FOX CANYON GROUNDWATER MANAGEMENT AGENCY A S'fA'f.E OF CALIFORNIA WAHR AGENCY

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1 FOX CANYON GROUNDWATER MANAGEMENT AGENCY A S'fA'f.E OF CALIFORNIA WAHR AGENCY BOARD OF DIRECTORS Eugene F. West, Chair, Director, Camrosa Water District David Borchard, Vice Chair, Farmer, Agricultural Representative Steve Bennett, Supervisor, County of Ventura Charlotte Craven, Councilperson, City of Camarillo Robert Eranio, Director, United Water Conservation District EXECUTIVE OFFICER Jeff Pratt, P.E. Board of Directors Fox Canyon Groundwater Management Agency 800 South Victoria Avenue Ventura, CA SUBJECT: Proposed Ordinance to Establish a New Pumping Allocation System for the Oxnard and Pleasant Valley Basins - (Returning Item) RECOMMENDATIONS: (1) Receive a presentation from Agency staff on a proposed ordinance for a new pumping allocation system for the Oxnard and Pleasant Valley (OPV) Basins; (2) Conduct a public hearing; (3) Conduct first reading in title only of the ordinance; and (4) Set November 20, 2018, as the date for a public hearing to consider adoption of the ordinance. BACKGROUND: Your Board directed that a new pumping allocation system be developed for the OPV Basins consistent with the Sustainable Groundwater Management Act (SGMA), with the expressed preference that proposals for a new allocation system be developed by stakeholders. Stakeholder groups representing agriculture (Ag) and municipal and industrial (M&I) pumpers in the OPV Basins worked on development of a new pumping allocation system for several years. At the June 20, 2018, meeting, your Board directed that the current Emergency Ordinance E allocation system continue through the current year with the goal of transitioning to a new fixed allocation system on January 1, Your Board held a workshop special meeting on development of a new pumping allocation system on July 25, 2018, followed by a regular meeting that afternoon at which your Board provided staff with guidance and direction. At the August 29, 2018, meeting, your Board directed that the new allocation system be based on wellhead allocations for an interim period, transitioning to a land-based system after sufficient information has been collected and administrative and technical infrastructure implemented. At the September 26, 2018, meeting and the October 12, 2018, special meeting, your Board heard public comments and provided additional direction to staff for development of a draft ordinance for a new pumping allocation system. DRAFT ORDINANCE: The attached ordinance (Item 3A) was drafted in accordance with your Board's direction to implement a new pumping allocation system in the OPV Basins consistent with SGMA to implement sustainable groundwater management consistent with the Groundwater Sustainability Plans (GSPs) currently under development. This meeting will be a first reading of the draft ordinance. Your Board may direct staff to modify the draft ordinance based on stakeholder comments and bring the revised ordinance back to your Board for a second reading and consideration of adoption at a November 20, 2018, special meeting, with the intent of a January 1, 2019, effective date. A minimum of 30 days is required after adoption of the ordinance before it goes into effect. Following is a summary of the draft ordinance. 800 South Victoria Avenue, Ventura, CA (805) or FAX: (805) Website: Item 3 - Page 1 of 5

