CC 2021-09-14_10a CCB Participation_Water Supply AlternativesMEMORANDUM
TO: CITY COUNCIL
FROM: WHITNEY MCDONALD, CITY MANAGER
BILL ROBESON, ASSISTANT CITY MANAGER/PUBLIC WORKS
DIRECTOR
SHANE TAYLOR, UTILITIES MANAGER
SUBJECT: CONSIDERATION OF PARTICIPATION IN CENTRAL COAST BLUE
PROJECT AND PRELIMINARY DISCUSSION OF WATER SUPPLY
ALTERNATIVES
D ATE: SEPTEMBER 14, 2021
SUMMARY OF ACTION:
Consider and provide direction regarding participation in the Central Coast Blue Project
(Project), including a revised framework for agreements governing cost-sharing and
operations of the project in partnership with the cities of Pismo Beach and Grover Beach.
Additionally, consider a preliminary report of water supply alternatives available to the
City and provide direction to staff regarding further analysis of identified alternatives.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
The City’s Biennial Budget for Fiscal Years 2021-23 includes a total of $1,420,000 in the
Water Availability Fund for the Project, $720,000 for Fiscal Year 2021-22 and $700,000
for Fiscal Year 2022-23. The proposed framework governing cost-sharing and operations
of the Project requests that the City make an immediate payment of a portion of pre-
construction costs to the City of Pismo Beach as the parties continue negotiating final
agreements contemplated in the framework. It is recommended that Council consider
approving a contribution of $86,000 toward satisfying this request to bring the City’s
current contributions to the same amount provided to date by Grover Beach. The
framework also acknowledges that the City’s share of the Project will be lower than the
39% (or 40.67% while 5% of the Project remains unsubscribed) previously discussed
between the parties, which will lower the City’s total costs for participation in the Project.
RECOMMENDATION:
It is recommended the City Council 1) consider authorizing the City Manager to negotiate
a cost-sharing agreement and a Joint Powers Agreement governing the City’s
participation in the Project consistent with the framework provided in Attachment 1; 2)
authorize the immediate contribution of $86,000 to the Project from the Water Availability
Fund for pre-construction costs; and 3) receive a preliminary report identifying water
supply alternatives that may be available to the City and provide direction to staff
regarding further analysis of identified alternatives.
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SEPTEMBER 14, 2021
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BACKGROUND:
Central Coast Blue
The City of Pismo Beach is the lead agency for the Central Coast Blue Project. The
Project has been a multi-agency effort between three of the four Northern Cities
Management Area agencies (the Cities of Arroyo Grande, Grover Beach, and Pismo
Beach) and the South San Luis Obispo County Sanitation District (SSLOCSD) to
construct a regional recycled water project that will enhance supply reliability by injecting
advanced purified water into the Santa Maria Groundwater Basin (SMGB). The Project
will reduce vulnerability to drought and seawater intrusion by creating a seawater intrusion
barrier and supplementing the naturally occurring groundwater.
On March 23, 2021, Council considered a proposed Central Coast Blue Operating
Agreement and its associated environmental determination in compliance with the
California Environmental Quality Act. Under the proposed Operating Agreement, costs
for the Project were allocated as follows:
PROJECT Contributing
Water Purveyors
Cost Share
Percentage
Arroyo Grande 39%
Grover Beach 36%
Pismo Beach 20%
Unsubscribed 5%
Total 100%
Until a contributing water purveyor could be identified for the unsubscribed portion noted
above, the Water Purveyor Contribution percentages were proposed as follows:
PROJECT Contributing
Water Purveyors
Cost Share
Percentage
Arroyo Grande 40.7%
Grover Beach 37.7%
Pismo Beach 21.7%
Total 100%
After receiving public comment and conducting discussion and deliberation on March
23rd, Council approved the Operating Agreement and adopted Statements of Overriding
Considerations and a Mitigation, Monitoring, and Reporting Program, subject to the
condition that the cities of Pismo Beach and Grover Beach separately agree to enter into
a Community Workforce Agreement for construction of the Project.
Following Council’s action on March 23, 2021, the cities of Pismo Beach and Grover
Beach indicated that they would not agree to the Community Workforce Agreement
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condition. Additionally, certain questions and concerns emerged during discussions with
the cities regarding the proposed Operating Agreement terms.
At its April 13, 2021 regular meeting, Council considered a staff report outlining these
questions and concerns and, after deliberations, took action to rescind its conditional
approval of the Operating Agreement and directed the City Manager to draft a letter to
the City Councils of Pismo Beach and Grover Beach requesting that certain items be
address in the proposed Operating Agreement.
In addition, Council approved a letter of support for the Project to the Bureau of
Reclamation in consideration of the WaterSMART Title XVI Water Reclamation and
Reuse Grant (Title XVI WRRG) application. Through the application prepared and
submitted by the City of Pismo Beach for this grant opportunity, the Project was awarded
an additional $1.7 million in grant funding on August 5, 2021. To date, $4,496,094 in
federal and State grants have been awarded to fund the Project.
Letters to the City Councils of the cities of Grover Beach and Pismo Beach were sent on
April 16, 2021, consistent with Council’s April 13th direction. On May 24, 2021, letters were
received from the City Managers of Grover Beach and Pismo Beach responding to the
City’s April 16, 2021 letter. Council considered the two letters at its regular meeting held
on June 8, 2021. After deliberation, Council unanimously approved the following motion:
Mayor Pro Tem Paulding moved to respond affirmatively to the letters
received by Pismo Beach and Grover Beach, acknowledge their response,
and ask them, respectfully, to provide a revised operating agreement that
substantively addresses the two concerns the City raised, and until such
time that our City Manager receives the revised draft, our City as an
organization and City Council will not be willing to entertain engaging in cost
contributions related to the project; and authorize City Manager discretion
to negotiate the terms
Following this action, the city managers for Arroyo Grande, Grover Beach, and Pismo
Beach worked to develop a new framework for cost-sharing and operating agreements
for the Project. This framework is provided in Attachment 1 and described in more detail
below.
On September 7, 2021, Water Systems Consulting, Inc. (WSC) submitted an application
seeking approximately $28.6 million in grant funding from the Proposition 1 Groundwater
Grant Program (Prop 1 GWGP) administered by the State Water Resources Control
Board. If awarded, these grant funds will provide funding for more than 50% of the costs
of constructing the Project. Updated Project cost estimates were prepared as part of the
Prop 1 grant application and WSC has supplied the following updated estimated total
Project costs, as well as the total costs to participating agencies when accounting for
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previously-awarded grants, and the total potential grant funding opportunities for the
Project:
Overall Costs
Total Project Costs $56,681,853
Grant or outside
agency funding
contributions spent to-
date
$2,489,576 Prop 1 GWGP (Round 1),
Zone 3 Reserves,
SSLOCSD EIR
Contribution
Awarded and Unspent
Grant Funds
$2,496,094 Title XVI WRRG
Total Participating
agency obligations
$51,696,183
Future Grant Opportunities
Prop 1 GWGP (Round
3)
$28,625,746 Submitted concept
proposal and waiting on
invite to apply
Title XVI WRRG $11,220,526 Project can apply to future
funding opportunities and
receive 25% cost share of
eligible costs up to $20Mil
Total Future Grant Opportunities $39,846,272
Total Participating Agency
Obligation after Potential Grant
Funds
$11,849,911
Water Supply Alternatives
When the City last completed a comprehensive General Plan update in 2001, water
supplies were identified as a significant constraint. In response, the City commissioned
an analysis of water supply alternatives, resulting in a report completed in 2004. That
Water Supply Alternative Study, prepared by the Wallace Group and provided in
Attachment 2, identified a number of potential options to supply additional water to the
City. Those options included the following short-, intermediate-, and long-term projects:
• Short-term (2004-2009)
o Allow the cemetery to drill a well for irrigation water
o Additional wells in the Pismo Groundwater formation
o Purchase State Water from the County
o Additional Groundwater Entitlement
o Purchase Private Well Water
o Lease State Water
o Reclaimed Price Canyon Oil Field Water
o Water Conservation
• Intermediate-term (2010-2014)
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o Additional Stormwater Basins
o Increased Lopez Entitlement
o Nacimiento Project
• Long-term (2015-2020)
o Desalination
o Recycled South San Luis Obispo County Sanitation District (SSLOCSD)
Water (Secondary-23)
o Recycled SSLOCSD Water (Tertiary)
Other projects that were considered but not evaluated further included a Nacimiento/State
Water Project exchange and Conoco-Phillips Refinery Well Water. Since completion of
the Study, the City implemented a number of the identified projects. For instance, two
additional wells were installed in the Pismo Groundwater formation (Wells 10 and 11),
and a number of water conservation measures have also been implemented, and
continue to be implemented, by the City and its customers. Additional stormwater basins
have also been installed, including low-impact development measures and underground
storage and reclamation facilities.
Discussions regarding the City’s participation in the Central Coast Blue Project and its
planning for and response to the current drought have made it prudent to again evaluate
options and alternatives for new water sources for the City. Much has occurred since the
2004 Study and new options may now be available to the City that deserve further
consideration to ensure reliable water sources into the future. The City has engaged a
consultant, MKN Associates (MKN), to update the 2004 Study. This staff report identifies
the preliminary list of alternatives that MKN is included in its analysis, which is underway.
ANALYSIS
Central Coast Blue Framework
The new framework developed by the managers of the three cities proposes to negotiate
two agreements that would govern cost-sharing among the three cities and operations of
the Project upon completion of construction. Similar to the prior proposed Operating
Agreement, Pismo Beach would retain the role of lead agency for purposes of developing
and constructing the Project. However, unlike the prior Operating Agreement, a Joint
Powers Authority would manage operations of the Project following completion of
construction.
