook)
Drop down list (y/n) Yes
If "Yes" to above, state the section or page number, in the cell to the
right, where citations of the codes, ordinances, or otherwise are utilized
in demand projections are found.
Section 5
Are Lower Income Residential Demands Included In Projections?
Drop down list (y/n)Yes
Submittal Table 4‐5 Retail Only: Inclusion in Water Use Projections
NOTES:
134
10-15
year 1995 2004 225
5 Year 2003 2007 208
Submittal Table 5‐1 Baselines and Targets Summary
From SB X7‐7 Verification Form
Retail Supplier or Regional Alliance Only
*All cells in this table should be populated manually from the supplier's
SBX7-7 Verification Form and reported in Gallons per Capita per Day (GPCD)
NOTES:
180
Baseline
Period Start Year * End Year *
Average
Baseline
GPCD*
Confirmed
2020 Target*
Actual
2020 GPCD*
2020 TOTAL
Adjustments*
Adjusted 2020
GPCD*
(Adjusted if
applicable)
142 0 142 180 YES
NOTES:
2020 Confirmed
Target GPCD*
Did Supplier
Achieve
Targeted
Reduction for
2020? Y/N
2020 GPCD
Submittal Table 5‐2: 2020 Compliance From SB
X7‐7 2020 Compliance Form
Retail Supplier or Regional Alliance Only
*All cells in this table should be populated manually from the supplier's SBX7-7 2020
Compliance Form and reported in Gallons per Capita per Day (GPCD)
135
Name of
Wastewater
Collection
Agency
Wastewater
Volume Metered
or Estimated?
Drop Down List
Volume of
Wastewater
Collected from
UWMP Service
Area 2020 *
Name of
Wastewater
Treatment
Agency Receiving
Collected
Wastewater
Treatment Plant
Name
Is WWTP
Located Within
UWMP Area?
Drop Down List
Is WWTP
Operation
Contracted to a
Third Party?
(optional)
Drop Down List
City of Palo Alto Metered 19,324 City of Palo Alto
Regional Water
Quality Control
Plant
Yes No
19,324Total Wastewater Collected from
Service Area in 2020:
NOTES:
* Units of measure (AF, CCF, MG) must remain consistent throughout the UWMP as reported in Table 2-3 .
Submittal Table 6‐2 Retail: Wastewater Collected Within Service Area in 2020
There is no wastewater collection system. The supplier will not complete the table below.
Percentage of 2015 service area covered by wastewater collection system (optional)
Percentage of 2015 service area population covered by wastewater collection system (optional)
Wastewater Collection Recipient of Collected Wastewater
136
Wastewater
Treated
Discharged
Treated
Wastewater
Recycled
Within Service
Area 3
Recycled
Outside of
Service Area
Instream Flow
Permit
Requirement
Regional Water
Quality Control
San Francisco
Bay
Bay or estuary
outfall Yes Tertiary 18,281 17,523 316 442Regional Water
Quality Control
Bay via Emily
Renzel Marsh Wetlands Yes Tertiary 1,043 1,043
Total 19,324 18,566 316 442 0
1Units of measure (AF, CCF, MG) must remain consistent throughout the UWMP as reported in Table 2-3.
2 If the Wastewater Discharge ID Number is not available to the UWMP preparer, access the SWRCB CIWQS regulated facility website at
https://ciwqs.waterboards.ca.gov/ciwqs/readOnly/CiwqsReportServlet?inCommand=reset&reportName=RegulatedFacility
NOTES:
Submittal Table 6‐3 Retail: Wastewater Treatment and Discharge Within Service Area in 2020
No wastewater is treated or disposed of within the UWMP service area. The supplier will not complete the table below.
Wastewater
Treatment Plant
Name
Discharge
Location
Name or
Identifier
Discharge
Location
Description
Wastewater
Discharge ID
Number
(optional) 2
Method of
Disposal
Drop down list
Does This
Plant Treat
Wastewater
Generated
Outside the
Service Area?
Drop down list
Treatment
Level
Drop down list
2020 volumes 1
Potential Beneficial
Uses of Recycled
Water (Describe)
Amount of Potential
Uses of Recycled Water
(Quantity)
Include volume units 1
General Description
of 2020 Uses
Level of
Treatment
Drop down list
2020 1 2025 1 20301 20351 20401 20451 (opt)
Parks 1137.6 Tertiary 37 37 37 37 37 37
Palo Alto Municipal 249.6 Tertiary 250 250 250 250 250 250
Palo Alto Duck Pond 24.8 Tertiary 25 25 25 25 25 25
Water Trucks 4 Tertiary 4 4 4 4 4 4
Total:316 316 316 316 316 316
NOTES:
Agricultural irrigation
Landscape irrigation (exc golf courses)
Commercial use
Golf course irrigation
Supplemental Water Added in 2020 (volume) Include units
Source of 2020 Supplemental Water
Beneficial Use Type
Insert additional rows if needed.
Geothermal and other energy production
Other (Description Required)
2020 Internal Reuse
1 Units of measure (AF, CCF, MG) must remain consistent throughout the UWMP as reported in Table 2-3.
Reservoir water augmentation (IPR)
Direct potable reuse
Submittal Table 6‐4 Retail: Recycled Water Direct Beneficial Uses Within Service Area
Recycled water is not used and is not planned for use within the service area of the supplier.
The supplier will not complete the table below.
Name of Supplier Producing (Treating) the Recycled Water:
Name of Supplier Operating the Recycled Water Distribution System:
Wetlands or wildlife habitat
Groundwater recharge (IPR)
Industrial use
Seawater intrusion barrier
Recreational impoundment
137
2015 Projection for 2020 2020 Actual Use
Landscape irrigation (excludes golf courses)175 37
166 250
448
Geothermal and other energy production
29 25
Other Water Trucks 4
818 316
Recycled water was not used in 2015 nor projected for use in 2020.
The Supplier will not complete the table below.
DRAFT Submittal Table 6‐5 Retail: 2015 UWMP Recycled Water Use Projection Compared to 2020
Actual
Use Type
NOTES:
Total
Groundwater recharge (IPR)
Direct potable reuse
Agricultural irrigation
Industrial use
Seawater intrusion barrier
Recreational impoundment
Wetlands or wildlife habitat
Surface water augmentation (IPR)
Golf course irrigation
Commercial use
Name of Action Description
Planned
Implementation
Year
Expected Increase in
Recycled Water Use
0
DRAFT Submittal Table 6‐6 Retail: Methods to Expand Future Recycled Water Use
Total
NOTES: Supplier is evaluating recycled water expansion projects. No projects are currently approved.
Supplier does not plan to expand recycled water use in the future. Supplier will not
complete the table below but will provide narrative explanation.
Provide page location of narrative in UWMP
Add additional rows as needed
138
Drop Down List (y/n)If Yes, Agency Name
No expected future water supply projects or programs that provide a quantifiable increase to the agency's
water supply. Supplier will not complete the table below.
Some or all of the supplier's future water supply projects or programs are not compatible with this table and are
described in a narrative format.
DRAFT Submittal Table 6‐7 Retail: Expected Future Water Supply Projects or Programs
Joint Project with other suppliers?
NOTES: Supplier is embarking on a One Water planning process which will include evaluating alternative water supply projects.
Name of Future
Projects or
Programs
Description
(if needed)
Planned
Implementation
Year
Expected
Increase in
Water Supply
to Supplier
This may be a range
Planned for
Use in Year
Type
Drop Down List
Provide page location of narrative in the UWMP
Add additional rows as needed
139
Water Supply
Drop down list
May use each category multiple times.
These are the only water supply categories
that will be recognized by the WUEdata
online submittal tool
Actual Volume
Water
Quality
Drop Down
List
Total Right
or Safe
Yield
(optional)
Purchased or Imported Water SFPUC Regional Water
Supply System 10,921 Drinking
Water
Recycled Water
Recycled Water from
the Regional Water
Quality Control Plant
316 Recycled
Water
11,237 0
DRAFT Submittal Table 6‐8 Retail: Water Supplies — Actual
Additional Detail on
Water Supply
2020
NOTES:
Total
Add additional rows as needed
140
Water Supply
Reasonably
Available
Volume
Total Right
or Safe Yield
(optional)
Reasonably
Available
Volume
Total Right
or Safe Yield
(optional)
Reasonably
Available
Volume
Total Right
or Safe Yield
(optional)
Reasonably
Available
Volume
Total Right
or Safe Yield
(optional)
Reasonably
Available
Volume
Total Right
or Safe Yield
(optional)
Purchased or Imported
Water
SFPUC Regional
Water System 16,334 16,334 16,334 16,334 16,334
Recycled Water
Recycled water from
Regional Water
Quality Control Plant
316 316 316 316 316
16,650 0 16,650 0 16,650 0 16,650 0 16,650 0
NOTES:
DRAFT Submittal Table 6‐9 Retail: Water Supplies — Projected
Additional Detail on
Water Supply
Projected Water Supply
Report To the Extent Practicable
2025 2030 2035 2040 2045 (opt)
Total
Drop down list
May use each category multiple
times. These are the only water
supply categories that will be
recognized by the WUEdata online
submittal tool
Add additional rows as needed
141
% of Average Supply
Average Year 2025 11603 100%
Single-Dry Year 71%
Consecutive Dry Years 1st Year 71%
Consecutive Dry Years 2nd Year 61%
Consecutive Dry Years 3rd Year 61%
Consecutive Dry Years 4th Year 61%
Consecutive Dry Years 5th Year 61%
8214
8214
7087
Submittal Table 7‐1 Retail: Basis of Water Year Data (Reliability Assessment)
Year Type
Base Year
If not using a
calendar year, type
in the last year of
the fiscal, water
year, or range of
years, for example,
water year 2019-
2020, use 2020
Available Supplies if
Year Type Repeats
Quantification of available supplies is not
compatible with this table and is provided
elsewhere in the UWMP.
Location __________________________
Quantification of available supplies is
provided in this table as either volume only,
percent only, or both.
Volume Available *
7087
7087
7087
NOTES: Assumes Bay Delta Plan comes into effect in 2023.
Supplier may use multiple versions of Table 7-1 if different water sources have different base years and
the supplier chooses to report the base years for each water source separately. If a Supplier uses
multiple versions of Table 7-1, in the "Note" section of each table, state that multiple versions of Table 7-
1 are being used and identify the particular water source that is being reported in each table.
*Units of measure (AF, CCF, MG ) must remain consistent throughout the UWMP as reported in Table 2-
3
142
2025 2030 2035 2040 2045 (Opt)
Supply totals
(autofill from Table 6-9)16,650 16,650 16,650 16,650 16,650
Demand totals
(autofill from Table 4-3)11,603 11,710 11,862 12,117 12,429
Difference 5,047 4,940 4,788 4,533 4,221
Submittal Table 7‐2 Retail: Normal Year Supply and Demand Comparison
NOTES:
2025 2030 2035 2040 2045 (Opt)
Supply totals*7,529 7,573 7,651 7,806
Demand totals*11,603 11,710 11,862 12,117
Difference (4,074) (4,137) (4,211) (4,311)0
Submittal Table 7‐3 Retail: Single Dry Year Supply and Demand Comparison
NOTES: Assumes Bay Delta Plan comes into effect in 2023.
*Units of measure (AF, CCF, MG) must remain consistent throughout the UWMP as reported in
Table 2-3.
143
2025 2030 2035 2040 2045 (Opt)
Supply totals*7,213 7,257 7,335 7,490
Demand totals*11,287 11,394 11,546 11,801
Difference (4,074) (4,137) (4,211) (4,311)0
OPTIONAL Table 7‐3 Retail: Single Dry Year Supply and Demand
Comparison ‐ Potable
NOTES:
*Units of measure (AF, CCF, MG) must remain consistent throughout the UWMP as reported in
Table 2-3.
2025 2030 2035 2040 2045 (Opt)
Supply totals*316 316 316 316
Demand totals*316 316 316 316
Difference 0 0 0 0 0
NOTES:
OPTIONAL Table 7‐3 Retail: Single Dry Year Supply and Demand
Comparison ‐ Non‐Potable
*Units of measure (AF, CCF, MG) must remain consistent throughout the UWMP as reported in
Table 2-3.
144
2025* 2030* 2035*2040*2045*
(Opt)
Supply totals 7,529 7,573 7,651 7,806
Demand totals 11,603 11,710 11,862 12,117
Difference (4,074) (4,137) (4,211) (4,311)0
Supply totals 6,500 6,541 6,602 6,741
Demand totals 11,603 11,710 11,862 12,117
Difference (5,102) (5,169) (5,260) (5,376)0
Supply totals 6,500 6,541 6,602 6,741
Demand totals 11,603 11,710 11,862 12,117
Difference (5,102) (5,169) (5,260) (5,376)0
Supply totals 6,500 6,541 6,602 5,986
Demand totals 11,603 11,710 11,862 12,117
Difference (5,102) (5,169) (5,260) (6,131)0
Supply totals 6,500 6,541 6,602 5,986
Demand totals 11,603 11,710 11,862 12,117
Difference (5,102) (5,169) (5,260) (6,131)0
Supply totals
Demand totals
Difference 0 0 0 0 0
Submittal Table 7‐4 Retail: Multiple Dry Years Supply and Demand Comparison
First year
Second year
Third year
NOTES: Assumes Bay Delta Plan comes into effect in 2023.
Fourth year
Fifth year
Sixth year
(optional)
*Units of measure (AF, CCF, MG) must remain consistent throughout the UWMP as reported in Table 2-3.
145
2021 Total
Total Water Use 10,881
Total Supplies 10,881
Surplus/Shortfall w/o WSCP Action 0
WSCP - supply augmentation benefit
WSCP - use reduction savings benefit
Revised Surplus/(shortfall)0
Resulting % Use Reduction from WSCP action 0%
2022 Total
Total Water Use 11,092
Total Supplies 11,092
Surplus/Shortfall w/o WSCP Action 0
WSCP - supply augmentation benefit
WSCP - use reduction savings benefit 636
Revised Surplus/(shortfall)636
Resulting % Use Reduction from WSCP action 6%
2023 Total
Total Water Use 11,298
Total Supplies 6,510
Surplus/Shortfall w/o WSCP Action (4,788)
WSCP - supply augmentation benefit
WSCP - use reduction savings benefit 5,238
Revised Surplus/(shortfall)450
Resulting % Use Reduction from WSCP action 46%
2024 Total
Total Water Use 11,498
Total Supplies 6,622
Surplus/Shortfall w/o WSCP Action (4,876)
WSCP - supply augmentation benefit
WSCP - use reduction savings benefit 5,412
Revised Surplus/(shortfall)536
Resulting % Use Reduction from WSCP action 47%
2025 Total
Total Water Use 11,603
Total Supplies 6,075
Surplus/Shortfall w/o WSCP Action (5,528)
WSCP - supply augmentation benefit
WSCP - use reduction savings benefit 5,531
Revised Surplus/(shortfall)3
Resulting % Use Reduction from WSCP action 48%
Submittal Table 7‐5: Five‐Year Drought Risk Assessment Tables to
address Water Code Section 10635(b)
Planned WSCP Actions (use reduction and supply augmentation)
Planned WSCP Actions (use reduction and supply augmentation)
Planned WSCP Actions (use reduction and supply augmentation)
Planned WSCP Actions (use reduction and supply augmentation)
Planned WSCP Actions (use reduction and supply augmentation)
146
Percent
Shortage
Range 1
Numerical value as
a percent
Water Shortage Condition
(Narrative description)
1 Up to 10%Minimum Water Shortage
2 Up to 20%Moderate Water Shortage
3 Up to 30%Severe Water Shortage
4 Up to 40%Severe - Critical Water Shortage
5 Up to 50%Critical Water Shortage
6 >50%
Water Emergency
1 One stage in the Water Shortage Contingency Plan must address a water shortage of 50%.
NOTES:
DRAFT Submittal Table 8‐1
Water Shortage Contingency Plan Levels
Shortage
Level
Complete Both
Add additional rows as needed
147
Shortage
Level
Demand Reduction Actions
Drop down list
These are the only categories that will be accepted by the
WUEdata online submittal tool. Select those that apply to
you.
How much is this going to reduce the shortage gap?
Include volume units used.
Additional Explanation or Reference
(optional)
Penalty, Charge,
or Other
Enforcement?
Drop Down List
Stage I (Up to 10%)Expand Public Information Campaign 3%-5%
Focus of the informational outreach and audit programs
would be on water saving information.No
Stage I (Up to 10%)Other 2%-5%Permanent Ordinances Prohibiting Water Waste No
Stage I (Up to 10%)Other 5%-10%
Incentive-Based Demand Side Management Programs, as
appropriate No
Stage II (10%-20%)Expand Public Information Campaign 3%-5%
Increase advertising, social media campaigns and direct
communication with customers targeting highest users
and increasing water use auditing No
Stage II (10%-20%)Other 5%-10%
Incentive-Based Demand Side Management Programs, as
appropriate No
Stage II (10%-20%)
Implement or Modify Drought Rate Structure or
Surcharge 5%-10%
If reduction goals are not being met, reduction targets
may need to be developed for each customer class.No
Stage II (10%-20%)Landscape - Limit landscape irrigation to specific times 3-5%
Irrigation with potable water during and within 48 hours
after a measurable rainfall prohibited.Yes
Stage II (10%-20%)
Landscape - Restrict or prohibit runoff from landscape
irrigation 3-5%
Application of potable water to driveways and sidewalks
is prohibited, with exceptions.
Stage II (10%-20%)Other 2-5%
Permanent Ordinances Prohibiting Water Waste; water
use restrictions become more severe with each stage and
enforcement is enacted more strongly with each stage.
Efforts made at each stage to ensure tree canopy is
protected as much as possible.Yes
Stage III (20%-30%)Expand Public Information Campaign 5%-10%
Increase advertising, social media campaigns and direct
communication with customers targeting highest users
and increasing water use auditing No
Stage III (20%-30%)Other 5%-10%
Incentive-Based Demand Side Management Programs, as
appropriate No
Stage III (20%-30%)
Implement or Modify Drought Rate Structure or
Surcharge 5%-10%Drought rate structures may be implemented No
Stage III (20%-30%)Landscape - Limit landscape irrigation to specific days 10-15%
Restrictions on the number of days per week irrigation is
permitted; alternative irrigation plans established for golf
courses, parks and schools with specific water use
reduction targets.Yes
Stage III (20%-30%)Other 5-10%
Additional emergency water use restrictions added to
permanent restrictions Yes
Stage IV (30%-40%)Expand Public Information Campaign 5%-15%
Increase advertising, social media campaigns and direct
communication with customers targeting highest users
and increasing water use auditing No
Stage IV (30%-40%)Other 5%-15%
Incentive-Based Demand Side Management Programs, as
appropriate No
Stage IV (30%-40%)
Implement or Modify Drought Rate Structure or
Surcharge 5%-10%Drought rate structures may be implemented No
Stage IV (30%-40%)Landscape - Limit landscape irrigation to specific days 10% to 20%
Further restrictions on the number of days per week
irrigation is permitted; alternative irrigation plans
established for golf courses, parks and schools with
specific water use reduction targets Yes
Stage IV (30%-40%)Other 5-10%
Additional emergency water use restrictions added to
permanent restrictions Yes
Stage V(40%-50%)
Moratorium or Net Zero Demand Increase on New
Connections 1-5%
No new water service connections unless the customer
pays for sufficient conservation measures elsewhere in
the city to offset water use.Yes
Stage V(40%-50%)Expand Public Information Campaign 5-15%
Escalate outreach efforts and media campaign with focus
on water use prioritization No
Stage V(40%-50%)Other 5-15%
Incentive-Based Demand Side Management Programs, as
appropriate No
Stage V(40%-50%)
Implement or Modify Drought Rate Structure or
Surcharge 10-15%Water allocations or allotments may be implemented No
Stage V(40%-50%)
Landscape - Prohibit certain types of landscape
irrigation 15-25%
Outdoor water use restrictions, possibly with some
allocation for the tree canopy maintenance, ornamental
landscape and turf irrigation prohibited.Yes
Stage V(40%-50%)Other 5-10%
Additional emergency water use restrictions added to
permanent restrictions Yes
Stage VI (>50%)Expand Public Information Campaign 5-15%
Highest outreach effort level with focus on health and
safety No
Stage VI (>50%)Other 5-15%
Incentive-Based Demand Side Management Programs, as
appropriate No
Stage VI (>50%)
Implement or Modify Drought Rate Structure or
Surcharge 10-15%Water allocations or allotments may be implemented No
Stage VI (>50%)Landscape - Prohibit all landscape irrigation 25-35%
Water use restricted to health and safety needs, possibly
with some allocation for the tree canopy maintenance.Yes
Stage VI (>50%)Other 5-10%
Additional emergency water use restrictions added to
permanent restrictions Yes
NOTES: Implementation of individual restrictions within each stage shall be carried out at the direction of the City Council, in response to its assessment of local water supply conditions, feasibility, and
consumption trends. Water use restrictions are maintained from one stage to the next: Stage III has all the water use restrictions for Stage II as well as the restrictions listed for Stage III, Stage IV has all the water
use restrictions for Stages II and III as well as the restrictions listed for Stage IV; Stage V has all the water use restrictions for Stages II, III, and IV as well as the restrictions listed for Stage V, and Stage VI has all the
water use restrictions for Stages II, III, IV and V as well as the restrictions listed for Stage VI. Stages II through V will include Alternative Irrigation Plans with specific water use reduction targets for high-value
landscapes such as playing fields and golf courses.
DRAFT Submittal Table 8‐2: Demand Reduction Actions
Add additional rows as needed
148
2021 2022 2023
Available Water
Supply 10,565 10,776 10,334
DRAFT Submittal Table 8‐4 Retail: Minimum Supply
Next Three Years
NOTES:
149
City Name 60 Day Notice Notice of Public
Hearing
Brisbane Yes Yes
Burlingame Yes Yes
Daly City Yes Yes
East Palo Alto Yes Yes
Foster City Yes Yes
Hayward Yes Yes
Hillsborough Yes Yes
Menlo Park Yes Yes
Millbrae Yes Yes
Milpitas Yes Yes
Mountain View Yes Yes
Redwood City Yes Yes
San Bruno Yes Yes
San Jose Yes Yes
Santa Clara Yes Yes
Sunnyvale Yes Yes
County Name
Drop Down List 60 Day Notice Notice of Public
Hearing
Santa Clara
County Yes Yes
NOTES:
Submittal Table 10‐1 Retail: Notification to Cities and
Counties
Add additional rows as needed
Add additional rows as needed
150
Urban Water Supplier:
Water Delivery Product (If delivering more than one type of product use Table O-1C)
Retail Potable Deliveries
Table O‐1B: Recommended Energy Intensity ‐ Total Utility Approach
Enter Start Date for Reporting Period 7/1/2019
End Date 6/30/2020
Sum of All Water
Management Processes
Total Utility Hydropower Net Utility
Volume of Water Entering Process (AF)10921 0 10921
Energy Consumed (kWh)1500000 0 1500000
Energy Intensity (kWh/AF)137.4 0.0 137.4
Quantity of Self‐Generated Renewable Energy
kWh
Data Quality (Estimate, Metered Data, Combination of Estimates and Metered Data)
Combination of Estimates and Metered Data
Data Quality Narrative:
Narrative:
City of Palo Alto
Since 2013, the City's electric supply has been carbon neutral, making the greenhouse gas footprint negligible.
Urban Water Supplier Operational Control
Non‐Consequential
Hydropower
151
NOTES:
SB X7‐7 Table 2: Method for 2020 Population Estimate
Method Used to Determine 2020 Population
(may check more than one)
1. Department of Finance (DOF) or
American Community Survey (ACS)
3. DWR Population Tool
4. Other
DWR recommends pre-review
2. Persons‐per‐Connection Method
68,819 2020
SB X7‐7 Table 3: 2020 Service Area Population
2020 Compliance Year Population
NOTES: Fiscal year
152
153
2020
Industrial
Water Use
2020
Population
2020
Industrial
GPCD
Eligible for
Exclusion Y/N
68,819 - NO
Data from this table will not be entered into WUEdata.
Instead, the entire table will be uploaded to WUEdata as a separate upload in Excel
format.
NOTES:
SB X7‐7 Table 4‐C.2: 2020 Process Water Deduction Eligibility (For
use only by agencies that are deducting process water using Criteria 2)
Criteria 2
Industrial water use is equal to or greater than 15 GPCD
2020 Compliance
Year
154
2020 Gross
Water Use
Without
Process Water
Deduction
Fm SB X7-7
Table 4
2020
Industrial
Water Use
2020 Non-
industrial
Water Use
2020
Population
Fm SB X7-7
Table 3
Non-
Industrial
GPCD
Eligible for
Exclusion
Y/N
10,921 10,921 68,819 142 NO
NOTES:
Data from this table will not be entered into WUEdata.
Instead, the entire table will be uploaded to WUEdata as a separate upload in Excel format.
Criteria 3
Non-industrial use is equal to or less than 120 GPCD
SB X7‐7 Table 4‐C.3: 2020 Process Water Deduction Eligibility (For use only
by agencies that are deducting process water using Criteria 3)
2020 Compliance
Year
2020 Gross Water
Fm SB X7-7 Table 4
2020 Population Fm
SB X7-7 Table 3 2020 GPCD
10,921 68,819 142
SB X7‐7 Table 5: 2020 Gallons Per Capita Per Day
(GPCD)
NOTES:
155
Extraordinary
Events 1
Weather
Normalization1
Economic
Adjustment1
142 - - - - 142 180 YES
NOTES:
1 All values are reported in GPCD
2 2020 Confirmed Target GPCD is taken from the Supplier's SB X7-7 Verification Form Table SB X7-7, 7-F.
SB X7‐7 Table 9: 2020 Compliance
Optional Adjustments to 2020 GPCD Did Supplier
Achieve
Targeted
Reduction for
2020?
Actual 2020
GPCD1
2020 Confirmed
Target GPCD 1, 2TOTAL
Adjustments1
Adjusted 2020
GPCD 1
(Adjusted if
applicable)
Enter "0" if Adjustment Not Used
156
APPENDIX E – City of Palo Alto Resolution Approving Water
Shortage Allocation Plan (w/attachments)
157
158
159
APPENDIX F ‐ Water Shortage Contingency Plan Draft
Ordinance
160
161
APPENDIX G ‐ Water Shortage Contingency Plan Evaluation
Criteria
162
CRITERIA TO EVALUATE WATER SHORTAGE RESPONSE PLAN
This appendix lists criteria expected to guide the selection of allocation/allotment strategies
whenever water use reductions are needed. Not all of them may be applicable to every strategy
but customer perception of equity is important in achieving the necessary reductions.
1. Reduce overall City consumption by reduction target required – this is the effective goal of
any plan. To accomplish this goal the percentage reduction for the various customer
classes will necessarily vary because their ratios of indoor/outdoor use varies.
2. Sufficient water available for personal use – the most important use of water is for basic
drinking, health, and sanitary uses, and therefore, this is given the highest priority of use.
This prioritization will drive both rate schedules and water use restrictions. However,
within allowed limits (i.e., water use restriction ordinances), customers will be able to
choose how they use their allotment between indoor and outdoor uses.
3. Acceptance by the community – many people tend to evaluate or accept a particular
water- rationing plan in terms of how it would directly affect them. It is this aspect which
makes it difficult to gain a popular consensus on any one plan. However, any plan must be
generally accepted by the community to be successful. One important aspect of
acceptance is the public’s understanding of the program; thus, it is viewed as important to
make the plan as uncomplicated as possible.
4. Minimize unemployment or business loss – water is extensively used in both commercial
and industrial functions. If water is severely limited to these consumers, increased
unemployment and business losses could result. Staff intends that, wherever possible, this
should be avoided. Still, outside water use must be sacrificed greatly if only minimal indoor
reductions are required. Cooling tower use for air conditioning must also be considered.
5. Landscaping investment losses – in cases of critical or severe shortage of water, it is
expected that significant landscaping losses may arise. The use of recycled water should be
encouraged for certain applications. In some cases, using the City’s well system to
augment the SFPUC supply will be an option to provide a minimum amount of water for
landscaping. In this case, the goal should be to keep valuable and mature trees and
plantings alive. Shrubs and lawns will be considered a lower priority.
6. Workable plan – the plan must be workable in order to accomplish its goal. It must take
the following factors into account:
a. Cost - the cost of any water plan to the public should be minimized.
b. Enforcement - enforcement is viewed as a key component of any plan. Those plans
requiring fewer resources for enforcement would be preferable. However, the success
163
of a plan is contingent upon effective enforcement and the utility must be provided the
resources to meet the enforcement objective. The current staff can only absorb a
certain level of additional responsibilities without unreasonably impacting service to
the customer.
c. The plan must be practical and feasible from a data processing viewpoint and not
subject to erroneous results due to incomplete or inaccurate databases. A realistic
timeframe must be allowed to perform any necessary data entry or customer
programming functions.
9. Flexibility – the water shortage is a dynamic situation and may get better or worse. Thus, it
is necessary that any plan be adaptable to changes in targets or adjustable if original
expectations are not being met.
10. Allowance for new services – some provision must be made in any plan to serve new
establishments or those under construction.
12. Recover penalties applied by suppliers – revenue should be collected to the extent
necessary to recover any penalties that may be charged by suppliers.
164
APPENDIX H ‐ Water Shortage Contingency Plan Use
Restrictions
165
WATER USE RESTRICTIONS
Water use restrictions will depend on local conditions and on the length of the water shortage or
drought. The City’s Water Shortage Contingency Plan identifies measures appropriate for various
stages of action, based on reduction targets for each stage. Section A of this Appendix describes
the City’s existing water use regulations. The restrictions in Section B are additional restrictions
that could be applied in various stages or a drought or other water supply shortage. These staged
restrictions are intended to serve as tools within the broader framework of the Urban Water
Shortage Contingency Plan, to help the City reduce potable water consumption.
Implementation of individual restrictions within each stage shall be carried out at the direction
of the City Council, in response to its assessment of local water supply conditions, feasibility, and
consumption trends. The Council may, in its discretion, opt to revise, delete or include different
elements than those described below, so long as the restrictions implemented serve the overall
purpose of reducing local consumption.
A. Permanent Water Use Regulations (See Palo Alto Municipal Code Section 12.32.010)
1. Flooding or runoff of potable water into gutters, driveways, sidewalks, streets or other
unlandscaped areas is prohibited.
2. An operating shut-off valve is required for hoses used to wash cars, boats, trailers, buses or
other vehicles, or to wash sidewalks, building structures, other hard-surfaced areas or parts
thereof. Use of a hose for such purposes should be avoided whenever possible.
3. Potable water for consolidation of backfill and other nondomestic uses in construction shall
not be used if other water sources, such as reclaimed water, are available, as determined
by the Director of Utilities or his or her designee. Applicants for hydrant permits from the
city of Palo Alto shall be deemed to have consented to restrictions on water use which may
be imposed by the Director of Utilities or his or her designee.
4. Any broken or defective plumbing, sprinklers, watering or irrigation systems which permit
the escape or leakage of water shall be repaired or replaced as soon as possible, but no later
than the date established by the Director of Utilities, or his or her designee, as reasonable
after observation of the broken or defective system.
5. Ornamental landscape1 or turf irrigation with potable water shall not be allowed between
10:00 a.m. and 6:00 p.m., except via hand watering with a bucket or a hose with an
operating shut-off valve.
6. The use of potable water in a fountain or other decorative water feature is prohibited,
except where the water is part of a recirculating system.
7. The use of potable water for street sweepers/washers is prohibited if non-potable water is
available, as determined by the Director of Utilities, or his or her designee.
