NOTICE OF REGULAR MEETING OF BOARD OF DIRECTORS

Transcription

1 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY LIVERMORE, CA PHONE (925) FAX (925) NOTICE OF REGULAR MEETING OF BOARD OF DIRECTORS DATE: Wednesday, April 19, 2017 TIME: 6:30 p.m. CLOSED SESSION 7:00 p.m. OPEN SESSION (time approximate) LOCATION: Zone 7 Administration Building 100 North Canyons Parkway, Livermore, California Director Figuers will be participating remotely via speakerphone from 11 Morin Street, Dover, NH Any member of the public desiring to address the Board on an item under discussion may do so upon receiving recognition from the President. After receiving recognition, please step to the podium and state your name and address. In compliance with the Americans with Disabilities Act, the meeting room is wheelchair accessible and disabled parking is available at the Zone 7 Administrative Building lot. If you are a person with a disability and you need disability-related modifications or accommodations to participate in this meeting, please contact the Zone 7 Board Secretary, Linda Van Buskirk, at (925) or fax (925) Notification 48 hours prior to the meeting will enable Zone 7 to make reasonable arrangements to ensure accessibility to this meeting. {28 CFR , 104 ADA Title II} 1. Call Meeting to Order AGENDA 2. CLOSED SESSION OPEN SESSION TO FOLLOW AT APPROXIMATELY 7:00 p.m. (a) Conference with Labor Negotiators pursuant to Government Code section : Agency Negotiator: G. F. Duerig Employee Organizations: Alameda County Management Employees Association; Alameda County Building and Construction Trades Council, Local 342, AFL-CIO; International Federation of Professional and Technical Engineers, Local 21, AFL-CIO; Local 1021 of the Service Employees International Union, CTW; Unrepresented Management (b) Conference with Legal Counsel - Significant exposure to litigation pursuant to Gov't Code section (d) (2): 3 cases (c) Conference with Legal Counsel - Potential litigation pursuant to Gov't Code section (d) (4): 2 cases (d) Conference with Real Property Negotiator Property: APN Agency Negotiator: G.F. Duerig Negotiating Party: Dwain Berry, Round Rock Properties, LLC Under negotiation: Price and terms of payment 3. Open Session and Report Out of Closed Session (approximate time: 7:00 p.m.) 4. Pledge of Allegiance 5. Citizens Forum This is an opportunity for members of the public to speak on an item not listed on the agenda. The Board cannot deliberate or take action on a non-agenda item unless it is an emergency as

2 defined under Government Code Section Minutes of the Special Board Meeting of February 17, 2017 and Regular Board Meeting of March 15, Consent Calendar a. Memorandum of Understanding to Delegate Groundwater Sustainability Agency Authority to Byron-Bethany Irrigation District b. Amendment to Water Supply Contract with DWR to Incorporate Increased Flow Capacity due to South Bay Aqueduct Enlargement c Annual Review of Sustainable Water Supply for Zone 7 Water Agency d. EPA Water Quality Improvement Fund Grant Application Authorization e. Board Resolutions for the Drinking Water State Revolving Fund Recommended Action: Adopt resolutions approving items as presented 8. Staffing Update a. Employee of the Month Recognition b. Congratulations to Retiree Caroline Abram c. Congratulations to Retiree Larry Akinsiku d. Congratulations to Retiree Keith Braaten e. Congratulations to Retiree Gerald DeWitt f. Congratulations to Retiree Diana Gaines g. Congratulations to Retiree Wyman Hong h. Congratulations to Retiree Kevin Hulme 9. Lake Del Valle Storage Expansion Study Recommended Action: Discuss and consider adopting resolution 10. Award of Contract to Morrison & Associates, Inc., for Professional Services for Outreach Support, including the Schools Program Recommended Action: Adopt resolution 11. First Reading of Proposed Sustainable Groundwater Management Ordinance Recommended Action: Discuss and Provide Direction After reading the title, take a vote to waive the full reading of the Ordinance, discuss as appropriate and direct staff to schedule the consideration of Ordinance adoption at the May 17, 2017, Board meeting. 12. Proposed Authority to Withdraw Money from the County Treasury Recommended Action: Adopt resolution 13. Authorization for Banking/Depository Services, Custodial Services, Investment Management Services and Designating Financial Signature Recommended Action: Adopt resolution 14. Investment Policy Recommended Action: Adopt resolution Materials related to an item on this agenda that have been provided to the Board less than 72 hours prior to the meeting are available for public inspection at the Zone 7 office at the time of, and prior to, the meeting and at All other material otherwise provided to the Board will be available at the public meeting.

3 15. Consider Action to Increase the Compensation of Zone 7 Board Members Recommended Action: Discuss and Provide Direction 16. Committees: a. Water Resources Committee Meeting, April 11, 2017 notes 17. Reports - Directors a. Verbal comments by President b. Verbal reports 18. Items for Future Agenda - Directors 19. Staff Reports (Information items. No action will be taken.) a. General Manager s Report b. Legislative Update c. Outreach Activities d. Water Inventory and Demand Update (March) e. Updates on Water Supply Projects f. Update on Zone 7 Vehicle Fleet g. Verbal reports 20. Adjournment 21. Upcoming Board Schedule: (All meeting locations are in the Boardroom at 100 North Canyons Parkway, Livermore, unless otherwise noted.) a) Tri-Valley Water Liaison Committee Meeting: April 26, 2017, 4:00 p.m. at DSRSD, 7051 Dublin Boulevard, Dublin, CA b) Special Board Meeting (if needed): May 3, 2017 c) Regular Board Meeting: May 17, 2017, 7:00 p.m. Materials related to an item on this agenda that have been provided to the Board less than 72 hours prior to the meeting are available for public inspection at the Zone 7 office at the time of, and prior to, the meeting and at All other material otherwise provided to the Board will be available at the public meeting.

4

5

6

7

8 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY LIVERMORE, CA PHONE (925) FAX (925) MINUTES OF THE BOARD OF DIRECTORS ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT The following were present: REGULAR MEETING March 15, 2017 DIRECTORS: SANDS FIGUERS JOHN GRECI ANGELA RAMIREZ HOLMES JIM McGRAIL SARAH PALMER RICHARD QUIGLEY BILL STEVENS DIRECTORS ABSENT: NONE ZONE 7 STAFF: COUNSEL: JILL DUERIG, GENERAL MANAGER KURT ARENDS, ASSISTANT GENERAL MANAGER, ENGINEERING OSBORN SOLITEI, ASSISTANT GENERAL MANAGER, FINANCE/TREASURER CAROL MAHONEY, MANAGER, INTEGRATED WATER RESOURCES JOE SETO, PRINCIPAL ENGINEER, FLOOD PROTECTION LINDA VAN BUSKIRK, BOARD SECRETARY DAVID ALADJEM, DOWNEY BRAND Item 1 - Call Meeting to Order President Quigley called the meeting to order at 5:00 p.m. and the board went into Closed Session immediately. Item 2 - Closed Session (a) Conference with Labor Negotiators pursuant to Government Code section : Agency Negotiator: G. F. Duerig Employee Organizations: Alameda County Management Employees Association; Alameda County Building and Construction Trades Council, Local 342, AFL-CIO; International Federation of Professional and Technical Engineers, Local 21, AFL-CIO; Local 1021 of the Service Employees International Union, CTW; Unrepresented Management Assistant General Manager, Finance (b) Conference with Legal Counsel - Significant exposure to litigation pursuant to Gov't Code section (d) (2): 3 cases 1 P a g e

9 March 15, 2017 (c) Conference with Legal Counsel - Potential litigation pursuant to Gov't Code section (d) (4): 2 cases (d) Conference with Real Property Negotiator. Property: APN 099A Agency Negotiator: G.F. Duerig Negotiating Party: Sandra Weck, Colliers International Under negotiation: Price and terms of payment (e) Conference with Real Property Negotiator Property: APN Agency Negotiator: G.F. Duerig Negotiating Party: Dwain Berry, Round Rock Properties, LLC Under negotiation: Price and terms of payment Item 3 - Open Session and Report Out of Closed Session The Board came out of Closed Session at 6:55 p.m. At 7:01 p.m., President Quigley called the meeting back into session and asked David Aladjem, Counsel, to report out of Closed Session. Mr. Aladjem stated that the Board met with labor negotiators, legal counsel and real property negotiators in Closed Session. For Items 2(b), (c), (d) and (e), no reportable action was taken. Under Item 2(a) negotiations with labor negotiators, unrepresented management, Assistant General Manager of Finance, there is a proposed resolution for discussion in Open Session by the Board of Directors. President Quigley set the discussion on Item 2(a) for the end of the meeting. Item 4 - Pledge of Allegiance President Quigley led the Salute to the Flag. Item 5 - Citizens Forum: No comments were received. Item 6 - Minutes of the Regular Meeting of February 15, 2017 Director Palmer moved that the minutes of February 15, 2017 be accepted and approved and Director Stevens seconded the motion. The minutes were approved by a voice vote of 7-0. Item 7 - Consent Calendar a. Declaration of March 20-26, 2017 as Fix a Leak Week and Declaration of May 2017 as Water Awareness Month Director Ramirez Holmes moved to approve Item 7(a) and Director Figuers seconded the motion. The item was passed by a voice vote of 7-0. Resolution No Declared March 20-26, 2017 as Fix a Leak Week and May as Water Awareness Month 2 P a g e

10 March 15, 2017 Item 8 - Staffing Update a. New Employee Introduction Justin West General Manager, Jill Duerig, announced that Justin West joined Zone 7 as a Water Plant Operator III in the Operations Section. He comes to us with over three years of operations experience, most recently at the City of Fairfield. Justin holds an Associate s degree in Water and Wastewater Technology from Solano Community College in partnership with the Bay Area Consortium for Water and Wastewater Education (BACWWE) program. He holds both Grade 3 Water Treatment and Grade 2 Water Distribution certifications from the State of California. The Board welcomed and applauded Justin West in absentia. b. Employee of the Month Jesus Bautista Ms. Duerig announced that Jesus Bautista, Construction Maintenance Laborer reporting to Barry Ivy, was nominated as Employee of the Month. Jesus was recently recommended through an external nomination from the Tri-Valley Conservancy due to his professionalism and courtesy. He is a true gentleman who maintains a positive attitude and willingness to devote extra effort at work. The board applauded Jesus Bautista in absentia. Item 9 Declaration of Local State of Flood Emergency and Authorization of Amendment to Fanfa Contract to do Emergency Repairs Joe Seto, Principal Engineer, Flood Protection, gave a brief presentation which highlighted the significant storms that occurred in the Tri-Valley during January and February 2017 and the resulting damage to Zone 7 s facilities. To date, Zone 7 identified over 150 sites where damage has occurred to Zone 7 s flood facilities as a result of these storms. Repair and construction estimates are greater than $10,000,000. In response to questions from Director Ramirez Holmes regarding emergency projects and the permitting process, Staff responded that one of the advantages of the emergency process that staff is recommending this evening for the most critical projects is that the Agency can streamline the procurement/contracting process, which can often take several months. Staff is recommending this for these critical projects since it is important to move forward quickly to minimize further damage. The permitting process remains the same. There is no relaxing, streamlining or fast tracking of permitting for these projects despite the fact that it is an emergency. President Quigley asked if there were any comments from the public. There were none. A motion was made by Director Palmer to declare a locate state of flood emergency, and it was seconded by Director Figuers. The motion was passed by a roll call vote of 7-0. Resolution No Declared a local state of flood emergency A second motion was made by Director Palmer to approve a contract amendment with Fanfa, and it was seconded by Director Figuers. The motion was passed by a roll call vote of P a g e

11 March 15, 2017 Resolution No Authorized amending the contract with Fanfa, Inc., for emergency work for Zone 7 s flood facilities Item 10 Private Landowner Request for Assistance on Arroyo De La Laguna Ms. Duerig introduced Carol Mahoney, Manager of Integrated Water Resources, who provided a brief overview and history of the Arroyo de la Laguna Verona Reach. She described the general approach in the Stream Management Master Plan for the reach, a nearby demonstration project and the need for funding partners such as NRCS. She then provided and a storm damage response timeline from January through March Ms. Mahoney then introduced Paul Frank, P.E., the Design Team Lead with Flow West, who discussed site conditions, progress to date, a possible path forward to design and proposed actions regarding the emergency permit application to the U.S. Army Corps of Engineers with proposed timelines. The Board expressed its empathy toward the homeowners and commented that it would help. A discussion ensued regarding the suggested options outlined in the revised resolutions. Staff added that there may be other opportunities that have not yet been identified that could be revealed through further discussion or that more than one resolution could be adopted, such as local sponsorship plus establishing a local emergency grant program for Verona Reach. In response to questions about what exactly local sponsorship means and the approximate timeline for receipt of federal funds, Staff responded that it is a program through the federal government where the Natural Resources Conservation Service (NRCS) provides assistance in protecting private property up to 75% of the value of the structure that is being threatened. A local sponsor is required to assure that the project is managed. It might take up to a year to get the funds which then go directly into reimbursing Zone 7 for contracts for design and construction. The agency would front the money and then be reimbursed for a portion of it. Actual construction cannot start until a permit is in place. The timeline for an emergency permit is likely one to two weeks. President Quigley asked if there were any comments from the public. Public Comments: President Quigley read a letter left by Tim Sbranti, Deputy Chief of Staff/District Director from Congressman Eric Swalwell s office into the record: On behalf of Congressman Eric Swalwell, I wanted to let the Board know that our office has been working closely with Zone 7, the City of Pleasanton and the Army Corps of Engineers to ensure that the necessary repairs are made to the arroyo to prevent the potential catastrophic loss of life and property. We are hopeful that the Board will direct staff to move forward tonight and complete the work. The Congressman and our office will remain committed to assisting as needed to help expedite the permits and secure some emergency funding. Once the short term emergency repairs are completed, we look forward to working with Zone 7, the City of Pleasanton, the relevant state and federal agencies, and the property owners to assist with the long-term fixes that are needed for the arroyo s sustainability. 4 P a g e

12 March 15, 2017 Julia Shin, Pleasanton, said she and her husband purchased the property on Foothill Road in She discussed development in the area. She expressed concern for her neighbor s house which is in critical condition. She urged the Board to provide immediate corrective action and longer term solutions by providing local sponsorship. Ann Chen, Pleasanton, spoke regarding the erosion problem and said the new developments, as Julia Shin previously mentioned, contributed to the increased water flow into the flood control channel and through the Arroyo de la Laguna. She said that Zone 7 holds an easement along the arroyo and across nine lots to construct, maintain, operate, inspect, and repair flood control facilities and appurtenances, and therefore she and the other eight homeowners believe maintenance of the Arroyo de la Laguna is the responsibility of Zone 7. Ted Smith, Pleasanton, stated he was the first of the nine homeowners who built in the area in question. He said the staff report is inaccurate as it addresses the erosion problem as a result of the recent storms. He said this has been going on for three to five years. He urged the Board to become the local sponsor and to get the necessary permits expedited. Eddie Belshe, Pleasanton, thanked the Board members who visited the site. He expressed concern that the S-curve has been created over the last 17 years due to continued development which funnels water through the ADLL and has led to the erosion. He does not believe this is an Act of God. He encouraged the Board to step up and do the right thing by sponsoring the project and making the necessary repairs. Yoshiko Sato, Pleasanton, brought a map to reference as she discussed easements. They had purchased Lot 9 in 2011 next door to her parents on Lot 8. She said their lot is the only one with access to the creek. At that time they had contacted Zone 7 to find out the purpose of the easement and they were told by Dennis Gambs, the Real Property Services Manager at Zone 7, that Zone 7 has the responsibility to maintain the Arroyo de la Laguna located behind the lot and the neighboring nine-home development. She said that just last summer they were told be ready to see some big equipment coming in because there was going to be work done in the creek and that they felt very safe knowing that Zone 7 was maintaining the creek. Ginger Belshe, Pleasanton, thanked the Board members for listening and for visiting the site. She also thanked Zone 7 Staff, saying that this gave her hope. She stated that the staff report on page 3 mentioned discussions with the property owners, but that did not happen. She expressed concern over the safety of the ACE train. David Raun, Pleasanton, addressed the Board and urged Zone 7 to do the right thing and help the homeowners. Janice Smith, Pleasanton, stated she was one of the first buyers in the area. She spoke about the easements Zone 7 has on the properties for the purpose of maintaining and repairing the arroyo. She thanked Zone 7 for what it has done so far, and further urged the Board to do the right thing and become the local sponsor to help save homes and solve this problem. Lori Raun, Pleasanton, spoke regarding the changes they have witnessed in the creek over the 20 years they have lived there and shared photos with the Board to show the changes. She stated that they were never approached by Zone 7 about a proposal, project or plan regarding erosion 5 P a g e

13 March 15, 2017 issues. She thanked the Board members who visited the homes today and urged others to see the level of disaster that has occurred, which she believes could have been prevented if Zone 7 regularly monitored, maintained and managed the arroyo. She urged the Board to help the homeowners by becoming their local sponsor. Sanjeev Taran, Pleasanton, spoke regarding the funds available to Zone 7 to support the fix which the homeowners are asking for. He shared a copy of Total Revenues from the Zone 7 website with the Board. He urged the Board to be the local sponsor and help remedy the situation. Bill Siamas, a Pleasanton resident of 30 years, spoke in support of his friends, the Rauns, and their neighbors. He urged the Board to adopt an emergency measure to repair the affected areas, particularly the areas by the Rauns and the Belshes and to maintain the easement in order to protect these homes. John Vest, General Manager at Castlewood County Club, spoke in support of his neighbors on the other side of the arroyo. He stated he has seen the S-curve move quite a bit over time. He encouraged the Board to direct staff to come up with a solution that will address the entire Verona Reach. Scott Alcaide, Pleasanton, spoke in support of funding a fix for the Verona Reach because it is important and is the right thing to do. Tom Coleman, Pleasanton, encouraged the Board to do the right thing. He spoke in support of a permanent fix that will affect the entire Verona Reach. Tim Hunt, a Pleasanton resident on Foothill Road since 1958, spoke about engagement with Zone 7 back in when similar changes to yards were happening. He complimented Carol Mahoney for the history she presented. Due to the current crisis, he expressed full support of emergency measures and urged the Board to act on those, become the local sponsor, and do the right thing for the whole reach. Steve Kirkpatrick, representing the City of Pleasanton, City Manager s office, thanked Ms. Duerig and Ms. Mahoney for educating everyone on the work that has been going on. On behalf of Mr. Fialho, who could not be present at the meeting, Mr. Kirkpatrick read into the record Mr. Fialho s March 15, 2017 letter to the President and Members of the Board of Zone 7 which has been added to the posted staff report on the website. Richard Price, Pleasanton, husband of Yoshiko Sato who spoke earlier, addressed the Board regarding conversations over the past four years with Zone 7 as people came through their easement to access the arroyo that consistently expressed that Zone 7 would maintain the creek. He urged the Board to become the local sponsor. Director Greci expressed empathy towards the homeowners for their loss and encouraged his fellow board members to support being a local sponsor. He commended staff for the preliminary work being done. 6 P a g e

14 March 15, 2017 Director McGrail concurred with Director Greci. He urged the residents to engage the City of Pleasanton who issued those building permits and approved the engineering on those lots. He further encouraged a collaborative effort in order to get help from other people/agencies who he stated should have been paying attention. Director Figuers moved to approve Resolutions 2 and 3(b). Director Palmer stated this is a regional issue and encouraged cooperation with the City of Pleasanton. Director Ramirez Holmes thanked the homeowners for coming to the meeting and sharing their personal stories about what their dreams were for ownership of the homes and their future. She expressed her support for becoming a local sponsor and authorizing the work to be done. She further stated that she would like to see Staff work on partners to figure out the 25% portion. She expressed appreciation to the City of Pleasanton for its willingness to work on interagency issues. She would like to see continued discussions regarding solving long-term issues about development and how we handle storm water runoff and how to solve the issues of the reach. Additionally, she would like to see a commitment to a regular outreach with folks in order to provide regular updates as thing progress through the timeline. In response to Director Stevens question about the flow of water released from Lake Del Valle, Staff responded that the lake is operated by the Department of Water Resources under a U.S. Army Corps of Engineers permit. Zone 7 is in contact with the DWR and usually knows in advance when they will be releasing water. Although Zone 7 can make requests related to flows, it is ultimately up to DWR to decide if and when releases will occur. President Quigley added his support for being a local sponsor. He expressed delight at receiving Nelson Fialho s letter from the City of Pleasanton offering collaborative support, as well as that from Tim Sbranti from Eric Swalwell s office. He thanked the public for coming to the meeting. Director Figuers moved to approve Item 10 (example #2) and Director Ramirez Holmes seconded the motion. The item was passed by a roll call vote of 7-0. Resolution No Authorized Local Sponsorship of Emergency Watershed Protection Program (Item 10, revised resolution #2) Director Palmer moved to approve Item 10 (example 3a) and Director Ramirez Holmes seconded the motion. The item was passed by a roll call vote of 7-0. Resolution No Authorized a Design Services Contract with FlowWest for Emergency Work (Item 10, revised resolution #3a) Director Ramirez Holmes moved to approve Item 10 (example 3b) and Director Palmer seconded the motion. The item was passed by a roll call vote of 7-0. Resolution No Authorized an Amendment to the Contract with Fanfa, Inc., or Equivalent, for Emergency Construction Work (Item 10, revised resolution #3b) 7 P a g e

15 March 15, 2017 Director Ramirez Holmes proposed an additional motion to direct staff to work on partners and collaboration process with the City of Pleasanton, Congressman Swalwell s office and others as well as outreach for the affected neighbors and to keep discussing through regular communication the long-term solutions for the Arroyo de la Laguna and the Verona Reach and the SMMP projects. The motion was seconded by Director Palmer. The motion passed by a voice vote of 7-0. [The Board took a short break at 9:16 p.m. President Quigley called the meeting back to order at 9:22 p.m.] Item 11 Authorization for LARPD to Manage Weed Control Spraying Services Joe Seto, Principal Engineer, Flood Protection, gave a brief verbal presentation on the topic. In April 2014 the Board approved and authorized the General Manager to execute a one-year contract with the Livermore Area Recreation and Park District (LARPD), which allowed for two additional one-year extensions in FY 2015/16 and FY 2016/17. Mr. Seto highlighted Staff s recommendation for the continued use of LARPD under the Intergovernmental Reciprocal Services Master Agreement (IRSMA) because of the following reasons: Both agencies can use common resources effectively; It reduces costs; It increases efficiency; LARPD has adequately trained and certified crew and equipment; In the past three years, LARPD has demonstrated a good understanding of Zone 7 s needs and regulatory requirements; LARPD has an established safety program and procedures; LARPD has an Integrated Pest Management (IPM) program that they have implemented which has reduced the amount of chemicals used near the creek facilities. Due to the high level of demands on Staff resources during the current flood emergencies, Staff recommended a one-year extension before rebidding this project by executing a Task Order with LARPD for the weed control spraying contract for FY Mr. Seto pointed out that Mr. Bruce Aizawa from LARPD was in the audience. He is an IPM expert. Director McGrail moved to approve Item 11 and Director Ramirez Holmes seconded the motion. The item was passed by a roll call vote of 7-0. Resolution No Authorized Task Order with LARPD for weed control spraying services Item 12 Contract Amendment for Emergency Repair of the Hopyard Pipeline Kurt Arends, Assistant General Manager, Engineering, presented the staff report. Director Palmer moved to approve Item 12 and Director McGrail seconded the motion. The item was passed by a roll call vote of 7-0. Resolution No Authorized a contract amendment with Monterey Mechanical for the 8 P a g e

16 March 15, 2017 emergency repair of the Hopyard Pipeline Item 3 - Open Session and Report Out of Closed Session (continued) President Quigley reopened Item 3 to discuss and act on the proposed resolution from Item 2(a), a footnote for the Zone 7 treasurer. Director McGrail moved to approve Item 2(a) and Director Palmer seconded the motion. Director Ramirez Holmes proposed an amendment to the motion to change the effective date from September 21, 2016 to January 1, 2017 and Director Palmer seconded the motion. The amended item was passed by a roll call vote of 7-0. Resolution No Approved Appendix A, Footnotes to Salary Schedules Section 4.14 Treasurer, effective for the period starting January 1, Item 13 Committees - none Item 14 - Reports - Directors a. Verbal comments by President b. Written Report by President Quigley c. Verbal reports President Quigley complimented Zone 7 staff for participating in the Alameda County Science and Engineering Fair on Saturday, March 11 th. Director Palmer attended the Los Vaqueros Reservoir Expansion Project Presentation and Tour on February 17 th. She also attended the ACWA Conference in Washington, D.C. February 28 th March 2 nd. She reported it was good to hear about the bipartisan Water Infrastructure Improvements for the Nation (WIIN) Act. She said it was heartening and worthwhile to hear differing points of view. Director Ramirez Holmes also attended the Los Vaqueros Reservoir Expansion Project Presentation and Tour. She encouraged other board members to visit if they were unable to make it to the February 17 th Special Board Meeting. She further reported that she attended the Pleasanton State of the City Address on February 22 nd where the ongoing commitment to water conservation and the recycling project that is underway in Pleasanton was discussed. Director McGrail reported that he also attended the Los Vaqueros Reservoir Expansion Project Presentation and Tour. He complimented those who put the project tour together and encouraged Staff to work in collaboration with Contra Costa Water District as this effort moves forward. Item 15 - Items for Future Agenda - Directors No future items were discussed. 9 P a g e

17 March 15, 2017 Item 16 - Staff Reports (Information items. No action will be taken.) a. General Manager s Report b. Legislative Update c. Outreach Activities d. Water Inventory and Demand Update e. Update Related to the Cal WaterFix (former Bay Delta Conservation Plan) f. Verbal reports Ms. Duerig briefly discussed two items. The first was that the ACWA Board had just adopted a new ACWA Policy Statement on Bay-Delta Flow Requirements. Ms. Duerig then reported that five to six employees plan to retire by the end of March. Additionally, Kurt Arends, Assistant General Manager, Engineering resigned his position to return to Santa Clara Valley Water District. Mr. Arends said it has been a pleasure serving the Board and working with Staff and thanked the Board for those opportunities. The Board congratulated Mr. Arends. Ms. Duerig stated that the Flood Control section, normally a six-person staff, has been very limited at this time due to two retirements and one employee on a military leave of absence. She commended Mr. Seto for his miraculous accomplishments in the last few weeks under these circumstances. Item 17 - Adjournment The meeting was adjourned at 9:38 p.m. 10 P a g e

18 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: INTEGRATED WATER RESOURCES CONTACT: Matt Katen/Carol Mahoney AGENDA DATE: April 19, 2017 ITEM NO. 7a SUBJECT: Memorandum of Understanding to Delegate Authority Provided by the Sustainable Groundwater Management Act SUMMARY: The Sustainable Groundwater Management Act of 2014 (SGMA) requires the formation of Local Groundwater Sustainability Agencies (GSAs) by June 30, Portions of the San Joaquin Valley Tracy Basin (Tracy Basin) (DWR s Groundwater Basin ), a medium priority basin, lie within the boundaries of Alameda County, San Joaquin County and Contra Costa County. The Sustainable Groundwater Management Act identified Zone 7 as the exclusive local agency to be the GSA for all groundwater basins within its service area which includes the small portion of the Tracy Basin within Alameda County. Formerly, the San Luis & Delta Mendota Water Authority (SLDMWA) declared an intention to be the GSA for that portion of the Tracy Basin within San Joaquin County which represents the majority of the Tracy Basin. As a result, the Board authorized a Memorandum of Understanding (MOU) with SLDMWA in September 2015 for SLDMWA to delegate authority to be the GSA for the portion of the Tracy Basin within Alameda County and the MOU was executed in September SLDMWA terminated the MOU on March 30, Byron Bethany Irrigation District, a member agency of SLDMWA, has now declared an intention to take on the role of GSA for this same area so a new MOU has been developed for Zone 7 to delegate to BBID the authority provided by the Sustainable Groundwater Management Act to act as the GSA for the portion of the Tracy Basin contained within Alameda County and to allow Zone 7 to continue issuing well permits, monitoring groundwater levels and submitting data to CASGEM. This matter was discussed with the Water Resources Committee on April 11, 2017, and the committee supported an MOU with BBID. FUNDING: None RECOMMENDED ACTION: Adopt attached resolution. ATTACHMENTS: Interoffice Memorandum Resolution Draft MOU

19 DATE: April 19, 2017 TO: FROM: SUBJECT: INTEROFFICE MEMORANDUM Jill Duerig, General Manager Carol Mahoney, Integrated Planning Manager Memorandum of Understanding to Delegate Authority Provided by the Sustainable Groundwater Management Act On September 16, 2014 California Governor Brown signed a three-bill package known as the Sustainable Groundwater Management Act (SGMA). The legislation allows local agencies to customize groundwater sustainability plans to their regional economic and environmental needs. SGMA creates a framework for sustainable local groundwater management. SGMA provides for sustainable management of groundwater basins by enhancing local management of groundwater consistent with rights to use or store groundwater. The Act establishes minimum standards for effective, continuous management of groundwater basins and provides local groundwater agencies with the authority, as well as the technical and financial assistance needed to maintain groundwater supplies and avoid or minimize the impacts of land subsidence. SGMA empowers local agencies to manage groundwater basins, while minimizing state intervention, and allows local agencies to establish a new governance structure, known as a Groundwater Sustainability Agency (GSA), as needed prior to developing groundwater sustainability plans for groundwater basins or sub-basins that are designated as medium or high priority. The text of the Act identifies fifteen specific groundwater management agencies within the state, including Zone 7, as the exclusive local agencies within their respective statutory boundaries with powers to comply with the Act. DISCUSSION: The boundaries of Zone 7 s service area include either all or a portion of three groundwater basins: the Main Livermore Basin, a medium priority basin which Zone 7 has been managing since the 1960 s; the Sunol Valley Basin, a low priority basin which does not currently require a groundwater sustainability plan; and the San Joaquin Valley - Tracy Basin, a medium priority basin which underlies portions of Alameda, Contra Costa, and San Joaquin Counties. See Figure 1. Figure 1- Groundwater Basin and County Boundaries With such a small portion of the Tracy Basin in Alameda County, it would be very difficult for Zone 7 to effectively manage the basin. The largest portion of the Tracy

20 Basin falls within San Joaquin County. Originally, the San Luis & Delta Mendota Water Authority (SLDMWA) planned to become the GSA for the portion of the Tracy Basin within San Joaquin County and planned to be responsible for managing the majority of the basin. To facilitate the effective management of the entire basin, Zone 7 and SLDMWA agreed that the portion of the Tracy basin within Alameda County should be managed with the rest of the basin. While the SLDMWA would have been the GSA for this portion of the Tracy Basin, Zone 7 always planned to retain authority as the well permitting agency for all lands within its service area including that portion overlying the Tracy Basin. In addition, Zone 7 always planned to continue to monitor groundwater levels within that portion of the Tracy Basin and to enter data into the State s California Statewide Groundwater Elevation Monitoring (CASGEM) program data base. All data collected by Zone 7 for the Tracy Basin was to have been shared with SLDMWA and Zone 7 planned to participate in the development of the groundwater sustainability plan for the Tracy Basin. The MOU with SLDMWA captured all these concepts. In August 2015, the Zone 7 Board authorized the MOU with SLDMWA and the MOU was executed in September However, SLDMWA s plans to become the GSA for this area did not develop and on March 30, 2017, SLDMWA sent Zone 7 a letter terminating the MOU. At about the same time, Byron Bethany Irrigation District (BBID), one of the members of SLDMWA, expressed an interest in pursuing GSA authority for this area. With the SLDMWA MOU terminated, a draft MOU with BBID was drafted based on the same general terms and conditions. FUNDING: Approval of the MOU is not expected to have any direct costs or savings for Zone 7 as Zone 7 s groundwater management program will continue to monitor, report and permit wells within its service area. If, at some point in the future, BBID decides to impose GSA fees or assessments, they might ask Zone 7 to collect those on its behalf and there could be a small de minimis administrative cost for processing that request. RECOMMENDED ACTION: Staff recommends that the Board adopt the attached resolution authorizing the General Manager to negotiate and execute a Memorandum of Understanding to delegate to BBID the authority provided by the Sustainable Groundwater Management Act to act as the GSA for the portion of the Tracy Basin contained within Alameda County.

21 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT BOARD OF DIRECTORS RESOLUTION NO. INTRODUCED BY SECONDED BY Memorandum of Understanding to Delegate SGMA Authority to BBID for Tracy Subbasin WHEREAS, the Sustainable Groundwater Management Act of 2014 (SGMA) requires the formation of Local Groundwater Sustainability Agencies (GSAs) by June 30, 2017, and the adoption of Groundwater Sustainability Plans for high- and medium-priority basins within five to seven years; and WHEREAS, portions of the San Joaquin Valley Tracy Basin (Tracy Subbasin) (Groundwater Basin ), a medium priority basin, lie within the boundaries of Alameda County, San Joaquin County and Contra Costa County; and WHEREAS, the Sustainable Groundwater Management Act identified Zone 7 as the exclusive local agency to be the GSA for that portion of Alameda County within its service area which includes the small portion of the Tracy Subbasin within Alameda County; and WHEREAS, Zone 7 and the San Luis & Delta Mendota Water Authority (SLDMWA) executed a Memorandum of Understanding (MOU) in September 2015 in anticipation of SLDMWA assuming the role of GSA for the Tracy Subbasin; and WHEREAS, the Byron Bethany Irrigation District (BBID) is a Member Agency of SLDMWA; and WHEREAS, SLDMWA, itself, no longer intends to assume the role of GSA for the Tracy Subbasin and has therefore terminated the MOU between Zone 7 and SLDMWA; and WHEREAS, BBID now intends to be the GSA for that portion of the Tracy Subbasin within San Joaquin County and Contra Costa County and lying within its boundaries; and WHEREAS, staff have drafted an MOU with BBID that is based on the same terms and conditions as the former MOU with SLDMWA; and WHEREAS, it is mutually beneficial to create this MOU to establish the delegation of authority to allow BBID to be the GSA for the portion of the Tracy Basin within Alameda County to assure sustainable groundwater management without changing any basin boundaries while retaining all Zone 7 s well permitting and monitoring authority within its service area and to collaborate with other GSAs in developing a basinwide Groundwater Sustainability Plan.

22 NOW, THEREFORE, BE IT RESOLVED that the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District hereby authorizes and directs the General Manager to negotiate and execute an MOU with BBID to delegate authority provided under the Sustainable Groundwater Management Act. ADOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, By: President, Board of Directors

23 MEMORANDUM OF UNDERSTANDING BETWEEN ZONE 7 OF THE ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT AND THE BYRON-BETHANY IRRIGATION DISTRICT This memorandum of understanding (MOU) is made and entered between Zone 7 of the Alameda County Flood Control and Water Conservation District (Zone 7), and the Byron- Bethany Irrigation District (BBID) in consideration of the factual recitals and agreements contained herein. WHEREAS, the Sustainable Groundwater Management Act of 2014 (SGMA) requires the formation of Local Groundwater Sustainability Agencies (GSAs) and the adoption of Groundwater Sustainability Plans for high- and medium-priority basins within five to seven years; and WHEREAS, portions of the San Joaquin Valley Hydrologic Region, Tracy Subbasin (Subbasin) (Groundwater Basin ), a medium priority basin, lie within the boundaries of Alameda County, San Joaquin County and Contra Costa County; and WHEREAS, the Sustainable Groundwater Management Act identified Zone 7 as the exclusive local agency to be the GSA for that portion of Alameda County within its service area, including the small portion of the Subbasin within Alameda County; and WHEREAS, Zone 7 and the San Luis & Delta Mendota Water Authority (SLDMWA) executed a Memorandum of Understanding in September 2015 in anticipation of SLDMWA assuming the role of GSA for the Tracy Subbasin; and WHEREAS, BBID is a Member Agency of SLDMWA; and WHEREAS, SLDMWA, itself, no longer intends to assume the role of GSA for the Subbasin and has therefore terminated the MOU; and WHEREAS, BBID now intends to be the GSA for that portion of the Subbasin within San Joaquin County and Contra Costa County within BBID s boundary; and WHEREAS, it is mutually beneficial to create this agreement to establish the delegation of authority to allow BBID to be the GSA for the portion of the Subbasin within Alameda County to assure sustainable groundwater management throughout the Subbasin without changing any basin boundaries. NOW, THEREFORE, the parties to this MOU do hereby agree as follows: 1. Purpose of MOU. The purpose of this MOU is for Zone 7 to delegate to BBID the authority provided by the Sustainable Groundwater Management Act to act as the GSA for the portion of the Subbasin contained within Alameda County.