Importantly, the framework acknowledges the parties’ intent that the cost-sharing
arrangement previously proposed in the Operating Agreement would be altered to lower
Arroyo Grande’s share of the Project. While the outcome of this process would lower the
amount of water attributed to the City from the Project, it will also lower the costs of the
Project to the City and help address concerns regarding disproportionate decision-making
authority during the pre-construction and construction phases of the Project. As described
in Attachment 1, the proposed allocations among the parties has not yet been established
and would be subject to further negotiation. Additional information is provided below
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regarding the City’s current water supplies and a potential recommendation for the City’s
share of the Project.
Key terms identified in the proposed framework include:
• City of Pismo Beach remains lead agency and acts as project developer through
final completion of Phase 1 of the Project.
• Costs will be shared by the three cities in proportion to their share of the benefits
(water) allocated to the jurisdiction.
• The allocation of costs/shares will be subject to further negotiation among the three
cities, with acknowledgement that Arroyo Grande’s share will be lower than 39%
(discussed further below).
• Joint meetings of the three City Councils are contemplated to:
o Consider the cost-sharing agreement and JPA agreement;
o Discuss implementation of local hire provisions prior to procurement; and
o Provide a venue for discussion and transparency for the public on the
project progress, to receive project updates, and discuss policy issues as
needed (e.g. unexpected timeline extensions, approvals of expenditures
beyond the project budget, etc.).
• Opt-out clause will be included in the cost-sharing agreement to allow exit of a
party prior to award of a construction contract as long as the identified share of
costs incurred to date are paid by that party.
• Technical Advisory Committee made up of staff from the three cities will meet
monthly and provide reports at the joint City Council meetings.
• Each City Council will review and approve the scope, budget, contingency and
procurement for the remainder of pre-construction and construction phases of the
Project, and costs in excess of the agreed-upon budget, plus the approved
contingency.
• Prior to construction, the cities would form a Joint Powers Authority (JPA) that
would become effective at completion of construction for the purpose of long-term
ownership, operation and maintenance of the facilities post-construction.
o The JPA Board of Directors would consist of one representative of each city
with each member retaining an equal vote on the Board.
o The JPA will own all Project assets and contract/employ operations and
administrative staff.
o A Technical Advisory Committee consisting of staff representatives from the
three cities will meet and provide input into operations.
• The cost-sharing agreement and JPA agreement will not impose groundwater
pumping limitations on participating parties but will recognize the participants’
contribution of new water for their exclusive use.
• Arroyo Grande will be requested to make an immediate contribution toward pre-
construction costs incurred by Pismo Beach and Grover Beach in developing the
Project to date (discussed further below).
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• The Arroyo Grande City Council will have an opportunity to consider the proposed
operating agreement and the proposed JPA agreement before the agreements are
approved by the other two cities.
Contribution to Current Pre-Construction Costs
As mentioned above, the proposed Project framework included in Attachment 1 requests
that the City make a payment of a portion of the pre-construction costs incurred by the
City of Pismo Beach to date to support the development of the Project. The precise
amount and basis for calculating the payment are not specified in the framework, but the
intent of the request is to help offset the significant outlay that Pismo Beach has made to
study, plan, design, and seek funding for the Project, which will benefit the entire
groundwater basin.
To date, the City of Pismo Beach has expended approximately $1.5 million toward the
Project, not including the cost to purchase the land for the future site of the advanced
treatment plant located in the City of Grover Beach. WSC reports that the City of Grover
Beach has contributed $210,000 toward Project pre-construction costs, covering a portion
of the costs for Phase 2 Engineering, Interim Project Management services, and Prop 1
Concept Proposal and Preliminary Engineering services. Arroyo Grande has contributed
a total of approximately $124,000 toward the costs associated with Phase 2 Engineering
services and Interim Project Management services. It is recommended that Council
authorize the immediate contribution of an additional $86,000 to the Project, bringing the
City’s contributions to a level that is equivalent to Grover Beach’s. Any cost-sharing
agreement for the Project that is approved by the parties will account for this contribution
toward pre-construction costs.
Current Water Supply and Demand
If directed to pursue participation in the Project consistent with the proposed framework,
City staff will immediately engage in negotiations with the cities of Grover Beach and
Pismo Beach to develop the two agreements described in the framework, including
finalizing Arroyo Grande’s share of the Project and its costs. In developing the City’s
approach to this issue, it is important to identify the City’s anticipated future water supply
needs. Currently, the City’s water sources consist of the following: surface water from
Lopez Reservoir, groundwater from the Santa Maria Groundwater Basin, and
groundwater from the Pismo Formation.
The City’s current Urban Water Management Plan identifies the following projected water
supply conditions (Table 6-4) as well as supply and demand totals for the City’s water
users during multiple dry years through 2020 (Table 6-7):
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The Northern Cities Management Area (NCMA) 2020 Annual Report describes the City’s
total available supply as follows:
The City’s actual consumption in 2020, on the other hand, is reported as follows:
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(“Other supplies” identified in the NCMA Report tables above refers to the production of
water from wells in the Pismo Formation, which is not part of the Santa Maria
Groundwater Basin. While the 2015 Urban Water Management Plan anticipated available
supplies in this formation to reach 200 AFY by 2020, the City will need to bring one
additional well online to enable this level of pumping. Currently, the City’s wells can
produce approximately 160 AFY from the Pismo Formation.)
These tables reported in the NCMA’s 2020 Annual Report indicate that the City’s available
water supplies exceeded demand by approximately 2,367 acre feet. In addition, this
information indicates that the City’s projected water needs may be lower than anticipated
in the 2015 Urban Water Management Plan, even when considering anticipated new
water demand from development as estimated in the Plan.1
Two issues may interfere with what appears as an encouraging picture of the City’s water
supplies and demand projections. The first is the current drought being experienced in
California and the Central Coast region, which has resulted in low water levels at the
Lopez Reservoir. These low water levels recently triggering the Low Reservoir Response
Plan (LRRP) enacted by the San Luis Obispo County Flood Control and Water
Conservation District, Zone 3, which oversees management of the reservoir. This plan
will reduce the City’s Lopez deliveries by 10% (229 acre-feet) and require the City to enact
additional conservation measures, to be considered by the City Council at a future noticed
public hearing. The second issue surrounds the potential constraints on the availability of
groundwater within the Santa Maria Groundwater Basin. Although the City retains the
right to 1,323 acre-feet per year of groundwater from the Basin, concerns about the
potential for seawater intrusion caution against using this full entitlement. The City, like
the other NCMA agencies, has pumped significantly less than this full entitlement for the
past ten years, in part, to help safeguard the basin from the threat of seawater intrusion.
The Central Coast Blue Project will help address the threat of seawater intrusion by
injecting recycled water into the basin at key locations near the seawater interface. Phase
1 As contemplated in applicable regulations, the City will update its Urban Water
Management Plan within the next year and incorporate any changes to projected supply
and demand at that time. In addition, the update to the Water Supply Alternatives
Report discussed later in this staff report will include estimates of current projected
demand in order to aid further consideration of alternative sources of supply.
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1 of the Project proposes to treat wastewater from the City of Pismo Beach to an
advanced purification level to create between 900-1,000 acre-feet of additional water per
year. This new developed water will help to ensure that a sufficient barrier exists within
the basin to keep sea water from flooding into the aquifer and contaminating the wells
used by the NCMA parties. As a result, the Project will support the City’s ability to rely on
groundwater to supply water to its residents and businesses into the future. It should be
noted, however, that full implementation of the Project will not avoid the reductions in
Lopez Reservoir deliveries required under the LRRP, nor the water conservation
measures that will be discussed at a future noticed public hearing, as mentioned above.
Although these drought measures will still occur, the Project will secure an additional
source of water for the City to help offset reductions in Lopez deliveries.
In light of these considerations, staff recommends pursuing participation in the Central
Coast Blue Project consistent with the proposed framework described in Attachment 1. It
is further recommended that the City seek a share of the Project that is roughly equivalent
to anticipated reductions in other water supplies that the City may experience in the time
of drought. A participation share of 25% would secure an estimated 225-250 acre-feet
per year of reliable groundwater for the City and would cover a 10% reduction of Lopez
deliveries.
Preliminary Water Supply Alternatives Report
As the City experiences constraints on its existing water sources, such as reduced Lopez
deliveries during drought or limited groundwater pumping practices to address seawater
intrusion concerns, the City may wish to pursue additional water supply projects to ensure
sufficient supply into the future. While the Central Coast Blue Project will help to safeguard
the groundwater basin from seawater intrusion, additional water supply projects may be
needed to provide consistent, resilient resources for the City’s customers.
As described above, MKN is working to update the 2004 Water Supply Alternatives Study
on behalf of the City. New alternatives may now be available to the City due to a number
of new developments and changes in circumstances in the region. MKN has developed,
in coordination with City staff, a list of potential water supply projects that will be evaluated
further in an updated study, as described in more detail in Attachment 3. Below is a
summary of the contemplated alternatives, including identification of any known
constraints for each alternative.
State Water – Long-term or Short-term
The City could purchase or lease State Water from the County of San Luis Obispo
(County), County of Santa Barbara, or current State Water recipients, such as the Oceano
Community Services District (OCSD). In March 2021, the County approved amendments
to its Water Supply Contract with the State Department of Water Resources that may
facilitate increased or new purchases of State Water through the County.
• Preliminary constraints include:
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o In 2016, the voters approved a ballot measure allowing the City to purchase
State Water only during times of water shortage emergencies.
o Costs to purchase State Water can be prohibitively expensive depending
on the contractor. For instance, some State Water Project contractors
require purchasers to pay a pro rata portion of the costs of constructing the
pipelines necessary to bring the water to the area. In some instances, this
requires new purchasers to pay significant costs to buy into the project.
Ultimately, the purchase price is subject to negotiation. The 2021 Water
Supply Alternatives Study will evaluate and discuss these issues in greater
detail.
o Annual State Water deliveries vary widely based on water supply
availability.
