Feasibility Study Project Description, Objectives and Costs River Partners seeks funding for the “San Joaquin River National Wildlife Refuge Conjunctive Use Project” (“Project”) which will acquire land, retire agricultural operations, and perform bare essential modifications to acquired properties located between river miles 82 and 101 on the San Joaquin River. River Partners will be purchasing four properties, as follows: Property 1

Located at river mile 85.5-88L on the San Joaquin River, this property maintains a riparian right that historically draws up to 5000 acre-feet annually to irrigate row crops onsite. This property is surrounded on three sides by water, both from the San Joaquin River and historic Laird Slough and does not include any federal or state levees. As such, this property frequently floods and would provide up to 480 acres of floodplain habitat benefiting multiple species. The current owner maintains an operable dairy that is leased to a third party. Onsite, the owner farms alfalfa, wheat, and corn for silage as well as tomatoes. The property includes residential structures and dairy infrastructure. River Partners anticipates retiring the dairy operation and removing associated structures. All fields will be converted to high-quality floodplain habitat consistent with needs for anadromous salmonids.

Property 2

Located at river mile 3.8-4.8L on the Tuolumne River, Property 2 includes 168.3 acres of historic floodplain. This property is currently farmed in nut crops, blueberries, and cherries and suffered flood damage in the 2017 season. The property is located adjacent to River Partners’ 2,100-acre Dos Rios Ranch and if acquired would be restored and managed in a manner consistent with the ongoing restoration at Dos Rios (see attached Dos Rios Ranch Restoration Plan).

Property 3

Property 3 is located at river mile 99-101.5R on the San Joaquin River. The current landowner maintains a dairy operation onsite, housing 575 head of cows. In addition, the landowner farms the site in alfalfa for silage. The property includes 2.5 miles of degraded riparian habitat that will contribute to anadromous salmonid passage once enhanced to reflect historic conditions. In addition, the property includes farmer berms, that once removed will allow San Joaquin River flows onto the property, restoring groundwater recharge potential and riparian ecosystem function.

Property 4

Property 4 is located immediately adjacent to Property 3’s southern border. Together, the two properties will total over 400 acres of contiguous floodplain habitat within the San Joaquin River National Wildlife Refuge acquisition boundary. Property 4 is located at river mile 97.5-99R on the San Joaquin River and currently includes a small goat farming operation and various row crops. River Partners would remove all farmer berms immediately from this property, allowing the fields to inundate to support groundwater recharge and riparian ecosystem function.

River Partners’ stated objectives in completing this project are trifold: (1) improve rearing and migration habitat for spring-run Chinook salmon, (2) improve habitat for endangered riparian brush rabbit, and (3) improve water quality and quantity in the San Joaquin River. Project Costs are limited to land purchases, due diligence and initial scoping, as follows:

Project Benefits

River Partners’ stated objectives in completing this project are trifold: (1) improve rearing and migration habitat for spring-run Chinook salmon, (2) improve habitat for endangered riparian brush rabbit, and (3) improve water quality and quantity in the San Joaquin River.

Each is discussed below.

Benefit: Anadromous Fish.

The Project is feasible because it builds upon two decades of River Partners substantial work in river restoration science, land management, monitoring and innovation in partnership with many agencies, institutions, and organizations that have long engaged in the benefits claimed (quantified and not). The proposed project approach is appropriate as it utilizes previously developed scientific information and applies it to physical applications. The timeframe for the project is appropriate for the level of effort and has a high probability of completion.

River Partners has been a pioneer in ecological restoration of California’s rivers and floodplains since 1998 and one of the few organizations that has actually designed, permitted, and restored habitat in a regulatory floodway. We partner closely with organizations such as American Rivers, which has worked tirelessly over the last year to help the California Department of Fish and Wildlife (CDF&W) advance voluntary agreements with water users in the Central Valley to restore salmon and other native species. Another close partner, the UC Davis Center for Watershed Sciences, is California's leading academic institute in water management. As an interdisciplinary research unit of the John Muir Institute of the Environment, the Center combines the talents of biologists, geologists, engineers, economists, legal scholars and others to help understand and solve California's complex water problems. Their research is nonpartisan and funded from a diverse portfolio of sources, primarily foundations, public agencies and

