Water for Los Angeles County

Recommendations 13

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  10 Glendale Water and Power (GWP), Long Beach Water Department, Los Angeles Department of Water and Power (LADWP), Pasadena Water and Power Department, City of San Fernando Public Works Water, and the City of Santa Monica Water Department should support instructional literature and possible funding efforts for home purple pipe installations and gray water systems. Geographic Water Use To gain an understanding of water use, six LAC cities’ water departments were reviewed to see if they were targeting any specific geographic areas. The cities 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT 97 selected were Santa Monica, Glendale, San Fernando, Long Beach, Pasadena, and Los Angeles. None of the cities questioned targeted specific geographic areas at the current time. San Fernando targeted the top ten internal users for water and has achieved a 5% reduction in use. The city was planning to review the top ten external users of water. HOW WAS THE CITY OF SAN FERNANDO PUBLIC WORKS WATER WAS ABLE TO REPLACE 75% OF ITS WATER CONVEYANCE INFRASTRUCTURE?
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  Extraction Well Number 2. The NHOU-R2 was not expected to be operational until 2015. The NHOU-R2 would not address the lower concentration or secondary plume that had already escaped the NHOU zone of influence. Although the concentration of the secondary plume was low in terms of Superfund Clean-up targets, it was still too high in terms of a drinking water source. The California Department of Public Health considered this secondary plume an extremely impaired drinking water source that could not be provided to the consumer without further treatment to meet state standards. A viable solution was to construct a groundwater purification complex in the SFB. The purification complex would expedite the groundwater remediation and contaminant mass removal associated with the secondary contamination plume, and enable LADWP to utilize all of its groundwater production wells in the SFB that are threatened or shutdown due to contamination. This purification complex would be a very cost effective way of ensuring LADWP’s future water supply compared to the cost of imported water, recycled water, and desalination. In order to determine the design criteria for the purification complex and to obtain the necessary approval form the California Department of Public Health, LADWP began a six-year, $19 million Groundwater System Improvement Study in the SFB. As part of this study, LADWP would secure a monitoring well-drilling contract by mid 2010 to install approximately forty new monitoring wells in the SFB that would assist with further characterizing the contamination in the SFB. LADWP was also working with the cities of Glendale and Burbank to develop a Memorandum of Understanding (MOU) and a list of projects needed to address various cleanup issues in the SFB. The MOU would allow the cities to more effectively secure federal funding for the needed facilities to clean up the SFB. LADWP was also implementing a cost-effective wellhead treatment to restore groundwater production while centralized treatment facilities were advanced. LADWP was maintaining and operating the initial NHOU-R2 remedy through various funding agreements from USEPA. No other federal funding had been provided to LADWP for addressing the groundwater contamination in the SFB. LADWP believed additional funding would be acquired in the future. Glendale Water and Power stated their supply of water from the SFB has not been affected by the contamination. 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT 107 RECOMMENDATIONS 2.3 LADWP should continue maximum efforts to obtain USEPA funding for the cleanup of the San Fernando Basin Aquifer. 2.4 LADWP should develop a detailed projection of the cost of the cleanup and securing the filtration processes on the wells of the San Fernando Basin Aquifer to obtain the maximum water output according to its legal rights, including the timeframe for completing this process. 2.5 LADWP should have a new review made of the amount of water that can be pumped from the SFB. Due to the future increased demand for water and possible reductions in water sources the SFB may be a major source of potable water. Owens Valley LADWP reported significant expenditures to date for environmental restoration and annual recurring maintenance of Owens River, and Owens and Mono Lakes. LADWP owned and operated the LAA that transported water from the Owens River and Mono and Owens Lake (OROML) to the City of Los Angeles. No major construction had occurred on the aqueduct or attendant facilities in recent years. There were no planned construction projects for this system known at the time of this report. However, LADWP was required by court order to restore habitat