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Extracted from Consolidated Report

This investigation was originally published as part of a larger consolidated report containing multiple investigations. View the consolidated PDF for the complete document.

El Dorado County Grand Jury • 2000-2001

El Dorado County Water Agency

12 pages
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Findings 16 findings

F1 Page 182
The El Dorado County Water Agency was created and operates pursuant to Chapter 2139 of the 1959 Statutes of California, as amended, known as the El Dorado County Water Agency Act ("Act"). The Agency's governing authority appears at Chapter 96 of the Appendix to the California Water Code. All further section references in these findings are to provisions contained in the Appendices to the Water Code. 1 83 Response to F1: The respondent agrees with the finding.
F2 Page 183
The Agency was created because the California Legislature found, in 1959, that "water problems in the county require county-wide water conservation, flood control and development of water resources," and that the then existing "county water districts, municipalities, and water conservation districts" were "unable alone to economically develop an adequate water supply and control the floods of the county." The Legislature further found that it was "necessary to have a political entity coextensive with the geographical limits of the entire county," that conditions within the County were "peculiar to it," and that the Act was "necessary for the conservation, development, control and use of said water for the public good and for the protection of life and property" within the County. (Section 96-103.) Response to F2: The respondent agrees with the finding.
F3 Page 183
The territorial jurisdiction of the Agency consists of "all the territory lying within the exterior boundaries of the County of El Dorado." (Section 96-2.) Response to F3: The respondent agrees with the finding.
F4 Page 183
The Agency has the authority to acquire real and personal property, both by exercise of the power of eminent domain and by grant, purchase, gift, devise and lease. (Sections 96-8 and 96-9.) The Agency has exercised this power only sparingly, and in those instances, in which it has exercised the power, it has subsequently transferred ownership of the property thus acquired to water purveyors within the County rather than retaining it. Response to F4: The respondent agrees with the finding. All acquisitions of property to date have been on a willing-seller basis.
F5 Page 183
The Agency has the power, except as otherwise expressly limited by the Act, "to do any and every lawful act necessary in order that sufficient water may be available for any present or future beneficial use or uses of the lands or inhabitants" within the Agency's territory, "including, but not limited to, irrigation, domestic, fire protection, municipal, commercial, industrial, recreational, and all other beneficial uses and purposes." (Section 96-11.) The Agency has not exercised this power aggressively. Response to F5: The respondent disagrees partially with the finding. At times during its history, the Agency has aggressively exercised these enumerated powers; however, Board policy and direction regarding the Agency’s activities and overall role has shifted and been inconsistent. The Agency has been effective with some water supply augmentation efforts 1 84 and would like to draw the Grand Jury’s attention to its current efforts to acquire additional water supplies to meet projected needs. First is the water right application for 17,000 acre-feet of water that resulted in the State Water Resources Control Board (SWRCB) Decision 1635, which is currently under reconsideration. A draft decision on reconsideration has recently been issued, the SWRCB has held a workshop on the draft decision, and a final decision is expected by the end of this year, possibly in August. This water supply project was researched and initiated by the Water Agency and joined in by the El Dorado Irrigation District, the beneficiary of the granting of the rights. The second effort is the 1990 Congressional directive (P.L. 101-514) to the Bureau of Reclamation to enter into a contract with the Agency for up 15,000 acre-feet of water from the Central Valley Project at Folsom Reservoir. This legislation was the direct result of Agency action. Currently the Agency, with the technical and financial participation of the El Dorado Irrigation District and the Georgetown Divide Public Utility District, is preparing the necessary environmental impact document to disclose the impacts of this action in conformance with both the California Environmental Quality Act and the federal National Environmental Policy Act. The completion of these studies will closely follow the adoption of the County General Plan, projected for early 2003. Countywide, these two additional water sources are the only major supplies being pursued at present by any agency. In 1996, these additional water supplies were projected to meet the future water needs of the west slope of the County through approximately the year 2025. The adoption of a new general plan will require a new study to determine the adequacy of this additional water supply. However, even after the addition of these new water supplies, projects to improve drought protection and water delivery reliability will continue as an unmet need to be further addressed. In an effort to secure additional water for future needs though the exercise of the powers identified in this finding, the Agency joined with the El Dorado Irrigation District on October 5, 1982, to form the South Fork of the American River Project Authority (Authority) as a joint powers authority. The Authority proposed and partially funded studies leading to the proposal for the construction of the South Fork of the American River Project (SOFAR). The Authority received voter approval to issue bonds to construct the project. However, due to continued environmental community opposition and high interest rates in the bond market, the bonds were not saleable and the effort to construct the project collapsed in 1986. It was following this ill-fated effort that the Agency was staffed with full time personnel and the action to augment water supplies that resulted in the two projects discussed above was initiated.