8. Commercial car washes must use recycled water systems, if economically feasible.
166
B. Additional Restrictions Available for Council’s Consideration in Droughts or Other Water
Supply Shortages
Stage I – Minimum Water Supply Shortage: Up to 10% Target Water Savings
No additional restrictions
Stage II – Moderate Water Supply Shortage: 10% - 20% Target Water Savings
1. Irrigation with potable water during and within 48 hours after a measurable rainfall, as
determined by the Director of Utilities, or his or her designee, and posted on the Palo Alto
website, is prohibited.
2. The application of potable water to driveways and sidewalks is prohibited, except where
necessary to address an immediate health and safety need or to comply with a term or
condition in a permit issued by a state or federal agency.
3. Restaurants and other food service operations shall serve water to customers only upon
request.
4. Operators of hotels and motels shall provide guests with the option of choosing not to have
towels and linens laundered daily. The hotel or motel shall prominently display notice of this
option in each guestroom using clear and easily understood language.
Stage III – Severe Water Supply Shortage: 20% - 30% Target Water Savings
All water use restrictions for Stage II, and the following:
1. The irrigation of ornamental landscapes1 or turf with potable water more than three days
per week is prohibited during the months of April through October.2
2. The irrigation of ornamental landscapes1 or turf with potable water more than one day per
week is prohibited during the months of November through March.2
3. The filling of newly constructed pools, spas and hot tubs is prohibited.
4. Water allocations may be imposed.
4. Golf courses, schools, and parks have the option to be placed on Alternative Irrigation Plans
with targets established by the Director of Utilities.
Stage IV – Severe to Critical Water Supply Shortage: 30% - 40% Target Water Savings
All water use restrictions for Stages II, and III, and the following:
1. The irrigation of ornamental landscapes1 or turf with potable water more than two days
per week is prohibited during the months of April through October.2
2. Water allocations may be imposed.
3. Drought tolerant landscaping that minimizes irrigation and runoff is required at new
construction sites, and non-drought tolerant landscaping is prohibited.
4. Golf courses, schools, and parks have the option to be placed on Alternative Irrigation Plans
with targets established by the Director of Utilities.
Stage V – Critical Water Supply Shortage: 40% - 50% Target Water Savings
All water use restrictions for Stages II, III and IV, and the following:
167
1. No new water service connections are permitted unless the customer pays for sufficient
conservation measures to be applied elsewhere in the City, to offset anticipated water
use at the site to be served by the new water service, as determined by the City of Palo
Alto.
2. Ornamental landscape and turf irrigation with potable water is prohibited.
3. The washing of all vehicles is prohibited except for at commercial washing facility that
recirculates its water or uses recycled water.
4. Sprinkler irrigation is prohibited.
Stage VI – Water Emergency: Greater than 50% Target Water Savings
All water use restrictions for Stages II, III, IV, and V and the following:
1. All outdoor water use is prohibited except to maintain health and safety.
2. Some targeted water use to keep trees alive may be permitted.
1 “Ornamental landscapes” serve purely decorative purposes, and are distinguished from trees, edible gardens or
landscapes that provide more than a purely aesthetic function.
2 Customers with a public or private non-residential facility containing ornamental landscapes or turf which
supports a demonstrable business necessity or public benefit may apply for City approval of an alternative
irrigation schedule.
May 12, 2021 www.cityofpaloalto.org
2020 Urban Water Management Plan and Water Shortage Contingency Plan
Utilities Advisory Commission
•
CITY OF
PALO ALTO
Attachment D
TITLE 40 FONT BOLD
Subtitle 32 font
2 www.cityofpaloalto.org
Supports long-term resource planning to ensure adequate water supplies are
available to meet existing and future water needs
Required by the Urban Water Management Planning Act
Prepared every five years by urban water suppliers to ensure adequate supplies meet
existing and future water demands
Required if supplier provides more than 3,000 acre-feet per year (AFY) or serves more
than 3,000 connections
WHAT IS AN UWMP?•
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
3 www.cityofpaloalto.org
5-year Water Reliability Analysis
Was 3 -year
Drought Risk Assessment
New annual requirement for Water Supply and Demand Assessment
Seismic resiliency discussion
Water Shortage Contingency Plan
6 stages including one >50% water supply reduction
NEW REQUIREMENTS IN 2020 •
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
4 www.cityofpaloalto.org
New Palo Alto Water Demand Projection:
Updated Population and Employment projections
Impacts of 2015 drought and resulting conservation
Completed Northwest County Recycled Water Strategic Plan
Groundwater study
Potable and non-potable alternatives for Regional Water Quality Control Plant
effluent
Executed Historic Agreement with Valley Water and Mountain View
Funding for salt-removal facility at Regional Water Quality Control Plant
Regional partnership for purified water project
Secured ability to purchase water from Valley Water in the future
PALO ALTO UPDATES SINCE 2015 •
CITY OF
PALO ALTO
5 www.cityofpaloalto.org
PALO ALTO WATER DEMAND
Annual
Purchases
from
SFPUC
(1000 AFY)
Fiscal Year
18
16
14
12
10
8
6
4
2
00 0 N ~ ~ 00 0 N ~ ~ 00 0 N ~ ~ 00 oo m m m m m o o o o o M M M M M m m m m m m o o o o o o o o o o
M M M M M M N N N N N N N N N N
Actual
N ~ 0 0 N N ("'(") ~
0 0 0 0
N N N N
Forecast
•
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
6 www.cityofpaloalto.org
WATER SALES BY CUSTOMER CLASS
Landscape
1.2%
Institutional
4%,
Industrial
3%
Com11merciall
15%
Multifamiily -
17%
•
CITY OF
PALO ALTO
1Government
3%,
TITLE 40 FONT BOLD
Subtitle 32 font
7 www.cityofpaloalto.org
NORMAL YEAR SUPPLY AND DEMAND
Year 2020 2025 2030 2035 2040 2045
Palo Alto Demand for
SFPUC Water (Acre-Feet)
10,921 11,287 11,394 11,546 11,801 12,113
Individual Supply
Guarantee (Acre-Feet)
18,584 18,584 18,584 18,584 18,584 18,584
Difference (Acre Feet)7,663 7,298 7,190 7,039 6,783 6,471
•
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
8 www.cityofpaloalto.org
Water Waste Prevention Ordinance
Green Building Ordinance and Model Efficient Landscape Ordinance
Advanced Metering
Conservation Pricing (within bounds of cost of service)
Education and Outreach
Water Meter and Main Replacement
Rebate Programs (administered by Valley Water)
WATER DEMAND MANAGEMENT •
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
9 www.cityofpaloalto.org
100% Potable Supplies from SFPUC
85% Tuolumne River
15% Local Surface Water
Bay Delta Plan adopted by State Water Resources Control Board and supported by
Palo Alto City Council requires 30%-50% unimpaired flow Tuolumne
UWMP Analysis Assumes Bay Delta Plan comes into effect in 2023
WATER SUPPLY RELIABILITY •
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
10 www.cityofpaloalto.org
5-YEAR DROUGHT RISK ASSESSMENT
Year 2021 2022 2023 2024 2025
Palo Alto Demand for SFPUC
Water (Acre-Feet)
10,565 10,776 10,982 11,182 11,287
Cutback 0.0%0.0%43.6%43.6%49.0%
Available Supply (Acre Feet)10,565 10,776 6,194 6,306 5,759
Assumes Bay Delta Plan comes into effect in 2023
•
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
11 www.cityofpaloalto.org
CUTBACKS NEEDED IN MULTIPLE DRY YEARS
Year 2025 2030 2035 2040 2045
First Year 36.1%36.3%36.5%36.5%45.5%
Second Year 45.2%45.4%45.6%45.6%45.5%
Third Year 45.2%45.4%45.6%45.6%45.5%
Fourth Year 45.2%45.4%45.6%52.0%53.7%
Fifth Year 45.2%45.4%50.1%52.0%53.7%
Assumes Bay Delta Plan comes into effect in 2023
•
CITY OF
PALO ALTO
12 www.cityofpaloalto.org
Actions tailored to each stage including:
Information Outreach and Audit Program
Demand Side Management Programs
Rate Structures
Water Use Restrictions
Recycled Water Use
WATER SHORTAGE CONTINGENCY PLAN
Plan Stage Target Water
Savings
I Up to 10%
II 10%-20%
III 20%-30%
IV 30%-40%
V 40%-50%
VI >50%
•
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
13 www.cityofpaloalto.org
Groundwater, deep and shallow (managed by Valley Water)
Need investments to use during water shortages
Water Reuse
Stormwater
Greywater/Blackwater
Conservation
Palo Alto Planning for the Future in Upcoming One Water Plan
Bay Area Water Supply and Conservation Agency
Regional coordination to identify dry-year water supply projects including storage,
conveyance and water reuse
WATER SUPPLY ALTERNATIVES AND PLANS •
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
14 www.cityofpaloalto.org
SFPUC current projects
Calaveras Dam replacement – done
Alameda Creek Recapture
Lower Crystal Springs Dam
Regional Groundwater Storage and Recovery in Daly City
Alternative Water Supply Planning Program
Water Reuse
Storage
Groundwater Banking
SFPUC LEVEL OF SERVICE GOAL IS
<20% CUTBACKS
•
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
15 www.cityofpaloalto.org
May 12 –UAC Review and Recommendation to Council
June 14 –Council Review and Adoption
June 21 –Resolution finalized
June 30 –Deadline to file with Department of Water Resources
2020 UWMP Adoption Schedule •
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
16 www.cityofpaloalto.org
Staff requests the Utilities Advisory Commission (UAC) recommend the City Council adopt:
A) Resolution approving the 2020 Urban Water Management Plan and
B) Resolution adopting the Water Shortage Contingency Plan
RECOMMENDED MOTION •
CITY OF
PALO ALTO
Questions
www.cityofpaloalto.org
City of Palo Alto (ID # 12176)
Utilities Advisory Commission Staff Report
Report Type: New Business Meeting Date: 5/12/2021
City of Palo Alto Page 1
Summary Title: Proposed Operating and Capital Budgets for the Utilities
Title: Staff Recommendation That the Utilities Advisory Commission
Recommend the City Council Adopt the Proposed Operating and Capital
Budgets for the Utilities Department for Fiscal Year 2022
From: City Manager
Lead Department: Utilities
Recommended Motion
Staff recommends the Utilities Advisory Commission recommend the City Council adopt the
Proposed Operating and Capital Budgets for the Utilities Department for Fiscal Year 2022.
Discussion
Attached are the FY 2022 Proposed Operating and Capital budgets for the Utilities Department.
Due to the number of pages of the CIP budget, staff only printed the CIP overview and five year
forecast of each utility for FY 2022– FY 2026.
The entire Utilities CIP budget for FY 2022 – FY 2026 with the individual project pages can be
downloaded and viewed in full from the link:
Proposed Utilities Capital Budget for FY 2022 - FY 2026
Attachments:
•Attachment A: FY 2022 Proposed Utilities Operating Budget
•Attachment B: FY 2022 Proposed Utilities Capital Budget Summary
•Attachment C: Presentation
Staff: Dave Yuan and Anna Vuong
ENTERPRISE FUNDS
OVERVIEW
CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 55
ENTERPRISE FUNDS OVERVIEWOverview
The City of Palo Alto’s Utility and Public Works operations are comprised of the Airport, Electric,
Fiber Optics, Gas, Refuse, Stormwater Management, Wastewater Collection, Wastewater Treatment,
and Water Funds. A financial summary of the funds follows this overview along with discussion and
pertinent information in each fund section.
REVENUES
The total budgeted revenue of the Enterprise Funds for FY 2022 is $383.7 million, which represents
a $13.8 million, or 3.5 percent decrease from the FY 2021 Adopted Budget of $397.5 million. The FAA
provides grants to public agencies for the planning and development of public-use airports and
reimburses up to 100 percent of the non-salary cost of eligible projects. Prior to FY 2021, FAA reim-
bursements were up to 90 percent for eligible projects. Utility services with rate increases for FY
2022 include Fiber Optics, Gas, Stormwater Management, and Wastewater. Electric, Water and
Refuse rates will remain the same for FY 2022. Details on these changes are discussed below. The
specific rate increase for each utility service is discussed below.
EXPENDITURES
The total budgeted expenditure of the Enterprise Funds for FY 2022 is $435.8 million, which rep-
resents a $5.3 million, or 1.2 percent decrease from the FY 2021 Adopted of $441.2 million. The pri-
mary driver for this year-over-year change is an decrease of $39.1 million in capital improvement
projects from $113.9 million in FY 2021 to $74.7 million in FY 2022. Utility purchase or commodity
costs is $166.1 million, which represents an increase of $12.3 million, or 12.3 percent, compared to
$153.8 million in FY 2021, due to lower usage forecasts and relatively steady market-based supply
costs.
UTILITY RATE CHANGES
The FY 2022 Adopted Budget includes utility rate adjustments for Fiber Optics, Gas, Stormwater
Management, and Wastewater. Due to the COVID-19 pandemic, Council aimed to provide economic
relief for residential and commercial customers by directing staff to keep rates flat without compro-
mising the safety and integrity of the utility systems and impacting service delivery. In general, the
size and timing of rate adjustments account for current and future revenue requirements to provide
customer service needs, plan for capital infrastructure investments, and maintain adequate reserve
levels. They may also smooth the impacts on customer bills by spreading larger rate adjustments
over consecutive or alternate years..
Attachment A
ENTERPRISE FUNDS OVERVIEW
56 • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
•Electric Fund - No rate adjustment is scheduled for FY 2022. The Electric Fund will draw down a
portion of the CIP and Operating reserves to fund continuing capital infrastructure improvements and
increasing transmission costs.
•Gas Fund - Scheduled rate increase is 3.0 percent due to increasing construction costs for gas main
replacements and continuation of the Crossbore Gas Safety Program.
•Water Fund - No rate adjustment is scheduled for FY 2022 due to no change in supply costs and
adequate reserves for the CIP.
•Wastewater Collection Fund - Scheduled rate increase is 3.0 percent for FY 2022 due to increasing
construction costs for main replacements, revenue loss due to COVID-19, and rehabilitation of the
Regional Water Quality Control Plant.
•Fiber Optics Fund - Scheduled rate increase is 2.0 percent, based on Consumer Price Index (CPI) for All
Urban Consumers in the San Francisco Bay Area, for customers on the EDF-1 rate.
•Stormwater Management Fund - Scheduled rate increase of 2.0 percent, based on CPI for All Urban
Consumers in the San Francisco Bay Area.
•Refuse Fund - No rate adjustment is scheduled for FY 2022 due to adequate reserves.
RENT
Enterprise Funds pay market-based rental fees to the General Fund for the sites needed to conduct their
business operations. Rent is adjusted on an annual basis consistent with CPI, 2.0 percent, based on CPI for
All Urban Consumers in the San Francisco Bay Area. Additionally, the Refuse Fund completed its final pay-
ment associated with the landfill post-closure agreement, reducing the rent paid by the Refuse fund by
$0.9 million. As a result of these actions, the net change to rent year-over-year in the Enterprise Funds is a
decrease of $0.7 million, or 7.0 percent, from $10.0 million to $9.3 million.
EQUITY TRANSFERS
In FY 2009, the City Council adopted a change to the methodology, beginning in FY 2010, used to calcu-
late the equity transfer from Utilities Funds to the General Fund. Under this methodology, the equity trans-
fers are based on the asset base in the Electric and Gas Funds, along with the rate of return for each utility,
which is based on Pacific Gas and Electric’s (PG&E) rate of return on equity as approved by the California
Public Utilities Commission (CPUC). For FY 2022, the equity transfers from the Electric and Gas Funds are
projected to increase by approximately $1.1 million, or 5.5 percent, from $20.6 million to $21.7 million.
RESERVES
The financial revenue and expense forecasts are estimates at a single point in time. Some Utilities reserves
serve as balancing accounts, which mitigate the risk of commodity price swings and insure against default
by the City’s wholesale suppliers. Other reserves are used to provide funding for capital infrastructure
improvement projects, replacement parts during an emergency infrastructure failure or serve as temporary
parking for planned expenditures. Reserve levels that are above guidelines are returned to customers in the
form of lower future rates or used to pay for expenses, which also result in lower future rates.
ENTERPRISE FUNDS OVERVIEW
• CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 57
Based on the actions included in this budget, the total Enterprise Fund Reserve Balances are projected to
end in FY 2022 at $73.5 million, decreasing by $52.1 million from a projected FY 2021 ending fund balance
of $125.5 million.
UTILITIES ENTERPRISE FUNDS
The City of Palo Alto Utilities (CPAU) had to rely on its reserves more heavily over the past few years to off-
set rate increases. In order for CPAU to cover its operating costs while maintaining and continuing to pro-
vide safe and reliable utility services to customers, rate increases are projected beyond FY 2022. Rate
increases will ensure CPAU has the ability to replenish depleted reserves and provide sufficient funding for
continued increasing expenses in commodity costs and repair and replacement of the City’s aging utility
infrastructure through various capital projects.
Electric
FY 2022 electric rates remain unchanged despite increasing transmission costs and substantial additional
capital investment in the aging electric distribution system. Electricity purchase costs have increased sub-
stantially as new renewable projects have come online to fulfill the City’s environmental goals and as trans-
mission costs continue to increase to make improvements to the California energy grid. Electric loads have
been gradually decreasing and are expected to continue to decrease in the long-term, mainly due to
declining consumption in the commercial sector, putting gradual upward pressure on rates. This decline
has been exacerbated by the COVID-19 pandemic. Consumption is currently 5% to 10% below long-term
consumption trends. Current models suggest that pandemic economic recovery will take place through
2021 and 2022, with electric consumption stabilizing on the long run average by 2023. Based on the rela-
tive health of the various Electric reserve funds, the City is recommending no rate increase for FY 2022,
however, this will likely result in reserves falling close to the minimum guideline levels over the next two to
three years.
Gas
FY 2022 gas rates are scheduled to increase by 3.0 percent due to increasing capital and operation costs.
In the short term, some increases in operations costs are related to the Crossbore Gas Safety Program, but
CIP costs have increased substantially as the City resumes a pattern of regular main replacement. The City
is replacing Polyvinyl Chloride (PVC) mains with Polyethylene (PE) mains. Some of the PVC mains are
approaching 50 years of service. According to industry data, PVC pipes have a higher leakage rate than PE
mains after 20 years of service due to potential disbandment of fittings and joints. The Gas CIP plan
includes a gas main replacement project of $7 to $9 million every other year to address the aging PVC
mains.
Water
FY 2022 water rates remain unchanged. The San Francisco Public Utilities Commission (SFPUC) is project-
ing no increases in water supply rates until FY 2023. Capital projects were delayed in FY 2021 leading to
lower capital costs than budgeted. Many of these deferred capital projects are anticipated to be completed
in FY 2022. CIP reserves was established in FY 2021 to complete these projects while holding rates steady
in future years.
ENTERPRISE FUNDS OVERVIEW
58 • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Wastewater Collection
FY 2022 wastewater collection rates are scheduled to increase by 3.0 percent. Capital and operating costs
are anticipated to increase for the wastewater collection system. In addition, CPAU anticipates treatment
costs to rise over the forecast period due to major rehabilitation and replacement of plant equipment that
have been in use for over 40 years at the Regional Water Quality Control Plant. A cost of service study was
completed in 2021. In FY 2022 residential customers will see a higher rate (~4.7%) increase than commercial
customers (~1.5%) in part of as a result of a re-balancing of costs between residential and non-residential
customers and in part because of the overall revenue increase needed to cover rising costs..
Fiber Optics
Fiber optics rates are scheduled to increase by 2.0 percent for customers on the EDF-1 rate schedule in FY
2022. CPAU provides commercial dark fiber optic services within the boundaries of the City. In September
2006, the City Council approved the Dark Fiber Licensing Agreement allowing the commercial fiber optic
fees charged under the EDF-1 rate schedule to be adjusted annually in accordance with CPI. EDF-1 was a
promotional rate and was closed to new dark fiber licenses in 2006. Customer expenses for engineering,
construction and connection to the fiber optic backbone are charged under the EDF-2 rates. New fiber
customers are enrolled under the Dark Fiber Licensing Services Rate Schedule EDF-3. As CPI increases are
implemented for the EDF-1 rate, some customers may voluntarily choose to move from the EDF-1 rate to
the EDF-3 rate for cost saving purposes.
PUBLIC WORKS ENTERPRISE FUNDS
Refuse
FY 2022 refuse rates remain unchanged. FY 2023 rates are projected to increase at a rate based on CPI.
Implementing initiatives from the 2018 Zero Waste Plan will continue to help the City make progress on its
Zero Waste Sustainability and Climate Action Plan (S/CAP) goals to divert 95.0 percent or more waste by
2030.
Stormwater Management
FY 2022 Stormwater Management Fee is scheduled to increase by 2.0 percent. The Stormwater Manage-
ment fee was approved by property owners through a ballot measure in April 2017. The projects and infra-
structure component of this fee sunsets June 1, 2032 unless extended through a subsequent ballot
measure. The Stormwater Management Fund maintains activities that ensure adequate drainage of the
City’s storm drainage system as well as litter reduction, green stormwater infrastructure projects, urban
pollution prevention programs, and flooding emergency response services.
Wastewater Treatment
The City’s Regional Water Quality Control Plant serves six communities including Palo Alto, East Palo Alto
Sanitary District, Mountain View, Stanford, Los Altos, and Los Altos Hills. The Wastewater Treatment Fund
works with the City and Partner Cities’ regional service area to protect the environment and the public’s
health while ensuring compliance with regulations protecting the San Francisco Bay. FY 2022 revenues in
the Wastewater Treatment Fund are expected to decrease by approximately $8.3 million, or 13.8 percent,
ENTERPRISE FUNDS OVERVIEW
• CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 59
compared to FY 2021. The majority of the decrease resulted from multiple capital improvement projects
being postponed to subsequent years and the consolidation of programmed funding sources and
expenses to the fiscal year that design and construction contracts are anticipated to be awarded in.
Airport
The City assumed airport operations from Santa Clara County in August 2014 for the Palo Alto Airport,
which ranks among the busiest general aviation airports in the country. The City entered into 1-3 year
interim leases in 2017 while the airport completed the Sustainable Airport Planning Update. These leases
were extended in 2020 for an additional three years due to FAA deferring funds for the Sustainable Airport
Business/Comprehensive Plan. These leases include a 3% annual increase in rent; however, as a result of the
pandemic, the Airport building revenues have been decreased by $41,000 due the closure of a business on
the field. All airport business tenants, except one, are current on rent payments. Tie-down revenue has also
decreased by $40,000 due to the pandemic and continuing construction on the Airport Apron resulting in
fewer tie-down accounts. The Airport cannot accept new tie-down accounts due to the construction but
has a waiting list for new accounts. The Apron Reconstruction Phase III project is scheduled to be com-
pleted in Fall 2021 at which point tie-downs will be available for rent once again, and revenue is projected
to return to normal or increase. The Airport’s fees and charges are scheduled to increase by 2.0 percent,
and the hangar revenue is expected to increase by $31,000. The Airport continues to pay down the General
Fund loans at $272,000 annually, and currently owes $2.6 million in principle.
ENTERPRISE FUNDS OVERVIEW
60 • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Enterprise Funds Summary
Fund Summary
($000)
Electric
Fund
Gas
Fund
Water
Fund
Refuse
Fund
Waste-
water
Treatment
Fund
Waste-
water
Collection
Fund
Storm-
water
Mmgt.
Fund
Airport
Fund
Fiber
Optics
Fund Total
Revenues
Charges for Services 220 20 10 34 — 10 81 —— 375
Charges to Other Funds 189 108 96 161 65 34 ——— 652
From Other Agencies —— 577 ———— 624 — 1,200
Net Sales 156,956 40,702 45,332 30,731 31,573 20,596 7,787 635 4,369 338,681
Operating Transfers-In 2,291 — 323 —————— 2,614
Other Revenue 8,918 913 304 2,311 19,905 152 — 1,116 200 33,819
Other Taxes and Fines ———— 4 — 3 —— 7
Rental Income ——————— 760 — 760
Return on Investments 2,084 622 989 489 316 244 153 5 647 5,549
Total 170,658 42,365 47,630 33,725 51,863 21,037 8,024 3,140 5,215 383,657
Expenses
Allocated Charges 10,598 5,256 5,205 2,022 6,173 3,051 1,242 736 725 35,007
Contract Services 8,054 1,386 800 6,738 3,574 249 915 215 471 22,401
Debt Service 8,072 803 3,223 — 1,469 129 949 —— 14,644
Equity Transfer 14,298 7,429 ——————— 21,727
Facilities & Equipment 16 2 1 3 8 3 8 —— 40
General Expense 5,113 898 695 112 493 169 150 36 12 7,679
Operating Transfers-Out — 161 — 21 14 161 6 273 102 738
Rents & Leases 6,490 620 3,441 134 — 357 25 12 55 11,133
Salary & Benefits 26,861 10,882 9,992 3,163 14,782 5,502 2,895 1,185 1,585 76,847
Supplies & Material 911 495 618 143 2,094 381 94 56 9 4,802
Transfer to Infrastructure ——— 27 ————— 27
Utility Purchase 96,512 18,031 21,409 18,970 — 11,154 ——— 166,076
Capital Improvement
Program
16,948 3,322 13,668 —30,365 3,543 5,663 759 346 74,614
Total 193,873 49,286 59,051 31,332 58,972 24,698 11,947 3,272 3,304 435,736I I
ENTERPRISE FUNDS OVERVIEW
• CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 61
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
$180,000
Electric Fund Gas Fund Water Fund Refuse Fund WW
Treatment
Fund
WW
Collection
Fund
Stormwater
Management
Fund
Airport Fund Fiber Optics
Fund
3 YEAR TREND ‐ENTERPRISE FUNDS REVENUES BY FUND ($THOUSANDS)
FY 2020 Actuals FY 2021 Adopted FY 2022 Proposed
Electric Fund
$170.7/44.5%Gas Fund $42.4/11%
Water Fund
$47.6/12.4%
Refuse Fund
$33.7/8.8%
WW Treatment Fund
$51.9/13.5%
WW Collection Fund
$21/5.5%
Stormwater Management
Fund $8/2.1%
Airport Fund $3.1/0.8%
Fiber Optics Fund
$5.2/1.4%
FY 2022 PROPOSED REVENUES/$383.7 MILLION
Il l Ill Ill 111 Ill • --•--A
I • • •
ENTERPRISE FUNDS OVERVIEW
62 • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
$180,000
Electric Fund Gas Fund Water Fund Refuse Fund WW
Treatment
Fund
WW
Collection
Fund
Stormwater
Management
Fund
Airport Fund Fiber Optics
Fund
3 YEAR TREND ‐ENTERPRISE FUNDS EXPENSES BY FUND ($THOUSANDS)
FY 2020 Actuals FY 2021 Adopted FY 2022 Proposed
Electric Fund
$173.6/44%Gas Fund $44.4/11.3%
Water Fund
$50.6/12.8%
Refuse Fund
$31.3/7.9%
WW Treatment Fund
$54.4/13.8%WW Collection Fund
$20.4/5.2%
Stormwater
Management Fund
$11.3/2.9%
Airport Fund $3.3/0.8%
Fiber Optics Fund
$5.2/1.3%
FY 2022 PROPOSED EXPENSES /$394.5 MILLION
Electric Fund
$193.9/44.5%Gas Fund $49.3/11.3%
Water Fund
$59.1/13.6%
Refuse Fund
$31.3/7.2%
WW Treatment Fund
$59/13.5%WW Collection Fund
$24.7/5.7%
Stormwater
Management Fund
$11.9/2.7%
Airport Fund $3.3/0.8%
Fiber Optics Fund
$3.3/0.8%
FY 2022 PROPOSED EXPENSES /$435.7 MILLION
Ill lh Ill 111 Ill -·· ••----
I • • •
ENTERPRISE FUNDS OVERVIEW
• CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 63
Enterprise Fund Reserves
Reserves ($000)FY 2021
Projected
Ending
Balance
FY 2022
Changes
Projected FY
2022
Projected
Ending
Balance
FY 2022
Reserve
Guideline
Range
Electric Fund
Operations 48,784 (7,955)40,829 31,900-63,700
Hydro Stabilization 15,400 (8,000)7,400
Electric Special Projects 46,664 0 46,664
Low Carbon Fuel Standard 6,340 (2,260)4,080
Public Benefit 1,905 0 1,905
Underground Loan 727 0 727
CIP Reserves 5,880 (5,000)880
GASB 68 Pension Reserve (33,747)0 (33,747)
GASB 75 OPEB Reserve (13,741)0 (13,741)
Subtotal 78,212 (23,215)54,997
Gas Fund
Rate Stabilization 8,420 (8,420)0
Operations 16,735 (1,001)15,735 8,100-16,200
CIP Reserves 3,820 2,500 6,320
GASB 68 Pension Reserve (14,851)0 (14,851)
GASB 75 OPEB Reserve (6,058)0 (6,058)
Subtotal 8,066 (6,921)1,146
Wastewater Collection Fund
Rate Stabilization 342 0 342
Operations 7,861 (2,683)5,178 4,100-10,100
CIP Reserves 978 (978)0
GASB 68 Pension Reserve (8,319)0 (8,319)
GASB 75 OPEB Reserve (2,316)0 (2,316)
ENTERPRISE FUNDS OVERVIEW
64 • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Subtotal (1,454)(3,661)(5,115)
Water Fun d
Rate Stabilization 9,069 0 9,069
Operations 26,608 (13,421)13,187 9,700-19,400
CIP Reserves 5,726 2,000 7,726
GASB 68 Pension Reserve (14,114)0 (14,114)
GASB 75 OPEB Reserve (4,215)0 (4,215)
Subtotal 23,074 (11,421)11,653
Refuse Fund
Rate Stabilization 9,386 2,393 11,779 5,200-10,300
Landfill Corrective Action
Reserve
771 0 771
Geng Road Reserve 268 0 268
GASB 68 Pension Reserve (5,775)0 (5,775)
GASB 75 OPEB Reserve (2,576)0 (2,576)
Subtotal 2,074 2,393 4,467
Stormwater Management Fund
Rate Stabilization 6,822 (3,923)2,899
CIP Reserves 0 0 0
GASB 68 Pension Reserve (3,829)0 (3,829)
GASB 75 OPEB Reserve (1,129)0 (1,129)
Subtotal 1,864 (3,923)-2,059
Wastewater Treatment Fund
Rate Stabilization 9,253 (7,109)2,144 9,700-19,400
Enterprise Fund Reserves
Reserves ($000)FY 2021
Projected
Ending
Balance
FY 2022
Changes
Projected FY
2022
Projected
Ending
Balance
FY 2022
Reserve
Guideline
Range
ENTERPRISE FUNDS OVERVIEW
• CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 65
Emergency Plant
Replacement
1,980 0 1,980
Notes and loans 1,651 0 1,651
CIP Reserves 0 0 0
GASB 68 Pension Reserve (21,125)0 (21,125)
GASB 75 OPEB Reserve (7,158)0 (7,158)
Subtotal (15,399)(7,109)(22,508)
Fiber Optics Fund
Rate Stabilization 34,999 1,911 36,911 500-1,100
Emergency Plant
Replacement
1,000 0 1,000
CIP Reserves 0 0 0
GASB 68 Pension Reserve (2,154)0 (2,154)
GASB 75 OPEB Reserve 0 0 0
Subtotal 33,845 1,911 35,757
Airport Fund
Rate Stabilization (3,434)(135)(3,569)
CIP Reserves 0 0 0
GASB 68 Pension Reserve (894)0 (894)
GASB 75 OPEB Reserve (420)0 (420)
Subtotal (4,748)(135)(4,883)
TOTAL RESERVES 125,534 (52,081)73,453
Summary of Reserves
Emergency Plant
Replacement
2,980 0 2,980
Hydro Stabilization 15,400 (8,000)7,400
Enterprise Fund Reserves
Reserves ($000)FY 2021
Projected
Ending
Balance
FY 2022
Changes
Projected FY
2022
Projected
Ending
Balance
FY 2022
Reserve
Guideline
Range
ENTERPRISE FUNDS OVERVIEW
66 • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Rate Stabilization 74,857 (15,283)59,574
Operations 99,988 (25,059)74,929
CIP Reserves 16,404 (1,478)14,926
Geng Road Reserve 268 0 268
Electric Special Projects 46,664 0 46,664
Low Carbon Fuel Standard 6,340 (2,260)4,080
Public Benefit 1,905 0 1,905
Notes and loans 1,651 0 1,651
Underground Loan 727 0 727
Landfill Corrective Action
Reserve
771 0 771
GASB 68 Pension Reserve (104,808)0 (104,808)
GASB 75 OPEB Reserve (937,613)0 (37,613)
TOTAL RESERVES 125,534 (52,081)73,453
Landfill Postclosure Care
Liability
6,975 0 6,975
TOTAL RESERVES AND
FULLY-FUNDED LIABILITY
132,509 (52,081)80,428
Enterprise Fund Reserves
Reserves ($000)FY 2021
Projected
Ending
Balance
FY 2022
Changes
Projected FY
2022
Projected
Ending
Balance
FY 2022
Reserve
Guideline
Range
ENTERPRISE FUNDS OVERVIEW
• CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 67
Average Projected Residential Monthly Utility
Bills
Adjusted FY
2021 Bill
Proposed FY
2022 Bill
$ Difference % Difference
Electric 57.31 57.31 -0.00%
Gas 57.44 59.58 2.14 3.73%
Water 90.42 90.42 -0.00%
Wastewater 41.37 43.32 1.95 4.71%
Refuse 50.07 50.07 -0.00%
Storm Drain 15.04 15.34 0.30 1.99%
User Tax 10.26 10.37 0.11 1.07%
Total Monthly Bill 321.91 326.41 4.50 1.40%
*FY 2022 Rates are effective July 1, 2021.