in the OROML, estimated to cost approximately $78 million. Water from the OROML is imported by LADWP. Due to the population growth of the city LADWP purchased water rights and started importing water via the Los Angeles Aqueduct from the OROML in 1913. LADWP expanded its presence and drew more water in successive years causing Mono and Owens lakes to dry up. Flow of the Owens River and other streams and rivers was diverted into the LAA and over time severe environmental damage began to occur. The LADWP was sued by the USEPA for dust mitigation. The main damage was that the dry lakebeds became dust hazards. Even before the environmental concerns became an issue, the diversion of water damaged the agricultural industry creating water wars between the LADWP and the residents of the affected areas. In 1989 the California Supreme Court halted all water diversions by LADWP and ordered an extensive ecosystem study to be prepared by the Water Resources Control Board (WCRB). After a series of legal defeats, the LADWP agreed to increase the permanent flows of the creeks and rivers to restore Owens Lake and Mono Lake. The California Supreme Court ruling required the Owens Lake level must reach three feet before LADWP can take 15,000 AFY. Once the level reached thirteen feet, LADWP will be allowed to take 30,000 AFY. This amount was only one-third of the amount of water taken by LADWP in 1988. 108 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT Mono Lake’s recovery plan also followed the same timeline as Owens Lake’s except that it was ordered by the court in response to a lawsuit filed by the Audubon Society which cited the California Fish and Game Code and not any environmental concerns. Weather, over which no one has any control, cooperated with the LADWP for the recovery of the ecosystem by providing a large supply of water, thus advancing the timeline. However, recent years of low rain and snow pack had hampered the supply of water, causing a shortage in the allowable water for the LADWP. Statistics show that in 2008 LADWP received one-half of OROML water it did in 2001. IEA Report In 2002, the Industrial, Economic, and Administration (IEA) prepared a survey of the LADWP that contained numerous important and critical recommendations. The IEA again prepared a survey of LADWP in a report published on February 5, 2009 with follow-up to the 2002 recommendations and significant new recommendations. The significant issues raised from the 2002 review were organizational changes that impact operational continuity, adequate sources of water supply, improved communication with the consumer and required enhancements to infrastructure, and the lack of strategic planning process, Chart 6 delineates the areas covered in the IEA 2002 report that were reviewed in the IEA 2009 report as to the relevancy of the areas covered and the progress by LADWP in responding to those recommendations. 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT 109 Chart 6 IEA Recommendations (Chart made by CGJ based on information from the IEA Report RELEVANCY FOLLOW-UP PROGRESS Review Area and specific recommendations Not Moderately High Some Limited Moderate Significant Strategic Planning Emphasize strategic Planning 1 1 Culture change on strategic planning 1 1 Organizational changes 1 1 Examine Preferred Practices Model 1 1 Integrate Joint System 1 1 Joint System performance measurements 1 1 Total 0 2 4 3 3 0 0 Adequacy of Water Resources: Storage on LA Aquaduct 1 1 Use of MWD analysis of need 1 1 Alternate sources other than MWD 1 1 Legal issue with San Diego on MWD volume 1 1 Limitations of recycled water 1 1 New Quality Standards 1 1 Identify unaccounted water sources 1 1 Upgrade Pumping Capacity 1 1 Total 2 1 5 2 0 2 4 Water Quality Number of samples exceeding secondary samples 1 1 BWG-developed single-index measurement 1 1 Establish formal water Quality Goal 1 1 Benchmark against other cities 1 1 IT for useful data 1 1 Formal goals and objectives for the WSCS 1 1 Solicite expert advice on annual report 1 1 Proactive process for customer info on water quality 1 1 Formal well turn-on and turn-off process 1 1 Four alternates in Finding 12 1 1 Total 2 5 3 6 2 0 2 Installation & Maintenance of Water Infrastructure: Main line replacement project costs collected and analyzed 1 1 IT System fior WETS more user friendly 1 1 Time Schedule for in-house truck line construction 1 1 Establish time and cost performance targets for Trunk Line 1 1 Total 0 0 4 0 0 0 4 Grand Total 4 8 16 11 5 2 10 Chart 6 indicates it was apparent that LADWP had received moderate to highly significant recommendations on the planning process but had only some or limited progress. The CGJ interviewed members of the Board of Water and Power Commissioners (BWPC) and various senior management-level personnel concerning the strategic planning process. It appeared the proper level of recognition in the usefulness of this highly regarded management tool was lacking. The CGJ interviewed the GWP about key issues in the management of its organization and the successes in accomplishing goals and strategies. GWP was extremely proud of its planning process and the output of its strategic plan document. As the CGJ reviewed this document, it was apparent GWP understood how to accomplish the task of completing and utilizing the strategic plan. Its plan included specific targeted tasks, due dates, impact statements, persons responsible and progress measurement criteria. 