24 2. Authority and Responsibility. Upon execution of this MOU, and upon recognition of BBID as the GSA within the Subbasin, Zone 7 agrees to delegate to BBID the administrative function, powers and duties assigned by the SGMA to Zone 7 for the area covered by this MOU as designated under Paragraph 3, below (Area), referred to herein as the Delegated Authority. Zone 7 shall continue to be the well permitting agency for all areas within its jurisdiction. Zone 7 agrees to enforce all provisions and requirements contained in the Groundwater Sustainability Plan (GSP) adopted for the Area that are more stringent than those already being enforced by Zone 7, including the collection of fees and fines under the GSP; provided, that with regard to collection of fees and fines, Zone 7 agrees to remit to BBID fees and fines imposed by BBID on lands or landowners and collected by Zone 7 in the Area pursuant to SGMA, any other applicable provision of California law, and any policies, rules or regulations duly adopted by BBID as GSA for the Subbasin. Zone 7 shall continue to monitor groundwater elevations within the Area and enter data into CASGEM as required in order to maintain grant eligibility. 3. Areas Covered by MOU. This MOU shall have effect in that portion of the Subbasin, as defined in DWR Bulletin 118, which lies within the jurisdictional boundaries of Zone Records. BBID shall provide to Zone 7 copies of all documents, reports, studies and other records created pursuant to said authority that will affect or relate to the management of the Area. BBID shall include Zone 7 in the development of all such plans, studies and reports. Zone 7 shall provide BBID with copies of all well permits issued (including well completion reports) and any water level measurements taken within the Area. Zone 7 shall cooperate and coordinate with BBID in responding to requests made under the California Public Records Act regarding records related to groundwater management within the Area. 5. Term. This MOU becomes valid and effective immediately upon execution by both parties hereto and shall remain in effect unless terminated pursuant to Paragraph 8 below. 6. Indemnity. A. To the fullest extent permitted by law, BBID shall hold harmless, defend and indemnify Zone 7, its Board of Directors, employees and agents from and against any and all claims, losses, damages, liabilities and expenses, including but not limited to attorneys fees, arising out of or resulting from the sole negligence or willful misconduct of BBID in its exercise of the Delegated Authority. Zone 7 may participate in the defense of any such claim without relieving BBID of any obligation hereunder. B. To the fullest extent permitted by law, Zone 7 shall hold harmless, defend and indemnify BBID, its Board of Directors, employees and agents from and against any and all claims, losses, damages, liabilities and expenses, including but not limited to attorneys fees, arising out of or resulting from the sole negligence or willful misconduct of Zone 7 in its exercise of all authority it has under SGMA that is not Delegated Authority. BBID may participate in the defense of any such claim without relieving the Zone 7 of any obligation hereunder. 7. Entire Agreement. This MOU shall constitute the entire agreement between BBID and Zone 7 relating to the delegation of authority provided by the SGMA. This MOU supersedes and merges all previous understandings, and all other agreements, written or

25 oral, between the parties and sets forth the entire understanding of the parties regarding the subject matter thereof. 8. Counterparts and Copies. This MOU may be executed in any number of counterparts, each of which may be deemed an original and all of which collectively shall constitute a single instrument. Photocopies, facsimile copies, and PDF copies of this MOU shall have the same force and effect as a wet ink original signature on this MOU. 9. Amendment. This MOU may be amended at any time by written agreement of both parties. 10. Termination. This MOU may be terminated by either party at any time. Termination shall not become effective until after the party not initiating the termination has been duly notified in writing and has been given a one year period to either transition into or out of the GSA function for the Area. BYRON-BETHANY IRRIGATION DISTRICT ZONE 7 OF THE ALAMEDA COUNTY FLOOD CONTROL & WATER CONSERVATION DISTRICT By: Rick Gilmore Dated: By: G.F. Duerig Dated:

26 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ENGINEERING CONTACT: Jarnail Chahal AGENDA DATE: April 19, 2017 ITEM NO. 7b SUBJECT: Amendment to Water Supply Contract with DWR to Incorporate Increased Flow Capacity due to South Bay Aqueduct Enlargement SUMMARY: In November 2003, via Contract Amendment No. 24 to Zone 7 s water supply contract with the California Department of Water Resources (DWR), Zone 7 authorized DWR to proceed with enlargement of the South Bay Aqueduct (SBA) to meet Zone 7 s long-term raw water conveyance needs and Zone 7 committed to pay all future capital, and O&M costs. The overall SBA Improvement and Enlargement project was substantially completed in 2014 and it included three components: 1) improvement and rehabilitation of the SBA facility to restore its original 300 cubic feet per second (cfs) design capacity, 2) 130 cfs enlargement of SBA for Zone 7, and 3) construction of Off-Peak Power pumping facilities. The Improvement portion of the project is being paid proportionately by the three SBA contractors (Zone 7, Alameda County Water District and Santa Clara Valley Water District); the enlargement portion is being entirely paid by Zone 7; and the Off-Peak Power portion is being paid by all State Water Project contractors. DWR debt financed the capital cost of the project through issuance of revenue bonds. Staff recommends that the Board authorize the General Manager to negotiate and execute Amendment No. 26 to Zone 7 s water supply contract with DWR to incorporate Zone 7 s increased SBA capacity. Execution of this amendment will allow DWR to adjust the cost recovery factors to reflect Zone 7 s increased share (27% to 49%) of the SBA. Due to the increased Zone 7 capacity in the SBA, Zone 7 s operational costs such as Minimum Operation, Maintenance, Power and Replacement (minimum OMPR) transportation charges are estimated to increase by approximately $1 to 1.5 million/year, starting in 2015 when the enlargement project came online. DWR is planning to include these charges in Zone 7 s 2018 Statement of Charges, including catch up costs for years 2015, 2016 and FUNDING: SBA related minimum OMPR charges are funded from Fund 110- State Water Facilities Fund. Funding for the increased Zone 7 cost due to recalculated cost recovery factors will be included in the FY 2017/2018 mid-year budget amendment discussions. RECOMMENDED ACTION: Adopt attached resolution. ATTACHMENTS: 1) Memo providing additional background and discussion of agenda item, and 2) Zone 7 Board Resolution

27 Interoffice Memo Date: April 19, 2017 To: Jill Duerig, General Manager From: Jarnail Chahal, Engineering Manager Subject: Amendment to Water Supply Contract with DWR to incorporate increased flow capacity due to South Bay Aqueduct Enlargement The following provides additional background and discussion of the above-referenced agenda item. BACKGROUND: After completion of Zone 7 s Water Supply Master Plan in 1999, Zone 7 acquired 34,619 acre-feet of additional State Water Project water from Kern County area State Water Project contractors. Zone 7 executed contract amendment Nos. 19, 20, 21, 23 and 25 to its water supply contract with the California Department of Water Resources (DWR) to incorporate the increased Table-A amount. These amendments increased Zone 7 s Table-A amount from 46,000 acre-feet per year to 80,619 acre-feet per year. Amendment Nos. 19 and 20 also included purchase of South Bay Aqueduct (SBA) conveyance capacity reserved for a potential future fourth SBA contractor. Zone 7 s 1999 Water Supply Master Plan and follow-up Water Conveyance Study (2001) identified our long-term raw water conveyance needs to be an additional 130 cubic feet per second (cfs), and the optimum alternative to be an enlargement of the South Bay Aqueduct. The California Department of Water Resources had already planned an SBA rehabilitation and improvement project to the aging (over 40-year old) SBA facility to restore its original 300 cfs design flow capacity. In November 2003, via Contract Amendment No. 24 to Zone 7 s water supply contract with DWR, Zone 7 authorized DWR to include enlargement of the South Bay Aqueduct (SBA) to meet Zone 7 s long-term raw water conveyance needs through build-out and Zone 7 committed to pay all future capital, and operations and maintenance (O&M) costs related to the enlargement. This amendment also provided for financing by DWR of the enlargement portion of the capital costs via revenue bonds, with annual debt service payments by Zone 7. The overall SBA Improvement and Enlargement project included three components: 1) improvement and rehabilitation of the aging SBA facility to restore its original 300 cfs design conveyance capacity, 2) enlargement of SBA facilities to provide additional conveyance capacity requested by Zone 7, and 3) construction of Off-Peak Power pumping facilities. The improvement and rehabilitation portion of the project is being paid proportionately by the three SBA contractors (Zone 7, Alameda County Water District and Santa Clara Valley Water District); the enlargement portion is being entirely paid by Zone 7; and the Off-Peak Power portion is being paid by all power using State Water Project contractors. DWR debt financed the capital cost of the project through issuance of revenue bonds and the SBA contractors shall continue debt service payments, regardless of water purchases. The project scope included improvement and enlargement of the South Bay Pumping Plant (SBPP), improvements and upsizing of power supply to the SBPP, construction of the Dyer Reservoir, raising of

28 canal embankments and lining, relining the Altamont Pipeline section of the SBA, enlargement of a 54- inch pipe under I-580 with a 78-inch pipe, raising Patterson Pass Reservoir embankment and lining, enlargement and reconstruction of several siphons and bridge crossings over the aqueduct, reconstruction of check gate structures along the aqueduct, and improvements to existing turnouts, and construction of a new turnout for Zone 7. The construction of the SBA Improvement and Enlargement project was substantially completed in 2014 and came online in DISCUSSION: The SBA enlargement portion of the project provided 130 cubic feet per second (cfs) of additional raw water conveyance capacity for Zone 7 in Reach 1 of the SBA up to Dyer Reservoir, and 80 cfs of additional capacity in Reach 1 below Dyer Reservoir, Reach 2 and Reach 4 of the SBA. Reach 1 of the SBA ends at I-580, Reach 2 ends near Zone 7 s Patterson Pass Water Treatment Plant (Reach 3 does not exist), and Reach 4 ends at Del Valle branch pipeline junction. Dyer Reservoir provided 500 acre-feet of total storage, 300 acre-feet of storage was constructed for Zone 7, and 200 acre-feet for Off-Peak Power pumping. The project also constructed a new Turnout for Zone 7 near Dyer Reservoir. Since the SBA Improvement and Enlargement project has been completed and online since 2015, the Zone 7 water supply contract needs to be amended to incorporate Zone 7 s increased SBA conveyance capacity. DWR has prepared a draft contract Amendment No. 26 to the Zone 7 contract. Execution of this amendment will document the increase in Zone 7 s conveyance capacity in the SBA. The amendment will also allow DWR to adjust the cost recovery factors to reflect Zone 7 s increased share of the SBA capacity. Prior to enlargement of the SBA, Zone 7 s share of the SBA conveyance capacity was approximately 27% (82cfs/300cfs in Reach 1) including purchase of the fourth contractor share. After the enlargement, Zone 7 s share of SBA conveyance capacity increased to approximately 49% ((82cfs+130cfs)/430cfs in Reach 1). Due to the increased Zone 7 conveyance capacity share in the SBA, Zone 7 s operational costs such as Minimum Operation, Maintenance, Power and Replacement (minimum OMPR) transportation charges were supposed to increase by approximately $1 to 1.5 million/year, starting in 2015 when the project came online. DWR did not include this increased cost in Zone 7 s Statement of Charges for 2015, 2016 and 2017 because DWR required an amendment to Zone 7 s water supply contract to reflect Zone 7 s increased flow capacity. After execution of Amendment No. 26, DWR is planning to retroactively recalculate the charges and include them in Zone 7 s 2018 State Water Project Statement of Charges. Once DWR collects these charges from Zone 7, it will result in some credit to the other two SBA contractors (Alameda County Water District and Santa Clara Valley Water District) for Zone 7 s SBA related minimum OMPR charges are funded from Fund 110- State Water Facilities Fund. Funding for the increased Zone 7 cost due to recalculated cost recovery factors will be included in the FY 2017/2018 mid-year budget amendment discussions. Staff recommends that the Board authorize the General Manager to negotiate and execute Contract Amendment No. 26 to Zone 7 s water supply contract with DWR to incorporate Zone 7 s increased SBA capacity.

29 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT BOARD OF DIRECTORS INTRODUCED BY SECONDED BY RESOLUTION NO. Amendment to Water Supply Contract with DWR to incorporate increased flow capacity due to South Bay Aqueduct Enlargement WHEREAS, in November 2003, via Contract Amendment No. 24 to Zone 7 s water supply contract with the California Department of Water Resources (DWR), Zone 7 authorized DWR to proceed with enlargement of the South Bay Aqueduct (SBA) to meet Zone 7 s long-term raw water conveyance needs and Zone 7 committed to pay all future capital, and O&M costs; and WHEREAS, the South Bay Aqueduct enlargement provided 130 cubic feet per second (cfs) of additional raw water conveyance capacity for Zone 7 in Reach 1 of the SBA up to Dyer Reservoir, and 80 cfs of additional capacity in Reach 1 below Dyer Reservoir, Reach 2 and Reach 4 of the SBA; and WHEREAS, Zone 7 s water supply contract with the California Department of Water Resources needs to be amended to incorporate Zone 7 s increased SBA conveyance capacity. NOW, THEREFORE, BE IT RESOLVED that the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District does hereby authorize the General Manager to negotiate and execute a contract amendment to Zone 7 s water supply contract with the California Department of Water Resources to incorporate Zone 7 s increased SBA capacity. ADOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, By: President, Board of Directors

30 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: INTEGRATED PLANNING CONTACT: Sal Segura/Amparo Flores AGENDA DATE: April 19, 2017 ITEM NO. 7c SUBJECT: 2017 Annual Review of Sustainable Water Supply for Zone 7 Water Agency SUMMARY: Zone 7 expects to receive at least a 60% allocation (48,400 AF) from the State Water Project (SWP) in Lake Del Valle captured 8,900 AF in 2016 and 4,300 AF in 2017 to-date. Zone 7 anticipates capturing additional local water in the fall of Zone 7 expects to have access to 57,600 AF of incoming surface water supply available in 2017 including SWP Table A water, local water, and water from the Yuba Accord and SWP Turnback Pools. Storage is planned to add another 14,800 AF. The current supply of surface water is sufficient to store excess supplies in the local groundwater basin, in SWP facilities, and in Kern County Water Banks (Semitropic and Cawelo). Delivery requests, based on retailers projections, for 2017 total 46,800 AF. This is 40% greater than actual 2016 deliveries (33,112 AF). Zone 7 can deliver 100% of requested water deliveries in 2017 and 2018 even if conditions turn critically dry in Zone 7 also expects to meet demands over , assuming average conditions over that time. Current conservation levels indicate much lower demands than delivery requests; Zone 7 staff will continue to monitor both state and local conditions, and will adjust operations and projections accordingly. FUNDING: Reductions in water use associated with ongoing voluntary conservation will decrease water sales revenue. RECOMMENDED ACTION: Information only. ATTACHMENTS: Memorandum 1

31 INTEROFFICE MEMORANDUM DATE: April 19, 2017 TO: Jill Duerig, General Manager FROM: Sal Segura, Associate Civil Engineer, Integrated Planning SUBJECT: Annual Review of Sustainable Water Supply for Zone 7 Water Agency On October 17, 2012, Zone 7 Water Agency (Zone 7) adopted the Water Supply Reliability Policy (Resolution , see Attachment A), which requires an annual review of sustainable water supplies (Annual Review). This memorandum presents the Annual Review and covers the following: Drought Recovery Key Hydrologic and Water Supply Conditions Projected Water Demands: Next Five Years Projected Water Supplies: Next Five Years Comparison of Supply and Demand: Next Five Years Programs Necessary to Meet Water Demands Going Forward SUMMARY OF FINDINGS As of April 1, 2017, Zone 7 has received a 60% allocation (48,400 acre-feet [AF]) from the State Water Project (SWP) for This amount may increase depending on SWP operational conditions. Of the 9,400 AF of SWP Carryover available at the beginning of 2017, 2,400 AF was used prior to San Luis Reservoir filling, at which point the remainder of 7,000 AF was lost. Lake Del Valle captured local runoff of 8,900 AF in 2016, and about 4,300 AF has been captured in 2017 to-date; more local water is expected in the fall of Additionally, the Yuba Accord and the SWP Turnback Pools are expected to yield 1,200 AF. Altogether, the current projected surface water supply is large enough that Zone 7 can use surplus water to increase storage locally, in Kern County and in SWP facilities as carryover. Zone 7 currently has 60,400 AF of supply available for direct use in 2017 (compared to a delivery request of 46,800 AF) and expects this amount to increase per the final SWP allocation sometime in late April. A comparison of projected water supply and demand indicates that Zone 7 can deliver 100% of requested water deliveries in 2017 and 2018 even if conditions turn critically dry in 2018 and there is minimal conservation in those years. Zone 7 also expects to meet demands over , assuming average conditions over that time. Zone 7 is evaluating several potential future water supply and storage options including the California WaterFix, Bay Area Regional Desalination, Sites Reservoir, Los Vaqueros Expansion, Potable Reuse, and Lake Del Valle Expansion to bolster long-term water supply reliability. Zone 7 will continue to promote and monitor water conservation activities, monitor local conditions, adjust operations as necessary to optimize use of available resources, remain prepared for another single or multi-year drought, and continue to coordinate regularly with its local water supply retailers and untreated water customers. 1

32 DROUGHT RECOVERY On April 1, 2015, the Statewide Sierra snowpack measured five percent of average the lowest level ever recorded. This record low snowpack, in combination with decreased water levels in reservoirs, led to a mandatory 25% reduction in water use statewide. Hydrologic conditions significantly improved over the 2016 water year (October 1, 2015-September 30, 2016); for example, precipitation in the Northern Sierras ended at 116% of average while local precipitation was at 106% of average. In response to improved conditions, on May 18, 2016, the State Water Resources Control Board (State Board) directed water providers to determine the level of local conservation necessary to sustain another three years of drought following As reported to the State Board, given Zone 7 s 2016 supply and storage conditions, there was no need for mandatory conservation within the service area for the foreseeable future. On June 15, 2016, the Zone 7 Board lifted the local drought emergency, set a voluntary 10% conservation target to support ongoing statewide water conservation efforts, and directed staff to continue working with the water retailers to promote wise use of water. On February 8, 2017, the State Board adopted an emergency water conservation regulation to amend and extend the May 18, 2016 regulation; the amended regulation allowed certain suppliers the opportunity to submit or resubmit their water supply reliability assessments by March 15, 2017 and it did not require mandatory conservation unless water suppliers determined that they have a shortfall. Since Zone 7 continues to have sufficient water supplies to meet demands without the need for mandatory conservation, Zone 7 did not resubmit the water supply reliability assessment, and has maintained a 10% voluntary conservation target. On April 7, 2017, Governor Jerry Brown declared California s drought emergency officially over, but renewing his commitment to make conservation a way of life in California. As of the end of March 2017, water year 2017 (October 1, 2016-September 30, 2017) is expected to surpass the wettest year on record ( ) in the Sacramento River and San Joaquin River watersheds, but appears to be close to the second wettest year on record ( ) for the Zone 7 service area. KEY HYDROLOGIC AND WATER SUPPLY CONDITIONS Lake Oroville Spillway Repairs It is unclear at this time if the anticipated repairs to the Oroville spillway will have impacts on near-term allocation and water supply delivery; however, DWR has stated that they expect the allocation to remain at no less than 60%. No impacts are anticipated to future allocation of water supply. Sierra Snowpack and Precipitation in 2017 The statewide Sierra snowpack was estimated to be 163% of the April 1 st average as of March 31, 2017 (see Attachment B), compared to 86% the same time last year. April 1 st is normally when the snowpack level peaks before the spring melt begins. The snowpack level in northern California, the main source of supply for the SWP during the spring and summer, is at 148% of the April 1 st average. Figure 1 presents a comparison of snow depths in the Sierras in April 2016 versus April Northern Sierra precipitation, which is a strong constituent in SWP allocation, was 83.4 inches and at 201% of average as of March 31, 2017; this is trending higher than the wettest water year conditions (Attachment B). 2

33 Reservoir Conditions in 2017 Statewide, reservoirs are generally full (Attachment B). Oroville and San Luis Reservoir, the main reservoirs for the SWP, were at 76% and 99% of capacity as of March 31, 2017, equivalent to 99% and 109% of historical averages for this date, respectively. Figure 1. Statewide Snowpack in the Sierra Nevada in 2017 is deeper in 2017 than in 2016 (a) Snow Depth April 1, 2016 Snow Depth April 1, 2017 (a) Source: National Weather Service Remote Sensing Center, 3

34 Local Runoff and Precipitation in 2017 The Tri-Valley area has experienced significant runoff this year compared to the same time last year. This increase is shown on Figure 2, which shows that runoff into Lake Del Valle as of April 1, 2017, is already four times higher than the total in 2016 (76,924 AF compared to 19,436 AF). Figure 2 also shows that the 2017 runoff is well above the average of 23,000 AF, making this the second highest runoff measured since 1964 (1983 was the highest); this incoming source of local water will add to Zone 7 s water available this and next year. Local precipitation is at 188% of average for March 31, 2017 at the Livermore Rainfall Station 15E (Attachment B). An estimated 6,000 AF came into Lake Del Valle in March with 5,800 AF released for flood control management. However, Zone 7 was able to use a portion of the flood water release (2,150 AF) at the Del Valle Water Treatment Plant. Conservation in the Tri-Valley Figure 3. Tri-Valley s Response to the Drought Results in Cumulative Water Savings of 48,400 AF from 2014 to % Figure 2. Runoff into Lake Del Valle measured by USGS Stream Gauge Arroyo Valle Below Lang Canyon Average: 23,000 AF The Tri-Valley s successful response to the drought reduced the required water supply delivery from Zone 7 relative to 2013 water demand by 29% in 2014, 37% in 2015 and 33% in 2016; this represents a cumulative water supply savings of over 48,400 AF over the past three years. This dramatic response by the Tri-Valley community is illustrated on Figure 3, which compares by calendar year. These water savings will help Zone 7 meet delivery requests made by the retailers in subsequent years. SWP 2017 Table A Allocation: 60% as of April 1, 2017 The SWP allocation is 60% as of April 1, 2017, reflecting improved hydrologic conditions statewide. When combined with local water supplies captured in Lake Del Valle, this ensures that Zone 7 has significantly more water supplies in 2017 than in 2016, and will not need to recover any drought supplies from groundwater banks in Kern County for The Table A allocation may increase depending on SWP operational conditions. For instance, the Bureau of Reclamation announced on April 11, 2017, that federal South-of-Delta contractors would all receive a 100% allocation in

35 Annual Sustainability Report Assumptions To illustrate Zone 7 s ability to meet 100% of delivery requests made by the retailers, the analysis in this memorandum conservatively assumes critically dry conditions (1977) in 2018, followed by normal or average years in 2019 through PROJECTED WATER DEMANDS: NEXT FIVE YEARS Each year, Zone 7 receives Municipal and Industrial (M&I) delivery requests from the retailers for the next five years (Figure 4 and Table 1). Zone 7 estimates demands for untreated water from agricultural customers. As shown in Table 1 and on Figure 4, the request for 2016 was significantly higher than the actual 2016 water demand (46,900 vs 33,100 AF). Additionally, 2017 water requests for 2017 to 2021 are about 5% lower than the 2016 projections. Zone 7 s retailers are projecting about 97% recovery to 2013 pre-drought demand in 2017 (41,800 vs 43,100 AF, see Figure 5). Zone 7 s projection for 2017 retailer demand is significantly lower at 34,500 AF, based on current conservation trends as of March 2017 (see Figure 5). For conservative planning purposes, Zone 7 staff is using the retailers higher delivery requests Figure Delivery Requests Increase to 2013 Demands by for this analysis; if actual water use is lower, Zone 7 will have even more water supply available for 2018 than shown in this report. Figure 6 shows untreated water demand requests used in the analysis. Table versus 2016 Five-Year Water Delivery Requests, acre-feet (a) M&I water Ag 2013 Demand Component 2013 (actual) 2014 (actual) 2015 (actual) 2016 (actual) M&I (b,c,d) 43,052 30,155 25,406 28,434 41,800 42,700 43,400 43,900 45,100 Untreated (e) 6,174 4,981 5,639 4,678 5,000 5,300 5,500 5,500 5,500 Total 2017 Request 49,226 35,136 31,045 33,112 46,800 48,000 48,900 49,400 50, Delivery Request 46,900 49,500 50,600 51,200 51,800 % Increase from 2016 Delivery Request -5.5% -5.1% -4.5% -4.6% (a) (b) (c) (d) (e) Projected demands were rounded to the nearest 100 acre-feet. M&I = Municipal and Industrial. Demand projections were provided as delivery requests by California Water Service Company, Dublin San Ramon Services District, City of Livermore, and City of Pleasanton. Zone 7 estimated demands from direct retail customers. Demands include Zone 7 s unaccounted-for water and the groundwater-pumping quota for Dublin San Ramon Services District. Zone 7 s untreated water demand is used primarily for agricultural irrigation. 5

36 Figure 5. Retailers are projecting a 95% recovery to 2013 demand in 2017, while Zone 7 projects 80% recovery. Figure 6. Agricultural demands are highly variable, and are assumed to increase by over 500 AF between 2017 & 2021 Zone 7 s Projection for 2017 PROJECTED WATER SUPPLIES: NEXT FIVE YEARS The purpose of this section is to review the water supplies, including contracted supply and available water in storage for 2017; projections for 2018 to 2021 are also provided. Projected Yield from Contracted Water Supplies in 2017 and Beyond Each year Zone 7 receives water from its contract with DWR for imported SWP water 1, its local water right permit on Arroyo del Valle, its agreement with Byron Bethany Irrigation District, and its agreement with DWR for Yuba Accord Water and other water (e.g., SWP multi-year pool). Table 2 presents the expected yield in 2017, an estimate for 2018 assuming 1977 critically dry hydrologic conditions, followed by normal or average years from 2019 through While Zone 7 requested water from BBID in 2017, no water was assumed available as the BBID agreement is being re-evaluated. As shown in Table 2 and Figure 7, Zone 7 expects 57,600 acre-feet of water supply from its current contracts in 2017, or 45,600 AF after accounting for treated water operational losses and storage reserve (SWP carryover) for next year. If the drought were to resume in 2018 (assuming 1977 conditions and a 10% allocation), Zone 7 may only receive 9,100 AF of new imported supply available for direct use and perhaps no local supply. Figure 7. Zone 7 is expecting 57,600 acre-feet from existing contracts in 2017 SWP: 48,400 AF Yuba: 500 AF 57,600 AF LDV Yield: 8,000 AF Turnback Pool: 700 AF BBID: 0 AF 1 This includes carryover from 2016, which is discussed in the next section. 6

37 Table 2. Projected Yield from Existing Contracted Water Supplies, acre-feet Source (a) 2017 (1998) 2018 (1977) 2019 (Average) 2020 (Average) 2021 (Average) Table A (b) 48,400 8,100 50,000 50,000 50,000 Byron Bethany Irrigation District (e) LDV Yield 8,000 (c) 0 7,300 7,300 7,300 Yuba Accord 500 1,500 1,000 1,000 1,000 Turnback Pool Program Subtotal 57,600 9,600 58,300 58,300 58,300 Treated Water Operational Losses (d) -2, ,100-2,100-2,200 Carryover into Following Year -10, ,000-10,000-10,000 Total Supply for Direct Use 45,600 9,100 46,200 46,200 46,100 (a) See Zone 7 s 2015 Urban Water Management Plan for more details about Zone 7 supplies: (b) 2017 yield is based on 60% (current 2017 allocation) of 80,619 AF. Long-term average yield is 62% of Zone 7 s Table A amount (80,619 AF) per DWR s Final 2015 Delivery Capability Report. (c) The 2017 amount is currently 4,300 AF and expected to increase to approximately 8,000 AF by the end of the December. (d) Operational losses associated with unaccounted-for water. (e) For conservative planning purposes, no water was assumed to be available under this contract. Figure Water Supply from Storage Available Storage in 2017 and Beyond Zone 7 currently stores surplus water in various storage facilities, including Kern County groundwater banking programs, to help meet water demands when needed during dry years. Figure 8 shows that no water supply from storage is planned for use in Table 3 summarizes the total accrued water in storage available to Zone 7 over the next five years, the estimated water in storage available as of April 1, 2017, and estimated water supply from storage planned for use between 2018 and As shown in Table 3, Zone 7 is not planning on banked water recovery from Kern County in 2017 (and in fact will be placing water into storage), and should have access to its full pumpback amounts in 2018 should conditions become critically dry. 14,800 AF Ground water Semitropic& Cawelo 3,500 AF Minimal pumping required in 2017 Del Valle Carryover SWP Carryover 8,900 AF 2,400 AF 7,000 AF was lost when San Luis reservoir filled 0 AF - not required Zone 7 plans to send water to storage banks Depending on the final SWP allocation, Zone 7 plans to send at least 8,000 AF to storage in Kern Water Banks. This will increase Zone 7 s storage in the water banks by over 6,000 AF. 7

38 (a) (b) (c) (d) (e) (f) (g) Table 3. Available Storage, acre-feet Total Accrued Water in Storage (a) 2017 (1998) Estimated Supply in Storage Planned to be Used 2018 (1977) 2019 (Average) 2020 (Average) 2021 (Average) Source Main Groundwater Basin 116,000 3,500 (b) 14,000( b) 5,000 (c) 5,000 (c) 5,000 (c) Lake Del Valle Carryover (d) 8,900 8,900 8, ,300 7,300 State Water Project Carryover (e) 2,400 2,400 10, ,000 10,000 Semitropic (f) 63, , Cawelo (g) 18, Total 209,400 14,800 40,000 5,000 22,300 22,300 Accrued storage estimate reflects the status on 4/1/2017. For groundwater, this is equivalent to 91% of operational storage. Minimal pumping is required in 2017 due to the sizable SWP allocation of 60%, which allows Zone 7 to plan for greater pumping in 2018 in case of dry conditions. For 2018, Zone 7 staff estimates that approximately 14,000 acre-feet can be accessed via groundwater pumping. A conservative pumping amount of 5,000 acre-feet was used for years classified as normal or average. Zone 7 carried over 8,900 AF into The analysis assumes there would be no carryover following a critically dry year. Zone 7 s total SWP carryover from 2016 into 2017 is 9,400 acre-feet but due to the wet hydrology, only 2,400 AF was accessible before San Luis Reservoir filled and the remainder was lost. Zone 7 typically carries over about 10,000 acre-feet from year to year during average conditions. On an annual basis, Zone 7 can recover up to 9,100 acre-feet from Semitropic via pumpback, and depending on the SWP allocation, also recover additional water via exchange. Cawelo can produce up to 10,000 AF per year between September and March once requested. COMPARISON OF SUPPLY AND DEMAND: NEXT FIVE YEARS Table 4 compares available water supplies to projected baseline water demands over the next five years. For comparative purposes in this Annual Review, a critically dry condition was assumed for 2018 and average or normal conditions were assumed over the following years. As previously noted, the retailers delivery requests were conservatively assumed for the demands. As shown in Table 4, Zone 7 can deliver enough water to supply 100% of delivery requests for 2017 and 2018 even if there is no conservation in either year, and drought conditions return in Table 4 also shows that Zone 7 can meet 100% of water deliveries if normal or average hydrologic conditions resume starting in Figure 9. Zone 7 has sufficient water to deliver 100% of requested deliveries in 2017 and 2018 even with minimal conservation. 100% 100% Water Demand (1998) (1977) 8

39 Table 4. Comparison of Supply and Demand: Next Five Years 2017 (1998) 2018 (1977) 2019 (Average) 2020 (Average) 2021 (Average) Component Water Supply (minus carryover) (a) 45,600 9,100 46,200 46,200 46,100 Water Supply in Storage Available for Use 14,800 40,000 5,000 22,300 22,300 Total Water Supply (b) 60,400 49,100 51,200 68,500 68,400 Water Demand (c) 46,800 48,000 48,900 49,400 50,600 % of Demand Delivered 100% 100% 100% 100% 100% (a) (b) (c) This analysis assumes that Zone 7 carries 10,000 AF over into 2018, 0 AF into 2019, and 10,000 AF into 2020 and Excess water supplies are used to replenish the local groundwater basin and banking programs in Kern County. Includes both M&I and Untreated water demands, which are based on the retailers delivery requests. PROGRAMS NECESSARY TO MEET WATER DEMANDS GOING FORWARD The review completed as part of this memorandum indicates that Zone 7 has sufficient water supplies to meet projected water demands over the next five years even if there is little to no conservation, and water demands recover to 95% of 2013 levels by As discussed, however, Zone 7 s actual water demands are currently much lower than 2013 levels, which suggest there will likely be much more supply available between 2018 and 2021 than shown in the conservative analysis completed in this Annual Review. Excess water supply will be used to replenish the local groundwater basin and to add to storage in banking programs in Kern County to prepare for dry years. As presented in the 2015 Urban Water Management Plan, and evaluated in detail in the 2016 Water Supply Evaluation Update, Zone 7 is evaluating several potential future water supply and storage options to bolster long-term water supply reliability. Additional projects were also identified and approved in Future water supply and storage alternatives being evaluated include: California WaterFix Sites Reservoir Los Vaqueros Reservoir Expansion Potable Reuse Lake Del Valle Expansion of Storage Capacity Bay Area Regional Desalination Zone 7 will continue to promote and monitor conservation activities. Zone 7 staff will also continue to monitor local conditions, adjust operations as necessary to optimize use of available resources, remain prepared for another single or multi-year drought, and continue to coordinate regularly with its local water supply retailers and untreated water customers. 9

40 ATTACHMENT A: WATER SUPPLY RELIABILITY POLICY 10

41

42

43

44 ATTACHMENT B: LATEST HYDROLOGIC CONDITIONS 11

45 California Snow Water Content as of March 31, 2017 Northern Sierra Precipitation as of March 31, 2017 Statewide Average: 163% 12

46 California Reservoir Conditions as of March 31,

47 Local Rainfall (Livermore Station 15E NOAA) as of March 31,

48 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: INTEGRATED WATER RESOURCES CONTACT: Tami Church/Carol Mahoney AGENDA DATE: April 19, 2017 ITEM NO. 7d SUBJECT: EPA Water Quality Improvement Fund Grant Application Authorization SUMMARY: Recently, the U.S. Environmental Protection Agency (EPA) for the San Francisco Bay Area (Region 9) announced a solicitation for grant proposals associated with their Water Quality Improvement Fund (WQIF) to improve water quality and restore aquatic habitat. The applications are due May 10, In consultation with the San Francisco Estuary Institute (SFEI), Zone 7 has been exploring various options for projects that may be eligible within our service area. One of these projects involves improvements along the Verona Reach where Zone 7 is currently working to complete emergency work. Other potential grant partners include, but are not limited to local cities, Alameda County, San Francisco Public Utilities Commission (which owns property downstream of Verona Bridge), Alameda County Resource Conservation District/US Natural Resources Conservation Service, San Francisco Estuary Partnership, etc. The grant request is capped at $2 million per project; based on initial discussions, staff estimates a grant request of up to $1.5 million might be appropriate. The grant program requires that participants provide local matching funds of 50% of the grant request to be available for planning, design, and construction. The funds that we are spending on the emergency repair along Foothill Drive may be eligible for a portion of this grant match, but this depends on the timing of award. At this time, Zone 7 anticipates that either SFEI or SFEP would act as the grant lead and fiscal agent. This is similar to other Integrated Regional Water Management program grants that have been awarded to Zone 7 and administered by others. Due to the relatively short turn around on the grant application, Staff are requesting that the Board authorize the General Manager to participate in a grant application for the WQIF, including letters of support, administration, and/or contributing matching funds, should the grant be awarded. FUNDING: Funding is available in Fund 200 and Fund 210. RECOMMENDATION: Adopt the attached resolution. ATTACHMENT: Resolution

49 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT BOARD OF DIRECTORS RESOLUTION NO. INTRODUCED BY SECONDED BY AUTHORIZATION TO APPLY FOR WQIF GRANT FUNDING WHEREAS, Zone 7 of the Alameda County Flood Control and Water Conservation District, (Zone 7) regularly enters into partnerships for grant opportunities or to share resources with other Bay Area organizations to improve water management within the service area; and WHEREAS, the San Francisco Estuary Institute and/or the San Francisco Estuary Partnership have acted as fiscal agents for the preparation and submission of grant applications for various projects in which Zone 7 has been a party in the past; and WHEREAS, the U.S. Environmental Protection Agency (EPA) for the San Francisco Bay Area (Region 9) announced a solicitation for grant proposals associated with their Water Quality Improvement Fund (WQIF) to improve water quality and restore aquatic habitat; and WHEREAS, improvements to water quality and restoration of aquatic habitat is consistent with Zone 7 s Stream Management Master Plan; and WHEREAS, Zone 7 has adequate matching dollars in Fund 200 and/or Fund 210 to commit to a project that meets the grant requirements; NOW, THEREFORE, BE IT RESOLVED, that the Zone 7 Board of Directors does hereby approve and authorize the General Manager to prepare, execute, and submit necessary grant application documents and assurances, in collaboration with appropriate grant partners, to the EPA WQIF. ADOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, By: President, Board of Directors

50 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING DIVISION: ADMINISTRATIVE SERVICES CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO. 7e SUBJECT: Board Resolutions for the Drinking Water State Revolving Fund SUMMARY: The FY Adopted Budget assumes borrowing up to $43 million to fund water system capital improvement projects. On May 18, 2016, the Zone 7 Board adopted Resolution No awarding contracts for planning, design engineering, design review and technical support services for the Del Valle Water Treatment Plant (DVWTP) Ozone Project. On November 16, 2016, the Zone 7 Board adopted Resolution No authorizing the General Manager to execute and submit all documents necessary to complete a Drinking Water State Revolving Fund (DWSRF) funding application. On December 21, 2016, the Zone 7 Board adopted Resolution No , amending the Patterson Pass Water Treatment Plant (PPWTP) Clearwell and New Filters Project design contract to include ozone at PPWTP. The DWSRF application process consists of submitting four separate application packages General Information, Financial Assistance, Environmental and Technical. The first step in the process submittal of a General Information Application Package to determine if the project would qualify for funding was completed on January 7, 2017 in the amount of $41.5 million for both the DVWTP and PPWTP ozone projects. Subsequent applications will be submitted separately for each plant because the projects have different schedules. Submittal of the Financial Assistance Application requires adoption of two separate Board resolutions: a Reimbursement Resolution and a Pledged Revenues and Fund Resolution. The reimbursement resolution declares Zone 7 s intent to pay project costs as they occur and prior to being reimbursed with DWSRF loan proceeds. The resolution also sets a maximum principal amount of the loan. The Pledged Revenues and Fund Resolution pledges net water revenue from water enterprise funds toward payment of the DWSRF loan, authorizes the General Manager to sign a DWSRF financing agreement to ensure that Zone 7 is carrying out its responsibilities under the agreement. These resolutions follow the templates provided by DWSRF and have been reviewed by Zone 7 s General Counsel. Staff recommends adopting the attached resolutions (two for each plant). RECOMMENDED ACTION: Adopt the four attached resolutions.