Proposed FY 2022 rate change is the system average change. Customers in each customer class will
experience different rate impacts than the overall rate increase.
UTILITIES
CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 329
Utilities
UTILITIESMission Statement
The City of Palo Alto Utilities’ mission is
to provide safe, reliable, environmentally
sustainable, and cost-effective services.
Purpose
The purpose of the City of Palo Alto Utilities
is to provide high quality, cost-effective elec-
tric, gas, fiber optics, water and wastewater
collection services; promote effective energy
and water efficiency programs; proactively
manage infrastructure needs and replace
deteriorated or aging facilities with new
technologies to ensure safe and reliable
delivery of services; and ensure the City’s
utilities are in sound financial condition.
UTILITIES
330 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
CUSTOMER SUPPORT SERVICES
1.00 Assistant Director Utilities
Customer Support Services
2.00 Credit and Collections Specialist
2.00 Customer Service Specialist-Lead
7.00 Customer Service Representative
2.00 Customer Service Specialist
1.00 Manager Customer Service
1.00 Manager, Utilities Credit and
Collections
6.00 Meter Reader
1.00 Meter Reader-Lead
UTILITIES DIRECTOR
Dean Batchelor
ELECTRIC ENGINEERING & OPERATIONS
2.00 Administrative Associate II
1.00 Assistant Director Utilities
(OHFWULFDQG)LEHU
1.00 Business Analyst
1.00 Coordinator Utilities Projects
3.00 Electrician Assistant I
1.00 Electric Equipment Technician
2.00 Electric Heavy Equipment Operator
4.00 Electric Project Engineer
2.00 Electric Underground Inspectors
1.00 Electric Underground Inspector-Lead
1.00 Engineering Manager – Electric
.00 Engineer Technician III
10.00 Lineperson / Cable Splicer
.00 Lineperson / Cable Splicer-Lead
1.00 Manager Electric Operations
3.00 Metering Technician
1.00 Metering Technician- Lead
2.00 Overhead/Underground Troubleman
1.00 Power Engineer
2.00 SCADA Technologist
.00 Senior Electrical Engineer
5.00 Street Light, Traffic Signal &
Fiber Technician
2.00 Street Light, Traffic Signal & Fiber
Technician-Lead
6.00 Substation Electrician
2.00 Substation Electrician-Lead
3.00 Utilities Comp Tech
1.00 Utilities Comp Tech-Lead
3.00 Utilities Engineer Estimator
1.00 Utilities Engineer Estimator-Lead
3.00 Utilities Locator
6.00 Utilities Supervisor
5.00 Utilities System Operator
RESOURCE MANAGEMENT
1.00 Assistant Director,
Resource Management
1.00 Administrative Associate II
1.00 Business Analyst
3.00 Key Account Representative
1.00 Manager, Utility Program Services
4.00 6XVWDLQDELOLW\ Program
Administrator
1.00 Program Assistant II
5.00 Resource Planner
.5Senior Resource Planner
UTILITIES ADMINISTRATION
1.00 Administrative Assistant
1.00 Administrative Associate II
2.00 Business Analyst
1.00 Chief Operating Officer
1.00 Compliance Manager
1.00 Coordinator, Utilities Projects
1.00 Manager Communications
1.00 Manager Utilities Telecom
1.00 Principal Business Analyst
0.50 Program Assistant
6DIHW\2IILFHU
3.00 Senior Business Analyst
1.00 Senior Resource Planner
1.00 Strategic Business Manager
WGW ENGINEERING &OPERATIONS
2.00 Administrative Associate II
1.00 Assistant Director Utilities :*:
2.00 Business Analyst
1.00 Cathodic Protection Tech-Asst
1.00 Cathodic Technician
2.00 Cement Finisher
4.00 Coordinator Utilities Projects
4.00 Engineer
1.00 Engineering Manager – WGW
(QJLQHHULQJ7HFKQLFLDQ,,,
1.00 Gas & Water Meter Measurement and
Control Technician - Lead
4.00 Gas & Water Meter Measurement and
Control Technician
4.00 Heavy Equipment Operator / Installer
Repairer
,QVSHFWRU)LHOG6HUYLFHV
2.00 Maintenance Mechanic Welding
1.00 Manager WGW Operations
1.00 Program Assistant
5.00 Project Engineer
1.00 Restoration Lead
5.00 Senior Project Engineer
1.00 Senior Mechanic
1.00 Senior Utilities Field Service Rep
2.00 Senior Water System Operator
2.00 Utilities Engineer Estimator
5.00 Utilities Field Service Rep
1.00 Utilities Installer/Repairer
8WLOLWLHV,QVWDOOHU5HSDLUHU$VVLVWDQW
5.00 Utilities Install/Rep-Lead
3.00 Utilities Install/Rep-Welding
2.00 Utilities Install/Rep-Welding-Lead
6.00 Utilities Supervisor
4.00 Water Systems Operator II
5.00 WGW Heavy Equipment Operator
FY 202 POSITION TOTALS
245.0- Full-time
- Hourly
This organizational chart represents
citywide Full-Time Equivalents (FTEs)
for this department. The
Department Summary tables summarize
FTEs by position allocation.
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 331
Description
The City of Palo Alto offers a full array of utility services to its citizens and
businesses. Because of this, the City has a unique opportunity to partner with the
Palo Alto community to enjoy the benefits and achievements of reliable, home-
grown, and environmentally-focused utilities. Palo Alto has a tradition of over 100
years of successful public utility operations. It is a tradition that continues to
provide the Palo Alto community with safe and reliable utilities service, local
decision-making over policies, utility rate-making, environmental programs, and
customized services.
The City of Palo Alto Utilities (CPAU) continues to focus on customer service,
infrastructure reliability, regulatory compliance, and cost containment. CPAU also
supports the City’s sustainability goals by building a low-carbon energy supply
through the use of renewable energy and offsets and by promoting programs to
help customers use energy and water more efficiently, reduce their carbon
footprint, and help them integrate new technologies.
At CPAU, our people empower tomorrow’s ambitions while caring for today’s
needs. We make this possible with our outstanding professional workforce,
leading through collaboration, and optimizing resources to ensure a sustainable
and resilient Palo Alto.
ADMINISTRATION
Utilities Administration is responsible for the overall management of the CPAU including communication,
regulatory compliance, strategic planning, budget coordination, legislation and regulatory policy analysis,
and personnel and administrative support to the entire Department.
CUSTOMER SUPPORT SERVICES
Customer Support Services annually bills $250 million for the City’s electric, natural gas, water, commercial
fiber optic, wastewater collection (operated by CPAU), storm drain, and refuse (operated by Public Works)
services; operates the Customer Service Call Center with 75,000 annual customer interactions; reads
90,000 utility meters per month; and implements Credit and Collection policies and financial assistance
programs.
UTILITIES
332 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
ENGINEERING
Engineering is responsible for managing all phases of CPAU’s capital improvement projects which include
providing new or upgrading existing service to customers and replacing and rehabilitating the City’s elec-
tric, fiber, gas, water, and wastewater distribution systems.
OPERATIONS
Utilities Operations is responsible for the operations, maintenance, and emergency response for the elec-
tric, fiber, gas, water, and wastewater distribution systems.
RESOURCE MANAGEMENT
Resource Management is responsible for the long-term resource acquisition plan for, electricity, natural gas,
and water; contract negotiations to acquire renewable resources; financial planning; rate development;
energy efficiency and water conservation programs; and management of key accounts.
Key Performance Measures
COMPARABLE AND COST-EFFECTIVE SERVICES
Goal Ensure fiscally sound and cost-effective services.
Objective Reduce the cost of delivering services through best management practices.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Palo Alto’s average residential
monthly utility bill above/below the
median of neighboring cities
(9)%(10)%(10)%(16)%(10)%
Description This compares the average residential monthly utility bill which includes electricity, gas,
water, and wastewater services to the nearby communities (Menlo Park $347, Mountain
View $268, Santa Clara $204, Hayward $261, Redwood City $327).
Purpose This measure compares the City’s average utility rates charged to residents to other
comparable cities (e.g., similar size, similar commodity purchase options, similar geography).
Status The monthly average residential utility bill in fiscal year 2021 for Palo Alto was lower
compared to the nearby communities described above. Palo Alto’s monthly average
residential utility bill was $236, and for all the communities combined the average was $281.
Electric rates were significantly lower than PGE and slightly higher than Santa Clara. Natural
gas rates were lower due to PGE’s increased distribution rates for capital improvement and
maintenance. Water rates were higher primarily due to differing system characteristics, levels
of infrastructure investment, and sources of supply. Palo Alto’s water supply comes from the
San Francisco Public Utilities Commission (SFPUC), which is undergoing a $4.8 billion
improvement project, and Palo Alto is also investing more than other communities in
improving our local distribution pipelines and enhancing our emergency water supply
system.
CUSTOMER SATISFACTION
Goal Provide excellent customer service.
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 333
Objective Maintain a high level of customer satisfaction, equal to or greater than 83 percent of Palo
Alto citizens rating satisfaction of utility services as "Excellent" or "Good" in the National
Citizen Survey.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Percent rating services (electric,
gas, wastewater, and water)
"Good" or Excellent"
N/A*83%N/A*86%N/A*
Description The National Citizen Survey (NCS) is a collaborative effort between National Research
Center, Inc. (NRC) and the International City/County Management Association (ICMA). The
NCS was developed by NRC to provide a statistically valid survey of opinions about
community and services provided by local governments. There are ten California
communities participating in the survey.
Purpose To get feedback on whether customers are satisfied with the nature, extent and delivery of
services provided, using random-selection survey processes that include a good cross-
section of the customer base.
Status In FY 2020 a total of 768 surveys were obtained, providing an overall response rate of 22
percent. In FY 2021, Utilities scored similar or lower compared to FY 2018. Both Electric and
Gas experienced a 6 percentage point decrease. Overall, Utilities has met its target of 83
percent and anticipates this continuing through FY 2022.
* The National Citizen's Survey was transitioned from the City Auditor's Office to the Office of
the City Manager as part of the FY 2021 Adopted Budget. As a result of this transition the
survey was not completed for FY 2019. The survey was completed for FY 2018 and FY
2020; therefore, FY 2019 actual results are not available and are reflected by “N/A.” This FY
2022 Proposed Budget recommends that the frequency of this survey be adjusted to every
other year, to be completed on odd numbered fiscal years. Therefore, FY 2022, this
projected data is also reflected by “N/A.” The next survey is proposed to take place in FY
2023.
Workload Measures
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Total cost of Capital Improvement
Program annually (Millions)
$35.42 $25.10 $47.40 $43.00 $50.10
Key Performance Measures
UTILITIES
334 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Budget Summary
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change $
FY 2022
Change %
Dollars by Fund
Electric Fund $158,278,458 $160,455,124 $183,401,646 $193,873,413 $10,471,767 5.7%
Fiber Optics Fund $2,885,744 $3,066,203 $4,345,287 $3,304,292 $(1,040,994)(24.0)%
Gas Fund $43,544,118 $36,041,196 $48,705,920 $49,285,528 $579,608 1.2%
Wastewater Collection Fund $18,415,551 $22,293,857 $23,897,257 $24,697,553 $800,296 3.3%
Water Fund $43,711,111 $46,791,689 $57,456,171 $59,051,016 $1,594,845 2.8%
Total $266,834,982 $268,648,070 $317,806,281 $330,211,802 $12,405,521 3.9%
Revenues
Charges for Services $509,624 $1,139,896 $260,000 $260,000 —0.0%
Charges to Other Funds $470,943 $723,458 $374,310 $426,267 $51,957 13.9%
From Other Agencies $488,052 $473,073 $576,632 $576,632 —0.0%
Net Sales $264,444,785 $269,781,464 $253,293,473 $267,955,063 $14,661,591 5.8%
Operating Transfers-In $3,873,979 $3,130,514 $3,202,109 $2,613,966 $(588,143)(18.4)%
Other Revenue $11,348,937 $10,383,895 $11,620,946 $10,487,250 $(1,133,696)(9.8)%
Rental Income $10,000 $20,000 ———0.0%
Return on Investments $4,908,650 $4,858,696 $4,565,900 $4,585,900 $20,000 0.4%
Total $286,054,970 $290,510,997 $273,893,370 $286,905,078 $13,011,709 4.8%
Positions by Fund
Electric Fund 111.33 110.95 111.34 113.58 2.24 2.0%
Fiber Optics Fund 7.60 7.50 7.10 6.90 (0.20)(2.8)%
Gas Fund 53.83 53.83 53.83 53.57 (0.26)(0.5)%
Utilities Administration Fund 19.21 19.46 19.46 19.46 ——%
Wastewater Collection Fund 29.16 29.16 28.50 27.50 (1.00)(3.5)%
Water Fund 46.92 46.94 47.61 46.83 (0.78)(1.6)%
Total 268.05 267.84 267.84 267.84 ——%
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 335
ELECTRIC FUND
Description
On January 16, 1900, the City of Palo Alto began operation of its own electric
system. A steam engine was the initial source of the City’s electricity and was
replaced by a diesel engine in 1914. As demand for electricity and the population
continued to grow, the City of Palo Alto Utilities (CPAU) connected to the Pacific
Gas and Electric distribution system and purchased power from additional
sources.
The integrity of the infrastructure required for achieving a high level of reliability
and value for customers is of paramount importance to CPAU. The Electric Fund
strives to enhance the customer service connection experience, increase energy
efficiency participation, and increase the percentage of electric supply obtained
from renewable energy supplies. The City has entered into a number of contracts
with producers of wind, landfill gas, and solar energy for more than 15-year terms.
Key Performance Measures
ENVIRONMENTAL SUSTAINABILITY
Goal Support environmental sustainability and promote efficient use of resources.
Objective Achieve Renewable Portfolio Standard (RPS) of at least 50 percent by 2030.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Percent of retail electric sales
volume provided by renewable
supply resources under long-term
PPAs
61%37%35%25%44%
Description This measures the fraction of the City’s retail electric sales volume that is provided by
renewable supply resources that are under long-term agreement.
Purpose The Clean Energy and Pollution Reduction Act (SB 350) of 2015 raised the state’s renewable
portfolio standard (RPS) to 50 percent by 2030 and required a doubling of energy efficiency
savings by 2030.
UTILITIES
336 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Status The City sold Bucket 1 RECs in Q1-Q4 FY 2020 accordingly, which caused the City’s RPS
levels to drop for FY 2020 (from the levels in FY 2019 and other previous years), but the City
still remains in compliance with its RPS requirements. Under the updated Carbon Neutral
Plan that was approved by Palo Alto City Council in August 2020, the City was authorized to
sell all Bucket 1 RECs exceeding the amount required to comply with the City’s RPS
requirements, and to replace them with Bucket 3 REC purchases. RPS compliance is based
on aggregate RPS procurement over the entire compliance period (2017-2020), which
ensures that the City is still in compliance with the state RPS requirements.
ENVIRONMENTAL SUSTAINABILITY - SOLAR
Goal Support environmental sustainability and promote efficient use of resources.
Objective Increase the penetration of local solar installations.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Cumulative installed capacity of
photovoltaic (PV) systems
measured in megawatts (MW)
13 16 14 16 17
Description This represents the cumulative installed capacity of PV systems in Palo Alto, measured in
MW. It includes PV systems installed prior to the passage of California Senate Bill 1 (SB1),
which enacted the Million Solar Roofs Initiative and expands upon the current California
Solar Initiative (CSI) and the Energy Commission’s New Solar Homes Partnership (NSHP).
Purpose This measure supports the City’s goal of achieving a 100 percent carbon neutral electric
supply portfolio, meeting 4 percent of the City’s electricity needs through local solar by 2023,
and complying with California Senate Bill 1 (SB1) to increase PV installations. Increasing the
cumulative installed capacity of PV systems will also benefit the environment and expand the
flexibility of the City’s electric generation portfolio.
Status At of the end of FY 2021, a cumulative 1,179 PV installations since CPAU began supporting
local solar PV installations in 1999. These customer-side generation systems are not
included in CPAU’s Renewable Portfolio Standard (RPS) supply requirements.
SYSTEM RELIABILITY
Goal Provide safe and efficient delivery of electric services to customers.
Objective Provide exceptional system reliability.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Average duration of customer
outages in minutes as reported
using industry guidelines
122 65 60 95 60
Description System Average Interruptible Duration Index (SAIDI) is a measure of outage duration. It
measures the number of minutes over the year that the average customer is without power.
Key Performance Measures
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 337
Purpose Reliability indices were introduced in order to keep track of utility performance. This
information will help Utilities prioritize capital and operating spending so that reliability can be
improved without increasing costs.
Status The goal to attain 60 minutes or less in overall response time to restore outages was
impacted in FY 2021 due to staffing vacancies and abnormally stormy weather causing a
cluster of outages that resulted in longer response times. The Electric Utility had 18
sustained outages as of April 2021, affecting a range of customers from 6 to 9,092
customers. Based on the April outages, the FY 2021 total estimated outages are 22. Of the
18 outages, 12 were storm related and 6 non-storm. The non-storm outages were attributed
to various types of equipment failure throughout the distribution system.
Workload Measures
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Number of Customer Accounts
(Electric)
29,600 29,791 29,834 29,790 29,800
Number of momentary outages 1 1 1 1 1
Percent of residents surveyed who
rate the quality of the Electric Utility
as “Good” or “Excellent”%
N/A*77%N/A*80%N/A*
Total Number of Outages 42 32 27 22 28
* The National Citizen's Survey was transitioned from the City Auditor's Office to the Office of the City Manager as part of the FY
2021 Adopted Budget. As a result of this transition the survey was not completed for FY 2019. The survey was completed for FY
2018 and FY 2020; therefore, FY 2019 actual results are not available and are reflected by “N/A.” This FY 2022 Proposed Budget
recommends that the frequency of this survey be adjusted to every other year, to be completed on odd numbered fiscal years.
Therefore, FY 2022, this projected data is also reflected by “N/A.” The next survey is proposed to take place in FY 2023.
Key Performance Measures
UTILITIES
338 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Budget Summary
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change $
FY 2022
Change %
Dollars by Division
CIP Electric Fund $15,615,817 $13,250,146 $27,308,142 $23,314,150 $(3,993,992)(14.6)%
Electric Administration $23,218,636 $25,609,423 $27,202,398 $29,069,053 $1,866,655 6.9%
Electric Customer Service $2,306,400 $2,759,969 $2,682,485 $3,015,078 $332,594 12.4%
Electric Demand Side
Management
$3,716,457 $2,760,278 $7,052,872 $7,105,699 $52,827 0.7%
Electric Engineering
(Operating)
$1,843,389 $2,055,894 $2,482,242 $2,602,207 $119,966 4.8%
Electric Operations and
Maintenance
$11,606,585 $13,453,944 $17,008,182 $18,106,326 $1,098,144 6.5%
Electric Resource
Management
$99,971,173 $100,565,471 $99,665,325 $110,660,900 $10,995,575 11.0%
Total $158,278,458 $160,455,124 $183,401,646 $193,873,414 $10,471,768 5.7%
Salary & Benefits
Healthcare $1,820,670 $1,820,588 $2,330,631 $2,613,352 $282,721 12.1%
Other Benefits $318,143 $364,169 $455,345 $482,340 $26,995 5.9%
Overtime $1,017,707 $922,569 $531,386 $545,202 $13,816 2.6%
Pension $3,214,302 $5,309,308 $5,296,009 $5,783,592 $487,583 9.2%
Retiree Medical $1,555,185 $1,601,840 $1,532,993 $1,558,060 $25,066 1.6%
Salary $10,846,696 $12,323,907 $14,884,804 $15,333,762 $448,958 3.0%
Workers’ Compensation $292,351 $592,660 $409,199 $545,061 $135,862 33.2%
Total Salary and Benefits $19,065,053 $22,935,042 $25,440,367 $26,861,370 $1,421,002 5.6%
Dollars by Category
Utility Purchase $89,680,963 $90,791,122 $88,084,000 $96,512,497 $8,428,497 9.6%
Contract Services $2,786,957 $2,844,281 $6,377,366 $8,053,741 $1,676,375 26.3%
Supplies & Material $533,907 $752,739 $924,207 $911,207 $(13,000)(1.4)%
General Expense $2,258,230 $1,337,087 $3,441,967 $5,113,267 $1,671,300 48.6%
Rents & Leases $5,784,139 $6,074,342 $6,389,015 $6,490,030 $101,015 1.6%
Debt Service $8,368,513 $7,074,261 $8,442,678 $8,071,519 $(371,159)(4.4)%
Facilities & Equipment $18,379 $19,138 $27,300 $16,000 $(11,300)(41.4)%
Allocated Charges $4,253,400 $4,725,823 $9,416,874 $10,597,643 $1,180,769 12.5%
Transfer to Infrastructure $199,167 ———$0 0.0%
Operating Transfers-Out $297,973 $772,326 $50,000 —$(50,000)(100.0)%
Equity Transfer $12,973,000 $13,134,000 $13,479,000 $14,298,000 $819,000 6.1%
Capital Improvement Program $12,058,775 $9,994,964 $21,328,871 $16,948,141 $(4,380,730)(20.5)%
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 339
Total Dollars by Expense
Category
$158,278,458 $160,455,124 $183,401,646 $193,873,414 $10,471,768 5.7%
Revenues
Charges for Services $375,880 $1,028,157 $220,000 $220,000 $0 0.0%
Charges to Other Funds $193,480 $257,370 $145,401 $188,523 $43,122 29.7%
Net Sales $154,155,483 $160,169,216 $145,996,103 $156,956,327 $10,960,224 7.5%
Operating Transfers-In $3,334,701 $2,582,378 $2,644,849 $2,291,326 $(353,523)(13.4)%
Other Revenue $8,797,973 $7,894,326 $8,918,000 $8,918,000 $0 0.0%
Rental Income $10,000 $20,000 ——$0 0.0%
Return on Investments $2,431,950 $2,336,327 $2,063,800 $2,083,800 $20,000 1.0%
Total Revenues $169,299,467 $174,287,773 $159,988,153 $170,657,976 $10,669,823 6.7%
Positions by Division
CIP Electric Fund 31.90 31.90 24.35 25.61 1.26 5.2%
Electric Customer Service 12.00 11.90 11.90 11.90 0.00 0.0%
Electric Demand Side
Management
6.17 5.59 5.59 5.64 0.05 0.9%
Electric Engineering
(Operating)
4.98 4.98 6.67 6.67 0.00 0.0%
Electric Operations and
Maintenance
48.10 48.10 54.35 54.59 0.24 0.4%
Electric Resource
Management
8.18 8.48 8.48 9.17 0.69 8.1%
Total 111.33 110.95 111.34 113.58 2.24 2.0%
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
Account Specialist 0.31 0.31 0.31 0.31 —$24,264
Administrative Associate II 3.90 3.30 3.30 3.30 —$258,704
Assistant Director
Administrative Services
0.20 0.20 0.20 0.20 —$36,462
Assistant Director Utilities
Customer Support Services
0.40 0.40 0.40 0.40 —$81,178
Assistant Director Utilities
Engineering
0.40 0.40 —0.40 0.40 $86,969
Budget Summary
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change $
FY 2022
Change %
UTILITIES
340 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Assistant Director Utilities
Engineering (Freeze)
——0.40 —(0.40)—
Assistant Director Utilities
Operations
0.60 0.60 0.60 0.60 —$136,307
Assistant Director Utilities/
Resource Management
0.50 0.50 0.50 0.55 0.05 $114,892
Business Analyst 1.60 1.60 1.35 2.10 0.75 $326,203
Business Analyst (Freeze)——0.25 —(0.25)—
Contracts Administrator 0.10 0.10 0.10 0.10 —$11,529
Coordinator Utilities Projects 1.55 1.55 1.55 1.55 —$148,385
Customer Service
Representative
1.87 1.87 1.87 1.87 —$145,277
Customer Service Specialist 0.66 0.66 0.66 0.66 —$56,381
Customer Service Specialist-
Lead
0.58 0.58 0.58 0.58 —$52,985
Electric Heavy Equipment
Operator
——2.00 2.00 —$217,318
Electric Project Engineer 1.95 3.25 3.65 3.65 —$580,788
Electric Underground
Inspector
2.00 2.00 2.00 2.00 —$228,883
Electric Underground
Inspector-Lead
1.00 1.00 1.00 1.00 —$122,387
Electrical Equipment
Technician
1.00 1.00 1.00 1.00 —$116,958
Electrician Assistant I 3.00 3.00 3.00 3.00 —$272,563
Engineering Manager - Electric 0.55 0.55 0.55 0.55 —$118,244
Engineering Technician III 1.40 1.40 1.40 1.40 —$137,971
Heavy Equipment Operator 2.00 2.00 ————
Inspector, Field Services 0.25 0.25 0.25 0.25 —$26,577
Lineperson/Cable Specialist 11.00 11.00 10.00 10.00 —$1,574,352
Lineperson/Cable Specialist-
Lead
4.00 4.00 4.00 4.00 —$673,837
Manager Customer Service 0.33 0.33 0.33 0.33 —$52,070
Manager Electric Operations 1.00 1.00 1.00 1.00 —$192,546
Manager Treasury, Debt &
Investments
0.30 0.30 0.30 0.30 —$46,513
Manager Utilities Compliance 0.15 0.15 0.15 0.15 —$29,531
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 341
Manager Utilities Credit &
Collection
0.15 0.15 0.15 0.15 —$23,902
Manager Utilities Program
Services
0.40 0.40 0.40 0.40 —$60,669
Meter Reader 1.99 1.99 1.99 1.99 —$145,286
Meter Reader-Lead 0.33 0.33 0.33 0.33 —$25,781
Metering Technician 3.00 3.00 3.00 3.00 —$409,157
Metering Technician-Lead 1.00 1.00 1.00 1.00 —$145,974
Offset Equipment Operator 0.48 0.48 0.48 0.48 —$33,426
Overhead Underground
Troubleman
2.00 2.00 2.00 2.00 —$330,720
Power Engineer 2.30 1.00 1.00 1.00 —$150,030
Principal Business Analyst 0.34 0.34 0.34 0.34 —$62,064
Program Assistant II —0.60 0.60 0.50 (0.10)$42,744
Project Manager 0.75 0.75 0.75 0.75 —$81,806
Resource Planner 3.65 2.85 2.85 2.80 (0.05)$401,914
SCADA Technologist 1.00 1.00 1.01 1.01 —$154,031
Senior Business Analyst 1.02 1.02 1.02 1.02 —$161,921
Senior Electrical Engineer 3.95 3.95 3.95 4.95 1.00 $958,770
Senior Management Analyst 0.10 0.10 0.10 0.10 —$12,881
Senior Resource Planner 3.06 3.36 3.36 3.45 0.09 $611,440
Senior Utilities Field Service
Representative
0.10 0.10 0.10 0.10 —$11,588
Street Light, Traffic Signal &
Fiber Technician
3.00 3.00 3.00 3.00 —$391,310
Street Light, Traffic Signal &
Fiber-Lead
1.00 1.00 1.00 1.00 —$139,610
Substation Electrician 5.50 5.50 4.50 5.50 1.00 $782,839
Substation Electrician (Freeze)——1.00 —(1.00)—
Substation Electrician-Lead 2.00 2.00 2.00 2.00 —$304,595
Supervising Electric Project
Engineer
1.00 1.00 1.00 —(1.00)—
Sustainability Programs
Administrator
———2.95 2.95 $342,266
Tree Maintenance Person 1.00 1.00 1.00 1.00 —$88,150
Utilities Compliance
Technician
2.00 2.00 3.00 3.00 —$472,306
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
342 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Utilities Compliance
Technician-Lead
1.00 1.00 1.00 1.00 —$168,459
Utilities Credit/Collection
Specialist
2.00 2.00 2.00 2.00 —$201,469
Utilities Engineer Estimator 3.25 3.25 3.23 3.23 —$422,605
Utilities Field Services
Representative
0.50 0.50 0.50 0.50 —$54,184
Utilities Key Account
Representative
1.35 1.35 1.35 1.35 —$162,106
Utilities Locator 1.95 1.95 1.95 1.95 —$203,652
Utilities Marketing Program
Administrator
1.90 2.70 2.70 —(2.70)—
Utilities Safety Officer 0.55 0.55 0.55 0.55 —$69,841
Utilities Supervisor 5.00 5.00 5.00 6.50 1.50 $1,087,070
Utilities System Operator 5.00 5.00 5.00 5.00 —$881,400
Utility Engineering Estimator -
Lead
1.00 1.00 1.00 1.00 —$141,336
Subtotal: Full-Time
Equivalent Positions
107.22 107.52 107.91 110.15 2.24 $15,607,378
Temporary/Hourly 4.11 3.43 3.43 3.43 —$312,580
Total Positions 111.33 110.95 111.34 113.58 2.24 $15,919,958
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 343
Budget Reconciliation
Positions Expenditures Revenues
Net
General Fund
Prior Year Budget 111.34 183,401,646 159,988,153 23,413,493
One-time Prior Year Budget Adjustments
Electric Vehicle Chargers and Location Study (50,000)-(50,000)
FY 2021 Management and Professionals Group
Compensation Reduction
20,043 -20,043
Staffing Resource Reduction 633,944 -633,944
One-time Prior Year Budget Adjustments 0.00 603,987 0 603,987
Adjustments to Costs of Ongoing Activities
Salary and Benefits Adjustments 906,109 -906,109
FY 2021 Staffing Freeze Eliminations (CMR 11872)(1.65)(339,107)-(339,107)
Electric Customer Sales Revenue (0% Rate Change)-8,724,614 (8,724,614)
Return on Investments -20,000 (20,000)
Transfer from the General Fund (Traffic Signal and
Streetlight Electric Costs)
-(62,844)62,844
Electrification Programs (230,625)(230,625)
Rents & Leases Expenditure Alignment 101,015 -101,015
Utility Payment Processing 189,000 (14,951)203,951
Transfer from the Water and Gas Fund (EL-11014 Smart
Grid Installation)
-(272,670)272,670
Contract Services (Overhead Line Maintenance)515,000 -515,000
Low Carbon Fuel Standards (LCFS) Program 0.25 2,573,000 1,842,000 731,000
Equity Transfer to the General Fund 819,000 -819,000
Surplus Energy Revenue -(2,565,000)2,565,000
Electric Commodity Purchase Adjustments 8,057,338 3,005,474 5,051,864
Capital Improvement Program (4,380,730)-(4,380,730)
General Fund Cost Allocation Plan 916,696 -916,696
Grounds Maintenance Allocated Charges 643 -643
General Liability Insurance Allocated Charges 72,147 -72,147
Print & Mail Allocated Charges 33,125 -33,125
Utilities Administration Allocated Charges Adjustment 138,938 -138,938
Public Works Allocated Charges 1,488 -1,488
Vehicle Replacement & Maintenance Charges 17,732 -17,732
Workers’ Compensation Allocated Charges 135,862 -135,862
Adjustments to Costs of Ongoing Activities (1.40)9,526,630 10,676,623 (1,149,993)
UTILITIES
344 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Total FY 2022 Base Budget 109.94 193,532,263 170,664,776 22,867,487
Budget Proposals
1. Reclassification of Supervising Electrical Project
Engineer to Senior Electric Engineer
---
2. Restore Positions from FY 2021 Staffing Freeze
Eliminations
2.15 ---
3. Citywide Facility Closures - Internal City Services -(6,800)6,800
4. Staffing Reallocations for S/CAP and Electrification 0.49 118,360 -118,360
5. Staffing Reallocation of Utilities Supervisor Position 1.00 222,791 -222,791
Budget Changes 3.64 340,880 (6,800)347,680
Total FY 2022 Proposed Budget 113.58 193,873,414 170,657,976 23,215,438
Budget Adjustments
Budget Adjustments Positions Expenditures Revenues
Net
General Fund
1. Reclassification of Supervising Electrical Project
Engineer to Senior Electric Engineer
0.00 ---
This action reclassifies 1.0 FTE Supervising Electrical Project Engineer (SEPE) to 1.00 FTE Senior Electric Engineer (SEE) in the
Electrical Engineering (EE) group, and offsets some of those costs with anticipated reductions in training and travel expenses to provide
increased supervisory level responsibility for major electrical design engineering projects such as the foothills rebuild for fire mitigation
and fiber network expansion. In FY 2020, the EE group completed an evaluation of work priorities and hours, determining a staffing
level of 6.0 FTE SEE and 6.0 FTE EE was needed to implement infrastructure replacement, safe and reliable electric service, customer
service, resilience, and electrification goals. (Ongoing costs: $0)
Performance Results
Reclassifying a Supervising Electrical Project Engineer (SEPE) to a Senior Electrical Engineer (SEE) will increase the supervisory
experience to oversee emerging/existing electric priorities such as the fiber network expansion project for economic recovery, the
foothills rebuild for fire mitigation, and EV charger infrastructure projects for S/CAP implementation.