110 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT The CGJ also noted that the IEA made recommendations concerning the use of recycled water. The CGJ’s investigation indicated recycled water was a relevant issue with insufficient progress. Later in this report, the CGJ addressed the issues and opportunities of using recycled water. As mentioned earlier in the report, Orange County has made significant strides and accomplished marked results in this area. Further, the IEA 2009 report made new recommendations. Some of the key recommendations included: • Support MWD/DWR current efforts on water transfers, and Delta levee improvements and benchmark progress against new reliability goals • Urge and team with MWD to take a leadership role in the development of a new generation of The California Water Plan that provides a blueprint for a state-wide drought shortage sharing policy, and a long-term drought period water transfer options program • Develop a LADWP drought use reduction targets and performance as a percent of standardized state-wide baseline water use • Use their California Conservation Councils’ Best Management Practices as benchmarks against other utilities’ achievements, through investments in standardized reporting • Create a unit cost of water policy goal, together with acceptable rate increases to achieve policy objectives regarding source reliability, water quality and environmental protection • The linkages between strategic objectives and the budget must be clearly stated. Ideally, all major budget decisions should be based on the strategic plan, and all strategic plan elements should have clear support in the budget • Once a comprehensive strategic plan is in place, an annual review of the strategic plan should be completed in time for the annual budget process to incorporate into the budget proposal any changes in the goal objectives • Each business unit should review its operating plan to assure it is aligned with the strategic plan and to make modifications to their operating plan to reflect changes in the operating environment as well as progress made on achieving business unit goals and objectives. The CGJ again recognized that IEA stressed the importance and the objectives of completing a comprehensive strategic plan. IEA also recommended significant improvements to the billing system and information being provided to the consumer. The CGJ has included these recommendations in Section III of this report concerning Smart Bills. RECOMMENDATIONS 2.6 The Mayor of Los Angeles and the City of Los Angeles Board of Water and Power Commissioners should mandate that top management complete a strategic plan with appropriate goals and objectives, target completion 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT 111 dates for all actions, people assigned responsibility for each action and methods to measure the results and completion of all targeted actions. 2.7 The City of Los Angeles Board of Water and Power Commissioners should hold, at a minimum, quarterly reviews of strategic plan implementation and review status and measurements of all action items. 2.8 The City of Los Angeles Board of Water and Power Commissioners should review, at a minimum semi-annually, action taken on Industrial, Economic, and Administration Report recommendations. 2.9 The City of Los Angeles Board of Water and Power Commissioners should approve any changes to the targeted objectives, goals, dates or responsibilities to complete strategic plan issues. 2.10 The City of Los Angeles Board of Water and Power Commissioners should consider using the GWP as an example of how to complete and execute a Strategic Planning Process. 