Oceano Community Services District
The City could seek a temporary water supply agreement with the OCSD for a portion of
its available surface water sources, such as State Water or Lopez Reservoir water. A
similar agreement was entered into in 2009 that expired in 2015 which provided the City
up to 100 AFY at a cost of 105% of the OCSD’s Lopez water costs. Under the prior
agreement, the City was required to pay for the water even if it was not actually taken or
used by the City. Current Lopez water costs for the OCSD are $1,674 per acre-foot.
• Preliminary constraints include:
o The City is limited in its ability to purchase State Water from OCSD pursuant
to its existing ordinance, adopted by ballot measure.
o OCSD is limited in it is ability to sell water permanently to the City pursuant
to an ordinance adopted by initiative in its jurisdiction. As a result, the City
could not rely on the OCSD as a permanent water supply source.
Interagency Connections
Adding connections with Nipomo Community Services District (NCSD), Golden State
Water, or others could improve emergency supply options or could provide opportunities
for long term water purchase. The NCSD is continuing to make progress toward
completion of its Supplemental Water Project, which will bring at least 2,500 AFY of
municipal blend water from the City of Santa Maria to the Nipomo Mesa. The NCSD’s
purchase agreement with the City of Santa Maria allows the NCSD to purchase up to
6,200 AFY, leaving the potential for other buyers to seek excess water from the NCSD.
• Preliminary constraints:
o Currently, the license agreement issued to the NCSD from the Santa
Barbara County Flood Control District for the pipeline across the Santa
Maria River contains a restriction on the amount of water the NCSD may
transport through the pipeline each year. Although the pipeline is sized to
accommodate 6,200 AFY, the license does not allow the NCSD to transport
more than 3,000 AFY across the river.
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Nacimiento Project
Nacimiento Water Supply Project water could be available from the County or from
current partners through an exchange for State Water. In this alternative, Nacimiento
Water would be “wheeled” through State Water customers’ systems to the City.
• Preliminary constraints include:
o Several agreements would be necessary, including from the County or other
current parties to the Nacimiento Project as well as all other parties whose
pipelines would be used to deliver the water.
o Costs are unclear, as are willing or interested parties.
Central Coast Blue
The details, benefits, and constraints related to this Project are discussed in detail above.
Recycled Water “Scalping Plant” Concept
A satellite water treatment facility would be constructed near a City sewer main (ex. Fair
Oaks Avenue near AG High School) to treat flows for local irrigation use, in exchange for
reduced groundwater pumping by customer(s).
• Preliminary constraints include:
o Long-term agreements would be necessary with owners of agricultural
operations near the proposed facility to ensure long-term use of the
recycled water. To benefit the City’s water supplies, the agreements would
need to include provisions limiting groundwater pumping equivalent to the
recycled water received.
o Diversion of wastewater to a scalping plant may impact a future Phase 2 of
the Central Coast Blue Project, which would use wastewater from the
SSLOCSD treatment plant for injection into the groundwater basin.
Water Conservation
Existing water conservation programs, efforts, and requirements could be expanded to
reduce demand and thereby increase availability of existing water sources.
• Preliminary constraints include:
o Arroyo Grande water customers have already implemented several
measures to conserve water and have reduced per capita demand
dramatically since the 2004 Study was completed.
o Reduction in water use results in reduced revenue to the water enterprise
fund, which increases strain on the City’s ability to continue providing
service without increasing water rates.
Stormwater Capture
Capturing additional runoff and allow it to percolate into aquifers or storing it for irrigation
usage could augment the City’s groundwater supply. This may take the form of new
retention basins or modifications to existing basins and may require new pipelines and
other appurtenances to make the water available for reuse.
• Preliminary constraints include:
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o The amount of water that will be reused, saved, or made available to the
City or its customers may be minimal.
o Space constraints may impact the ability to implement stormwater capture
projects that would create the largest benefit to the City.
MKN will pursue further evaluation of these alternatives, including preliminary cost
estimates to the extent possible, and develop a final report for presentation to Council. It
is anticipated that the final report will be available in November 2021. It is recommended
that Council receive input from the public and provide feedback and direction regarding
the list of alternatives described above, which will be incorporated into the report.
ALTERNATIVES:
The following alternatives are provided for Council's consideration:
1. Approve staff’s recommendation to (1) authorize the City Manager to negotiate a cost-
sharing agreement and a Joint Powers Agreement governing the City’s participation
in the Project consistent with the framework provided in Attachment 1; (2) authorize
an immediate contribution to the Project in an amount up to $86,000 from the Water
Availability Fund for pre-construction costs; and (3) receive a preliminary report
identifying water supply alternatives that may be available to the City and provide
direction to staff regarding further analysis of identified alternatives.
2. (1) Authorize the City Manager to negotiate cost-sharing and operating agreements
governing the City’s participation in the Project with terms other than those described
in Attachment 1; (2) do not authorize an immediate payment of Project-related costs
or authorize a payment to the City of Pismo Beach in an amount directed by Council;
and (3) receive a preliminary report identifying water supply alternatives that may be
available to the City and provide direction to staff regarding further analysis of
identified alternatives.
3. Provide other direction to staff.
ADVANTAGES:
Approving staff’s recommendation will support the City’s participation in the Central Coast
Blue Project and enable staff to negotiate cost-sharing and operating agreements that will
better meet the City’s needs. The Project is important for the ongoing resiliency of
groundwater resources relied upon by the City, as well as all residents, businesses,
agricultural operations, and visitors to the Five Cities area. Approval of a payment to the
City of Pismo Beach for prior costs incurred to develop the Project will support studies
and analyses benefitting the basin as well as the Project. Receipt of the preliminary report
of water supply options will provide information regarding new alternatives that the City
may wish to pursue to ensure ongoing water supplies to customers.
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DISADVANTAGES:
Funding approved through staff’s recommended action to the City of Pismo Beach would
likely not be recoverable if the parties do not reach final, approved cost-sharing and
operating agreements for the Project.
PUBLIC NOTIFICATION AND COMMENTS:
The Agenda was posted at City Hall and on the City’s website in accordance with
Government Code Section 54954.2.
Attachments:
1. Central Coast Blue Project Delivery and Governance Framework – DRAFT
2. 2004 Water Supply Alternatives Study
3. Preliminary List of 2021 Water Supply Alternatives – DRAFT
Item 10.a. Page 14
Central Coast Blue Project Delivery and Governance Framework - DRAFT
The outline below reflects a conceptual framework for delivering Central Coast Blue. In this model, the
City of Pismo Beach remains Lead Agency and acts as project developer through final completion of the
advanced water purification facility and required infrastructure (“Facilities”). Costs would be shared by
the participating agencies (“Participants”) in proportion to their share of the benefits. The City of Pismo
Beach would maintain project accounting and will invoice the other Participants consistent with their
share of the overall project.
Prior to project construction, the Participants would form a Joint Powers Authority (“JPA”) that would
become effective at completion of construction for the purpose of long-term ownership, operation and
maintenance of the Facilities post-construction. The City of Pismo Beach would transfer ownership of
the Facilities to the JPA after construction completion, start-up and commissioning.
Prior to initiating construction, the Councils for each Participant would have the ability to review the
scope, schedule and budget of the project, including contingency, and consider it for approval. If all
Participant Councils approve the project to proceed, the City of Pismo Beach would be responsible for
delivering the scoped project within the approved budget and schedule.
During project design and construction, the three City Councils will meet jointly at least once but no
more than twice per year to provide a venue for discussion and transparency for the public on the
project progress, to receive project updates, and discuss policy issues as needed (e.g. unexpected
timeline extensions, approvals of expenditures beyond the project budget, etc.). A Technical Advisory
Committee made up of staff of the three cities designated by the City Managers will meet monthly to
discuss matters related to scope, schedule and budget of the project. The Technical Advisory Committee
will prepare a joint report to the Participant Councils for consideration at the joint City Council meetings.
Any change in scope, schedule or budget would require approval by all three Participant Councils.
Pre-Construction/Construction Agreement
Cost share agreements developed amongst Participants for equitable cost sharing of Pre-
Construction and Construction Phases (Implementation)
o Cost sharing percentages to be altered and negotiated among the three cities
Arroyo Grande share to be reduced as determined through further negotiations
among the three cities
Scope, Budget, Contingency and Procurement for remainder of Pre-Construction and
Construction Phases approved by each of the Participants upon execution of Pre-
Construction/Construction Agreement
o Cost in excess of agreed upon budget, plus contingency, would require approval of all
three Participant City Councils
o Opt-out available prior to award of project construction contract
Any Participant exercising the opt-out clause would be responsible for their Cost
Share Percentage for project costs to date and any currently outstanding
contracts
Pismo Beach is lead agency and procures and manages contracts with consultants and
contractors
Attachment 1
Item 10.a. Page 15
Meetings of the three City Councils
o Pismo Beach Staff/Consultants will provide reports to the three City Councils
o The three City Councils will review and make recommendations to Pismo Beach as the
Lead Agency
o At least one public meeting will be held prior to procurement to discuss methods for
implementing local hire provisions, including discussion of various agreements
Technical Advisory Committee consisting of Staff representatives from the Participants meets
monthly (non-Brown Act) to oversee and provide input into project Implementation
Identify intent to treat CCB water as “New Development Water” under the terms of the 2005
Stipulation, section IV.E.
Operations
Joint Powers Authority (JPA) Governance structure formed prior to completion of construction
o JPA takes over ownership of project assets and contracts/employs operations and
administrative staff
o JPA Consists of a 3 Member Board of Directors (BOD)
Equal Director voting rights equal
BOD meets Bi-monthly or Quarterly (Brown-Act Meetings)
Technical Advisory Committee consisting of Staff representatives from the Participants meets
monthly (non-Brown Act) to oversee and provide input into operations
Other Issues of Concern/Needs
Pumping limitations – The cost-sharing agreement and JPA will not impose groundwater
pumping limitations on participating parties but will recognize the Participants’ contribution of
new water for their exclusive use. Any proposed groundwater pumping limitations will be
addressed through amendments to the NCMA Management Agreement.