2. Restore Positions from FY 2021 Staffing Freeze
Eliminations
2.15 ---
This action restores 5.00 previously frozen positions in the Utilities Department (2.15 FTE in the Electric Fund) and offsets costs with
vacancy savings. In FY 2021, a total of 5.00 FTE positions were recommended to be frozen and defunded to provide high-cost savings
at relatively low risk for one to two years, including 1.00 Utilities Chief Operating Officer, 1.00 Assistant Director Utilities Engineering,
1.00 Utilities Supervisor, 1.00 Substation Electrician, and 1.00 Business Analyst. In the FY 2021 recommendation, the Utilities
Department noted that issues may arise if positions were held vacant for more than two years as staffing needs may change to meet
emerging priorities. This action restores these positions and offsets costs with salary reductions equivalent to holding the same
vacancy level. (Ongoing costs: $475,000)
Performance Results
Budget Reconciliation
Positions Expenditures Revenues
Net
General Fund
00
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 345
This action contributes to cost containment strategies in FY 2022. Restoring these positions will help with the strategic organizational
restructuring plans and implementation of programs such as Advanced Metering Infrastructure (AMI), Electrification and Fiber-to-the-
Home. The use of vacancy savings to offset expenses will have no service delivery impact.
3. Citywide Facility Closures - Internal City Services 0.00 -(6,800)6,800
This one-time action recognizes a reduction of internal City services associated with the closure of City facilities. Custodial and utilities
services for the Baylands Interpretive Center and the neighborhood library branches (Childrens, College Terrace, and Downtown) will
be reduced as these facilities will be closed to the public. Minimal utilities will be maintained at the facilities in order to preserve the
integrity of the facilities and allow for staff to work in the buildings on a limited basis, as needed. (Ongoing savings: $0)
Performance Results
This action contributes to cost containment strategies in FY 2022.
4. Staffing Reallocations for S/CAP and Electrification 0.49 118,360 -118,360
This action reallocates staffing resources (net 0.49 FTE) to the Electric Fund to support the City’s S/CAP and electrification plans. The
Utilities Department evaluate their workplan annually and adjust FTE distribution among shared positions as priorities change. These
changes include expanding responsibilities to implement the City’s S/CAP and cover electric and gas administrative needs. The electric
portfolio has become more complex, taking up more time on electric supply and demand management and less to other utilities. This
action will reduce 0.53 FTE in Water, 0.20 FTE in Fiber; and increase 0.24 FTE in Gas, and 0.49 FTE in Electric, totaling an increase of
$118,360 to the Electric Fund FY 2022 operating budget. (Ongoing costs: $122,340)
Performance Results
Reallocating these positions will support the City’s S/CAP, electric vehicle infrastructure and electrification plans.
5. Staffing Reallocation of Utilities Supervisor Position 1.00 222,791 -222,791
This action reallocates 1.0 FTE Utilities Supervisor from Water/Gas/Wastewater (WGW) Operations to Electric Operations. This will
increase Electric Fund expenses by approximately $223,000 and decrease Wastewater Collection Fund expenses by the same amount
for a net zero change within the department. Due to growing demands for Electric line work, Electric needs at the supervisory level
have increased. The impact from this recommendation will be minimal to the WGW group, which will continue to have sufficient
supervisor level oversight to absorb the reallocation and help reduce the backlog of electric work triggered by line work demands.
(Ongoing costs: $230,000)
Performance Results
Reallocating a Utilities Supervisor from Water/Gas/Wastewater (WGW) Operations to Electric Operations will increase electric line
construction supervisory experience to oversee increasing electric line inspection and oversight of contract construction work. This
action will be little to no impact for WGW operations.
Budget Adjustments
Budget Adjustments Positions Expenditures Revenues
Net
General Fund
0
0
UTILITIES
346 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
FIBER OPTICS FUND
Description
In 1996, the City built a dark fiber ring around Palo Alto capable of supporting
multiple network developers and service providers with significant growth
potential. The fiber backbone network was routed to pass by and provide access
to key City facilities and the Palo Alto business community, including research
centers and commercial properties.
Dark fiber optics service consists of providing the fiber optics cabling, splice
points, service connections, and other infrastructure providing high-capacity
bandwidth needed to transport large quantities of data. This service excludes the
transmitters, receivers, and data itself, which are owned and operated by each
customer.
Key Performance Measures
CUSTOMER SATISFACTION
Goal Provide excellent customer service.
Objective Provide high-quality and competitively-priced fiber optic utility services to City departments
and commercial customers in the City of Palo Alto.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Number of commercial fiber
connections completed
207 201 219 181 182
Description This measure shows the growth of the Fiber Enterprise based on customers and
connections. Estimates are based on analyzing the number of upcoming developments,
anticipating how many customers would sign on for Fiber, and taking into account how
many existing connections may result in disconnections such as companies leaving. Some
customers may also have multiple fiber connections at various locations.
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 347
Purpose The purpose of this measure is to add value to companies doing business in Palo Alto by
providing a cost-effective, world class telecommunications system. The goal is to build out
and fully leverage the fiber network to add value to the business and other communities as
needed.
Status The Fiber enterprise continues to build out the network to provide more service options to
our ever expanding customer base. These expansions will also help provide fiber access to
previously unserved areas, for example, the fiber network currently under construction for
the Palo Alto Unified School District will not only serve the schools, but provide fiber access
to surrounding areas.
Workload Measures
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Number of Customer Accounts
(Fiber)
96 95 100 83 88
Number of Wholesale re-sellers 14 15 15 15 15
Key Performance Measures
UTILITIES
348 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Budget Summary
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change $
FY 2022
Change %
Dollars by Division
CIP Fiber Optics Fund $791,530 $585,453 $1,509,517 $434,947 $(1,074,570)(71.2)%
Fiber Optics Administration $205,681 $243,174 $897,311 $861,088 $(36,222)(4.0)%
Fiber Optics Customer Service $633,076 $711,980 $1,232,615 $1,285,945 $53,330 4.3%
Fiber Optics Operations and
Maintenance
$1,255,457 $1,525,597 $705,843 $722,312 $16,469 2.3%
Total $2,885,744 $3,066,203 $4,345,287 $3,304,292 $(1,040,994)(24.0)%
Salary & Benefits
Healthcare $152,237 $151,002 $138,139 $163,883 $25,744 18.6%
Other Benefits $23,681 $28,769 $33,590 $33,711 $120 0.4%
Overtime $20,229 $36,669 $26,184 $26,865 $681 2.6%
Pension $247,607 $398,554 $327,788 $345,445 $17,657 5.4%
Salary $884,605 $988,766 $984,062 $977,380 $(6,682)(0.7)%
Workers’ Compensation $19,047 $41,272 $28,690 $38,216 $9,526 33.2%
Total Salary and Benefits $1,347,406 $1,645,032 $1,538,453 $1,585,499 $47,046 3.1%
Dollars by Category
Contract Services $173,912 $113,338 $454,646 $470,646 $16,000 3.5%
Supplies & Material $1,661 $9,169 $9,000 $9,000 —0.0%
General Expense $2,125 $2,789 $12,000 $12,000 —0.0%
Rents & Leases $77,787 $80,821 $53,531 $54,539 $1,008 1.9%
Facilities & Equipment $1,224 $1,275 ———0.0%
Allocated Charges $412,690 $537,896 $756,042 $724,778 $(31,264)(4.1)%
Transfer to Infrastructure $15,218 ————0.0%
Operating Transfers-Out $123,557 $162,353 $102,176 $102,176 —0.0%
Capital Improvement Program $730,163 $513,530 $1,419,438 $345,655 $(1,073,784)(75.6)%
Total Dollars by Expense
Category
$2,885,744 $3,066,203 $4,345,287 $3,304,292 $(1,040,994)(24.0)%
Revenues
Charges for Services $26,712 $24,038 ———0.0%
Charges to Other Funds —$65,000 ———0.0%
Net Sales $4,566,484 $4,483,752 $4,716,421 $4,368,722 $(347,699)(7.4)%
Other Revenue $163 $235 $200,000 $200,000 —0.0%
Return on Investments $683,895 $714,944 $646,700 $646,700 $0 0.0%
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 349
Total Revenues $5,277,254 $5,287,969 $5,563,121 $5,215,422 $(347,699)(6.3)%
Positions by Division
CIP Fiber Optics Fund 0.79 0.79 0.39 0.39 0.00 0.0%
Fiber Optics Customer Service 3.68 3.58 3.58 3.38 (0.20)(5.6)%
Fiber Optics Operations and
Maintenance
3.13 3.13 3.13 3.13 0.00 0.0%
Total 7.60 7.50 7.10 6.90 (0.20)(2.8)%
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
Administrative Associate II 0.20 0.20 0.20 0.20 —$15,679
Assistant Director Utilities
Customer Support Services
0.20 0.20 0.20 0.20 —$40,589
Assistant Director Utilities
Engineering
0.05 0.05 —0.05 0.05 $10,871
Assistant Director Utilities
Engineering (Freeze)
——0.05 —(0.05)—
Business Analyst 0.30 0.30 0.30 0.10 (0.20)$15,533
Electric Project Engineer 0.05 0.45 0.05 0.05 —$7,956
Manager Utilities Compliance 0.10 0.10 0.10 0.10 —$19,687
Manager Utilities Credit &
Collection
0.40 0.40 0.40 0.40 —$63,740
Manager Utilities Program
Services
0.20 0.20 0.20 0.20 —$30,335
Manager Utilities
Telecommunications
1.00 1.00 1.00 1.00 —$154,586
Power Engineer 0.40 —————
Senior Electrical Engineer 0.05 0.05 0.05 0.05 —$9,637
Street Light, Traffic Signal &
Fiber Technician
2.00 2.00 2.00 2.00 —$260,874
Street Light, Traffic Signal &
Fiber-Lead
1.00 1.00 1.00 1.00 —$139,610
Utilities Key Account
Representative
0.80 0.80 0.80 0.80 —$96,063
Utilities Locator 0.03 0.03 0.03 0.03 —$3,133
Budget Summary
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change $
FY 2022
Change %
UTILITIES
350 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Subtotal: Full-Time
Equivalent Positions
6.78 6.78 6.38 6.18 (0.20)$868,291
Temporary/Hourly 0.82 0.72 0.72 0.72 —$75,259
Total Positions 7.60 7.50 7.10 6.90 (0.20)$943,551
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 351
Budget Reconciliation
Positions Expenditures Revenues
Net
General Fund
Prior Year Budget 7.10 4,345,287 5,563,121 (1,217,834)
One-Time Prior Year Budget Adjustments
Staffing Resource Reduction 15,107 15,107
One-Time Prior Year Budget Adjustments 7.10 4,360,394 5,563,121 15,107
Adjustments to Costs of Ongoing Activities
Salary and Benefits Adjustments 14,835 -14,835
FY 2021 Staffing Freeze Eliminations (CMR 11872)(0.05)15,051 15,051
Fiber Optics Revenue 0 (347,699)347,699
Other Contract Expenses 16,000 -16,000
Rents & Leases Expenditure Alignment 1,008 -1,008
Return on Investments 0 --
Capital Improvement Program (1,073,784)-(1,073,784)
General Fund Cost Allocation Plan (29,721)-(29,721)
Liability Insurance Allocated Charges 5,966 -5,966
Utilities Administration Allocated Charges (7,509)-(7,509)
Workers’ Compensation Allocated Charges 9,526 -9,526
Adjustments to Costs of Ongoing Activities (0.05)(1,048,630)(347,699)(700,930)
Total FY 2022 Base Budget 7.05 3,311,764 5,215,422 (1,918,765)
Budget Proposals
1. Staffing Reallocations for S/CAP and Electrification (0.20)(41,472)-(41,472)
2. Communications Staffing and Programming 0.00 34,000 -34,000
3. Restore Positions from FY 2021 Staffing Freeze
Eliminations
0.05 ---
Budget Changes (0.15)(7,472)-(7,472)
Total FY 2022 Proposed Budget 6.90 3,304,292 5,215,422 (1,926,237)
Budget Adjustments
Budget Adjustments Positions Expenditures Revenues
Net
General Fund
1. Staffing Reallocations for S/CAP and Electrification (0.20)(41,472)-(41,472)I I I I
UTILITIES
352 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
This action reallocates staffing resources (net 0.20 FTE) from Fiber Fund to the Electric Fund to support the City’s S/CAP and
electrification plans. The Utilities Department evaluate their workplan annually and adjust FTE distribution among shared positions as
priorities change. These changes include expanding responsibilities to implement the City’s S/CAP and cover electric and gas
administrative needs. The electric portfolio has become more complex, taking up more time on electric supply and demand
management and less to other utilities. This action will reduce 0.53 FTE in Water, 0.20 FTE in Fiber; and increase 0.24 FTE in Gas, and
0.49 FTE in Electric, totaling an increase of $118,360 to the Electric Fund FY 2022 operating budget. (Ongoing savings: $42,700)
Performance Results
Reallocating these positions will support the City’s S/CAP, electric vehicle infrastructure and electrification plans.
2. Communications Staffing and Programming 0.00 34,000 -34,000
This action increases resources for communications programming, contract expense, and staffing levels. This actions recognizes
expenses equivalent to underfilling the Communications Manager position at a lower level ( e.g. Management Analyst level) in order to
balance the need to lower the General Fund cost of services while still working to achieve current Council priorities for engagement for
key projects approved, such as but not limited to the Fiber to the Home Initiative, as part of the Community and Economic Recovery
workplan. With this focus, a portion of the position is recommended to be reallocated from the City Manager’s Office to the Fiber Fund
as well for the implementation of the Fiber to the Home initiative. (Ongoing costs: $34,000)
Performance Results
This action contributes to cost containment strategies in FY 2022.
3. Restore Positions from FY 2021 Staffing Freeze
Eliminations
0.05 ---
This action restores 5.00 previously frozen positions in the Utilities Department (0.05 FTE in the Fiber Fund) and offsets costs with
vacancy savings. In FY 2021, a total of 5.00 FTE positions were recommended to be frozen and defunded to provide high-cost savings
at relatively low risk for one to two years, including 1.00 Utilities Chief Operating Officer, 1.00 Assistant Director Utilities Engineering,
1.00 Utilities Supervisor, 1.00 Substation Electrician, and 1.00 Business Analyst. In the FY 2021 recommendation, the Utilities
Department noted that issues may arise if positions were held vacant for more than two years as staffing needs may change to meet
emerging priorities. This action restores these positions and offsets costs with salary reductions equivalent to holding the same
vacancy level. Ongoing costs: $15,500)
Performance Results
This action contributes to cost containment strategies in FY 2022. Restoring these positions will help with the strategic organizational
restructuring plans and implementation of programs such as Advanced Metering Infrastructure (AMI), Electrification and Fiber-to-the-
Home. The use of vacancy savings to offset expenses will have no service delivery impact.
Budget Adjustments
Budget Adjustments Positions Expenditures Revenues
Net
General Fund
00
0
00
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 353
GAS FUND
Description
The municipal natural gas system began operations in 1917 when Palo Alto
acquired a privately-owned gas business. During the early years, gas was
manufactured from coal tar. This was replaced in the 1920s by natural gas from
Pacific Gas and Electric. Today, gas is purchased from several sources. The Gas
Utility services include Crossbore Safety, Gas Main Replacements, and Home
Energy Audits. The Gas utility infrastructure and its crews maintain an excellent
safety record. The gas fund is responsible for planning, designing, budgeting, and
constructing major capital improvements to the City’s gas distribution system.
Key Performance Measures
GAS LEAKS REPAIRED
Goal Provide safe and efficient delivery of natural gas to customers.
Objective Respond to and repair all Grade 1 gas leaks immediately.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Percentage of Grade 1 leaks
responded to within 24 hours
100%100%100%100%100%
Description This measures the total response time to Grade 1 leaks found during the walking and mobile
(vehicle) surveys and any reported leaks classified as Grade 1. The City’s policy is to respond
and repair Grade 1 leaks within 24 hours. Grade 1 leaks are hazardous leaks that pose an
immediate hazard to persons or property and require continuous action until conditions are
no longer hazardous.
Purpose Leaks are assigned priority gradings according to location, extent of migration, gas
concentration, potential for concentration, ignition sources, and potential hazard to the
public and property. These priority grades are intended only as guidelines.
Status Utilities Operations responds immediately to Grade 1 leaks. The average repair time can vary
depending on the size and location of the gas leak.
GAS SAFETY
Goal Provide safe and efficient delivery of natural gas to our customers.
UTILITIES
354 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Objective Complete a walking gas leak survey for 50 percent of the City and a mobile gas leak survey
of services in business districts and 100 percent of the City’s gas mains on an annual basis.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Percentage of gas system surveyed
by mobile (vehicle)
100%100%100%100%100%
Percentage of gas system surveyed
by walking
100%100%100%100%100%
Description A walking survey is conducted to check for gas leaks on service/gas meters and covers
one-half of the City (approximately 105 miles of gas mains and 36 miles of service lines)
every year, so that the entire City’s gas service system can be reviewed in a two-year period.
The Federal Department of Transportation (DOT) regulations require a survey of the entire
City once every five years. In addition to a walking survey, a mobile (vehicle) survey of all gas
mains and some gas service lines (services in the business district) are conducted annually.
Purpose To ensure the safety of all who live and work in Palo Alto and to comply with Federal DOT
requirements.
Status The department is meeting the requirements and repairing all discovered gas leaks in a
timely manner.
INCREASE ENVIRONMENTAL SUSTAINABILITY AND PROMOTE EFFICIENT USE OF
NATURAL GAS RESOURCES
Goal Support environmental sustainability and promote efficient use of natural gas resources.
Objective Increase gas efficiency participation.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Natural gas savings achieved
annually through efficiency
programs (therms)
301,000 61,203 314,000 188,000 283,000
Description The department measures specific savings achieved from the installation of natural gas
efficiency improvements, which are tracked through energy efficiency incentive programs.
The Department can also track overall savings by customer class. Much of the non-
residential savings were achieved through third party contractors who help large customers
give their buildings a tune-up known as retrocommissioning.
Purpose The carbon intensity of the natural gas portfolio is a function of where and how the gas is
acquired and how much of it is burned in use. Improving gas efficiency directly reduces the
gas-related carbon footprint in Palo Alto.
Status The gas efficiency savings goal was last established in 2017. The decline in efficiency
savings are due to several reasons; declining gas load, delay in savings claimed from home
energy reports, and suspension in the Residential, Small Business, and Commercial and
Industrial programs due to restricted on-site visits as a result of COVID-19.
Key Performance Measures
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 355
Workload Measures
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Number of Customer Accounts
(Gas)
23,629 23,388 23,629 23,388 23,393
Number of gas leaks repaired 126 116 75 89 75
UTILITIES
356 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Budget Summary
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change $
FY 2022
Change %
Dollars by Division
CIP Gas Fund $9,145,930 $4,792,591 $9,283,062 $5,814,843 $(3,468,218)(37.4)%
Gas Administration $10,587,695 $11,259,621 $12,930,871 $13,421,182 $490,311 3.8%
Gas Customer Service $1,558,608 $1,873,711 $1,922,079 $2,081,145 $159,066 8.3%
Gas Demand Side
Management
$536,424 $550,164 $1,578,651 $1,534,524 $(44,127)(2.8)%
Gas Engineering (Operating)$400,087 $666,285 $613,019 $619,617 $6,598 1.1%
Gas Operations and
Maintenance
$4,957,368 $5,333,536 $7,538,469 $6,884,527 $(653,942)(8.7)%
Gas Resource Management $16,358,006 $11,565,288 $14,839,770 $18,929,690 $4,089,920 27.6%
Total $43,544,118 $36,041,196 $48,705,920 $49,285,528 $579,608 1.2%
Salary & Benefits
Healthcare $911,670 $932,202 $1,074,047 $1,162,457 $88,410 8.2%
Other Benefits $134,145 $148,073 $199,862 $208,888 $9,027 4.5%
Overtime $192,593 $211,699 $203,318 $208,604 $5,286 2.6%
Pension $1,428,625 $2,304,625 $2,125,769 $2,309,776 $184,007 8.7%
Retiree Medical $667,617 $687,645 $663,940 $674,796 $10,856 1.6%
Salary $4,384,864 $4,336,114 $5,928,585 $6,086,718 $158,133 2.7%
Workers’ Compensation $124,864 $251,034 $173,173 $230,670 $57,497 33.2%
Total Salary and Benefits $7,844,377 $8,871,393 $10,368,694 $10,881,910 $513,216 4.9%
Dollars by Category
Utility Purchase $15,957,533 $11,102,378 $14,051,296 $18,031,102 $3,979,806 28.3%
Contract Services $542,232 $785,800 $2,441,313 $1,386,313 $(1,055,000)(43.2)%
Supplies & Material $355,647 $304,614 $495,316 $495,316 —0.0%
General Expense $358,847 $296,353 $778,491 $897,991 $119,500 15.4%
Rents & Leases $757,276 $785,958 $610,121 $619,916 $9,795 1.6%
Debt Service $179,933 $155,636 $802,615 $802,615 —0.0%
Facilities & Equipment $8,570 $8,924 $1,840 $1,840 —0.0%
Allocated Charges $2,527,804 $2,774,599 $4,785,034 $5,256,073 $471,039 9.8%
Transfer to Infrastructure $84,833 ————0.0%
Operating Transfers-Out $713,892 $741,394 $414,965 $161,320 $(253,645)(61.1)%
Equity Transfer $6,601,000 $6,942,000 $7,114,000 $7,429,000 $315,000 4.4%
Capital Improvement Program $7,617,592 $3,272,147 $6,842,237 $3,322,133 $(3,520,104)(51.4)%
Total Dollars by Expense
Category
$43,544,118 $36,041,196 $48,705,920 $49,285,528 $579,608 1.2%
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 357
Revenues
Charges for Services $34,269 $23,685 $20,000 $20,000 —0.0%
Charges to Other Funds $111,459 $126,522 $105,529 $108,167 $2,638 2.5%
Net Sales $40,955,173 $36,343,849 $37,161,478 $40,702,046 $3,540,568 9.5%
Other Revenue $1,023,183 $931,433 $913,000 $913,000 —0.0%
Return on Investments $596,995 $578,171 $621,800 $621,800 —0.0%
Total Revenues $42,721,079 $38,003,661 $38,821,807 $42,365,013 $3,543,206 9.1%
Positions by Division
CIP Gas Fund 15.80 15.80 11.73 11.73 —0.0%
Gas Customer Service 9.13 9.03 9.03 9.03 —0.0%
Gas Demand Side
Management
1.54 1.54 1.54 1.28 (0.26)(16.2)%
Gas Engineering (Operating)1.40 1.40 1.85 1.85 —0.0%
Gas Operations and
Maintenance
24.30 24.30 27.92 27.68 (0.24)(0.9)%
Gas Resource Management 1.66 1.76 1.76 2.00 0.24 13.6%
Total 53.83 53.83 53.83 53.57 (0.26)(0.5)%
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
Account Specialist 0.23 0.23 0.23 0.23 —$18,002
Administrative Associate II 0.85 0.60 0.60 0.60 —$47,037
Assistant Director
Administrative Services
0.05 0.05 0.05 0.05 —$9,116
Assistant Director Utilities
Customer Support Services
0.20 0.20 0.20 0.20 —$40,589
Assistant Director Utilities
Engineering
0.20 0.20 ————
Assistant Director Utilities
Engineering (Freeze)
——0.20 0.20 —$43,484
Assistant Director Utilities
Operations
0.15 0.15 0.15 0.15 —$34,077
Assistant Director Utilities/
Resource Management
0.25 0.25 0.25 0.20 (0.05)$41,779
Budget Summary
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change $
FY 2022
Change %
UTILITIES
358 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Business Analyst 1.15 1.15 0.90 1.05 0.15 $163,102
Business Analyst (Freeze)——0.25 —(0.25)—
Cathodic Protection
Technician Assistant
1.00 1.00 1.00 1.00 —$106,621
Cathodic Technician 1.00 1.00 1.00 1.00 —$130,853
Cement Finisher 0.68 0.68 0.68 0.68 —$64,652
Contracts Administrator 0.10 0.10 0.10 0.10 —$11,529
Coordinator Utilities Projects 1.26 1.26 1.26 1.26 —$144,092
Customer Service
Representative
1.87 1.87 1.87 1.87 —$145,277
Customer Service Specialist 0.68 0.68 0.68 0.68 —$58,089
Customer Service Specialist-
Lead
0.58 0.58 0.58 0.58 —$52,985
Engineer 2.00 2.00 2.00 2.00 —$281,008
Engineering Manager - Electric 0.15 0.15 0.15 0.15 —$32,248
Engineering Manager - WGW 0.33 0.33 0.33 0.33 —$66,540
Engineering Technician III 0.70 0.70 0.70 0.70 —$68,985
Gas and Water Meter
Measurement and Control
Technician
3.20 3.20 3.40 3.40 —$345,326
Gas and Water Meter
Measurement and Control
Technician - Lead
0.80 0.80 0.80 0.80 —$86,944
Heavy Equipment Operator 2.52 2.52 ————
Heavy Equipment Operator -
Install/Repair
0.65 0.65 0.65 0.65 —$68,635
Inspector, Field Services 1.42 1.42 2.05 2.05 —$217,933
Maintenance Mechanic-
Welding
1.00 1.00 1.00 1.00 —$106,538
Manager Customer Service 0.33 0.33 0.33 0.33 —$52,070
Manager Treasury, Debt &
Investments
0.10 0.10 0.10 0.10 —$15,504
Manager Utilities Compliance 0.25 0.25 0.25 0.25 —$49,218
Manager Utilities Credit &
Collection
0.15 0.15 0.15 0.15 —$23,902
Manager Utilities Operations
WGW
0.20 0.20 0.20 0.20 —$37,041
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 359
Manager Utilities Program
Services
0.20 0.20 0.20 0.20 —$30,335
Meter Reader 1.98 1.98 1.98 1.98 —$144,556
Meter Reader-Lead 0.33 0.33 0.33 0.33 —$25,781
Principal Business Analyst 0.33 0.33 0.33 0.33 —$60,238
Program Assistant I 0.33 0.33 0.33 0.33 —$26,255
Program Assistant II —0.25 0.25 0.30 0.05 $25,646
Project Engineer 1.00 1.00 1.00 1.00 —$151,216
Resource Planner 0.65 0.45 0.45 0.70 0.25 $100,479
Restoration Lead 0.43 0.43 0.43 0.43 —$48,530
SCADA Technologist 0.20 0.20 0.10 0.10 —$15,251
Senior Business Analyst 0.99 0.99 0.99 0.99 —$157,158
Senior Engineer 2.70 2.70 2.35 2.35 —$400,449
Senior Mechanic 0.33 0.33 0.33 0.33 —$37,388
Senior Resource Planner 0.46 0.56 0.56 0.65 0.09 $116,421
Senior Utilities Field Service
Representative
0.41 0.41 0.41 0.41 —$47,509
Substation Electrician 0.10 0.10 0.25 0.25 —$35,584
Sustainability Programs
Administrator
———0.65 0.65 $75,415
Utilities Engineer Estimator 0.85 0.85 0.73 0.73 —$91,288
Utilities Field Services
Representative
1.75 1.75 1.75 1.75 —$189,644
Utilities Install Repair-Lead-
Welding Certified
1.30 1.30 0.77 0.77 —$90,859
Utilities Install Repair-Welding
Certified
1.95 1.95 1.43 1.43 —$141,077
Utilities Install/Repair 3.85 3.85 4.56 4.56 —$481,828
Utilities Install/Repair Assistant 0.65 0.65 0.65 0.65 —$58,244
Utilities Install/Repair-Lead 1.98 1.98 1.93 1.93 —$205,564
Utilities Key Account
Representative
0.50 0.50 0.50 0.50 —$60,039
Utilities Locator 0.29 0.29 0.29 0.29 —$30,287
Utilities Marketing Program
Administrator
0.70 0.90 0.90 —(0.90)—
Utilities Safety Officer 0.20 0.20 0.20 0.20 —$25,397
Utilities Supervisor 2.37 2.37 1.87 2.12 0.25 $322,355
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
360 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Utilities Supervisor (Freeze)——0.50 —(0.50)—
Water System Operator II 0.66 0.66 0.66 0.66 —$65,345
WGW Heavy Equipment
Operator
——2.50 2.50 —$263,484
Subtotal: Full-Time
Equivalent Positions
51.54 51.64 51.64 51.38 (0.26)$6,086,797
Temporary/Hourly 2.29 2.19 2.19 2.19 —$148,151
Total Positions 53.83 53.83 53.83 53.57 (0.26)$6,234,947
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 361
Budget Reconciliation
Positions Expenditures Revenues
Net
General Fund
Prior Year Budget 53.83 48,705,920 38,821,807 9,884,113
One-time Prior Year Budget Adjustments
Staffing Resource Reduction 219,298 -219,298
FY 2021 Management and Professionals Group
Compensation Reduction
3,685 -3,685
One-time Prior Year Budget Adjustments 0.00 222,983 0 222,983
Adjustments to Costs of Ongoing Activities
Salary and Benefits Adjustments (0.25)415,701 -415,701
FY 2021 Staffing Freeze Eliminations (CMR 11872)(0.95)(224,545)-(224,545)
Gas Customer Sales Revenue Adjustments (3% Rate
Increase)
-3,540,568 (3,540,568)
Crossbore Inspection Program (1,055,000)-(1,055,000)
Transfer to Water Fund (WS-02014 Water, Gas,
Wastewater Utility GIS Data)
(253,645)-(253,645)
Other Revenues -3,438 (3,438)
Rents & Leases Expenditure Alignment 9,795 -9,795
Other General Expenses 119,500 -119,500
Equity Transfer to the General Fund 315,000 -315,000
Gas Commodity Purchase Adjustments 3,979,806 3,979,806
Capital Improvement Program (3,520,104)-(3,520,104)
General Fund Cost Allocation Plan 427,877 -427,877
General Liability Insurance Allocated Charges 31,559 -31,559
Grounds Maintenance Allocated Charges 116 116
Printing & Mailing Allocated Charges 11,408 -11,408
Stormwater Management Allocated Charges (9)-(9)
Utilities Administration Allocated Charges Adjustment (8,698)-(8,698)
Vehicle Replacement & Maintenance Charges 8,785 -8,785
Workers’ Compensation Allocated Charges 57,497 -57,497
Adjustments to Costs of Ongoing Activities (1.20)315,044 3,544,006 (3,228,962)
Total FY 2022 Base Budget 52.63 49,243,947 42,365,813 6,878,135
Budget Proposals
1. Restore Positions from FY 2021 Staffing Freeze
Eliminations
0.70 ---
2. Staffing Reallocations for S/CAP and Electrification 0.24 41,581 -41,581
UTILITIES
362 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
3. Citywide Facility Closures - Internal City Services -(800)800
Budget Changes 0.94 41,581 (800)42,381
Total FY 2022 Proposed Budget 53.57 49,285,528 42,365,013 6,920,515
Budget Adjustments
Budget Adjustments Positions Expenditures Revenues
Net
General Fund
1. Restore Positions from FY 2021 Staffing Freeze
Eliminations
0.70 ---
This action restores 5.00 previously frozen positions in the Utilities Department (0.70 FTE in the Gas Fund) and offsets costs with
vacancy savings. In FY 2021, a total of 5.00 FTE positions were recommended to be frozen and defunded to provide high-cost savings
at relatively low risk for one to two years, including 1.00 Utilities Chief Operating Officer, 1.00 Assistant Director Utilities Engineering,
1.00 Utilities Supervisor, 1.00 Substation Electrician, and 1.00 Business Analyst. In the FY 2021 recommendation, the Utilities
Department noted that issues may arise if positions were held vacant for more than two years as staffing needs may change to meet
emerging priorities. This action restores these positions and offsets costs with salary reductions equivalent to holding the same
vacancy level. (Ongoing costs: $171,000)
Performance Results
This action contributes to cost containment strategies in FY 2022. Restoring these positions will help with the strategic organizational
restructuring plans and implementation of programs such as Advanced Metering Infrastructure (AMI), Electrification and Fiber-to-the-
Home. The use of vacancy savings to offset expenses will have no service delivery impact.