2.11 The City of Los Angeles Board of Water and Power Commissioners should expect that all issues classified as highly relevant in the Industrial, Economic, and Administration Reports have targeted completion dates and identify the specific person responsible for leading the corrective action associated with that recommendation. City of Los Angeles Board of Water and Power Commissioners (BWPC) The five-member BWPC established a policy for LADWP to meet regularly. The BWPC meets on the first and third Tuesdays of each month at 12:30 p.m. The meeting location was: Los Angeles Department of Water and Power Room 1555-H, 15th Floor 111 North Hope Street Los Angeles, CA 90012 Regular meeting agendas were available to the public at least seventy-two hours before the Board met. The BWPC members are appointed by the Mayor and confirmed by the City Council for five-year terms. LADWP’s website contains the official rules and guidelines of the meetings of the BWPC. The standing committees of the BWPC were: Affirmative Action-Outreach Committee Audit Committee Contracts, Land and Legal Committee Finance and Risk Management Committee Safety and Personnel Committee Public Affairs Committee Inyo County/Los Angeles Standing Committee In a BWPC public meeting attended by the CGJ, the President of BWPC said the commissioners were not involved in the resignation of the former General Manager, nor 112 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT in the decision and process of approving a consulting contract with him. The CGJ concurred with the President of BWPC’s recommendation to have any future contracts of employment or consulting by past LADWP employees be approved by the BWPC. During various interviews, the CGJ was informed that a majority of the BWPC’s time was spent on energy issues. This was somewhat understandable since a majority of the infrastructure and income to LADWP relates to energy. Due to publicized water main breaks, concerns had been escalated during the CGJ review; otherwise water had not been a major issue. Due to the importance and the significant of water issues, BWPC might consider dividing the authority and responsibility for energy and water within LADWP. This would be accomplished by establishing two separate entities. The BWPC had the power to authorize any contracts and purchase agreements up to $150,000. Due to budget constraints and increased focus on efficiency, this amount should be reduced to $50,000. The CGJ reviewed the content of BWPC agendas and found there was little formal reporting of LADWP interaction and issues associated with MWD. The CGJ believed that the BWPC should regularly have a formal update from LADWP management on MWD activities and actions. RECOMMENDATIONS 2.12 The Mayor of the City of Los Angeles should amend the rules governing LADWP such that the City of Los Angeles Board of Water and Power Commissioners be involved in the approval process of hiring or terminating key LADWP executives as well as authorizing consulting contracts. 2.13 The Mayor of Los Angeles and the City Council should consider dividing the Operations of the LADWP into an Energy Department and a Water Department. 2.14 The City of Los Angeles Board of Water and Power Commissioners should pass a resolution to have approval authority for contracts and purchase agreements not to exceed $50,000. 2.15 The City of Los Angeles Board of Water and Power Commissioners should adopt as part of its agenda a regularly scheduled reporting procedure from LADWP Management on Municipal water District of Southern California activities and actions. Inspector General There had been numerous audits and reviews of LADWP, by the IEA, Huron Consulting Group, and the Los Angeles Office of the City Controller. These reviews indicated there were a number of issues that required a higher level of oversight by an independent organization. Within LAC and other Los Angeles City organizations, the position of Inspector General existed. Examples were Metropolitan Transportation Authority, Los Angeles County Public Defender’s Office, Los Angeles County Board of 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT 113 Supervisors, Los Angeles County Sheriff’s Department, and Los Angeles Police Department. The Inspector General in these previous organization performed audits and investigated activities with a focus upon the independent review and appraisal of the activities of their appointed agency. This individual was required to make periodic reports to the governing body. This proposed position within LADWP, acting with the BWPC, would review contract assignments, provide independent assessment of water rate increases, review financial justifications for using internal work forces versus outside work forces for sustainability of the infrastructure of water delivery and storage, study and report on emergency management preparedness and security issues, provide information technology reviews and be involved in any other areas requiring an independent review. The CGJ believed the periodic reviews from various agencies was insufficient to support the requirements of the LADWP. The Inspector General would also be the ideal position to use for an independent audit of its follow-up activities. It was recommended to current and the former BWPC that the Inspector General would be a full-time position in the City Controller’s Audit office funded by the LADWP. The BWPC concurred with this recommendation. The person filling this position would be selected and administered by the Los Angeles City Controller.