Arroyo Grande will make an immediate contribution toward pre-construction costs incurred by
Pismo Beach and Grover Beach in developing the project
Consideration of cost-sharing agreement and Joint Powers Agreement by the three City
Councils:
o At least one joint meeting of the three City Councils will be held to consider the
proposed cost-sharing agreement and the proposed Joint Powers Agreement
o The Arroyo Grande City Council will hold at least one meeting to consider the proposed
cost-sharing agreement and the proposed Joint Powers Agreement prior to the joint
meeting described above and prior to approval of the agreements by the City Councils
of Grover Beach and Pismo Beach.
Item 10.a. Page 16
City of Arroyo Grande
Water Supply
Alternatives
Study
,.:if CITY OF
,-k�Ai'\
,..._...._
August24,2004
CITY OF ARROYO GRANDE
PUBLIC WORKS DEPARTMENT
Attachment 2
Item 10.a. Page 17
The City of Arroyo Grande Water Supply Alternatives Study was prepared under the
direction of the following registered engineer.
Prepared by:
Thomas K. Zehnder RME #29572
Professional Consulting Engineer
Prepared By WALLACE GROUP, a Callfomla Corporation
San Luis Obispo, CA
8/1912004
Item 10.a. Page 18
Water Supply Alternatives Study Page 3
City of Arroyo Grande
Water Supply Alternatives Study
Table of Contents
I. General Study Background 4
Introduction 4
Water Supply 5
Water Demand 6
Selection Criteria for Viable Supply Alternatives 6
II. Evaluation of Viable Alternatives - Short Term Implementation (2004-2009) 7
1. Allow Cemetery to Drill Private Well for Irrigation Water 7
2. Additional Wells in Pismo Groundwater Formation 7
3. Purchase State Water - Santa Barbara County 8
4. Purchase State Water from the County 9
5. Additional Groundwater Entitlement 9
6. Purchase Private Well Water 10
7. Lease State Water 11
8. Reclaimed Price Canyon Oil Field Water 11
9. Water Conservation 12
III. Intermediate Term Implementation (2010-2014) 14
1. Additional Stormwater Basins 14
2. Increased Lopez Entitlement 15
3. Nacimiento Project 16
IV. Long Term Implementation (2015-2020) 18
1. Desalination 18
2. Recycled SSLOCSD Water (Secondary-23) 18
3. Recycled SSLOCSD Water (Tertiary) 18
V. Review of Alternatives Considered but not Further Evaluated 20
1. Nacimiento/State Water Exchange 20
2. Conoco-Phillips Refinery Well Water 20
VI. Summary with Recommendations 21
Short Term 21
Intermediate Term 21
Long Term 22
VII. References 23
8/19/2004
Item 10.a. Page 19
Water Supply Altematives Study Page 4
I. General Study Background
Introduction
The City has identified the need to obtain additional water availability to meet the projected
needs of the City. The objective of this assessment of Water Supply Alternatives is to identify
one or more short, intermediate and long term supply alternatives that meet the City's objectives
for water quantity, quality and reliability. Short-term alternatives are ones that may be
implemented immediately or within a five-year period with a minimum of complexity and cost.
Intermediate term alternatives are ones that may be implemented within the next ten years and
have a higher level of complexity and cost. Long-term alternatives are ones that may be
implemented within the next ten to fifteen years and have a high level of complexity and cost.
Background
During the development of the City's Urban Water Master Plan and 2001 General Plan, water
resources was identified as a significant issue. A number of potential methods to address this
issue have been identified. The purpose of this report is to provide a preliminary analysis of
each alternative, prioritize alternatives, and seek City Council direction to proceed with further
study of those options determined to be most desirable, feasible and cost effective.
The Integrated Program EIR for the 2001 General Plan considered water resource deficiency a
significant impact without apparent mitigation. According to the EIR, this was due to the fact
that groundwater quantity can be substantially impacted by development in the County fringe
areas and because supplemental sources such as Lake Nacimiento or State Coastal Aqueduct
Project water resources were unresolved. As a result, it required a Statement of Overriding
Considerations per CEQA.
The document stated that until more accurate estimates of safe annual yield of groundwater and
formal allocation of resources are accomplished; the potential exists for over-drafting the
estimated basin capacity. It also stated that the City may be approaching the safe annual yield
and City entitlements of existing water resources if the City does not achieve reduced per capita
consumption. The 1990 General Plan only assumed 80% of maximum build-out and therefore
estimated that existing water resources could serve the potential development based on that
assumption. The 2001 General Plan EIR instead identified use of storm water retention and
possible re-use of treated wastewater for park and/or agriculture irrigation as possible mitigation
measures. The 2001 General Plan proposed to reduce per capita consumption to a maximum
of 160 gallons per person per day through more efficient water utilization and conservation
measures. Lastly, "it also assumed upgrade of the City's water storage and distribution system
and indicated that the City would reflect changes to regional water resources available to the
City by periodic amendment to the City's Water Master Plan.
Water use is difficult to accurately project because it fluctuates substantially based primarily on
weather patterns. As a result, staff recommends that in addition to water conservation, methods
to increase water supply be considered in order to increase long-term reliability of the City's
water service to its residents. The more the City can diversify its water supply, the more
security can be provided against interruptions and shortages.
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Item 10.a. Page 20
Water Supply Alternatives Study Page 5
Water Supply
The City obtains' its water supply from groundwater and the Lopez Reservoir. A total of six wells
Well No's 1, 3, 4, 5, 7 & 8), extract water from the Arroyo Grande Plain/Tri-Cities Mesa (ACP-
TCM) Sub-basin of the Santa Maria Groundwater Basin. As part of the Basin Management
Agreement entered into by the City of Arroyo Grande, Grover Beach, Pismo Beach and Oceano
CSD (formerly known as the Gentlemen's Agreement), the City is limited to groundwater
extractions of 1,202 AFY plus additional groundwater through the conversion of agricultural
land. In addition, Well No.9 extracts water from a separate basin source, the Pismo Formation.
The City also receives a yearly allocation of 2,290 AFY of water from the Lopez Reservoir
administered by the County of San Luis Obispo Flood Control District.
The City's total available current supply is 3,688 AFY with the following breakdown:
Groundwater - ACP- TCM Sub-basin with agricultural land conversion - 1,298 AFY
Groundwater - Pismo formation, Well #9 - 100 AFY
Lopez reservoir - 2,290 AFY
During the 2003 calendar year the actual water use by the City was 3,517 AF as follows:
Groundwater - ACP-TCM Sub-basin - 1,248 AF .
Groundwater - Pismo formation Well #9 - Minimal operation
Lopez reservoir - 2,269 AF (2,290 AF use based upon the County of San Luis Obispo
Water year)
The current remaining buffer of 171 AF is available based upon 2003 usage:
Groundwater - Pismo formation Well #9 - 100 AFY (pumping started 3/04)
Groundwater - ACP-TCM Sub-basin with agricultural land conversion - 50 AFY
Lopez reservoir - 21 AFY
Water Demand
The City's current per capita use is 184 gallons per day. The water demand for the City is
primarily for residential use, which accounts for approximately 80% of total water consumption.
The 1999 City of Arroyo Grande Water System Master Plan indicated a historic water demand
range of 151-197 gallons per capita per day (gpcd). The study estimated that for a future
population of 18,500, the Average Daily Demand (ADD) would be 3,590 AFY based upon a per
capita water use of 173 gpcd for planning purposes. The Year 2000 Urban Water Management
Plan projected for a population of 20,000 in 2020 an ADD of 3,780 AFY. This was based upon
a per capita water use of 175 gpcd for planning purposes.
The General Plan assumes a per capita consumption of 160 gallons per day which is optimistic
and is based upon assumed conservation efforts. For planning purposes, if a rate of
consumption of 175 gpcd was utilized as in the past in conjunction with a projected City
population of 20,000 at General Plan buildout, it was estimated that approximately 3,920 AFY of
water resources would be required. Therefore, based upon conservation efforts reducing
demand to 175 gpcd, and with a current supply of 3,688 AFY, it is proposed that the City should
target the acquisition of an additional 232 AFY of water to supply the build out population.
8/19/2004
Item 10.a. Page 21
Water Supply Altematives Study Page 6
The additional supply needed would increase to 624 AFY if a 10% contingency were added to
the per capita use to account for higher housing densities, fluctuations due to weather
conditions and the time of year and year-to-year fluctuations, and other conditions that may
impact usage, in order to increase future reliability and security. Therefore it is recommended
the City target as a goal, 230-625 additional AFY of water supply/availability.
Selection Criteria for Viable Supply Alternatives
As a result of the need for additional water sources, a preliminary analysis of water supply
alternatives was performed to consider the reliability, barriers to implementation, costs, and
advantages of a variety of potential new water sources. The potential options were then
screened and prioritized. aased upon this preliminary analysis, 17 alternatives were selected for
further evaluation. The selection criteria that were used to determine the range of viable
sources of water, included: the reliability and yield of the sources, anticipated costs, as well as
environmental and regulatory issues associated with these sources.
8/19/2004
Item 10.a. Page 22
Water Supply Alternatives Study Page 7
II. Evaluation of Viable Alternatives - Short Term Implementation (2004-2009)
A total of nine short-term alternatives were evaluated that could be implemented immediately or
within a five-year period with a minimum of complexity and cost.
1. Allow Cemetery to Drill Private" Well for Irrigation Water
Backqround
The Arroyo Grande Cemetery District uses potable water for large-scale irrigation. If the City
allowed the District to drill a private well, the City could gain approximately 38 AFY of supply at
no cost to the City. At build out of the Cemetery, water use could rise to 48 AF. There would
however be a revenue loss to the City.
Infrastructure
The necessary infrastructure would include a new well, interconnect piping and electrical
equipment to be installed by the Cemetery District.
Costs
The intent is that all the costs associated with this alternative would be borne by the District.