51 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION AGENCY BOARD OF DIRECTORS RESOLUTION NO INTRODUCED BY SECONDED BY PLEDGED REVENUES AND FUNDS RESOLUTION THE DEL VALLE WATER TREATMENT PLANT OZONE PROJECT WHEREAS, the Zone 7 Water Agency (the Agency ) seeks financing from the State Water Resources Control Board for a project commonly known as the Del Valle Water Treatment Plant Ozone Project (the "Project"); and WHEREAS, on May 18, 2016, the Agency Board adopted Resolution No awarding contracts for planning, design engineering, design review and technical support services for the Project; and WHEREAS, the Agency intends to finance the construction of the Project or portions of the Project with the Drinking Water State Revolving Fund (DWSRF) money ("Project Funds") provided by the State of California, acting by and through the State Water Resources Control Board (State Water Board); NOW, THEREFORE, BE IT RESOLVED BY THE ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE 7 BOARD OF DIRECTORS, that; 1. The General Manager is hereby authorized and directed to sign and file, for and on behalf of the Agency, a financial assistance application for a financing agreement from the State Water Resources Control Board for the Project; 2. The General Manager or designee is hereby authorized to sign the DWSRF program financing agreement for the Project and any amendments thereto, and provide the assurances, certifications and commitments required therefore; 3. The General Manager or designee is hereby authorized to represent the Agency in carrying out the Agency s responsibilities under the financing agreement, including approving and submitting disbursement requests (including Claims for Reimbursement) or other required documentation, in compliance with applicable state and federal laws, and making any other necessary certifications; 4. The Agency does hereby dedicate and pledge its net water enterprise system revenues and its water enterprise fund to payment of the DWSRF financing for the Project; 5. The Agency commits to collecting such revenues and maintaining such fund(s) throughout the term of such financing and until the Agency has satisfied its repayment obligation thereunder

52 unless modification or change is approved in writing by the State Water Resources Control Board. So long as the financing agreement(s) are outstanding, the Agency pledge hereunder shall constitute a lien in favor of the State Water Resources Control Board on the foregoing fund(s) and revenue(s) without any further action necessary. So long as the financing agreement(s) are outstanding, the Agency commits to maintaining the fund(s) and revenue(s) at levels sufficient to meet its obligations under the financing agreement(s). If for any reason, the said source of revenues proves insufficient to satisfy the debt service of the DWSRF obligation, sufficient funds shall be raised through increased water rates, user charges, or assessments or any other legal means available to meet the DWSRF obligation and to operate and maintain the project; and 6. The authority granted hereunder shall be deemed retroactive. All acts authorized hereunder and performed prior to the date of this Resolution are hereby ratified and affirmed. The State Water Resources Control Board is authorized to rely upon this Resolution until written notice to the contrary, executed by each of the undersigned, is received by the State Water Resources Control Board. The State Water Resources Control Board shall be entitled to act in reliance upon the matters contained herein, notwithstanding anything to the contrary contained in the formation documents of the Agency or in any other document applicable state and federal laws. ADOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation Agency on April 19, By President, Board of Directors

53 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION AGENCY BOARD OF DIRECTORS RESOLUTION NO INTRODUCED BY SECONDED BY REIMBURSEMENT RESOLUTION FOR THE DEL VALLE WATER TREATMENT PLANT OZONE PROJECT WHEREAS, the Zone 7 Water Agency (the "Agency") desires to finance the costs of constructing and/or reconstructing certain public facilities and improvements relating to its water system, including certain treatment facilities, pipelines and other infrastructure (the "Project"); and WHEREAS, the Agency intends to finance the construction and/or reconstruction of the Project or portions of the Project with moneys ("Project Funds") provided by the State of California, acting by and through the State Water Resources Control Board (State Water Board); and WHEREAS, the State Water Board may fund the Project Funds with proceeds from the sale of obligations the interest upon which is excluded from gross income for federal income tax purposes (the "Obligations"); and WHEREAS, prior to either the issuance of the Obligations or the approval by the State Water Board of the Project Funds the Agency desires to incur certain capital expenditures (the "Expenditures") with respect to the Project from available moneys of the Agency; and WHEREAS, the Agency has determined that those moneys to be advanced on and after the date hereof to pay the Expenditures are available only for a temporary period and it is necessary to reimburse the Agency for the Expenditures from the proceeds of the Obligations. NOW, THEREFORE, BE IT RESOLVED BY THE ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE 7 BOARD OF DIRECTORS, that; 1. The Agency hereby states its intention and reasonably expects to reimburse Expenditures paid prior to the issuance of the Obligations or the approval by the State Water Board of the Project Funds. 2. The reasonably expected maximum principal amount of the Project Funds is $30 million. 3. This resolution is being adopted no later than sixty (60) days after the date on which the Agency will expend moneys for the construction portion of the Project costs to be reimbursed with Project Funds. 4. Each Agency expenditure will be of a type properly chargeable to a capital account under general federal income tax principles.

54 5. To the best of our knowledge, this Agency is not aware of the previous adoption of official intents by the Agency that have been made as a matter of course for the purpose of reimbursing expenditures and for which tax-exempt obligations have not been issued. 6. This resolution is adopted as official intent of the Agency in order to comply with Treasury Regulation and any other regulations of the Internal Revenue Service relating to the qualification for reimbursement of Project costs. 7. All the recitals in this Resolution are true and correct and this Agency so finds, determines and represents. ADOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation Agency on April 19, By President, Board of Directors

55 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION AGENCY BOARD OF DIRECTORS RESOLUTION NO INTRODUCED BY SECONDED BY PLEDGED REVENUES AND FUNDS RESOLUTION THE PATTERSON PASS WATER TREATMENT PLANT OZONE PROJECT WHEREAS, the Zone 7 Water Agency (the Agency ) seeks financing from the State Water Resources Control Board for a project commonly known as the Patterson Pass Water Treatment Plant Ozone Project (the "Project"); and WHEREAS, on December 21, 2016, the Zone 7 Board adopted Resolution No , amending the Patterson Pass Water Treatment Plant Clearwell and New Filters Project design contract to include ozone at Patterson Pass Water Treatment Plant; and WHEREAS, the Agency intends to finance the construction of the Project or portions of the Project with the Drinking Water State Revolving Fund (DWSRF) money ("Project Funds") provided by the State of California, acting by and through the State Water Resources Control Board (State Water Board); NOW, THEREFORE, BE IT RESOLVED BY THE ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE 7 BOARD OF DIRECTORS, that; 1. The General Manager is hereby authorized and directed to sign and file, for and on behalf of the Agency, a financial assistance application for a financing agreement from the State Water Resources Control Board for the Project; 2. The General Manager or designee is hereby authorized to sign the DWSRF program financing agreement for the Project and any amendments thereto, and provide the assurances, certifications and commitments required therefore; 3. The General Manager or designee is hereby authorized to represent the Agency in carrying out the Agency s responsibilities under the financing agreement, including approving and submitting disbursement requests (including Claims for Reimbursement) or other required documentation, in compliance with applicable state and federal laws, and making any other necessary certifications; 4. The Agency does hereby dedicate and pledge its net water enterprise system revenues and its water enterprise fund to payment of the DWSRF financing for the Project;

56 5. The Agency commits to collecting such revenues and maintaining such fund(s) throughout the term of such financing and until the Agency has satisfied its repayment obligation thereunder unless modification or change is approved in writing by the State Water Resources Control Board. So long as the financing agreement(s) are outstanding, the Agency pledge hereunder shall constitute a lien in favor of the State Water Resources Control Board on the foregoing fund(s) and revenue(s) without any further action necessary. So long as the financing agreement(s) are outstanding, the Agency commits to maintaining the fund(s) and revenue(s) at levels sufficient to meet its obligations under the financing agreement(s). If for any reason, the said source of revenues proves insufficient to satisfy the debt service of the DWSRF obligation, sufficient funds shall be raised through increased water rates, user charges, or assessments or any other legal means available to meet the DWSRF obligation and to operate and maintain the project; and 6. The authority granted hereunder shall be deemed retroactive. All acts authorized hereunder and performed prior to the date of this Resolution are hereby ratified and affirmed. The State Water Resources Control Board is authorized to rely upon this Resolution until written notice to the contrary, executed by each of the undersigned, is received by the State Water Resources Control Board. The State Water Resources Control Board shall be entitled to act in reliance upon the matters contained herein, notwithstanding anything to the contrary contained in the formation documents of the Agency or in any other document applicable state and federal laws. ADOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation Agency on April 19, By President, Board of Directors

57 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION AGENCY BOARD OF DIRECTORS RESOLUTION NO INTRODUCED BY SECONDED BY REIMBURSEMENT RESOLUTION FOR THE PATTERSON PASS WATER TREATMENT PLANT OZONE PROJECT WHEREAS, the Zone 7 Water Agency (the "Agency") desires to finance the costs of constructing and/or reconstructing certain public facilities and improvements relating to its water system, including certain treatment facilities, pipelines and other infrastructure (the "Project"); and WHEREAS, the Agency intends to finance the construction and/or reconstruction of the Project or portions of the Project with moneys ("Project Funds") provided by the State of California, acting by and through the State Water Resources Control Board (State Water Board); and WHEREAS, the State Water Board may fund the Project Funds with proceeds from the sale of obligations the interest upon which is excluded from gross income for federal income tax purposes (the "Obligations"), and WHEREAS, prior to either the issuance of the Obligations or the approval by the State Water Board of the Project Funds the Agency desires to incur certain capital expenditures (the "Expenditures") with respect to the Project from available moneys of the Agency; and WHEREAS, the Agency has determined that those moneys to be advanced on and after the date hereof to pay the Expenditures are available only for a temporary period and it is necessary to reimburse the Agency for the Expenditures from the proceeds of the Obligations. NOW, THEREFORE, BE IT RESOLVED BY THE ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE 7 BOARD OF DIRECTORS, that; 1. The Agency hereby states its intention and reasonably expects to reimburse Expenditures paid prior to the issuance of the Obligations or the approval by the State Water Board of the Project Funds. 2. The reasonably expected maximum principal amount of the Project Funds is $11.5 million. 3. This resolution is being adopted no later than sixty (60) days after the date on which the Agency will expend moneys for the construction portion of the Project costs to be reimbursed with Project Funds.

58 4. Each Agency expenditure will be of a type properly chargeable to a capital account under general federal income tax principles. 5. To the best of our knowledge, this Agency is not aware of the previous adoption of official intents by the Agency that have been made as a matter of course for the purpose of reimbursing expenditures and for which tax-exempt obligations have not been issued. 6. This resolution is adopted as official intent of the Agency in order to comply with Treasury Regulation and any other regulations of the Internal Revenue Service relating to the qualification for reimbursement of Project costs. 7. All the recitals in this Resolution are true and correct and this Agency so finds, determines and represents. ADOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation Agency on April 19, By President, Board of Directors

59 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATIVE SERVICES CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO: 8a SUBJECT: Employee of the Month SUMMARY: The Employee Recognition Program Nomination Committee met in March and reviewed the nominations received. The committee selected a candidate who was then recommended to Management for approval and there was a subsequent announcement of the selection to all Agency employees. Steve Ellis in the Facilities Engineering Section has been chosen as February 2017 Employee of the Month. Steve joined Zone 7 in September 1991 as a Junior Engineer and was subsequently promoted to Assistant Engineer in 1992 and to Associate Engineer in Currently he is the facility engineer of the Mocho Groundwater Demineralization Plant (MGDP) and his section heavily depends on him to help resolve issues at MGDP. Steve was commended by Lou Carella, Executive Vice President of Carollo Engineers, Inc., through an external nomination due to his involvement and time spent providing water education to some students from Antioch High School. The group learned of Zone 7 through a Carollo Cares program and the students took an interest in a project that the City of Antioch is undertaking which is planning of a brackish desalination facility at the Delta River location. They were interested in seeing a similar facility, and Steve organized and provided a tour of the MGDP. As described, Steve was gracious to provide the students with his time and knowledge of the plant, walking them through the engineering and operations. Steve also provided the students with a brochure of the facility which explained what they had just seen. In addition to the above, Steve was commended for taking on a large part of real property duties upon the retirement of another employee. He also put forth extra effort to get a $3 million drought emergency grant which was awarded to Zone 7 for the Chain of Lakes Well No. 5 Project and the Cope Lake Lake I Pipeline Project. Steve exhibits tremendous patience, diligence, and attention to detail. The selection committee supported the recommendation, thanking Steve for his attention to detail, diligence in follow through on his assignments and his willingness to share his knowledge and time educating students about our industry, with management approving the selection. RECOMMENDED ACTION: Staff recommend that the Zone 7 Board of Directors recognize and congratulate Steve Ellis as February 2017 Employee of the Month.

60 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATIVE SERVICES CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO: 8b SUBJECT: Staffing Update: Congratulations to Retiree SUMMARY: Continuing our practice of advising the Board of Directors on staffing changes, we are recognizing the name and service time for the following employee who has retired from Agency service. Retirement of Caroline Abram, Water Plant Operator III We would like to recognize Caroline Abram, Water Plant Operator III who retired from the Agency on March 25, after over 11 years of service. Caroline joined Zone 7 in May 2005 as a Water Plant Operator I with her Grade 2 treatment and distribution operator licenses. She was promoted to Water Plant Operator II and III in 2006 and 2007 respectively, and received her Grade 3 treatment operator license in July Caroline worked primarily at the Del Valle Water Treatment Plant and proved to be a very careful, thorough, and conscientious operator. We hope you will join us in wishing the best to Caroline in her retirement. RECOMMENDED ACTION: Adopt the attached resolution.

61 WHEREAS, Caroline Abram served the citizens of the Livermore-Amador Valley since beginning her employment with Zone 7 Water Agency in May 2005; and WHEREAS, Ms. Abram has had many important accomplishments while employed with Zone 7, including: Combined her varied background prior to working at the Agency plus her interest in the water industry, taking ownership of her duties and proving to be a very conscientious and competent water plant operator; Brought forth numerous ideas which she successfully put into action to make operations run more smoothly, such as creating a windsock at the carbon feed stations in order to asses wind direction and mitigate the potential for loose carbon material getting blown in an undesirable location; Provided a well-received, interactive and informative plant tour for participants in one of the Agency s annual Take Our Children To Work events; Applied excellent communication skills, especially when passing on critical information to co-workers; Consistently demonstrated her selfless nature in putting others ahead of herself to make work more efficient for all involved; Was named employee of the month in November 2014 for being a hard worker, always striving to improve processes in Operations; Performed her duties in a professional manner and was considerate to others, and inspired those who worked with her to do the same; and WHEREAS, Ms. Abram retired from Zone 7 service effective March 25, 2017; NOW, THEREFORE, BE IT RESOLVED that this Board does hereby acknowledge, commend, and thank Ms. Abram for her fine public service to Zone 7 Water Agency and the people of the Livermore-Amador Valley. I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, By President, Board of Directors

62 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATIVE SERVICES CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO: 8c SUBJECT: Staffing Update: Congratulations to Retiree SUMMARY: Continuing our practice of advising the Board of Directors on staffing changes, we are recognizing the name and service time for the following employee who has retired from Agency service. Retirement of Larry Akinsiku, Assistant Engineer We would like to recognize Larry Akinsiku, Assistant Engineer who retired from the Agency on March 25, after over 27 years of service. Larry started with Zone 7 in September 1989 as a Junior Engineer with a Bachelor s Degree in Civil Engineering from Alabama A&M University. In October of 1991, he was promoted to Assistant Engineer. As a member of the Flood Control team, Larry was very customer service-oriented, addressing citizen concerns responsibly and responsively. Larry was frequently complimented for how courteous he was to members of the public. We hope you will join us in wishing the best to Larry in his retirement. RECOMMENDED ACTION: Adopt the attached resolution.

63 WHEREAS, Larry Akinsiku served the citizens of the Livermore-Amador Valley since beginning his employment with Zone 7 Water Agency in September 1989; and WHEREAS, Mr. Akinsiku has had many important accomplishments while employed with Zone 7, including: Scheduling necessary facility repair projects with various Agency contractors; Managing the Agency s encroachment permit program; Inspecting Agency flood control facilities to meet requirements of the US Army Corps of Engineer assistance program; Responding to flood control-related complaints and issues from Tri-Valley residents in a courteous and responsible manner; Preparing notices and coordinating with police department personnel on homeless encampment cleanup efforts; and WHEREAS, Mr. Akinsiku retired from Zone 7 service effective March 25, 2017; NOW, THEREFORE, BE IT RESOLVED that this Board does hereby acknowledge, commend, and thank Mr. Akinsiku for his fine public service to Zone 7 Water Agency and the people of the Livermore-Amador Valley. I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, By President, Board of Directors

64 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATIVE SERVICES CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO: 8d SUBJECT: Staffing Update: Congratulations to Retiree SUMMARY: Continuing our practice of advising the Board of Directors on staffing changes, we are recognizing the name and service time for the following employee who has retired from Agency service. Retirement of Keith Braaten, Water Plant Operator III We would like to recognize Keith Braaten, Water Plant Operator who retired from the Agency on April 1, after over 26 years of service. Keith joined Zone 7 in May 1990 as a Water Plant Operator II with his Grade 2 treatment operator license. He received his Grade 3 treatment operator license in April 1991 and was promoted in June 1991 to Water Plant Operator III. In December 1994 he received his Grade 4 treatment operator license. Keith spent much of his career at our Del Valle Water Treatment Plant, often on the swing shift. He was always willing to take on the tough jobs and could be counted on to be reliable and punctual, frequently filling in when another operator was absent. We hope you will join us in wishing the best to Keith in his retirement. RECOMMENDED ACTION: Adopt the attached resolution.

65 WHEREAS, Keith Braaten served the citizens of the Livermore-Amador Valley since beginning his employment with Zone 7 Water Agency in May 1990; and WHEREAS, Mr. Braaten has had many important accomplishments while employed with Zone 7, including: Successfully performed swing shift duties at the Del Valle Water Treatment Plant for many years, readily sharing his depth of experience with all Zone 7 operations staff; Maintained a consistent practice of arriving to his shift on time in order to avoid interruptions in plant operations; Utilized excellent troubleshooting skills in the face of any operational challenges at the plant, proving to be very conscientious in his approach to problem-solving and assuring a safe drinking water, protective of public health; Exerted a positive influence on his co-workers and served as a true role model to those around him; Was named Employee of the Month in August 2015 for being both a positive influence and an experienced resource to Zone 7 operations staff; Overall was reliable, considerate and an energetic and helpful contributor where needed; and WHEREAS, Mr. Braaten retired from Zone 7 service effective April 1, 2017; NOW, THEREFORE, BE IT RESOLVED that this Board does hereby acknowledge, commend, and thank Mr. Braaten for his fine public service to Zone 7 Water Agency and the people of the Livermore-Amador Valley. I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, By President, Board of Directors

66 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATIVE SERVICES CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO: 8e SUBJECT: Staffing Update: Congratulations to Retiree SUMMARY: Continuing our practice of advising the Board of Directors on staffing changes, we are recognizing the name and service time for the following employee who has retired from Agency service. Retirement of Gerald De Witt, Maintenance Manager We would like to recognize Gerald De Witt, Maintenance Manager who retired from the Agency on April 1, after over 29 years of service. Gerald joined Zone 7 as a Water Plant Operator in September 1987, after holding similar jobs at San Jose Water and the City of Redding. Soon after joining Zone 7, he became a Water Plant Supervisor, initially out in the wellfields, then at Patterson Pass and Del Valle Water Treatment Plants. He was a training supervisor in water treatment and safety for a time and, in 1993, he went to Maintenance as supervisor. In January 2007 he returned to operations overseeing the Distribution & Wellfield section. In 2008 he returned to Maintenance and in November 2010 he was promoted to Maintenance Manager, overseeing all Agency maintenance activities. Gerald holds his Grade 5 operator certifications in both treatment and distribution from the State of California. Whether in operations or maintenance, Gerald approached every job with passion and commitment, constantly looking for ways to improve the way things work. We hope you will join us in wishing the best to Gerald in his retirement. RECOMMENDED ACTION: Adopt the attached resolution.

67 WHEREAS, Gerald De Witt served the citizens of the Livermore-Amador Valley since beginning his employment with Zone 7 Water Agency in September 1987; and WHEREAS, Mr. De Witt has had many important accomplishments while employed with Zone 7, including: Oversaw and performed many difficult and important repairs in the Agency s distribution system; Constantly looked for ways to improve the operation and effectiveness of the Maintenance Section, including expanding the capabilities of the section and finding better ways to operate and maintain Agency systems; Utilized his vast industry experience to come up with practical and sound solutions to problems or necessary repairs; Helped transition the Maintenance Section from a primarily contract-based workforce to utilizing mostly in-house labor; Contributed as a key resource for updating the Hazardous Materials Business Plans (HMBPs) in preparation for regulatory inspections at the applicable facilities; Contributed significantly to the installation of the Kitty Hawk pump station; Updated the Agency s fleet for sludge operations at the treatment plant; Overall was a great resource and help across the Agency; and WHEREAS, Mr. De Witt retired from Zone 7 service effective April 1, 2017; NOW, THEREFORE, BE IT RESOLVED that this Board does hereby acknowledge, commend, and thank Mr. De Witt for his fine public service to Zone 7 Water Agency and the people of the Livermore-Amador Valley. I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, By President, Board of Directors

68 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATIVE SERVICES CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO: 8f SUBJECT: Staffing Update: Congratulations to Retiree SUMMARY: Continuing our practice of advising the Board of Directors on staffing changes, we are recognizing the name and service time for the following employee who has retired from Agency service. Retirement of Diana Gaines, Senior Engineer We would like to recognize Diana Gaines, Senior Engineer, who retired from the Agency on March 23 after over 26 years of service. Diana was a true jack of all trades in that she served the Agency under many various capacities during her tenure. Diana started her career with three years at Alameda County Public Works as an engineer. She then took a position with a local engineering consultant firm and in September 1993 she came to Zone 7 in the Associate Civil Engineer position. She worked primarily in Flood Control, serving several acting principal roles during her time there. Diana was then promoted to Senior Engineer in 1999 and served as the Agency s Emergency and Safety Program Manager. She has also worked in the Water Supply Engineering and Integrated Planning sections, and coordinated the Agency s security program. In 2014 she rejoined the Flood Control group where she finished her career. We hope you will join us in wishing the best to Diana in her retirement. RECOMMENDED ACTION: Adopt the attached resolution.

69 WHEREAS, Diana Gaines served the citizens of the Livermore-Amador Valley since beginning her employment with Zone 7 Water Agency in September 1993; and WHEREAS, Ms. Gaines has had many important accomplishments while employed with Zone 7, including: Developing a Flood Warning System for Flood Control which included research for climatologists and weather forecasters and a guideline for responses to large precipitation events; Reviewing design elements for improvements impacting flood control channels including hydraulic modeling and plan layout, researching methodologies and programs and meeting with stakeholders; Designing and overseeing installation of stream gauge stations and cameras and assisting with interface between USGS and Zone 7 on sedimentation and stream gaging; Monitoring stream gauges and rain gauges for high flows during the rainy season and helping prepare needed supplies for flood control facilities and inspections; Assisting with applications for financial assistance from federal and state agencies for storm-related damages or other disasters affecting the Agency; Developing and managing the Agency s Local Hazard Mitigation Plan (LHMP) and Emergency Operations Plan (EOP); Monitoring and upgrading the Agency s security systems at all Agency facilities; Was named Employee of the Month in December 2016 for her service and dedication to the Agency in various capacities over the years; and WHEREAS, Ms. Gaines retired from Zone 7 service effective March 23, 2017; NOW, THEREFORE, BE IT RESOLVED that this Board does hereby acknowledge, commend, and thank Ms. Gaines for her fine public service to Zone 7 Water Agency and the people of the Livermore-Amador Valley. I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, By President, Board of Directors

70

71 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATIVE SERVICES CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO: 8g SUBJECT: Staffing Update: Congratulations to Retiree SUMMARY: Continuing our practice of advising the Board of Directors on staffing changes, we are recognizing the name and service time for the following employee who has retired from Agency service. Retirement of Wyman Hong, Water Resources Technician II We would like to recognize Wyman Hong, Water Resources Technician II who retired from the Agency on March 25, after over 35 years of service. Wyman joined Zone 7 as a Civil Engineer Trainee in July 1981 and was promoted to Water Resources Technician I and II in 1983 and 1984 respectively. He holds a B.S. degree in Biological Sciences from Humboldt State with a concentration in fishery studies. Over his career he logged many hours inspecting and monitoring wells, taking water samples, drafting maps, and talking to permit applicants. His assignments in the Groundwater section included issuing approximately 150 to 200 well permits per year. Wyman was very customer service oriented and was considered to be the official photographer at Zone 7 functions. We hope you will join us in wishing the best to Wyman in his retirement. RECOMMENDED ACTION: Adopt the attached resolution.

72 WHEREAS, Wyman Hong served the citizens of the Livermore-Amador Valley since beginning his employment with Zone 7 Water Agency in July 1981; and WHEREAS, Mr. Hong has had many important accomplishments while employed with Zone 7, including: Worked as a valuable team member of the Groundwater Section for over 35 years; Insured protection of local groundwater quality through enforcement of the Alameda County Water Wells Ordinance and California Well Standards, and through careful permit compliance inspections; Processed over 6,000 water well and soil boring drilling permits; Maintained Zone 7 and Department of Water Resources (DWR) well records by reviewing countless well completion reports, assigning official State well numbers to each, and transmitting them to the DWR for filing; Conducted numerous well searches both in the field and using Zone 7 s database; Implemented Zone 7 s first well permit fee program; Coordinated Zone 7 s well permit activities with adjacent jurisdictions including helping Alameda County Public Works set up their drilling permit program; Provided exemplary customer service to permittees, outside agencies, internal staff and the public; and WHEREAS, Mr. Hong retired from Zone 7 service effective March 25, 2017; NOW, THEREFORE, BE IT RESOLVED that this Board does hereby acknowledge, commend, and thank Mr. Hong for his fine public service to Zone 7 Water Agency and the people of the Livermore-Amador Valley. I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, By President, Board of Directors

73 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATIVE SERVICES CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO: 8h SUBJECT: Staffing Update: Congratulations to Retiree SUMMARY: Continuing our practice of advising the Board of Directors on staffing changes, we are recognizing the name and service time for the following employee who has retired from Agency service. Retirement of Kevin Hulme, Plant Maintenance Laborer We would like to recognize Kevin Hulme, Plant Maintenance Laborer who retired from the Agency on April 1, after over 26 years of service. Kevin started with Zone 7 in July 1990 as a Plant Maintenance Laborer in the Maintenance Section at Del Valle Water Treatment Plant. Prior to his time with Zone 7, Kevin served in the United States Army and worked in construction, maintenance, and plumbing. In his capacity as Plant Maintenance Laborer Kevin performed many duties for the benefit of the Maintenance Section, for Zone 7 and for the public. Over the years Kevin has generously donated his time, culinary expertise and food for many Zone 7 employee events. We hope you will join us in wishing the best to Kevin in his retirement. RECOMMENDED ACTION: Adopt the attached resolution.

74 WHEREAS, Kevin Hulme served the citizens of the Livermore-Amador Valley since beginning his employment with Zone 7 Water Agency in July 1990; and WHEREAS, Mr. Hulme has had many important accomplishments while employed with Zone 7, including: Performed a variety of handyman duties and building repairs including plumbing, painting, welding, carpentry and modifications of employee workspaces; Participated in pipeline and equipment repairs when required, often working to assist other trades when extra help was necessary on a job; Performed work that was often not visible to the public, including running the Bobcat tractor and auger to turn plant sludge beds to promote drying which enabled the treatment plants to run at capacity before there were centrifuges on site; Completed the annual spring mowing at the Chain of Lakes property in order to reduce the risk of fire in the tall dry grass of summer; Amassed a body of knowledge of Zone 7 facilities and equipment that made him a valuable resource and reference for everyone in the Maintenance Department; Was named Employee of the Month in September 2012 for his contribution to the many, often unglamorous, tasks that allow Zone 7 staff to perform work more effectively; Made Zone 7 a better place to work by spearheading employee appreciation events such as the PitMaster BBQ Contest and donating time and effort to assuring success of employee social events such as the Summer Pool Party/Potluck; and WHEREAS, Mr. Hulme retired from Zone 7 service effective April 1, 2017; NOW, THEREFORE, BE IT RESOLVED that this Board does hereby acknowledge, commend, and thank Mr. Hulme for his fine public service to Zone 7 Water Agency and the people of the Livermore-Amador Valley. I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, By President, Board of Directors

75 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: INTEGRATED PLANNING CONTACT: Amparo Flores AGENDA DATE: April 19, 2017 ITEM NO. 9 SUBJECT: Lake Del Valle Storage Expansion Study SUMMARY: The Water Supply Evaluation Update (2016) underscored the need for Zone 7 Water Agency (Zone 7) to continue to pursue water supply options to enhance storage flexibility and improve long-term water supply reliability for the Livermore-Amador Valley. The Lake Del Valle Storage Expansion Study is one of the options evaluated by Zone 7. Since September 2016, Zone 7, Alameda County Water District (ACWD) and Santa Clara Valley Water District (SCVWD), in collaboration with East Bay Regional Parks District (EBRPD) have been evaluating the feasibility of increasing storage capacity in Lake Del Valle; options studied by the consultant include the reallocation of flood storage to water supply storage and the modification of EBRPD facilities to accommodate higher or lower operating levels; cost for the studies to date have cost Zone 7, ACWD, and SCVWD a total of $225,000. Given the grant funding opportunity under Proposition 1 for storage projects under the Water Storage Investment Program (WSIP), the partners discussed next steps for this effort and sought proposals from consultants to prepare a Prop 1 application and estimates range from about $260,000 to $900,000. Staff does not support reallocating flood storage to water supply storage because of ownership issues, flood impacts, water rights impacts, and investments in other more beneficial storage options. Staff met with the Water Resources Committee on April 11, The Committee unanimously recommended no further expenditures to seek WSIP funding for Lake Del Valle Storage Expansion but to bring the issue before the Board for confirmation. On April 11 th, the ACWD Board met and determined that they were not going to participate in funding a WSIP application. Staff recommends not pursuing WSIP funding for the Lake Del Valle Storage Expansion. FUNDING: Up to $900,000 This would require an appropriation in Funds 100 and 130, as this money is not in the current budget. RECOMMENDED ACTION: Consider adopting the attached resolution. ATTACHMENTS: Memorandum and Resolution 1

76 INTEROFFICE MEMORANDUM DATE: April 19, 2017 TO: Jill Duerig, General Manager FROM: Amparo Flores, Integrated Planning Manager SUBJECT: Lake Del Valle Storage Expansion BACKGROUND: The Water Supply Evaluation Update (2016) underscored the need for Zone 7 Water Agency (Zone 7) to continue to pursue water supply options to enhance storage flexibility and improve long-term water supply reliability for the Livermore-Amador Valley. The Lake Del Valle Storage Expansion Study is one of the options being evaluated by Zone 7. Lake Del Valle Reservoir, owned and operated by the Department of Water Resources (DWR) as part of the State Water Project (SWP), is an off-stream storage facility for the South Bay Aqueduct (SBA) that provides regulatory storage for the SBA, flood control for Alameda Creek, capture of local water from Arroyo del Valle, and recreation. Lake Del Valle has a total capacity of 77,000 acre-feet, with about 40,000 acre-feet generally reserved for water supply storage and the remainder reserved for flood management. Recreation facilities include a boat ramp, campgrounds, and beaches, all operated by EBRPD through an agreement with DWR. Lake Del Valle is also invaluable as a source of blending water when Delta water quality is impaired. Figure 1 below shows the storage in Lake Del Valle allocated to different uses. Figure 2 shows the key facilities in and around Lake Del Valle relative to elevation and storage. Figure 1. Storage in Lake Del Valle 2

77 Figure 2. Key Facilities in and around Lake Del Valle DISCUSSION: Since September 2016, Zone 7, Alameda County Water District (ACWD), and Santa Clara Valley Water District (SCVWD), in conjunction with East Bay Regional Parks District (EBRPD) ( Partners ) have been evaluating the feasibility of increasing storage capacity in Lake Del Valle through: (a) optimized reservoir operation (Forecast Informed Reservoir Operation [FIRO]1), b) reallocation of flood storage to water supply storage, (c) physical modification to the dam, and d) modification of EBRPD facilities to increase operational storage. The evaluation is considering impacts including, but not limited to: water supply yield; EBRPD facilities (e.g., wastewater infrastructure) and operations; SWP operations; and flood management. Consulting services are estimated to cost up to $225,000, with costs being shared equally among the three water agencies. It is anticipated that all of these funds will be expended. The Board approved participation in this project at $75,000 (Zone 7 s share) in September Given the grant funding opportunity under Proposition 1 (Water Quality, Supply, and Infrastructure Improvement Act of 2014), with $2.7 billion available for storage projects under the Water Storage Investment Program (WSIP), there is discussion among the partners on next steps for this effort. The grant application process is rigorous and applications are due on August 14, 2017; therefore, a decision is required imminently on whether to pursue grant funding. 1 FIRO is a reservoir operations scheme in which weather forecasts are integrated into the decision-making process for water releases from reservoirs, rather than the traditional method of using a prescribed drawdown schedule for flood management. 3