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  Panel Discussion The City of San Fernando Public Works Water had an ordinance that required 50% of a yard has vegetation. It also used the water from purged fire hydrants to clean the streets, water the planted median strips in the city and other needs for water in the city. There were no city ordinances restricting daily watering. Pasadena Water and Power held workshops to provide tips for consumers on conservation. The city required consumers to water their properties only once per week for ten minutes per zone. The City of Santa Monica Water Department used processed runoff water from the Santa Monica Urban Runoff Facility for city sprinklers and also at the cemetery. There were no city ordinances restricting water use by homeowners and businesses for landscaping. The Long Beach Water Department required that residents only water their plants and lawns three days per week: Mondays, Thursdays, and Saturdays for ten minutes per zone. The CGJ had received a number of methods being utilized to promote water conservation. The following list is not in order of effectiveness or number of water districts that are using them: • Promote public participation in reporting excess water usage such as broken sprinklers, watering on unauthorized days and broken water lines • Increase public awareness programs for water conservative appliances • Educate consumers on water availability and supply • Promote water rate structures to encourage heavy users to reduce water usage • Utility employees provide water conservation analysis for commercial and high usage consumers • Water districts promote programs to provide smart meters so the consumer can understand the usage in their household • Water districts provide programs to redirect rain spout water for external usage, including the use of rain barrels 102 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT • Water districts provide increased usage of treated wastewater including educating the user of the safety of using treated wastewater • Use water tank trucks to capture the water from water main purging operations and using this water for various civic water needs • Convert lawns to water conserving plants and flora • Provide intermediate meters that measure inside versus outside consumption. This allows the consumer to determine where the water usage is going. It might be possible for the utility company to distinguish rates for life support versus outside water usage • Promote the use of purple pipes in homes to capture the water from dishwashers, showers and sinks for outside lawn use • Promote the use of rain barrels to capture water runoff • Establish an ordinance for limited watering days and duration of outside landscaping • Establish a comprehensive list of water sensitive plants and ground cover that can be purchased for outside landscaping • Hold quarterly meetings to discuss successful water conservation methods for implementation within each district SECTION II LADWP, THE CITY OF LOS ANGELES GENERAL DISCUSSION Mayor’s Plan In May 2008, Mayor Antonio Villaraigosa coordinated with the LADWP a report titled, Securing L.A.’s Water Supply. The plan was an attempt to respond to water shortages in 2007 and to initiate a proposal to rethink existing and future water supplies. The plan would respond to a demand for an additional 100 thousand AF of water per year by
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  Establish a Third Tier rate based on the marginal cost of recycled water to be imposed for very high usage, consistent with the original concept for LADWP’s water rate structure to provide a forward-looking price signal for the cost of new water supplies.
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  Realign household size adjustments at the First Tier rate using the current best management practices and technologies for indoor water use.
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  Utilize application of climate based conservation data to make adjustments in current First Tier usage blocks.
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  Increase low income and lifeline subsidies.
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  Update General Provision J of the Water Rates Ordinance, Adjustment Factor Limitations, based on the current projections for the adjustment factor components.
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  Modify Water Shortage Year Rates based on experience following initial implementation of these rates in 2009 and incorporate the rate restructuring. Increase the current minimum period for review by the City Council and the Mayor following approval by the Board to implement Shortage Year Rates from fifteen days to thirty days.
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  Eliminate Board approval of the water recycle contract for each LADWP customer and establish the commodity charge as 80% of the total First Tier billing rate for potable water (including adjustments).
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  Set lot size or temperature zone adjustments.
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  Revise the Water Quality Adjustment cap requirements.