F6 Page 184
The Agency presently has the following statutory powers, among others: 1 85 a. “To construct, operate and maintain works to develop hydroelectric energy as a means of assisting in financing the construction, operation and maintenance of its projects for the control, conservation, diversion and transmission of water," and "to enter into contracts for the sale of such energy … at wholesale rates to any public agency or private entity engaged in the sale or use of electric energy." (Section 96-12.) "Incidental to the construction and operation of the works of the agency, the agency shall have the power to contract for the sale of the right to use falling water for power purposes with any public or private entity." (Section 96-22.); b. “To control the flood and storm waters of the agency" and "to conserve such waters for beneficial and useful purposes" (Section 96-13.); c. “To store water in surface or underground reservoirs;" "to conserve and reclaim water;" "to appropriate and acquire water and water rights, and import water into the Agency;" to engage in any "action or proceeding involving or affecting the ownership or use of waters and water rights" in which the Agency has an interest; "to prevent interference with or diminution of, or to declare, rights in the natural flow of any stream or surface or subterranean supply of waters;" "to prevent unlawful exportation of water;" and "to prevent contamination [and] pollution" of waters (Section 96-14.); d. “To construct, purchase, lease, or otherwise acquire works and … water and water rights, useful or necessary to make use of water for any purposes authorized" by the Act (Section 96-15), including but not limited to "pipes, pipelines, flumes, [and] tunnels and other conduits, including facilities for the transmission of electric energy to the works of the agency" (Section 96-18.); e. “To operate, repair, improve, maintain, renew, replace and extend all works and property of the agency" (Section 96-16.); f. To "enter into contracts with any member unit" of the Agency as defined in the Act (Section 96-24.); g. “To cooperate and contract with the United States … for the purposes of construction of works, … or for the acquisition, purchase, extension, operation and maintenance of such works, whether for irrigation, drainage, or flood control, … or for a water supply for any purposes" (Section 96-30.); and h. To hold legal title to property (Section 96-42.). 1 86 Response to F6: The respondent agrees with the finding. The response is subject to one important clarification. The Agency’s primary funding source is an ad valorem property tax levied on all real property within the Agency. (Section 96-47.) The proceeds of that tax may be used for all lawful expenditures of the Agency, “except the cost of constructing any works.” (Ibid.) The term “works” is defined very broadly to include dams and dam sites, reservoirs and reservoir sites, and all conduits and other facilities useful in the control, conservation, diversion and transmission of water, power generation and transmission facilities, and all land, property, franchises, easements, rights of way and privileges necessary or useful to operate or maintain any of the foregoing.” (Section 96-3, subd. (e).) Most of the powers enumerated by the Grand Jury, therefore, involve the construction of works. As a result, before it could exercise those powers, the Agency would first have to define an environmentally acceptable and financially feasible project that will generate adequate revenue to retire the debt incurred in its development.
F7 Page 186
The Agency has failed, either totally or at least substantially, to exercise the powers set forth in subsections "a" through "e" of the preceding Finding. It has, instead, deferred to water purveyors within the County for primary activity in those areas. Response to F7: The respondent disagrees wholly with the finding. The Agency has neither “failed” to exercise the enumerated powers, nor has it typically “deferred” to water purveyors for primary activity in those areas. See responses to Findings F5 and F6 above, for further explanation.