78 The following provides a status update on the study components, more information regarding the grant application process, and a summary of recommendations from the Water Resources Committee. Lake Del Valle Storage Expansion Study Table 1 provides a summary of the components of the study. The first three components are included in the $225,000 estimate for consulting services. Table 1. Summary of Components of the Lake Del Valle Storage Expansion Study Component Work Done By Status FIRO and Storage Reallocation Study Assessment of the value of the recreational facilities at Lake Del Valle Preliminary engineering study to modify or relocate recreation facilities affected if lake operational level is lowered Evaluation of the potential impacts to local water rights. Evaluation of the potential impacts to water quality during impaired Delta conditions. David Ford Consulting VFA, Inc. KSN Engineers Staff Staff Internal draft report under staff review To be completed by late April 2017 Draft technical memo completed To be completed by mid-may 2017 To be completed by late April 2017 Preliminary results are available from the work of David Ford Consulting and KSN, and these are presented below. FIRO and Storage Reallocation Study David Ford Consulting Engineers has completed an internal draft report for the FIRO and Storage Reallocation Study. The analysis is based on historical hydrology between November 1969 to September 2015 and includes up to a 25-year storm event and a modeled maximum lake inflow of 8,200 cfs (note that a 100-yr event is estimated to be much higher at 18,700 cfs). The study also uses current water supply operational patterns and USACE Water Control Manual flood operation rules. The alternatives evaluated include: 1) FIRO, 2) FIRO and 5,000 to 25,500 AF of flood storage reallocated to water supply (i.e., flood storage decreases from 37,000 AF to 11,500-32,000 AF), and 3) FIRO and structural modification to add 5,000 AF of additional water storage space. The metrics evaluate water supply availability (e.g., storage levels in the lake), flood management (e.g., maximum downstream flows), recreational facility impacts (e.g., reservoir elevations) for the different scenarios. The FIRO and Storage Reallocation Study finds that storage reallocation or structural modification alternatives have the potential to enhance water supply storage, but will require relocation of EBRPD facilities to avoid recreational impacts. Based on the modeled period, flood management may be largely unaffected compared to baseline operations 99% of the time; 4

79 however, storage reallocation increases the frequency and magnitude of high flood release rates from the reservoir (>2,000 cfs). Because this study focuses largely on water supply, the extent of impacts to flood management will need to be further evaluated. The recent storm events indicate that significant damage from erosion downstream could occur even when Lake Del Valle is being operated consistent with the USACE Water Control Manual; for example, after the 1,200 cfs release from the lake in March 2017, four bank slides occurred and hundreds of trees were felled. Based on the results of the study and the following concerns, staff does not support reallocating flood storage to water supply storage: The water agencies do not own nor operate the lake. The recent flood events illustrate the need for substantial flood storage in Lake Del Valle; therefore, it does not make sense to reduce that storage and convert it to water supply storage. Making substantial changes to Lake Del Valle s operations could negatively affect Zone 7 s (and ACWD s) existing water rights. Zone 7 is currently expending significant resources to evaluate other storage options (Sites Reservoir and Los Vaqueros Expansion) that have a much higher potential benefit. Modification of EBRPD Facilities Affected by Lower Lake Levels KSN Engineers has completed a draft preliminary engineering study to modify or relocate recreation facilities that can become unavailable when lake levels are drawn down below the current minimum, which is another way of increasing the available operational storage for water supply. A draft technical memorandum from KSN is currently under review. As indicated on Figure 2, water supply operational storage is currently limited to 15,000 AF (from 680 to 703 ) because of the locations of the EBRPD water supply intake and other facilities. The KSN study evaluated modification of these facilities to allow the water level (i.e., Bottom of Conservation Pool) to drop to 675 and 650, making up to 11,000 AF of deadpool available (total operational storage increased up to 26,000 AF). The estimated capital costs range from $3 to $10.5M. Staff believes lowering the lake s operational level is feasible; however, this would require coordination with and concurrence from DWR and EBRPD. This may enhance the capture of local water but may have water quality impacts. WSIP Grant Application As mentioned above, Proposition 1 (Water Quality, Supply, and Infrastructure Improvement Act of 2014) made $2.7 billion available for storage projects under the Water Storage Investment Program (WSIP). The grant application process is rigorous and applications are due on August 14, The basic application requirements are as follows: Project description Explanation of eligibility Funding requested, project cost, and cost-allocation Estimated project schedule until the initial year of operation Explanation that project does not adversely affect any protected river 5

80 Verification from DWR that the agencies are in compliance with requirements of Water Code Identification of affected groundwater basins and GSP integration Explanation of how the project improves the operations of the state water system Summary of local, regional, or state water supply reliability or operational improvements provided by the project Summary of coordination with the owners and operators of water systems not owned or operated by the agencies Discussion of regulatory compliance requirements Description and assumptions of the with-project and without-project future conditions for the years 2030 and 2070 Consultant estimates for completing the WSIP application range from $260 to 900K (assuming all three water agencies participate, Zone 7 s share would be $90K-300K). The process is very competitive with more established and larger projects, such as Sites Reservoir and Los Vaqueros Expansion, seeking funding. Note that Zone 7 is investing in those two projects, which are more competitive as designs and CEQA are complete. On April 11, 2017, ACWD s Board opted not to participate in funding the preparation of a WSIP grant application for the Lake Del Valle Storage Expansion, although they voted to continue to look at options that would allow the lowering of the lake s levels. Recommendations from the Water Resources Committee Staff met with the Water Resources Committee on April 11, The Committee unanimously recommended not to pursue WSIP funding for Lake Del Valle Storage Expansion and to bring the issue before the Board; however, the committee did recommend continued discussions with DWR and EBRPD in case future grant opportunties may arise. STAFF RECOMMENDATIONS: Staff recommends discussing the possible preparation of a WSIP grant application package, which could cost Zone 7 up to $900,000, if no funding partners are identified, and the appropriation of unbudgeted reserve funds. Note that staff recommends against this course of action but has prepared a resolution should the Board choose to pursue. Note also that the Water Resources Committee unanimously opposes pursuing WSIP funding at this time. 6

81 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT BOARD OF DIRECTORS INTRODUCED BY SECONDED BY RESOLUTION NO. LAKE DEL VALLE STORAGE EXPANSION WHEREAS, Zone 7 of Alameda County Flood Control and Water Conservation District (Zone 7) continues to pursue water supply options to enhance storage flexibility and improve long-term water supply reliability for the Livermore-Amador Valley and the Lake Del Valle Storage Expansion Study is one of such options being evaluated by Zone 7; and WHEREAS, there is a grant funding opportunity under Proposition 1 for storage projects under the Water Storage Investment Program (WSIP); and WHEREAS, consultant proposals to prepare a timely WSIP application range up to $900,000; and WHEREAS, funding for this is not in the current approved budget; NOW, THEREFORE, BE IT RESOLVED, that the Zone 7 Board of Directors does hereby authorize the General Manager to pursue WSIP funding for the Lake Del Valle Storage Expansion and to engage consultant support services up to, but not exceeding, $900,000; and BE IT FURTHER RESOLVED that the Zone 7 Board of Directors hereby appropriates $900,000 in the FY16/17 budget for this work from Funds 100 and 130. ADOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a Resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, By: President, Board of Directors 7

82 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATION CONTACT: Jill Duerig AGENDA DATE: April 19, 2017 ITEM NO. 10 SUBJECT: Award of Contract to Morrison & Associates, Inc., for Professional Services for Outreach Support, including the Schools Program SUMMARY: Zone 7 typically engages professional services for community outreach, water education and regional/local agency coordination. A key part of this program is to provide classroom presentations for K-12 students. For the past 17 years, Zone 7 has been offering Tri-Valley teachers a wide variety of free classroom programs to make learning about water fun and help teachers meet state and federal curriculum standards. Zone 7's schools program is available to classrooms in Livermore, Pleasanton, Dublin and the Dougherty Valley in San Ramon. For the school year, there were a total of 387 kindergarten-through-eighth grade classroom presentations and 56 high school presentations. The program reached more than 12,000 students with presentations at every grade level. Topics ranged from watershed and creek protection to flood protection, drinking water quality, and water conservation. In January of this year, Zone 7 issued a new Request for Proposals for these and other local outreach services. RFPs were sent to 30 consulting firms and the RFP was posted on the Zone 7 website. Of the two responses received, a rating panel selected Morrison & Associates, Inc., as the best qualified to provide these services. Staff recommends authorizing a contract with Morrison & Associates, Inc., covering a threeyear period, from July 1, 2017 through June 30, 2020, with the potential for up to two one-year extensions at Zone 7 s discretion. The three-year contract would help Zone 7 project and manage costs. Including allowable reimbursable expenses, the maximum annual compensation under the initial three-year contract would be $240,000, which includes a 10% contingency. The General Manager would be authorized to negotiate and execute up to two optional one-year extensions upon mutually-agreeable terms not to exceed $250,000 per year. FUNDING: Funding for this contract is available from Fund 100, Water Enterprise and Fund 200, Flood Control. RECOMMENDED ACTION: Adopt attached resolution. ATTACHMENTS: Memo with Additional Detail Resolution

83 Interoffice Memo Date: April 19, 2017 To: Directors From: Jill Duerig Subject: Award of Contract to Morrison & Associates, Inc., for Professional Services for Outreach Support, including the Schools Program The following provides additional background and discussion on the above-referenced agenda item: BACKGROUND: Zone 7 s public outreach program is enhanced by a consultant contract for community outreach, water education and regional/local agency coordination support services. This contract aims to leverage subject matter expertise in water issues, water science, knowledge of the local community, and strategic communications in support of Zone 7 programs and projects. In January of this year, staff issued a new Request for Proposals for Community Outreach, Water Education and Regional/Local Agency Coordination Support Services, sending to thirty consulting firms. Two written proposals were received from: Morrison & Associates, Inc. The Stone Group After reviewing the two written proposals, a rating team comprised of Zone 7 staff representatives selected Morrison & Associates, Inc., as the best qualified to provide the needed professional services support for the outreach program. DISCUSSION: In FY 2015/16, Morrison & Associates (M&A) accomplished the following: Schools Program (K-12): This year s Zone 7 Schools Program was again highly successful. Although the numbers are not yet available for the school year, for the school year, there were a total of 387 kindergarten-through-eighth grade classroom presentations and 56 high school presentations. The program reached more than 12,000 students with presentations at every grade level. Topics ranged from watershed and creek protection to flood protection, drinking water quality, and water conservation. Again, in the school year, high school offerings were extended to a newly developed Water Around the World lesson aimed at Advanced Placement environmental science classes or the nearest equivalent classes in schools that don t offer AP environmental science. This lesson was in addition to the high school program s Water: Choice and Changes presentation offered to ninth-grade health classes which was begun in Community Outreach: Historically, M&A has also supported agency participation in the Earth Day Festival in Pleasanton, Dublin Pride Week, Valley Children s Museum promotional activities, two Home & Garden Shows at the Alameda County Fairgrounds, the Sunol Spring

84 Wildflower Festival and other community events. It assisted with outreach on Coastal Cleanup events in Pleasanton and Dublin, and during the month of May will be providing focused messaging at events and in the schools to mark Water Awareness Month. Helped staff the Clean Water Program booth at last year s Alameda County Fair and worked with public affairs staff in developing new materials promoting stormwater pollution prevention. M&A provided a workshop about water-wise plants at a local nursery; continued to develop, in consultation with Zone 7 staff, new materials for promoting water conservation at local nurseries; and refined conservation giveaways. Through government relations work, helped Zone 7 attract grant funding. Planned tasks within the scope of the proposed contract include: Schools Program (K 12): Develop and deliver classroom presentations and science day/fair displays and booths covering topics ranging from watershed and creek protection to storm drain protection, water quality and water conservation. Initial estimate: $128,000. Community Outreach: Plan, coordinate and execute special events, such as annual Earth Day events, participate in other local community events, including Home and Garden Shows, creek walks and cleanups. Initial estimate: $50,000. Regional/Local Agency Coordination Support Services: On an as-needed basis, assist Zone 7 management in its communications and liaison efforts with such regional coalitions, as the Bay Area Integrated Regional Water Management Plan flood agency functional area (Bay Area Flood Protection Agencies Association). It may involve evaluating Zone 7 s water flood protection projects, assisting in grant application preparation and seeking funding from appropriate bond initiatives, such as Propositions 84 and 1E or other grant monies available for Zone 7 projects. Initial estimate: $30,000. Clean Water Program: On an as-needed basis, support Zone 7 staff in responding to public outreach requirements and other administrative requirements of the Alameda Countywide Clean Water Permit (ACCWP). Initial estimate: $11,000. RECOMMENDATION: Staff proposes authorizing the General Manager to negotiate and execute a three-year contract with Morrison & Associates, Inc., covering the period from July 1, 2017 through June 30, 2020, with the potential for up to two one-year extensions at Zone 7 s discretion. The threeyear contract would help Zone 7 project and manage costs. Including allowable reimbursable expenses, the maximum annual compensation under the initial three-year contract would be $240,000, which includes a 10% contingency. The General Manager would also be authorized to negotiate and execute up to two additional one-year extensions upon mutually-agreeable terms not to exceed $250,000 per year.

85 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT INTRODUCED BY SECONDED BY BOARD OF DIRECTORS RESOLUTION NO Authorizing a Contract with Morrison and Associates, Inc., to Provide Professional Services for Outreach Support, Including the Schools Program WHEREAS, professional services for Zone 7 are needed to assist staff in providing community outreach, water education such as the schools program and local/regional agency coordination for the period from July 1, 2017 through June 30, 2020; and WHEREAS, following a request for proposals and a review of the three proposals received, Morrison & Associates, Inc., was deemed the most qualified firm to provide such professional support services; NOW, THEREFORE, BE IT RESOLVED that the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District does hereby authorize the General Manager to negotiate and execute a professional services contract with Morrison & Associates, Inc., for the period from July 1, 2017 through June 30, 2020 in an annual amount not to exceed $240,000 which includes a 10% contingency; BE IT FURTHER RESOLVED that the Board of Directors authorize the General Manager to negotiate and execute up to two additional one-year extensions to that contract in annual amounts not to exceed $250,000. ADOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a resolution adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, 2017 By President, Board of Directors

86 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: INTEGRATED WATER RESOURCES SECTION CONTACT: Carol Mahoney AGENDA DATE: April 19, 2017 ITEM NO. 11 SUBJECT: First Reading of Proposed Sustainable Groundwater Management Ordinance SUMMARY: Zone 7 has actively managed the Livermore-Amador Valley Groundwater Basin since initiating artificial recharge with water imported from the State Water Project in In September 2005 the Zone 7 Board of Directors adopted a Groundwater Management Plan to document compliance of the ongoing program and policies with the California Groundwater Management Planning Act. Annual updates on the program are prepared and posted on the Agency s website. In the Sustainable Groundwater Management Act (SGMA) of 2014, Zone 7 was designated as the exclusive GSA for all groundwater basins within its service area. In December 2016, Zone 7 formally elected to accept this role and submitted an Alternative Groundwater Sustainability Plan (GSP) to the state. To further enhance Sustainable Management of the groundwater basin, general counsel and staff have prepared the attached draft ordinance for board consideration. This was discussed with the Water Resources Committee on April 11, 2017 and the Committee unanimously supported moving this forward to the full board for a first reading. Among the requirements for adoption of any Zone 7 ordinance, a full reading of the ordinance (i.e., first reading ) must be conducted at a Board meeting, or following the reading of its title, the Board may waive the full reading requirement by a majority vote. FUNDING: No funding is necessary for the Ordinance adoption. RECOMMENDED ACTIONS: After reading the title, take a vote to waive the full reading of the Ordinance, discuss as appropriate and direct staff to schedule the consideration of Ordinance adoption at the May 17, 2017, Board meeting. ATTACHMENTS: Draft Sustainable Groundwater Management Ordinance

87 DRAFT: April 12, ZONE 7 ORDINANCE NO. AN ORDINANCE SUPPORTING SUSTAINABLE GROUNDWATER MANAGEMENT THE BOARD OF DIRECTORS OF ZONE 7 OF THE ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT HEREBY ORDAINS AS FOLLOWS: Section 1. Short Title This ordinance may be cited as the Zone 7 Sustainable Groundwater Management Ordinance. Section 2. Purpose and Intent The Zone 7 Board of Directors hereby finds: A. The protection of the public health, welfare, and safety of the residents of the County require that the groundwater resources of Eastern Alameda County be protected from adverse impacts resulting from specific activities that constitute unsustainable groundwater extraction within the Zone 7 s service area and from the export of water outside of the Zone 7 s service area; and B. Groundwater is an essential resource for municipal, industrial and domestic uses within the area; and C. Groundwater is also an essential resource for continued agricultural production within the County, which production includes, but is not limited, to vineyards and which significantly contribute to the total agricultural production of the area as well as establishing the Tri-Valley area as an agricultural tourism destination, with the associated economic benefits; and D. The unsustainable extraction of groundwater resources within the service area and the export of water outside of the service area each could have significant adverse environmental impacts on Eastern Alameda County, including but not limited to increased groundwater overdraft, uncontrolled movement of inferior quality groundwater, the lowering of groundwater levels, and increased groundwater degradation; and E. The unsustainable extraction of groundwater resources within Eastern Alameda County and the export of water outside of the area each could have adverse economic impacts on the County, including but not limited to, loss of arable land, a decline in property values, increased pumping costs due to the lowering of groundwater levels, increased groundwater quality treatment costs, and replacement of wells due to declining groundwater levels, replacement of damaged wells, conveyance infrastructure, roads, bridges and other appurtenances, structures, or facilities due to land subsidence; and F. California Constitution, Article X, Section 2, as well as Water Code Section 100, requires that the water resources of the State of California be put to the greatest beneficial use of which they are capable and also prohibit the waste, unreasonable use, unreasonable Page 1 of 8

88 DRAFT: April 12, method of use, and unreasonable method of diversion of water. The Zone 7 Board of Directors finds that the unsustainable extraction of groundwater and the export of water outside of the service area are presumptively inconsistent with the California Constitution and the California Water Code. G. The Zone 7 Board of Directors further finds that, as noted in section (D) of the Alameda County Code, the indiscriminate pumping and discharge of groundwater in a wasteful manner is prohibited by the County. Under the Sustainable Groundwater Management Act, Zone 7 is obliged to ensure that groundwater within Zone 7 s boundaries is managed in a sustainable manner, which in the determination of the Board of Directors, prohibits the wasteful use of water, the unsustainable use of groundwater within a specific groundwater basin, or in light of the history of the aquifers within the boundaries of Zone 7, the export of groundwater to areas outside Alameda County without an equal replenishment of such groundwater. H. The Zone 7 Board of Directors further finds that, as noted in section (A) of the Alameda County Code, the prevention of [the] impedance of groundwater movement and water quality degradation is an undesirable result that is also prohibited by the Sustainable Groundwater Management Act. The Board of Directors finds and determines that preventing such adverse effects on the environment serves the public interest and enhances the water supply reliability for Zone 7 s service area. I. Nothing in this Ordinance determines or alters surface water rights or groundwater rights under common law or any provision of law that determines or grants surface water rights. The Board of Directors finds and determines that implementing provisions to prohibit the waste of water, the unsustainable use of groundwater, and the export of groundwater are actions that implement the mandates of the California Constitution, California statutes and the Alameda County Code. J. Zone 7 is authorized by the Alameda County Flood Control and Water Conservation District Act to take such actions as may be necessary to store water for use within the service area, to import water for use within the service area, and to prevent the wasteful use or export of water from the service area. The Zone 7 Board of Directors finds and determines that such prevention of waste and unreasonable use, such preservation of the water imported into the service area at great cost to the public, and the prevention of the export of water from the service area are all essential to assuring a reliable water supply to the residents and farms within the service area. K. Zone 7 is also authorized by the Alameda County Flood Control and Water Conservation Act to carry on investigations of all kinds, make measurements, collect data and make analyses and inspection pertaining to water supplies and water rights. The Zone 7 Board of Directors finds and determines that Zone 7 staff are authorized to request such information as may be necessary to determine whether a proposed use of water is consistent with this Ordinance. L. Zone 7 has elected to become a groundwater sustainability agency under the auspices of the Sustainable Groundwater Management Act and, under that act, is the Page 2 of 8

89 DRAFT: April 12, exclusive groundwater sustainability agency for the service area. Moreover, Zone 7 has submitted to the California Department of Water Resources an alternative plan for the management of groundwater within the service area. The Zone 7 Board of Directors finds and determines that exercising the full range of authority granted by the Sustainable Groundwater Management Act to groundwater sustainability agencies is necessary in order to achieve the purposes of this Ordinance, which are to assure that the groundwater resources of the service area are used in a manner that is sustainable for the long term and that the surface water resources that Zone 7 imports into the service area at great cost are not subject to unauthorized use. Section 3. Definitions The following words and phrases shall have the following meanings when used in this Ordinance: A. Board: The Board of Directors of Zone 7. B. De minimis extractor: A Person who extracts two (2) acre-feet or less per year. C. Eastern Alameda County: That portion of Alameda County that lies within Zone 7 s service area. D. Export of water: The act of conveying groundwater, or surface water for which groundwater has been substituted, out of the Zone 7 service area. E. General Manager: The General Manager of Zone 7 or his/her designee. F. Groundwater: Water that occurs beneath the surface of the earth within the zone below the water table in which the soil is completely saturated with water, but does not include water that flows in known and definite channels. G. Groundwater Sustainability Plan: a plan adopted pursuant to Water Code section et seq. H. Person: Includes natural persons, corporations, firms, partnerships, joint stock companies, associations and other organizations of persons, and public entities. I. Public water agency: Any local public agency that has authority to undertake water-related activities. J. Reasonable use: The use of water in a manner that is consistent with the requirements of Article X, section 2 of the California Constitution and/or Water Code section 100. K. Service Area: Zone 7 s service area Page 3 of 8

90 DRAFT: April 12, L. Sustainable groundwater management: The management and use of groundwater in a manner that can be maintained during the planning and implementation horizon as defined in subdivision (q) of Water Code section without causing or substantially contributing to undesirable results. M. Undesirable result: One or more of the following: 1. Chronic lowering of groundwater levels indicating a significant and unreasonable depletion of supply if continued over the planning and implementation horizon. Overdraft during a period of drought is not sufficient to establish a chronic lowering of groundwater levels if extractions and recharge are managed as necessary to ensure that reductions in groundwater levels or storage during a period of drought are offset by increases in groundwater levels or storage during other periods. 2. Significant and unreasonable reduction of groundwater storage. 3. Significant and unreasonable degraded water quality, including but not limited to the migration of contaminant plumes that impair water supplies. 4. Significant and unreasonable land subsidence that substantially interferes with surface land uses. 5. Surface water depletions that have significant and unreasonable adverse impacts on beneficial uses of the surface water. N. Unsustainable extraction of groundwater: The extraction of groundwater in a manner that is not sustainable groundwater management as defined in the Sustainable Groundwater Management Act, Water Code sections et seq. O. Waste and unreasonable use: The use of water in a manner that is prohibited by Article X, section 2 of the California Constitution and/or Water Code section 100. P. Zone 7 or Zone 7 Water Agency: Alameda County Flood Control and Water Conservation District, Zone 7. Section 4. Prohibitions Except as otherwise provided in this Ordinance, the following actions are prohibited: A. The unsustainable extraction or wasteful use of groundwater within the service area. B. The export of water to areas or users outside the service area. C. The waste or unreasonable use of surface water within the service area Page 4 of 8

91 DRAFT: April 12, Section 5. Application of Section 4A A. The prohibition set forth in Paragraph A of Section 4 is applicable to the extraction from any groundwater well in the service area for which an application for a new Well Construction Permit pursuant to the Alameda County Well Ordinance filed after the effective date of this Ordinance. 1. Applications for a Well Construction Permit submitted after that date shall contain sufficient information to demonstrate, based on substantial evidence in the reasonable discretion of Zone 7, that either: (1) one or more of the exemptions set forth in Section 7 apply, or (2) that extraction of groundwater from the proposed well will not constitute unsustainable extraction of groundwater. 2. Zone 7 may, in its reasonable discretion, reject an application for a Well Construction Permit on the ground that the application does not contain sufficient information for Zone 7 to make the necessary determination. Zone 7 may also, in its reasonable discretion, require the applicant for a Well Construction Permit to provide additional information that Zone 7 deems necessary for it to make the necessary determination. The failure of an applicant to provide such requested information in a timely manner, as determined by Zone 7, shall be grounds for Zone 7 to reject the application. 3. In the case of an application for a new Well Construction Permit that requests permission to construct a new well that is designed to replace an existing well that has been permitted prior to the effective date of this Ordinance, Zone 7 shall grant that permit within sixty days, provided that (i) the replacement well has no greater capacity than the well it is replacing, (ii) Zone 7 determines that the original well did not cause or contribute to localized overdraft or other undesirable conditions, and (iii) the well being replaced is destroyed to the reasonable satisfaction of Zone 7 personnel. B. The prohibition set forth in Paragraph A of Section 4 shall apply to the extraction from any groundwater well for which Zone 7 reasonably concludes that the extraction of groundwater constitutes unsustainable extraction of groundwater. In the event of such determination by Zone 7, the affected holder or holders of a Well Construction Permit issued pursuant to the County Well Ordinance for such well shall be notified and shall be required to demonstrate, based on substantial evidence, as determined by Zone 7, that continued extraction of groundwater will not result in an unsustainable extraction of groundwater. Section 6. Exempt Water Management Practices A. The following water management practices are exempt from the prohibitions in Section 4: 1. Water resources management practices of public water agencies that have jurisdictional authority within the service area and that are in compliance with and included in Zone 7 s Groundwater Management Plan and respective Contract for Page 5 of 8

92 DRAFT: April 12, a Municipal and Industrial Water Supply and/or the conditions of use established by Zone De minimis extractions. 3. Groundwater extraction or the export of water in compliance with a permit issued by Zone 7 Water Agency pursuant to this ordinance. B. The following water management practices are exempt from the prohibition against export of water in this ordinance when those practices are carried out in compliance with a permit issued by Zone 7: 1. De-watering of shallow water tables where the net benefits of the removal of subsurface water substantially outweighs the loss of water because of damage the high water table reasonably may cause to agriculture, industry, commerce and other property uses. The groundwater in some areas of the service area is very near the surface and if not removed by interceptor ditches or subsurface tile drains, the water can seriously impact crop root zones for agricultural production or destroy foundations, equipment, materials, buildings and infrastructure used for residences, industry, utilities or commerce. This groundwater may or may not be reused for other purposes and at times may leave the service area and its groundwater system. 2. Reasonable use of groundwater resources to supplement or replace surface water released for other reasonable and beneficial purposes, including but not limited to fisheries, ecosystem habitat or downstream water quality or quantity needs, when required pursuant to federal and state law, regulations, licenses or permit conditions. 3. Conservation of water in compliance with applicable state law that authorizes public water agencies to transfer water outside its usual place of use. Conservation programs may include, but are not limited to, irrigation practices in agricultural areas where the crops grown use less water, or communities that produce recycled water, fix leaks or promote other water saving devices and methods to conserve water on a temporary or permanent basis. 4. Recharge of groundwater in locations in the service area that are capable of improving groundwater conditions in order to meet total water demands of beneficial uses in the hydrologic and groundwater basin area including but not limited to the following sources: surface water, treated municipal drinking water, recycled water and stormwater. The amount of recaptured groundwater transferred out of the area should not exceed the amount of water used to recharge the aquifer. The transfer can be accomplished by either direct or indirect transfer, that is, a public water agency can leave the water in the ground and transfer other supplies in lieu of pumping out the recharge water. 5. Remediation of contaminated groundwater that is pumped and treated to remove contaminants that are in violation of standards for beneficial uses. The Page 6 of 8

93 DRAFT: April 12, extracted and treated water may be released out of the service area, resulting in a net loss to the groundwater basin, if the release complies with discharge permits issued by the federal, state or state resource agencies. 6. Export of water that reasonably supports agricultural operations on property outside the service area that is contiguous with property within the service area and is under common ownership. The foregoing exemptions may be suspended by the Board of Directors pursuant to a declaration of emergency. C. The exemptions set forth in Paragraphs A and B above do not exempt the activities described in those subsections from paragraph B of Section 5. Section 7. Implementation and Enforcement A. The General Manager shall have the primary responsibility for implementation and enforcement of this ordinance and any related regulations adopted by the Board of Directors. That responsibility shall include any preparation, approval and/or certification of any environmental document required under the California Environmental Quality Act (CEQA) for issuance of a permit for a groundwater well, as determined by the General Manager. B. The General Manager shall establish a system of permits to authorize water management practices otherwise prohibited by this ordinance. Zone 7 may issue a permit for a water management practice to the extent that such practice is consistent with the statements of Zone 7 policy set forth in Section 2 of this ordinance, and provided that such practice is for a reasonable and beneficial use of groundwater resources, supports sustainable groundwater management, and promotes the public interest. As part of the permitting system, the General Manager shall establish a schedule of fees that will defray the costs incurred by Zone 7 in implementing this ordinance. C. The General Manager shall have authority to investigate any activity subject to this ordinance. Compliance with this ordinance will be determined based on the submission of a technical report to the General Manager on a form provided by Zone 7. The General Manager is authorized to enforce the prohibition of any activity that is determined to be in violation of this ordinance or regulations adopted by the Board of Directors. D. Any interested person or entity may appeal an administrative determination made by the General Manager under this ordinance, including: 1. finding that an application is complete or incomplete; or 2. establishing or modifying operating conditions; or 3. granting or denying a permit; or Page 7 of 8

94 DRAFT: April 12, suspending or revoking a permit. Administrative appeals under this section must be made in writing, must clearly set forth the reasons why the appeal ought to be granted, and must be received by the General Manager within fifteen days of the postmark date on the envelope that transmits the administrative determination. Any appeal that is not timely filed, or that is not accompanied by the required fee, will be deemed ineffective and the administrative determination that is being appealed will become final. The General Manager shall fix a reasonable time for the hearing of an appeal of an administrative determination, and shall provide written notice of the appeal hearing to the appellant and all interested parties, and to all landowners within one-quarter mile of the (proposed) location of the well. An appeal review committee comprised of the Water Resources Committee of the Board of Directors shall hear the appeal and issue a decision within thirty days after the hearing. The appeal review committee may take any appropriate action upon the original administrative action that was appealed, including granting or denying the appeal in whole or in part, or imposing, deleting or modifying the permit conditions. The decision of the appeal review committee shall be final. Section 8. Groundwater Monitoring. A. All persons, including Public Water Agencies that extract groundwater within the service area shall cause to be prepared and submitted to the General Manager upon periodic request reports of groundwater information that are reasonably necessary to monitor the existing condition of groundwater resources within the service area, to determine trends, or to develop effective sustainable groundwater management plans and policies. A de minimis extractor shall not be required to submit such information. B. The General Manager shall develop and recommend regulations to be adopted by the Board that establish the frequency and timing of required reports, and the required information to be monitored, including without limitation water level and pumping data, or other data necessary for any other method to determine groundwater production. Section 9. Effective Date This ordinance shall take effect thirty (30) days from and after the date of its passage and before the expiration of fifteen (15) days after its passage it shall be published once, with the names of the Directors voting for and against the same, in a newspaper of local circulation Page 8 of 8

95 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING DIVISION: OFFICE OF THE TREASURER CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO. 12 SUBJECT: Proposed Authority to Withdraw Money from the County Treasury SUMMARY: o Zone 7 Water Agency ( Agency ) was established in 1957 to provide flood protection servics and furnish water for municipal, industrial and agricutural uses in eastern Alameda County and it is governed by a seven-member board. o On January 1, 2004, AB 1125 legislation took effect which provided that the elected board of Zone 7 shall govern and control all matters that relate only to Zone 7. Pursuant to AB 1125 legislation the County determined that Zone 7 is not a component unit of the County of Alameda as demonstrated by the fact that Zone 7 s activities are not reported as part of the County Comprehensive Annual Financial Report (CAFR). o The Agency is independently audited each fiscal year and produces its own CAFR. o Zone 7 is spending $1.4 million per year for County services. o Pursuant to Resolution No dated September 21, 2016 and in compliance with Section 36 of the District Act, the Zone 7 Board of Directors appointed an Agency Treasurer to be responsible for its investments and to have custody of the Agency s funds. o On December 21, 2016, the Board directed staff to evaluate the following: Ability to have an Actuarial Valuation and Review of the agency s pension plan Establishment of a trust fund to address the agency s Net Pension Liability (NPL) Agency ability to negotiate with its bargaining unions benefits, including pension-related benefits. o Pursuant to Government Code Section Sections et seq. and et seq., staff recommends withdrawing the Agency s money from the County Treasury, no later than 15 months from the date on which the board of directors adopts attached resolution. FUNDING: N/A RECOMMENDED ACTION: Adopt attached resolution. ATTACHMENTS: Background Memo and Draft Resolution

96 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) DATE: April 19, 2017 M E M O R A N D U M TO: FROM: SUBJECT: Jill Duerig, General Manager Osborn Solitei, Agency Treasurer/Assistant General Manager Finance Proposed Authority to Withdraw Money from the County Treasury BACKGROUND: In 2016 Zone 7 Water Agency ( Agency ) staff held several meetings with County staff (Auditor- Controller Office and County Treasurer s Office) regarding Zone 7 s request to issue its own warrants or checks in-house instead of using the current County process. Authorizing an intention to withdraw money and subsequent withdrawal of that money from the County Treasurer is to accomplish that task. o The Agency was established in 1957 to have local control over flood protection and to import water for municipal, industrial and agricultural uses in eastern Alameda County. The Agency is governed by a seven-member board whose members are elected by the local community to provide policy direction and strategic guidance for the Agency s programs, projects, operations and finances. o Since its inception, the Agency s support services such as payroll, accounts payable, risk management, human resources and purchasing have been provided by Alameda County. o Since 1995, the Agency has maintained its own financial system for accounting and auditing and completely at all times shows the Agency s financial condition. The financial system adheres to generally accepted accounting principles. o On January 1, 2004, AB 1125 legislation took effect which provided that the elected board of the Agency shall govern and control all matters that relate only to the Agency. Under AB 1125 and in accordance with Governmental Accounting Standard Board ( GASB ) Statement No. 14 The Financial Reporting Entity and GASB Statement No. 39 Determining Whether Certain Organizations Are Component Units, the County determined that the Agency is not a component unit of the County of Alameda and therefore, the Agency s activities are not reported as part of the County CAFR. 2

97 DISCUSSION: o Since 1995, the Agency has maintained its own financial system for accounting and auditing that completely at all times shows the Agency s financial condition. The financial system adheres to generally accepted accounting principles. o The Agency is independently audited each fiscal year and produces its own Comprehensive Annual Financial Report. o The Agency already develops, adopts and manages its own operating budget and capital improvement program (CIP) for both Water Enterprise and Flood Control. o The Agency already controls its two operating units, Flood Control and the Water Enterprise. Funds are not commingled either with other District (County) zones or between the two Agency units and the Agency projects serving both flood control and water resources purposes (such as development of the Chain of Lakes) are analyzed critically so that costs can be allocated appropriately; the cost splits are reviewed and analyzed by both water customers (the retailers) and other stakeholders (the local municipalities have a strong interest in flood control expenditures, as do developers). o The Agency s employees already are all in Agency- specific classifications unique to Zone 7 o The Agency already negotiates directly with all four represented bargaining units for the Agencyspecific job classifications for salaries and has since the 1994 MOU amendment. o In fiscal year , the Agency implemented Government Accounting Standards Board ( GASB ) Statement No. 68 Accounting and Financial Reporting for Pensions. This reporting requires the Agency to receive an actuarial valuation report regarding its pension plan from the Alameda County Employees Retirement Association ( ACERA ). With the Agency s current status, the Agency is included as part of the County of Alameda by ACERA and the Agency does not directly receive its own valuation report despite similar reports being afforded to other Agencies within ACERA (Health System, Superior Court, First 5, Housing Authority, LARPD and Office of Education). o On December 13, 2016 the Finance Committee recommended the following actions for the Agency in order to start tackling its Net Pension Liability (NPL): Evaluate the ability to have an Actuarial Valuation and Review of the Agency s Pension Plan separate from the County; Review options for establishment of a trust fund to address the Agency s NPL; and Confer with the County regarding the Agency s ability to negotiate with unions for benefits, including pension-related benefits. o As mentioned above, the Agency uses its own financial system (New World System) for its daily 3