2. Staffing Reallocations for S/CAP and Electrification 0.24 41,581 -41,581
This action reallocates staffing resources (net 0.20 FTE) from Fiber Fund to the Electric Fund to support the City’s S/CAP and
electrification plans. The Utilities Department evaluate their workplan annually and adjust FTE distribution among shared positions as
priorities change. These changes include expanding responsibilities to implement the City’s S/CAP and cover electric and gas
administrative needs. The electric portfolio has become more complex, taking up more time on electric supply and demand
management and less to other utilities. This action will reduce 0.53 FTE in Water, 0.20 FTE in Fiber; and increase 0.24 FTE in Gas, and
0.49 FTE in Electric, totaling an increase of $118,360 to the Electric Fund FY 2022 operating budget. (Ongoing costs: $42,200)
Performance Results
Reallocating these positions will support the City’s S/CAP, electric vehicle infrastructure and electrification plans.
3. Citywide Facility Closures - Internal City Services --(800)800
This one-time action recognizes a reduction of internal City services associated with the closure of City facilities. Custodial and utilities
services for the Baylands Interpretive Center and the neighborhood library branches (Childrens, College Terrace, and Downtown) will
be reduced as these facilities will be closed to the public. Minimal utilities will be maintained at the facilities in order to preserve the
integrity of the facilities and allow for staff to work in the buildings on a limited basis, as needed. (Ongoing costs: $0)
Performance Results
This action contributes to cost containment strategies in FY 2022.
Budget Reconciliation
Positions Expenditures Revenues
Net
General Fund
00
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 363
WASTEWATER
COLLECTION FUND
Description
In 1898, Palo Alto approved $28,000 in bond money to fund construction of the
City’s first sewer network, which was completed in 1899. Private cesspools and
privies were banned, and the City Health Officer had residents connected to the
sewer system within a few years.
Wastewater Collection’s staff is responsible for design, construction, operation,
and maintenance of approximately 216 miles of sewer mains and over 18,000
City-owned laterals. Staff continues overlapping the design and construction
elements of rehabilitation and augmentation projects. Wastewater Collection’s
priorities are: maintaining infrastructure reliability; identifying problems in mains
and service laterals through expanded use of video technology; complying with
all regulatory requirements; and maintaining its excellent safety record.
Key Performance Measures
MAINTAIN AND PROVIDE RELIABLE SERVICES
Goal Maintain and provide a reliable wastewater system to customers.
Objective Clean and video a minimum of 17 percent of the City-owned laterals annually to comply with
the City’s Sewer Overflow Reduction Plan.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Percentage of sewer laterals
inspected annually
21%19%18%20%20%
UTILITIES
364 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Description The purpose of the Sewer System Management Plan (SSMP) is to maintain and improve the
condition of the collection system infrastructure; control infiltration and provide appropriate
sewer capacity; and minimize the number and impact of sanitary sewer overflows. The goal
is to perform sewer main cleaning of the entire collection system every 30 months (81.6
miles per year). This measures inspections and maintenance of 17 percent of City-owned
laterals annually using closed-circuit television (CCTV) inspection data, including results of
the on-going crossbore lateral inspection program, to target sewer mains and lower laterals
for rehabilitation and replacement.
Purpose To prevent blockage, sewer overflows, and to comply with the City’s SSMP, all the City’s
sewer mains must be cleaned within 30 months.
Status The City is meeting the objectives of its SSMP; through the implementation of an aggressive
sewer main cleaning, the number of blockages and overflows has decreased. The division is
on target to complete inspection of 19 percent, or 3,528, laterals of 18,141 in the City.
Workload Measures
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Number of Customer Accounts
(Wastewater)
22,599 27,663 22,010 22,700 22,700
Number of miles of sewer lines
cleaned/treated in a fiscal year
162 130 75 145 145
Percent of sewage spill responses
within two hours
98%98%100%100%100%
Percent of surveyed residents rating
the quality of the Sewer Service as
good/excellent
N/A*87%N/A*87%N/A*
Number of sewage overflows 67 60 60 40 40
Percent of miles of sewer lines
replaced
1.00%0.90%1.00%0.00%0.40%
* The National Citizen's Survey was transitioned from the City Auditor's Office to the Office of the City Manager as part of the FY
2021 Adopted Budget. As a result of this transition the survey was not completed for FY 2019. The survey was completed for FY
2018 and FY 2020; therefore, FY 2019 actual results are not available and are reflected by “N/A.” This FY 2022 Proposed Budget
recommends that the frequency of this survey be adjusted to every other year, to be completed on odd numbered fiscal years.
Therefore, FY 2022, this projected data is also reflected by “N/A.” The next survey is proposed to take place in FY 2023
Key Performance Measures
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 365
Budget Summary
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change $
FY 2022
Change %
Dollars by Division
CIP Wastewater Collection
Fund
$3,328,061 $5,420,422 $4,842,433 $5,629,985 $787,552 16.3%
Wastewater Collection
Administration
$1,755,355 $2,467,711 $2,914,040 $2,960,436 $46,395 1.6%
Wastewater Collection
Customer Service
$306,092 $366,154 $367,727 $440,686 $72,958 19.8%
Wastewater Collection
Engineering (Operating)
$328,587 $339,430 $425,122 $421,617 $(3,505)(0.8)%
Wastewater Collection
Operations and Maintenance
$12,697,456 $13,700,140 $15,347,934 $15,244,830 $(103,104)(0.7)%
Total $18,415,551 $22,293,857 $23,897,257 $24,697,553 $800,296 3.3%
Salary & Benefits
Healthcare $521,663 $526,938 $591,131 $641,342 $50,211 8.5%
Other Benefits $66,144 $76,320 $101,915 $98,500 $(3,415)(3.4)%
Overtime $200,097 $162,719 $158,939 $163,071 $4,132 2.6%
Pension $777,467 $1,253,764 $1,144,899 $1,192,850 $47,951 4.2%
Retiree Medical $259,629 $267,418 $256,185 $260,374 $4,189 1.6%
Salary $2,307,005 $3,011,194 $3,194,454 $3,016,537 $(177,917)(5.6)%
Workers’ Compensation $68,779 $140,115 $96,792 $128,928 $32,137 33.2%
Total Salary and Benefits $4,200,783 $5,438,468 $5,544,315 $5,501,603 $(42,712)(0.8)%
Dollars by Category
Utility Purchase $9,842,738 $10,233,626 $11,255,702 $11,153,615 $(102,087)(0.9)%
Contract Services $142,314 $186,469 $248,986 $248,986 —0.0%
Supplies & Material $236,250 $285,517 $380,618 $380,618 —0.0%
General Expense $91,013 $86,744 $122,900 $169,400 $46,500 37.8%
Rents & Leases $420,220 $435,982 $351,729 $356,790 $5,061 1.4%
Debt Service $33,560 $28,580 $129,001 $129,001 —0.0%
Facilities & Equipment $4,897 $5,099 $3,000 $3,000 —0.0%
Allocated Charges $925,975 $880,704 $2,863,022 $3,050,597 $187,574 6.6%
Transfer to Infrastructure $47,444 ————0.0%
Operating Transfers-Out $340,672 $467,350 $278,630 $161,320 $(117,310)(42.1)%
Capital Improvement Program $2,129,686 $4,245,316 $2,719,352 $3,542,623 $823,270 30.3%
Total Dollars by Expense
Category
$18,415,551 $22,293,857 $23,897,257 $24,697,553 $800,296 3.3%
UTILITIES
366 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Revenues
Charges for Services $21,253 $18,985 $10,000 $10,000 $0 0.0%
Charges to Other Funds $30,890 $44,871 $33,238 $34,069 $831 2.5%
Net Sales $20,129,208 $21,185,380 $21,415,012 $20,596,190 $(818,822)(3.8)%
Other Revenue $313,720 $190,542 $302,000 $152,000 $(150,000)(49.7)%
Return on Investments $201,076 $210,940 $244,400 $244,400 $0 0.0%
Total Revenues $20,696,146 $21,650,718 $22,004,650 $21,036,659 $(967,991)(4.4)%
Positions by Division
CIP Wastewater Collection
Fund
12.52 12.52 9.82 9.45 (0.37)(3.8)%
Wastewater Collection
Customer Service
2.22 2.22 2.22 2.22 —0.0%
Wastewater Collection
Engineering (Operating)
1.40 1.40 1.40 1.40 —0.0%
Wastewater Collection
Operations and Maintenance
13.02 13.02 15.06 14.43 (0.64)(4.2)%
Total 29.16 29.16 28.50 27.50 (1.00)(3.5)%
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
Account Specialist 0.23 0.23 0.23 0.23 —$18,002
Administrative Associate II 0.40 0.40 0.40 0.40 —$31,358
Assistant Director Utilities
Engineering
0.15 0.15 —0.15 0.15 $32,613
Assistant Director Utilities
Engineering (Freeze)
——0.15 —(0.15)—
Assistant Director Utilities
Operations
0.10 0.10 0.10 0.10 —$22,718
Business Analyst 0.75 0.75 0.50 0.75 0.25 $116,501
Business Analyst (Freeze)——0.25 —(0.25)—
Cement Finisher 0.76 0.76 0.76 0.76 —$72,258
Contracts Administrator 0.05 0.05 0.05 0.05 —$5,765
Coordinator Utilities Projects 1.10 1.10 1.10 1.10 —$125,794
Budget Summary
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change $
FY 2022
Change %
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 367
Customer Service
Representative
1.45 1.45 1.45 1.45 —$112,648
Customer Service Specialist-
Lead
0.25 0.25 0.25 0.25 —$22,838
Engineer 1.00 1.00 1.00 1.00 —$140,504
Engineering Manager - Electric 0.15 0.15 0.15 0.15 —$32,248
Engineering Manager - WGW 0.34 0.34 0.34 0.34 —$68,556
Engineering Technician III 0.45 0.45 0.45 0.45 —$44,348
Heavy Equipment Operator 0.23 0.23 ————
Heavy Equipment Operator -
Install/Repair
3.15 3.15 3.15 3.15 —$315,006
Industrial Waste Investigator 0.50 0.50 0.50 0.50 —$54,704
Inspector, Field Services 1.68 1.68 0.96 0.96 —$102,056
Maintenance Mechanic-
Welding
0.20 0.20 0.20 0.20 —$21,308
Manager Utilities Credit &
Collection
0.15 0.15 0.15 0.15 —$23,902
Manager Utilities Operations
WGW
0.30 0.30 0.30 0.30 —$55,561
Program Assistant I 0.34 0.34 0.34 0.34 —$27,050
Project Engineer 2.00 2.00 2.00 2.00 —$302,432
Restoration Lead 0.26 0.26 0.26 0.26 —$29,344
Senior Engineer 1.30 1.30 0.91 0.91 —$148,083
Senior Mechanic 0.33 0.33 0.33 0.33 —$37,388
Utilities Engineer Estimator 0.47 0.47 0.56 0.56 —$68,831
Utilities Field Services
Representative
1.25 1.25 1.25 1.25 —$135,460
Utilities Install Repair-Lead-
Welding Certified
0.24 0.24 0.58 0.58 —$68,439
Utilities Install Repair-Welding
Certified
0.36 0.36 0.63 0.63 —$67,816
Utilities Install/Repair 4.25 4.25 4.00 4.00 —$422,656
Utilities Install/Repair-Lead 2.00 2.00 2.00 2.00 —$230,589
Utilities Locator 0.39 0.39 0.39 0.39 —$40,730
Utilities Safety Officer 0.10 0.10 0.10 0.10 —$12,698
Utilities Supervisor 1.72 1.72 1.72 0.72 (1.00)$99,740
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
368 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
WGW Heavy Equipment
Operator
——0.23 0.23 —$24,241
Subtotal: Full-Time
Equivalent Positions
28.40 28.40 27.74 26.74 (1.00)$3,134,186
Temporary/Hourly 0.76 0.76 0.76 0.76 —$51,933
Total Positions 29.16 29.16 28.50 27.50 (1.00)$3,186,120
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 369
Budget Reconciliation
Positions Expenditures Revenues
Net
General Fund
Prior Year Budget 28.50 23,897,257 22,004,650 1,892,607
One-time Prior Year Budget Adjustments
Staffing Resource Reduction 90,474 -90,474
FY 2021 Management and Professionals Group
Compensation Reduction
842 -842
One-time Prior Year Budget Adjustments 0.00 91,316 0 91,316
Adjustments to Costs of Ongoing Activities
Salary and Benefits Adjustments 149,344 -149,344
FY 2021 Management and Professionals Group
Compensation Reduction
(0.40)(92,718)-(92,718)
Transfer to Water Fund (WS-02014 Water, Gas,
Wastewater Utility GIS Data)
(117,310)-(117,310)
Wastewater Collection Customer Sales Revenue -1,631 (1,631)
Rents & Leases Expenditure Alignment 5,061 -5,061
Utility Payment Processing 46,500 831 45,669
Other Revenues -(670,253)670,253
Return on Investments -(150,000)150,000
Capital Improvement Program 823,270 (150,000)973,270
General Fund Cost Allocation Plan 163,681 -163,681
Liability Insurance Allocated Charges 15,623 -15,623
Printing & Mailing Allocated Charges 2,426 -2,426
Refuse Allocated Charges 4,556 -4,556
Utilities Administration Allocated Charges (5,155)-(5,155)
Vehicle Replacement & Maintenance Allocated Charges 6,443 -6,443
Wastewater Treatment Allocated Charges (102,087)-(102,087)
Workers’ Compensation Allocated Charges 32,137 -32,137
Adjustments to Costs of Ongoing Activities (0.40)931,771 (967,791)1,899,562
Total FY 2022 Base Budget 28.10 24,920,344 21,036,859 3,883,485
Budget Proposals
1. Restore Positions from FY 2021 Staffing Freeze
Eliminations
0.40 ---
2. Staffing Reallocation of Utilities Supervisor Position (1.00)(222,791)-(222,791)
3. Citywide Facility Closures - Internal City Services -(200)200
UTILITIES
370 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Budget Changes (0.60)(222,791)(200)(222,591)
Total FY 2022 Proposed Budget 27.50 24,697,554 21,036,659 3,660,895
Budget Adjustments
Budget Adjustments Positions Expenditures Revenues
Net
General Fund
1. Restore Positions from FY 2021 Staffing Freeze
Eliminations
0.40 ---
This action restores 5.00 previously frozen positions in the Utilities Department (0.40 FTE in the Wastewater Collection Fund) and
offsets costs with vacancy savings. In FY 2021, a total of 5.00 FTE positions were recommended to be frozen and defunded to provide
high-cost savings at relatively low risk for one to two years, including 1.00 Utilities Chief Operating Officer, 1.00 Assistant Director
Utilities Engineering, 1.00 Utilities Supervisor, 1.00 Substation Electrician, and 1.00 Business Analyst. In the FY 2021 recommendation,
the Utilities Department noted that issues may arise if positions were held vacant for more than two years as staffing needs may
change to meet emerging priorities. This action restores these positions and offsets costs with salary reductions equivalent to holding
the same vacancy level. (Ongoing cots: $95,100)
Performance Results
This action contributes to cost containment strategies in FY 2022. Restoring these positions will help with the strategic organizational
restructuring plans and implementation of programs such as Advanced Metering Infrastructure (AMI), Electrification and Fiber-to-the-
Home. The use of vacancy savings to offset expenses will have no service delivery impact.
2. Staffing Reallocation of Utilities Supervisor Position (1.00)(222,791)-(222,791)
This action reallocates 1.0 FTE Utilities Supervisor from Water/Gas/Wastewater (WGW) Operations to Electric Operations. This will
increase Electric Fund expenses by approximately $223,000 and decrease Wastewater Collection Fund expenses by the same amount
for a net zero change within the department. Due to growing demands for Electric line work, Electric needs at the supervisory level
have increased. The impact from this recommendation will be minimal to the WGW group, which will continue to have sufficient
supervisor level oversight to absorb the reallocation and help reduce the backlog of electric work triggered by line work demands.
(Ongoing savings: $230,000
Performance Results
Reallocating a Utilities Supervisor from Water/Gas/Wastewater (WGW) Operations to Electric Operations will increase electric line
construction supervisory experience to oversee increasing electric line inspection and oversight of contract construction work. This
action will be little to no impact for WGW operations.
3. Citywide Facility Closures - Internal City Services --(200)200
This one-time action recognizes a reduction of internal City services associated with the closure of City facilities. Custodial and utilities
services for the Baylands Interpretive Center and the neighborhood library branches (Childrens, College Terrace, and Downtown) will
be reduced as these facilities will be closed to the public. Minimal utilities will be maintained at the facilities in order to preserve the
integrity of the facilities and allow for staff to work in the buildings on a limited basis, as needed. (Ongoing savings: $0)
Performance Results
This action contributes to cost containment strategies in FY 2022.
Budget Reconciliation
Positions Expenditures Revenues
Net
General Fund
00
0
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 371
WATER FUND
Description
From 1895 until 1928, the City’s water supply came from deep wells. When the
groundwater supply started to decline, water was purchased from the San
Francisco Regional Water System to supplement the local water system. Since
1962, when Palo Alto’s wells were discontinued as the primary water system, 100
percent of the water has come from the Regional Water System: 85 percent
derived from snow melt flowing into the Hetch Hetchy Reservoir and the balance
from runoff stored in San Francisco Bay Area reservoirs. The Water Fund focuses
on increasing infrastructure reliability and responsiveness to meet the City’s
water supply needs during an emergency; maintaining high-quality and reliable
sources of water; updating water efficiency goals; and implementing water
efficiency programs and services. Additionally, the engineering division is
implementing a seismic upgrade to the existing reservoirs, wells and receiving
stations to increase supply reliability during catastrophic emergencies.
Key Performance Measures
PROVIDE SAFE AND CLEAN DRINKING WATER FOR OUR CUSTOMERS
Goal Provide safe and clean drinking water for customers.
Objective Ensure drinking water meets all regulatory standards.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Number of customer-owned water
backflow prevention devices in
compliance
92%93%92%90%90%
Description Customer-owned and maintained backflow devices are an integral part of the City’s Cross
Connection Control Program, which began in early 2010. The devices help to ensure that no
contaminants of any kind (e.g. chemicals, debris, reclaimed water) enter the potable water
system.
Purpose The California Department of Public Health provides regulations for the City and its
customers through California Code of Regulations, Title 17. These regulations specify the
types of hazards that require backflow devices.
UTILITIES
372 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Status The City is achieving a compliance rate of up to 90-95 percent on an annual basis. There are
3,853 backflow devices in compliance. This number is growing every year as current codes
require backflow installation for residences as well as commercial properties.
WATER EFFICIENCY
Goal Increase environmental sustainability of the water supply system.
Objective Increase water conservation and efficiency participation.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Annual savings achieved through
water efficiency programs as a
percentage of total sales
1%0%1%0%1%
Description The department measures specific savings achieved by the installation of water efficiency
improvements through the programs that the City offers through the Santa Clara Valley
Water District. The California drought greatly affected the City’s water savings numbers with
the largest amount of savings attributed to the non-residential installation of drought tolerant
landscapes and water efficient irrigation hardware.
Purpose Improving water efficiency for homes and businesses can result in water supply, water
operations, and wastewater processing savings. This measure supports the Water Fund’s
ten-year goal to reduce expected water use by 20 percent by 2020.
Status Water savings are anticipated to increase in FY 2021 compared to prior years as the City
began claiming savings associated with the City’s green building ordinance. The business
process was updated in FY 2019 to enable the City to collect water savings data more
efficiently, which also resulted in a significant impact to the total claimable savings.
WATER QUALITY
Goal Ensure the provision of safe and clean drinking water for customers.
Objective Safe testing of drinking water to meet all regulatory standards.
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Percentage of samples passed
from all sampling stations
100%100%100%100%100%
Description The City of Palo Alto (CPA) regularly collects and tests water samples from connection points
between the San Francisco Public Utilities Commission/City of Palo Alto (SFPUC/CPA),
storage reservoirs, emergency wells, residential areas, and sample station locations within
the distribution system to ensure that the water quality meets all California Department of
Public Health (CDPH) and U.S. Environmental Protection Agency (EPA) prescribed
regulations that limit the amount of contaminants in the drinking water. The City has 18
sampling stations and collects 84-105 samples monthly to test levels of chlorine residual,
coliform and pH levels are within regulatory guidelines. All sample results are reported to
CDPH on a monthly basis.
Purpose Complying with regulations guarantees the City maintains its high standards of water quality
and avoids fines.
Status Palo Alto drinking water continues to be in complete compliance with all existing county,
state, and federal standards for water quality.
Key Performance Measures
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 373
Workload Measures
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2021
Estimated
FY 2022
Proposed
Budget
Percent of miles of water mains
replaced
1.00%0.40%1.00%0.00%1.00%
Number of Customer Accounts
(Water)
20,012 20,016 20,220 20,020 20,200
Percent of surveyed rating the
quality of the Drinking Water (Water)
as “Good” or “Excellent”
N/A*88%N/A*88%N/A*
* The National Citizen's Survey was transitioned from the City Auditor's Office to the Office of the City Manager as part of the FY
2021 Adopted Budget. As a result of this transition the survey was not completed for FY 2019. The survey was completed for FY
2018 and FY 2020; therefore, FY 2019 actual results are not available and are reflected by “N/A.” This FY 2022 Proposed Budget
recommends that the frequency of this survey be adjusted to every other year, to be completed on odd numbered fiscal years.
Therefore, FY 2022, this projected data is also reflected by “N/A.” The next survey is proposed to take place in FY 2023.