Cost Item Total Cost Property A Property B Property C Property DGrant Administration $ 100,000 25,000$ 25,000$ 25,000$ 25,000$ Project Management RP $ 52,000 13,000$ 13,000$ 13,000$ 13,000$ Appraisal (1 original & 1 update) $ 60,000 15,000$ 15,000$ 15,000$ 15,000$ Phase 1 & 2 Assessments $ 30,000 7,500$ 7,500$ 7,500$ 7,500$ Land Management Plan $ 34,000 8,500$ 8,500$ 8,500$ 8,500$ NEPA/CEQA Environmental Documentation $ 20,000 5,000$ 5,000$ 5,000$ 5,000$ Pre-acquisition direct staff time, supplies, professional fees $ 74,000 18,500$ 18,500$ 18,500$ 18,500$ Escrow Fees, Title Insurance, Closing Costs $ 28,000 7,000$ 7,000$ 7,000$ 7,000$ Required Signage $ 8,000 2,000$ 2,000$ 2,000$ 2,000$ Hydraulic Analysis & Water Use Assessment* $ 180,000 45,000$ 45,000$ 45,000$ 45,000$ Conceptual Restoration Evaluation & Community Outreach $ 190,000 $ 47,500 $ 47,500 $ 47,500 $ 47,500

Estimated Non-fee acquisition, due diligence and Preliminary Costs. $ 776,000 $ 194,000 $ 194,000 $ 194,000 $ 194,000 Fee Title Acquisition $ 21,409,000 $ 5,000,000 8,975,000$ 2,934,000$ 4,500,000$ Total Estimated Costs 22,961,000$ 5,388,000$ 9,363,000$ 3,322,000$ 4,888,000$

conservation groups. In recent years, their research has been at the forefront of anadromous fish recovery and floodplain science.

Data Management and Access

River Partners coordinates the sharing of data with the Central Valley Salmon Habitat Partnership (CVSHP), a joint venture conglomerate of environmental organizations and agencies dedicated to the recovery of anadromous fish species in California’s Central Valley. The CVSHP, as a large multi-stakeholder, multi-agency effort presents a unique opportunity to integrate vast amounts of salmonid and resource data from a great diversity of sources. Data compilation from across all partner Agencies and entities will allow comprehensive data-driven understanding of salmonid dynamics at the Central Valley scale.

The project team includes data management, analytics, and visualization experts from both private and public sectors already well versed with the scientific and gray literature and agency planning efforts such as NMFS recovery goals, Eco Restore objectives, CVPIA fisheries data, waterbird population data, Central Valley streamflow and operational data, and statewide soils, geology, hydrology, quality data, etc.

The CVSHP will also use the Programmable geographic Information System for Cataloging and Encoding Species observations (PISCES, Santos et al. 2014) to capture, store, map, and report on the spatial and temporal dynamics of targeted species by using standard spatial units as primary indexing objects to meet current natural resource management objectives. PISCES not only tracks the provenance of underlying empirical records through space and time, but also is robust to inferential modeling results and expert knowledge, which allows for future empirical discovery and validation. This approach is the basis of the Major Features of PISCES, including:

Scope - Multiple data type (expert knowledge, empirical, historical, inference) species presence tracking

Compatibility - Transforms external data to common format for analysis and decision support. Tracks and stores transformed data.

Data access and export – Includes ArcGIS toolbox for data modification and access. A robust map generation module produces complete range and summary maps into standard MXD, PDF, PNG, KML, SHP, CSV, and feature class formats.

Synthesis – Built-in support for advanced queries and maps to combine data for management support.

Data segmentation – species and data can be grouped into units, allowing unverified data to be kept from high quality data

We will also integrate all newly collected project-specific data in a cloud-based storage environment (e.g. Amazon Redshift or equivalent). We will use a dynamic ontology (i.e. a standardized naming convention that can be updated as new data types are brought into the database) to organize all data storage. The ontology will include measured and modeled data categories divided into structured (e.g. tables, comma separated text files, etc.) and unstructured (e.g. photos, videos, documents) formats with biological (e.g. waterbird assessments, surveys, etc.), physical (e.g. streamflow, soils hydrology, etc.),

and environmental (e.g. temperature, land use, etc.) data types, each having multiple metrics. As needed for analysis, we will also integrate existing data.

