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HomeMy WebLinkAbout2000-07-10 City Council (17)TO: FROM: City of Palo Alto City Manager’s Report HONORABLE CITY-COUNCIL CITY MANAGER DEPARTMENT: UTILITIES 4 DATE: SUBJECT: JULY 10, 2000 CMR:311:00 RESOLUTION RECOMMENDING THAT THE SAN FRANCISCO PUBLIC UTILITIES COMMISSION TAKE PROMPT ACTION TO IMPROVE REGIONAL WATER SUPPLY RELIABILITY AND QUALITY RECOMMENDATION Staff recommends that Council adopt the attached resolution by which the Council of the City of Palo Alto urges the San Francisco Public Utilities Commission (SFPUC) to take prompt action to improve regional water supply reliability and quality. BACKGROUND On March 22, 2000, the City Council received an information report on water supply reliability issues (CMR: 170:00). Attached to CMR: 170:00 was a report from the Bay Area Water Users Association (BAWUA) titled "The Future of Our Water Supplies". The report was intended to raise issues of concern to BAWUA agencies to the level of local elected officials. In addition, BAWUA hosted a symposium on April 17 to discuss those concerns with elected officials. Following the symposium, on April 25, a large group of elected officials (including Council Member Bern Beecham) appeared at a meeting of the SFPUC to support adoption of the’recommendations that resulted from the recently completed Water Supply Mast ~.~ Plan. The appearance by those representatives was a dramatic statement to the SFPUC c~ the level of importance placed by the BAWUA agencies on the issues related to the management of the regional water supply system. DISCUSSION BAWUA’s report described the expectations it has of SFPUC. These seven expectations can be thought of as criteria to be used in evaluating the options available to BAWUA. No options can be pursued without the assistance and support of the political representatives of the BAWUA agencies. CMR:311:00 Page 1 of 2 To further communicate these expectations, all BAWUA agencies have been encouraged to send the attached resolution to the SFPUC. The resolution will document to the SFPUC that Palo Alto supports the objectives outlined in the BAWUA report, "The Future of Our Water Supplies". The seven expectations of SFPUC are listed in the resolution and will provide to the SFPUC the assurance that Palo Alto supports these policy objectives. RESOURCE IMPACT Staffresources are already committed to the effort to preserve and protect Palo Alto’s main water supply source. Therefore, there are no new resource impacts that would result from approving this resolution. POLICY IMPLICATIONS The resolution does not change any existing policy or add any new policies. ENVIRONMENTAL REVIEW Sending the attached resolution does not constitute a project under the California Environmental Quality Act and, therefore, is exempt from the environmental assessment requirement. ATTACHMENTS 1. Resolution: Recommending that the San Francisco Public Utilities Commission take prompt action to improve regional water supply reliability and quality o CMR: 170:00: Report to Members of the Bay Area Water Users Association: the Future of Our Water Supplies (without attachments) PREPARED BY:Jane Ratchye, Senior Resource Planner Girish Balachandran, Supply Resource Group Manger DEPARTMENT HEAD ’APPROVAL: CITY MANAGER APPROVAL: of Utilities EMILk~"~HARRISON Assistant City Manager CMR:311:00 Page 2 of 2 RESOLUTION NO. RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO RECOMMENDING THAT THE SAN FRANCISCO PUBLIC UTILITIES COMMISSION TAKE PROMPT ACTION TO IMPROVE REGIONAL WATER SUPPLY RELIABILITY AND QUALITY WHEREAS, the City of Palo Alto ("City") provides water to 62,000 residents and 2,200 businesses providing jobs for 91,000 people; and it has purchased water for these customers from the City and County of San Francisco ("San Francisco") since 1939; and WHEREAS, the Hetch Hetchy water system ("System") is like an artery carrying an essential element of the lifeblood of the community, and the community’s economic power provides an important foundation for the Bay Area’s vitality and way of life; and WHEREAS, the Mayor of San Francisco has publicly noted the regional importance of upgrading the System and, in January, he released a certain Facility Reliability Report, citing the potential for extended interruptions in supply from San Francisco’s regional water system for up to 90 days, endangering an economic vitality and job potential that are the envy of the rest of the world; and WHEREAS, in February, 2000, the California State Auditor issued a report