F8 Page 186
The Agency has the duty, among others, "to equitably apportion the benefits of the agency to the lands within the [various] zones" located within the Agency. (Section 96-46(a).). The Agency has delegated the majority portion of that authority to EID. EID, however, may in the future have significant potential disputes with the Georgetown-Divide Public Utilities District concerning the diversion and allocation of water from the South Fork of the American River at Folsom Lake. Those potential disputes may ultimately result in a conflict of interest on the part of EID, between its inter-district water allocation role and its role as a water supplier to its own customers. Response to F8: The respondent disagrees wholly with the finding. The respondent disagrees wholly with the finding. The statute authorizes, but does not require, the Agency Board to designate zones of benefit within the Agency. If a zone is designated, special taxes may be levied and/or bonds issued to finance the construction of works within such zones. This statute was added to the Agency’s Act in 1971 and has never been utilized. There has been no delegation of the authority granted by the statute, to EID or any other entity. EID has no inter-district water allocation role. Public Law 101-514 directs the United 1 87 States Bureau of Reclamation to contract with the Agency for additional water supplies from Folsom Lake. As the prime contractor, the Agency retains the authority to determine how to allocate those new supplies between EID and Georgetown Divide Public Utility District.
F9 Page 187
At the present time, the Board of Supervisors of the County ("BOS") is, ex officio, the Board of Directors of the Agency ("Board"). Each member of the BOS serves as a member of the Board without additional compensation, except for expense reimbursement. (Section 96-33.) This Board composition is counter-productive to the long-term interests of water and power development within the County, because the normal planning focus of BOS members is relatively short-term and is diluted by competing planning interests unrelated to the development of water and power, whereas the appropriate and required planning focus of Agency Board members must necessarily be long-term in nature, i.e., 20 to 40 years or more in the future. Response to F9: The respondent agrees with the finding.
F10 Page 187
By contrast, and by way of example, the composition of the Board of Directors of the Placer County Water Agency, which is authorized in Section 81-7 et seq. of the Appendix to the California Water Code, is significantly more flexible, in that the original directors, members of the Board of Supervisors ex officio, have been replaced by directors who are elected from the five supervisorial districts within Placer County. (See Section 81-7.1.) The Placer County Water Agency has the reputation of being an efficiently organized, managed and operating entity. Other water and/or power suppliers which have similar reputations for efficiency include the Turlock Irrigation District, the Modesto Irrigation District, the Nevada Irrigation District, the Northern California Power Agency, the M-S-R Power Authority, and the Sacramento Municipal Utility District. Response to F10: The respondent disagrees partially with the finding. All named entities operate water and/or power projects, which the Agency does not. All, except the Northern California Power Authority and the M-S-R Power Authority, have legal authority to sell water to retail customers, which the Agency does not. Differences such as these affect the operations of these agencies much more significantly than the makeup of their Boards of Directors. Also, the M-S-R Power Authority is a newly formed entity that, in the respondent’s opinion, has not yet developed any reputation, favorable or unfavorable. 1 88
F11 Page 188
Senator Rico Oller has introduced proposed legislation, SB 428, which would amend Section 96-33. In its form as of April 11, 2001, SB 428 would revise the composition of the Board of Directors of the Agency by providing for a five- member Board, three of whom would be members of the Board of Supervisors, with specific consideration being given to the Supervisor representing a district that includes the largest area in the county not served by a water district. The other two Agency directors would be appointed by the water districts within the County, with one director being from either the South Lake Tahoe Public Utility District or the Tahoe City Public Utility District, and the other being from either EID, the Grizzly Flats Community Services District or the Georgetown Divide Public Utility District. EID, however, would have a representative filling this position on at least an every other term basis. The BOS has adopted a resolution supporting this proposed legislation. Response to F11: The respondent agrees with the finding. The response is subject to the following clarifications. In addition to this Board, the Agency Board, the Boards of all county water purveyors, the County Chamber of Commerce, and the Taxpayers Association have all adopted letters or resolutions of support. SB 428 has passed out of the legislature, been signed by the Governor, and will come into effect January 1, 2002.