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  Revise the Water Procurement Adjustment factor to encourage water conservation and fully recognize the results of demand-side management programs. LADWP water rates were based on establishing a water budget for a reasonable amount of water for each consumer. Consumption within that amount was then charged at First Tier rates. Consumption above the budget was charged at the higher Second Tier rate. 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT 115 The cost to validate the methodologies and analyses that their rate increases will be based on, included up to $150,000 in consulting services. In addition to LADWP staff expense, it was proposed that a resolution to the BWPC for the adoption of the rate increase be completed by January 2010. The process from proposal to approval was nine months. Water rate increases were approved by Los Angeles City Council and were passed on to the consumers within the city. These rate increases were predicated on water use and conservation efforts. Los Angeles had fixed costs for the delivery of water to the LADWP consumer. Additionally, many cities such as Pasadena, Glendale, Santa Monica, and Long Beach had tiered water rates based on the consumer’s use of water over and above set limits. In early 2010 San Fernando did not have a tiered rate system in place for water usage but was considering this option. There was general public agreement for the addition of a ratepayer advocate (RPA) responsible to review any rate increases. The RPA should be acceptable to all stakeholders. The RPA must function outside of the LADWP organization. The RPA must be assured of full access to any and all data and information from the LADWP that would be needed to accomplish its goals. The CGJ recommends that funding of the RPA, its staff, and office come from the LADWP. These are funds that are paid by all ratepayers. The selection and appointment process for creating the RPA must be accomplished with the utmost care to assure every interested party in the city of the independence and integrity of the RPA's organization and recommendations. Requirements for the RPA organization would include: • A staff of competent, qualified analysts and experts in the electric and water utility industries who will evaluate all significant proposals and monitor and advise management, when warranted, of any proposed or actual actions or omissions that may adversely affect the LADWP's ratepayers • The ability to monitor and provide transparency to ratepayers of all major projects and project proposals of management • The responsibility to monitor and publicize where necessary efforts by the LADWP to increase rates • The monitoring and publicizing of the status of the infrastructure and technology necessary to run LADWP effectively and efficiently • The review and analysis on a timely and continuous basis of the operations, finances, and management of the LADWP • The Rate Payers Advocate shall be beholden only to LADWP Rate Payers, although it may advise the City Council, the Mayor, and other interested parties • A place at the table at meetings of the Board of Water and Power Commissioners and at the City Council when LADWP affairs are being discussed • Complete independence from the governments of the City, County, and State and any of their suppliers or unions • The necessary education, experience and skills to perform its duties, including an understanding of the operations and finances of public utilities 116 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT RECOMMENDATIONS 2.18 The City of Los Angeles Board of Water and Power Commissioners should require a detailed analysis of the basis of any rate increase and this analysis should be included in that portion of the rate increase. 2.19 The City of Los Angeles Board of Water and Power Commissioners should provide the basis and details for any rate increases to the public with an appropriate period allowing for public response. 2.20 The City of Los Angeles Board of Water and Power Commissioners should provide the basis and details of any significant changes to the billing process with an appropriate period allowing for public response. 2.21 LADWP should establish a Rate Payer Advocate organization with the duties and structure as defined above. Non-Revenue Water (NRW) NRW was defined as water that has been produced and is lost before it reached the customer. Losses could be real losses through leaks, sometimes also referred to as physical losses or apparent losses (for example through theft or metering inaccuracies). High levels of NRW are detrimental to the financial viability of water utilities, as well to the quality of water itself. NRW is typically measured as the volume of water lost as a share of net water produced. It is sometimes also expressed as the volume of water lost per kilometer of water distribution network per day There are other sources of NRW, the major sources were leaks, evaporation, fire hydrants, inaccurate meters, and unauthorized use. The California Department of Water Resources distinguished between authorized unmetered uses and water losses. Authorized unmetered uses could have included water used for beneficial purposes, such as fire fighting and main flushing. Most definitions identified some of the potential sources of NRW, including water for fire fighting and flushing, leaks and breaks, illegal connections, faulty meters, and other sources. A report entitled Water Conservation a Local and Regional Perspective was submitted to the World Water Forum, by the LADWP and the MWD of Southern California, dated March 2006 with the following statement: “In terms of total actual use within the City, single-family and multi-family dwellings constitute the greatest demands (60% of the total demand). Commercial water use accounts for over 20%, governmental use about 7 percent, industrial use about 4%, and non-revenue water system loss accounts for about 8% of the total water demand. “Non-revenue water is lost in the process of transporting and delivering water to customers. LADWP’s efforts to minimize water loss through an aggressive infrastructure rehabilitation and maintenance program include pipeline rehabilitation, leak detection and repair, meter replacement, and cement lining programs.” 