We will make this data publically accessible and useful with freely available "dashboarding" applications (e.g. Tableau Public) that allow easy access and manipulation of project data. Through this same platform, we will connect the project specific data with relevant regional data stored in public repositories such as CEDEN, CDEC, and the USGS surface water monitoring database. In addition, our team is well-versed in the ESRI environment for spatial data and will compile a comprehensive geodatabase for the project with metadata that conforms to the Biogeographic Information and Observation System (BIOS) metadata requirements and follows Federal Geographic Data Committee (FGDC) metadata standards. Our team is also familiar with a variety of State water quality databases, and water quality data collected in support of environmental compliance or conceptual design will be uploaded to CEDEN prior to the conclusion of the project. After project implementation, data on restored habitats will be uploaded to EcoAtlas Project Tracker.

Many scientific studies have recently been completed, documenting the significant benefits that off-channel habitats provide for out-migrating juvenile salmonids, including:

Juvenile Chinook salmon rearing in the Consumnes River and its floodplain For two consecutive flood seasons, researchers from the UC Davis Center for Watershed Sciences reared juvenile Chinook salmon within various habitats of the Cosumnes River and its floodplain to compare fish growth in river and floodplain habitats. Fish were placed in enclosures during times when wild salmon would naturally be rearing in floodplain habitats. The study found significant differences in growth rates between salmon reared in floodplain and river enclosures. Also, variable responses in both growth and mortality indicated the importance of providing habitat complexity for juvenile salmon in floodplain reaches of streams, so fish can find optimal places for rearing under different flow conditions (Jeffres et al. 2008).

Zooplankton ecology and trophic resources for rearing native fish on an agricultural floodplain in the Yolo Bypass Since 2011, researchers from UC Davis’ Center for Watershed Sciences, along with a consortium of landowners, conservation groups and public agencies, have been conducting experiments on flooded agricultural fields in the Yolo Bypass, simulating the historic floodplain conditions of the pre-developed Sacramento Valley. Several experiments have been conducted to measure the density of food resources (i.e. zooplankton) produced by, and the subsequent benefits provided (i.e. growth) to rearing juvenile salmon on inundated floodplains. The results suggested that inundated floodplains (in this case flooded rice fields) provide significant trophic resources to juvenile Chinook salmon based on high densities of zooplankton and other suitable habitat conditions have the potential to support a robust aquatic food web (Corline et al. 2017).

Rearing potential for restored floodplain habitat on the Sacramento River at Willow Bend In February 2015, River Partners science staff, along with consulting fish biologists, conducted an experiment to measure food production and trophic benefits for rearing juvenile Chinook salmon on a hydrologically connected floodplain of the Sacramento River (RM160L) at the Willow Bend Preserve. An existing floodplain drainage swale with a substrate consisting of mixed native grasses of was inundated with Sacramento River water and hatchery-origin Chinook salmon were reared over a period of 29 days. Over that time, the juvenile salmon grew an average of 167%, or 0.86mm per day.

More recently, beginning with initial flooding in late fall 2016 and continuing weekly through late May 2017, researchers from UC Davis’ Center for Watershed Sciences (member of our project team) sampled zooplankton, chlorophyll-a, and water quality parameters in both the Sacramento River and adjacent floodplain habitats at Willow Bend. Simultaneous sampling will allow the comparison of physical habitat parameters and biological response between the two habitats. Analysis of samples is ongoing at UC Davis to determine food web species composition, life stage and abundance; however preliminary data from the floodplain habitat samples was released just prior to this proposal submission. The analysis of these samples found high densities of zooplankton in the floodplain habitats following each flood event. Following the third flood event, abundance levels peaked at 75,000 individuals per m2 of floodplain (Figure 1).

Aquatic resource evaluations are being conducted over the next two winters as part of River Partners’ Sacramento River Salmonid Stranding Reduction and Floodplain Habitat Restoration Project at the

Willow Bend Preserve. Project History

River Partners was thrust into fish restoration efforts following a January 2016 high-flow event on the Sacramento River that inundated the northern portion of River Partners’ Willow Bend Preserve (Willow Bend). Willow Bend is located on the east bank of the Sacramento River, inside the SPFC levee and immediately upstream of the Moulton Weir in Colusa County. ±50 acres of restored native grassland within the property’s North Field routinely floods when the adjacent Sacramento River reaches an approximate stage of 76 feet – well before the river overtops the Moulton Weir. Through flow data analyses and property records, we found that the North Field has flooded at least one time in 13 of the past 15 winters, with the only two non-flood years occurring during the recent drought (Figure 2).