criticizing the San Francisco Public Utilities Commission’s ability to implement capital improvements to the System and suggests that the Commission may be unable alone to raise sufficient funds to pay for them; and WHEREAS, in April, 2000, the San Francisco Public Utilities Commission approved the Water Supply Master Plan ("WSMP"), a welcome indication of the Commission’s desire and intention to meet System-wide demands expected over the next 30 years, and, in so approving, stated its intention to adopt coordinated long-term financial and capital improvement program plans; and WHEREAS, these steps, while necessary, are not sufficient in themselves to assure the suburban agencies that 000705 cl 0071899 1 their concerns will be addressed, or that they will be addressed in a lasting manner; NOW, THEREFORE, the Council of the City of Palo Alto does RESOLVE as follows: SECTION I. In light of the above-stated concerns, and in order to provide the San Francisco Public Utilities Commission with a clear statement of its neighboring customers’ expectations, the Council of the City of Palo Alto joins with other similarly situated agencies, collectively responsible for supplying water to over 1.4 million residents and to industries, businesses and institutions which provide jobs for over 800,000 Californians (including many San Franciscans), in respectfully urging the Commission to do the following: (a)Take immediate steps to safeguard the System against damage from earthquakes and other hazards. (b)Secure negotiated water transfer agreements for back-up supplies during dry years in order to "drought proof" the overall service area for existing customers. (c)Implement diligently the elements of the WSMP so high priority short-term projects are built on the schedule contained in the WSMP. (d)Commit to operating the System to produce water as the first priority, with electric power as a byproduct. (e)Continue to protect the purity of Hetch Hetchy water and commit to providing its wholesale customers with water that meets applicable EPA and State of California drinking water standards. (f)Commit to fair water rationing methods; a new shortage allocation system is needed which does not penalize long-term conservation efforts or development of alternative supplies such as recycled water. It should be in effect by the end of this calendar year. (g)Commit to maintaining cost-based pricing on a long-term basis, after 2009, with the cost of the 000705 c10071899 2 wholesale water system continuing to be allocated between San Francisco and its wholesale customers based on their proportionate use. SECTION 2. To the extent independent actions by the San Francisco Public Utilities Commission can accomplish these objectives, we urge the Commission to undertake them now and pursue them diligently to completion; and SECTION 3. To the extent accomplishment of these objectives requires agreements between the City and County of San Francisco and its wholesale customers, we urge the San Francisco Public Utilities Commission to promptly begin formal discussions with the Bay Area Water Users Association, which represents our interests, and pursue them in good faith so that mutual and reciprocal commitments of both San Francisco and wholesale customers can be incorporated into durable and enforceable contracts on which all parties can prudently rely in ordering their affairs. SECTION 4. The Council finds that the adoption of this resolution is not a project under the CEQA Guidelines and, therefore, no environmental review is required. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST:APPROVED: City Clerk APPROVED AS TO FORM: Senior Asst. City Attorney Mayor City Manager Director of Utilities 000705 el 0071899 3 City of Palo Alto City Manager’s Report TO:HONORABLE ~2ITY COUNCIL FROM: DATE: CITY MANAGER MARCH 20, 2000 DEPARTMENT: UTILITIES CMR:170:00 SUBJECT:REPORT TO MEMBERS OF THE BAY AREA WATER USERS ASSOCIATION: THE FUTURE OF OUR WATER SUPPLIES This is an informational report and no Council action is required. BACKGROUND Since 1962, Palo Alto has purchased all of its water from the City and County of San Francisco (CCSF) except for a small amount from its wells during the 1976-77 and 1987-92 water shortages. The current relationship with CCSF is contractual, governed by the Settlement Agreement and Master Water Sales Contract (Agreement) which was signed in 19.84 and will expire in 2009. All twenty-nine agencies that purchase water on a wholesale basis from CCSF have substantially similar contracts. These twenty-nine agencies