HomeMy WebLinkAboutItem 3h: Lease with City of Alhambra for Water Production Rights in San Gabriel Basin •
0000%4 4
1! 1 liFcti
7.4,fY3
STAFF REPORT
Public Works Services Department
DATE: June 19, 2012
TO: Honorable Mayor and City Council
FROM: Tom Tait, Public Works Services Director
By: Ken Herman, Deputy Public Works Services Director
SUBJECT: AUTHORIZE THE CITY MANAGER TO EXECUTE A LEASE
AGREEMENT WITH THE CITY OF ALHAMBRA FOR 2,000 ACRE FEET
OF FISCAL YEAR 2011-12 WATER PRODUCTION RIGHTS IN THE
MAIN SAN GABRIEL BASIN FORA TOTAL COST OF $1,152,000
Recommendation: Approve
SUMMARY
Each year the City of Arcadia is allowed to pump a specified quantity of water from the
Main San Gabriel Groundwater Basin (Main Basin) free of Replacement Water
assessments. For Fiscal Year 2011-12, the City of Arcadia's pumping right was set at
8,885 acre-feet of water. The quantity of water pumped over the City's pumping right is
replaced by purchasing Replenishment Water. This Fiscal Year, it is estimated that the
City's Replacement Water obligation will be approximately 2,785 acre-feet. Additionally,
the Replacement Water assessment is $640 per acre-foot if purchased through the
Main San Gabriel Basin Watermaster (Watermaster).
The City of Alhambra has offered to lease the City of Arcadia 2,000 acre-feet of water
rights for a unit cost of $576 per acre-foot for a total cost of $1,152,000. This lease will
save the City $128,000. It is recommended that City Council authorize the City
Manager to execute a lease agreement with the City of Alhambra for 2,000 acre-feet of
FY 2011-12 water production rights for a total cost of$1,152,000.
DISCUSSION
In 1973, as a result of overproduction of water from the Main Basin, a stipulated
judgment was entered into that created the Watermaster. The Watermaster is a nine-
person board appointed by the Los Angeles County Superior Court that administers and
enforces the provisions of the Main San Gabriel Basin Judgment, which established
water rights and responsibility for efficient management of the quantity and quality of the
Main Basin's groundwater.
Honorable Mayor and City Council
June 19, 2012
Page 2 of 2
This is accomplished in part by the Watermaster determining the total amount of water
that can be pumped from the Main Basin each year, which is referred to as the
Operating Safe Yield. The City of Arcadia's share of the Operating Safe Yield, free of
assessments, is 4.23%. Although there is no limit on the quantity of water that may
actually be pumped by agencies from the Main Basin, groundwater production in excess
of the City's annual share requires purchase of Replacement Water to recharge the
Main Basin.
For FY 2011-12, the City of Arcadia was allowed to pump 8,885 acre-feet of water from
the Main Basin. This year, the City is projected to pump 11,670 acre-feet of water. As
a result, the City's total over production is estimated to be 2,785 acre-feet. Accordingly,
the City is responsible to purchase Replacement Water to account for the over
production. The cost from the Watermaster for Replacement Water for FY 2011-12 is
$640 per acre-foot. Normally, the City would be billed by the Watermaster in July for
the City's total over production at the $640 per acre-foot rate.
However, the City of Alhambra has determined that they will not pump all of their
adjudicated rights for this Fiscal Year and has offered to lease the City of Arcadia 2,000
acre-feet of water rights at a cost of $576 per acre-foot (90% of the rate set by the
Watermaster), for a total cost of $1,152,000. These additional pumping rights can be
used to partially satisfy the City's obligation for Replacement Water. June 30, 2012 is
the end of the Fiscal Year, at which time, the City will know exactly how much water
was produced for the Main Basin. It is estimated that the City will need to purchase an
additional 785 acre-feet at the FY 2011-12 Assessment Rate of $640 per acre-foot. The
purchase of Replacement Water at 90% of the Replacement Water assessment rate is
prudent and will save the City $128,000. The City has done similar water rights leases
in the past with producers in the Main Basin.
FISCAL IMPACT
Sufficient funds have been budgeted in the FY 2011-12 Water Operations Fund for the
purchase of FY 2011-12 Replacement Water. The purchase of water under this
agreement would save the City $128,000 in the Water Operations Fund.
RECOMMENDATION
It is recommended that City Council authorize the City Manager to execute a lease
agreement with the City of Alhambra for 2,000 acre-feet of FY2011-12 water rights
in the Main San Gabriel Basin for a total cost of$1,152,000.
APPROVED:
Dominic Lazza t o
City Manager