Figure 1: Abundance of zooplankton found in inundated floodplain habitat at Willow Bend. Dark blue is flow over Colusa Weir (Colusa Weir activation indicates Willow Bend inundation). Teal is number of individual zooplankton per m2 of floodplain. (Graph courtesy of C. Jeffres)

In the early morning hours of January 19, the North Field flooded for the first time that winter following a storm that brought intense rainfall to the foothills of the Sacramento Valley. When River Partners staff visited the property three weeks later, they were surprised to find most of the 50 acre field still underwater.

Although this prolonged inundation creates habitat for fish and wildlife, when put together, the conditions of Willow Bend’s North Field (i.e. consistent flooding, natural levee, bank revetment, and low topography away from the river) creates a detrimental opportunity for fish to become stranded. During the site visit a few weeks after the January 2016 event, River Partners staff began noticing small fish floating along the edge of the floodplain wetland. After the third deceased juvenile salmon was found, agency fish rescue personnel were notified, however, a fish rescue was not conducted due to the challenging conditions of the site. By the time the field had completely dried up, a total of 18 juvenile Chinook salmon had been found. The daily presence of herons, egrets, and other piscivorous birds suggested that a greater abundance of small fish had become stranded on the floodplain. That winter, high water events inundated the floodplain at Willow Bend on two separate occasions. Even though it

Figure 3: March 2016. Inundated floodplain at Willow Bend, 10 days after the second flood event that year.

Figure 2: 2003-2017 Flood reoccurrence at Willow Bend. The red line represents river stage at which the Sacramento River inundates the North Field.

disconnected from the river both times, once inundated, the north field performed like a historic Central Valley floodplain – retaining shallow, turbid waters rich with nutrients and aquatic food resources for several weeks at a time – providing exceptional off-channel habitat for anadromous fish and other wildlife (Figure 3, below).

During the recent wet winter (WY2017), Willow Bend flooded three times the amount it did in 2016. The frequent flooding allowed the floodplain to remain inundated from the first event in mid-December until it completely dried up in late-May. This continuous flooding and re-connection to the river presumably gave juveniles more opportunity to exit the off-channel habitat and return to the main channel under their own volition.

Dos Rios Pilot Study

Further south, in 2015 at Dos Rios Ranch, River Partners implemented a pilot study of fish rearing on floodplains in the Middle San Joaquin River. We found that water temperatures and conditions in inundated farm fields were conducive to explosive growth rates for juvenile salmon:

Water Quality Feasibility:

Typical agricultural water budgets present the amount of water needed to optimize crop growth and yields. Rarely do they refer to the source of the irrigation water. These budgets assume that water is cheap and available. Both of these assumptions are true at the properties River Partners owns now, and the Subject Properties. Water is available in large quantities, and is inexpensive. However, to farm and restore effectively, River Partners must evaluate the environmental costs of our irrigation practices against their benefits to crop production.

There are five kinds of water on the Subject Properties: river water that is diverted from both the San Joaquin and the Tuolumne rivers, groundwater that is pumped from a deep well, irrigation tailwater that captures “used” river water that can then be recirculated, floodwaters that flow onto the property, and water that naturally falls as rain. Each of these water sources is critical to both crop production, wildlife,

and water conservation. They are discussed in the context of Dos Rios Ranch below, but equally applicable to all the properties.

River Water All of the Subject Properties draw primarily from the San Joaquin and Tuolumne Rivers. Dos Rios Ranch meets the majority of its irrigation needs by diverting water from both the San Joaquin and Tuolumne rivers. Seven river pumps, four on the Tuolumne, and three on the San Joaquin, have a combined pumping capacity of 28,000 gallons per minute. During an average year approximately 8,350 acre-feet of water (over 2.7 billion gallons) is pumped from the rivers. The crops consume 7,020 acre-feet (see Appendix 1) so the efficiency of the irrigation system is 70%. Water is so cheap on this Ranch that this is not a problem. The low cost, and ready availability of water, has a huge impact on the management of this property. From an agricultural business perspective, water intensive crops, grown during the hottest temperatures of the year, make money - there is no financial incentive to conserve water.

