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Home My WebLink About0482.092\,: ,4 • 2 October 29, 1992 THE HONORABLE CITY COUNCIL Palo Alto, California R@solutigD re Master Water Sales Contract Members of the Council: Report in Brief This staff report requests Council approval of a resolution suspending a provisicn of the Master Water Sales Contract between the City and County of San Francisco and the Suburban ~~rchasers. Palo Alto is a party to this contract and one of the 30 Subu~ban P' .. a·ct.asers that make up the Bay Area Water Users Association ,Association). suspension of this section of the contract will resolve a potential conflict hetween allocation of future ~ater supplies ana the ~andatory water rationing program enacted by the San Francisco Public utilities commission (SF?uC)~ Background In 1974, Palo Alto initially filed a lavsuit. with the remaining agencies joininq later, against the City and county of San Francisco to prevent suburban water rates from becoming higher than that ~hich San Francisco customers pay. Durinq the period of 1978 through 1984# the parties to this civil action engaged in extensive s~ttlement negotiations in an effort to resolve outstanding differenc€:s ar.d provide a neiol" framework for future relationships. The negotiations resulted in the ~Settlement Agreement and Master water Sales Contract bet~een the City and County of san Francisco and Certain Suburban Purchasers in San Mateo, Santa Clara and Aiameda Counties· (Agreement). Palo Alto signed the Agreement on June S, 1984, in accordance with the resolution adopted by Council on May 21, 1984. piscussion Under the 1984 Agreement, San Francisco committed to deliver water to the 30 Suburban Purchasers, at prices determined by the Agreement's detailed formulas. CXR.482.92 -__ "C, ___ - .". / ,'. FUture-water supply is to be allocated among the individual suburban agencies by the method described in se~tion 1.02 of the Agreeaent4 Section 7.02 provides that if the agencies do not agree amo~9 themselves as to how the additional water should be allocated, it will be allocated based on the average use during the previous three-year p~riod. The Aqreement provides tor the suspension of section 1.02, at the direction of the Suburban Purchasers, for a tim~ period in which water consumption patterr.s are unusual. In d.oi;r;q so, the unanimous concurrence by the 26 Suburban ?~rchaser$ who are involved in the allocation process is re~~ired. (Four purchasers are not affected due to telDporary st<ltU$ or individual supply contracts that predate the 1984 Agreement.) Each year since the beginning 'oJf the six-year drought, Palo Alto and other BAWUA members have been called upon to adopt resolutions to suspend Section 7.02. Because of the continuing' dro'l.1,ght, it is necessary that the BAWUA membership acopt a resolution to suspend section 7.02 of the Agreement for FY 1992-93. Recgmmendation Staff recommends that council approve t.~e at.tached resolution suspendinq use of water consumption in Fiscal Year 1992·93 froa the vesting procedures of the San Francisco Water Department Master Agreement, conditional upon similar ~ction by all remaining suburban purchasers affected by the allocation process. ReSpectfUllY\ su~mi tted, l,5Y-rll."--c.1:::-:: --~"'--__ BLAKE HEITZMAN Senior Power Engineer 7~ 2t1-~" '~r~ • I rr CHARD L. YOUNG·j ~ ector of U~tr1ties V 7/, ~ t----=v-'-;~ FIlEMING . . I erim City Manager 'J ---./ Attachment: Resolution CX1U482:9Z .. ~ ..... '. ........ '-"----' ... -......... "--,--~, .... --~- RESOLUTION SO. RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO SUSPENLING OPERATION OF SECTION 7.02 ibl OF SE'M'LEMENT AGREEMElJT AND MASTER WATER SALES CONTRACT WITH THE CITY AND COUNTY OF SA." FRANCISCO FOR FISCAL YEAR 1992-9l The Council of the City of Palo Alto does RBSOLVE as follows : WHEREAS, the City of Palo ~to obtains water from the San Francisco Dtopartment ("SFWDiI} pursuant to the tertI's of a Set':lement Agreement and Master Water Sales CO:ltract with t,he City and County of San Francisco {·Contract') and a Wate'.:!' PUrchas~ Cont.ract with the San Francisco Public Utilities Cornrn.issiol1, each of which was entered into in 19S4; and WHEREAS, the San Francisco Fublic Utilities Commission, or:. May B ~ 1990, declared a water shortage emergency and. adopted a mandatory Water Conservation Program. including water rationing and excess use charges~ the goal of which is to reduce significantly the consumption of water supplied by the SFWD within ite service area; and WHEREAS, on April 23, 1992, the San FrancisCO Public Utilities CorNl"d.ssion concluded that a ",ate:; shortage emergency condition continued, as a result of a sixth consecutive year of below-nor.mal precipitation; and WHBRBAS, the mandatory Water Conservation program is expected to rema.in in effect until at least Spring 199:); thus, water ratior..ing will be i..mpDsed by the SPWD on its wholesale customers for the ~4jority of P~scal Year 1992-93; and WHEREAS, the Contract provides a methodology by 'Which individual whOlesale customer's entitlements to the overall Supply Assurance made by San Frar:cisco are determined and unless the wholesale customers otherwise agree, this deterITlination is based on ~ter usage by individual wholesale customers; and WHERRAS, the provisions of the Contract that determine permanent entitlements to a portion of the overall Supply Assurance based on water ueed are not compatible with effo:::-ts by all the wholesalt!! customers to redl1ce conslAt1ption of SFWD water and. thus, these provisions should. therefore, be suspended in response to the enactment of the mandatary Water Conservation Program by the San Francisco Public Utili ties Commission and the actions by this agency and the other 'Wholesale customers to encourage water .:::onservation; NOW. Th'""EREFORE~ the City of Palo Alta does hereby R£SOLVE as follows: 1 • . . . . : ., .. / SECTION l. Subj ect to the provisionB of Section 3 of this Resc>lution. the provisions of Section 7.02 (b) of the Contract dealing with the allocation of that portion of the Supply Assurance designated as "s·..lburban allocable water N shall be suspended as to water used by wholesale customers during Fiscal Year 1992-93 (i.e., July 1, 1992 -June 30 .. 1993). Water usage during such time peri·Jd ~ill not be used for any purpose in determining permane~t entitlements of the wholesale customers to suburba.n allOCable wat.er. SECTIQN 2, In all other respects, Section 7.D2(b) of the Contract shall r~ain in full for~e and effect and shall operate without modification a8 to wat.er used during all years oth!?r than Fiscal Year 1992-93, commencing with Fiscal Year 1993-94. SRCTION..1...... This Reaolutior.. shall become effective upon adoption of resolutions of like tenor (or other similar action) by each of the other wholesale customers similarly affe~ted uy Section 7.02 (h) on cr before June 30~ 199.3. If each of t.he ':Jther similarly affected wholesale customers has not adcp~ed a resolution of like tenor (or taken other similar action) by June 30; 1993, then this resolution shall be of no further force or effect and the proviSiOns of Section 7.02 (b) of the Contract shall apply to water used during Fiscal Year 1992-93 in accordance with the terms of the Contract. SECTION 4 The act ion significant environmental effect Environmen~al Quality Act. rNTRODUCED AND PASSED: AYES: NOES: ABSTENTIONS: ABSENT: A'ITEST: City Clerk APPROVED AS TO FORM: Sr. ABsi8ta~t City Atto~ney Director of Utilit1T·";:e-=.:------ taken hereunder will have no for purposes of th'? California APPROVED: Mayor City Mar..ager Di rectorC-o"'f-;F"i-'n",a"n"c"---e -----