UTILITIES
374 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Budget Summary
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change $
FY 2022
Change %
Dollars by Division
CIP Water Fund $6,039,680 $6,737,917 $14,719,292 $14,887,629 $168,337 1.1%
Water Administration $7,482,882 $7,701,071 $9,154,922 $9,353,964 $199,042 2.2%
Water Customer Service $1,628,726 $1,996,917 $2,472,510 $2,518,286 $45,776 1.9%
Water Engineering (Operating)$384,551 $401,902 $688,274 $715,936 $27,662 4.0%
Water Operations and
Maintenance
$5,999,504 $7,021,482 $8,598,172 $8,927,081 $328,909 3.8%
Water Resource Management $22,175,768 $22,932,401 $21,823,001 $22,648,120 $825,119 3.8%
Total $43,711,111 $46,791,689 $57,456,171 $59,051,016 $1,594,845 2.8%
Salary & Benefits
Healthcare $822,482 $885,291 $943,198 $1,066,252 $123,054 13.0%
Other Benefits $125,716 $150,011 $193,501 $198,371 $4,870 2.5%
Overtime $196,939 $207,966 $289,412 $296,937 $7,525 2.6%
Pension $1,306,588 $2,168,421 $1,996,127 $2,150,325 $154,198 7.7%
Retiree Medical $427,827 $440,662 $419,287 $426,143 $6,856 1.6%
Salary $5,266,306 $5,914,670 $5,646,382 $5,629,959 $(16,423)(0.3)%
Workers’ Compensation $118,581 $242,883 $167,879 $223,618 $55,739 33.2%
Total Salary and Benefits $8,264,439 $10,009,904 $9,655,786 $9,991,605 $335,818 3.5%
Dollars by Category
Utility Purchase $21,210,399 $21,773,295 $20,621,296 $21,408,998 $787,702 3.8%
Contract Services $386,318 $461,907 $799,502 $799,502 —0.0%
Supplies & Material $390,121 $425,477 $618,482 $618,482 —0.0%
General Expense $480,190 $516,693 $670,077 $694,777 $24,700 3.7%
Rents & Leases $1,983,270 $2,078,726 $3,396,161 $3,440,789 $44,628 1.3%
Debt Service $1,632,435 $1,562,095 $3,222,606 $3,222,606 —0.0%
Facilities & Equipment —$8,074 $1,150 $1,150 —0.0%
Allocated Charges $3,404,874 $3,494,775 $4,840,165 $5,205,476 $365,310 7.5%
Transfer to Infrastructure $93,339 ————0.0%
Operating Transfers-Out $551,820 $474,953 $136,335 —$(136,335)(100.0)%
Capital Improvement Program $5,313,905 $5,985,790 $13,494,610 $13,667,632 $173,022 1.3%
Total Dollars by Expense
Category
$43,711,111 $46,791,689 $57,456,171 $59,051,016 $1,594,845 2.8%
Revenues
Charges for Services $51,511 $45,031 $10,000 $10,000 —0.0%
Charges to Other Funds $135,114 $229,696 $90,142 $95,508 $5,366 6.0%
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 375
From Other Agencies $488,052 $473,073 $576,632 $576,632 —0.0%
Net Sales $44,638,437 $47,599,266 $44,004,458 $45,331,779 $1,327,320 3.0%
Operating Transfers-In $539,278 $548,136 $557,260 $322,640 $(234,620)(42.1)%
Other Revenue $1,213,898 $1,367,359 $1,287,946 $304,250 $(983,696)(76.4)%
Permits and Licenses —————0.0%
Return on Investments $994,735 $1,018,314 $989,200 $989,200 —0.0%
Total Revenues $48,061,024 $51,280,875 $47,515,638 $47,630,008 $114,370 0.2%
Positions by Division
CIP Water Fund 8.03 8.03 5.34 5.34 —0.0%
Water Customer Service 9.66 9.58 9.58 9.38 (0.20)(2.1)%
Water Engineering (Operating)1.35 1.35 2.33 2.33 —0.0%
Water Operations and
Maintenance
24.85 24.85 27.23 26.99 (0.25)(0.9)%
Water Resource Management 3.02 3.12 3.12 2.79 (0.33)(10.6)%
Total 46.92 46.94 47.61 46.83 (0.78)(1.6)%
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
Account Specialist 0.23 0.23 0.23 0.23 —$18,002
Administrative Associate II 0.65 0.50 0.50 0.50 —$39,198
Assistant Director Utilities
Customer Support Services
0.20 0.20 0.20 0.20 —$40,589
Assistant Director Utilities
Engineering
0.20 0.20 ————
Assistant Director Utilities
Engineering (Freeze)
——0.20 0.20 —$43,484
Assistant Director Utilities
Operations
0.15 0.15 0.15 0.15 —$34,077
Assistant Director Utilities/
Resource Management
0.25 0.25 0.25 0.15 (0.10)$31,334
Business Analyst 1.20 1.20 0.95 0.75 (0.20)$116,501
Business Analyst (Freeze)——0.25 0.25 —$38,834
Cement Finisher 0.56 0.56 0.56 0.56 —$53,243
Budget Summary
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change $
FY 2022
Change %
UTILITIES
376 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Contracts Administrator 0.10 0.10 0.10 0.10 —$11,529
Coordinator Utilities Projects 1.09 1.09 1.09 1.09 —$124,651
Customer Service
Representative
1.81 1.81 1.81 1.81 —$140,615
Customer Service Specialist 0.66 0.66 0.66 0.66 —$56,381
Customer Service Specialist-
Lead
0.59 0.59 0.59 0.59 —$53,899
Electric Project Engineer —0.30 0.30 0.30 —$47,736
Engineer 1.00 1.00 1.00 1.00 —$140,504
Engineering Manager - Electric 0.15 0.15 0.15 0.15 —$32,248
Engineering Manager - WGW 0.33 0.33 0.33 0.33 —$66,540
Engineering Technician III 0.45 0.45 0.45 0.45 —$44,348
Gas and Water Meter
Measurement and Control
Technician
0.80 0.80 0.60 0.60 —$60,940
Gas and Water Meter
Measurement and Control
Technician - Lead
0.20 0.20 0.20 0.20 —$21,736
Heavy Equipment Operator 1.95 1.95 ————
Heavy Equipment Operator -
Install/Repair
0.20 0.20 0.20 0.20 —$21,086
Inspector, Field Services 1.65 1.65 1.74 1.74 —$184,977
Maintenance Mechanic-
Welding
0.80 0.80 0.80 0.80 —$85,230
Manager Customer Service 0.34 0.34 0.34 0.34 —$53,648
Manager Utilities Compliance 0.50 0.50 0.50 0.50 —$98,436
Manager Utilities Credit &
Collection
0.15 0.15 0.15 0.15 —$23,902
Manager Utilities Operations
WGW
0.50 0.50 0.50 0.50 —$92,602
Manager Utilities Program
Services
0.20 0.20 0.20 0.20 —$30,335
Meter Reader 2.03 2.03 2.03 2.03 —$148,206
Meter Reader-Lead 0.34 0.34 0.34 0.34 —$26,562
Power Engineer 0.30 —————
Principal Business Analyst 0.33 0.33 0.33 0.33 —$60,238
Program Assistant I 0.33 0.33 0.33 0.33 —$26,255
Program Assistant II —0.15 0.15 0.20 0.05 $17,098
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 377
Project Engineer 2.00 2.00 2.00 2.00 —$302,432
Resource Planner 0.70 0.70 0.70 0.60 (0.10)$86,124
Restoration Lead 0.31 0.31 0.31 0.31 —$34,987
SCADA Technologist 0.80 0.80 0.89 0.89 —$135,730
Senior Business Analyst 0.99 0.99 0.99 0.99 —$157,158
Senior Engineer 1.00 1.00 1.74 1.74 —$285,652
Senior Mechanic 0.34 0.34 0.34 0.34 —$38,521
Senior Resource Planner 1.68 1.78 1.78 1.60 (0.18)$292,968
Senior Utilities Field Service
Representative
0.49 0.49 0.49 0.49 —$56,780
Senior Water Systems
Operator
2.00 2.00 2.00 2.00 —$224,640
Substation Electrician 0.40 0.40 0.25 0.25 —$35,584
Sustainability Programs
Administrator
———0.40 0.40 $46,409
Utilities Engineer Estimator 0.43 0.43 0.48 0.48 —$60,037
Utilities Field Services
Representative
1.50 1.50 1.50 1.50 —$162,552
Utilities Install Repair-Lead-
Welding Certified
0.46 0.46 0.65 0.65 —$76,699
Utilities Install Repair-Welding
Certified
0.69 0.69 0.94 0.94 —$96,201
Utilities Install/Repair 1.90 1.90 1.44 1.44 —$152,156
Utilities Install/Repair Assistant 0.35 0.35 0.35 0.35 —$31,362
Utilities Install/Repair-Lead 1.02 1.02 1.07 1.07 —$114,631
Utilities Key Account
Representative
0.35 0.35 0.35 0.35 —$42,027
Utilities Locator 0.34 0.34 0.34 0.34 —$35,509
Utilities Marketing Program
Administrator
0.40 0.40 0.40 —(0.40)—
Utilities Safety Officer 0.15 0.15 0.15 0.15 —$19,048
Utilities Supervisor 2.91 2.91 2.41 2.41 —$378,102
Utilities Supervisor (Freeze)——0.50 0.25 (0.25)$40,664
Water System Operator II 3.34 3.34 3.34 3.34 —$330,687
WGW Heavy Equipment
Operator
——1.97 1.97 —$207,625
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
378 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Subtotal: Full-Time
Equivalent Positions
44.79 44.89 45.56 44.78 (0.78)$5,529,248
Temporary/Hourly 2.13 2.05 2.05 2.05 —$194,135
Total Positions 46.92 46.94 47.61 46.83 (0.78)$5,723,383
Staffing
Job Classification
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Adopted
Budget
FY 2022
Proposed
Budget
FY 2022
Change FTE
FY 2022
Salary
UTILITIES
UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET 379
Budget Reconciliation
Positions Expenditures Revenues
Net
General Fund
Prior Year Budget 47.61 57,456,171 47,515,638 9,940,533
One-time Prior Year Budget Adjustments
FY 2021 Management and Professionals Group
Compensation Reduction
219,298 -219,298
Management and Professionals Group Compensation
Reduction
1,684 -1,684
One-time Prior Year Budget Adjustments 0.00 220,982 0 220,982
Adjustments to Costs of Ongoing Activities
Salary and Benefits Adjustments 400,209 -400,209
FY 2021 Management and Professionals Group
Compensation Reduction
(0.95)(224,545)-(224,545)
Water Customer Sales Revenue (0% Rate Increase)-1,330,920 (1,330,920)
Utility Payment Procesing -1,716 (1,716)
Rents & Leases Expenditure Alignment 44,628 44,628
Transfer From Wastewater and Gas Fund (WS-02014
Water, Gas, Wastewater Utility GIS Data)
(136,335)(234,620)98,285
Water Commodity Purchases 787,702 -787,702
Credit Card Fees 24,700 -24,700
Capital Improvement Program 173,022 (983,696)1,156,718
General Fund Cost Allocation Plan 292,938 -292,938
Grounds Maintenance Allocated Charges 145 -145
Liability Insurance Allocated Charges 32,504 -32,504
Printing & Mailing Services Allocated Charges 9,671 -9,671
Stormwater Management Allocated Charges 26 -26
Utilities Administration Allocated Charges 17,259 3,650 13,609
Vehicle Replacement & Maintenance Allocated Charges 12,768 -12,768
Workers’ Compensation Allocated Charges 55,739 -55,739
Adjustments to Costs of Ongoing Activities (0.95)1,490,431 117,970 1,372,460
Total FY 2022 Base Budget 46.66 59,167,584 47,633,608 11,533,976
Budget Proposals
1. Staffing Reallocations for S/CAP and Electrification (0.53)(116,568)-(116,568)
2. Restore Positions from FY 2021 Staffing Freeze
Eliminations
0.70 ---
3. Citywide Facility Closures - Internal City Services -(3,600)3,600
UTILITIES
380 UTILITIES • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED OPERATING BUDGET
Budget Changes 0.17 (116,568)(3,600)(112,968)
Total FY 2022 Proposed Budget 46.83 59,051,016 47,630,008 11,421,008
Budget Adjustments
Budget Adjustments Positions Expenditures Revenues
Net
General Fund
1. Staffing Reallocations for S/CAP and Electrification (0.53)(116,568)-(116,568)
This action reallocates staffing resources (net 0.53 FTE) from Water Fund to the Electric Fund to support the City’s S/CAP and
electrification plans. The Utilities Department evaluate their workplan annually and adjust FTE distribution among shared positions as
priorities change. These changes include expanding responsibilities to implement the City’s S/CAP and cover electric and gas
administrative needs. The electric portfolio has become more complex, taking up more time on electric supply and demand
management and less to other utilities. This action will reduce 0.53 FTE in Water, 0.20 FTE in Fiber; and increase 0.24 FTE in Gas, and
0.49 FTE in Electric, totaling an increase of $118,360 to the Electric Fund FY 2022 operating budget. (Ongoing savings: $120,600)
Performance Results
Reallocating these positions will support the City’s S/CAP, electric vehicle infrastructure and electrification plans.
2. Restore Positions from FY 2021 Staffing Freeze
Eliminations
0.70 ---
This action restores 5.00 previously frozen positions in the Utilities Department (0.70 FTE in the Water Fund) and offsets costs with
vacancy savings. In FY 2021, a total of 5.00 FTE positions were recommended to be frozen and defunded to provide high-cost savings
at relatively low risk for one to two years, including 1.00 Utilities Chief Operating Officer, 1.00 Assistant Director Utilities Engineering,
1.00 Utilities Supervisor, 1.00 Substation Electrician, and 1.00 Business Analyst. In the FY 2021 recommendation, the Utilities
Department noted that issues may arise if positions were held vacant for more than two years as staffing needs may change to meet
emerging priorities. This action restores these positions and offsets costs with salary reductions equivalent to holding the same
vacancy level. (Ongoing Costs: $170,700)
Performance Results
This action contributes to cost containment strategies in FY 2022. Restoring these positions will help with the strategic organizational
restructuring plans and implementation of programs such as Advanced Metering Infrastructure (AMI), Electrification and Fiber-to-the-
Home. The use of vacancy savings to offset expenses will have no service delivery impact.
3. Citywide Facility Closures - Internal City Services 0.00 -(3,600)3,600
This one-time action recognizes a reduction of internal City services associated with the closure of City facilities. Custodial and utilities
services for the Baylands Interpretive Center and the neighborhood library branches (Childrens, College Terrace, and Downtown) will
be reduced as these facilities will be closed to the public. Minimal utilities will be maintained at the facilities in order to preserve the
integrity of the facilities and allow for staff to work in the buildings on a limited basis, as needed. (Ongoing savings: $0)
Performance Results
This action contributes to cost containment strategies in FY 2022.This action contributes to cost containment strategies in FY 2022.
Budget Reconciliation
Positions Expenditures Revenues
Net
General Fund
08
80
CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 279
ELECTRIC FUND
Attachment B
ELECTRIC FUND
280 ELECTRIC FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
Overview
The City of Palo Alto is the only municipality in California that operates a full suite of City-owned utility ser-
vices. The municipal electric power system began operation in 1900 and continues to provide safe, reliable,
and cost effective electric service to residents and customers of Palo Alto. For the 2022-2026 Capital
Improvement Program (CIP), approximately $91.2 million is projected, with $23.3 million budgeted in Fiscal
Year 2022. Overall, a total of 49 projects are planned over the 5-year CIP.
$0
$4,000,000
$8,000,000
$12,000,000
$16,000,000
$20,000,000
$24,000,000
$28,000,000
FY 2018
Actuals
FY 2020
Actuals
FY 2022
Proposed
FY 2024
Projected
FY 2026
Projected
Electric Fund Capital Expenditures
' • \
\
\
\
\
\
ELECTRIC FUND
ELECTRIC FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 281
Major projects funded in the 2022-2026 CIP include Foothills System Rebuild ($2.0 million), 60kV Breaker
Replacements ($4.5 million), Smart Grid Technology Installation ($17.0 million), Electric Customer Connec-
tions ($13.5 million), total 4/12kV conversion projects ($6.2 million), Wood Pole Replacement ($6.3 million),
Electric System Improvements ($12.6 million), and various underground system rebuild projects ($6.1 mil-
lion). The budget for the Electric Fund CIP is categorized into three types of projects: Customer Connec-
tions, System Improvements, and Undergrounding Projects.
Customer Connections
As customers’ electric power needs continually change due to equipment additions, new construction,
building expansions, building remodels, teardowns and rebuilds, and new building occupancy types, the
electric system must evolve to meet these needs. The Electric Customer Connections Project, which is the
only project within this category ($2.7 million in Fiscal Year 2022, $13.5 million over the 2022-2026 CIP).
Projects can range from new buildings associated with the Veterans Administration Hospital to residential
electric panel upgrades. These projects allow for the completion of work required to meet the needs of
customers who have applied for new or upgraded electric service, need temporary power for construction,
or require other services. The Electric Fund pays for a portion of these projects, while remaining costs are
supported by reimbursements from customers for project work performed by the City.
Electric Engineering has received 16 applications for small cell attachments to Electric utility streetlight and
wood poles. The Electric Utility has about 6,500 wood poles and 6,500 streetlight poles citywide, which
are of interest to mobile phone companies. This trend of small cell applications is anticipated to rapidly
increase in the next few years, which would increase both the workload and associated revenue in the Elec-
tric Customer Connections project.
Recent Accomplishments
In Fiscal Year 2020, the Utilities Electric Division completed over 544 customer service projects with a total
cost of $2.4 million and revenue of $1.7 million. Many projects are in progress with no major completions to
report yet.
Infrastructure Inventory
CLASSIFICATION QUANTITY
Miles of 60kV sub transmission lines 19 miles
Substations (w/300 MVA total capacity)9
Traffic Signals (intersections) maintained 101
Streetlights maintained 7,033
Overhead Primary Distribution 116 miles
Underground Primary Distribution 195 miles
Overhead Secondary Distribution 93 miles
Underground Secondary Distribution 78 miles
ELECTRIC FUND
282 ELECTRIC FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
2022-2026 Capital Improvement Program
Recurring Projects
Electric Customer Connections is a recurring project comprised of individual customer projects and bud-
geted based on historical customer applications for service.
System Improvements
Key elements for ensuring reliable electric service to City of Palo Alto residents and customers include
replacing electric system components before they reach their end of life; ensuring there is adequate capac-
ity for the projected electric load; and installing protective equipment to minimize the impact of system
problems. Projects in the System Improvements category allow for a variety of improvements, including
the replacement/upgrade of old cables and equipment and bringing designs up to current standards,
installation of protective equipment and switches, conversion of the electric system from 4,160 Volts (4kV)
to 12,470 Volts (12kV), and installation of capacitors to improve efficiency.
The 2022-2026 CIP includes total funding of $77.6 million in this category, with $20.6 million allocated in
FY 2022. Significant projects in this category include Smart Grid Technology Installation ($17.0 million), 4/
12kV conversion projects ($6.2 million), Electric System Improvements ($12.6 million), Wood Pole Replace-
ments ($6.3 million), 60kV Circuit Breaker Replacements ($4.5 million), and various projects to rebuild
underground districts and substation components.
Recent Accomplishments
•Completed replacement for five of twenty-four 60kV circuit breakers.
•Replaced the security fences at Hanover and Hansen Way Substation.
•Completed installation of the new Station Service power supply for Colorado Power Station.
•Completed the replacement of 85 wood utility poles.
•Completed the Master Civil Plan for Colorado Power Station.
•Completed the electric facility relocation for the Facility Relocation for Caltrain Modernization Project.
The relocation of CPAU’s communication is 80 percent complete.
2022-2026 Capital Improvement Program
Recurring Projects
A total of $27.2 million is programmed for System Improvements recurring projects in the 2022-2026 CIP,
with $5.1 million allocated in Fiscal Year 2022. Recurring projects in this category include the following:
•Communication System Improvements (Fiscal Year 2022: $0.2 million; 5-Year CIP: $0.6 million)
•Electric Distribution System Improvements (Fiscal Year 2022: $2.6 million; 5-Year CIP: $12.6 million)
•Electric Utility Geographic Information System (Fiscal Year 2022: $0.3 million; 5-Year CIP: $0.9 million)
•SCADA System Upgrades (Fiscal Year 2022: $0.4 million; 5-Year CIP: $1.2 million)
•Substation Facility Improvements (Fiscal Year 2022: $0.5 million; 5-Year CIP: $1.5 million)
•Substation Protection Improvements (Fiscal Year 2022: $0.5 million; 5-Year CIP: $1.7 million)
•Underground System Rebuild (Fiscal Year 2022: $0.4 million; 5-Year CIP: $1.8 million)
•Wood Pole Replacements (Fiscal Year 2022: $0.3 million; 5-Year CIP: $6.3 million)
ELECTRIC FUND
ELECTRIC FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 283
Non-Recurring Projects
A total of $51.2 million is allocated in the 2022-2026 CIP for non-recurring System Improvement projects.
Significant projects include:
•Rebuild Underground Districts: (Fiscal Year 2022: $1.8 million; 5-Year CIP: $6.1 million)
•Colorado/Hopkins System Improvement: (5-Year CIP: $0.6 million)
•Smart Grid Technology: (Fiscal Year 2022: $7.0 million; 5-Year CIP: $17.0 million)
•Foothills Distribution System Rebuild (Fiscal Year 2022: $2.0 million; 5-year CIP: $2.0 million)
Undergrounding Projects
The City of Palo Alto began a program to underground overhead electric, telephone, and cable TV facilities
in 1965 with a project along Oregon Expressway. Since that time, 47 Underground Districts have been
formed. The undergrounding of electrical lines is a joint process between the City and AT&T, due to joint
ownership of the poles, and Comcast, which leases pole space from AT&T. All three entities share in the
cost of the installation of underground conduit and boxes necessary to enclose and protect wires and
equipment. The City typically takes the lead in the design, bidding, and construction processes with AT&T
and Comcast reimbursing the City for construction and administrative costs.
Recent Accomplishments
•Underground District 46 – Completed the design of the substructure installation and began installation
of underground cables to convert the portion of the overhead lines near the intersection of El Camino
Real and Arastradero Road/West Charleston Road. Construction is scheduled to begin August 2021.
•Underground District 47 - All customers have completed the service conversions and connections to
the underground system bound by Middlefield Road / Addision Avenue / Cowper Street / Homer
Avenue.
2022-2026 Capital Improvement Program
Non-Recurring Projects
A total of $0.1 million is allocated in the 2022-2026 CIP for non-recurring Undergrounding projects, with
projects starting design in FY 2026. Projects in this category include the following:
•Underground District 42 ($0.05 million)
•Underground District 43 ($0.05 million)
Electric
Project
Number Project Title
FY 2021
Budget
FY 2021
Estimate
FY 2022
Proposed FY 2023 FY 2024 FY 2025 FY 2026
5-Year
Total
SOURCE OF FUNDS
Other
EL-89028 Electric Customer Connections 1,700,000 1,700,000 1,700,000 1,700,000 1,700,000 1,700,000 1,700,000 8,500,000
EL-19004 Wood Pole Replacement 300,000 300,000 150,000 150,000 150,000 150,000 150,000 750,000
Other Total 2,000,000 2,000,000 1,850,000 1,850,000 1,850,000 1,850,000 1,850,000 9,250,000
ELECTRIC FUND
284 ELECTRIC FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
Total Sources 2,000,000 2,000,000 1,850,000 1,850,000 1,850,000 1,850,000 1,850,000 9,250,000
USE OF FUNDS
Customer Connections
EL-89028 Electric Customer Connections 2,836,193 2,836,193 2,700,000 2,700,000 2,700,000 2,700,000 2,700,000 13,500,000
Customer Connections Total 2,836,193 2,836,193 2,700,000 2,700,000 2,700,000 2,700,000 2,700,000 13,500,000
System Improvements
EL-06001 115 kV Electric Intertie 177,481 100,000 127,481 2,000,000 4,500,000 0 0 6,627,481
EL-16002 Capacitor Bank Installation 602,885 402,885 400,000 0 0 0 0 400,000
EL-14000 Coleridge/Cowper/Tennyson 4/12kV Conversion 50,000 50,000 1,250,000 1,250,000 0 0 0 2,500,000
EL-22002 Colorado Distribution Feeder Outlet Replacement 0 0 400,000 0 0 0 0 400,000
EL-19001 Colorado Power Station Equipment Upgrades 1,016,383 1,016,383 200,000 4,300,000 900,000 400,000 0 5,800,000
EL-19002 Colorado Substation Site Improvements 699,448 699,448 150,000 340,000 0 0 0 490,000
EL-15000 Colorado/Hopkins System Improvement 0 0 0 0 0 50,000 500,000 550,000
EL-89031 Communications System Improvements 200,384 200,384 170,000 100,000 100,000 100,000 100,000 570,000
EL-17001 East Meadow Circles 4/12kV Conversion 100,000 100,000 700,000 500,000 500,000 0 0 1,700,000
EL-98003 Electric System Improvements 2,648,911 2,648,911 2,597,000 2,406,000 2,500,000 2,550,000 2,550,000 12,603,000
EL-02011 Electric Utility Geographic Information System 505,110 505,110 270,000 165,000 165,000 165,000 165,000 930,000
EL-17007 Facility Relocation for Caltrain Modernization
Project 2,744,215 2,744,215 0 0 0 0 0 0
EL-21001 Foothills Rebuild (Fire Mitigation)2,000,000 2,000,000 2,000,000 0 0 0 0 2,000,000
EL-20000 Hopkins Substation 4/12kV Conversion 0 0 50,000 120,000 0 640,000 1,200,000 2,010,000
EL-17005 Inter-substation Line Protection Relay 341,826 341,826 150,000 0 0 0 0 150,000
EL-11003 Rebuild Underground District 15 50,000 25,000 1,225,000 0 0 0 0 1,225,000
EL-13003 Rebuild Underground District 16 359,000 9,000 350,000 350,000 0 0 0 700,000
EL-14002 Rebuild Underground District 20 0 0 0 50,000 1,400,000 100,000 0 1,550,000
EL-17000 Rebuild Underground District 23 0 0 0 0 1,100,000 0 0 1,100,000
EL-10006 Rebuild Underground District 24 535,549 535,549 0 0 0 0 0 0
EL-19000 Rebuild Underground District 25 7,125 7,125 0 0 0 0 0 0
EL-16000 Rebuild Underground District 26 300,000 45,000 255,000 0 0 0 0 255,000
EL-19003 Rebuild Underground District 30 0 0 0 50,000 1,200,000 0 0 1,250,000
EL-14005 Reconfigure Quarry Feeders 50,000 50,000 150,000 0 0 0 0 150,000
EL-02010 SCADA System Upgrades 289,894 289,894 399,999 185,000 220,000 225,000 185,000 1,214,999
EL-11014 Smart Grid Technology Installation 5,173,851 100,000 7,000,000 7,000,000 3,000,000 0 0 17,000,000
EL-17002 Substation 60kV Breaker Replacement 1,216,988 1,216,988 900,000 900,000 900,000 900,000 900,000 4,500,000
EL-89044 Substation Facility Improvements 802,398 802,398 450,000 400,000 200,000 200,000 200,000 1,450,000
EL-16003 Substation Physical Security 2,054,434 2,054,434 300,000 200,000 165,000 165,000 0 830,000
EL-89038 Substation Protection Improvements 708,538 708,538 480,000 300,000 300,000 300,000 300,000 1,680,000
EL-16001 Underground System Rebuild 349,999 349,999 349,999 349,999 350,000 350,000 350,000 1,749,998
Electric (Continued)
Project
Number Project Title
FY 2021
Budget
FY 2021
Estimate
FY 2022
Proposed FY 2023 FY 2024 FY 2025 FY 2026
5-Year
Total
ELECTRIC FUND
ELECTRIC FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 285
EL-19004 Wood Pole Replacement 2,993,241 2,993,241 250,000 1,500,000 1,500,000 1,500,000 1,500,000 6,250,000
System Improvements Total 25,977,660 19,996,328 20,574,479 22,465,999 19,000,000 7,645,000 7,950,000 77,635,478
Undergrounding Projects
EL-08001 Underground District 42 - Embarcadero Road,
Emerson, Middlefield 0 0 0 0 0 0 50,000 50,000
EL-11009 Underground District 43 - Alma/Embarcadero 0 0 0 0 0 0 50,000 50,000
EL-12001 Underground District 46 - Charleston/El Camino
Real 1,033,811 1,033,811 0 0 0 0 0 0
EL-11010 Underground District 47-Middlefield, Homer,
Webster, Addison 120,000 120,000 0 0 0 0 0 0
Undergrounding Projects Total 1,153,811 1,153,811 0 0 0 0 100,000 100,000
Total Uses 29,967,664 23,986,332 23,274,479 25,165,999 21,700,000 10,345,000 10,750,000 91,235,478
Electric (Continued)
Project
Number Project Title
FY 2021
Budget
FY 2021
Estimate
FY 2022
Proposed FY 2023 FY 2024 FY 2025 FY 2026
5-Year
Total
CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 361
FIBER OPTICS FUND
FIBER OPTICS FUND
362 FIBER OPTICS FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
Overview
The City of Palo Alto is the only municipality in the State of California that operates a full suite of City-
owned utility services. The most recent addition to this list of services provided to City of Palo Alto resi-
dents and commercial customers is the licensing of dark fiber service connections on a dark optical fiber
backbone network (fiber network), originally designed and built by the City in the mid to late 1990s.
$0
$400,000
$800,000
$1,200,000
$1,600,000
$2,000,000
FY 2018
Actuals
FY 2020
Actuals
FY 2022
Proposed
FY 2024
Projected
FY 2026
Projected
Fiber Optics Fund Capital Expenditures
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FIBER OPTICS FUND
FIBER OPTICS FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 363
The City of Palo Alto is the only municipality in the State of California that operates a full suite of City-
owned utility services. The most recent addition to this list of services provided to City of Palo Alto resi-
dents and commercial customers is the licensing of dark fiber service connections on a dark optical fiber
backbone network (fiber network), originally designed and built by the City in the mid to late 1990s.
For the 2022-2026 Capital Improvement Program (CIP), expenditures of $2.3 million are programmed, with
$0.5 million allocated in Fiscal Year 2022. Major projects funded in the 2022-2026 CIP include Fiber Optics
Customer Connections ($1.3 million), and Fiber Network System Improvements ($1.0 million). The budget
for the Fiber Optics CIP can be categorized into two types of projects: Capacity Improvements and Cus-
tomer Connections.
Capacity Improvements
With advances in various technologies dependent on high-bandwidth broadband connectivity, increases in
online services and applications, and significant increases in data transmission over fiber optic networks,
access to fiber optic cables is increasingly in demand. To ensure reliable fiber optic service to City of Palo
Alto residents and commercial customers, network components such as fiber optic cables and splice cabi-
nets need to be upgraded or added to increase capacity; replaced or protected from damage by animals;
and rerouted away from hazardous conditions.
Recent Accomplishments
•Created a work plan to facilitate improvements if the Palo Alto Foothills. The plan is focused on fire
safety measures. Actions will include undergrounding fiber cables and moving existing cables, both
aerial and underground, to reduce fire danger.
•Coordinated with Caltrain to optimize City fiber for safety and efficiency at key Alma St. Caltrain
crossings.
2022-2026 Capital Improvement Program
Recurring Projects
There is one recurring project in the Capacity Improvements category in the 2022-2026 CIP:
•Fiber Network System Improvements (Fiscal Year 2022: $0.2 million; 2022-2026 CIP: $1.0 million)
Infrastructure Inventory
CLASSIFICATION QUANTITY
Route Miles of Backbone Fiber Cable 55.4
Route Miles of Overhead Backbone Fiber Optic
Cable
21.6
Route Miles of Underground Backbone Fiber Optic
Cable
33.8
FIBER OPTICS FUND
364 FIBER OPTICS FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
Non-Recurring Projects
There are no non-recurring projects in the Capacity Improvements category with amounts in the 2022-
2026 CIP.
The Fiber Network System Rebuild project is on hold pending Council’s direction for City fiber network
expansion and fiber-to-the-home. This project will rebuild portions of the network that have reached
capacity and increase the network’s capacity and ability to provide dark fiber optic service connections to
all potential customers. Rebuilding portions of the fiber network includes installation of additional fiber
optic cables in the Stanford Research Park area and replacement of several below ground splice closures
with pad-mounted pedestals. Rebuild work originally scheduled for Fiscal Year 2022 included installing
substructure and dark fiber for a new fiber path from Park Boulevard Substation to the Stanford Research
Park area.
Customer Connections
The fiber network must evolve as customers continually change their fiber optic needs due to equipment
additions, new construction, building expansions, building remodels, teardowns and rebuilds, and new
building occupancy types. Projects in this category include work required to meet the needs of customers
who have applied for new or upgraded dark fiber optic service connections. The connection costs associ-
ated with new or upgraded connections are offset by non-recurring charges (NRC) to establish the con-
nections and monthly recurring charges (MRC) or dark fiber license fees.
Recent Accomplishments
•Fiber Engineering and Operations is working in tandem with Caltrain to improve the safety and
reliability of both City Fiber and Caltrain’s infrastructure. The work is primarily to enable Caltrain to
electrify its trains. As a result, City fiber has raised the height of its fiber cables which creates an
additional safety measure.
•Fiber in the Arastradero Road Area is being moved from the rear of the house lots to underground the
street to enable access for maintenance and improvements.
2022-2026 Capital Improvement Program
Recurring Projects
There is one recurring project, Fiber Optics Customer Connections, in the Customer Connections category.
In the 2022-2026 Capital Improvement Program, recurring funding in this project remains at approximately
$0.3 million annually. This project provides funding for the installation of fiber optic infrastructure for new
service connections.
Non-Recurring Projects
There are no non-recurring projects in this category.
FIBER OPTICS FUND
FIBER OPTICS FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 365
Fiber Optics
Project
Number Project Title
FY 2021
Budget
FY 2021
Estimate
FY 2022
Proposed FY 2023 FY 2024 FY 2025 FY 2026
5-Year
Total
SOURCE OF FUNDS
Other
FO-10000 Fiber Optics Customer Connections 200,000 200,000 200,000 200,000 200,000 200,000 0 800,000
Other Total 200,000 200,000 200,000 200,000 200,000 200,000 0 800,000
Total Sources 200,000 200,000 200,000 200,000 200,000 200,000 0 1,000,000
USE OF FUNDS
Capacity Improvements
FO-10001 Fiber Optics Network - System Improvements 436,716 436,716 200,000 200,000 200,000 200,000 200,000 1,000,000
FO-16000 Fiber Optics Network - System Rebuild 1,074,318 1,074,318 0 0 0 0 0 0
Capacity Improvements Total 1,511,034 1,511,034 200,000 200,000 200,000 200,000 200,000 1,000,000
Customer Connections
FO-10000 Fiber Optics Customer Connections 249,998 249,999 250,000 250,000 250,000 250,000 250,000 1,250,000
Customer Connections Total 249,998 249,999 250,000 250,000 250,000 250,000 250,000 1,250,000
Total Uses 1,761,032 1,761,033 450,000 450,000 450,000 450,000 450,000 2,250,000
CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 375
GAS FUND
GAS FUND
376 GAS FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
Overview
The City of Palo Alto is the only municipality in California that operates a full suite of City-owned utility ser-
vices. The municipal natural gas distribution system began operation in 1917 and provides safe, reliable, and
cost effective gas service to residents and customers of Palo Alto. For the 2022-2026 Capital Improvement
Program (CIP), approximately $35.2 million is projected, with $5.8 million allocated in Fiscal Year 2022.
Overall, a total of eight projects are planned for the 5-year CIP.
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
FY 2018
Actuals
FY 2020
Actuals
FY 2022
Proposed
FY 2024
Projected
FY 2026
Projected
Gas Fund Capital Expendiures
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GAS FUND
GAS FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 377
Major projects funded in the 2022-2026 CIP include Gas Main Replacements (cumulative total of $23.1 mil-
lion), Gas System, Customer Connections ($5.8 million), and Gas Meters and Regulators ($3.5 million). The
budget for the Gas Fund CIP can be categorized into three separate types of projects: Customer Connec-
tions, Gas Main Replacements, and System Improvements.
Customer Connections
As customers continually change their gas needs due to equipment additions, building expansions, build-
ing remodels, and new building occupancy types, the gas system must evolve to meet these needs. The
Gas System Customer Connections project, which is one of the largest recurring projects within the Gas
Fund ($1.1 million in Fiscal Year 2022, $5.8 million over the 2022-2026 CIP), is accounted for within this cat-
egory. This project allows for the completion of work required to meet the needs of customers who have
applied for new or upgraded gas service. The Gas Fund pays for a portion of this project, while remaining
costs are supported by reimbursements from customers for connection work performed by the City.
Recent Accomplishments
•In Fiscal Year 2020, the Utilities Gas Division completed approximately 110 customer service projects, at
a cost of $0.5 million.