F12 Page 188
The Grand Jury agrees in concept, and without taking a specific position on the details of Senator Oller's proposed legislation, with the principles that water purveyors, and unaffiliated members of the public to the extent reasonably possible, within the County should be represented on the Agency's Board of Directors. Response to F12: The respondent agrees with the finding. Note that SB428, as approved, does not provide for direct representation by a public member on the Agency Board of Directors.
F13 Page 188
The Agency does not presently have a current county-wide water plan. A draft plan was prepared in 1993, but that plan was never completed. Projections of demand have significantly changed since 1993. At the Agency's request, the BOS has authorized a request for proposals for the preparation of an updated county water plan, showing options for actions to meet projected demand through 2020, and projections of those estimates to 2050, but also requiring identification and consideration of environmental concerns along with economic and technical issues. The Grand Jury supports the preparation, and ultimate adoption, of such a Plan. Such a Plan need not necessarily envision any particular degree or extent of population growth within the County, if increases in water and/or power usage can reasonably be anticipated to occur for reasons other than growth. Response to F13: The respondent agrees with the finding. 1 89
F14 Page 189
The Court of Appeal, Third Appellate District, State of California, in County of Amador v. El Dorado County Water Agency, 76 Cal.App.4th 931, has held that the adoption of environmental documents pertaining to specific water development plans are impermissible unless and until a countywide general plan has been adopted. Accordingly, the absence of a formally adopted countywide general plan inhibits action on any county water plan, which may be appropriate for the benefit of the residents of the County. In the interim, water resources to which El Dorado County has, or may have, potential development rights may be lost to potential water users downstream from the County, or in the San Joaquin Valley, in Southern California, and elsewhere. For that reason, among others, it is necessary that a countywide general plan be adopted and put into place at the earliest possible opportunity. Response to F14: The respondent agrees with the finding. The response is subject to two clarifications. First, the appellate case cited does not prohibit the certification of an EIR in connection with new water supplies, even absent an adopted general plan, if the supplies are necessary for development that is already finally approved but as yet unbuilt. The primary example of such development is the development allowed by the Writ of Mandate issued in the County’s General Plan litigation. Second, the Agency agrees that the County should adopt a new and valid General Plan as soon as it can, but we recognize that water to which County entities have or may seek rights can be lost at any time for a variety of reasons that are not related to the General Plan. Although these rights or potential rights may be lost to other water users, they are more likely to be dedicated to environmental purposes.
F15 Page 189
The County's present water difficulties have resulted from a history of the BOS, sitting as the Agency's Board of Directors, having played politics with the issue, sacrificing water development needs to other, more immediate and politically beneficial, purposes. Plans for water development and power generation have been created and then, for various reasons, have failed to be implemented. As a result, significant opportunities for such development and generation have been lost and, with changing conditions, cannot now be reclaimed. Action is necessary at this time to ensure that similar opportunities, which may presently exist, are not lost by reason of inertia, conflict or other causes of delay. Response to F15: The respondent agrees with the finding. 1 90
F16 Page 190
In summary, the Grand Jury has concluded that the El Dorado County Water Agency, which has existing statutory authority to play a major role in the acquisition and development of water and power resources within the County, has not been exercising that authority to its maximum efficiency, but instead has been delegating that authority to individual water purveyors whose interests may (or may not) conflict. Response to F16: The respondent disagrees partially with the finding. As explained in the response to finding F8, there has been no delegation of Agency authority to other entities. The Agency’s frequent failure to exercise its authority, however, has sometimes by default left individual water purveyors to fend for themselves in the acquisition, development, and defense of water and power resources within the County.

Recommendations 7