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT 117 It was also reported on February 2007 in a report titled, Water Loss Control in North America: More Cost Effective Than Customer Side Conservation- Why Wouldn’t You Do It? “LADWP has a relatively low level of real water losses. However, economic analyses have shown that a more aggressive active leak detection and repair policy is economically feasible. Since the part of the project has not started yet it was necessary to estimate the cost for the leak detection and repair program based on average industry cost data. The average cost for the entire program including the cost for a detailed water audit that forms the bases for the intervention program and the cost to detect and repair the leaks was calculated to be $347 per acre foot of water saved.” The CGJ was informed by LADWP that in 2009 the NRW was approximately 4.5%. This would be a significant change from what was reported in the March 2006 report, and was consistent with the February 2007 report that was prepared in conjunction with the 2007 CA/NV AWWA (American Water Works Association) Spring Conference held in Las Vegas. The CGJ reviewed literature on the percent of NRW throughout the United States. The rate went as high as 40% and as low as 2%. The CGJ commended LADWP for maintaining such a low percent on NRW. RECOMMENDATION 2.22 That LADWP initiate an aggressive active leak detection and repair program to reduce the negative financial impact to LADWP customers. Water Line Breaks The CGJ repeatedly learned from news sources about the number and severity of water line breaks within the LADWP infrastructure. The BWPC said the number of breaks that occurred during 2009 was within the range of the number of breaks in former years. The LADWP provided information on its website concerning the water breaks. This information included that due to colder water entering the distribution system from the Eastern Sierra Nevada during the winter months, the LADWP water system typically experienced an increase in water main breaks. The colder water caused the pipes to shrink slightly, (known as thermal contraction), which could cause pipes to break. Winter leaks occurred most frequently in the early morning hours (3 a.m.-5 a.m.) when pressure was highest because of minimal use and the temperature was the coldest. Historically, LADWP had seen a six-year average of twenty-five major breaks for the month of January, compared to an average of fifteen for November. Recently, LADWP experienced, on average, approximately four breaks a day, which was an extraordinarily small number given the size and complexity of its water system. The LADWP system averages twenty leaks and breaks per 100 miles of pipe a year, 21% below the national average of twenty-five breaks per 100 miles of distribution pipe. Most breaks or leaks require small spot repairs, not full replacements. 118 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT LADWP completed a cement-mortar lining program in 2007 to extend the life of the existing pipes by fifty years. This aggressive program successfully lined a total of 1,970 miles of pipes, accounting for more than one-quarter of the expansive system. In 2007 LADWP began a formal Water Main Replacement Program to replace aging pipes. Not all of the pipes within more than 7,000 miles of pipes in this system needed to be replaced. The pipe replacement program is ongoing and aimed at replacing aged pipes to uphold the strength and reliability of this system. Fourteen full-time crews are dedicated to mainline pipe replacement. In the past two years, LADWP had replaced approximately thirty miles of mainline pipe and has set a goal of replacing approximately twenty miles in the coming year, a significant increase over the prior two-year rate. These two programs are intended to minimize main leaks, service interruptions to the customers, and potential property damage. Over the long-term, these programs will reduce water main maintenance costs, improve water quality, reduce water loss due to leakage, and improve water flow for fire emergencies. The above information supported that LADWP was doing an effective job in pipe replacement considering the size and complexity of the system. However, current and former personnel associated with the LADWP indicated that a considerable number of outside bids for the servicing of the infrastructure were not considered. It was reported these bids were approximately 60% lower than internal costs and would be completed more time efficiently. RECOMMENDATION 2.23 The City of Los Angeles Board of Water and Power Commissioners should establish a process for ensuring consideration of acquiring bids from outside firms for replacement and repair of water infrastructure. 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT 119 Water Supply Projections Chart 7 – Water Demand and Supply was based on the 2005 Urban Water Management Plan and the 2008 Water Supply Action Plan. 2005-2030 POPULATION, WATER DEMAND PROJECTION, & SUPPLY SOURCES Data 2005 Urban Water Management Plan 2008 Water Supply Purchased Source Action Plan Water Demand Recycled Additional Calendar Projection LAA Wells Water Conservation MWD Year Population (AFY) (AFY) (AFY) (AFY) (AFY) (AFY) 2005 Actual 3 ,983,875 608,993 368,839 56,547 1,401 3 ,140 185,346 2010 4 ,099,389 678,000 276,000 106,000 8,750 3 ,770 283,480 2015 4 ,157,727 700,000 276,000 106,000 22,480 1 2,746 282,774 2020 4 ,215,380 726,000 276,000 106,000 50,000 2 2,010 271,990 2025 4 ,270,520 750,000 276,000 106,000 50,000 3 6,554 281,446 2030 4 ,323,307 776,000 276,000 106,000 50,000 4 8,170 295,830 AFY - Acre-Feet per Year LAA - Los Angeles Aqueduct MWD - Metropolitan Water District of Southern California LADWP indicated that in 2009 MWD would supply 70% of the water or approximately 470 thousand