The net cost to the District, which would include the amortized well cost, operating and
maintenance costs, would have to be less than the current and future District water rates to
make it financially attractive and therefore viable.
Additional Considerations
The schedule to implement this option would be less than a year. There are no anticipated
permitting issues other than the County of San Luis Obispo Health Department associated with
this option. The use of well water for this use would require District and City Council approval.
The water quality and reliability would be adequate for its intended use, as it would come from
the same groundwater basin that the City currently uses.
2. Additional Wells in Pismo Groundwater Formation
Backqround
The City currently extracts approximately 100 AFY of groundwater from Well No, 9 in the Pismo
Formation. The City is currently exploring the possibility of drilling a well at the Deer Trail site
Well #10), which would draw from the Pismo formation. The well production is anticipated at
between 160 and 240 AFY. The basin is considered to be low yield and with a lower water
quality when compared to other groundwater.
In adoition, the potential also exists to use an existing active well that draws from the Pismo
formation to serve Rancho Grande Park with a current water demand of approximately 30 AFY.
The well is owned by Castlerock Development and is used to supply construction water. The
City may have the ability to obtain the well and install a pipeline to serve the Park or drill a
separate well at the park for irrigation purposes.
Infrastructure
The necessary infrastructure for the Deer Trail well would include a new well, treatment plant,
interconnect piping and electrical equipment, all of which is currently planned by the City with an
8/19/2004
n__
Item 10.a. Page 23
Water Supply Alternatives Study Page 8
estimated cost of $425,000. The Rancho Grande Park option would require the City to obtain
the well and the construction of the pipeline or drill a separate well.
Additional Considerations
The schedule to implement these options would be approximately two years. There are no
anticipated permitting issues other than the County of San Luis Obispo Health Department
associated with either option. The water quality and reliability would be adequate for its
intended use.
3. Purchase State Water - Santa Barbara County
Backaround
State Water is an appropriate water source in terms of quality and reliability. However because
of the State Water Project pipeline capacity constraints, the City is limited in the amount of water
it could obtain from a State Water contractor north of Arroyo Grande. If the City were to
purchase water from a contractor south of the City, the pipeline is already sized to
accommodate the flow.
Reliabilitv
State Water Project deliveries are subject to the availability of water through precipitation. The
Department of Water Resources (DWR) delivery estimates are based upon runoff projections,
actual reservoir storage, contractor requests and system operating constraints. At times
deliveries can be as little as 30% of the entitlement. There exists however the ability to
purchase "drought insurance water" at an additional cost from the County of San Luis Obispo
and DWR by over subscribing the allotment up to 100% of the contract amount as long as the
delivery capacity is still available.
State water is treated and could be fed directly into the existing Lopez pipeline downstream of
the Lopez Water Treatment Plant (WTP). State water is offline one month per year. As a result
demand will need to be balanced out with additional groundwater or Lopez water.
Reauired Infrastructure
Initial discussions with the County have indicated that there is adequate capacity in the Lopez
pipeline for additional flow, however this must be confirmed with an engineering study. In
addition, the potential exists through off peak pumping to deliver the additional water through
the pipeline. This capacity issue would apply to all options that would require the use of the
pipeline, specifically additional State Water, Nacimiento Water and "additional entitlements of
Lopez Water.
Costs
Entering into a permanent entitlement agreement with an agency south of the City would likely
require taking over all or a portion of the fixed and variable components including sunk costs of
State Water which would be greater for an agreement with a southern agency because of the
extended length of pipeline (i.e., the City would likely have to pay for a portion of the costs
associated with the pipeline that extends south of Arroyo Grande).
Some State Water Contractors have expressed possible interest in selling excess state water.
State water may be available in San Luis Obispo County from the previous Pismo Ranch
development (140 AFY) however, the City of Pismo Beach has first right of refusal to purchase
this water and the likelihood of an "outside" purchase is low. The possibility exists to purchase
8/19/2004
Item 10.a. Page 24
Water Supply Alternatives Study Page 9
approximately 400 AFY of state water from a contractor in Santa Barbara County. The cost
would be approximately $1400/AF plus buy in costs.
Additional costs would include the addition of new reservoir capacity and/or potential costs to
confirm the capacity of the Lopez pipeline. As the State Water Project and CCW A bonds are
paid off in 2035 and 2020 respectively, the water delivery cost could change. However, due to
project development water rights defined in the Water Code allocations shouldn't change.
Reauired Aareements
The transfer of water from the State Water Project is a complex and time consuming process
due to the fact that approvals are required from a variety of agencies, including the entitlement
holder, State Water Project contract holder, DWR and Central Coast Water Authority (CCWA).
Agencies participating in the State Water project in Santa Barbara County may be willing to
relinquish a portion of their capacity in the pipeline, which the City might obtain. Entitlements in
San Luis Obispo County may also be available. Additional discussions with both Counties
would have to be initiated to determine the extent of water that may be available.
Additional Considerations
The schedule to implement this option would be several years. There are no anticipated
permitting issues associated with this option other than those associated with pipeline
improvements if required and CEQA processing for the project. Any agreement in which the
City enters into purchasing State Water would require voter approval per City of Arroyo Grande
Measure A.
4. Purchase State Water from the County
There is an additional 20,170 acre-ft available frqm the County of San Luis Obispo, however,
there is no additional capacity to convey it. Currently, there is 100 AFY available from Shandon,
all of which is spoken for with 85 AFY for Santa Margarita (CSA 8), and 15 AFY for a
development in the Avila area through CSA 12. In discussions with the County of San Luis
Obispo, there is no excess State Water available above that which is allocated to the County of
San Luis Obispo given the pipeline capacity constraint. However, there was a report completed
by Brookman-Edmonston in 1994 that indicated there might be an additional 2,830 AFY of
capacity in the pipeline. Discussions with the County of San Luis Obispo have indicated that the
only method at this time to increase the amount of water available would require a detailed
engineering evaluation to determine that the system is hydraulically capable of delivering more
water.
The County has begun discussions with CCW A to obtain a larger quantity of water for San Luis
Obispo County, which could result in a potential additional water supply for the City.
5, Additional Groundwater Entitlement
Backaround
In accordance with the Basin Management Agreement entered into by the City of Arroyo
Grande, Grover Beach, Pismo Beach and Oceano CSD (formerly known as the Gentlemen's
Agreement), the City is limited to groundwater extractions of 1,298 AFY. The participating
agencies have agreed to comply with the agreement as a method of. establishing equality of
basin use and to potentially aid in resolution of the current litigation over the groundwater basin.
The City could legally extract an additional 2,290 AFY from the. basin but doing so would require
8/19/2004
Item 10.a. Page 25
Water Supply Alternatives Study Page 10
opting out of the existing Agreement. This is based upon the fact that the City is utilizing its
Lopez entitlement rather than using its total groundwater entitlement.
Reauired Aareements/Leaal Issues
The initial decision of the judge in the Santa Maria Basin groundwater litigation is that the basin
is not in an over draft condition, thereby allowing the additional pumping of groundwater. There
is ongoing groundwater monitoring of the basin. The potential exists that in the future should an
overdraft condition develop, the court may impose water management limitations restricting the
amount of groundwater pumping.
In order to pump additional groundwater in the ACP-TCM Sub-basin, the agencies could agree
to alter the Management Agreement. The first step would be to perform a hydrogeologic study
of the sub-basin to determine if excess groundwater exists. If the study determines that the safe
yield is greater than previously determined, extractions contained in the Management
Agreement could potentially be modified to the new safe yield. The language in the agreement
states that in the event of an increase in the safe yield, the Urban Parties (City of AG and other
Cities) would be entitled to 43% of the increase in extraction. Of the first 378 AFY available to
the Urban Parties, the City would have a first right of refusal of 358 AFY.
Costs
The associated costs of this option include basin studies and negotiating and updating existing
agreements, as well as the costs associated with pumping the additional water. It is estimated
that due to the availability of existing data from previous studies the potential cost of the study
would be on the order of $25,000 and require four months to complete. There is reserve
pumping capacity on the existing wells. In addition, there is the potential that either larger
pumps or new wells could be needed to deliver the additional flow.
Additional Considerations
If the additional entitlements were available, this alternative would be the most cost effective,
reliable and easily implemented long term supply solution since most of the infrastructure
already exists to extract the water.
6. Purchase Private Well Water
BackQround
Safe yield in the Basin Management Agreement is 5,300 AFY for applied irrigation use. In most
cases, agricultural groundwater extractions are not metered. Because the City cannot currently
increase its groundwater extractions, purchasing private well water would provide a means of
obtaining additional groundwater without opting out of the Basin Management Agreement. This
alternative would require the drilling of new private wells to meet Health Department
requirements, as well as the construction of treatment and pipeline infrastructure.
Costs
The costs associated with this option are dependant upon the location of the new wells that
would be drilled and their respective distance to the City's water system.
Additional Considerations
Given that this basin is the City's current source, water quality and reliability would be consistent
with current use. The schedule to implement this option would be less than two years and would
be dependant upon the location of source wells in terms of cost and timetable to construct. The
main anticipated environmental permitting issues associated with this option would be possible
8/19/2004
Item 10.a. Page 26
Water Supply Alternatives Study Page 11
pipeline routes across environmentally sensitive areas. The required agreements and legal
issues would be associated with developing supply agreements with the landowners.
7. Lease State Water
Backaround
Current State Water contracts allow for direct agreements between agencies for short-term (3-5
years) sales of surplus water. Although not a permanent solution, leasing is an option,
sometimes described as a multi-year sale. It has problems on a large scale with some State
Contractors, but on the Central Coast, the County of San Luis Obispo feels that with a willing
buyer and a willing seller it could work. It is generally unacceptable for land use planning
purposes and may violate State law for providing water for new development depending on the
specifics. As a temporary source of water, it could be utilized until the long-term source is
secured.