98 operations, but the Agency is also required to utilize the County ACOLINK system for its day-today accounting operations, including, but not limited to, requisitions of services and supplies, payment of vendor invoices, cash reconciliations, journal entries and other accounting functions. o The daily dual accounting operations have created a redundant or duplicative accounting process, inefficient use of staff time and a delay in providing services to the Agency customers. It has also been very costly for Agency operations. Some examples of redundant transactions include: Zone 7 is spending $1.4 million per year for County services of which $660,000 is Countywide indirect costs. Entering accounting transactions manually in two financial systems; ACOLINK (County System) and New World System (Zone 7); Entering purchase requisitions in two separate systems; Purchase Orders (POs) are created in two systems; On-going staffing demands to perform daily reconciliation of all transactions between the two systems (ACOLINK and New World System). Human Resources Delays in recruitment process for the Agency o The intention to withdraw money from the County has many benefits for the Agency, including, but not limited to: Provide the actuarial valuation and review report for the Agency s Pension Plan; Enable the Agency to establish a trust fund to address it s growing NPL; Provide the most efficient and effective financial reporting services to its rate payers and stakeholders; Streamline its purchasing process while establishing controls appropriate for the Agency Eliminate parallel, duplicative and somewhat redundant accounting operations systems; Enhance organizational efficiency and cost effectiveness for the Agency; and Better serve the residents of the service area. o Pursuant to California Government Code Sections et seq. and et seq., staff is recommending withdrawing the Agency s money from the County Treasury, no later than 15 months from the date on which the board of directors adopts its resolution. FUNDING: N/A 4

99 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT BOARD OF DIRECTORS INTRODUCED BY SECONDED BY RESOLUTION NO. Authorization for Zone 7 to Withdraw Money from the County Treasury WHEREAS, Zone 7 Water Agency ( Agency ) was established in 1957 to have local control over flood protection and import water for municipal, agricultural and industrial uses in eastern Alameda County; and WHEREAS, it is governed by a seven-member board whose members are elected by the local community to provide policy direction and strategic guidance for Zone 7 Water Agency s programs, projects, operations and finances; and WHEREAS, all of the Agency s existing funds are held by the County of Alameda so the Agency has limited control over those funds; and WHEREAS, the Agency s support services such as payroll, accounts payable, risk management, human resources and purchasing have been provided by Alameda County; and WHEREAS, pursuant to Section 36 of the District Act, the elected board of the Agency shall govern and control all matters that relate only to the Agency, the County determined that the Agency is not a component unit of the County of Alameda and therefore, the Agency s activities are not reported as part of the County Comprehensive Annual Financial Report ( CAFR ); and WHEREAS, since 1995, the Agency has maintained its own financial system for accounting which completely and accurately shows the Agency s financial condition, while adhering to generally accepted accounting principles; and WHEREAS, the Agency is independently audited each fiscal year and produces its own Comprehensive Annual Financial Report; and WHEREAS, per Resolution No dated September 21, 2016 and pursuant to Section 36 of the District Act, the Zone 7 Board of Directors appointed an Agency Treasurer to be responsible for its investments and to have custody of the Agency s funds; and WHEREAS, the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District has entered into an agreement with MUFG Union Bank, N.A., to provide banking services for a period of three years, with annual renewals at the Agency s option; and WHEREAS, pursuant to the California Government Code Sections et seq. and et seq., staff recommends withdrawing the Agency s money from the County Treasury, no later than 15 months from the date on which the board of directors adopts this resolution; 5

100 NOW THEREFORE BE IT RESOLVED that the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District does hereby approve the withdraw of all Zone 7 funds from the County Treasury, no later than 15 months from the date of this resolution; and BE IT FURTHER RESOLVED, that the General Manager and Agency Treasurer be directed and authorized to send a letter to the County of Alameda Treasurer providing the Notice of Intent to withdraw funds. ADOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a resolution Adopted by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District on April 19, 2017 By President, Board of Directors 6

101 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING DIVISION: OFFICE OF THE TREASURER CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO. 13 SUBJECT: Authorization for Banking/Depository Services, Custodial Services, Investment Management Services and Designating Financial Signature. SUMMARY: o Currently, the Agency banking depository and security custody services are provided by MUFG Union Bank, N.A through the County of Alameda. o Pursuant to Resolution No dated September 21, 2016 and in compliance with Section 36 of the District Act, Zone 7 Board of Directors appointed Agency Treasurer to be responsible for its investments and to have custody of the Agency s funds. o Pursuant to Resolution No , the FY adopted budgets assumes borrowing of up to $43 million to fund water system capital improvement projects. The debt proceeds will be held by the Agency under the supervision of the Agency Treasurer. o Pursuant to Resolution No , the Board approved Camp Parks Project Phase 1 Agreement Endowment fund. To ensure accountability and transparency, the endowment funds will be held by the Agency under the supervision of the Agency Treasurer. o Pursuant to Resolution No , the Board authorized the General Manager to execute and submit the Drinking Water State Revolving Fund funding application (SRF) for the construction of Ozone projects at the two water plants. o Pursuant to Government Code Section Sections et seq. and et seq., staff recommends authorization for the Treasurer to negotiate with MUFG Union Bank, N.A, for the banking/depository services and HighMark Capital Management for investment services. o The proposed estimated fee for custodial and investment management services is $160, 000. The banking services will be offset by the Earning Credit Rate (ECR) from the concentrated account, so no costs are anticipated. FUNDING: N/A RECOMMENDED ACTION: Adopt attached resolution. ATTACHMENTS: Background Memo, Draft Resolution and Resolution No

102 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) DATE: April 19, 2017 M E M O R A N D U M TO: FROM: SUBJECT: Jill Duerig, General Manager Osborn Solitei, Agency Treasurer/Assistant General Manager Finance Authorization for Banking/Depository Services, Custodial Services, Investment Management Services and Designating Financial Signature. BACKGROUND: In 2016 Zone 7 Water Agency ( Agency ) staff held several meetings with County staff (Auditor- Controller Office and County Treasurer s Office) regarding Zone 7 s request to issue its own warrants or checks in-house instead of using the current County process. The intention to withdraw money from the County Treasurer is to accomplish that task. o The Agency was established in 1957 to provide flood protection servics and furnish water for municipal, industrial and agricutural uses in eastern Alameda County. The Agency is governed by a seven-member board whose members are elected by the local community to provide policy direction and strategic guidance for the Agency s programs, projects, operations and finances. o Since its inception, the County of Alameda has provided a Trustee for the Agency funds and the banking depository and security custody services are provided through MUFG Union Bank, N.A o On January 1, 2004, AB 1125 legislation took effect which provided that the elected board of the Agency shall govern and control all matters that relate only to the Agency. o On March 21, 2012, pursuant to Resolution No (attached), the General Manager was granted authority to enter into a contract with Wells Fargo Bank, N.A. relating to deposits and disbursement of Agency funds. o Pursuant to the Agency resolution no dated September 21, 2016 and in compliance with Section 36 of the District Act, the Zone 7 Board of Directors appointed an Agency Treasurer to be responsible for its investments and to have custody of the Agency s funds. 2

103 DISCUSSION: o Since 1995, the Agency has maintained its own financial system for accounting and auditing and completely at all times shows the Agency s financial condition. The financial system adheres to generally accepted accounting principles. o Currently, the Agency banking services are provided by MUFG Union Bank, N.A through the County of Alameda. o Pursuant to Resolution No dated September 21, 2016 and in compliance with Section 36 of the District Act, Zone 7 Board of Directors appointed the District or Agency Treasurer to be responsible for its investments and to have custody of the Agency s funds. o Pursuant to Resolution No , the board adopted budgets for FY and , in the Budget, the board authorized staff to pursue debt financing for the construction of Ozone at the Del Valle ( DVWTP ) and Patterson Pass Water Treatment Plant ( PPWTP ). The debt financing proceeds will be held by a Trustee under the Agency name, under the supervision of the Agency Treasurer. o Pursuant to Resolution No , the Board approved Camp Parks Project Phase 1 Agreement Endowment fund. To ensure accountability and transparency, the endowment funds will be held by the Agency under the supervision the Agency Treasurer. o Pursuant to Agency Resolution No , the Board authorized the General Manager to execute and submit all documents necessary to complete a Drinking Water State Revolving Fund funding application (SRF) for the construction of Ozone at the DVWTP and PPWTP and the loan proceed from SRF will be held by the Agency under the supervision of the Agency Treasurer. o Staff are recommending the Board to approve the following: 1) an Agreement with MUFG Union Bank, N.A. for banking and custodial Services; 2) an agreement with HighMark Capital Management for investment management services; and adopt a resolution designating staff persons to sign on behalf of the Agency to transact routine business with MUFG Union Bank, N.A and HighMark Capital Management. FUNDING: The estimated fee for custodial and investment services will be $160, 000 for 200 million in assets and a minimum of $10,000 for assets below $10 million. The banking services will be offset by the Earning Credit Rate (ECR) from the concentrated or general checking account. 3

104 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT BOARD OF DIRECTORS INTRODUCED BY SECONDED BY RESOLUTION NO. Authorization for Banking/Depository Services, Custodial Services, Investment Management Services and Designating Financial Signature. WHEREAS, Zone 7 through the County of Alameda current uses MUFG Union Bank, N.A. for its banking and custodial services; and WHEREAS, For deposits in excess of the amount insured under any federal law, a contract in accordance with Section is required; and WHEREAS, MUFG Union Bank, N.A. has indicated that it can provide the currently required custodial and investment services for an estimated annual amount of $160,000; and NOW THEREFORE BE IT RESOLVED that the Zone 7 Board does hereby approve MUFG Union Bank, N.A. for banking and custodial services; and BE IT FURTHER RESOLVED that the Zone 7 Board does hereby approve HighMark Capital Management for investment management services; and BE IT FURTHER RESOLVED, that the General Manager be authorized to negotiate and execute an agreement with MUFG Union Bank, N.A. and High Mark Capital Management to provide primary banking services, custodial services and investment management services to the Agency for a three-year period, for an estimated annual amount of $160,000 for current service levels; and be it BE IT FURTHER RESOLVED, that the General Manager be authorized to negotiate and execute an agreement with MUFG Union Bank, N.A. and High Mark Capital Management to provide primary banking services, custodial services and investment management services to the Agency for a three-year period, for an estimated annual amount of $160,000 for current service levels; and be it BE IT FURTHER RESOLVED, that the Zone 7 Board of Directors of Alameda County Flood Control and Water Conservation District does hereby authorize the General Manager to extend the contract for MUFG Union Bank, N.A. and HighMark for up to two additional one-year periods based on satisfactory performance; and be it BE IT FURTHER RESOLVED, Zone 7 Board does hereby approve the General Manager and the Agency Treasurer/Assistant General Manager Finance are authorized as the signatory of all bank accounts for Zone 7; and 4

105 BE IT FURTHER RESOLVED, that the Board of Directors does authorize the General Manager to negotiate an agreement with a similarly qualified bank to perform the Agency banking, custodial and investment management services should the General Manager be unable to negotiate an agreement with MUFG Union Bank, N.A. and HighMark Capital Management or if, subsequent to implementing the agreement, the services are deemed not satisfactory by the Agency. ADOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a resolution Adopted by the Board of Directors of Zone 7 of Alameda County Flood Control and Water Conservation District on April 19, 2017 By President, Board of Directors 5

106

107 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING DIVISION: OFFICE OF THE TREASURER CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO. 14 SUBJECT: Investment Policy SUMMARY: o Pursuant to Resolution No dated September 21, 2016 and in compliance with Section 36 of the District Act, the Zone 7 Board of Directors appointed an Agency Treasurer to be responsible for its investment and custody of the Agency s funds. o Pursuant to Government Code Section 53607, the Board may delegate authority to deposit and invest Agency funds to the Treasurer. o In accordance with California Code Section 53600, et. seq.,public funds should be prudently invested or deposited consistent with applicable laws and the policies of the Board to produce revenue for the Agency. o The Agency Treasurer ("Treasurer") is responsible for sound financial management practices when managing the Agency s funds. The proposed policy describes the primary goals of the Treasurer when investing funds as follows: o Preservation of capital to safeguard the funds under the Treasurer's control; o Liquidity to meet short term cash needs; o Diversity to reduce the portfolio risks; and o Yield to maximize the portfolio overall return. o The proposed policy adequately balances the needs of safety, liquidity, diversity and yield and therefore, staff recommends the Board adopt the attached investment policy. FUNDING: N/A RECOMMENDED ACTION: Adopt the attached resolution approving the Investment Policy. ATTACHMENTS: Resolution Attachment A Proposed Investment Policy 1

108 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) DATE: April 19, 2017 M E M O R A N D U M TO: FROM: SUBJECT: Jill Duerig, General Manager Osborn Solitei, Treasurer/Assistant General Manager Finance Investment Policy BACKGROUND: o Zone 7 Water Agency ( Agency ) was established in 1957 to provide flood protection servics and furnish water for municipal, industrial and agricutural uses in eastern Alameda County and it is governed by a seven-member board. o On September 21, 2016, the Board of Directors adopted Resolution No which, pursuant to Section 36 of the District Act, appointed the Agency Treasurer ( Treasurer ) to be responsible for its investments and have custody of the Agency s funds. DISCUSSION: The Agency s Draft Investment Policy is consistent with the California Government Code and follows the priorities of safety, liquidity, diversity and yield. The Investment Policy applies to the Agency's pooled investment fund which encompasses all monies under the direct oversight of the Agency Treasurer. Included in the investment pool are the Water Enterprise Operations Funds, Renewal/Replacement & System-Wide Improvement Fund, State Water Facilities Fund, Water Enterprise Capital Expansion Fund, Flood Control Operations Fund, Flood Protection Development Impact Fee Fund, Water Facilities Fund, Water Supply and Reliability Fund, Vehicle/Equipment Replacement Reserve Fund, Endowments, all other funds held by the Agency and debt proceeds (if any) with special consideration given to specific provisions contained in the indentures for each debt issuance. Investment Objective: Per Section of the California Government Code, the primary objective of the Treasurer shall be to safeguard the principal of the funds under his or her control when investing public funds. The secondary objective will be to maintain liquidity as required by the Agency and the third objective is to obtain a return on investment of these funds. In order of priority, four fundamental criteria shall be followed in the investment of funds: o Safety of Principal Investments shall be undertaken in a manner which first seeks to ensure the preservation of principal in the portfolio. Each investment transaction shall be entered only after taking into consideration the quality of the issuer, the underlying security or 1

109 collateral, and diversification of the portfolio. Cash flow analysis will be conducted and utilized to avoid the need to sell securities prior to maturity. The Agency shall seek to preserve principal by mitigating both credit and market risk. o Liquidity Every effort shall be made to ensure that the Agency s portfolio is sufficiently liquid to meet current and anticipated operating requirements. Cash flow analysis should be performed on an ongoing basis. Investments shall be made to ensure maturities are compatible with anticipated cash flow requirements. o Return on Investment, or Yield Investments shall be undertaken to produce an investment return consistent with the primary objectives of Safety of Principal and Liquidity, and the Prudent Investor Standard. o Diversity The objective is to avoid over concentration or exposure to any one issuer, instrument or maturity sector as specified in the Summary Table of Investment Guidelines and Eligible Securities herein, so that no single investment or class of investments can have a disproportionate impact on the total portfolio. This restriction does not apply to U.S. Treasury securities. Delegation of Authority to Deposit and Invest Public Funds The authority to deposit and invest public funds belongs to the Board and may be delegated to the Treasurer or his/her designee. The Treasurer is appointed by the Board or if no such appointment has been made, the General Manager may act as the Treasurer. Per Government Code Section 53607, the delegation of authority to invest must be renewed annually. If the Board chooses not to delegate the authority to invest, the Treasurer will be limited to making deposits only, and the Board will be responsible for the investment of the Agency s funds. Through the attached resolution the Board of Directors, pursuant to the provisions of the California Government Code, delegates to the Treasurer, the authority to invest or deposit such funds in accordance with the provisions of the Government Code. FISCAL IMPACT: Adoption of this resolution will ensure that Agency funds shall be invested in accordance with this Investment Policy. RECOMMENDED ACTION: Adopt the attached resolution approving the Investment Policy. ATTACHMENTS: Resolution Attachment A Proposed Investment Policy 2

110 ZONE 7 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT BOARD OF DIRECTORS RESOLUTION NO INTRODUCED BY SECONDED BY ADOPTING INVESTMENT POLICY AND DELEGATING AUTHORITY TO DEPOSIT AND INVEST FUNDS TO THE TREASURER WHEREAS, Zone 7 was established in 1957 to provide flood protection services and to furnish water for municipal, industrial and agricultural uses in eastern Alameda County and it is governed by a seven-member board; and WHEREAS, Pursuant to Resolution No dated September 21, 2016 and in compliance with Section 36 of the District Act, the Zone 7 Board of Directors appointed an Agency Treasurer to be responsible for its investments and to have custody of the Agency s funds; and WHEREAS, the Legislature of the State of California has declared that the deposit and investment of public funds by local officials and local agencies is an issue of statewide concern; and WHEREAS, the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District, in accordance with Section 53600, et. seq., of the Government Code of the State of California, finds that public funds should be prudently invested or deposited consistent with applicable laws and the policies of the Board to produce revenue for the Agency; and WHEREAS, from time to time, there are Agency funds available for the purpose of investment or deposit; and WHEREAS, it will be more convenient in the handling of said bonds or other securities so purchased that they be held in safekeeping by said banks while they are the property of this Agency; and NOW, THEREFORE BE IT RESOLVED by the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District that the Treasurer and/or Assistant General Manager - Finance, appointed by the Agency pursuant to California Government Code Sections and 53608, is hereby authorized to invest or deposit for safekeeping, as far as possible, all money belonging to, or in the custody of, the Agency pursuant to the Government Code and as directed by the policies of the Board. BE IT FURTHER RESOLVED that the Treasurer and his or her designee be and are hereby authorized to invest in permissible investments, or to deposit in interest-bearing accounts with authorized financial institutions, funds in a sinking fund or funds of this Agency from any of the various accounts of this Agency when such funds will not be needed for the immediate necessities of the Agency; and 3

111 BE IT FURTHER RESOLVED that the resolution is effective April 19, 2017, and shall be reconsidered by the Board annually for the next fiscal year. BE IT FURTHER RESOLVED that the Board of Directors of Zone 7 of the Alameda County Flood Control and Water Conservation District does hereby adopt the attached Investment Policy. DOPTED BY THE FOLLOWING VOTE: AYES: NOES: ABSENT: ABSTAIN: I certify that the foregoing is a correct copy of a resolution Adopted by the Board of Directors of Zone 7 of Alameda County Flood Control and Water Conservation District on April 19, 2017 By President, Board of Directors 4

112 ZONE 7 WATER AGENCY POLICY AND PROCEDURE POLICY TITLE: INVESTMENT POLICY NUMBER: PAGE: 1 of 23 APPROVED BY: REVISION: EFFECTIVE DATE: This policy is intended to provide guidelines for the prudent investment of surplus cash, reserves, trust funds and restricted monies and to outline a policy for maximizing the efficiency of the Agency s cash management system. 1.0 POLICY It is the policy of the Board of Directors of the Zone 7 Water Agency ( Agency ) to invest public funds in a manner which conforms to the four fundamental criteria in order of importance, as listed: Safety of Principal Liquidity Return on Investment, or Yield Diversity 2.0 INVESTMENT AUTHORITY In accordance with Section 53600, et. seq., of the Government Code of the State of California, the authority to invest Agency public funds has been delegated to the Agency Treasurer/Assistant General Manager Finance. 3.0 DELEGATION OF AUTHORITY Responsibility for the investment program is specifically delegated by the Board to the Board-appointed Treasurer or, if no such appointment has been made, to the General Manager, hereafter referred to as Treasurer who will establish procedures for the investment program, consistent with this Investment Policy. The Treasurer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities, including procedures to execute investment transactions in the absence of the Treasurer. 4.0 STATEMENT OF OBJECTIVES Per Section of the California Government Code, the primary objective of the Treasurer shall be to safeguard the principal of the funds under his or her control when investing public funds. The secondary objective will be to maintain liquidity as required by the Agency and the third objective is to obtain a return on investment of these funds.

113 Investment Policy In order of priority, the four fundamental criteria shall be followed in the investment of funds: No. XXX 4.1 Safety of Principal Investments shall be undertaken in a manner which first seeks to ensure the preservation of principal in the portfolio. Each investment transaction shall be entered only after taking into consideration the quality of the issuer, the underlying security or collateral, and diversification of the portfolio. Cash flow analysis will be conducted and utilized to avoid the need to sell securities prior to maturity. The Agency shall seek to preserve principal by mitigating both credit and market risk. 4.2 Liquidity Every effort shall be made to ensure that the Agency s portfolio is sufficiently liquid to meet current and anticipated operating requirements. Cash flow analysis should be performed on an ongoing basis. Investments shall be made to ensure maturities are compatible with anticipated cash flow requirements. 4.3 Return on Investment, or Yield Investments shall be undertaken to produce an investment return consistent with the primary objectives of Safety of Principal and Liquidity, and the Prudent Investor Standard. 4.4 Diversity The objective is to avoid over concentration or exposure to any one issuer, instrument or maturity sector as specified in the Summary Table of Investment Guidelines and Eligible Securities herein, so that no single investment or class of investments can have a disproportionate impact on the total portfolio. This restriction does not apply to U.S. Treasury securities. The investment portfolio shall be diversified and designed to attain a market average rate of return, taking into account cash flow requirements, striving to maintain an average portfolio maturity of approximately twenty-four (24) months. The Treasurer shall have an overall investment objective of holding investments to maturity and not investing with the objective of actively trading or trading for speculative purposes. However, the Treasurer may, from time to time, swap or sell securities in order to re-position securities to current coupon issues, maintain proper asset allocation limits, or to realize profits from market value appreciation. The Treasurer may sell securities in order to protect the overall quality of the portfolio under the following circumstances: i) To raise cash to meet unanticipated cash-flow requirements ii) To swap old securities for current coupon securities iii) Maintain portfolio allocation limits iv) To avoid further erosion and loss of investment principal due to deterioration in creditworthiness, as well as to respond to rapidly changing interest rate environments 5.0 SCOPE The Investment Policy applies to all funds of the Agency including Water Enterprise Operations Funds, Renewal/Replacement & System-Wide Improvement Fund, State Water Facilities Fund, Water Enterprise Capital Expansion Fund, Flood Control Operations Fund, Flood Protection Development Impact Fee Fund, Water Facilities Fund, Water Supply and Reliability Fund, Vehicle/Equipment Replacement Reserve Fund, Endowments, and all other funds held by the Agency. This investment policy does not apply to proceeds of notes, bonds or similar external financings which would be invested pursuant to bond indentures or State of California Government Code Section 53600, et. seq., as applicable. 2

114 Investment Policy 6.0 PRUDENT INVESTOR STANDARD No. XXX All investments and evaluation of such investments shall be made with the Prudent Investor Standard as set forth in the California Government Code, Sections and , which is defined as a standard of conduct whereby any person authorized to make investment decisions on behalf of the Agency acts with care, skill, prudence and diligence under the circumstances then prevailing, including but not limited to, the general economic conditions and the anticipated needs of the Agency with the aim to safeguard principal and meet the liquidity needs of the Agency. 7.0 PORTFOLIO ADJUSTMENTS Portfolio percentage limitations for each category of investment are applicable only at the date of purchase. Should an investment percentage be exceeded due to instances such as the fluctuation in overall portfolio size, or market valuation changes, the Treasurer is not required to sell the affected securities. Should a security held in the portfolio be downgraded below the minimum rating criteria specified in this Investment Policy, the Treasurer shall sell such security in a manner designed to minimize losses. If the security is downgraded to a level that is less than investment grade, the Treasurer shall perform a credit analysis of such security to determine whether hold or sell the security. The Treasurer may elect to sell the security immediately to minimize losses in the event that an orderly disposition with minimal losses cannot be achieved. If the security matures within sixty (60) days of the rating decline, the Treasurer may choose not to sell the affected security. The Treasurer shall note in a quarterly report securities which have been downgraded below investment grade and the status of disposition. 8.0 SAFEKEEPING AND CUSTODY All securities transactions entered into by the Agency shall be conducted on a delivery-versus-payment (DVP) basis pursuant to a custodial safekeeping agreement. All securities owned by the Agency shall be held in safekeeping by an independent custodian designated by the Treasurer. Financial institutions providing safekeeping services shall provide reports or receipts which verify securities held in safekeeping. 9.0 REPORTING The Treasurer shall submit a quarterly report within 30 days following the end of the quarter covered by the report to the Agency Board of Directors pursuant to California Government Code Section (b)(1). The report shall at a minimum provide information on compliance to this policy and on the composition of the portfolio for each fund with: Types of investment Issuer Maturity dates Par and dollar amount Market values including source of the valuation Rates of Interest Expected yields to maturity 3

115 Investment Policy No. XXX In addition, the quarterly report shall also include a statement denoting the ability to meet the Agency s expenditure requirements for the next six (6) months INVESTMENT GUIDELINES AND ELIGIBLE SECURITIES Section 53600, et seq., of the Government Code of the State of California prescribes the statutory requirement relating to investments by local treasurers, providing guidance on: i) Allowable Investments ii) Portfolio diversification requirements including proportional limits on investment types, maximum maturity, and minimum credit rating criteria. The maximum maturity of any investment in the portfolios shall not exceed five (5) years except when specifically authorized by the Agency Board of Directors through resolution. When practical, the Treasurer shall solicit more than one quotation on each trade for the purpose of awarding investment trades on a competitive basis. The Agency will conform to the legal provisions set forth in the Government Code with further and more specific requirements about allowable investments and restrictions as detailed below: 10.1 US Treasury Bonds, Bills and Notes Bills, notes and bonds issued by the U.S. Treasury which are direct obligations of the federal government. Unlimited investments Maximum maturity of five (5) years Credit Requirement: N.A Federal Agency Bonds and Notes Notes and bonds of federal agencies, government-sponsored enterprises and international institutions. Not all are direct obligations of the U. S. Treasury but may involve federal sponsorship and/or guarantees, in some instances. Limited to forty percent (40%) of Portfolio Maximum maturity of five (5) years Credit Requirement: N.A Banker s Acceptances Bills of exchange or time drafts drawn on and accepted by a commercial bank, typically created from a letter of credit issued in a foreign trade transaction. Limited to forty percent (40%) of the Portfolio Issued by banks with total deposits of over one billion dollars ($1,000,000,000) Maximum maturity of one-hundred eighty (180) days Twenty-five percent (25%) limitation to any one issuer Credit requirement: Ratings of A1, P1 or F1 or better by two of the three nationally-recognized rating agencies: S&P, Moody s, or Fitch, respectively. No rating may be lower than any of the rating listed above. Issued by banks from offices in the USA. 4

116 Investment Policy No. XXX 10.4 Commercial Paper Commercial paper is defined as short-term, unsecured promissory notes issued by financial and non-financial companies to raise short-term cash. Financial companies issue commercial paper to support their consumer and/or business lending; non-financial companies issue for operating funds. Limited to Twenty-five percent (25%) of Portfolio Maximum Maturity of two hundred seventy (270) days Ten percent (10%) limitation on outstanding commercial paper to any one issuer Credit requirement: Ratings of A1, P1 or FI or better by two of the three nationally-recognized rating agencies: S&P, Moody s, or Fitch, respectively. No rating may be lower than any of the rating listed above. Limited to paper issued by corporations organized and operating in the U.S. with total assets in excess of five hundred million ($500,000,000), and having A or higher ratings for the issuer s debt, other than commercial paper, if any, as provided by national recognized rating agency Medium Term Corporate Notes Corporate Bonds, Corporate Notes and Deposit Notes. Issuers are banks and bank holding companies, thrifts, finance companies, insurance companies and industrial corporations. These debt obligations that are generally unsecured. Limited to thirty percent (30%) of Portfolio Maximum maturity of five (5) years Twenty-five percent 25% limitation to any single issuer Credit Requirement: Must be rated A3, A- or AA or better by two of the three nationally-recognized rating agencies: S&P, Moody s, or Fitch, respectively. No rating may be lower than any of the ratings listed above Negotiable Certificates of Deposit Issued by commercial banks and thrifts, and foreign banks (Yankee CD's). Limited to thirty percent (30%) of the Portfolio, with five percent (5%) per issuer Maximum maturity of five (5) years Credit Requirement: Rated A, A2 or A (S&P, Moody s or Fitch, respectively) Issued by banks with total deposits of one billion dollars ($1,000,000,000) or more 10.7 Certificates of Time Deposit Time deposits, which are non-negotiable, are issued most commonly by commercial banks, savings and loans and credit unions with federal deposit insurance available for amounts up to two hundred-fifty thousand ($250,000). Limited to thirty percent (30%) of Portfolio for all deposits Maximum maturity five (5) years On uncollateralized deposits, limited to FDIC insured amount of two hundredfifty thousand ($250,000) Amounts over FDIC insured amount must be fully collateralized 5

117 Investment Policy No. XXX Credit Requirement: For federally-insured deposits of two hundred-fifty thousand ($250,000) or less, no minimum credit rating required. For deposits over two hundred-fifty thousand ($250,000): Ratings of A, A2, or A or better by two of the three nationally-recognized rating agencies: S&P, Moody s, or Fitch, respectively. Pursuant to Government Code 53637, the Agency is prohibited from investing in certificate of deposits of a state or federal credit union if a member of the legislative body or decision-making authority serves on the board of directors or committee Money Market Mutual Funds Regulated by the SEC, these funds operate under strict maturity and diversification guidelines. These funds have no federal guarantee but are viewed as a very safe short-term cash investment. Limited to twenty percent (20%) of Portfolio Rating Requirement: Top ranking or highest letter and numerical rating provided by at least two nationally recognized statistical rating organizations Daily liquidity NAV requirement: one dollar ($1.00) Funds must be invested in securities and obligations permitted under the California Government Code 10.9 State of California, Local Agency Investment Fund (LAIF). LAIF is a pooled investment fund overseen by the State Treasurer, which operates like a money market fund, but is for the exclusive benefit of governmental entities within the state. The maximum investment amount currently authorized by Local Agency Investment Fund (LAIF) is sixty-five million ($65 million), which is subject to change. The LAIF is in trust in the custody of the State of California Treasurer. The Agency s right to withdraw its deposited monies from LAIF is not contingent upon the State s failure to adopt a State Budget. Unlimited investments as specified by Section of the California Government Code. May place funds with LAIF up to the maximum allowable amounts as stipulated by LAIF and amended from time to time. Maximum Maturity: N/A Municipal Bonds and Notes Municipal obligations issued by a municipality within the State of California and any other of the states in the union. This may include bonds, notes, warrants, or other evidences of indebtedness of a local agency within the state. Limited to forty percent (40%) of Portfolio Maximum maturity of five (5) years Must be issued by State of California or California local agency Credit Requirement: Prudent person standard applies 6

118 Investment Policy No. XXX Repurchase Agreement A repurchase agreement is a purchase of authorized securities with terms including a written agreement by the seller to repurchase the securities on a future date and price. Limited to twenty percent (20%) of Portfolio Maximum maturity of two hundred seventy (270) days Master Repurchase Agreement must be on file Limited to primary dealers or financial institutions rated A or better by Moody s or equivalent. Fully collateralized at market value of at least one hundred two percent (102%) with US government or federal agency securities California Asset Management Program (CAMP) Limited to ten percent (10%) of Portfolio Rated highest short term rating by largest nationally recognized rating services Credit rating requirements for eligible securities as specified in this policy shall mean alpha numeric designations assigned by the following rating agencies: Moody s Investors Service Standard & Poor s Rating Services Fitch IBCA, Inc. Thompson Bank Watch Please see Rating Description table herein, below MONITORING SAFETY AND LIQUIDITY The Treasurer shall monitor on an ongoing basis investments for exposure to risk and credit deterioration to ensure primary objectives of safety of principal and liquidity are adhered to. Such matters shall be reported to the Agency Board of Directors as part of the Treasurer s quarterly and/or annual report ADMINISTRATION The Treasurer may, at any time, establish more restrictive requirements for securities approved for investment as deemed appropriate in this Investment Policy. These restrictions may include, but are not limited to, higher credit ratings, lower percentage limits by security type or issuer, shorter maturities and additional collateral requirements for collateralized investments PURCHASING ENTITIES Investments not purchased directly from the issuer will be purchased from institutions licensed by the State of California as a broker/dealer, including: National or California State Chartered Banks Federal or California Chartered Savings Institutions Brokerage firms designated as a primary government dealer by the Federal Reserve Bank 7

119 Investment Policy Member of a federally-regulated securities exchange Institutions licensed by the State of California as a broker/dealer No. XXX Federal or state savings institutions or associations as defined in Finance Code Section 5102 The Treasurer or designee will maintain a current and eligible list of reputable primary and regional dealers, brokers and financial institutions with whom securities trading and placement of funds are authorized. A strong capital base credit worthiness, and, where applicable, a broker/dealer staff experienced in transactions with California local governments are the primary criteria for inclusion on the Agency s approved list. Approved dealers and brokers shall be limited to primary dealers or regional dealers that qualify under Securities and Exchange Commission Rule 15C3-1 (uniform net capital rule) and which provide: proof of Financial Industry Regulatory Authority (FINRA) certification; proof of California State registration; and a completed Agency broker/dealer questionnaire. In addition, prior to approval and for every two years thereafter, approved dealers and brokers must provide: an audited financial statement; certification of receipt, review of and willingness to comply with the current Investment Policy; and certification of compliance with Rule G-37 of the Municipal Securities Rulemaking Board regarding limitations on political contributions to the Board of Directors of the Agency or to any candidate for these offices. The Treasurer may remove a firm from the approved list at any time due to: any failure to comply with any of the above criteria; any failure to successfully execute a transaction; any change in broker/dealer staff; or any other action, event or failure to act which, in the sole discretion of the Treasurer is materially adverse to the best interests of the Agency INVESTMENT SECURITY To ensure a high degree of internal control, the Agency shall comply with the following; All securities purchased from dealers and brokers shall be held in safekeeping by the Agency s custodial bank, a national bank, a State chartered bank or trust company, established for this purpose as someone other than the selling party of the security. Securities purchased will be covered by a trust or safekeeping receipt in a manner that establishes the Agency s ownership. All transactions completed on a delivery versus pay basis (DVP). All trade confirmation shall be received directly and reviewed for conformity to the original transaction by an individual other than the person originating the transaction. All trade confirmation must be an original; copies of confirmations are not allowed. Any discrepancies will be brought to the attention of the Treasurer FUND WIRE PROCEDURES Payment for securities purchased from broker dealers that are ineligible for safekeeping will be made through the Agency s custodial bank. Funds will only be transferred subsequent but immediately following the custodial bank s acknowledgement that they are prepared to make settlement on the terms and conditions specified by the Agency. Payment for securities purchased from bank investment departments that will be safely kept with the trust department of the bank will be made immediately upon confirmation of the trade. 8

120 Investment Policy No. XXX 16.0 PERFORMANCE REVIEW AND INTERNAL CONTROL The Treasurer or designee shall maintain a system of internal controls designed to ensure compliance with the Investment Policy and to prevent losses due to fraud, employee error, and misrepresentations by third parties or unanticipated changes in financial markets. The internal control includes; the activities of any subordinate officials acting on behalf of the Agency. Procedures should include references to individuals authorized to execute transactions or transfers, safekeeping agreements, repurchase agreements, wire transfer agreements, collateral/depository agreements and banking services contracts, as appropriate. As part of the Comprehensive Annual Financial Report (CAFR) audit, the Agency s external auditor will perform a review of investment transactions to verify compliance with policies and procedures ETHICS AND CONFLICT OF INTEREST All officers and employees involved in the investment process shall refrain from engaging in any personal business activity which could conflict with proper execution of investments subject to this Policy. Any material financial interests in financial institutions which do business with the Agency should be disclosed to the General Manager of the Agency. All individuals involved in the investment process are required to report all gifts and income in accordance with California State Law. 9

121 Investment Policy SUMMARY TABLE OF INVESTMENT GUIDELINES AND ELIGIBLE SECURITIES No. XXX Authorized Investments Maximum % Holdings Purchase Restrictions Maximum Maturity Credit Quality US Treasury Bonds, Bills and Notes 100% N/A 5 Years N/A Federal Agency Bonds & Notes 40% N/A 5 Years Full backing by the federal government of the United States of America Bankers Acceptance 40% 25% limitation to a single issuer 180 days A-1/P-1 rated by S&P and Moody s or equivalent for domestic banks Commercial Paper Medium Term Corporate Notes 25% 10% limitation to single issuer 30% 25% limitation to a single issuer. Limited to US licensed and operating corporations 270 days A-1/P-1 rated by S&P and Moody s or equivalent AA rated by S&P or equivalent for US branch of foreign banks 5 years A3 rated by at least one nationally recognized rating service Negotiable CD 30% National or state charted bank, S&L, or branch of foreign bank 5 years A rated by one or more nationally rated credit rating agencies Certificates of Time Deposit Money Market Mutual Funds 30% See California Government Code Section % Must maintain constant NAV of $ Years Limit to FDIC Insured amount $250,000, Fully collateralized on amounts over the insured amount in accordance with California Government Code Daily Liquidity Top ranking or highest letter and numerical by 2 of the 3 nationally recognized rating services 10