2 Page 2 of 5 General Provisions Extraction allocations will be initially assigned to extraction facilities, with the intent to transition to assignment by parcels in the future. An operator with more than one extraction facility within a basin, may combine the extraction allocations for those extraction facilities within the basin. The Board may subdivide basins into management areas to facilitate sustainable management of the basin and may restrict combining of extraction facilities to within a management area. Allocation Pools Sustainable management of the basins is divided into two pools: Municipal and Industrial (M&I), and Agriculture (Ag). The allocation pools are assigned based on pumping during a 2005 through 2014 base period as 60% Ag and 40% M&I, respectively, of the total groundwater allocation of the basins. The M&I pool will be sub-allocated based on a 2003 through 2012 base period (the current Temporary Extraction Allocation [TEA] period). That is, the percentage of average annual extraction of each M&I well during 2003 through 2012 compared to all other M&I wells establishes the percent allocation of the available M&I pool allocation for that well. Approved variances to the TEA would continue. The Ag pool will be sub-allocated based on a 2005 through 2014 base period. That is, the percentage of average annual extraction of each Ag well during 2005 through 2014 compared to all other Ag wells establishes the percent allocation of the available Ag pool allocation for that well. Total Allocation for Ag Pool The total allocation for the Ag Pool includes the groundwater allocation and projected Santa Clara River (SCR) deliveries to the Pumping Trough Pipeline (PTP) and Pleasant Valley (PV) systems. The SCR delivery projection is updated every 5 years. The initial 5-year projection is based on an assumed value. Subsequent 5-year projections will be based on a running average of actual SCR deliveries. Operators that have access to SCR water via the PTP and PV systems must use this water when available in lieu of groundwater pumping. If actual annual groundwater extractions during the previous 5-year period exceeded the Ag pool groundwater allocations, then the Ag pool groundwater allocations will be reduced for the next 5 years by the amount of excess pumping in the previous 5 years. Initial Allocations The initial Ag pool annual groundwater allocation is 60,000 acre-feet (AF). The first 5-year projected SCR deliveries are 10,000 AF per year. The total Ag pool annual allocation is 70,000 AF. The initial M&I pool annual groundwater allocation is 35,000 AF. Reduction of Allocations The Agency Board will determine the method of allocation reductions once the sustainable yield of the basins has been identified in the GSPs currently under development. Because the Ag and M&I allocation pools of the total initial basin groundwater allocation of 95,000 AF are not 60% Ag and 40% M&I, the M&I pool will not be subject to annual allocation Item 3 - Page 2 of 5

3 Page 3 of 5 Flexibility reductions until such time as the Ag groundwater allocation pool has been reduced to 60% of the total basin groundwater allocation. An operator may carry over up to 50% of its unused annual allocation in any one year up to a maximum of 100% of its current annual allocation at any time. Carried-over allocation expires after 5 years. An operator may apply to borrow up to 5% of its annual allocation from the following-year's allocation in lieu of paying surcharges. Both the operator and owner must make a formal application. The operator (and owner) are liable for surcharges on extractions above the reduced allocation for both the full amount of allocation borrowed and any excess extractions above the following year reduced allocation. Reporting In addition to the existing requirement to report metered extractions for each well, operators are required to report all parcels served by the well. Operators of Ag wells are additionally required to report the irrigated acres of each parcel, and the source of all water irrigating the parcel. Mutual water companies, water districts, or other water purveyors providing groundwater and/or SCR water for agricultural irrigation are required to provide: the turnout identification, meter number, parcel(s) served by the meter, meter location (GIS location and datum), customer name, monthly water deliveries and meter reading, and sources by volume of all water delivered. Mutual water companies, water districts, or other purveyors providing groundwater and/or SCR water for domestic purposes are required to provide: parcel(s) served by the meter, meter location (GIS location and datum), customer name, monthly water deliveries and meter reading, and sources by volume of all water delivered. Municipalities, water districts, or other purveyors providing water for M&I purposes are required to report the list of parcels served or provide a GIS shape file inclusive of all properties served. Variances The draft ordinance contains a procedure for owners or operators. seeking a variance to an initial allocation. OTHER ISSUES: Following are issues raised by stakeholders for your Board's consideration and direction to staff as to how these should, or should not, be addressed in the ordinance. Conejo Creek Water Pumping Program Some stakeholders, including PVCWD, have argued that water from the Conejo Creek Water Pumping Program (also known as the Conejo Creek Project) should be included in the Ag total water allocation under the new allocation system. As discussed under another item on today's agenda, recycled effluent from the City of Thousand Oak's Hill Canyon wastewater treatment plant discharged to a tributary of Conejo Creek is diverted to PVCWD in lieu of pumping groundwater from its extraction wells. PVCWD's wells are in an area of depressed groundwater levels. The majority are in the Pleasant Valley Basin with several in the Oxnard Basin near the boundary with the Pleasant Valley Basin. Calleguas Municipal Water District (Calleguas) was the original operator of the Conejo Creek diversion. In 2003, the FCGMA approved a program whereby for every acre-foot of Conejo Creek Project water delivered to PVCWD, a "storage credit" Item 3 - Page 3 of 5