Additional Considerations
The costs, and required infrastructure would be similar to a long-term contract for state water
with the drawback that this source would only be available as an interim source. The schedule
to implement this option would be less than two years. There are no anticipated permitting
issues associated with this option. Any agreement in which the City leases state water might
require voter approval per City of Arroyo Grande Measure A.
8. Reclaimed Price Canyon Oil Field Water
Backaround
The process of oil production at Price Canyon Oil Field involves the treatment of a significant
amount of water that is produced with the crude oil. This water, known as produced water, must
be treated and disposed of back into the oil-producing reservoir. Invariably this water is
produced again with subsequent oil production. By dewatering the oil reservoir, less water must
be treated and disposed of, which results in a cost savings. The oil field operator Plains
Exploration and Production Company (Plains) is evaluating options to treat the produced water
for disposal into Pismo Creek as well as other options including the sale of water to area
vineyards and local agencies. The County of San Luis Obispo is currently in discussions with
Plains and is preparing a feasibility study for utilizing this reclaimed water to offset Lopez
deliveries by discharging the water into Arroyo Grande Creek.
Water Qualitv/Reliabilitv
This source. can only be considered a short-term supply due the fact that the source of water is
tied into the commercial production of oil and therefore tied to the price of oil, oil production
levels and the viability of the oil field and its operator. It is estimated that there is at least a 10-
year supply available with anticipated flows of 730 AFY. The water would be available by
January 2006, although the required pipeline infrastructure may not be in place.
This water would be "exchanged" to offset Lopez water presently released for downstream
habitat and fisheries. It is anticipated that the water will be treated to agricultural standards and
not to potable levels. The primary reason for this is the legal liability associated with the human
consumption of the water. The water would most likely be suitable for discharge into Arroyo
Grande Creek to offset groundwater recharge and steel head enhancement flows from Lopez.
One issue that may arise with the use of oil field reclaimed water is that by diluting the Lopez
reservoir and Arroyo Grande Creek water with reclaimed water, the water quality and
8/19/2004
Item 10.a. Page 27
Water Supply Alternatives Study Page 12
associated fingerprinting that steel head use to find Arroyo Grande Creek for spawning purposes
may be compromised. From April to December, the recommended discharge rate from Lopez
as shown in the recent Habitat Conservation Plan (HCP) draft is equivalent to reservoir inflows,
which could be as low as 180 acre-ft per month. With a potential flow of 60 acre-ft per month of
reclaimed water into the creek, the water quality characteristics may be affected. It is unknown
at this time if this is a major issue that could result in a reduction in the amount of reclaimed
water that could be released and as a result exchanged with Lopez water.
Reauired Infrastructure
The necessary infrastructure would include the construction of a treatment plant at Plains, a
pump station, and a cross-country pipeline. The potential pipeline route would run along Price
Canyon Road to Highway 227, along Corbett Canyon Road to Tiffany Ranch Road and then to
Orcutt Road. The alignment would then be along Orcutt Road adjacent to the State Water
Project to a discharge point into the Arroyo Grande Creek at the base of Lopez Dam.
The additional exchanged water from Lopez would need to be treated at the Lopez WTP and
conveyed in the Lopez pipeline. The treatment capacity of the Lopez WTP is currently 6.0 MGD
and after the upgrade could potentially handle 6.7 MGD. The City's proportional capacity
increase would be approximately 0.35 MGD or 400 AFY. The capacity of the Lopez pipeline
would also need to be investigated and possibly increased consistent with the use of State
Water discussed previously.
Cost
The County of San Luis Obispo is completing a cost analysis for routing a pipeline from Plains
to Arroyo Grande Creek. This cost would include treatment to a non-potable level, and the
necessary pipeline and treatment infrastructure. Plains would pay all costs associated with the
project and charge for the water delivered on an acre-foot basis. The preliminary cost of water
according to the County of San Luis Obispo would be $500/AF for 730 AFY delivered at Lopez.
Any. additional water above the 730 AF would be available at a reduced cost. There may be an
additional cost of $350/AF to cover costs associated with treating and transporting the
exchanged Lopez water.
Environmental Permitting/CEQA
An EIR would be required for the pipeline alignment, however, locating the new pipeline along
the existing State Water pipeline route along Orcutt Road could minimize the extent of the EIR.
There would be additional permitting associated with water quality and how the water quality
would affect the HCP for Arroyo Grande Creek. The County of San Luis Obispo would permit
the pipeline while Plains would complete all other permitting.
Reauired Aareements/Leaallssues
It would appear that the County of San Luis Obispo through Flood Control Zone 3 would be the
lead agency on the project. Required agreements would involve various landowners along the
right of way, Plains, County of San Luis Obispo Departments (Health, Zone 3, Planning), Fish
and Game and other agencies. The County of San Luis Obispo would own the pipeline after
7,300 AF has been delivered.
9, Water Conservation
The City has started implementation of the recently adopted Water Conservation Program.
Overall, the water savings is anticipated to be 10% of usage. The first phase includes the
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Item 10.a. Page 28
Water Supply Altematives Study Page 13
plumbing retrofit program. The actual water savings realized from this phase will not be
determinable for approximately one year from initiation of retrofits. It is anticipated that this
phase of the program could save 100 AFY. Phase 2 would involve irrigation retrofits, which
would further increase water savings. The downside of water conservation is the decrease in
revenue to the City.
It may be advantageous to accelerate the implementation of an irrigation retrofit program at the
Cemetery and Rancho Grande Park to reduce usage. With a combined usage of 65 AFY, a 10-
15% reduction could result in up to 10 AFY savings.
The City could implement the water conservation measures that are outlined in section
13.05.010 of the City Municipal Code. These measures have not been implemented to date
because the City is pursuing other water supply alternatives and they are intended to be
temporary measures.
Additional options include adopting the modified water rate structure that the City previously
considered but did not implem~nt and/or approaching other local cities to purchase a short term
ground water allotment. Several cities are not using their entire groundwater allotment and
might be interested in selling the unused portion on a short term basis.
8/19/2004
Item 10.a. Page 29
Water Supply Alternatives Study Page 14
III. Intermediate Term Implementation (2010-2014)
A total of three intermediate-term alternatives were evaluated that may be implemented within
the next ten years and have a higher level of complexity and cost.
1. Additional Stormwater Basins
Backaround
The City currently utilizes stormwater basins at the Soto Sport Complex for irrigation purposes.
The potential exists to construct or modify other existing stormwater basins to serve as storage
sources for storm water that could be used for irrigation purposes. The resulting reduction in
potable water use for irrigation would increase the amount available for domestic use. The
identified users would be Rancho Grande Park, the Arroyo Grande Cemetery District and
potentially the Caltrans ROW. The combined use of these three users is approximately 75 AFY.
The feasibility of using an existing storm water basin to provide irrigation water is contingent on
sufficient storage capacity, its location and ideally its ability to gravity flow water to the user. It
would appear that there are three existing basins that could be considered candidates to
provide irrigation water to the Arroyo Grande Cemetery District and Caltrans; Grand
Ave/Courtland St., Poplar Street and Five Cities Center. The Poplar Street basin is an
infiltration basin with an original capacity of 15 AF that has been increased and is located
approximately }-2 of a mile southwest of the Cemetery. Grand Ave/Courtland St., is an
infiltration basin with a capacity of 5.7 AF and is located approximately % of a mile west of the
Cemetery. The Five Cities Center basin is a private retarding basin with a capacity of 6.4 AF
and is located approximately }-2 of a mile northwest of the Cemetery. With the exception of the
Central Coast Center basin, all basins are located hydraulically downhill of the Cemetery and
would require pumping.
Given the location of Rancho Grande Park, it would appear that there are no existing basins that
could be effectively used to provide irrigation water. As part of previous development in this
area, detention basins have been constructed. If the basins were converted to storage basins,
additional detention capacity would be required to be constructed. The cost of these
improvements would be borne by the City.
The larger issue with the use of infiltration basins is that for the proposed use, they would have
to function in a dual role. During periods of wet weather they would store and infiltrate water as
quickly as possible to provide capacity for future flows. Unfortunately, during these periods
there is little to no need for irrigation. Conversely, as the rainy season is ending, the basins
would convert to reservoirs, ideally be full and not infiltrate stormwater. Currently, the Poplar
Street basin has an infiltration rate approaching 6"/day. This results in a very short storage
solution that is only available for several weeks after a major rain event, a period that does not
require significant irrigation. Both infiltration basins are needed to infiltrate storm water and
could not be converted into storage basins.
The use of the Five Cities Center basin as a retarding basin must be maintained. Therefore,
new basins must be created elsewhere, or capacity increased to offset its conversion to a
storage basin. In either case, there is a significant cost associated with its use.
Since Zone A requires additional stormwater storage capacity, one option would be to construct
a new basin near the Cemetery that would provide needed drainage capacity as well as provide
a source of irrigation water for the Cemetery.
8/19/2004
Item 10.a. Page 30
Water Supply Alternatives Study Page 15
Costs
For this option to be competitive; the combined capital and operating costs must be less than
other options. Improvements to existing basins would include the cleaning and lining of the
basin and the construction of distribution infrastructure, pipeline, pumps etc. as well as basin
maintenance. Given the limited volume, use and value of beneficial use of the storm water, the
capital costs of the new construction of a basin that was not associated with a new development
may be prohibitive.
Additional Considerations
From a permitting standpoint, in the event that there exists protected wildlife, as is the case with
the Five Cities Center, it would significantly complicate the use of the basin.
2, Increased Lopez Entitlement
Backaround
Current contracts for Lopez Water state that any surplus water will be allocated between each of
the participating agencies based upon their proportionate share of participation in the project,
currently 50.55% for the City. Although current studies are being conducted that may indicate
that the safe yield of the reservoir has increased, at this time the amount of surplus water that
can be purchased is limited until the Habitat Conservation Plan (HCP) for the Arroyo Grande
Creek is completed.