Cheap river water benefits terrestrial and avian species but negatively impacts fish. The same water that supports Dos Rios’s green fields of alfalfa, corn, and wheat (in turn benefit geese, sand hill cranes, and Swainson hawks), also lowers river flows, increases water temperatures, and stresses salmon and steelhead. To benefit fish populations, the Ranch needs to reduce its reliance on river water. This can be accomplished by improving the farm’s irrigation efficiency, replacing corn with climate appropriate crops, utilizing dry-farming for winter cereals, and practicing deficient irrigation with alfalfa and other summer crops.

Tailwater The existing tailwater recovery system improves the farm’s irrigation efficiency by reusing the same river water for multiple irrigations. During each irrigation, excess water draining off every field is captured and pumped back into a 15-arce holding pond. This water can be used again for future irrigations, and in the interim, creates and supports wetland and riparian habitat. It also benefits fish by keeping more water in the river.

Rainfall The Dos Rios Ranch, on average, receives 12 inches (the equivalent of 1 acre- foot) of rainfall annually. This is enough water to grow winter cereals or a spring crop of oilseed. The most conservative water strategy would be to grow only climate appropriate crops. Utilizing dryland farming methods crops like wheat, oats, safflower, dry beans, sunflower, and sorghum could be grown. This is how this land was farmed before rural electrification and the wide spread adoption of irrigation became economically feasible. This approach optimizes the benefit to fish by keeping thousands of acre-feet of water in the rivers every year, but it would drastically reduce the economic output of the farm.

Ground Water There is one deep well on the property and this pump is currently used only as a last resort. The water is high in salts and is usually blended with river water to irrigate crops. If used exclusively, salts left behind from this water will build up in the root zone of the plants, reducing yields, and could eventually cause crop failures. Supplementing rainfall with only well water could be done by utilizing deficient irrigation. This is the practice of providing only one or two irrigations, at critical points, in the life cycle

of a crop. Rainfall still provides the majority of the crops water needs but a few, well-timed irrigations, can boast yields and add new crops to the mix. Examples of crops that have been successfully farmed under deficient irrigation include alfalfa, wheat, and tomatoes. Farm revenues would be higher than dryland but lower than fully irrigated farming. The benefits to wildlife would be the same as dryland agriculture that relies entirely on rainfall.

Floodwater By removing the small earthen berms between the fields and the rivers it is possible to increase the frequency and duration of flood events on the Ranch. Allowing floodwater back onto the property would help fill the soil profile with water, recharge the aquafer, and leach salts. Depending on the timing and intensity of events, floodwater and rainfall could provide enough water to produce optimum yields of winter cereals and spring oilseeds and legumes. Increased flooding would also offset the buildup of soil salts from the exclusive use of well water. If the farm irrigated using only groundwater and rainfall, increased flooding should increase revenues (most flood damage occurs during large events that are not protected by the berms). This approach would not allow the cultivation of summer crops and it is still completely weather dependent. However, farming the Ranch in this manner would provide the most benefits to fish. It would not divert any irrigation water from the rivers and it would also improve floodplain connectivity for young fish.

How the Dos Rios Example transfers to Subject Properties Well prior to acquisition, River Partners will have detailed knowledge of the water rights for each of the properties in the Project, including among other things: type (riparian or appropriative), owner of the right, the diversion season, diversion amount and diversion rate. Some properties will have riparian rights only, and some will have both riparian and appropriative rights. In most cases, River Partners already has the information since we are in negotiations or in contract. Additionally, River Partners is, or will be, in close communication with important water rights owners such as the Turlock and Merced Irrigation Districts. In every case, implementation of the Project will dictate changes to the water rights. After purchasing the Properties River Partners will forbear the use of riparian rights in favor of instream habitat for anadromous fish. In addition, River Partners will work closely with the irrigation districts, with whom we have relationships, to divert appropriated water toward the benefits claimed in this proposal.

By acquiring the subject properties, River Partners will retire the agricultural and dairy operation immediately. Later, separately funded, restoration will return Properties to a native riparian habitat. At the completion of restoration, native plants will be established in the water table and will not require irrigation. This change in land use will result in the following benefits:

• Enhanced Flows: The net amount of water dedicated to instream flow will depend on net

Evapotranspiration Applied Water (ETAW) reductions on the parcels, plus net reductions in use from other sources when available. Enhancement will be determined through an approved site-specific measurement and monitoring program.