4 Page 4 of 5 was received. In 2014, the program was transferred from Calleguas to Camrosa Water District (Camrosa). The Agency Board adopted a new resolution ( ) setting the conditions for which credits cou ld be accrued. Prior to the change of operators and the new program requirements established in 2014, the credits generally were used away from the area of the pumping depression, with the majority or all of the credits transferred to UWCD for pumping in the Forebay area of the Oxnard Basin. Reporting to the Agency under the program was not rigorous. The amount of water diverted, and credits generated were reported by a consultant to Calleguas and UWCD, but no metered data or other means of reconciliation were required or provided. Still, data suggest that that pumping by PVCWD decreased during this time. A complicating factor is that UWCD also delivered greater quantities of SCR water to PVCWD during this time via its PV pipeline system. When the program operator changed to Camrosa in 20 14, significantly more rigorous reporting requirements were established by the Agency. While the requirements for reporting of Conejo Creek Project water diverted and delivered to PVCWD were tightened, Emergency Ordinance E was enacted the same year with the requirement for PVCWD to apply for an Annual Efficiency Allocation using the irrigation allowance index (IAI) method, which precludes the ability to reconcile that PVCWD reduced its pumping on a per-acre-foot basis for each acre-foot of project water received. It should also be noted that the Agency has not received a complete allocation application from PVCWD detailing the sources of all applied water and land irrigated for the last few years. There are two issues with the Conejo Creek Project water that need to be resolved in terms of allocation. First, how should it be accounted in PVCWD's sub-allocation during the 2005 through 2014 base period? During that period, Calleguas reported average annual deliveries to PVCWD of 5,478 AF. However, reporting under the program was too limited to establish a one-to-one relationship between these deliveries and a reduction in pumping. PVCWD contends that it would have pumped groundwater had it not had this water available, and its pumping allocation will be significantly diminished if this water is not considered. The second issue is how to address the Conejo Creek Project water under the new allocation system. Under the current program, Camrosa can deliver up to 4,500 AF of project water to PVCWD annually, vvith PVCWD required to purchase a minimum of 3,000 AF. Camrosa plans to pump the equivalent amount of groundwater via the credits received at its wells in the northern portion of the Pleasant Valley Basin, so there will be no net reduction of groundwater pumping in the basin. However, the pumping will be shifted to an area of the basin away from the pumping depression. Staff recommends that the issue of sub-allocation based on historical project deliveries be handled through the variance process for this situation that is unique to PVCWD, but it may need to be accounted for in the Ag total allocation for the base period. Staff also recommends that moving forward under the new allocation system, the Conejo Creek Project water not be included in the total Ag pool allocation like the SCR water. There are two reasons for this recommendation. First, the Agency has a long-standing policy of recognizing the SCR water delivered via the pipeline systems as water which would have been placed in UCWD's recharge facilities and therefore would have accrued to the groundwater basin had it not been diverted. Second, as authorized by Agency Resolution , the program results in a relocation of pumping, but not a net reduction in groundwater pumping. It is a net-zero program. Staff recommends the program continue under the current resolution. Ag to M&I Allocation Transfers Ag land including wells used for Ag irrigation have been, and may be in the future, converted to M&I use through municipal annexation or other means. The existing Agency Ordinance Code specifies how allocation is transferred from land changing from Ag to M&I use. If there is historical allocation, it is transferred at 2 AF per acre. Any historical allocation in excess of 2 AF per acre for the land transitioning to Item 3 - Page 4 of 5

5 Page 5 of 5 M&I is eliminated. If there is no historical allocation, then a baseline allocation of 1 AF per acre is established for the land changing from Ag to M&I use. Some allocation transfers have been established at other amounts based on special circumstances through the variance process. Transfers were placed on hold by Emergency Ordinance E. M&I stakeholder representatives feel strongly that under the new allocation system transfers should be handled on a one-to-one basis. Staff understands their position to be that because all allocations will be fixed moving forward, and those allocations will be reduced over 20 years to achieve sustainable yield, there would be no net impact to the basin with a transfer on an AF per acre to AF per acre basis. Staff notes that this could be less than the existing 1 or 2 AF per acre basis. Staff requests your Board's direction as to how allocation should be transferred from land changing use from Ag to M&I under the new allocation system. RECOMMENDATIONS: Staff recommends your Board conduct a public hearing; conduct a first reading in title only; and set November 20, 2018, as the date for a public hearing to consider adoption of the ordinance. This letter has been reviewed by Agency Counsel. If you have any questions, please call me at (805) Attachment: Item 3A - An Ordinance to Establish an Allocation System for the Oxnard and Pleasant Valley Basins Item 3 - Page 5 of 5 F:\gma\Board\Agendas and Minutes\2018\ \ltem 3- OPV Pumping Allocation Ordinance.docx