Infrastructure Inventory
CLASSIFICATION QUANTITY
Total miles of gas main distribution system 210.56
Total miles of gas service extension to residents and
businesses
203.98
Number of gas receiving stations 4
Natural Gas System
MATERIAL TYPE MILES OF MAINS IN SYSTEM
NUMBER OF SERVICES IN
SYSTEM
MILES OF SERVICES IN
SYSTEM (AVG 62’SERVICE)
Steel 62.61 2,200 25.83
Plastic, PVC 33.68 705 8.28
Plastic, PE 114.23 14,362 168.64
Plastic, ABS 0.05 20 0.23
Plastic, Other 0.00 7 0.08
Other 0 77 0.90
TOTAL 210.58 17,371 203.98
GAS FUND
378 GAS FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
2022-2026 Capital Improvement Program
Recurring Projects
A total of $5.8 million is programmed for Customer Connections recurring projects in the 2022-2026 CIP,
with $1.1 million allocated in Fiscal Year 2022. Recurring projects in this category include the following:
•Gas System, Customer Connections (Fiscal Year 2022: $1.1 million; 5-Year CIP: $5.8 million)
Gas Main Replacements
The Gas Main Replacements (GMR) category accounts for the replacement of inadequately-sized and
structurally deficient gas mains and services that are subject to corrosion or reaching the end of their
expected life. The Utilities Department coordinates with the Public Works Department’s street mainte-
nance projects to minimize damage to the City’s pavement and maximize cost efficiency. In the next five
years, it is anticipated that approximately 90,000 linear feet of gas mains, or eight percent of the entire
system, will be replaced. The 2022-2026 CIP includes $23.1 million in funding for projects within this cate-
gory.
Recent Accomplishments
•Finalized designs of the Gas Main Replacement 23 project within business districts to replace
approximately 27,000 linear feet of natural gas mains and 350 natural gas service pipelines made of
Polyvinyl Chloride (PVC) and Steel Black Wrap Pipe (BWP).
2022-2026 Capital Improvement Program
Non-Recurring Projects
GMR projects are included in the 2022-2026 CIP (Fiscal Year 2022: $7.0 million; 5-Year CIP: $23.1 million).
System Improvements
To ensure reliable gas services for the City of Palo Alto residents and customers, gas infrastructure must be
replaced upon reaching the end of its expected life. The System Improvements category includes three
projects during the 2022-2026 CIP at a total cost of $6.3 million, with $1.6 million allocated in Fiscal Year
2022.
Recent Accomplishments
•Completed replacement of approximately 109 natural gas services with pipeline material of
Acrylonitrile Butadiene Styrene (ABS) or Tenite, at various locations within the City.
•Replaced multiple large diameter gas emergency valves that had active gas leaks.
•In CY2020, repaired 69 Grade 1, 2, and 3 leaks throughout the City.
•Completed inspection of 408 of the 1,250 sanitary sewer laterals to be inspected in year one under the
Phase II Crossbore Gas Safety Program. The Phase II Crossbore Gas Safety Program was terminated
early due to the COVID-19 pandemic.
•The Phase III Crossbore Gas Safety Program will start construction in March 2021 and will start where
Phase project ended. The Phase III Crossbore Safety Program is to inspect existing sanitary sewer
laterals for damages caused during the installation of natural gas main and service pipelines.
GAS FUND
GAS FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 379
2022-2026 Capital Improvement Program
Recurring Projects
There are three funded recurring projects in the System Improvements category in the 2022-2026 CIP:
•Gas Distribution System Improvements (Fiscal Year 2022: $0.5 million; 5-Year CIP: $2.5 million)
•Gas Equipment and Tools (Fiscal Year 2022: $0.1 million; 5-Year CIP: $0.3 million)
•Gas Meters and Regulators (Fiscal Year 2022: $1.0 million; 5-Year CIP: $3.5 million)
Non-Recurring Projects
There are no non-recurring project in the System Improvements category in the 2022-2026 CIP.
Please refer to the City of Palo Alto Utilities webpage to confirm project details: https://www.cityof-
paloalto.org/Departments/Utilities/Utilities-Services-Safety/Utilities-Projects
Gas
Project
Number Project Title
FY 2021
Budget
FY 2021
Estimate
FY 2022
Proposed FY 2023 FY 2024 FY 2025 FY 2026
5-Year
Total
SOURCE OF FUNDS
Other
GS-80017 Gas System, Customer Connections 900,000 900,000 900,000 900,000 900,000 900,000 900,000 4,500,000
Other Total 900,000 900,000 900,000 900,000 900,000 900,000 900,000 4,500,000
Total Sources 900,000 900,000 900,000 900,000 900,000 900,000 900,000 4,500,000
USE OF FUNDS
Customer Connections
GS-80017 Gas System, Customer Connections 1,155,053 1,155,053 1,124,169 1,166,894 1,210,901 1,247,228 1,100,000 5,849,192
Customer Connections Total 1,155,053 1,155,053 1,124,169 1,166,894 1,210,901 1,247,228 1,100,000 5,849,192
Gas Main Replacements
GS-12001 Gas Main Replacement - Project 22 70,000 70,000 0 0 0 0 0 0
GS-13001 Gas Main Replacement - Project 23 7,740,697 7,740,697 1,140,697 0 0 0 0 1,140,697
GS-14003 Gas Main Replacement - Project 24 0 0 2,000,000 7,000,000 0 0 0 9,000,000
GS-15000 Gas Main Replacement - Project 25 0 0 0 0 2,000,000 9,000,000 0 11,000,000
GS-16000 Gas Main Replacement - Project 26 0 0 0 0 0 0 2,000,000 2,000,000
Gas Main Replacements Total 7,810,697 7,810,697 3,140,697 7,000,000 2,000,000 9,000,000 2,000,000 23,140,697
System Improvements
GS-18000 Gas ABS/Tenite Replacement Project 1,149,062 1,149,062 0 0 0 0 0 0
GAS FUND
380 GAS FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
GS-11002 Gas Distribution System Improvements 511,464 511,464 500,000 500,000 500,000 500,000 500,000 2,500,000
GS-13002 Gas Equipment and Tools 100,000 100,000 50,000 50,000 50,000 50,000 50,000 250,000
GS-80019 Gas Meters and Regulators 183,394 183,394 1,000,000 1,000,000 500,000 500,000 500,000 3,500,000
System Improvements Total 1,943,920 1,943,920 1,550,000 1,550,000 1,050,000 1,050,000 1,050,000 6,250,000
Total Uses 10,909,670 10,909,670 5,814,866 9,716,894 4,260,901 11,297,228 4,150,000 35,239,889
Gas (Continued)
Project
Number Project Title
FY 2021
Budget
FY 2021
Estimate
FY 2022
Proposed FY 2023 FY 2024 FY 2025 FY 2026
5-Year
Total
CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 429
WASTEWATER
COLLECTION FUND
WASTEWATER COLLECTION FUND
430 WASTEWATER COLLECTION FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
Overview
The City of Palo Alto is the only municipality in California that operates a full suite of City-owned utility ser-
vices. The municipal Wastewater Collection System began operation in 1898 and continues to provide safe,
reliable, and cost effective services to residents and customers of Palo Alto. For the 2022-2026 Capital
Improvement Program (CIP), approximately $20.1 million is projected, with $5.6 million allocated in Fiscal
Year 2022. Overall, a total of eight projects are programmed for the 5-year CIP.
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
FY 2018
Actuals
FY 2020
Actuals
FY 2022
Proposed
FY 2024
Projected
FY 2026
Projected
Wastewater Collection Fund
Capital Expenditures
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WASTEWATER COLLECTION FUND
WASTEWATER COLLECTION FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 431
Major projects funded in the 2022-2026 CIP include Wastewater Collection System Rehabilitation/Aug-
mentation projects (cumulative total of $11.0 million), Sewer Lateral/Manhole Rehabilitation and Replace-
ment ($4.7 million), and Sewer System, Customer Connections ($2.2 million). The budget for the
Wastewater Collection Fund CIP is categorized into two types of projects: Customer Connections and Sys-
tem Improvements. In order to balance the Wastewater Collection Fund reserves and keep rate increases
low, the wastewater main replacement projects have been reduced to keep expenditures in line with
expected revenue.
Customer Connections
As customers continually change their wastewater needs due to equipment additions, new construction,
building expansions, building remodels, teardowns and rebuilds, and new building occupancy types, the
Wastewater Collection System must evolve to meet these needs. The Sewer System Customer Connections
project is the only project within this category and includes work required to meet the needs of customers
who have applied for new sewer laterals. The Wastewater Collection Fund pays for a portion of this project
while remaining costs are supported by reimbursements from customers for project work performed by
the City.
Recent Accomplishments
•In Fiscal Year 2020, the Utilities Wastewater Division completed over 54 customer service projects with
a total cost of $0.3 million.
2022-2026 Capital Improvement Program
Recurring Projects
There is only one project within this category, the Sewer System, Customer Connections project, with fund-
ing of $2.3 million over the 5-year CIP. This project funds changes to customer connections and costs are
partially offset by reimbursements from customers requesting the service.
System Improvement
To ensure reliable wastewater services for the City of Palo Alto residents and customers, infrastructure
must be replaced upon reaching the end of its useful life. The infrastructure replacement program includes
projects that will rehabilitate or replace deteriorated pipelines. In the next five years, it is estimated that
approximately 22,000 linear feet of wastewater mains will be replaced.
Infrastructure Inventory
CLASSIFICATION QUANTITY
Total miles of sanitary sewer lines 216
Total number of sanitary laterals 18,028
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WASTEWATER COLLECTION FUND
432 WASTEWATER COLLECTION FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
Recent Accomplishments
•Completed construction of Sanitary Sewer Replacement Project (SSR 28) Part B to replace
approximately 7,655 feet of sewer pipes, 77 service laterals, and 12 manholes on Oregon Expressway
and rehabilitate 2,000 linear feet of sewer main pipelines on lower Page Mill Road and Colorado
Avenue.
•Completed design and solicitation package of Sanitary Sewer Replacement Project (SSR 29) to replace
approximately 8,952 linear feet of sanitary sewer mains, as well as replacement and rehabilitation of 41
sewer manholes in the Charleston Meadows neighborhood. The existing clay pipe mains will be
replaced with High Density Polyethylene pipe. In addition, 154 existing City-owned sewer service
laterals and cleanouts will be replaced with new 4‘ and 6‘ service laterals and cleanouts.
2022-2026 Capital Improvement Program
Recurring Projects
A total of $6.9 million is programmed for System Improvement recurring projects in the 2022-2026 CIP,
with $1.1 million allocated in Fiscal Year 2022. Recurring projects in this category include the following:
•Wastewater System Improvements (Fiscal Year 2022: $0.2 million; 5-Year CIP: $1.9 million)
•Wastewater General Equipment and Tools (Fiscal Year 2022: $0.05 million; 5-Year CIP: $0.3 million)
•Sewer Lateral/Manhole Rehabilitation and Replacement (Fiscal Year 2022: $0.8 million; 5-Year CIP:
$4.8 million)
Non-Recurring Projects
The majority of funding within this category is allocated towards Wastewater Collection System Rehabilita-
tion/Augmentation Projects (cumulative total of $11.0 million). These projects implement high-priority reha-
bilitation, augmentation, and lateral replacement work which reduces inflow of rainfall and groundwater
into the collection system. The Utilities Department coordinates with the Public Works Department’s street
maintenance projects to minimize damage to the City’s pavement and maximize cost efficiencies.
Linear footage and locations are subject to change, please refer to the City of Palo Alto Utilities webpage
to confirm project details: https://www.cityofpaloalto.org/Departments/Utilities
Wastewater Collection
Project
Number Project Title
FY 2021
Budget
FY 2021
Estimate
FY 2022
Proposed FY 2023 FY 2024 FY 2025 FY 2026
5-Year
Total
SOURCE OF FUNDS
Other
WC-80020 Sewer System, Customer Connections 750,000 750,000 450,000 450,000 450,000 450,000 450,000 2,250,000
Other Total 750,000 750,000 450,000 450,000 450,000 450,000 450,000 2,250,000
Total Sources 750,000 750,000 450,000 450,000 450,000 450,000 450,000 2,250,000
USE OF FUNDS
Customer Connections
WC-80020 Sewer System, Customer Connections 436,846 436,846 450,000 450,000 450,000 450,000 450,000 2,250,000
WASTEWATER COLLECTION FUND
WASTEWATER COLLECTION FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 433
Customer Connections Total 436,846 436,846 450,000 450,000 450,000 450,000 450,000 2,250,000
System Improvements
WC-99013 Sewer Lateral/Manhole Rehabilitation and
Replacement 876,000 876,000 800,000 1,325,000 850,000 875,500 900,000 4,750,500
WC-15001 Wastewater Collection System Rehabilitation/
Augmentation Project 28 692,890 692,890 0 0 0 0 0 0
WC-16001 Wastewater Collection System Rehabilitation/
Augmentation Project 29 3,809,820 3,809,820 0 0 0 0 0 0
WC-17001 Wastewater Collection System Rehabilitation/
Augmentation Project 30 480,000 130,000 4,130,000 0 0 0 0 4,130,000
WC-19001 Wastewater Collection System Rehabilitation/
Augmentation Project 31 0 0 0 0 1,650,000 3,550,000 0 5,200,000
WC-20000 Wastewater Collection System Rehabilitation/
Augmentation Project 32 0 0 0 0 0 0 1,650,000 1,650,000
WC-13002 Wastewater General Equipment and Tools 212,893 212,893 50,000 50,000 50,000 50,000 50,000 250,000
WC-15002 Wastewater System Improvements 405,952 405,952 200,000 500,000 500,000 500,000 200,000 1,900,000
System Improvements Total 6,477,555 6,127,555 5,180,000 1,875,000 3,050,000 4,975,500 2,800,000 17,880,500
Total Uses 6,914,401 6,564,401 5,630,000 2,325,000 3,500,000 5,425,500 3,250,000 20,130,500
Wastewater Collection (Continued)
Project
Number Project Title
FY 2021
Budget
FY 2021
Estimate
FY 2022
Proposed FY 2023 FY 2024 FY 2025 FY 2026
5-Year
Total
CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 487
WATER FUND
WATER FUND
488 WATER FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
Overview
The City of Palo Alto is the only municipality in California that operates a full suite of City-owned utility ser-
vices. The municipal Water Distribution System began operation in 1896 and continues to provide safe, reli-
able, and cost-effective water service to residents and customers of Palo Alto. For the 2022-2026 Capital
Improvement Program (CIP), approximately $61.6 million is projected, with $14.9 million allocated in Fiscal
Year 2022. Overall, a total of 12 projects are planned for the 5-year CIP.
0
4,000,000
8,000,000
12,000,000
16,000,000
20,000,000
FY 2018
Actuals
FY 2020
Actuals
FY 2022
Proposed
FY 2024
Projected
FY 2026
Projected
Water Fund Capital
Expenditures
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WATER FUND
WATER FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 489
Major projects funded in the 2022-2026 CIP include Water Main Replacements (cumulative total of $29.7
million), Water System Customer Connections ($4.7 million), Water Meters ($2.9 million) and Water, Gas,
and Wastewater Utility GIS Data ($2.6 million). The budget for the Water Fund CIP is categorized into three
types of projects: Customer Connections, System Improvements, and Water Main Replacements.
Customer Connections
As customers continually change their water needs due to equipment additions, new construction, building
expansions, building remodels, teardowns and rebuilds, and new building occupancy types, the water sys-
tem must evolve to meet these needs. The Water System Customer Connections is the only project in this
category and includes work required to meet the needs of customers who have applied for new or
upgraded water service. The Water Fund pays for a portion of this project, while remaining costs are sup-
ported by reimbursements from customers for project work performed by the City.
Recent Accomplishments
•In Fiscal Year 2020 the Water Utility completed over 92 water service projects with a total cost of
$0.9 million.
Infrastructure Inventory
Classification Quantity
Miles of water main 235.84
Number of wells 1 active standby and 7 emergency standby
Number of reservoirs 4 steel and 3 reinforced concrete
Water Distribution System Main Materials
MATERIAL TYPE TOTAL LENGTH PERCENT
Asbestos Cement Pipe 131.00 mi 55.86%
Concrete Cylinder Pipe 16.79 mi 7.12%
Cast Iron Pipe 18.13 mi 7.69%
Copper Pipe 0.28 mi 0.12%
Ductile Iron Pipe 6.98 mi 2.96%
Polyethylene 19.04 mi 8.08%
Polyvinyl Chloride 42.36 mi 17.96%
Steel 0.73 mi 0.31%
Unknown Material 0.51 mi 0.21%
Total:235.84 mi
WATER FUND
490 WATER FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
2022-2026 Capital Improvement Program
Recurring Projects
The Water System Customer Connections is the only project within this category. Over the course of the
2022-2026 CIP, $4.7 million is forecasted, with $0.9 million allocated in Fiscal Year 2022.
System Improvements
To ensure reliable water services for the City of Palo Alto’s residents and customers, infrastructure must be
replaced at the end of its expected life. The System Improvements category includes three projects as part
of the 2022-2026 CIP at a total cost of $27.3 million, with $2.6 million allocated in Fiscal Year 2022.
Recent Accomplishments
•Started construction on the new 1.5 million gallon Corte Madera water tank.
•Completed the construction of the Mayfield Reservoir Vent and Crack Repair project.
•Completed development of the Water Infrastructure Risk and Resilience Assessment document as
required by America’s Water Infrastructure Act of 2018 (AWIA ’18), which requires community water
systems serving 3,300 or more persons to conduct a risk and resilience assessment and develop an
emergency response plan actively updated every five years.
•Developed the test procedure for collecting data to evaluate the condition of our aging Asbestos
Cement Pipe (ACP). Continue to collect samples as they are removed from underground. The test
result is tool to help determine the life expectancy of ACP pipes.
2022-2026 Capital Improvement Program
Recurring Projects
A total of $11.3 million is programmed for System Improvement recurring projects during the 2022-
2026 CIP, with $2.1 million allocated in Fiscal Year 2022. Recurring projects in this category include the fol-
lowing:
•Water Distribution System Improvements (Fiscal Year 2022: $0.3 million; 5-Year CIP: $1.5 million)
•Water Fusion and General Equipment/Tools (Fiscal Year 2022: $0.1 million; 5-Year CIP: $0.3 million)
•Water, Gas, Wastewater Utility GIS Data (Fiscal Year 2022: $0.5 million; 5-Year CIP: $2.6 million)
•Water Meters (Fiscal Year 2022: $0.5 million; 5-Year CIP: $2.9 million)
•Water Service Hydrant Replacement (Fiscal Year 2022: $0.4 million; 5-Year CIP: $2.0 million)
•Water System Supply Improvements (Fiscal Year 2022: $0.3 million; 5-Year CIP: $2.0 million)
Non-Recurring Projects
A total of $16.0 million is programmed for non-recurring projects during the 2022-2026 CIP, with
$0.5 million allocated in Fiscal Year 2022. Non-recurring projects in this category include the following:
•Water Recycling Facilities (5-year CIP: $0.4 million)
•Water Tank Seismic Water System Upgrades (Fiscal Year 2022: $7.0 million; 5-year CIP: $15.6 million)
WATER FUND
WATER FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET 491
Water Main Replacements
The Water Main Replacements category accounts for the replacement of inadequately sized and structur-
ally deficient water mains. In the next five years, it is estimated that approximately 7,500 linear feet of
water mains will be replaced. The annual linear feet replacement totals were reduced due to significant
increases in labor and material costs. City staff has proposed a new replacement schedule of water &
wastewater construction every even year and gas construction every odd year to reduce the amount of
construction when prices are high and allow staff to focus on other priorities such as water tank replace-
ment and cross-bore inspections.
A recent study indicated that the City has already replaced many of the most leak-prone and deteriorated
pipes from the past water main replacement projects 1 through 26. This study recommended replacing 13.5
miles of mains that are deteriorating or in liquefaction zones. Project 27 included 0.6 mile of seismically vul-
nerable pipes and some deteriorating pipes. This will continue to be the trend for upcoming water main
replacement projects.
Recent Accomplishments
•Started construction on the new 1.5 million gallon Corte Madera water tank.
•Completed the construction of the Mayfield Reservoir Vent and Crack Repair project.
•Completed development of the Water Infrastructure Risk and Resilience Assessment document as
required by America’s Water Infrastructure Act of 2018. America’s Water Infrastructure Act of 2018
(AWIA ’18) requires community water systems serving 3,300 or more persons to conduct a risk and
resilience assessment and develop an emergency response plan that must be actively updated every
five years.
•Developed the test procedure for collecting data to evaluate the condition of our aging Asbestos
Cement Pipe (ACP). Continue to collect samples as they are removed from underground. The test
result is tool to help determine the life expectancy of ACP pipes.
2022-2026 Capital Improvement Program
The 2022-2026 CIP includes $29.7 million in funding for three non-recurring projects within this category,
with $11.4 million appropriated for Fiscal Year 2022. The Utilities Department coordinates with the Public
Works Department’s street maintenance projects to minimize damage to the City’s pavement and maxi-
mize cost efficiencies when replacing water mains.
Water
Project
Number Project Title
FY 2021
Budget
FY 2021
Estimate
FY 2022
Proposed FY 2023 FY 2024 FY 2025 FY 2026
5-Year
Total
SOURCE OF FUNDS
Other
WS-80013 Water System Customer Connections 1,860,946 1,860,946 877,250 904,595 931,955 960,500 1,150,000 4,824,300
Other Total 1,860,946 1,860,946 877,250 904,595 931,955 960,500 1,150,000 4,824,300
Transfer from Gas Fund
WS-02014 Water, Gas, Wastewater Utility GIS Data 156,621 156,621 161,320 166,160 171,143 176,266 181,000 855,889
WATER FUND
492 WATER FUND • CITY OF PALO ALTO FISCAL YEAR 2022 PROPOSED CAPITAL BUDGET
Transfer from Gas Fund Total 156,621 156,621 161,320 166,160 171,143 176,266 181,000 855,889
Transfer from Wastewater Collection Fund
WS-02014 Water, Gas, Wastewater Utility GIS Data 156,621 156,621 161,320 166,160 171,143 176,267 181,000 855,890
Transfer from Wastewater Collection Fund Total 156,621 156,621 161,320 166,160 171,143 176,267 181,000 855,890
Total Sources 2,174,188 2,174,188 1,199,890 1,236,915 1,274,241 1,313,033 1,512,000 6,536,079
USE OF FUNDS
Customer Connections
WS-80013 Water System Customer Connections 922,365 922,365 877,250 904,595 931,955 960,500 989,000 4,663,300
Customer Connections Total 922,365 922,365 877,250 904,595 931,955 960,500 989,000 4,663,300
System Improvements
WS-19000 Mayfield Reservoir Subgrade and Venting Repair 363,252 0 0 0 0 0 0 0
WS-11003 Water Distribution System Improvements 561,825 561,825 277,553 285,880 294,456 305,000 314,000 1,476,889
WS-13002 Water General Equipment/Tools 50,000 50,000 100,000 50,000 50,000 50,000 50,000 300,000
WS-80015 Water Meters 530,451 530,451 546,364 562,755 579,638 600,000 621,000 2,909,757
WS-07001 Water Recycling Facilities 391,020 391,020 0 0 391,020 0 0 391,020
WS-07000 Water Regulation Station Improvements 681,394 681,394 0 0 0 0 0 0
WS-80014 Water Service and Hydrant Replacement 400,000 400,000 400,000 400,000 400,000 412,000 424,000 2,036,000
WS-11004 Water System Supply Improvements 749,469 749,469 277,553 285,880 345,131 715,000 366,000 1,989,564
WS-09000 Water Tank Seismic Upgrade and Rehabilitation 7,080,313 7,080,313 500,000 7,000,000 500,000 600,000 7,000,000 15,600,000
WS-02014 Water, Gas, Wastewater Utility GIS Data 1,280,592 1,280,592 483,958 498,477 513,431 528,800 544,000 2,568,666
System Improvements Total 12,088,316 11,725,064 2,585,428 9,082,992 3,073,676 3,210,800 9,319,000 27,271,896
Water Main Replacements
WS-13001 Water Main Replacement - Project 27 3,096,589 3,096,589 0 0 0 0 0 0
WS-14001 Water Main Replacement - Project 28 562,516 84,031 11,000,000 0 0 0 0 11,000,000
WS-15002 Water Main Replacement - Project 29 0 0 425,000 425,000 8,500,000 0 0 9,350,000
WS-16001 Water Main Replacement - Project 30 0 0 0 0 425,000 425,000 8,500,000 9,350,000
Water Main Replacements Total 3,659,105 3,180,620 11,425,000 425,000 8,925,000 425,000 8,500,000 29,700,000
Total Uses 16,669,786 15,828,049 14,887,678 10,412,587 12,930,631 4,596,300 18,808,000 61,635,196
Water (Continued)
Project
Number Project Title
FY 2021
Budget
FY 2021
Estimate
FY 2022
Proposed FY 2023 FY 2024 FY 2025 FY 2026
5-Year
Total
MAY 12, 2021 www.cityofpaloalto.org
Proposed FY 2022 Utilities Operating & Capital Budget
UAC Special Meeting
Attachment C •
CITY OF
PALO ALTO
2
FY2022 Proposed Rates & Potential Bill Impact
Utility
Adjusted
FY 2021
Proposed
FY 2022 $ Difference Rate Change
Electric 57.31 57.31 -0.00%
Gas 57.44 59.58 2.14 3.73%
Water 90.42 90.42 -0.00%
Wastewater 41.37 43.32 1.95 4.71%
Refuse 50.07 50.07 -0.00%
Storm Drain 15.04 15.34 0.30 2.00%
User Tax 10.26 10.37 0.11 1.04%
Total Monthly Bill 321.91 326.41 4.50 1.40%
* FY 2022 Rates are effective July 1, 2021.
~CITY OF
~PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
MAY 12, 2021 www.cityofpaloalto.org
FY 2021 Accomplishments:
•Relocated 10 overhead power and communication lines at Caltrain crossing locations
•Completed high level fiber network design and fiber-to-the-home business
•Completed city-wide meter survey (75,000 meters) in preparation for advanced
metering infrastructure (AMI)
•Completed construction of Sanitary Sewer Replacement Project (SSR 29)
•Launched new MyCPAU customer account management portal
•Low Carbon Fuel Standards –EV chargers
•Extended Western Area Power Administration Contract
•Replaced 60 utility wood poles citywide
•
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
MAY 12, 2021 www.cityofpaloalto.org
FY 2022 Initiatives:
•Expand community education and outreach of building electrification (in
collaboration with Planning, Development Services, PWD)
•FTTH education and community engagement and survey
•Begin testing phase and pilot of advance metering infrastructure project
•Continue assessment with PG&E and CAISO for a 2nd transmission line corridor
•Complete phase 3 of the cross bore safety and verification program
•Begin design of advanced water purification system for recycled water
•Deliver turn-key energy efficiency retrofits to SMB customers
•Pursue new outage management system (OMS)
•Citywide evaluation of electrical distribution system
•
CITY OF
PALO ALTO
TITLE 40 FONT BOLD
Subtitle 32 font
MAY 12, 2021 www.cityofpaloalto.org
Electric, Gas, and Water Weekly Supply Data 20.1s-19 Avg vs 2021
U t i i t y Unit
E l ectric MWh
G as. Therms
Water CC F
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-E l ectric , 2020
-E l ectric, 2018-1-9 A v e rage
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Gas, 2020
-Gas, 2018-1.9 Ave ra ge
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-Wate r, 2 ,021
2018-19 vs 20.21 Connpa r-i so n %
-Wate r, 2 ,020 Util i ty
-Wait e r, 2018-19 Ave...-age
We,e k N WI m ber !E l ect r i c Gas 'll'Jater
W eek2 -9% 4-% 6%
W eek3 -9% -_1% 9%
W eek 4 -10% -2.1'% 18%
W eek 5 -5% 36% -6%
W eek6 -11% -10% -7%
W eek7 ___ qi, -23% -_5%
INeekS -11% -3 0 '% -9%
W eek9 -_2% -24% 13%
W eek10 -12% -14% 2 7%
W eek1 _ -9% 2% 12%
W eek 12 -9% .17% 9%
W eek 13 -1_% 1% 25%
W eek 14 -9% -9% 33'%,
lflJ eek 15 -_3% 4% 3 7%
W eek16 -12% -8% 2 1%
W eek17
W eek18
W eek19
W eek20
W eek2 _
W eek22
W eek23
W eek24
W eek25
W eek 26
W eek 27
W eek28
W eek29
W eek30
W eek3 _
W eek32
W eek33
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W eek3S
W eek36
W eek 37
W eek38
W eek39
W eek40
W eek 4_
W eek 42
W eek 43
W eek44
W eek4S
W eek 46
1f1J eek47
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,O.v e -ra.Q e -10% -6 % 11'}{,
ELECTRIC FUND
Operating (pg 335-345) and Capital (pg 279-360)
MAY 12, 2021 www.cityofpaloalto.org
7
ELECTRIC FUND CHANGES
•No rate increase proposed
•Expense $193.9M, increased $10.4M or 5.7%
•Commodities, $8.4M or 9.6%
•Low Carbon Fuel Standard Program, $2.5M or 25%
•Overhead contract, $515K or 8.1%
•Revenue $170.9M, increased $10.7M or 6.7%
•Net sales, $8.7M or 5.9%
•Low Carbon Fuel Standard Program, $1.8M or 1.2%
•Reclass Supervising Electrical Project Engineer to Senior Electric
Engineer
•Reallocated Utilities Supervisor from WGW to Electric
~CITY OF
~PALO ALTO
8
ELECTRIC CAPITAL IMPROVEMENT PROGRAM
Significant Projects for FY22
Foothills Rebuild (Fire Mitigation)
Smart Grid (AMI)
Substation Physical Security
Rebuild UG #15
Coleridge/Cowper/Tennyson 4/12kV
Colorado Distribution Feeder Outlet*
Wood Pole Replacement
$-
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
2019 Actual 2020 Actual Adopted 2021 Proposed 2022
Electric Capital Improvement Program
Customer Connections System Improvements Undergrounding Projects
~CITY OF
~PALO ALTO
■ ■ ■
FIBER FUND
Operating (pg 346-352) and Capital (pg 361-374)
MAY 12, 2021 www.cityofpaloalto.org
10
FIBER FUND CHANGES
•CPI increase, 2% for customers with EDF-1 rates
•Expense $3.3M, decrease $1.1M or 75.6%
•CIP Fiber Optics Network –System Rebuild (on pause)
•Revenue $5.2M, decrease $0.3M or 7.4%
$-
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
$1,800,000
2019 Actual 2020 Actual Adopted 2021 Proposed 2022
Fiber Capital Improvement Program
Capacity Improvements Customer Connections System Rebuild
~CITY OF
~PALO ALTO
• • ■
GAS FUND
Operating (pg 353-362) and Capital (pg 375-402)
MAY 12, 2021 www.cityofpaloalto.org
12
GAS FUND
Operating and Capital
•Proposed rate increase, 3%
•Expense $49.3M, increase $0.5M
or 1.2%
•Commodities $4M or 28.3%
•CIP ($3.5) or (51.4%)
•Revenue $42.4M, increase
$3.5M or 9.5%
•Net sales (rates)
Significant Projects
Gas Main Replacement 23 $-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
2019 Actual 2020 Actual Adopted 2021 Proposed 2022
Gas Capital Improvement Program
Customer Connections Gas Main Replacements System Improvements
~CITY OF
~PALO ALTO
• • •
WASTEWATER COLLECTION FUND
Operating (pg 363-370) and Capital (pg 430 –452)
MAY 12, 2021 www.cityofpaloalto.org
14
WASTEWATER FUND CHANGES
Operating
•Proposed rate increase, 3%
•Expense $24.7M, increase $0.8M or
3.3%
•Revenue $21.0M, decrease ($1.0M)
or (4.4%)
CIP
Wastewater Collection Main
Replacement 30 $-
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
2019 Actual 2020 Actual Adopted 2021 Proposed 2022
Wastewater Collection Capital Improvement Program
Customer Connections System Improvements
~CITY OF
~PALO ALTO
■ ■
WATER FUND
Operating (pg 371-380) and Capital (pg 487 –524)
MAY 12, 2021 www.cityofpaloalto.org
15
WATER FUND CHANGES
Operating
•No rate change
•Expense $59.0M, increase $1.6M or 2.8%
•Commodity $0.8M or 3.8%
•Allocated charges $0.4M or 7.5%
•Salaries & Benefits $0.3M or 3.5%
•Revenue $47.6M, increase $0.1M or 0.2%
Significant Projects
•Water Tank Seismic Upgrade and
Rehabilitation (Corte Madera)
•Water Meter Replacement Project 28
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
2019 Actual 2020 Actual Adopted 2021 Proposed 2022
Water Capital Improvement Program
Customer Connections System Improvements Water Main Replacements
~CITY OF
~PALO ALTO
• • •
MAY 12, 2021 www.cityofpaloalto.org
WORKFORCE
Utilities Department Vacancy -14%
Electric Ops Vacancy -32%
# of Hires since January 2021 –10
# of Promotions since January 2021 - 7
Position Changes:
1.Reclass Supervising Electric Engineer
to Senior Electric Engineer
2.Reallocate Utilities Supervisor from
WGW to Electric
DIVISION MGMT SEIU Total
Administration 3 1 4
Customer Support 1 1
Electric Engineering 1 1 2
Electric Operations 4 18 22
WGW Engineering 1 1 2
WGW Operations 3 3
Grand Total 9 25 34
MAY 12, 2021 www.cityofpaloalto.org
RECOMMENDATIONS
1.Recommend Council approve proposed FY 2022 Utilities
Operating Budget
2.Recommend Council approve proposed FY 2022 Utilities
Capital Budget
UTILITIES FY22 PROPOSED BUDGET www.cityofpaloalto.org
Q & A
City of Palo Alto (ID # 12140)
Utilities Advisory Commission Staff Report
Report Type: New Business Meeting Date: 5/12/2021
City of Palo Alto Page 1
Summary Title: Informational Update on EV Programs
Title: Informational Update on City of Palo Alto Utilities Electric Vehicle
Programs
From: City Manager
Lead Department: Utilities
Recommendation
This is an informational report and no action is required.