• River Partners might also acquire additional water at a cost along the lines of current tiered

pricing. Working with the irrigation districts, River Partners and TID could provide approved metrics for the net benefits to instream flow from these additional non-diversions.

• All riparian rights, through a forbearance or 1707 dedication, would be left instream, thereby reducing direct diversions by an additional +/- 145 acre feet annually.

• Finally, all appropriative water is from the Tuolumne, is high quality water, and could be left in the Tuolumne (instead of delivered to the San Joaquin) if the parties and interests deem this to be the most beneficial result.

• There will be no difference for other agricultural water users because River Partners will be

taking the same amount of water out of the system as operations affected by current landowners.

We estimate approximately four acre feet per acre now used for irrigation/dairy use will be diverted for public benefit. When there is an appropriative right, the additional possibility remains of acquiring additional water at a scaled, but still highly favorable price, that varies based on water availability. An example of this year’s pricing for the additional water is posted on TID’s website here: http://www.tid.org/water/water-rates.

Once River Partners owns the Subject Property, it will seek to change the purpose of its use of its water entitlement from agriculture (dairy and alfalfa) to fish and wildlife purposes. To achieve this goal, River Partners will collaborate with TID and MID to dedicate entitlements, plus additional flows when available and affordable, to instream use under Water Code section 1707. As owner of the right, the districts would act as applicant for the 1707 transfer. As owners of the land, River Partners would continue to pay standard, below market TID water rates for use of the water for instream flow enhancement.

Going forward in perpetuity, River Partners or an appropriate subsequent land manager would continue to pay for the appropriative right, and could potentially purchase more water from TID each year, to protect the beneficial use of the water by delivering it directly instream. River Partners would stop growing the alfalfa and raising cows, and would restore the property to natural native habitats. During flood events, the restored acreage will have wetland habitat benefits for anadromous fish as described in the application and briefly below.

Using Property 3 as an example, River Partners would collaborate with the districts to dedicate to wildlife purposes an entitlement of approximately 1,140 af/y plus additional water depending on annual availability. The net amount of water dedicated to instream flow will depend on net ETAW reductions on the Mendonca parcels, plus net reductions in use from other sources when available.

The purpose of the instream flow dedication would be to improve endangered anadromous fish habitat in the San Joaquin River. The amount of water River Partners seeks to dedicate would be no less than the 1,140+/- af/y TID water diverted now by the dairy owners plus the 145+/- af/y acres of the riparian rights that is now being used for dairy and alfalfa. While River Partners could take more if it is willing to pay more, and will if we can coordinate such action with TID, our assumed amount is based on the status quo: by taking no more out of the delivery system than the owners now take, River Partners has no effect on other users. We expect the following benefits from this decision:

• Less resistance from other agricultural users when the 1707 is submitted for

public comment; • Greater willingness from districts to work with River Partners throughout the

process; • Opportunities for similar actions on other properties along the Tuolumne and

San Joaquin Rivers, especially within National Wildlife Refuge Boundaries.

Finally, River Partners will seek to time the release of the appropriative right for when it is most beneficial for the anadromous fish species, and we expect that the purpose will remain in place so long as a conservation interest continues to own the property (or, “in perpetuity,” consistent with expected State of California grant language and the federal National Wildlife Refuge Improvement Act that will govern once these properties are brought into the National Wildlife Refuge System.).

Finally, the geographic scope of the benefit depends partially upon success of our efforts in replacing agricultural and dairy operations, and restoring properties, and the precedent we will set along this critical stretch of river. The immediate effect is a timed flow of high quality water into the San Joaquin River that will impact fish habitat from the property location at least through the San Joaquin National Wildlife Refuge northern boundary. In addition:

• These Acquisitions is the first purchases within the new acquisition boundary of the San

Joaquin River National Wildlife Refuge boundary that follows the river upstream to the San Luis National Wildlife Refuge: the largest managed wetland west of the Mississippi River; and

• Bureau of Reclamation fish recovery efforts extending from the Merced confluence to the Friant Dam will also benefit from improved fishery management along stretches between the Merced and the Delta.