122 Investment Policy No. XXX Authorized Investments Maximum % Holdings Purchase Restrictions Maximum Maturity Credit Quality State of California, Local Agency Investment Fund ( LAIF ) Fund must be invested in securities and obligation permitted under Government Code 100% None N/A Subject to California Government Code Section limitations Municipal Bonds & Notes Repurchase Agreements ( REPO ) 40% State of California or California agencies 20% Limited to primary dealers or financial institutions rated A or better by Moody s 5 Years Prudent person standard 270 days Fully collateralized (min 102% of funds borrowed with daily mark to market) with US Government or federal agency securities with maximum 5 year maturities California Asset Management Program ( CAMP ) 10% N/A Daily Liquidity Highest short term rating by S&P, Moody s and/or Fitch 11

123 Investment Policy RATING DESCRIPTION TABLE Long Term Debt Ratings No. XXX Credit Quality Moody s S&P Fitch Strongest Quality Aaa AAA AAA Strong Quality Aa1/Aa2/Aa3 AA+/AA/AA- AA Good Quality A1/A2/A3 A+/A/A- A Medium Quality Baa1/Baa2/Baa3 BBB+/BBB/BBB- BBB Speculative Ba1/Ba2/Ba3 BB+/BB/BB- BB Low B1/B2/B3 B+/B/B- B Poor Caa CCC+ CCC Highly Speculative Ca/C CCC/CCC-/CC CC Short Debt Ratings Credit Quality Moody s S&P Fitch Strongest Quality P-1 A-1+ F1 Strong Quality A-1 Good Quality P-2 A-2 F2 Medium Quality P-3 A-3 F3 Note: Investment Grade ratings applies to securities with at least a medium credit quality or higher by one of the nationally recognize rating organization, anything below the medium credit quality is noninvestment grade. 12

124 Investment Policy EXHIBIT A GLOSSARY No. XXX ACCRETION: Adjustment of the difference between the prices of a bond bought at an original discount and the par value of the bond. AGENCIES: Federal agency securities and/or Government-sponsored enterprises (GSEs), also known as U.S. Government instrumentalities. Securities issued by Government National Mortgage Association (GNMA) are considered true agency securities, backed by the full faith and credit of the U.S. Government. GSEs are financial intermediaries established by the federal government to fund loans to certain groups of borrowers, for example homeowners, farmers and students and are privately owned corporations with a public purpose. The most common GSEs are Federal Farm Credit System Banks, Federal Home Loan Banks, Federal Home Loan Mortgage Association, and Federal National Mortgage Association. AMORTIZATION: Accounting procedure that gradually reduces the cost value of a limited life or intangible asset through periodic charges to income. For fixed assets, the term used is depreciation. It is common practice to amortize any premium over par value paid in the purchase of preferred stock or bond investments. APPRECIATION: Increase in the value of an asset such as a stock bond, commodity or real estate. ASKED PRICE: The price a broker/dealer offers to sell securities. ASSET BACKED: A type of security that is secured by receivables, such as credit card and auto loans. These securities typically pay principal and interest monthly. BANKERS' ACCEPTANCE (BA): A draft or bill or exchange accepted by a bank or trust company. The accepting institution guarantees payment of the bill, as well as the issuer. This money market instrument is used to finance international trade. BASIS POINT: One-hundredth of one percent (i.e., 0.01%). BENCHMARK: A comparative base for measuring the performance or risk tolerance of the investment portfolio. A benchmark should represent a close correlation to the level of risk and the average duration of the portfolio s investment. BID PRICE: The price a broker/dealer offers to purchase securities. BOND: A financial obligation for which the issuers promises to pay the bondholder a specified stream of future cash flows, including periodic interest payments and a principal repayment. BOOK VALUE: The value at which a debt security is shown on the holder s balance sheet. Book value is acquisition cost less amortization of premium or accretion of discount. 13

125 Investment Policy No. XXX BROKER: A broker acts as an intermediary between a buyer and seller for a commission and does not trade for his/her own risk and account or inventory. CALLABLE SECURITIES: A security that can be redeemed by the issuer before the scheduled maturity date. CASH EQUIVALENTS (CE): Highly liquid and safe instruments or investments that can be converted into cash immediately. Examples include bank accounts, money market funds, and Treasury bills. CASH FLOW: An analysis of all changes that affect the cash account during a specified period. CERTIFICATE OF DEPOSIT (CD): A time deposit with a specific maturity evidenced by a certificate. Large-denomination CD's are typically negotiable. COLLATERAL: Securities, evidence of deposit or other property which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies. COLLATERALIZED MORTGAGE OBLIGATION (CMO): A type of mortgagebacked security that creates separate pools of pass-through rates for different classes of bondholders with varying maturities, called trances. The repayments from the pool of passthrough securities are used to retire the bonds in the order specified by the bonds' prospectus. COMMERCIAL PAPER: Short-term, unsecured, negotiable promissory notes of corporations. COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR): The official annual financial report for the Agency. It includes combined statements and basic financial statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP). CORPORATE NOTE: Debt instrument issued by a private corporation. COUPON: The annual rate at which a bond pays interest. CREDIT RATINGS: A grade given to a debt instrument that indicates its credit quality. Private independent rating services such as Standard & Poor's, Moody's and Fitch provide these CREDIT RISK: The risk that an obligation will not be paid and a loss will result due to a failure of the issuer of a security. 14

126 Investment Policy No. XXX CUSIP: Stands for Committee on Uniform Securities Identification Procedures. A CUSIP number identifies most securities, including: stocks of all registered U.S. and Canadian companies, and U.S. government and municipal bonds. The CUSIP system owned by the American Bankers Association and operated by Standard & Poor s facilitates the clearing and settlement process of securities. The number consists of nine characters (including letters and numbers) that uniquely identify a company or issuer and the type of security. CURRENT YIELD: The annual interest on an investment divided by the current market value. Since the calculation relies on the current market value rather than the investor s cost, current yield is unrelated to the actual return the investor will earn if the security is held to maturity. CUSTODIAN: A bank or other financial institution that keeps custody of stock certificates and other assets. DEALER: A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his/her own risk and account or inventory. DEBENTURES: A bond secured only by the general credit of the issuers. DELIVERY VERSUS PAYMENT (DVP): Delivery of securities with a simultaneous exchange of money for the securities. DERIVATIVES: A financial instrument that is based on, or derived from, some underlying asset, reference date, or index. DIRECT ISSUER: Issuer markets its own paper directly to the investor without use of an intermediary. DISCOUNT: The difference between the cost of a security and its value at maturity when quoted at lower than face value. DIVERSIFICATION: Dividing investment funds among a variety of securities offering independent returns and risk profiles. DURATION: A measure of the timing of the cash flows, such as the interest payments and the principal repayment, to be received from a given fixed-income security. This calculation is based on three variables: term to maturity, coupon rate, and yield to maturity. Duration measures the price sensitivity of a bond to changes in interest rates. FACE VALUE: The principal amount owed on a debt instrument. It is the amount on which interest is computed and represents the amount that the issuer promises to pay at maturity. 15

127 Investment Policy No. XXX FAIR VALUE: The amount at which a security could be exchanged between willing parties, other than in a forced or liquidation sale. If a market price is available, the fair value is equal to the market value. FANNIE MAE: Trade name for the Federal National Mortgage Association (FNMA), a U.S. Government sponsored enterprise. FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC): A federal agency that provides insurance on bank deposits, guaranteeing deposits to a set limit per account, currently $250,000. FEDERAL FARM CREDIT BANK (FFCB): Government-sponsored enterprise that consolidates the financing activities of the Federal Land Banks, the Federal Intermediate Credit Banks and the Banks for Cooperatives. Its securities do not carry direct U.S. government guarantees. FEDERAL FUNDS RATE: The rate of interest at which Federal funds are traded. This rate is considered to be the most sensitive indicator of the direction of interest rates, as it is currently pegged by the Federal Reserve through open-market operations. FEDERAL GOVERNMENT AGENCY SECURITIES: Federal Agency or United States government-sponsored enterprise obligations, participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or United States government-sponsored enterprises. FEDERAL HOME LOAN BANKS (FHLB): Government sponsored enterprise (currently made up of 12 regional banks) that regulates and lends funds and provides correspondent banking services to member commercial banks, thrift institutions, credit unions and insurance companies. Although the banks operate under federal charter with government supervision, the securities are not guaranteed by the U. S. Government. FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC): Government sponsored enterprise that helps maintain the availability of mortgage credit for residential housing. FHLMC finances these operations by marketing guaranteed mortgage certificates and mortgage participation certificates. Its discount notes and bonds do not carry direct U.S. government guarantees. FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA): Government sponsored enterprise that is the largest single provider of residential mortgage funds in the United States. FNMA is a private stockholder-owned corporation. The corporation's purchases include a variety of adjustable mortgages and second loans, in addition to fixed-rate mortgages. FNMA's securities are also highly liquid and are widely accepted. 16

128 Investment Policy No. XXX FEDERAL OPEN MARKET COMMITTEE (FOMC): A committee of the Federal Reserve Board, which establishes monetary policy and executes it through temporary and permanent changes to the supply of bank reserves. FEDERAL RESERVE SYSTEM: The central bank of the U.S. which consists of a seven member Board of Governors, 12 regional banks and about 5,700 commercial banks that are members. FED WIRE: A wire transmission service established by the Federal Reserve Bank to facilitate the transfer of funds through debits and credits of funds between participants within the Fed system. FREDDIE MAC: Trade name for the Federal Home Loan Mortgage Corporation (FHLMC), a U.S. government sponsored enterprise. GINNIE MAE: Trade name for the Government National Mortgage Association (GNMA), a direct obligation bearing the full faith and credit of the U.S. Government. GOVERNMENT ACCOUNTING STANDARDS BOARD (GASB): A standard-setting body, associated with the Financial Accounting Foundation, which prescribes standard accounting practices for governmental units. GUARANTEED INVESTMENT CONTRACTS (GICS): An agreement acknowledging receipt of funds, for deposit, specifying terms for withdrawal, and guaranteeing a rate of interest to be paid. INTEREST RATE: The annual yield earned on an investment, expressed as a percentage. INTEREST RATE RISK: The risk of gain or loss in market values of securities due to changes in interest-rate levels. For example, rising interest rates will cause the market value of portfolio securities to decline. INVESTMENT AGREEMENTS: A contract providing for the lending of issuer funds to a financial institution which agrees to repay the funds with interest under predetermined specifications. INVESTMENT GRADE (LONG TERM RATINGS): The minimum, high quality ratings for long term debt such as corporate notes. Investment Grade ratings are as follows: A3 (Moody s), A- (S&P), and A- (Fitch). INVESTMENT PORTFOLIO: A collection of securities held by a bank, individual, institution or government agency for investment purposes. 17

129 Investment Policy No. XXX LIQUIDITY: A liquid asset is one that can be converted easily and rapidly into cash with minimum risk of principal. LOCAL AGENCY INVESTMENT FUND (LAIF): An investment pool sponsored by the State of California and administered/managed by the State Treasurer. Local government units, with consent of the governing body of that agency, may voluntarily deposit surplus funds for the purpose of investment. Interest earned is distributed by the State Controller to the participating governmental agencies on a quarterly basis. LOCAL AGENCY INVESTMENT POOL: A pooled investment vehicle sponsored by a local agency or a group of local agencies for use by other local agencies. MARKET RISK: The risk that the value of securities will fluctuate with changes in overall market conditions or interest rates. Systematic risk of a security that is common to all securities of the same general class (stocks, bonds, notes, money market instruments) and cannot be eliminated by diversification (which may be used to eliminate non-systematic risk). MARKET VALUE: The price at which a security is currently being sold in the market. See FAIR VALUE. MASTER REPURCHASE AGREEMENT: A written contract covering all future transactions between the parties to repurchase agreements and reverse repurchase agreements that establish each party's rights in the transactions. A master agreement will often specify, among other things, the right of the buyer-lender to liquidate the underlying securities in the event of default by the seller-borrower. MATURITY: The date that the principal or stated value of a debt instrument becomes due and payable. MEDIUM-TERM CORPORATE NOTES (MTNs): Unsecured, investment-grade senior debt securities of major corporations which are sold in relatively small amounts either on a continuous or an intermittent basis. MTNs are highly flexible debt instruments that can be structured to respond to market opportunities or to investor preferences. MODIFIED DURATION: The percent change in price for a 100 basis point change in yields. This is a measure of a portfolio s or security s exposure to market risk. MONEY MARKET: The market in which short term debt instruments (Treasury Bills, Discount Notes, Commercial Paper, Banker s Acceptances and Negotiable Certificates of Deposit) are issued and traded. MORTGAGED BACKED SECURITIES: A type of security that is secured by a mortgage or collection of mortgages. These securities typically pay principal and interest monthly. 18

130 Investment Policy No. XXX MUNICIPAL BONDS: Debt obligations issued by states and local governments and their agencies, including cities, counties, government retirement plans, school Agencies, state universities, sewer agency, municipally owned utilities and authorities running bridges, airports and other transportation facilities MUTUAL FUND: An entity that pools money and can invest in a variety of securities which are specifically defined in the fund s prospectus. NEGOTIABLE CERTIFICATE OF DEPOSIT: A large denomination certificate of deposit which can be sold in the open market prior to maturity. NET PORTFOLIO YIELD: Calculation in which the 365-day basis equals the annualized percentage of the sum of all Net Earnings during the period divided by the sum of all Average Daily Portfolio Balances. NATIONALLY RECOGNIZED RATING ORGANIZATION (NRSRO): is a credit rating agency that issues credit rating that U.S Securities and Exchange Commission permits other financial firms to use for certain regulatory purposes. OPEN MARKET OPERATIONS: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank as directed by the FOMC in order to influence the volume of money and credit in the economy. Purchases inject reserves into the bank system and stimulate growth of money and credit: Sales have the opposite effect. Open market operations are the Federal Reserve's most important and most flexible monetary policy tool. PAR VALUE: The amount of principal which must be paid at maturity. Also referred to as the face amount of a bond. See FACE VALUE. PORTFOLIO: The collection of securities held by an individual or institution. PREMIUM: The difference between the par value of a bond and the cost of the bond, when the cost is above par. PRIMARY DEALER: A group of government securities dealers who submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to its informal oversight. These dealers are authorized to buy and sell government securities in direct dealing with the Federal Reserve Bank of New York in its execution of market operations to carry out U.S. monetary policy. Such dealers must be qualified in terms of reputation, capacity, and adequacy of staff and facilities. PRIME (SHORT TERM RATING): High quality ratings for short term debt such as commercial paper. Prime ratings are as follows: P1 (Moody s), A1 (S&P), and F1 (Fitch). 19

131 Investment Policy No. XXX PRINCIPAL: The face value or par value of a debt instrument, or the amount of capital invested in a given security. PRIVATE PLACEMENTS: Securities that do not have to be registered with the Securities and Exchange Commission because they are offered to a limited number of sophisticated investors. PROSPECTUS: A legal document that must be provided to any prospective purchaser of a new securities offering registered with the Securities and Exchange Commission that typically includes information on the issuer, the issuer s business, the proposed use of proceeds, the experience of the issuer s management, and certain certified financial statements (also known as an official statement ). PRUDENT INVESTOR STANDARD: A standard of conduct for fiduciaries. Investments shall be made with judgment and care--under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. PUBLIC DEPOSIT: A bank that is qualified under California law to accept a deposit of public funds. PURCHASE DATE: The date in which a security is purchased for settlement on that or a later date. Also known as the trade date. RATE OF RETURN: 1) The yield which can be attained on a security based on its purchase price or its current market price. 2) Income earned on an investment, expressed as a percentage of the cost of the investment. REALIZED GAIN (OR LOSS): Gain or loss resulting from the sale or disposal of a security. REGIONAL DEALER: A financial intermediary that buys and sells securities for the benefit of its customers without maintaining substantial inventories of securities and that is not a primary dealer. REPURCHASE AGREEMENT (RP or REPO): A transaction in which a counterparty or the holder of securities (e.g. investment dealer) sells these securities to an investor (e.g. the Agency) with a simultaneous agreement to repurchase them at a fixed date. The security "buyer" (e.g. the Agency) in effect lends the "seller" money for the period of the agreement, and the terms of the agreement are structured to compensate the buyer for this. Dealers use RP extensively to finance their positions. Exception: When the Fed is said to be doing RP, it is lending money that is, increasing bank reserves. 20

132 Investment Policy No. XXX REVERSE REPURCHASE AGREEMENT (REVERSE REPO): The opposite of a repurchase agreement. A reverse repo is a transaction in which the Agency sells securities to a counterparty (e.g. investment dealer) and agrees to repurchase the securities from the counterparty at a fixed date. The counterparty in effect lends the seller (e.g. the Agency) money for the period of the agreement with terms of the agreement structured to compensate the buyer. RISK: Degree of uncertainty of return on an asset. SAFEKEEPING: A service which banks offer to clients for a fee, where physical securities are held in the bank s vault for protection and book-entry securities are on record with the Federal Reserve Bank or Depository Trust Company in the bank s name for the benefit of the client. As agent for the client, the safekeeping bank settles securities transactions, collects coupon payments, and redeems securities at maturity or on call date, if called. SECURITIES AND EXCHANGE COMMISSION (SEC): Agency created by Congress to protect investors in securities transactions by administering securities legislation. SECONDARY MARKET: A market for the repurchase and resale of outstanding issues following the initial distribution. SECURITIES: Investment instruments such as notes, bonds, stocks, money market instruments and other instruments of indebtedness or equity. SETTLEMENT DATE: The date on which a trade is cleared by delivery of securities against funds. SPREAD: The difference between two figures or percentages. It may be the difference between the bid (price at which a prospective buyer offers to pay) and asked (price at which an owner offers to sell) prices of a quote, or between the amount paid when bought and the amount received when sold. STRUCTURED NOTE: A complex, fixed income instrument, which pays interest, based on a formula tied to other interest rates, commodities or indices. Examples include inverse floating rate notes which have coupons that increase when other interest rates are falling, and which fall when other interest rates are rising and dual index floaters, which pay interest based on the relationship between two other interest rates, for example, the yield on the ten-year Treasury note minus the Libor rate. Issuers of such notes lock in a reduced cost of borrowing by purchasing interest rate swap agreements. SUPRANATIONALS: are international institutions that provide development financing, advisory services and/or financial services to their member countries to achieve the overall goal of improving living standards through sustainable economic growth. The Government Code allows local agencies to purchase the United States dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for 21

133 Investment Policy No. XXX Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank. TIME DEPOSIT: A deposit with a California bank or savings and loan association for a specific amount and with a specific maturity date and interest rate. Deposits of up to $250,000 are insured by FDIC. Deposits over $250,000 are collateralized above the insurance with either government securities (at 110% of par value), first trust deeds (at 150% of par value), or letters of credit (at 105% of par value). TOTAL RATE OF RETURN: A measure of a portfolio s performance over time. It is the internal rate of return which equates the beginning value of the portfolio with the ending value, and includes interest earnings and realized and unrealized gains and losses on the portfolio. For bonds held to maturity, total return is the yield to maturity. TRUSTEE OR TRUST COMPANY OR TRUST DEPARTMENT OF A BANK: A financial institution with trust powers which acts in a fiduciary capacity for the benefit of the bondholders in enforcing the terms of the bond contract. UNDERWRITER: A dealer which purchases a new issue of municipal securities for resale. UNIFORM NET CAPITAL RULE: Securities and Exchange Commission requirement that member firms as well as nonmember broker/dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1; also called net capital rule and net capital ratio. Indebtedness covers all money owed to a firm, including margin loans and commitments to purchase securities, one reason new public issues are spread among members of underwriting syndicates. Liquid capital includes cash and assets easily converted into cash. U.S. GOVERNMENT AGENCY SECURITIES: Securities issued by U.S. government agencies, most of which are secured only by the credit worthiness of the particular agency. See AGENCIES. U.S. TREASURY OBLIGATIONS: Securities issued by the U.S. Treasury and backed by the full faith and credit of the United States. Treasuries are the benchmark for interest rates on all other securities in the U.S. The Treasury issues both discounted securities and fixed coupon notes and bonds. The income from Treasury securities is exempt from state and local, but not federal, taxes. TREASURY BILLS: Securities issued at a discount with initial maturities of one year or less. The Treasury currently issues three-month and six-month Treasury bills at regular weekly auctions. It also issues very short-term cash management bills as needed to smooth out cash flows. TREASURY NOTES: Intermediate-term coupon-bearing securities with initial maturities of one year to ten years. 22

134 Investment Policy No. XXX TREASURY BOND:Long-term coupon-bearing securities with initial maturities of ten years or longer. UNREALIZED GAIN (OR LOSS): Gain or loss that has not become actual. It becomes a realized gain (or loss) when the security in which there is a gain or loss is actually sold. See REALIZED GAIN (OR LOSS). VOLATILITY: Characteristic of a security, commodity or market to rise or fall sharply in price within a short-term period. WEIGHTED AVERAGE MATURITY: The average maturity of all the securities that comprise a portfolio that is typically expressed in days or years. YIELD: The annual rate of return on an investment expressed as a percentage of the investment. See CURRENT YIELD; YIELD TO MATURITY. YIELD CURVE: Graph showing the relationship at a given point in time between yields and maturity for bonds that are identical in every way except maturity. YIELD TO MATURITY: Concept used to determine the rate of return if an investment is held to maturity. It takes into account purchase price, redemption value, time to maturity, coupon yield, and the time between interest payments. It is the rate of income return on an investment, minus any premium or plus any discount, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond, expressed as a percentage. 23

135 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATIVE SERVICES CONTACT PERSON: Osborn Solitei AGENDA DATE: April 19, 2017 ITEM NO. 15 SUBJECT: Consider Action to Increase the Compensation of Zone 7 Board Members SUMMARY: Pursuant to the Zone 7 Board of Directors Compensation and Expense Reimbursement Policy adopted by the Board on March 15, 2006 and most recently amended June 20, 2012, a review of the Board s remuneration is conducted on a biennial basis. Attached are the results of the 2017 compensation survey of comparable water agencies board of directors. The Board s current compensation, effective July 1, 2015, is $ per meeting with a maximum of ten meetings per month. The annual Consumer Price Index (CPI) increase for the San Francisco-Oakland-San Jose area for 2014 was 2.8%, for 2015 was 2.6% and for 2016 was 3.0%. The mean compensation level of the agencies surveyed is $ per meeting. Based on these results, the Board may wish to consider the following options: o Option 1: maintain the compensation at the current $ per meeting. o Option 2: set the compensation for the fiscal year 2017/2018 and fiscal year 2018/2019 at the mean derived from the current market compensation salary survey ($178.81, an increase of approximately 1.45%). o Option 3: since the board has taken no increase since 2015, and per the Water Code Section 20200, et seq., 5% per year increase is allowed; up to 10% increase could be granted this year (up to $193.83). FUNDING: Funds are available in Fund 100 Water Enterprise and Fund 200 Flood Control. RECOMMENDATION: Discuss and direct staff to either: A) Schedule public hearing on May 17, 2017 to adopt an Ordinance to increase Board Compensation, or B) Consider taking no action; i.e., to adopt no increase for fiscal year 2017/2018 and fiscal year 2018/2019 and to conduct the next biennial review in ATTACHMENTS: Memo providing additional background and discussion.

136 MEMORANDUM DATE: March 30, 2017 TO: FROM: SUBJECT: Jill Duerig, General Manger Osborn Solitei, Assistant General Manager, Finance Consider Action to Increase the Compensation of Zone 7 Board Members SUMMARY: At the March 15, 2006 Board meeting the board adopted the Zone 7 Board of Directors Compensation and Expense Reimbursement Policy which provides for a review of the Board s remuneration on a biennial basis. Attached are the results of the 2017 compensation survey of comparable water agencies boards of directors. The Board s current compensation, effective July 1, 2015, is $ per meeting and the maximum number of meetings is ten meetings per month. Since the 2015 increase, the annual Consumer Price Index (CPI) increase for the Oakland-San Francisco-San Jose area for 2014 was 2.8%, for 2015 was 2.6% and for 2016 was 3.0%. The mean compensation level of the agencies surveyed is $ Based on these results, the Board may wish to consider the following options. Several options are available. One option is to maintain the compensation at the current level of $ per meeting. Another option is to set the compensation for fiscal year 2017/2018 and 2018/2019 at the mean derived from the current market compensation survey ($178.81, an increase of 1.45%). Another option the Board may consider is to take an increase of up to 10% given that an increase of up to 5% per year may be taken since the last increase which was in BACKGROUND: Water Code Section 20200, et seq., governs compensation levels for Zone 7 Board Members. The statute provides the directors can be paid $ per day of service rendered. If the Board members already make $ per day, the amount can be increased by an amount not to exceed 5% for each year following the last adjustment. The last adjustment took effect July 1, 2015, increasing the compensation by 10.14% to $ per day of service rendered. Based on the adoption of the Board s policy of reviewing the remuneration biennially for the Zone 7 Board, attached is the survey for the year Based on past practice, the Board has considered the mean of comparable water agencies as the benchmark for compensation. The following comparable water agencies were surveyed: Alameda County Water District Contra Costa Water District Dublin San Ramon Services District East Bay Municipal Utility District

137 Marin Municipal Water District Santa Clara Valley Water District Page one of the attached Board of Directors Compensation and Benefit Survey provides a summary listing each agency, director compensation amount per meeting, maximum number of compensated meetings per month, maximum compensation per month and the group benefits cost (minimum to maximum per month). The Survey also includes the mean for the agencies and a comparison to the compensation and benefits that are provided for the Zone 7 Board of Directors. Pages two through four of the Survey provide a more in-depth description of the total packages provided and any limitations. Although the survey data includes the monthly cost for group benefits provided to directors of each agency, under the Alameda County system, the Zone 7 Board of Directors are not currently eligible to receive medical or retirement benefits. DISCUSSION: In comparing the data surveyed for the year 2015 versus the current data the changes were primarily in the cost of group benefits. Three of the agencies made changes to their board compensation. East Bay Municipal Utility District increased their flat monthly payment from $1, to $1, Marin Municipal Water District increased their compensation from $ per meeting to $ per meeting. Santa Clara Valley Water District decreased their compensation from $ per meeting to $ per meeting. The mean for the agencies surveyed is $ per meeting. The annual Consumer Price Index (CPI) for the Oakland-San Francisco-San Jose area increase for 2014 was 2.8%, for 2015 was 2.6% and for 2016 was 3.0%. The maximum compensation increase allowed under Water Code Section is 5% per year. The mean of the agencies surveyed is $ Based on these results, the Board may consider setting the compensation at the mean for fiscal year 2017/2018 and 2018/2019, to $ per meeting. On the other hand, since the board has taken no increase since 2015, and the Water Code allows 5% per year increase, up to 10% increase could be adopted this year (up to $193.83). Under the above scenarios, the maximum increased cost for the 2-year period for fiscal year 2017/2018 and fiscal year 2018/2019 would be: No cost increase if compensation levels remain as is. $4, to bring the compensation to the mean (or $2, per year). $29, to increase the compensation up to 10% (or $14, per year). This estimate is based on all seven directors attending ten meetings each month of the year. Attachments: Board of Directors Compensation and Benefit Survey March 2017 Zone 7 Board of Directors Compensation and Expense Reimbursement Policy

138 BOARD OF DIRECTORS Page 1 COMPENSATION AND BENEFIT SURVEY March 2017 AGENCY AMOUNT PER MEETING MAXIMUM MEETINGS PER MONTH MAXIMUM COMPENSATION Per Month GROUP BENEFIT COSTS Minimum to Maximum per Month Alameda County Water District $ $1, $ to $2, Contra Costa Water District $ $1, $ to $2, Dublin San Ramon Services District $ $1, $ to $1, East Bay Municipal Utility District * $1, $ to $2, Marin Municipal Water District $ $2, $ to $1, Santa Clara Valley Water District $ $2, $ to $2, Mean $ $1, $ to $2, * Flat Rate Zone 7 $ $1, $0** ** No group benefits offered currently

139 BOARD OF DIRECTORS Page 2 COMPENSATION AND BENEFIT SURVEY March 2017 AGENCY GROUP BENEFITS COMPENSATION MAXIMUM COMPENSATION BUSINESS EXPENSE REIMBURSEMENT Alameda Not to exceed 8 meetings per month; County $1, per month Water District Medical: each Board of Director will contribute 0.25% of their per diem compensation toward the cost of their medical benefits. This contribution will increase annually by an additional 0.25% in 2015, 2016 and 2017, for a total of four (4) year contribution of 2.5%. Cost from: $ to $2,761.88/month $ for each Board or Committee meeting attended, conferences, seminars, workshops tours, and other Board authorized meetings and activities. Reimbursed for reasonable expenses (transportation, mileage, lodging, meals.) necessarily incurred while conducting District business. LIMITATION AUTHORIZATIONS Directors are reimbursed for any expenses incurred in the performance of his/her duties required or authorized by the Board. All activities for which expense reimbursement is sought must be approved in advance by the Board. Dental: Coverage is fully paid by the District: $ /month Vision: Coverage is fully paid by the District: $23.26/month Contra Costa Water District Dublin San Ramon Services District Health, Dental, Vision, EAP, Life $10, or $100, with Evidence of Good Health, Retirement District pays full cost of medical, dental, vision, EAP, and life premiums. Cost range from: $ to $2, month Health, Dental, Vision, AD&D $50,000 coverage, Life Insurance up to a maximum of $50,000. District pays full cost of dental, vision, AD&D, and life premiums. Dental premiums: $ $ Vision premiums: $ $29.13 AD&D premiums: $0.022 for $1,000 Life premiums: $0.143 per $1,000 $100.00/day for District activities, Board is compensated for service rendered as a Director at the request of the Board and for attendance at conferences (such as the semi-annual ACWA conferences) or for meetings with local government agencies, service organizations, or civil groups if: Invited to deliver a speech Serve as a panel member or Board approves participation in advance Not to exceed $1, per month. $ per meeting Not to exceed a total of 10 meetings per month; $1, per month Reimbursed for reasonable expenses (transportation, mileage, lodging, meals) necessarily incurred while conducting District business. Reimbursed for actual expenses for traveling to District related conferences, workshops and Board related business. Travel must be authorized in advance by Board. Approval by Board President for travel outside of 9 Bay Area counties. Mileage reimbursed outside 9 Bay Area counties. District pays up to the following amounts for Health premiums: $631 - $1,640/per month Board members are allowed to participate in the District s Deferred Comp Program with a 25% employer match up to $10 per calendar month, provided that the member contributes voluntarily at least $20 per month

140 BOARD OF DIRECTORS Page 3 COMPENSATION AND BENEFIT SURVEY March 2017 AGENCY GROUP BENEFITS COMPENSATION MAXIMUM COMPENSATION BUSINESS EXPENSE REIMBURSEMENT East Bay Municipal Utility District Marin Municipal Water District Health, dental, retirement, vision, 401(k)m 457 plans Dental and Vision premium is paid in full by District; Health premium is paid in full by District for Director and family; Health premium is paid in full Director but depending on plan could pay 15% of premium for family. Cost range from: $ to $2, (includes $905 annual District contribution i.e. supplemental benefit dollars ; excludes pension costs) Health, Dental, No Vision, No Retirement District pays full cost of dental and health premiums. Board Members share cost of health plan premiums for family members. Dental cost is $143.78/month. Cost range from: $ to $1, $1, per month * eff. 2/1/17 Salary (flat rate) $ per day of service * eff. 2/20/17 A Director must attend a minimum of three meetings per month (includes regular business meetings, standing committee meetings, special meetings, retirement board meetings, and closed session meetings). In the event a Director is assigned to attend less than 6 meetings of the Board in one month, he or she must attend a minimum of 50% of the assigned meetings. Board President may excuse a Director s absence from an assigned meeting. Not to exceed $ per day Or Compensation for more than 10 days of service in any calendar month: $2,000 per month Reimbursement for actual expenses that are incurred in the performance of duties authorized or requested by the Board Each Director is reimbursed for all reasonable Board authorized or requested expenses actually incurred in performance of duties LIMITATION AUTHORIZATIONS Salary not paid for any month in which minimum number of meetings are not attended, unless absence is excused by the Board President President of the Board authorizes expenses. Advance approval is required to: Attend conferences, seminars, or similar activities Travel to destinations in excess of 150 miles from District or for overnight lodging > 1 night. Any Board member attending meetings, workshops, conferences, e.g. ACWA, at the request of the Board, are compensated for costs incurred. Authorization for travel and expense reimbursement shall be limited to conferences, meetings and other functions from which the District derives a specific benefit through attendance. Only that travel/attendance which serves a District purpose and is deemed necessary and/or advantageous to the District shall be approved and reimbursed. Breakfast - $12 Lunch - $15 Dinner - $25 Elected or appointed officials may receive a meal allowance in excess of IRS regulations, but the meal allowance shall not exceed $52 per day, which includes taxes and tips.

141 BOARD OF DIRECTORS Page 4 COMPENSATION AND BENEFIT SURVEY March 2017 Santa Clara Valley Water District Medical, Dental, Vision Care, EAP, Life Insurance (equal to one times their annual maximum meeting per diem), Travel Accident Insurance (while traveling on district business) Optional: Personal Accident Insurance, Deferred Compensation 457 Plan ( no district matching) $ for each Board or committee meeting attended, conferences, seminars, workshops, tours and other Board authorized meetings and activities. Not to exceed 10 meetings per month; $2, per month. If the 10 meetings are exceeded, Board members are reimbursed for transportation, meals or any reasonable related expenses. Reimbursed for expenses incurred for conferences, travel, lodging and meals (reimbursement limit $2,500). Annual FY reimbursement limited to $250 per Director, for services, activities or pursuits in office as provided in Board policy. Cost range from: $ to $2,322.47/month 15% cost sharing on monthly premium for medical only; dental and vision remains free

142 BOARD OF DIRECTORS Page 5 COMPENSATION AND BENEFIT SURVEY March 2017 AGENCY GROUP BENEFITS COMPENSATION MAXIMUM COMPENSATION BUSINESS EXPENSE REIMBURSEMENT Zone 7 None $ per day for each day s attendance at meetings of the Board, or for each day s attendance at regular, special and/or committee meetings of the Board and for each day s service eligible for compensation pursuant to Section B of the Zone 7 Board of Directors Compensation and Expense Reimbursement Policy. Not to exceed 10 days in any month: $1, per month. Reimbursed for actual and necessary travel expenses in performance of agency business. LIMITATION AUTHORIZATIONS Transportation expenses within Bay Area counties limited to mileage, public transit fares, parking and bridge tolls unless Board specifically authorizes other. Outside the Bay Area, if private vehicle is used, payment may not exceed the economy or coach round trip airfare.