formed the San Francisco Bay Area Water Users Association (BAWUA) in 1958 to pursue their common interests in their.relationship with CCSF. The agency at the CCSF that administers the Agreement and controls the water system is the San Francisco Public Utilities Commission (SFPUC). The Agreement deals primarily with cost allocation issues. BAWUA agencies pay for about 2/3 of the SFPUC system costs since they use about 2/3 of the water produced by the system. However, the BAWUA agencies have no political representation at the SFPUC and no mechanism to contribute in a meaningful way to decisions made with regard to system operations, maintenance, or capital improvements. This lack of representation has become a problem. The State Auditor has confirmed BAWUA’s concerns that the SFPUC is slow to respond to vulnerabilities in its system. Attached to this report is the summary of the CMR:170:00 Page 1 of 3 February 17, 2000 report by the Califomia State Auditor which concludes that since SFPUC has been slow to upgrade its system, the agencies who rely on the SFPUC for water are at "greater risk of disruptions and water shortages if an emergency or drought occurs." The highly critical report also notes that the SFPUC has proposed a capital improvement program of more than $3 billion to address many of the concerns raised, but has been stymied in its implementation by .institutional and organization constraints. These planned capital improvements, if ever completed will more than double SFPUC’s rates. However, a bigger problem may be that the projects are not completed in a timely fashion. In its own studies, the SFPUC has admitted that its system is vulnerable to natural disasters such as earthquakes. In fact, the SFPUC’s Facility Reliability Study (released on January 21, 2000) showed that Palo Alto could be without water from San Francisco for periods up to 60 days. It has also been clear since 1986 that the system cannot provide adequate supplies of water to its customers. However, the SFPUC has not yet increased the system’s reliability from a water supply perspective and has not been able to complete the capital projects it says are necessary to upgrade the system. DISCUSSION Palo Alto, along withthe other BAWUA agencies, has a duty to its constituents to ensure that their water supplies are safe, reliable and operated in a cost-efficient manner. Since the SFPUC cannot provide assurance of such service, BAWUA agencies have been forced to develop alternative approaches. As its first effort in this area, BAWUA has developed a set of "expectations", or performance standards, for its relationship with the SFPUC. In order to communicate these expectations, BAWUA has prepared the attached report titled "The Future of Our Water Supplies". This document is intended to raise issues of concern to BAWUA agencies to the level of local elected officials. In addition, BAWUA plans to host a symposium in April or May to which City Councilmembers will be invited. After the symposium, a resolution supporting the future direction of BAWUA’s advocacy efforts will be introduced to the City Council. Part One of the report provides a background and context of SFPUC’s water system and its relationship to the BAWUA agencies. The report describes, what SFPUC has done and what remains to be done. It concludes that BAWUA agencies will need to examine other options than relying on SFPUC if their needs cannot be met through the existing relationship. Part Two lists BAWUA’s expectations of SFPUC. These seven expectations can be thought of as criteria to be used in evaluating the options available to BAWUA. No options can be pursued without the assistance and support of the political representatives of the BAWUA CMR:170:00 Page 2 of 3 agencies. RESOURCE IMPACT This re_port is informational only; therefore there are no resource impacts. POLICY IMPLICATIONS This report is informational only; therefore there are no policy implications. ATTACHMENT Attachment 1: Report to Our Members from the Bay Area Water Users Association: The Future of Our Water Supplies ,, Attachment 2:Summary from the February 17, 2000 State Auditor’s report: San Francisco Public Utilities Commission, Its Slow Pace for Assessing Weaknesses in its Water Delivery System and for Completing Capital Projects Increases the Risk of Service Disruptions and Water Shortages PREPARED BY:Jane Ratchye, Utilities Senior Resource Planner Girish Balachandran, Supply Resource Group Manger DEPARTMENT HEAD APPROVAL: f ..~/_~./2/~//~. ~ Bties Director ~ ~ Manager CMR:X_XX:99 Page 3 of 3