Water Qualitv/Reliabilitv
Historically, the City has purchased surplus water from the Flood Control District. However this
water supply has not been available for several years due to the seismic remediation project
and is not considered a reliable supply.
If the resource agencies adopt the HCP as proposed, then the Flood Control District would be
able to continue to meet the full contractual deliveries, including the promised habitat releases,
and historic agricultural releases. Adoption of the HCP is anticipated in approximately 3-5
years. Once the HCP is adopted, the participating agencies could request a review of the safe
yield and increased amount be converted to a firm entitlement. This would result in a potential
entitlement of 650 AFY for the City.
Required Infrastructure
The additional water would need to be treated at the Lopez WTP and conveyed in the Lopez
pipeline as discussed in detail previously in the Reclaimed Oil Field Water Alternative.
Required Aareements
This option would require County of San Luis Obispo approval as well as adoption of the HCP.
Costs
The current cost of surplus water from Lopez is approximately $350/AF. Further additional costs
associated with this option include improvements to the Lopez WTP and capacity improvements
consistent with those facilities required by the use of Reclaimed Oil Field Water discussed
previously.
8/19/2004
Item 10.a. Page 31
Water Supply Alternatives Study Page 16
3. Nacimiento Project
Backaround
The Nacimiento project will provide 15,750 AFY of raw water to the County of San Luis Obispo.
At this time 9,630 AFY has been allocated to the communities of Paso Robles, Atascadero,
Templeton and San Luis Obispo with 6,120 AFY remaining unallocated.
The project is currently terminating at the City of San Luis Obispo Water Treatment Plant with a
small diameter branch extending through the City of San Luis Obispo to serve the airport area.
There has been no design consideration or EIR for an extended reach to serve communities in
the South County via the Lopez Reservoir. In order to reach the Lopez Reservoir, additional
design development and a Supplemental Environmental Impact Report (SEIR) would be
required. In addition to the City of Arroyo Grande, other agencies have expressed an interest in
considering a potential extension of the Nacimiento project to serve the South County.
There are two options for the City to receive Nacimiento water. One option would be for the City
of San Luis Obispo to treat the water. The treated water would then be pumped via pipeline to a
connection point with the Lopez pipeline directly downstream of the Lopez WTP. The other
option would be to increase the size of the raw water branch line that will extend to the airport
area of San Luis Obispo, construct a pipeline to the Lopez WTP and then treat the water in the
Lopez WTP.
Project costs will be less if the City participates in the project during its inception. The City has
already contacted the County to indicate the City is interested in reviewing the project and
considering potential participation.
Water Qualitv/Supplv Reliabilitv
Nacimiento water is anticipated to be between Whale Rock and Santa Margarita water in
quality. It will require local treatment in as much as no centralized treatment plant is proposed.
The supply is considered long term with the required amount available. In terms of operational
reliability, it is anticipated that there will be scheduled shutdowns of up to a month every 2-3
years. As a result there must be a backup supply during this period. Due to preexisting water
agreements, the County of San Luis Obispo considers the Nacimiento water supply reliability to
be very high.
Infrastructure
One scenario would utilize existing City of San Luis Obispo infrastructure along Johnson
Avenue to the intersection of Johnson and Orcutt Road. A new pipeline would then be
constructed along Orcutt Road to a connection point with the Lopez pipeline downstream of the
Lopez WTP. One constraint is the capacity of the existing City of San Luis Obispo water
infrastructure, as the water would be wheeled through the City. Initial discussions with the City
have indicated that the recently upgraded Johnson Avenue waterline may be of sufficient
capacity to deliver the required quantity.
The other scenario involves increasing the size of the raw water branch line that is proposed as
part of the Nacimiento project to begin near the' City of San Luis Obispo WTP and extend to the
airport area. A new pipeline, which has not been defined in the Nacimiento EIR, would extend
along Highway 227 from the intersection of Los Ranchos Road and Highway 227 to Biddle
Ranch Road. It would continue along Biddle Ranch Road and then south on Orcutt Road to a
connection point with the terminal reservoir at the Lopez WTP.
8/19/2004
Item 10.a. Page 32
Water Supply Alternatives Study Page 17
Depending upon the longevity of the Plains reclaimed water supply and the construction timing
of the Nacimiento extension to the South County, one option could be to utilize the Plains line
should it be constructed as part of the Nacimiento extension. This would only be viable if Plains
were to stop shipping water to Lopez. In that scenario, the Nacimiento extension pipeline would
only need to be constructed along 227 from the Los Ranchos Road intersection to the Price
Canyon Road intersection, a much shorter distance. An additional benefit of this approach
would be that the necessary Supplemental EIR could reference the Plains EIR with potential
cost and time savings.
The capacity of the Lopez pipeline would also need to be increased consistent with the use of
State Water discussed previously. In fact the demand on the pipeline may even increase
beyond State Water requirements as a result of other Flood Control District customers utilizing
Nacimiento Water.
Schedule
According to County Staff, Nacimiento water would be available to the City by 2011.
Costs
The anticipated raw water cost is $1,800/AF with an additional cost for treatment and
conveyance. The total water cost would be between $1,800 and $3,300/AF. In the event other
parties participated in the project, the overall project cost could be shared. The potential parties
include other Zone 3 customers, Edna Ranch, Tiffany Ranch, Varian Ranch, several wineries,
the Biddle Ranch development as well as the vineyards in the Edna Valley depending if the
water was raw or treated.
Additional Considerations
The treated water scenario would require a wheeling agreement with the City of San Luis
Obispo.
8/19/2004
Item 10.a. Page 33
Water Supply Alternatives Study Page 18
IV. Long Term Implementation (2015-2020)
A total of three long-term alternatives were evaluated that may be implemented within the next
ten to fifteen years and have a high level of complexity and cost.
1. Desalination
Backaround
Several local agencies have constructed or are considering desalination facilities including
Morro Bay (built in 1992) and Cambria (proposed) at costs of $5.4 million and approximately
10.3 million, respectively. Both facilities provide (or are planned for) approximately 500 AFY.
The Kennedy/Jenks 2003 report of the Evaluation of Water Supply Alternatives for Cambria
estimated the cost of desalination at $600 to $1,000 AFY due to its proximity to the ocean.
Proiect Considerations
One possibility may be a joint venture between South County agencies to share the capital
costs of a regional facility. Grover Beach and other agencies have expressed a potential
interest in participating in such a project. An advantage of such a joint venture would be access
to a coastal location not within the City's boundaries. The Kennedy/Jenks 2001 report of the
Evaluation of Water Supply Alternatives for Nipomo estimated the cost of desalination at $3,000
to $4,000 AFY to provide Nipomo with water, in addition to significant environmental issues
associated with a new ocean outfall.
2, Recycled SSLOCSD Water (Secondary-23)
Backaround
The use of recycled water is dependent upon its quality and its ability to offset potable water use
by providing non-potable water to users that do not demand potable water quality. Secondary-
23 recycled water from SSLOCSD could be used for restricted landscape irrigation. No
additional plant improvements would be required other than the construction of pumping
facilities and a transmission pipeline.
Proiect Considerations
As identified in the Water Recycling Status Report (JLWA 2001), the SSLOCSD has available
approximately 2,250 AFY of recycled water. However the Secondary-23 market is very small,
specifically for Cemetery and freeway landscaping at a combined use of 45 AFY. The
estimated cost of this option in 2000 dollars would be $1.4 million including pipeline
infrastructure with a recycled water cost per AF of $3,800. While evaluating the needs of
surrounding communities could increase this market, the costs of treatment and transmission
most likely make this option cost prohibitive.
3, Recycled SSLOCSD Water (Tertiary)
Backaround
As identified in the Water Recycling Status Report (JLWA 2001), a significant upgrade to the
SSLOCSD plant would be required in order to allow for unrestricted use of treated wastewater.
There are two levels of upgrade; the first level would be to upgrade effluent quality to tertiary
standards with the second level of treatment involving demineralization.
8/19/2004
Item 10.a. Page 34
Water Supply Alternatives Study Page 19
Proiect Considerations
With the upgrade to tertiary standards, recycled water would be available to the SSLOCSD area
including Nipomo Golf Courses with an estimated use of 595 FY that would offset potable use.
The cost of the first level of treatment in 2000 dollars would be $16.3 million, including
transmission costs and result in a recycled water cost of $3,1 OO/AF.
Upgrading to tertiary standards and the use of demineralization would result in recycled water
being available for a wider variety of uses. Those uses include SSLOCSD area landscape
irrigation, TCM groundwater recharge, TCM agricultural irrigation and perhaps Arroyo Grande
Creek stream augmentation.
Depending upon use, the costs in 2000 dollars for the plant upgrade as well as
transmission costs would range from $25.6 million to $29.1 million with a cost of $4,900
to $5,200/AF at an available flow of 950 AFY.
8/19/2004
Item 10.a. Page 35
Water Supply Alternatives Study Page 20
V. Review of Alternatives Considered but not Further Evaluated
The following two options were considered but eliminated by the City and JLWA as either
infeasible or already in progress.
1. Nacimiento/State Water Exchange
This alternative would require the City to enter into a contract with the County of San Luis
Obispo to purchase water from the proposed Nacimiento Water Project. Since the proposed
project will only deliver Nacimiento water as far south as the City of San Luis Obispo, the City of
Arroyo Grande would need to establish alternate means of conveying the water to the City
system. This alternative would achieve the delivery of additional water via an agreement with a
current State Water Contractor that is not intending to bea Nacimiento Water Contractor, but
has the ability to receive Nacimiento Water under the proposed Nacimiento Water Project plan.
Arroyo Grande would actually receive the State Water and the other agency would receive the
Nacimiento Water utilizing existing infrastructure.
2. Conoco-Phillips Refinery Well Water
Discussions with representatives of the Conoco-Phillips refinery on the Nipomo Mesa have
concluded that it would not be a viable source of water. With the new development that is
occurring on the Mesa directly adjacent to their facility, they have concerns regarding the future
availability of well water. Their existing wells are experiencing increased draw down and they
need to redrill two wells that have lost production. As a result they are not in a position at this
time to either sell water or allow additional wells to be drilled on their site for export.