143 Zone 7 Board of Directors Compensation and Expense Reimbursement Policy (amended November 15, 2006; March 16, 2011; June 20, 2012) The members of the Board of Directors will fully comply with the provisions of the following "Policy on Directors' Compensation and Expense Reimbursement." A. Compensation for Attendance at Zone 7 Meetings: Board Members will be compensated at the rate determined by the Board consistent with applicable law for attendance at regular and special meetings of the Board, including Board committee meetings and for attendance at biennial AB 1234 required ethics training courses approved by the Fair Political Practices Commission & Attorney General s Office. B. Compensation for Attendance at Non-Zone 7 Meetings: Each member of the Board of Directors is encouraged to participate in those outside activities and organizations which in the judgment of the Board further the interests of Zone 7. Board Members may request compensation for attending non-zone 7 Board meetings, events or activities, including conferences and organized educational programs, pursuant to the following procedure: 1. Prior to attendance at a non-zone 7 sponsored meeting, event or activity, Board Members shall submit his/her request for compensation for such attendance. 2. Requests for compensation shall be included as an agendized matter for Board consideration at the next regularly scheduled public meeting of the Board of Directors. 3. Board Members shall provide to the General Manager or his designee, the Member s request for compensation no later than ten (10) days prior to the regularly scheduled Zone 7 Board of Directors public meeting at which the Member s request is to be considered by the full Board. 4. Board Members request shall, at a minimum, include the following information: i. a description of the meeting, event or activity ii. iii. iv. the host/sponsor of the meeting, event or activity the date, time & place purpose of attendance

144 5. The General Manager shall prepare an Agenda Item to reflect the Board Member s request for compensation and place it on the agenda of the scheduled meeting of the Board of Directors at which the request will be considered. 6. When considering requests for compensation by Board Member(s), the Board of Directors shall take into account whether the Member s attendance is in furtherance of rendering service to Zone 7 and is clearly relevant to Zone 7 Activities. 7. Compensation for attendance at non-zone 7 meetings, events or activities, shall only be permitted upon approval of the Board of Directors in conformity with this policy and procedure. 8. Notwithstanding other sections of this Policy, Board Member compensation for attendance at Zone 7 Board Meetings and approved non-zone 7 Board meetings, events or activities, shall not be paid for more than a total of ten (10) days per Director in any calendar month. C. Amount of Compensation for Attendance: The amount of compensation to Board Members for attendance at each meeting, event and activity authorized pursuant to Sections A & B above, shall be reviewed on a biennial basis. The amount of compensation shall be established in accordance with the provisions of Water Code Section 20200, et seq., and shall be adopted by ordinance. Board members will be compensated for attendance at each board-approved meeting, event and activity. D. Reimbursement of Actual and Necessary Board Member Expenses: Board Members shall be entitled to reimbursement for meals, lodging and travel expenses incurred to attend a meeting, event or activity approved by the Board of Directors pursuant to Section B above; provided, however, no compensation will be paid to any Board Member unless an expense report has been submitted by that Board Member, as provided below. Note that the board approves a total travel budget for all directors (rather than for individual directors) each year as part of the final budget approval process. Notwithstanding the foregoing, reimbursement of Actual and Necessary Expenses incurred by Board Members in connection with attendance at the following conference(s)/course(s) shall be permitted without prior Board approval: a) Association of California Water Agency (ACWA) Conferences one time per calendar year. b) Biennial Fair Political Practices Commissions & Attorney General approved Ethics training courses in connection with AB 1234 required ethics training. 1. General Rules Applicable to Directors Expenses: i. All expenses will be reasonable and necessary and Directors are encouraged to exercise restraint in all expenditures.

145 ii. iii. iv. Government and group rates shall be used when offered by a provider of transportation or lodging services for travel and lodging when available. In the event a more expensive class of transportation is used, the reimbursable amount will be limited to the cost of the most economical class of transportation available. Reimbursement for use of personal autos will be at the applicable County of Alameda Auditor-Controller approved rate. Expenditures for food and lodging will be moderate and reasonable and in accordance with District policy. The policy is intended to result in no personal gain or loss to a Director. 2. Transportation Expenses: Subject to this provision, Directors will be reimbursed for all expenses consistent with Paragraph 1 above, incurred in traveling to and from conferences, meetings and other events which are attended on behalf of the District in their capacity as Directors. Travel expenses will include round-trip air fare, actual expenses for ground transportation to and from airports and hotels, car rental, and or mileage reimbursement (at the maximum allowable per mile rate established from time to time by the County of Alameda Auditor-Controller) for use by Directors of privately-owned vehicles in the conduct of District business. Reimbursement for public transportation, parking and bridge tolls is based on the submission of receipts attached to the expense report, except that receipts are not required for metered parking (which should be designated on the claim). 3. Overnight Accommodations: i. Lodging costs are allowable if the time of the conference and the distance traveled justify the overnight stay. No reimbursement claim or request for overnight accommodations will be approved for expenses incurred within the District's service area, except upon approval of the Board. ii. If lodging is in connection with a conference or organized educational activity, lodging costs shall not exceed the maximum group rate published by the conference or activity sponsor, provided that lodging at the group rate is available to the Board Member at the time of booking. If the group rate is not available, the Board Member shall use comparable lodging. iii. Alcoholic beverages and other non-essential expenses (including, but not limited to, in-room movies, Service Bar, health club fees, etc.) will not be reimbursed. iv. Where reasonably possible, accommodations will be obtained in proximity to the conference or meeting site. v. Reimbursement for lodging costs requires a copy of the hotel statement and proof of payment.

146 4. Meal Expenses: Directors will be entitled to receive reimbursement for actual cost of meals exclusive of alcoholic beverages consistent with Paragraph 1 above and subject to the following: Meals may be reimbursed in one of the following ways: 5. Registration Fees: a) If receipts are provided with the expense reimbursement claim for all meals, the actual cost of each meal (within reason), tax and tip shall be reimbursed. b) If receipts are not provided for all meals, the reimbursement amount is the lesser of actual cost or the flat rate for actual meal expense rates established by the Alameda County Auditor-Controller and is subject to the following individual limits in effect as of July 1, 2007 or at the limits as may be subsequently adjusted by the County Auditor-Controller, whichever is higher: Breakfast $11.00 Lunch $16.00 Dinner $29.00 Maximum Daily Rates: All Meals $56.00 Tips for meals (with receipts) will be reimbursed. Tips are reimbursed for reasonable amounts in accordance with community standards (currently 15%) and must be shown on the receipt. Tips for taxi service, porters and other services not directly connected to meals are not reimbursable. NOTE: The maximum flat-rate reimbursement per day for meals of $56.00 is not a per diem. To be reimbursed, the claimed meal must be purchased. If less than three meals in the day are purchased, the claim may not exceed the maximum amount reimbursable for those meals. Normally, only lunch would be reimbursed for a day conference. For conferences and seminars, the Board Member claimant must provide a copy of the program announcement, agenda and registration form, showing the conference location, dates, times, activities, costs and any lodging or meals included in the registration fee. E. Reimbursement Procedure: All requests for reimbursement for actual and necessary expenses incurred on behalf of the District in the performance of official duties shall be submitted to the District's General Manager (or his designee) within 45 days after the expenses were incurred or expenditures

147 made, unless circumstances warrant otherwise. Requests for reimbursement or accountings will be submitted, on expense report forms provided by the Alameda County Auditor- Controller s Office, and will be accompanied by receipts evidencing each expense or other documentation deemed satisfactory by the County Auditor-Controller. All out-of-pocket expenses must be supported by proof of payment (i.e., cash receipts, money orders, credit card charge slips, cancelled checks or copy of the bank statement showing the posted payment). F. Board Member Reports: Members of the Board of Directors shall provide brief written reports or presentations (less than five minutes) on meetings, events or activities attended at the expense of the District at the next regular Board of Directors meeting. Ideally, such reports should contain a summary of meetings attended and specific lessons learned with appropriate references so that additional information on selected topics can be obtained by other directors and staff, so that others who have not attended will be able to have access to the information made available during the meeting, event or activity. G. Pre- Approval Exception: Notwithstanding anything to the contrary contained herein, in the event there is insufficient time to comply with the pre-approval process for attendance at non-zone 7 sponsored activities as set forth Section B of this Policy because Directors do not receive timely notice from the activity sponsor or as a result of circumstances reasonably beyond their control, Directors may choose to attend and seek the Board s approval thereafter. After such attendance, Directors shall at the next regularly scheduled meeting of the Board, request Board approval for compensation and/or reimbursement in conformity with the procedure set forth in Section B (3) through (6) herein together with a detailed explanation as to why timely compliance with the pre-approval process was not feasible. The Board shall have the right to reject any post-attendance request for approval if the failure to obtain pre-attendance approval results from a Director s own negligence or willful failure to timely submit his/her request.

148 ITEM NO.: 16 ZONE 7 BOARD OF DIRECTORS WATER RESOURCES COMMITTEE Summary Notes Tuesday, April 11, 2017 Directors Present: Vice President John Greci Director Sarah Palmer Director Sandy Figuers (arrived at 11:20 a.m.) Staff Present: Jill Duerig, Carol Mahoney and Amparo Flores Vice President Greci called the meeting to order at 11:04 a.m. 1. Public Comment on Items Not on Agenda There were no public comments. 2. Update on Lake Del Valle Feasibility Study and Prop 1 Funding Opportunities Amparo Flores provided a presentation on the status of the Lake Del Valle Storage Expansion Study, overview of the Proposition 1 grant funding process, and staff recommendations. David Ford Consulting Engineers has completed an internal draft report for the FIRO and Storage Reallocation Study. The analysis is based on historical hydrology between November 1969 to September 2015 and includes up to a 25-year storm event and a modeled maximum lake inflow of 8,200 cfs (note that a 100-yr event is estimated to be much higher at 18,700 cfs). The study also uses current water supply operational patterns and USACE Water Control Manual flood operation rules. The alternatives evaluated include: 1) FIRO; 2) FIRO and 5,000 to 25,500 AF of flood storage reallocated to water supply (i.e., flood storage decreases from 37,000 AF to 11,500-32,000 AF); and 3) FIRO and structural modification to add 5,000 AF of additional water storage space. The metrics evaluate water supply availability (e.g., storage levels in the lake), flood management (e.g., maximum downstream flows), recreational facility impacts (e.g., reservoir elevations) for the different scenarios. The FIRO and Storage Reallocation Study finds that storage reallocation or structural modification alternatives have the potential to enhance water supply storage, but will require relocation of EBRPD facilities to avoid recreational impacts. Based on the modeled period, flood management may be largely unaffected compared to baseline operations 99% of the time; however, storage reallocation increases the frequency and magnitude of high flood release rates from the reservoir (>2,000 cfs) and could exacerbate downstream erosion issues. Because this study focuses largely on water supply, the extent of impacts to flood management would need to be further evaluated before pursuing such a project. 1

149 ITEM NO.: 16 Based on the results of the study and the following concerns, staff does not support reallocating flood storage to water supply storage: The water agencies do not own nor operate the lake. The recent flood events illustrate the need for substantial flood storage in Lake Del Valle; therefore, it does not make sense to reduce that storage and convert it to water supply storage. Making substantial changes to Lake Del Valle s operations could negatively affect Zone 7 s (and ACWD s) existing water rights. Zone 7 is currently expending significant resources to evaluate other storage options (Sites Reservoir and Los Vaqueros Expansion) that have a much higher potential benefit and would be competing for the same pot of Prop 1 money. KSN Engineers has completed a draft preliminary engineering study to modify or relocate recreation facilities that could be rendered unavailable if lake levels are drawn down below the current minimum, which is another way of increasing the available operational storage for water supply. A draft technical memorandum from KSN is currently under review. As indicated on Figure 2, water supply operational storage is currently limited to 15,000 AF (from 680 to 703 ) because of the locations of the EBRPD water supply intake and other facilities. The KSN study evaluated modification of these facilities to allow the water level (i.e., Bottom of Conservation Pool) to drop to 675 and 650, making up to 11,000 AF of deadpool available (total operational storage increased up to 26,000 AF). The rough estimates of capital costs range from $3 to $10.5M but this would have to be fully vetted and CEQA analyses would have to be done. Staff believes lowering the lake s operational level is technically feasible; however, this would require coordination with and concurrence from DWR and EBRPD. This may enhance the capture of local water but may have water quality impacts. The high level feasibility analyses did not get into this level of detail. Proposition 1 (Water Quality, Supply, and Infrastructure Improvement Act of 2014) made $2.7 billion available for storage projects under the Water Storage Investment Program (WSIP). The grant application process is rigorous and applications are due on August 14, Consultant estimates for completing the WSIP application ranges from $260 to 800K (assuming all three water agencies participate, Zone 7 s share would be $90K-300K). The process is very competitive with larger and more established (initial designs and CEQA are either complete or well underway), such as Sites Reservoir and Los Vaqueros Expansion, seeking funding. Note that Zone 7 is investing in those two projects, as well. Staff are not recommending that we move forward with the costs associated with preparing a grant application at this time, given the high costs of preparing the application and the unlikelihood of being awarded a grant. Dr. Flores additionally provided information regarding recent Zone 7 flood inspections on the Arroyo Valle and pointed out that the releases from the lake had been up to 1,200 cfs. These flows comingled with natural runoff and resulted in at least four bank slides along the arroyo and hundreds of downed trees and log jams along the channel. 2

150 ITEM NO.: 16 Director Palmer suggested that homes should not be allowed to be built along properties abutting the Valley s natural streams due to the dynamic nature of the flows and the erosion issues. With respect to the options presented, Director Palmer inquired if lowering the park s water intake was less expensive than the others and Dr. Flores replied that it was. Ms. Duerig pointed out that EBRPD has not contributed funding to the effort thus far, nor have they indicated that they are interested in doing so. DWR is also not a funding partner, although they own the lake and operate many of the other water facilities at the lake. Director Palmer also noted the significant rise in water surface elevation that would occur in a short period of time as natural inflow enters the lake during a 100-year event. Director Palmer asked if the analysis included more frequent atmospheric rivers and Dr. Flores indicated that if FIRO is implemented, this would be taken into account. Vice President Greci asked if Zone 7 currently has the ability to pull from various depths within Lake Del Valle to address changes in water temperature and/or water quality and staff explained that this is already the case. With respect to the Prop 1 grant proposal, Director Palmer inquired if, in addition to the contemplated Lake Del Valle grant proposal, Sites and Los Vaqueros reservoirs also planned to apply for Prop 1 funding and staff clarified that all of these would be in competition for Prop 1 funds. Vice President Greci commented that the competitive nature of the grant, the fact that DWR owns Lake Del Valle and not the parties requesting the grant funds, and none of the facilities are owned or operated by Zone 7, we could put a lot of money toward a grant proposal and still not be allowed to do a project even if the grant were awarded. He further stated that it did not appear that Zone 7 would get that much benefit at this time from expending additional funding or staff time, but was glad that the agency showed good due diligence in exploring the options. Director Palmer asked who the other participants in the grant would be and staff replied that it was anticipated to be SCVWD and ACWD, but that SCVWD had only recently approved participating in the studies that are nearly completed and that Zone 7 approved in September Also, staff advised that the ACWD Board would be considering next steps later in the day. Board members inquired about how DWR views and operates the lake and the likelihood of Zone 7 and the other contractors being successful at facilitating a project. David Aladjem explained that DWR operates Lake Del Valle as a small holding facility for water supply and not as an active reservoir. The FIRO analysis looks at what would be necessary to change operations to more of an active water supply reservoir. DWR would have to agree to this change in operation and USACE would have to modify the permit. Ms. Duerig pointed out that DWR is exploring FIRO operational changes at other larger reservoirs, but that the small scale of Lake Del Valle makes it unlikely to receive much attention. Director Figuers noted that impacts to recreation are the main drawback for doing anything, but did think that it would be useful to draw down the dead pool in the summer. Director Palmer suggested that Zone 7 provide the data we have developed to EBRPD to see if they would like to 3

151 4 ITEM NO.: 16 facilitate any of these projects in the future. Ms. Duerig stated that they are aware of the results and have been informed throughout the process. Ms. Duerig also pointed out that staff could schedule a Liaison Committee meeting to discuss further. She added that staff could bring an item to the full board to provide feedback. Director Palmer stated that she agrees with Vice President Greci that we should not continue funding this effort at this time in light of the fact that funding is not in the budget for this effort, and that this is competing with other more beneficial projects. Director Figuers inquired if, in the event of an emergency, the dead pool can be accessed and Ms. Duerig pointed out that, although this is possible, it is also challenging due to a complicated lease agreement between the State Lands Commission and EBRPD that gives priority to water in the lake for recreation during the summer months. Certain drought conditions must be met prior to drawing the lake down. Director Figuers suggested that a discussion with DWR and EBRPD regarding operations would be more beneficial than moving facilities. Vice President Greci suggested bringing an item forward to the full board for consideration but clearly stating that the Committee supports staff s recommendation to not pursue grant funding at this time. The other Committee members agreed. 3. Status of SGMA MOU for Tracy Subbasin Ms. Duerig provided information regarding management of the Tracy Groundwater Subbasin. In 2015, Zone 7 entered into an MOU with San Luis and Delta Mendota Water Authority (SLDMWA) to clarify management of a small portion of the Tracy Groundwater Subbasin that lies within Zone 7 s jurisdiction. This clarification and definition of roles was necessary to comply with the Sustainable Groundwater Management Act (SGMA). The Tracy Subbasin crosses several county and jurisdictional boundaries and requires substantially more coordination than the Livermore Groundwater Basin. Since the 2015 MOU with SLDMWA, agencies that overlie the Tracy Subbasin have changed the way that they plan to comply with SGMA. At that time, SLDMWA thought that they were going to be the sole Groundwater Sustainable Agency (GSA) for that entire area. Recently, Zone 7 received a letter from SLDMWA terminating the MOU. Byron Bethany Irrigation District (BBID) is now seeking to enter into an MOU with Zone 7. Staff propose to bring an item before the Board to authorize entering into an MOU with BBID to allow them to become the GSA for the portion of the Tracy Subbasin within Zone 7 s jurisdiction. Zone 7 will retain all existing authority for well permitting, monitoring, etc., but delegate SGMA management authority to BBID under similar terms to the MOU previously executed with SLDMWA. Staff noted that BBID must submit its intention to become a GSA to DWR by June 30, Committee members supported the staff recommendation to authorize an MOU with BBID to replace the terminated MOU with SLDMWA. 4. Draft Sustainable Groundwater Management Ordinance David Aladjem discussed a proposed Zone 7 Groundwater Sustainability Ordinance (GSO). He stated that under the District Act and the Sustainable Groundwater Management Act, Zone 7 has both the authority and the responsibility to manage groundwater within its jurisdiction. The

152 ITEM NO.: 16 proposed GSO will be consistent with the Alameda County General Ordinance Code including individual relevant ordinances whereby Zone 7 is already doing well permitting, with primary implementation through the General Manager. The proposed GSO would prohibit unsustainable groundwater use, unreasonable use, and export of groundwater with the goal of promoting water conservation as a way of life. This will also assist Zone 7 in abating any future drought issues and clarify pumping and extraction requirements. Vice President Greci inquired if this would preclude the export of groundwater from the basin for bottled water and Mr. Aladjem indicated that this ordinance would address that situation. Director Palmer asked what kind of feedback we are expecting from groundwater users. Mr. Aladjem stated that those exporting groundwater or using more than the law allows would likely provide the strongest pushback, but that the majority of groundwater users would be protected by giving Zone 7 tools to manage the groundwater basin sustainably on their behalf. He also added that this sustainable management is a mandate from the state under SGMA. Basins that do not manage sustainably will have the State Water Resources Control Board come in and take over the management of their basin. Director Palmer asked if the proposed ordinance would address water waste or impedance of groundwater flow and Ms. Duerig indicated that it would. Vice President Greci asked about how the sustainable pumping level would be determined and Ms. Duerig explained that Zone 7 already had a robust data collection program, but may from time to time need to acquire additional data and the proposed ordinance would help Zone 7 meet SGMA compliance requirements. Vice President Greci also inquired about a recent well application that had been initially rejected. Ms. Duerig explained that the case is still pending but that under the existing well ordinance implementation, staff recommended that CEQA be performed by a third party to determine that there would be no significant impacts to groundwater. Mr. Aladjem reminded the committee that the well ordinance has an existing appeal process. Committee members supported the staff recommendation to bring the draft GSO to the board. 5. Verbal Comments Ms. Duerig and Ms. Mahoney provided a quick update on flood issues and progress along the Arroyo De La Laguna at the emergency repair site. Staff continue to work diligently to find a design that will be accepted by all regulatory agencies so the construction activities can be considered a permanent solution. Vice President Greci complimented staff and stated that it is clear that Zone 7 is doing all that we can. 6. Adjournment Vice President Greci adjourned the meeting at 12:08 p.m. 5

153 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATION CONTACT: Jill Duerig AGENDA DATE: April 19, 2017 ITEM NO. 19a SUBJECT: GENERAL MANAGER S REPORT SUMMARY: The following highlights a few of the key activities which occurred last month. Also attached is a list of the General Manager (GM) contracts executed during March. Environmental and External Affairs: The California Department of Water Resources (DWR) continues to work with the Federal Energy Regulatory Commission (FERC) on the Lake Oroville spillway damage and defining necessary repairs. Regardless of the outcome, this will take time, money and the loss of stored water which will all impact State Water Project operations and costs for many years to come (Zone 7 s share is 2%). Following a three-week hiatus, DWR last week resumed releasing water over the spillway in order to reduce lake levels before the spring snowmelt begins in earnest. To read more about the FERC-DWR exchanges, see the first two bulleted items posted at Staff met with staff from Contra Costa Water District and the other water agency partners for the Los Vaqueros Reservoir Expansion Project to discuss some preliminary modeling. Results suggest that there might be a small amount of new water generated by the project but that it would most likely go to the refuges (ecosystem improvements) and SFPUC/BAWSCA. The modeling work is being done as part of the Supplement to the EIR/EIS to provide a range of impacts; actual operations and allocations will be determined later. In March, the California Water Commission (CWC) began accepting applications for the portion of the 2014 Proposition 1 Water Bond set aside for the Water Storage Investment Program (WSIP). The $7.5 billion water bond included $2.7 billion for public benefits related to new water storage projects. Those public benefits include ecosystem improvements, water quality improvements, flood control, emergency response and recreation. Applications, according to the CWC, will be open until August 1 st. Applications for Sites, Los Vaqueros Expansion and Lake Del Valle Forecast-Informed Reservoir Re-Operations (FIRO) are all planned. Engineering and Flood Control: Staff initiated the process of requesting rehabilitation assistance from the US Army Corps of Engineers (USACE) under PL84-99, the USACE Disaster Operations: Flood Control and Coastal Emergency Act. The initial request covers only damage from the January storms and eight project areas which include 87 individual slides or other facility damage, could take about $7.2 million to repair, based on initial estimates. USACE gave Zone 7 permission to take some interim steps (sand bags and dirt berms to divert

154 flow away from the slopes) while designing the actual emergency repairs for the Local Sponsorship project at 7812 Foothill Road along the Arroyo de la Laguna. That work was done over in late march, which helped during the March storms; survey points showed no additional movement along the slopes since the board meeting. The consultant team is moving forward with a design which is anticipated sometime around mid-april and the USACE Emergency Permit will follow, anticipated by the end of April. Operations and Maintenance: A structural problem was discovered with one of the intake gate valves at Clifton Court Forebay. DWR s Division of Engineering began to repair the damage under an emergency contract that started March 13 th. The estimated duration of the project is days during which time there could be flow interruptions to the South Bay Aqueduct. However, DWR is working with the Bureau of Reclamation to minimize these outages and the Del Valle Plant can receive water from Lake Del Valle. In early March, San Luis Reservoir reached 99% of capacity (2,022,000 acre feet of water is stored at this time). All State Water Project carryover in San Luis that had not been used yet was forfeited as of March 7 th. Administration: With the two-year budget, staff are reviewing section budgets and capital project budgets to see if any mid-cycle adjustments are needed for FY ; any proposed adjustments would be brought to the board for adoption in June. Staff is completing the last step in the application for funding of the ozone project through the Drinking Water State Revolving Fund by submitting the Financial Assistance Application materials for State Water Resources Control Board s consideration. Staff manned a booth at the BayWork Water/Wastewater Industry Career Fair on March 8 th at Laney College. The event was well-attended and included both a high school career fair and a career fair for the general public. This is part of a Bay Area effort to address the Silver Tsunami that is facing water and wastewater agencies. 2

155 Monthly List of GM Contracts March 2017 Contracts: Advanced Hydro Engineering $30, Hydraulic Modeling Support for the Patterson Pass Water Treatment Plant Upgrades & Ozonation Project PMA Consultants, LLC $50, Professional services in support of 2017 Flood Emergency Projects (project management) Flow West, Inc. $50, Professional services in support of 2017 Flood Emergency Projects (design) Alameda County IT Department and Pictometry $ 8, Shared contract with Alameda County for aerial imagery over relevant portion of Alameda County TOTAL March 2017 $138,

156 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATION CONTACT: Jill Duerig AGENDA DATE: April 19, 2017 ITEM NO. 19b SUBJECT: Legislative Update SUMMARY: Zone 7 staff, with the support of Agency consultants, monitors legislation that is being considered in Sacramento, as well as other political activities of interest to the Agency. The Association of California Water Agencies (ACWA) has been lobbying for legislation that clarifies long-term water use efficiency requirements once the emergency conservation regulations are lifted. Assembly Bills 968 and 1654 (both by Rubio) are a result and are generally supported by the water industry as reasonable approaches for implementing longterm reductions in per capita use of water. On the other hand, the Administration has suggested that new requirements should be imposed via a budget trailer bill (Trailer Bill 810); unfortunately, the Trailer Bill circumvents traditional rulemaking processes and includes several components that are concerning including a one-size fits all rather than a local approach with the potential for major compliance costs. The Administration has focused on transportation infrastructure recently with the proposed landmark road repair and transportation investment package to fix roads, freeways and bridges in communities across California and put more dollars toward transit and safety. The bill requires a 2/3rds vote in both the Senate and Assembly. ACWA has also had a small work group collaborating with Senator Hertzberg on the possible introduction of SCA 4 which would put reform of Proposition 218 on the November Ballot; this reform pertains to water fees and charges. The state legislature s Spring Recess is from April 6 th through the 17 th with April 28 th as the last day for policy committees to hear and report to fiscal committees on bills with a fiscal impact (i.e., those that need to be heard by the Appropriations Committee). May 12 th is the last day for policy committees to hear and report to the Floor non-fiscal bills introduced in their respective House. RECOMMENDED ACTION: Information Only

157 ITEM NO.: 19b EXECUTIVE SUMMARY State Legislation Prepared for the Zone 7 Water Agency by The Gualco Group, Inc. Bill Topic Synopsis Staff Recommendation Status of the Bill/Comments as of 04/11/2017 CEQA AB 594 (Irwin) Water supply planning: California Environmental Quality Act: photovoltaic or wind energy generation facility Current law requires a city or county that determines that a project, as defined, is subject to the California Environmental Quality Act to identify any public water system that may supply water for the project and to request those public water systems to prepare a specified water supply assessment. Current law, until January 1, 2018, exempts from the definition of project a proposed photovoltaic or wind energy generation facility that would demand no more than 75 acre-feet of water annually. This bill would indefinitely exempt from the definition of project a proposed photovoltaic or wind energy generation facility that would demand no more than 50 acre-feet of water annually. Watch In Assembly Committee on Water, Parks, and Wildlife AB 1117 (Fong) California Environmental Quality Act This bill would prohibit a lead agency from being required to evaluate the aesthetic effects of a project subject to CEQA and would prohibit aesthetic effects from being considered significant effects on the environment, except in certain circumstances. Watch In Assembly Committee on Natural Resources

158 ITEM NO.: 19b Climate Change SB 584 (de León California Renewables Portfolio Standard Program This bill would state that the goal of the program is to achieve that 50% target by December 31, 2025, and for all electricity sold at retail to be generated by eligible renewable energy resources by December 31, Watch In Senate Committee on Rules Delta AB 732 (Frazier) AB 791 (Frazier) Delta levee maintenance Sacramento-San Joaquin Delta: State Water Project and federal Central Valley Project: new conveyance facility Current law declares legislative intent to reimburse eligible local agencies under this program, until July 1, 2018, in an amount not to exceed 75% of those costs that are incurred in excess of $1,000 per mile of levee. Existing law, until July 1, 2018, authorizes the board to provide funds to an eligible local agency under this program in the form of an advance in an amount that does not exceed 75% of the estimated state share. This bill would extend indefinitely the operation of that declaration of legislative intent and the authorization to advance funds. This bill would require, before a water contractor enters into a contract to pay for certain costs, that the lead agency provide the breakdown of costs for each water contractor entering into a contract and what benefits each contractor will receive based on the proportion it has financed of the proposed conveyance project. Watch Oppose In Assembly Committee on Water, Parks and Wildlife In Assembly Committee on Water, Parks and Wildlife AB 792 (Frazier) Sacramento-San Joaquin Delta: Delta Plan: certification of consistency The Sacramento-San Joaquin Delta Reform Act of 2009 requires a state or local public agency that proposes to undertake a covered action to prepare and submit to the council a written certification of consistency with the Delta Plan before undertaking that action. This bill would prohibit the Delta Stewardship Council from granting a certification of consistency with the Delta Plan until the board has completed its update of a specified water quality control plan. Oppose In Assembly Committee on Water, Parks and Wildlife

159 AB 793 (Frazier) Sacramento-San Joaquin Delta: financing The bill would state that the maintenance and repair of the Delta are eligible for the same forms of financing as other water collection and treatment infrastructure and would specify the maintenance and repair activities that are eligible are limited to certain cleanup and abatement-related restoration and conservation activities. Oppose ITEM NO.: 19b In Assembly Committee on Water, Parks and Wildlife Drinking Water AB 166 (Salas) Safe drinking water: household filtration systems: rebate program This bill would require the State Water Resources Control Board, in collaboration with specified entities, to conduct a study on the feasibility and financial stability of a rebate program that would provide a household that is served by a water system that does not meet primary drinking water standards with a rebate for the purchase of a household water filtration system. Watch In Assembly Committee on Environmental Safety and Toxic Materials AB 554 (Cunningham) Desalination: statewide goal This bill would establish a goal to desalinate 300,000 acre-feet of drinking water per year by the year 2025 and 500,000 acrefeet of drinking water per year by the year Watch In Assembly Committee on Appropriations AB 1490 (Gray) State Water Resources Control Board: school drinking water This bill would require the State Water Resources Control Board, before adopting or approving a water quality control plan, water quality objectives, or a program of implementation, to evaluate impacts on primary drinking water standards and secondary drinking water standards for, and impacts on groundwater basins that provide drinking water to, impacted local education agencies located in whole or in part in a disadvantaged community. Watch In Assembly Committee on Environmental Safety and Toxic Materials AB 1671 (Caballero) Backflow prevention assemblies This bill, on or before January 1, 2020, would require the State Air Resources Control to update its backflow protection regulations and to adopt regulations establishing the minimum standards for a backflow prevention assembly tester for purposes of a California-specific certification by a local health official. Watch In Assembly Committee on Environmental Safety and Toxic Materials

160 SB 623 (Monning) Safe and Affordable Drinking Water This bill would establish the Safe and Affordable Drinking Water Fund in the State Treasury and would provide that moneys in the fund are continuously appropriated to the Office of Sustainable Water Solutions. Watch ITEM NO.: 19b In Senate Committee on Environmental Quality Employment AB 5 (Gonzalez Fletcher) Employers: Opportunity to Work Act This bill would create the Opportunity to Work Act. The bill would require an employer with 10 or more employees to offer additional hours of work to an existing nonexempt employee before hiring an additional employee or subcontractor, except as specified, would require an employer to post a notice of employee rights, as specified, and would require the employer to maintain certain documentation. The bill would authorize an employee to file a complaint for violation of these provisions with the division and to, in the alternative, bring a civil action for remedies under the act. Watch In Assembly Committee on Labor and Employment AB 20 (Kalra) Public employee retirement systems: divestment: Dakota Access Pipeline This bill would prohibit the boards of administration of the Public Employees Retirement System and the State Teachers Retirement System, on and after January 1, 2018, from making additional investments or renewing investments in a company constructing, or funding the construction of, the Dakota Access Pipeline, as defined. This bill would require the boards, on or before July 1, 2018, to liquidate their investments in a company constructing, or funding the construction of, the Dakota Access Pipeline. Watch In Assembly Committee on Public Employees, Retirement, and Social Security AB 46 (Cooper) Employers: wage discrimination Under current law, an employer or other person who violates or causes a violation of that prohibition, or who reduces the wages of any employee in order to comply with that prohibition, is guilty of a misdemeanor. This bill would define employer for those purposes to include public and private employers. The bill would specify that a public employer is not subject to the misdemeanor provision. Watch In Assembly Committee on Labor and Employment

161 AB 52 (Cooper) Public employees: orientation and informational programs: exclusive representatives Current law, including the Meyers-Milias-Brown Act, the Ralph C. Dills Act, the Trial Court Employment Protection and Governance Act, the Trial Court Interpreter Employment and Labor Relations Act, and the Los Angeles County Metropolitan Transportation Authority Transit Employer-Employee Relations Act, as well as provisions commonly referred to as the Educational Employment Relations Act and the Higher Education Employer-Employee Relations Act, regulates the labor relations of the state, the courts, and specified local public agencies and their employees. This bill would require the public employers regulated by the acts described above to provide all employees an orientation. The bill would also require these public employers to permit the exclusive representative, if applicable, to participate. Watch ITEM NO.: 19b In Assembly Committee on Public Employees, Retirement, and Social Security AB 92 (Bonta) Public contracts: payment Current law until January 1, 2018, authorizes the retention proceeds withheld from any payment by an awarding entity, as described, from the original contractor, by the original contractor from any subcontractor, and by a subcontractor from any subcontractor to exceed 5% on specific projects where the director of the applicable department, as specified, has made, or the governing body of the public entity or designated official of the public entity has approved, a finding prior to the bid that the project is substantially complex and requires a higher retention and the department or public entity includes both this finding and the actual retention amount in the bid documents. This bill would extend the operation of these provisions to January 1, Watch In Assembly Committee on Appropriations AB 241 (Dababneh) Personal information: privacy: state and local agency breach This bill would require a state or local agency, if it was the source of the data breach, to offer to provide appropriate identity theft prevention and mitigation services at no cost to a person whose information was or may have been breached if the breach exposed or may have exposed the person s social security number, driver s license number, or California identification card number. Watch In Assembly Committee on Appropriations

162 ITEM NO.: 19b Fish and Wildlife AB 947 (Gallagher) Department of Fish and Wildlife: lake or streambed alteration agreements: definitions Current law prohibits an entity from substantially diverting or obstructing the natural flow of, or substantially changing or using any material from the bed, channel, or bank of, any river, stream, or lake, or from depositing certain material where it may pass into any river, stream, or lake, without first notifying the Department of Fish and Wildlife of that activity, and entering into a lake or streambed alteration agreement if required by the department to protect fish and wildlife resources. This bill would define bank, bed, channel, and river and stream for purposes of these provisions. Watch In Assembly Committee on Appropriations AB 975 (Friedman) Natural resources: wild and scenic rivers Current law establishes that it is the policy of the state that certain rivers that possess extraordinary scenic, recreational, fishery, or wildlife values shall be preserved in their freeflowing state, together with their immediate environments, for the benefit and enjoyment of the people of the state. his bill would revise that policy to specify that certain rivers that possess scenic, recreational, fishery, wildlife, historical, cultural, geological, ecological, hydrological, botanical, or other similar values shall be preserved in their free-flowing state, together with their immediate environments, for the benefit and enjoyment of the people of the state, and would revise the definition of immediate environments, and define the term extraordinary value for purposes of that policy. Watch On Assembly Floor AB 1133 (Dahle) California Endangered Species Act: experimental populations This bill would provide that a person who obtains a federal enhancement of survival permit that authorizes the take of endangered or threatened species that is also listed as endangered, threatened, or candidate under CESA, in order to establish or maintain an experimental population of the species pursuant to FESA, requires no further authorization or approval under CESA for that person to take that species as identified in, and in accordance with, the enhancement of survival permit, if specified requirements are met. Watch In Assembly Committee on Water, Parks and Wildlife

163 SB 144 (McGuire) Fish and Wildlife: steelhead trout: fishing reportrestoration card Current law requires revenues from steelhead trout fishing license fees to be deposited in the Fish and Game Preservation Fund and to be available for expenditure, upon appropriation by the Legislature, to monitor, restore, or enhance steelhead trout resources consistent with specified law, and to administer the fishing report-restoration card program. These provisions become inoperative as of July 1, 2017, and are repealed as of January 1, This bill would extend the operation of those provisions to July 1, 2022, to be repealed as of January 1, Watch ITEM NO.: 19b In Senate Committee on Appropriations SB 473 (Hertzberg) California Endangered Species Act. Under the California Endangered Species Act, the Department of Fish and Wildlife may authorize the take of listed species pursuant to an incidental take permit if the take is incidental to an otherwise lawful activity, the impacts are minimized and fully mitigated, and the issuance of the permit would not jeopardize the continued existence of the species. This bill would also apply the take prohibition to public agencies. Watch In Senate Committee on Appropriations SB 506 (Nielsen) Department of Fish and Wildlife: lake or streambed alteration agreements: Internet Web site This bill would require the Department of Fish and Wildlife, on or before December 31, 2018, and periodically thereafter, to upgrade the information on its Internet Web site regarding lake or streambed alteration agreements to facilitate members of the public in obtaining individualized guidance regarding the lake and streambed alteration program, as specified. Watch In Senate Committee on Appropriations SB 532 (Dodd) California State Safe Harbor Agreement Program Act: tricolored blackbird The bill would extend the California State Safe Harbor Agreement Program Act indefinitely and would exempt the approval of a safe harbor agreement covering only tricolored blackbird from CEQA. Watch In Senate Committee on Natural Resources and Water SB 667 (Atkins) Department of Water Resources: riverine and riparian stewardship improvements This bill, upon an appropriation of funds from the Legislature, would require the Department of Water Resources to establish a program to implement watershed-based riverine and riparian stewardship improvements by providing technical and financial assistance in support of projects with certain benefits. Watch In Senate Committee on Natural Resources and Water

164 ITEM NO.: 19b General AB 161 (Levine) Department of Finance: infrastructure investment This bill would authorize the Department of Finance to identify infrastructure projects in the state for which the department will guarantee a rate of return on investment for an investment made in that infrastructure project by the Public Employees Retirement System. The bill would create the Reinvesting in California Special Fund as a continuously appropriated fund and would require the moneys in the fund to be used to pay the rate of return on investment. The bill would require the rate of return on investment to be subject to the availability of moneys in the fund. Watch In Assembly Committee on Appropriations AB 1673 (Aguiar-Curry) The California Water Plan Current law requires the Department of Water Resources to update every 5 years the plan for the orderly and coordinated control, protection, conservation, development, and use of the water resources of the state, which is known as The California Water Plan. This bill would make technical, nonsubstantive changes to that requirement. Watch In Print SB 244 (Lara) Privacy: agencies: personal information This bill would require that personal information, as defined, and records containing personal information that are collected or obtained by the state, any state agency, or any subdivision of the state, including agents of the California State University and the California Community Colleges, as well as any private persons contracted to administer public services or programs or maintain data for state or local agencies, from an applicant for public services or programs be collected, recorded, or used only for the purpose of assessing eligibility for and providing those public services and programs for which the application has been submitted. Watch In Senate Committee on Judiciary

165 SB 657 (Bates) California Public Records Act: reverse public records actions The bill would require a court in a reverse public records action to apply the provisions of the California Public Records Act as if the action had been initiated by a person requesting disclosure of a public record. This bill would require the requestor, as defined, to be named as a real party of interest in a reverse public records action, and would require a court to allow the requestor, at his or her request, to be heard on the merits of the reverse public records action. Watch ITEM NO.: 19b In Senate Committee on Judiciary SB 701 (Hueso) State Resources Obligations Act of 2018 The bill would enact the State Resources Obligations Act of 2018, which, if approved by the voters, would authorize the issuance of bonds in an unspecified amount pursuant to the State General Obligation Bond Law to finance a program to comply with specified state obligations relating to natural resources. This bill would provide for the submission of these provisions to the voters at the November 6, 2018, statewide general election. Watch In Senate Committee on Governance and Finance Governance AB 187 (Gloria) Political Reform Act of 1974: local ballot measures contribution and expenditure reporting This bill would require a committee to file a report each time it makes independent expenditures aggregating $5,000 or more to support or oppose the qualification of a single local initiative or referendum ballot measure. Watch On Assembly Floor AB 1089 (Mullin) Local elective offices: contribution limitations This bill would, commencing January 1, 2019, prohibit a person from making to a candidate for local elective office, and would prohibit a candidate for local elective office from accepting from a person, a contribution totaling more than the amount set forth in the act for limitations on contributions to a candidate for elective state office. Watch In Assembly Committee on Appropriations

166 AB 1323 (Weber) Sustainable water use and demand reduction: stakeholder workgroup This bill would require the Department of Water Resources to convene a stakeholder workgroup with prescribed representatives invited to participate, including, among others, representatives of the department and the State Water Resources Control Board, no later than February 1, The bill would require the stakeholder workgroup to develop, evaluate, and recommend proposals for establishing new water use targets for urban water suppliers and to examine and report to the Governor and the Legislature by December 31, 2018, as specified. Watch ITEM NO.: 19b In Assembly Committee on Water, Parks and Wildlife AB 1603 (Ridley- Thomas) Meyers-Milias-Brown Act: local public agencies The MMBA rules and regulations may include exclusive recognition of employee organizations formally recognized pursuant to a vote of the employees of the agency or an appropriate unit thereof, subject to the right of an employee to represent himself or herself. This bill instead would specify that those rules and regulations may provide for exclusive recognition of employee organizations formally recognized pursuant to a vote of the employees of the agency or an appropriate unit thereof, subject to the employee s right to represent himself or herself, and provided that an otherwise appropriate unit of a public agency and one or more joint employers do not require the agency or joint employer s consent. Watch In Assembly Committee on Public Employees, Retirement and Social Security SB 371 (Moorlach) Local public employee organizations This bill would prohibit an individual who will be covered by a memorandum of understanding between a local public agency and a recognized public employee organization from representing the public agency in negotiations with the recognized employee organization. Watch In Senate Committee on Public Employees and Retirement SB 519 (Beall) Santa Clara Valley Water District This bill would specify that the Santa Clara Valley Water District has the authority to engage in acts the board of the district deems appropriate and beneficial to reduce impacts on the waters from activity in and around waterways in the district, as specified. Watch In Senate Committee on Environmental Quality

167 SB 634 (Wilk) Santa Clarita Valley Water District Current law, the Castaic Lake Water Agency Law, created the Castaic Lake Water Agency and authorizes the agency to acquire water and water rights, including water from the State Water Project, and to provide, sell, and deliver water at wholesale for municipal, industrial, domestic, and other purposes. This bill would repeal the Castaic Lake Water Agency Law. Watch ITEM NO.: 19b In Senate Committee on Governance and Finance SB 691 (Lara) Local agency elections: party preference Existing law requires a candidate for an elective office in a local agency to include an affidavit with his or her nomination papers, indicating the candidate s name, designation, and residence address, as specified. This bill would additionally require that the candidate disclose his or her party preference, or indicate that he or she declines to disclose a party preference, on the affidavit of the nominee. Watch In Senate Committee on Elections and Constitutional Amendments Groundwater AB 313 (Gray) Water Current law establishes the State Water Resources Control Board in the California Environmental Protection Agency consisting of 5 members appointed by the Governor, including one member required to be an attorney admitted to practice law in this state who is qualified in the fields of water supply and water rights and one registered civil engineer under the laws of this state qualified in the fields of water supply and water rights. This bill, supported by BBID, would revise the qualifications for the membership to the board by eliminating those requirements for qualification in the field of water rights. Watch In Assembly Committee on Water, Parks, and Wildlife AB 321 (Mathis) Groundwater sustainability plans This bill would require the groundwater sustainability agency to solicit the participation of farmers, ranchers, and other qualified professionals within the groundwater basin prior to and during the development and implementation of the plan. Watch In Assembly Committee on Water, Parks, and Wildlife AB 487 (Mathis) Sustainable Groundwater Management Act This bill would state the intent of the Legislature to enact statutory changes relating to the Sustainable Groundwater Management Act. Watch In Print

168 AB 851 (Caballero) Local agency design-build projects Current law requires specified information submitted by a design-build entity, as defined, in the design-build procurement process to be certified under penalty of perjury. This bill would modify the definition of local agency for those purposes to include special districts that provide or operate specified types of services or facilities. This bill would expand the list of public works projects for which a local agency may utilize the design-build procurement process. Watch ITEM NO.: 19b In Assembly Committee on Local Government SB 252 (Dodd) Water wells Current law establishes various state water policies, including the policy that the use of water for domestic purposes is the highest use of water. This bill would require, in an action alleging liability for interference with a well used primarily for domestic use, reasonableness of each party s beneficial use of water to be determined through consideration of specified factors. Watch In Senate Committee on Governance and Finance SB 372 (Cannella) San Joaquin River Exchange Contractors Groundwater Sustainability Agency This bill would create the San Joaquin River Exchange Contractors Groundwater Sustainability Agency as the exclusive groundwater sustainability agency and successor in interest to the agency that submitted a notice of intent to become a groundwater sustainability agency to the department on December 22, The bill would establish the initial boundaries of the agency, would authorize the agency s boundaries to be changed upon a petition to and approval of the board of supervisors of the county in which the change is proposed after a noticed public hearing, and would require the Counties of Fresno, Madera, Merced, and Stanislaus to maintain a map depicting the boundaries of the agency. Watch In Senate Committee on Appropriations Invasive Species AB 1587 (Levine) Invasive species: dreissenid mussels This bill would require, rather than authorize, the Director of Fish and Wildlife to order the closure of waters or facilities to conveyances for a period of no less than seven working days if dreissenid (zebra/quagga) mussels are detected or may be present. Upon lifting a closure on a reservoir, the bill would require implementation of a dreissenid mussel control program Support In Assembly Committee on Appropriations

169 to prevent the spread of dreissenid mussels within the state and would authorize the Division of Boating and Waterways to award grants from funds generated from the quagga and zebra mussel prevention infestation fee to those entities required by the director to implement a dreissenid mussel control program for the reasonable regulatory costs to implement the program. ITEM NO.: 19b SB 704 (Galgiani) Division of Boating and Waterways: water hyacinth control programs This bill would require that Division of Boating and Waterways to collaborate with the California Conservation Corps and use members of the corps in implementing its water hyacinth control programs, as provided. Watch In Senate Committee on Natural Resources and Water Taxation AB 219 (McCarty) Property taxes: revenue allocations Current property tax law requires the county auditor to allocate and pay certain property tax revenues to designated local jurisdictions within the county in accordance with specified formulas, including allocating and paying additional revenues generated by a rate levied in excess of the 1% limitation prescribed by the California Constitution on ad valorem taxes on real property, as specified. This bill would instead require those allocations and payments to be made on a timely basis no later than 31 calendar days after the close of the preceding monthly or 4-weekly accounting period. Watch In Senate Committee on Revenue and Taxation SCA 9 (Glazer) Property tax: new construction exclusion: rain water capture system This bill would authorize the Legislature to exclude from classification as newly constructed the construction or addition, completed on or after January 1, 2018, of a rain water capture system. Watch In Senate Committee on Governance and Finance Water Bond AB 18 (Garcia, E.) California Clean Water, Climate, and Costal Protection and Outdoor Access For All Act of 2018 This bill would enact the California Clean Water, Climate, Coastal Protection, and Outdoor Access For All Act of 2018, which, if approved by the voters, would authorize the issuance of bonds in an amount of $3,105,000,000 pursuant to the State General Obligation Bond Law to finance a clean water, climate, coastal protection, and outdoor access for all program Watch At Senate Desk

170 SB 5 (de Léon) California Drought, Water, Climate, Coastal Protection, and Outdoor Access For All Act of 2018 This bill would enact the California Drought, Water, Parks, Climate, Coastal Protection, and Outdoor Access For All Act of 2018, which, if approved by the voters, would authorize the issuance of bonds in an amount of $3,000,000,000 pursuant to the State General Obligation Bond Law to finance a drought, water, parks, climate, coastal protection, and outdoor access for all program. Watch ITEM NO.: 19b In Senate Committee on Appropriations Water Conservation AB 1000 (Friedman) Water conservation: certification Current law requires the State Energy Resources Conservation and Development Commission to establish minimum levels of operating efficiency to promote the use of energy and water efficient appliances. This bill would require the commission to certify innovative water conservation and water loss detection and control technologies that meet certain criteria. Watch In Assembly Committee on Water, Parks and Wildlife AB 1668 (Friedman) Water conservation: guidelines This bill would require the State Water Resources Control Board, on or before July 1, 2018, in consultation with the department and other appropriate state agencies, to adopt water conservation guidelines that are consistent with a specified report issued in response to Executive Order B Watch In Assembly Committee on Water, Parks and Wildlife Water Efficiency AB 968 (Rubio) Urban retail water use: water efficiency targets This bill, supported by ACWA, would require DWR to submit to the Legislature by December 31, 2018, a report that states preliminary water efficiency targets for 2025 for each of the state s hydrologic regions with per capita daily water use targets based on and considering specified factors. Support In Assembly Committee on Water, Parks and Wildlife Water Management AB 176 (Salas) Water project: Friant-Kern Canal Current law requires DWR, upon appropriation by the Legislature, to provide funding for a project that substantially conforms to the project description for the Reverse Flow Pump-back Facilities on the Friant-Kern Canal Restoration Project, as specified, provided that certain conditions are met. Current law requires that the appropriation be no more than $7,000,000. This bill would appropriate $7,000,000 from the Watch In Assembly Committee on Appropriations

171 General Fund to the department for this project. ITEM NO.: 19b AB 200 (Eggman) Reclamation District No. 1614: Pump No. 7 This bill would appropriate $1,175,000 from the General Fund to DWR for the purpose of constructing a new facility to replace Pump Station No. 7 of Reclamation District No Smith Tract. The bill would require DWR to grant the $1,175,000 appropriated for this purpose to Reclamation District No Smith Tract to construct a new pump station to replace Pump Station No. 7. Watch In Assembly Committee on Appropriations AB 1654 (Rubio) Water shortage: urban water management planning This bill, supported by ACWA, would require each urban retail water supplier to report annually by June 15 to the Department of Water Resources the status of its water supplies for that year and whether the supplies will be adequate to meet projected customer demand, as prescribed. The bill would require the urban retail water supplier to implement the appropriate responses as described in its water shortage contingency analysis if the urban retail water supplier reports that all available water supplies for the applicable water year will not be adequate to meet projected customer demand. Support In Assembly Committee on Water, Parks and Wildlife Water Quality AB 1369 (Gray) Water quality and storage Current law requires all moneys, except for fines and penalties, collected by the State Air Resources Board from the auction or sale of allowances as part of a market-based compliance mechanism relative to reduction of greenhouse gas emissions to be deposited in the Greenhouse Gas Reduction Fund. This bill would require the Department of Water Resources to increase statewide water storage capacity by 25% by January 1, 2025, and 50% by January 1, 2050, as specified. Watch In Assembly Committee on Water, Parks and Wildlife AB 1605 (Caballero) Maximum contaminant levels: nitrate: replacement water This bill would prohibit a person or entity providing replacement water, as defined, to address drinking water that exceeds the maximum contaminant level for nitrate in Watch In Assembly Committee on Environmental

172 groundwater from being deemed to have caused pollution or a nuisance, or from being liable for negligence or trespass, if certain conditions are applicable. ITEM NO.: 19b Safety and Toxic Materials Water Recycling AB 574 (Quirk) Potable reuse This bill would remove certain references to direct potable reuse, indirect potable reuse for groundwater recharge, and surface water augmentation, and would instead specify the four different types of potable reuse projects as groundwater augmentation, reservoir augmentation, raw water augmentation, and treated water augmentation. SB 740 (Wiener) Water Rights Onsite treated water This bill would, on or before December 1, 2018, require the State Water Resources Control Board, in consultation with other state agencies, to adopt regulations, as specified, for a comprehensive risk-based framework to assist local jurisdictions in developing oversight and management programs for onsite treatment of water for nonpotable use. Watch Watch In Assembly Committee on Water, Parks and Wildlife In Senate Committee on Environmental Quality AB 1420 (Aguiar-Curry) Water rights: small irrigation use: lake or streambed alteration agreements This bill would require the State Water Resources Control Board to give priority to adopting, on or before June 30, 2021, except as provided, general conditions that permit a registrant to store water for small irrigation use during times of high streamflow in exchange for the registrant reducing diversions during periods of low streamflow, as specified. The bill would require that the actions of the board under these provisions be deemed an action taken for the protection of the environment for purposes of specified California Environmental Quality Act guidelines, if those actions do not result in the relaxation of streamflow standards. Watch In Assembly Committee on Water, Parks and Wildlife

173 ITEM NO.: 19b Water Supply AB 355 (Chu) Water pollution: enforcement Current law permits the State Water Resources Control Board or regional board, in lieu of assessing all or a portion of the mandatory minimum penalties against a publicly owned treatment works serving a small community, as defined, to elect to require the publicly owned treatment works to spend an equivalent amount towards completion of a compliance project proposed by the publicly owned treatment works if the state board or regional board makes certain findings. Current law, for these purposes, defines "a publicly owned treatment works serving a small community." This bill, for purposes of the exception, would instead define publicly owned treatment works serving a small community as a publicly owned treatment works serving a population of 20,000 persons or fewer or a rural county, with a financial hardship. Watch In Assembly Committee on Appropriations

174 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: ADMINISTRATION CONTACT: Jill Duerig AGENDA DATE: April 19, 2017 ITEM NO. 19c SUBJECT: March Outreach Activities E-newsletter, March 17, 2017 The March 17, 2017 enewsletter included articles: 1) Local flood emergency declaration and funding Zone 7 would be pursuing; 2) Zone 7 s sponsorship of emergency watershed work to address bank damage at a Foothill Road property; and 3) Information regarding Fix-a-Leak Week, March 20-26, and May as Water Awareness Month coming. The enewsletter was opened by 257 of the 633 recipients. This is an open rate of 40.6% (22.5% is the industry average) and local papers picked up the articles on the declaration of local flood emergency and Zone 7 s role in assisting the Foothill Road property. Amador High School s Health Quest Zone 7 had a booth at the Amador High School Health Quest, designed to help Amador High students learn about and make connections with community organizations that support healthy living. At the booth, students played an interactive game that helped them understand how water is a part of everything they eat and contact. Many students were fascinated by the Hidden Uses of Water in the Water Footprint activity. All were eager to take a shower timer and shower stickers. Personal interactions were made with over 350 students. Fix-a-Leak Week Outreach 1,000 Fix-a-Leak Week worksheets were distributed to second, third and fourth graders throughout the service area. At the time of distribution students were encouraged to share the activity with their parents and go on a leak hunt in their home. Website & E-news Subscription Activity 4,000 3,500 3,000 2,500 2,000 1,500 1, Total Website Visits 2,959 2, ,120 1, Unique Web Visitors October November December January February March

175 ALAMEDA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, ZONE NORTH CANYONS PARKWAY, LIVERMORE, CA PHONE (925) FAX (925) ORIGINATING SECTION: INTEGRATED PLANNING CONTACT: Sal Segura/Amparo Flores AGENDA DATE: April 19, 2017 ITEM NO. 19d SUBJECT: Water Inventory and Demand Update (March 2017) SUMMARY: This staff report summarizes Zone 7 s water supply, usage and storage conditions as of the end of March The report takes into account the various sources of supply and storage available to Zone 7 locally and in State Water Project facilities, as well as in remote groundwater storage banks. Water supplies are used to meet treated water demands from municipal and industrial customers (retailers and direct retail) and untreated water from agricultural customers. The report also includes calculated watershed outflow as an indication of local hydrologic conditions. A monthly summary of treated water demands is included, with comparisons to previous years conditions. Finally, to provide a state-level perspective on water supply conditions, this report also presents the precipitation conditions in the Northern Sierras, as well as the storage levels in key State Water Project (SWP) reservoirs. Each year, Zone 7 s incoming water supplies are primarily comprised of State Water Project (SWP) water (Table A, Article 21, and Turnback/Multi-Year Pools), a transfer agreement with Byron Bethany Irrigation District (BBID), and local water from Arroyo Valle captured in Lake Del Valle. Other supplies include the Yuba Accord and the Dry Year Transfer Program. In years of abundant supply, Zone 7 strives to maximize storage both locally and outside its service area. Excess supplies are stored in the Livermore-Amador Valley Groundwater Basin (using artificial recharge), Lake Del Valle, San Luis Reservoir (SWP carryover), and in groundwater banks in Kern County. When needed, water from storage a combination of surface water and groundwater is used to meet demands. In the first quarter of 2017 (January through March 2017), Zone 7 supplied a total of 4,500 AF and placed into storage 1,000 AF. In March, Zone 7 s storage increased to 82,900 AF in offsite groundwater banks, 116,000 AF in the local basin (operational storage above historical low), and 13,200 AF in Lake Del Valle. There is 48,400 AF of Table A remaining and 1,200 AF is available as Yuba/Turnback Pool. Overall supplies at the end of March 2017 are estimated at 261,700 AF (Incoming Supplies + Total Storage from Table 2), compared to a projected demand of 35,000 AF for treated and untreated water for the remainder of the year. Conservation in March 2017 was about 40% relative to March 2013 demands. BACKGROUND: Each year, Zone 7 s incoming water supplies are primarily comprised of State Water Project (SWP) water (Table A, Article 21, and Turnback/Multi-Year Pools), a transfer agreement with Byron Bethany Irrigation District (BBID), and local water from Arroyo Valle captured in Lake Del Valle. Other supplies include the Yuba Accord and the Dry Year Transfer Program. These are all surface water supplies, delivered to the Tri-Valley via the South Bay Aqueduct (SBA),

176 which is a SWP facility. In years of abundant supply, Zone 7 strives to maximize storage both locally and outside its service area to prepare for dry years. Arroyo Valle runoff is captured and stored in Lake Del Valle and usually saved for the following year. Zone 7 stores excess SWP water in San Luis Reservoir as carryover. Water is also stored in the Livermore-Amador Valley Groundwater Basin (main groundwater basin) through artificial recharge when surface water is available from either the SWP or from Arroyo Valle runoff stored in Lake Del Valle. Once local recharge capacity has been exhausted, SWP water is transferred to offsite storage in Kern County groundwater banks, namely, Semitropic Water Storage District and Cawelo Water District. When needed, water from storage a combination of surface water and groundwater is used to meet demands. On average, surface water makes up 80% of the water that Zone 7 supplies and local groundwater makes up the rest. Although groundwater makes up about 20% of Zone 7 s municipal demands, it is not considered a separate source of water supply because Zone 7 only extracts groundwater previously imported and stored underground via artificial recharge. Using the groundwater basin as a storage reservoir is critical for long-term reliability in the Tri-Valley. Through this conjunctive use, excess water imported in wet years is banked in the groundwater basin via artificial recharge and subsequently recovered in dry years to augment low SWP allocations, as well as during emergencies and facility shutdowns for maintenance. The following table describes these water sources in more detail. Table 1. Zone 7 s Water Sources WATER SUPPLY Table A Article 21 Turnback and Multi-Year Pools (MYP) BBID Lake Del Valle (Local Water): Yuba Accord Dry Year Transfer Program DESCRIPTION This source is Zone 7 s portion of the SWP annual allocation and represents the largest portion of Zone 7 s new water each year. Zone 7 s maximum allocation is 80,619 acre-feet (AF) annually. The average allocation is 62% or about 50,000 AF. This is SWP surplus water that is made available, in addition to Table A water, when there is SWP water available that cannot be stored in San Luis Reservoir because it is full. This is water made available by other SWP contractors who wish to sell excess supply. The Multi-Year Pool was a two-year pilot program that ended in 2016, but may be reconsidered in the future as a permanent replacement for the Turnback Pool. Whenever BBID has surplus supply, water can be made available through a transfer agreement with BBID, a non-swp contractor, subject to approvals by the Department of Water Resources (DWR) and the Bureau of Reclamation. The amount varies up to 5,000 AF annually. For planning purposes, BBID water is presumed unavailable this year as the agreement is being re-evaluated. Zone 7 has a water right for Arroyo Valle water captured in Lake del Valle, which becomes available for use once it has been stored for 30 days. The annual average yield of this source is 7,300 AF. Water captured in Lake Del Valle during the current year needs to be used within the following year. This water is available mostly in dry years through agreement with DWR and Yuba County Water Agency. Zone 7 gets about 1% of available water. During dry years, the State Water Contractors negotiates water purchases with farmers north of the Delta and makes that water available to interested SWP contractors. 2

177 WATER SUPPLY Local Groundwater Article 56 (Carryover) Offsite Groundwater Banks DESCRIPTION Zone 7 recharges the Livermore Valley groundwater basin with surface water and uses groundwater for peaking, dry years, and emergencies. Zone 7 s long-term average groundwater pumping is 8,000 AF per year; Zone 7 s maximum pumping capacity is 34,000 AF in one year. The basin has 126,000 AF of operational storage capacity, which is storage above historical lows. This is unused annual allocation of Table A water, which rolls over as carryover for use in future years by individual SWP contractors. In most years this water remains in San Luis Reservoir, but in wet years such as 2017, as the reservoir fills due to available Delta pumping and DWR needs more storage capacity, this water is gradually converted to SWP water and is lost to Zone 7. When this happens, Article 21 water (see above) is offered to the SWP contractors as surplus water. Each year, Zone 7 typically reserves 10,000-15,000 AF as carryover to provide a buffer against varying Table A allocation. Zone 7 has agreements with Semitropic Water Storage District and Cawelo Water District in Kern County for 78,000 AF and 120,000 AF of storage capacity, respectively. Zone 7 recovers water from these banks when needed during dry years (e.g., 2014 and 2015). Via exchange, recovered water is delivered via the SBA as surface water from the Delta. The sources described above are used to meet treated water demands from municipal and industrial customers (retailers and direct retail) and untreated water from agricultural customers. Excess surface water supplies are placed into storage either locally or remotely for future use as needed. DISCUSSION: On May 18, 2016, the State Water Resources Control Board directed water providers to determine the level of local conservation necessary to sustain another three years of drought following As reported to the State Board, given Zone 7 s 2016 supply and storage conditions, there was no need for mandatory conservation within the service area for the foreseeable future. On June 15, 2016, the Zone 7 Board lifted the local drought emergency, set a voluntary 10% conservation target to support ongoing statewide water conservation efforts, and directed staff to continue working with the water retailers to promote wise use of water. On February 8, 2017, the State Board adopted an emergency water conservation regulation to amend and extend the May 18, 2016 regulation; the amended regulation allowed certain suppliers the opportunity to submit or resubmit their water supply reliability assessments by March 15, 2017 and it did not require mandatory conservation unless water suppliers determined that they have a shortfall. Since Zone 7 continues to have sufficient water supplies to meet demands without the need for mandatory conservation, Zone 7 did not resubmit the water supply reliability assessment. Prohibitions against water waste remain and the extension maintains urban water supplier monthly reporting and basic water conservation measures. For planning purposes, Zone 7 is assuming 20% conservation based on 2013 demands or 39,400 vs 49,300 acre-feet. The following sections describe Zone 7 s current water inventory, treated water demands with comparisons to previous years conditions, precipitation conditions in the Northern Sierras, as well as the storage levels in key SWP reservoirs. 3

178 A. Water Inventory The following is a summary of Zone 7 s current supplies, use, and storage. Unless otherwise noted, year refers to calendar year Table 2 shows the amount of water supplied to Zone 7 and delivered to its customers, running balances of storage, as well as watershed outflow. In the first quarter of 2017 (January through March 2017), Zone 7 supplied a total of 4,500 AF and placed into storage 1,000 AF. In March, Zone 7 s storage increased to 82,900 AF in offsite groundwater banks, 116,000 AF in the local basin (operational storage above historical low), and 13,200 AF in Lake Del Valle. There is 48,400 AF of Table A remaining and 1,200 AF is available as Yuba/Turnback Pool. Overall supplies at the end of March 2017 are estimated at 261,700 AF (Incoming Supplies + Total Storage from Table 2), compared to a projected remaining demand of 35,000 AF for treated and untreated water for the remainder of the year. The current SWP allocation is 60%, which is equivalent to 48,400 AF of new supply for By the end of March, none had been used, leaving 48,400 AF available. Water from the Multi- Year Pool is not available in Water from the Turnback Pools has been made available in 2017 in the amount of 700 AF for Zone 7. In 2017, one contractor has offered to sell 9,000 AF via Turnback Pool A. Zone 7 requested 1,000 AF and was awarded 500 AF. Turnback Pool B will also be potentially available of which 200 AF are expected. Although 2017 has been classified as wet, 60,000 AF of Component 1 Yuba water will be made available. This amount is estimated at 500 AF for Zone 7. In 2016, significant runoff into Lake Del Valle resulted in 8,900 AF of surface water available to Zone 7 for use in As the rains continued into the winter months of 2017, additional water has been captured (4,300 AF) but it maxed out when the lake reached the Top of Conservation Pool (39,000 AF). Most of the water that came into the lake above that point was released for flood management. Natural runoff caused the water level to encroach into Flood Zone I (704 ), which is equivalent to 41,000 AF, prompting DWR to make flood releases to lower the lake level below (39,000 AF). An estimated 6,000 AF came into the lake in March with 5,800 AF released for flood control management. However, Zone 7 was able to use a portion of the flood water release (2,150 AF) at the Del Valle Water Treatment Plant. This flood water released to the SBA is taken free of charge under Zone 7 s water rights permit, and is in addition to any water stored in Lake Del Valle. The level at the end of March is approximately 702, which is just over Top of Conservation Pool. Groundwater storage balance is estimated based on monthly groundwater level measurements. An empirical rating curve has been developed for each sub-basin as a quantitative estimation of volume based on average groundwater levels. Zone 7 plans to maximize recharge in Zone 7 s groundwater pumping made up 930 AF of supply provided to retailers in the first quarter. Operational groundwater storage (volume of groundwater currently stored in the main basin above historical lows) has increased to approximately 116,000 AF (91% of usable storage) at the end of March 2017, based on groundwater level measurements. The total amount of groundwater storage is estimated at 244,000 AF. The estimated total pumping in 2017 is 3,500 AF. Zone 7 s initial Article 56 (Carryover) balance at the beginning of 2017 was 9,400 AF resulting from unused Table A in As San Luis Reservoir neared capacity in March, Zone 7 s remaining carryover was lost (7,050 AF). Zone 7 was able to utilize 2,350 AF in

179 Offsite groundwater banks (Semitropic and Cawelo) will not contribute water in 2017 because there are sufficient supplies. Instead, in the first quarter of 2017, Zone 7 sent 900 AF to Semitropic raising the balance to about 82,900 AF (after accounting for 10% loss). Zone 7 plans to store additional water in the banks later this year. Surface water outflow is estimated as natural runoff greater than roughly 10 cubic feet per second (cfs) of baseflow as measured at the USGS Arroyo de la Laguna at Verona (ADLLV) gauge, which captures all runoff leaving the Northern Alameda Creek Watershed. Note that flows out of the Tri-Valley are mandated for other downstream benefits. Watershed outflow is estimated at 164,500 AF (i.e., flows above the 10 cfs baseflow) this quarter (January through March). This was due to 15.9 inches of rainfall in January - March. The year-to-date outflow of 164,500 AF, compared to 29,700 AF in calendar year 2016, represents an increase of over 400% in runoff in just three months of Attachment 1 provides a schematic summary of water supply and use in the Livermore-Amador Valley, including groundwater pumping by the retailers and recycled water irrigation in lieu of potable water use. B. Treated Water Demands For planning purposes, Zone 7 is assuming 20% conservation based on 2013 demands or 39,400 vs 49,300 acre-feet. Of this amount, about 34,500 represents treated water production. Local demands for treated water increased about 20% between February and March to 1,690 AF, which is 57% of March 2013 demands. Surface treated water made up 92% of the water supply in March. The Del Valle Water Treatment Plant (DVWTP) and the Patterson Pass Water Treatment Plant (PPWTP) together produced an average of 16.2 MGD, with wells supplying 1.5MGD. The daily treated water production values for March 2017 are shown on Figure 1. Figure 2 compares surface water versus groundwater production amounts for March Figures 3a and 3b present a monthly summary of treated water production (MGD and AF, respectively) for March 2017, compared to values. For the period of March 1-31, Zone 7 conservation is about 40% relative to 2013 demands. As of the end of March 2017, 4,600 AF of treated water has been produced. 5

180 Table 2. Water Inventory for Zone 7 Water Agency (Acre-Feet) (March 2017) Note: Values Are Rounded Q Q Q Q YTD Jan-Dec Jan-Mar Apr-Jun Jul-Sept Oct-Dec Jan-Dec Supply SWP Deliveries From Table A 39, From SWP Carryover 6,400 2,350 2,350 From Groundwater Bank Carryover 7, Zone 7 Groundwater Pumping 1, Local Surface Water (LDV) 100 2,150 2,150 Supplemental Water (MYPP/Yuba) Surface water recovered from offsite banks Total Supply 55,480 5,430 5,430 Demand 1 Municipal Water 28,460 4,390 4,390 Untreated Water 4, Recharge (to local GW storage) 10, Recharge (to Kern GW Banks) 12, Total Demand 55,480 5,430 5,430 AVAILABLE WATER SUPPLIES Incoming Supplies (Amount Remaining) Table A Allocation (60%) 48,400 48,400 48,400 Turnback Pool and Yuba Accord 500 1,200 1,200 Storage (End of Period) Local GW Basin (Above Historical Low) 2 103, , ,000 Offsite Groundwater banks 3 82,100 82,900 82,900 LDV Storage 8,900 13,200 13,200 SWP Carryover Balance 4 9, Groundwater Bank Carryover Balance Total Storage 203, , ,100 Watershed Conditions Precipitation-Liv (in) Surface Water Outflow (AF) 6 29, , ,500 1 Includes a small amount of unaccounted for water 2 Groundwater estimate based on most recent groundwater level data. 3 Beginning Balance 82,100 AF, Jan SWP Carryover balance includes Article 56 water stored in San Luis Reservoir. 2,350 AF was used and the remainder (7,050 AF) as of March 7 has been lost. 5 Groundwater Bank Carryover balance includes Semitropic and Cawelo water stored in San Luis Reservoir. 6 Surface Water Outflow is estimated based on flow at USGS gage Arroyo De La Laguna at Verona. 7 Reported deliveries are subject to verification per DWR. 6

181 Figure 1. Daily Treated Water Production for March 2017 Figure 2. Surface Water (blue) versus Groundwater Production (brown) for March

182 Figure 3. Monthly Summary of Treated Water Production expressed as a) MGD, b) AF for Calendar Year 2017 a. Note: Although the February average production rate as MGD increased from January, monthly production volume was less due to the fewer number of days in February. b. 8

183 C. SWP Conditions Lake Del Valle storage levels are shown on Figure 4. After Labor Day weekend, lake releases are made to create adequate space for storm water runoff for both water supply and flood risk management. Prior to summer months, the lake elevation is raised as needed for recreational purposes. The conservation pool designates the amount of water that can be stored for water supply purposes. In 2016, DWR filled the lake to 40,000 AF, which marks the Top of Conservation pool. DWR released water intermittently for various purposes as needed throughout the summer. In October 2016, DWR began making steady releases to serve the SBA contractors. The lake level began 2017 at 691 elevation. By the end of March 2017, storage in the lake increased to 39,400 AF (702.2 elevation). Releases will continue from the lake into the SBA to maintain water levels. Zone 7 currently has a claim to about 13,200 AF of local watershed runoff stored in the lake. An estimated 800 AF will inevitably be lost to evaporation throughout the year. Tabular information regarding Lake Del Valle operations by DWR can be found at the following website: Graphical information on lake storage can be found at the following website: Figure 4. Lake Del Valle Storage for Water Year 2017 YTD 9

184 The Northern Sierra precipitation is critical as it determines DWR s ability to refill Lake Oroville, which is the primary source of SWP water for Zone 7 (water is released from Lake Oroville into the Feather and then the Sacramento River and from there it is conveyed through the Delta by a series of levees that direct Oroville releases to the Banks Pumping Plant which brings water to the Livermore-Amador Valley and other SWP contractors). Precipitation in the Northern Sierra totaled 6.8 inches in March The water year to date precipitation total is 201% of average as of March 31 (Figure 5), tracking wetter than the wettest water year ( ). Updates to this figure can be downloaded daily via web link at: Figure 5. Northern Sierra Precipitation 10

185 On March 31, 2017, the storage level at Lake Oroville was around 2,672,547AF (Figure 6). This storage level represents a decrease of more than 33 TAF in March and currently holds 77% of total capacity, lower than last year s at this time of year. In March, Lake Oroville filled to levels that required DWR officials to make flood releases to maintain adequate space for impending inflows. Repairs to the damaged main spillway and the emergency spillway are ongoing as well as sediment removal from the channel. In March, approximately 70,000 AF were released for flood management in coordination with spillway repair efforts. Lake Oroville storage levels can be tracked on the DWR data website at Figure 6. Lake Oroville Storage Levels, Water Year

186 On March 31, 2017, the storage level at San Luis Reservoir was 2,014,762 AF, near reservoir capacity, and almost double that of last year s level at this time (Figure 7). The current storage level represents an increase of about 23 TAF in March and as of April 1 holds 99% of San Luis Reservoir s total capacity and 109% of the historical average. The reservoir filled faster than during the water year, the wettest year on record. San Luis Reservoir storage levels can be tracked on the DWR data website at Figure 7. San Luis Storage Levels, Water Year

187 ATTACHMENT 1: Livermore-Amador Valley Water Supply & Use 13