River Partners has experience with such dedications of water and is both known by and familiar with, the key agencies: the State Water Board, DWR, and BoR. We are working on a 1707 dedication in collaboration with the Tuolumne River Trust, the State Water Board, DWR, and the Bureau of Reclamation with respect to River Partners’ Dos Rios and Hidden Ranch Properties at the confluence of the Tuolumne and San Joaquin Rivers. As a result, we are already in dialogue with the relevant agencies

on the hurdles involved in such a dedication, and are actively working through those hurdles. The proposed 1707 is a lesser challenge than Dos Rios from a regulatory perspective because:

• The water doesn’t have to go far to be of benefit for fish and wildlife because all properties are inside of the San Joaquin National Wildlife Refuge boundary, and River Partners is not seeking to show a benefit beyond the refuge boundary, and

• We will be working through the TID with neighboring landowners who we know well already to effect the 1707. This is in contrast to a large string of landowners who remain downstream of the NWR boundary, and who are being included in the Dos Rios 1707 application.

Riparian Brush Rabbit

River Partners is continually receiving funding to directly support riparian brush rabbit (RBR) and riparian woodrat (RWR) habitat and population growth at Dos Rios Ranch. Funding has been obtained from both the Wildlife Conservation Board (WCB) and California Department of Water Resources (DWR). These non-federal funding sources have allowed River Partners to complete riparian habitat restoration at Dos Rios, including specific habitat and plant features benefiting the RBR and RWR. Restoration at Dos Rios is an on-going multi-benefit project that directly enhances the San Joaquin and Tuolumne River ecosystems. In addition, the species supported by the native habitat is a driving force in the restoration design at this project site. Specifically, River Partners develops a planting mosaic based on habitat needs of the species native to this region, including RBR, RWR, valley elderberry longhorn beetle, Swainson’s Hawk, and least Bell’s vireo.

Cost allocation & Economic Feasibility

The following table provides cost benefit estimates:

It is significant that the Properties are within a National Wildlife Refuge Boundary. The System is comprised of 563 national wildlife refuges, 209 waterfowl production areas, and 50 wildlife coordination areas totaling 150,393,936 acres of lands, waters, and interests in lands and waters administered by the Fish and Wildlife Service. The National Wildlife Refuge System is the only system of federal lands committed

Value of Water

Value of Salmonid Habitat

Value of Nutrient Avoidance

Value of Riparian Brush Rabbit Totals

Present Discounted Public Value 62,135,192$ 835,807,120$ 3,577,191$ 5,311,561$ 906,831,065$

Project Costs* 1,520,095$ 20,447,448$ 87,514$ 129,944$ 22,185,000$ Net Value 60,615,097$ 815,359,673$ 3,489,678$ 5,181,618$ 884,646,065$

* Monetized benefits are apportioned by the relative value of the benefits

Benefit Cost Ratio 41

principally to the conservation of wildlife, and the only such system in the world. Over time, we expect the agricultural uses along the immediate stretch of the river to dissipate in favor of fish and wildlife uses. River Partners, through this acquisition effort, is in fact incentivizing other conservation acquisitions and restoration activities within the Refuge. These activities, in turn, provide opportunities for additional benefits of the type described herein. The San Joaquin River National Wildlife Refuge, along with its neighboring refuges to the south and the Bay-Delta to the North, will form the front lines for our collective ability to reverse water quality problems in the Central Valley that threaten agriculture, our water supply and our standard of living in the Valley.

Additionally, the SJRNWR boosts the economy of the San Joaquin. Refuges in general attract more than 48 million visitors each year, offering activities such as wildlife-watching, hunting, fishing, photography, hiking, canoeing, kayaking and environmental education; they protect clean air and safe drinking water for nearby communities; generate more than $2.4 billion for local economies, create nearly 35,000 U.S. jobs annually, and return an average of $4.87 to local economies for every $1 appropriated to the Refuge System.

Environmental feasibility: The Project is environmentally feasible as it is limited to land purchases and bare minimum steps toward eventual restoration. No mitigation is required and public environmental benefits are 100% of the Project

Financial Feasibility:

River Partners has a long history of funding restoration projects as the table below demonstrates.

In addition, River Partners is exploring with partners additional funding sources to complement the more traditional grant sources. We are confident that they will mature to contribute value in the tens of millions over a period of years. The primary two funding sources are:

• New Markets Tax Credits • Riparian and Soil Carbon Sequestration Markets.