VI. Summary
The recommended sources of additional supply were broken down in terms of short term,
intermediate term and long term.
Short Term
Of the nine short term alternatives, it appears that an increase in ACP- TCM basin groundwater
production, the use of additional wells in the Pismo groundwater formation, the purchase of
surplus State Water from Santa Barbara County Contractors and/or the County of San Luis
Obispo and Water Conservation Measures are the best short term options in terms of
availability, timetable to initial use (less than two years) and cost.
The City could pump additional groundwater should a hydrological study of the basin indicate
that there is excess groundwater available. This would require approval of the other agencies in
the Basin Management Plan. The costs of this approach would be minimal and include only the
costs of the study and the additional energy to pump the water from the existing wells.
The use of additional wells in the Pismo formation would result in up to an additional 270 AF of
water a year. The 270 AF would be a combination of the new Deer Trail well (240 AF) that
would provide additional supply to the City and the existing Castle rock well (30 AF) that would
be used to irrigate Rancho Grande Park. This would meet the short-term needs of the City. The
costs associated with this option include drilling of the Deer Trail well and the installation of
8il9i2004
Item 10.a. Page 36
Water Supply Altematives Study Page 21
piping to interconnect the well to the City water system. The Castlerock well will require a
pipeline from the well to Rancho Grande Park.
Purchasing State Water from contractors in Santa Barbara County could result in an additional
supply of 400 AFY. Santa Barbara County contractors have expressed an interest in selling
State Water. The existing infrastructure, specifically the State Water turnout and Lopez pipeline
could be utilized to deliver this water. The cost of this water would be approximately $1 ,400/AF
plus buy in costs.
Purchasing State Water from the County of San Luis Obispo would be viable given that the
necessary infrastructure is in place and the water costs would be less than from Santa Barbara
County contractors. This option hinges upon the County of San Luis Obispo being able to obtain
a greater quantity of State Water through the analysis of the hydraulic capacity of the existing
system.
The City implementation of the Water Conservation Program is anticipated to decrease water
usage by 10% of usage. The first phase includes the plumbing retrofit program and could be
expanded to include changes in the water rate structure to increase water conservation. Phase
2 would involve irrigation retrofits, which would further increase water savings.
Intermediate Term
Of the three intermediate term alternatives, it appears that the potential increase of the Lopez
Entitlement and the use of Nacimiento water are the best intermediate options in terms of
availability, timetable to initial use and cost.
Given that Lopez supplies a significant amount of the City's water and the infrastructure is in
place, it would be the ideal source for additional water. If the resource agencies adopt the
Habitat Conservation Plan (HCP) for the Arroyo Grande Creek as proposed in the next 3-5
years then it appears that the Flood Control District would be able to make surplus water
deliveries resulting in an increase in the City's entitlement.
The additional water would need to be treated at the Lopez WTP and conveyed in the Lopez
pipeline. The current cost of surplus water from Lopez is approximately $350/AF. The additional
costs associated with this option include improvements to the Lopez WTP and capacity
improvements in the Lopez pipeline if required.
The Nacimiento project could be a viable alternative for a source of water by 2011. The County
is moving ahead with the project to deliver water to the northern portion of San Luis Obispo
County. There is currently a window of opportunity to extend the pipeline to the South County.
Given the existing scope of the project, coupled with the Plains project and/or a new pipeline
from San Luis Obispo to Lopez, Nacimiento water becomes a viable option for an additional
water supply. The estimated costs would range from $1,800 to $3,300 AFY.
Lonq Term
Of the three long-term alternatives, it appears that the use of desalination is the best long-term
option in terms of availability, timetable to initial use and cost.
8/19/2004
Item 10.a. Page 37
Water Supply Alternatives Study Page 22
The most probable desalination option would be the construction of a regional desalination
facility that would be utilized by several local agencies. Siting ideally would be near the ocean
to employ an ocean outfall with interconnecting piping required to tie into the existing
infrastructure. The estimated cost of desalination is $3,000 to $4,000 AFY in addition to the
cost of significant environmental issues associated with a new ocean outfall.
8/19/2004
M......"______~--
Item 10.a. Page 38
Water Supply Alternatives Study Page 23
VII, References
A variety of references were utilized in the preparation of this report. They include the
following:
Final Report - Evaluation of Water Supply Alternatives, Nipomo Community Services
District, October 2001, Kennedy/Jenks Consultants
Final Report - Evaluation of Long Term Water Supply Alternatives, Cambria Community
Services District, April 2003, Kennedy/Jenks Consultants
Progress Report - SSLOCSD Water Recycling, JLWA, February 2001
Lopez Water Distribution System Capacity Evaluation, Bookman-Edmonston, May 1999
Drainage Master Plan - City of Arroyo Grande, JLWA, November 1999
Water System Master Plan - City of Arroyo Grande, JLWA, July 1999
EIR - Nacimiento Water Project, MRS, December 2003
Final Draft - Arroyo Grande Creek HCP, Stetson Engineers, February 2004
Groundwater Management Agreement, June 2002
Southern District Report - Water Resources of the Arroyo Grande - Nipomo Mesa Area,
DWR, 2002
Year 2000 Urban Water Management Plan, City of Arroyo Grande, May 2001
8/1912004
Item 10.a. Page 39
2021 Water Supply Alternatives Study Update – Draft Long-Term Alternatives
Alternative Background Project Components Reported Cost References Comments
State Water – Long-
Term or Short-Term
City could purchase or lease State Water
from County of San Luis Obispo, County
of Santa Barbara, or current State Water
recipients.
Engineering study may be required to
confirm capacity of Central Coast Water
Authority pipelines. Additional pipelines
may be necessary depending on
partnering agency.
•$1400/AF + Buy in costs (2004 cost basis)
•Buy-in costs could be significant and
could include “sunk costs” by existing
participants
Water Supply
Alternatives Study
(2004, Wallace Group)
•Both Counties have been exploring new short-term
and long-term State Water agreements among
participants.
•Capacity studies in CCWA pipeline and SLO County
facilities have been conducted since 2004 and will
be reviewed in this study.
Oceano CSD – Short-
Term
City had an agreement for temporary
annual water purchase of 100 acre-feet
per year (AFY) dated March 1, 2009
through March 1, 2014. New agreement
could be developed.
Existing Lopez Pipeline System or
existing wells would be used to convey
water to the City.
105% of Lopez Water cost whether or not
any is used, minus $275 per AF of
groundwater actually used (from 2009
Agreement)
Temporary Water
Supply Agreement
Between the City of
Arroyo Grande and the
Oceano Community
Services District Dated
March 1, 2009
•Only Lopez Water or groundwater were allowed in
the 2009 Agreement.
•Agreement expired in 2014
•Oceano CSD has an ordinance preventing them from
long-term sale of water
Interagency
Connections
Adding connections with Nipomo CSD,
Golden State Water, or others could
improve emergency supply options or
could provide opportunities for long
term water purchase.
•Pipelines, metering facilities, and
appurtenances (length & alignment TBD)
•Pumping facilities and storage facilities
may be necessary
TBD N/A Initial discussions and review of infrastructure
locations will be necessary and will be conducted as
part of study.
Nacimiento Project
Nacimiento Water Supply Project water
could be available from the County or
from current partners through an
exchange for State Water.
Nacimiento Water would be “wheeled”
through State Water customers’ systems
to the City of Arroyo Grande.
TBD Water Supply
Alternatives Study
(2004, Wallace Group)
Contracts would be required for procurement of
State Water, exchange of Nacimiento Water, and
wheeling through partners’ distribution systems.
Central Coast Blue Potential joint venture between South
County agencies to construct a regional
recycled water facility to reduce
seawater intrusion, reduce ocean
discharge of treated wastewater, and
increase groundwater supply.
•Advanced water treatment facility in
Grover Beach
•Pumping facilities, storage, pipelines,
injection wells, and monitoring wells
•New production well
•Extraction pipelines and pumping may
be required if agricultural users are
included
City’s Share will be less than:
•$18.7M – Pre-Construction, property
acquisition, construction
•$919,000 – Operation & maintenance
•$687,000 – Debt service
•Staff report notes grants could
significantly reduce project costs
City Council Staff
Reports (March 23,
April 13, June 8,
September 14, 2021)
•Project governance options under review by
potential partners
•Phase I – Treatment of Pismo Beach WWTP effluent
only
•Phase II (Not included at this time) – Treatment of
SSLOCSD WWTP effluent
•Proposed share of total project costs TBD, less than
39%.
Recycled Water
“Scalping Plant”
Concept
A satellite water treatment facility would
be constructed near a City sewer main
(ex. Fair Oaks Avenue near AG High
School) to treat flow for local irrigation
use, in exchange for reduced
groundwater pumping by customer(s).
•Wastewater treatment facility with
influent pumping, membrane
bioreactor, disinfection, pumping, and
storage
•Additional treatment and brine disposal
pipelines may be needed depending on
desired level of quality
TBD June 24, 2021, Letter to
City Council (2021,
Hartman Engineering)
•400 AFY benefit proposed
•Feasibility study offered in letter.
•Preliminary costs to be developed as part of study.
•Similar concept to alternative proposed in 2016
Recycled Water Facilities Planning Study (2016,
WSC)
Water Conservation Expansion of water conservation efforts
could reduce demand.
N/A Cost may be minimal but revenue to
water enterprise would be reduced
N/A New ordinances or policies may be required
Stormwater Capture Capturing runoff and percolating into
aquifers or storing for irrigation usage
could augment groundwater supply.
•Retention basins or modifications to
existing basins
•Piping and appurtenances
TBD N/A City Community Development Department recently
conducted studies – to be reviewed.
Attachment 3
Item 10.a. Page 40