Executive Summary
The attached presentation slides provide an update on the status of the City of Palo Alto Utilities (CPAU)
electric vehicle (EV) programs as of March 2021. This is a follow up to the EV update shared with
the Commission in January 2021 (UAC Report #11860) .
Palo Alto continues to build out EV charging infrastructure throughout the City, with priority on the
slowest to move and hardest to reach customers – low-income, multifamily and non-profits.
Meanwhile, Staff is currently working on updating the Sustainability and Climate Action Plan with
revised key actions and goals for EVs, to help the City reach its decarbonization goals. Regardless of this
process, a top priority is for Palo Alto to continue building out EV charging infrastructure throughout the
City, therefore we are also focusing on facilitating the installation of charging infrastructure at
workplaces, public parking lots and retail areas. Furthermore, cross-departmental work is in progress on
creative proposals for curbside charging, fleet electrification, streamlining of permitting, and programs
targeting income-qualified customers.
Attachments:
•Attachment A: Presentation
Staff: Hiromi Kelty
cityofpaloalto.org/ev
Q1 2021
EV Customer
Programs Update
May 12, 2021
Staff: Hiromi Kelty
tfil CITY OF
~ PALO ALTO
•
Attachment A
2
EV PROGRAMS UPDATE CY 2018 –Q1 2021
•In early 2019, plans were presented to the UAC for EV programs, using Low Carbon Fuel Standard funds,
budgeting up to $8.93 million over a 3-year period from CY 2019-2021.
•Dollars spent to date: $1.94 million. Of this amount, $893k was transferred to the state-run point-of-sale Clean Fuel
Reward EV rebate program and $343k was transferred to Public Works to cover CNG stations and public EV
charger related costs.
•Based on UAC feedback, staff are re-evaluating EV Education and Outreach. Over the last 3 year period, 14 in-
person events were facilitated/sponsored to increase community awareness of EVs, including workshops and ride-
and-drive events. Currently, staff are working on rolling-out a robust pandemic friendly calendar of EV education
classes for 2021 and 2022. Updates are also made regularly to EV webpages along with updates to the online EV
calculator tool.
•The total LCFS revenues received to date is $8.53 million. After expenditures/transfers to date, $6.6 million in funds
are available for EV programs as of early March 2021.
Overview
~CITY OF
~PALO ALTO
3
EV PROGRAMS UPDATE –FINANCIALS CY 2018 –Q1 2021
3
CY2018-
CY2019-Mar-ch 2021 Sector-Pr-ogr-am Notes 2021 Budget
Actuals
F u nding for-Stat e-Pay men ts t o tin i s state program p r-o Y ides reb ates up t o $1 ,s ,oo
AIII Palo Al'to m a nd.ait:e d , State-run p o i n t-$1.,.000,000 $893,655
for al ll EV b uryers a t parti cipat ing dea l ers h ips. Progr a m heg,a n
r-esidents o f -sa le C l ean Fu e l R e w a r-d D e c '20. A ,ctual r-ebat es p a i d f cnr P A customers is not y et
(CFR) p r-ogr-am a 1v a i la bl e .
Com1rrnenc",al
Matc h ing f un dis for-CEC's
(llil.dl u:dimg
CA Le V II P gra nt p r-ogr-a m Matching f u n ds for-$I M sta·t e g 1ra n ts p r-ogr-a m ,crea t ing $2M i n
th,e City a 111ld
p ,rov ud i n g re b ate s f o ir $1.,.000 ,0 0 0 0 t ota l f o r thi s progra m fo1r DC fa st: c h arger s a n d Le v e l 2 cha,r-gers.
i nstal llation o f cha r g i n g Funds are o v e 1rs u b sc r-ibed , w i t l, a pplic ati:o n s a t 38 sites , but n o M u ltHfa ,m ily i n fra st:r u ctur-e . W i lli r eceiv e exp end it ur-e s t o d a t e _ IP r-o pe11rties) $1M from C EC.
EV Clna r-ger rebates $,3 ,700 ,000 $266,447 Faici llirtated in sta llati o n o f 6 0 ,con necto r-.s at 1.2 sit es -o f wlh i c h
44 w e r-e reb ated _
Pr-ogira m Pa rti ci pati on Agre e m e n ts s ig ned w ith .37 s i tes . 52 site
IMlulti-Consulta n t f o r T ,e drn i ca,1 v j s i il:cs c o m p l e ted. 2 1. fi n.a,I r e p o rts delliivered. Follo w ·-u p , a cti o n by
fam,ily, !Non-Assi sta n c e (S,m a l l M e d i u m $,600 ,0 0 0 $1 82,8 0 0 b u il d i n g o w n ers has b e e n s l o w ed d u e t o t h e pa nde m i c but b u ildi n g
profits, and B u s i n esses als o e l igiblle)
permi t a pplicai1ti ons a r e starti n g to be s u b m itted -4 :s,o far-. As
S-i::litools tlnese a re appr o v e d , EV Charger-r e bate exp e n d i tur-es {aboV1e ) w i l l
i n crease a s Wlill rra ,nsfoirmer u p gir,ade ex1Pen d itures b e l o,w .
T r-ai n sform e 1r U pgr a d e s $800 ,0 0 0 $0
M u l tip l,e sites w ork i n g w i th T echnic al Assista n ce P r ogr a ,m w illl
requ ire transf e r-m e r up,g r-adles.
Si1lllgle A lli El e-c:t ni c H o m e I n cen t i v e s $,400,0 0 0 $0
T o d ate,. n ,o expen d i tures Fa,mily T r-ai n sform e r U pgr ades $,2 30,0 0 0 $0
llow-jl[nc:,c,..me Low -i n co m e EV pu r ,c h a s e
i n ,centJi v es $,300 ,0 0 0 $0 N ot y et i m p le m ent ed .
A d m i n i stratio n $,3 00,0 0 0 $200 ,000
Parti ally ,c over s EV pirogr a m m anagem e n t st a ff costs (H i iro m i +
Shiv a )
Ed u cat ion, M a ir keting a nd C Y 2018-2020: 4 w o r k s h o p s , 6 ride & dl r-iv e s , 2 Earth D a y event s,
.AIIII O u t r ea,c h $,1 0 0 ,0 0 0 $5-7,336 2 Nati o n a l D rive Electri c W eek e v e n ts, m a i n t e n ance o f EV
w ebpages, EV calc u lat or a nd v a ir ious co mmun i catJi o n m ate ri als.
IP i lot p r-ogr ai m s $,l..5 0 ,0 0 0 $0 D C f ast C h arger-P i 11ot R,at e i m pl1e m e n t e d F eb 2021
Oth er pr-ogr-a m s il:o b-e $,l..5 0 ,0 0 0 $0 N o pr-ogr-a m s i mpl e m ent e d y et. dete1rm i n e d
!Fleet u:s,e to cov e r-C N G Paym,e n t t o PW f o r-v a l u e o f LC FS cred irt s ,ea nne d by C N G
Payments to !P ump M a i nte n a nce $,1 0 0 ,000 $1 13,992 st:a t i o n s
Public Expe n s,es
W 'o iiks C o v e 1r Puibl ic EV C h argeir $,200,000 Pa yme n t t o PW f o r-v a l u e of LCFS cred iit:s eann e d by c ity o w n e d
Exp e nse and I n v estm e nts $229 ,0 19 EV c h arger-s
LCFS FUNDING TOTAL $9,030,000 -$ 1,943,249
4
EV CUSTOMER PROGRAMS UPDATE
EV Charger Rebate Program
Everything you wanted to know and more:
•CPAU has facilitated installations of 62 connectors
•Rebated 44 connectors
•Installed EV chargers @ 12 sites
7 non-profits (including 3 schools)
5 multi-family (including 1 mixed-use)
•Total spent $263K
•Average cost of each installation is a little over $10K
•Projects averaged XX days to complete.
~CITY OF
~PALO ALTO
5
EV CUSTOMER PROGRAMS UPDATE
EV Charging Technical Assistance Program(TAP)
•Program Participation Agreements signed with 37 sites
•Site Visits Completed: 52
•Number of Final Reports Delivered: 21
•Proposed total number of new EV Charging Ports: 226 @ 16 Multifamily Properties,
9 Places of Worship and 1 Non-Profit
•Number of Permit Applications Submitted: 4 @ 2 Multifamily sites and 2 Places of
Worship
•Number of new ports installed: 0
•Follow-up action by building owners has been slow due to the pandemic but there
are half a dozen projects preparing to submit permit applications in Q2 2021. As
these projects move forward, expenditures for EV Charger Rebates as well as
Transformer Upgrade expenditures will increase.
California Clean Fuel Rewards Program
•Statewide $1,500 point of sale EV rebate launched in
November 2020.
•To date, as mandated by CARB, CPAU has contributed
$890K of LCFS funds towards this statewide program
•April Utility Bill Insert marketing the program
The EV Ad visor Program
Broug httoyoubyCPAU ;AdministeredbyCLEAResult
~CITY OF
~PALO ALTO
1.Vlslta
participating
automotive retaller
2. Get a new vehicle
that Includes the
reward-up to $1,500 off!
3. Register
the vehlde In
Callfomla
This Instant electric vehlcle reward Is up to $1,500 (offered on a sliding
scale depending on battery size) and can be combined or stacked with
other appllcable federal. state or local post sale Incentives. For a full llst of
avallable Incentives, see reverse side.
6
EV CUSTOMER PROGRAMS UPDATE
Curbside Charging Pilot Program
•Proposal: Install publicly available curbside chargers at 10 pilot sites with electricity
supplied by resident homes. Permit application has been submitted for one site.
•Resident driven initiative and collaborative effort with Public Works, Planning and Utilities
•Expanding CPAU’s $8,000/port EV charger rebate to Curbside Charging Pilot
Income Qualified EV Rebate Program
•Starting 2022, Low Carbon Fuel Standard (LCFS) regulation will require CPAU to spend
up to 50% of LCFS revenue to support transportation electrification projects that
benefit low-income customers.
•Projecting $800K to $1M per year
•In progress: Drafting Memorandum “Defining Low-Income for LCFS Funded Programs”
CALeVIP (California Electric Vehicle Incentive
Project)
•Launched December 2020, and is oversubscribed with applications from 38
sites
•Projection: 200 new Level 2 EV Charging Ports and 10 new DCFC over the
next 3 years at commercial sites
•City awarded $1M from the CEC with CPAU contributing $1M in matching
funds
~CITY OF
~PALO ALTO
Imp ernemed by CSE for the
California Energy Commission
San Ma teo Co unty Santa Cl ara County Ci ty of Pal o Alto
City of Sanjose City of Santa Clara
■ Re m aining ■ Proi,•isiona lly Re se rved ■ Rese rved ■ Iss ued
51,000k
:S750k
:S5O0k
:S250k
10
DC Fast Olarger Fund5 Level 2 Olarger Funds
0% of funds have been reserved or issued co Disadvantaged and Low-Income
Commun ities _
$1 ,1 70,000 of ap plications rece ived in excess of DC fast charger funds .
$1 ,047,500 of ap pl ications rece iv ed in excess of Leve l 2 charger funds_
7
2021 PLANS FOR EV EDUCATION AND OUTREACH
Launch EV Myth Busters Campaign –
Focus on Cost of Ownership
•Collaborate with building electrification
education and outreach
•Utility Bill Inserts
•Social Media campaign
•Electronic newsletters
Virtual Workshops and Events
•2/25/2021 Hosted EV Technical Assistance Program Webinar for Private
Schools
5 schools attended (result of November/December call campaign)
All are interested in moving forward with installations (Bowman, Girls
Middle School, Kehillah, Palo Alto University, Stratford)
•Issued Electrification/EV Education and Outreach RFP through NCPA, Q3 2020
Contracts to be in place by Q2 2021
Vendors selected for EV Education and Outreach
•Charge Across Town
•D+R International
•Electric Car Insider
•Plug In America
•Acterra
~CITY OF
~PALO ALTO
Introducing Palo Alto's Electric Vehicle Charging
Technical Assistance Program (EV Advisor)
Brought to you by CPAU: Administered by CLEAResult
8
City-Owned Chargers as of January 2021
Site Charger Manufacturer # of Level 2 Ports Primary Use
Bryant St. Parking Garage -445 Bryant St.ChargePoint Powerflex 6 6 Public
Cambridge Parking Garage -475 Cambridge Ave.ChargePoint 10 Public
City Hall Parking Garage -250 Hamilton Ave.Powerflex 12 Public
Fire Station 3 -799 Embarcadero Rd.Flo 1 City Staff
High St. Parking Garage -528 High St.ChargePoint 8 Public
Mitchell Park Library -3700 Middlefield Rd.ChargePoint Powerflex 3 3 Public
Municipal Service Yard -3201 East Bayshore Rd.AeroVironment 2 City Vehicles
Rinconada Library -1213 Newell Rd.Powerflex 3 Public
Sherman Parking Garage -350 Sherman Ave.ChargePoint 33 Public
Ted Thompson Parking Garage -275 Cambridge
Ave
ChargePoint 8 Public
Water Quality Control Plant -2501 Embarcadero
Way
Clipper Creek 1 City Staff
Webster St. Parking Garage -520 Webster St.ChargePoint Powerflex 16 14 Public
TOTAL 116*
*Rapidly Expanding City-owned EV Chargers: As of the end of 2018: 76 ports, 2019: 90 ports
~CITY OF
~PALO ALTO
City of Palo Alto (ID # 12160)
Utilities Advisory Commission Staff Report
Report Type: New Business Meeting Date: 5/12/2021
City of Palo Alto Page 1
Summary Title: Presentation on REC Exchange Program
Title: Informational Update on REC Exchange Program for 2021 in Accordance
With the City's Amended Electric Supply Portfolio Carbon Neutral Plan
From: City Manager
Lead Department: Utilities
Executive Summary
On August 24, 2020 the Council approved amendments to the electric utility’s Carbon Neutral
Plan that clarified and modified policies regarding the sales and exchanges of renewable energy
credits (RECs) (Staff Report #11556). The amendments permitted the exchange of Bucket 1
(primarily in-state) RECs for Bucket 3 (primarily out-of-state) RECs, provided the City maintains
compliance with State Renewable Portfolio Standard (RPS) regulations. A portion of the
earnings from the program would be used to mitigate the economic impacts of the coronavirus
pandemic, and the remainder would be reserved for local decarbonization programs. The
amendments also adopted an hourly accounting methodology for managing the City’s electric
portfolio and permitted the use of Bucket 3 RECs for managing any emissions impacts identified
by the use of the hourly accounting methodology.
Since then, staff has purchased and sold RECs for Calendar Year 2020 in accordance with the
Carbon Neutral Plan amendments. And at the time of writing this report, staff was in the
process of planning to sell RECs for CY 2021. The attached presentation provides staff’s
projections for the program’s net earnings and its impacts on the City’s Power Content Label for
2021.
For 2021, staff projects $2.46 million in net earnings from the program. This is slightly lower
than the estimate staff provided to the UAC in March 2021 ($2.80 million); the difference is
primarily due to a significant decrease in hydro generation projections since then, which results
in the need to purchase additional Bucket 3 RECs to maintain compliance with the City’s Carbon
Neutral Plan.
This is an informational item and no Utilities Advisory Com mission action is requested.
Attachments:
•Attachment A: Presentation
Staff: Jim Stack
May 12, 2021 www.cityofpaloalto.org
REC EXCHANGE: CY 2021 UPDATE #2
Attachment A
•
CITY OF
PALO ALTO
2
REC EXCHANGE PROJECTIONS FOR CY 2021
Baseline
(No Sales)
REC Exchange
Program
Total REC Sales Volume (MWh)--274,600
Bucket 3 REC Purchase Volume (MWh)--276,380
Total REC Sales Revenue ($M)--$3.71
Bucket 3 REC Purchase Cost ($M)--$1.24
Net Revenue ($M)--$2.46
Bucket 1 RPS Level 67%33%
Projected REC Prices: $13.50 for Bucket 1, $4.50 for Bucket 3
~CITY OF
~PALO ALTO
3
ELECTRIC SUPPLY PORTFOLIO IMPACT (CY 2021)
• .
CITY OF
PALO
ALTO
~ ;:
:E
>
Q.
C.
::::s
V')
u
'i:
+,I u
~
LI.I
1,000,000
900,000
800,000
700,000
Solar
600,000
500,000
Wind
400,000
300,000
200,000
100,000
--------------~
"Unspecified
Power"
(Market Power+
Unbundled RECs)
Total Load
(823,499 MWh) ---
So lar
4
POWER CONTENT LABEL IMPACT (CY 2021)
Base Portfolio With REC Exchange
RPS Level: 67%
Emissions Intensity: 7 kg CO2/MWh
RPS Level: 35.75%*
Emissions Intensity: 142 kg CO2/MWh *Including eligible
Bucket 3 REC
Purchases
CITY OF
PALO
ALTO
38% 389'
■ Large Hydro ■ Land f ill Gas ■ Wind ■ Solar ~ Unspecified Power
5
POWER CONTENT LABEL IMPACT (CY 2021)
Base
Portfolio
After REC
Exchange
Eligible Renewable 67%33%
Biomass 13%4%
Geothermal 0%0%
Small Hydro 1%1%
Solar 40%24%
Wind 13%2%
Coal 0%0%
Large Hydro 33%38%
Natural Gas 0%0%
Nuclear 0%0%
Unspecified Sources 0%29%
Emissions Intensity
(kg CO2/MWh)7.0 128.0• .
CITY OF
PALO
ALTO
Jim Stack, Ph.D.
Senior Resource Planner
james.stack@cityofpaloalto.org
(650) 329-2314
CITY OF
PALO
ALTO
City of Palo Alto (ID # 12254)
Utilities Advisory Commission Staff Report
Report Type: Supplemental Information Meeting Date: 5/12/2021
City of Palo Alto Page 1
Summary Title: Hydro Rate Adjuster Update
Title: Informational Report on Non -Activation of the Hydro Rate Adjuster for
FY 2022, and Projections for Future Hydrologic Scenarios
From: City Manager
Lead Department: Utilities
Recommendation
This report is for information only. No action is required.
Executive Summary
While California’s precipitation has been lower than normal during FY 2021 and hydroelectric
generation levels are projected to remain below normal for FY 2022, staff projects the
Hydroelectric Stabilization (HS) Reserve level for FY 2022 will remain within Council-adopted
guidelines. As such, Staff does not recommend Council activation of the Hydroelectric Rate
Adjuster (HRA) for FY 2022.
This background on the City’s Electric Hydroelectric Rate Adjuster (Utility Rate Schedule E-HRA),
and projections of possible future hydrological scenarios is provided for Council’s information,
in advance of the City’s upcoming budget adoption. In an effort to manage the financial
impacts of the annual variability in production of the City’s hydroelectric resources, and to
allow for the City to maintain a lower target level for its Hydroelectric Stabilization (HS)
Reserve, the City adopted a Hydroelectric Rate Adjuster (HRA) mechanism effective July 1, 2018
(CMR 8962, March 19, 2018).
The objective of the HRA is to pass through to customers some portion of the variation in the
utility’s costs resulting from changing hydroelectric conditions. It does this by temporarily
adjusting Electric rates upward or downward in response to hydroelectric conditions and HS
Reserve levels, in order to maintain a reasonably stable level of ongoing financial reserves. Th e
HRA, shown on Utility Rate Schedule E-HRA, is activated via Council approval, typically with the
adoption of the budget for the upcoming fiscal year. Activation of the HRA ensures cost
recovery through a temporary rate adjustment simultaneous with drought conditions, allowing
greater transparency and simpler communication about the reason for the rate changes. It
avoids the need to resort to larger, more permanent rate changes that occur after the end of
Staff: Eric Keniston
CITY OF
PALO
ALTO
City of Palo Alto Page 2
the drought, which is more difficult to explain to the community. This adjustmen t is only made
when extended periods of high or low rainfall lead to depletion of HS reserves or excess
accumulation of reserves.
Background
The City of Palo Alto is fortunate to have access to a large amount of relatively low -cost,
carbon-free hydroelectric generation to meet a large portion of its electric supply needs.
Whereas hydroelectric generation provides about 10% of the overall electric supply for the
state as a whole, the City meets about 50% of its electric supply needs with hydroelectric
generation in an average year.
However, maintaining such a heavy reliance on hydroelectric generation means that the output
of these resources is highly sensitive to weather conditions. Although the City receives about
50% of its electric supplies from its hydroelectric resources in a “normal” weather year, that
amount can fall to as low as 25% in extremely dry years. And unlike many of the City’s supply
contracts, where the cost of the resource is proportional to the amount of generation
delivered, the City pays a mostly fixed amount every year for the output of its two hydroelectric
resources (Western Base Resource and the Calaveras project) regardless of the amount of
electricity they produce. This is due mostly to the fixed costs required to operate and maintain
the hydroelectric facilities. Meanwhile, the City must also purchase additional supply resources
(generic market power and, to comply with the Carbon Neutral Plan, renewable energy
certificates, or RECs) to make up for the reduced hydroelectric outp ut in these dry years.
Compounding the problem, market power prices are often higher in dry years, when the City
must purchase more, because the entire state is experiencing reduced supply conditions.
To mitigate against these dry year, high cost conditions, the City maintains a Hydroelectric
Stabilization Reserve (the HS reserve). The City Council approved an Electric Hydroelectric Rate
Adjuster (HRA) effective since July 1, 2018 (CMR 8962, March 19, 2018). Since its inception, the
HRA has not been activated because every year since adoption either 1) the balance of the HS
Reserve has been within target ranges (above $11 million but below $27 million) or 2) projected
hydroelectric generation has been at or above normal annual output levels.
As designed, a decision on whether or not to recommend activation of the HRA is made in late
April or early May each year (at the tail end of the rainy season) and is applied to customers’
electric rates for the duration of the following fiscal year. The determination of whether or not
to apply the HRA, and at what adder/discount level, is based on the projected amount of
hydroelectric generation for the upcoming fiscal year, relative to th e amount expected in a
“normal” year, and the expected level of the HS Reserve at the start of the upcoming fiscal
year. A graphical depiction of how the HRA mechanism is applied based on varying levels of HS
Reserves and hydroelectric conditions is displayed in the chart below.
The HRA can be activated at two different levels to increase revenues, and at three different
levels to return excess reserves and revenues to customers. When reserves are projected to be
City of Palo Alto Page 3
below $11 million, the HRA is activated at the $0.0065/kWh level if hydroelectric generation is
below average, and at the $0.0130/kWh level if very low (less than one standard deviation
below average). For reference, the current average annual hydroelectric generation total is 480
Gigawatt-hours (GWh)1, with one standard deviation below average being 319 GWh, and one
standard deviation above average being 642 GWh. The lower HRA level, $0.0065/kWh,
represents a temporary 4% rate increase based on current system average rates, while the
higher level, $0.0130/kWh, represents a temporary 8% rate increase. The chart below
represents guidelines for activation, but staff may recommend (and the Council may adopt) a
different course of action than is shown in the chart depending on its assessment of current
conditions.
Since adoption, and up until the 2020-2021 water year, reserves have been higher than the
25% level ($11 million), and hydroelectric generation has not been low enough to trigger the
HRA.
1 When Council adopted the HRA rate schedule in 2018, an average year’s total hydro output level was 548 GWh. However,
shortly after Council adopted the HRA, Staff, working with the operators of its two hydro facilities, re-evaluated these projects’
historical output levels. This analysis found that, based on changes in climatological conditions and environmental policies in
recent years, the average annual generation amount from these facilities had dropped to 480 GWh. Similarly, the +/- 1 standard
deviation levels for the two projects had fallen from 364 GWh and 733 GWh, to 319 GWh and 642 GWh. Accordingly, Staff
proposes to update the HRA rate schedule to reflect these changes in long-term average hydro generation levels when all rates
go to Council in June 2021.
Hyd ro Rate A d just,er Level (in cents/kWh)
•II I I I I I I• I I I I :
Max : : :_:_:_:_:_:_:_:_:_:_:_:! -0.65 -0.65 ·-. -·r-------------·r-··-----------($35 M) : : : : ; ,
•' •' J I . . ,:,.I
•.· -· · · · · · · -·-·-: -0.65 ·-·.-.-·:·:·:·:'.·:·:··· ..... .''.':·:···.-·-:-:·:·:'.·:1 -1.30
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-1 Std . Dev. No nnal Year
·Ge ne.rat io n
Total Hydro Gen,eration
City of Palo Alto Page 4
In FY 2020, staff brought the HS Reserve to $15.4 million in preparation for future dry
hydroelectric conditions. The 2020-2021 water year has been significantly lower than average,
however, so staff is completing this assessment to evaluate the need for activating the HRA.
While staff is not recommending activation of the HRA for FY 2022, staff wants the UAC and
Council to be aware of the potential for activation in FY 2023 in the event of a dry 2021 -2022
water year.
Projections
Based on current analysis, FY 2021 hydroelectric generation is projected to be 120 GWh lower
than normal, which is slightly greater than one standard deviation below average. An early
estimate of the additional cost incurred in FY 2021 due to lower hydroelectric generation is
$4.37 million, but this difference has already been a ccounted for in the FY 2022 Financial Plan,
so staff does not recommend removing funds from the HS Reserve to fund this additional
expense2.
Given the above conditions, the beginning HS Reserve level for FY 2022 is currently projected to
be $15.4 million, which is within the HS Reserve ‘target’ range of $11 million to $27 million. As
such, the HRA would not need to be activated for FY 2022. However, staff analyzed the
potential that the HRA would be needed in FY 2023 in case decisions about the FY 2022 HRA
affect the likelihood of needing to activate the HRA at its highest level in FY 2023.
Scenarios:
Staff evaluated three potential hydroelectric and rate impact scenarios for FY 2022 and FY
2023. In each scenario hydroelectric generation is assumed to be one standard deviation below
normal for both the 2020-2021 water year (which primarily affects FY 2022) and the 2022-2023
water year (which primarily affects FY 2023). Staff modeled different strategies for activating
the HRA and the outcomes resulting from each strategy:
• In Scenario 1, hydroelectric generation is one standard deviation below average (319
GWh) in both years, resulting in higher costs, and no HRA is implemented in either year;
• Scenario 2 assumes the HRA is implemented in FY 2023 at the $0.0065/kWh level, a
temporary approximate 4% rate increase:
o Scenario 2a assumes hydro conditions are one standard deviation below normal
(319 GWh) in both FY 2022 and FY 2023;
o Scenario 2b assumes an ‘extreme dry’ scenario of 240 GWh in FY 2023. In this
scenario, the HS Reserve may only be slightly above the minimum guideline level
($3 million) at the end of FY 2023.
• Scenario 3 has the same hydroelectric generation and cost assumptions as Scenarios 1
and 2 but assumes the $0.0065 HRA is implemented in both FY 2022 and FY 2023.
2 The mechanics for adding to or withdrawing from the HS Reserve are not outlined in the reserve guidelines. Staff’s practice to
date has been to avoid using this reserve unless hydroelectric conditions are outside of the +/- one standard deviation range.
Staff intends to review this policy before adoption of the FY 2023 Financial Plan and clarify it in the reserve guidelines.
City of Palo Alto Page 5
Scenario 1Scenario 2aScenario 2bScenario 3
No HRA
HRA in FY
2023HRA in FY 2023
HRA in FY 2022
and FY 2023
FY 2022 Beginning Reserve Balance 15,400,000$ 15,400,000 $ 15,400,000 $ 15,400,000 $
Cost increase at 319 GWh (7,620,000)$ (7,620,000)$ (7,620,000)$ (7,620,000)$
HRA at $0.0065/kwh5,283,135 $
FY 2023 Beginning Reserve Balance 7,780,000$ 7,780,000 $ 7,780,000 $ 13,063,135 $
Cost increase at 319 GWh (6,530,000)$ (6,530,000)$ (6,530,000)$
Cost increase at 240 GWh(10,520,000)$
HRA at $0.0065/kwh5,505,279 $ 5,505,279 $ 5,505,279 $
FY 2024 Beginning Reserve Balance 1,250,000$ 6,755,279 $ 2,765,279 $ 12,038,414 $
Based on the current guidelines, staff is not recommending the HRA be implemented for FY
2022 given current HS Reserve levels. However, it is possible that staff may need to transfer
more than $7.6 million from the HRA in FY 2022, should hydro conditions be lower than one
standard deviation from normal, and the City may enter FY 2023 with reserves lower than $7.78
million. If combined with very low precipitation in the 2021-2022 water year, it could lead to as
much as an 8% temporary increase in rates if the City needs to activate the HRA at its highest
level to recover increased drought-related supply costs. This is only one scenario, but it is worth
noting due to the possibility of this outcome in FY 2023. If it were unacceptable to the
community to activate the HRA at that level, alternatives could include a loan from the ESP
Reserve, assuming funds are available.
Staff does not recommend Scenario 3. While staff estimates Scenario 3 will keep HS Reserves
within the target range of $11 million to $27 million, it would go against the current policy of
implementing the HRA if HS Reserves are below the minimum target level ($11 million). If HS
Reserves do fall below the $11 million level at the end of FY 2022, staff would make a
recommendation on the HRA level for FY 2023 in May of 2022.
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