AF. This does not agree with the above chart LADWP provided. The amount of water from the wells was also questionable as most of the well water comes from SFB. Unless significant efforts are made on the SFB cleanup, the current supply of 50,000 AF per year will be reduced in the next three to five years. Another aspect of this projection was the total Demand Projection divided by the population expressed in gallons per day per person (GPD). In 2005 this calculation was to be 148 GPD. In 2010 the calculation was 148 GPD and by 2030 the calculation would increase to 160 GPD. The 2030 projection represents a 17% increase over 2005 and a 9% increase over 2010. This is contrary to the established goals of conservation and increasing the amount of recycled water being captured. RECOMMENDATIONS 2.24 LADWP should provide realistic projections of water demand and water supply. 2.25 LADWP should reconcile the projections with expected conservation and recycled water expectations. 2.26 LADWP should reconcile the expected demand from Metropolitan Water District (of Southern California) and coordinate this expectation with Metropolitan Water District (of Southern California). 120 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT Waste Water Conversion The CGJ studied a number of water districts and agencies, usually in concert with sanitation districts that produced and sold reclaimed/recycled water. The CGJ was not provided with a definitive estimate of the cost of making wastewater potable. The answer most commonly received was It is expensive; however, it is less than the cost of desalination. The CGJ found no facilities operating in or near LAC that produce direct wastewater to potable water. The Orange County Water District (OCWD) produces indirect potable water. This reclaimed/recycled water was pumped to settling basins or ponds, where it percolated into deep aquifers and eventually mixed with the drinking water supply. OCWD published a dollar figure of $550 per AF for their reclaimed potable water. This cost seemed favorable when compared with imported water from Northern California or the Colorado River. The Los Angeles Economic Development Corporation (LAEDC) report titled Where Will We Get the Water estimates the OCWD reclaimed potable water costs $1,000 per AF. The $1,000 per AF estimated by LAEDC was an all in figure that included capital expenses, operating costs, pumping, transportation and treatment after the water was pumped to the surface. The LAEDC estimated cost figure did not compare favorably with imported water from Northern California or the Colorado River. In the future it may compare favorably depending upon the anticipated rate increase for imported water. MWD rates for water as of early 2010 were approaching $700 per AF. This rate will continue to increase. The CGJ found that the LADWP was considering pumping reclaimed/recycled water from the Tillman and Los Angeles-Glendale wastewater sanitation plants to the Hansen Spreading Grounds. This would be comparable to the OCWD process. The CGJ was unable to obtain a cost estimate from LADWP for the pumping to the Hansen Spreading Grounds. Through interviews with various water officials, the CGJ learned that new technology was being developed to reduce the cost of treating reclaimed/recycled water to make it potable. The CGJ was also aware the cost was not the only issue. There was the general public perception of the toilet to tap yuck factor which acted as a major drawback to the conversion process. The CGJ noted that the Hyperion Treatment Plant pumped approximately 360 thousand AF of safely-treated water per year directly into the ocean (capacity of this facility is 2,500 AF per day). This represented more than 50% of LADWP projected water requirements per year through 2020. There was no published information regarding converting this water to potable water. RECOMMENDATIONS 2.27 LADWP should complete a comprehensive plan to study the conversion of wastewater to potable water. This plan should include an analysis of conversion costs compared with projected purchased pricing. This 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT 121 analysis should include alternative uses of the reclaimed water other than just for potable water usage. 2.28 In order to reduce the public perception of using wastewater, LADWP should publish information to the public concerning the methods other water districts are using to convert wastewater to potable water Supply Strategies Chart 8, below was provided by LAEDC concerning Southern California water supply strategies. The most favorable strategy for acquiring additional water supply is Urban Water Conservation followed by Stormwater Capture. The benefits of conservation were: • An impact equivalent to adding about 25% to regional supply • One of the most reliable strategies • One of the least risky • The most environmentally friendly • One of the least expensive strategies RECOMMENDATION 2.29 The CGJ recommends that LADWP incorporate the findings of Los Angeles Economic Development Corporation into their proposed Strategic Planning Process for objectives and targets. 122 2009-2010 LOS ANGELES COUNTY CIVIL GRAND JURY FINAL REPORT SECTION III SMART BILLS GENERAL DISCUSSION Water Bill Comparisons The CGJ investigated several water bills within LAC and there was one fact in common, i.e., those who use less pay more per gallon than those who use more. This, in part, is due to the fact that fixed rate portions of the bills and the tiered or block rates are not structured at a point to effectively reward those who conserve versus those who exceed their allowances. There was also a wide diversity in the types and complexity of the bills. The CCG examined the utility bills from several water retailers in LAC. The results were: