RECOMMENDATIONS FOR A WATER RESILIENCE

PORTFOLIO

AUGUST 2019

INTRODUCTION

California, and the world, have entered a new era. Climate change affects every facet of our lives: the air we breathe, the energy we use and the water we drink. We all must take bold and swift actions to protect our planet and the natural resources in California that sustain life.

In managing our state’s water resources, we must prepare for more frequent and severe multi-year droughts, changing precipitation patterns (more rain and less snow), and the harmful effects of sea-level rise and excessive algal blooms. The changes that affect California’s water supply and water quality also can lead to deteriorating effects in agriculture, ecosystems, infrastructure, energy use and production, and other areas.

To help California move toward its goal of a climate-resilient water system, the California Municipal Utilities Association (CMUA) offers the following eight recommendations.

1. Fill Data Gaps and Focus on Information Gathering and Modeling

2. Encourage Development of Innovative Financial Models for Water Management

3. Promote New Technologies and Research

4. Ensure Safe and Affordable Drinking Water for All Californians

5. Enhance Local/Regional Actions and Investments in New Water Supplies, Surface and Groundwater Storage, and Conservation/Water Use Efficiency

6. Employ Collaborative Approaches to Stakeholder Input and Community Engagement

7. Invest in Upper Watersheds and Actions to Reduce Occurrence and Severity of Wildfires

8. Advance California’s Climate and Energy Goals

Each of these recommendations is explained in more detail in this document. CMUA focused on developing a set of actions that will create an innovative, adaptable and sustainable future. The recommendations acknowledge the state needs an integrated approach to ensure the long-term viability of California’s water resources.

California Municipal Utilities Association 915 L Street, Suite 1210 Sacramento, CA 95814 (916) 326-5800 | cmua.org CMUA is the leading voice for California utilities, enhancing our communities. CMUA partners with community owned electric utilities and water agencies statewide to support reliable, sustainable, affordable water and energy services through advocacy, education and relationships. Together, CMUA members provide water service to approximately 70 percent of Californians and electric service to 25 percent of the state.

1. FILL DATA GAPS AND FOCUS ON INFORMATION GATHERING AND MODELING

Better data is necessary to implement actions that will build a climate-resilient water system. Accurate and comprehensive information is needed to make sound policy and important technical decisions. Data modeling also can spur the development of new metrics for measuring the performance of water resources, projects and programs. CMUA applauds the state’s commitment to bolster data integration through the Open and Transparent Water Data Act, but there is more to be done.

There are three specific gaps in data and information gathering that should be addressed in the near term. Doing so would be immediately helpful to water managers and regulators throughout the state.

ATMOSPHERIC RIVERS

Atmospheric rivers—narrow regions in the atmosphere that horizontally transport most of the water vapor outside of the tropics—deliver 30 to 50 percent of the West Coast’s precipitation and water supply. In California, atmospheric rivers pose serious flood risks when they make landfall or stall over a region; a strong atmospheric river can move 7.5 to 15 times the average flow of water at the mouth of the Mississippi River. Atmospheric rivers are the primary meteorological cause of extreme precipitation and flooding in California, according to the California Department of Water Resources (DWR). The intensity and duration of atmospheric rivers is expected to increase due to climate change. A better understanding of atmospheric river patterns—through more robust data collection—could potentially help California water managers and regulators to modify reservoir operations in ways that improve water capture and flood protection. CMUA supports the funding the state of California is providing for this purpose and we encourage the development of additional resources to advance data collection.

AERIAL SNOW SURVEYS

Data gathered from aerial snow surveys help determine how much water is stored in the snowpack and can inform local and regional agencies when and where runoff will be available, and when and how much water will be released from reservoirs that are managed for flood control. Inaccurate data can result in unnecessary water releases and increased flood risk. A better understanding of the snowpack through aerial snow survey technology could potentially help water managers and regulators identify and develop new reservoir operations options that improve water capture and flood protection. For example, the Aerial Snow Observatory (ASO) provides highly accurate snow course measurement in Turlock Irrigation District’s watershed. This technology developed by NASA’s Jet Propulsion Laboratory is the basis for SB 487 (Caballero) on aerial snow surveys. CMUA supports the passage of SB 487 and recommends California dedicate funding to implement additional, more sophisticated surveys as outlined in the legislation.

STREAM GAGE NETWORK

The state should provide funding to the DWR and the State Water Resources Control Board (SWRCB) to develop a plan to deploy a network of stream gages consistent with SB 19 (Dodd).

In addition, as the state looks at how to integrate various data sets, CMUA recommends merging water, public health, and social and economic data to develop new metrics and inform multi-benefit development of water supplies.

2. ENCOURAGE DEVELOPMENT OF INNOVATIVE FINANCIAL MODELS FOR WATER MANAGEMENT

California should review its existing policies and processes to identify funding, programs and projects that advance water management.

More comprehensive data, as discussed in Recommendation #1, could enable development of new analyses and metrics that foster innovative funding models, such as:

• Public/Private Collaborations – encouraging and allowing private capital to join in the development of water projects and programs with measurable outcomes;

• Collaborative Funding Arrangements – enabling multiple agencies to seek funding and development of water projects and programs; and

• Pay for Performance – tying project funding to performance on measured outcomes over time.

These types of innovative financial models encourage non-profits and NGOs to help fund experimental projects and programs that could advance water management across the state. This approach would help California learn what is most effective and what may not work in the development of climate-resilient water projects and programs.

3. PROMOTE NEW TECHNOLOGIES AND RESEARCH

As the climate changes, so must technology and research. Organizations like ImagineH2O have jump-started support for entrepreneurs and companies in the water sector that are designing and implementing innovative solutions for the world’s most pressing water problems. California should aggressively support efforts to harness the expertise and ideas of these water entrepreneurs, the technology sector and the state’s academic institutions to advance sustainable and adaptive approaches.

Research institutions and many other organizations in the water sector have worked diligently to develop new water treatment technologies with the goal of more effectively removing existing and emerging contaminants from the water supply. The state should provide and create conditions so that

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local agencies are encouraged to facilitate additional research, innovative approaches and pilot programs in the areas of advanced water treatment, water management, supply development and infrastructure, including a more streamlined regulatory process to enable these types of projects.

In addition, CMUA recommends that the state create a statewide innovation hub. We applaud the state’s efforts to incorporate new ideas through activities such as the California Water Data Challenge and the Water Data Hackathon, but formalizing a statewide initiative to spur and support innovation in the water sector, including investments in new technologies for water treatment and management, would help encourage the next generation of California water managers.

4. ENSURE SAFE AND AFFORDABLE DRINKING WATER FOR ALL CALIFORNIANS

Governor Newsom and the Legislature came together in 2019 to enact the Safe and Affordable Drinking Water Fund, a historic agreement for safe drinking water solutions in California and a critical step forward in achieving the Human Right to Water as state policy. In addition to ensuring the effective and efficient implementation of the Fund, the state should take additional steps to ensure water in California is both safe and affordable.

CONSOLIDATIONS

The SWRCB has several existing authorities in its toolbox to mandate consolidation of small disadvantaged community water systems, including SB 88, SB 1215 and AB 2501. Another important proposal is moving its way through the Legislature: SB 414, the Small System Authority Act of 2019, would enable two or more smaller, failing water systems to consolidate into one larger water authority that’s accountable to the local community. CMUA is co-sponsoring SB 414. We recommend that the state continue to prioritize the consolidations of small and disadvantaged water systems that do not have the technical, managerial and/or financial capacity to be sustainable in the long term.

WATER QUALITY REGULATIONS

One of the most daunting challenges for public water systems is complying with numerous water quality standards—and several more regulations are on the horizon. The California Office of Environmental Health Hazard Assessment and the SWRCB have pivotal roles to play in the development of these standards, but the adoption of each standard currently occurs in a vacuum without considering other contaminants possibly affecting the same system and potential treatment options that may add costs. The SWRCB should establish a comprehensive approach for evaluating future drinking water regulations. This approach should consider the economic impacts for notification, response, action levels and maximum

contaminant levels (MCLs), and should include analysis of these impacts on disadvantaged communities.

5. ENHANCE LOCAL/REGIONAL ACTIONS AND INVESTMENTS IN NEW WATER SUPPLIES, SURFACE AND GROUNDWATER STORAGE, AND CONSERVATION/WATER USE EFFICIENCY

The state of California has an important role to play in advancing a climate-resilient water system, but much of the progress and future actions needed to enable a sustainable future will occur at the local and regional level. Water agencies have pioneered many successful projects and programs that support local water supplies and benefit local watersheds and regions. Effective local actions often bolster and amplify state actions.

GENERAL RECOMMENDATIONS

When reviewing and adopting policies that affect local and regional entities, the state of California should consistently acknowledge the importance of local control, including the decisions water agencies make to ensure the long-term sustainability of their water supply. Any ranking or other determination of a water source or project’s viability and its contribution to a water supply portfolio should be left to the agency or entity developing the resource. The state should not adopt mandates that are technologically and economically infeasible or based on insufficient or inaccurate information.

And as the state looks to support local and regional projects, we recommend the state facilitate water systems’ efforts to undertake regionally—or organized by watershed—an approach that maximizes potable reuse, water recycling and stormwater capture. This type of “slow the flow” approach to planning and design should be continually supported.

Between potable water use, recycled water use, stormwater capture for groundwater storage, and distributed stormwater capture for onsite irrigation, a comprehensive strategy to “slow the flow” will allow for multiple uses and re-uses in a watershed—providing a more sustainable, resilient approach to local water use. Pilot projects should be encouraged to demonstrate solutions that are most beneficial to each region or watershed.

In addition, the state should promulgate regulations that focus on the best return on investment in terms of dollars per acre-foot and support water resource programs and projects that explicitly design for multiple benefits; California also should consider providing incentives for multi-benefit approaches as part of project funding and investment decisions. Multi-benefits should include environmental and equity objectives for communities that will be the direct beneficiaries of a project or program. The state also should take bold actions to allow for development of multi-benefit

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authorities, recognizing participation of multiple agencies in grant-funded or bond-funded projects or programs.

NEW WATER SUPPLIES

The state should double down on its commitment to advance potable reuse as a local and regional water supply development alternative. It’s essential for maximizing recycled water production and beneficial use in the state, and for improving ocean habitat conditions by reducing discharge through ocean outfalls. A serious commitment will require:

• substantial financial assistance to ensure that these expensive projects can be brought to fruition in a cost-effective manner; and

• the advancement of the state’s regulatory framework to accommodate more widespread potable reuse.

The SWRCB is developing criteria for certain types of potable reuse, which could dramatically change and expand the suite of options for wastewater agencies to beneficially reuse their water. The SWRCB also is developing regulations on surface water augmentation with recycled water. That process will inform available options for those agencies that are not near groundwater basins conducive to replenishment with recycled water, and it could change the dynamics of decision-making at some agencies. These regulatory processes should be finalized as soon as possible so that agencies can fully evaluate their options related to appropriate levels of treatment, available outlets for recycled water, and the best fit for a particular region and situation.

CMUA recommends that the state increase funding opportunities and streamline existing funding procedures for the design and construction of expanded recycled water systems and green stormwater infrastructure maintenance. The state should streamline and expedite regulatory processes and permitting for recycled water expansion projects, water/stormwater reuse, and the discharge of reverse osmosis concentrate resulting from increased utilization of effluent for purified water. In particular, the SWRCB should prioritize the completion of regulations to enable non-potable recycled water projects. Clarification of regulatory oversight of municipal recycled water vs. onsite reuse—as well as requirements for blending municipal recycled water with stormwater—also is needed.

The state should encourage the use of “nuisance” water, such as water from basement dewatering or rainwater harvesting. The state should establish regulations for blending nuisance water with water from existing municipal recycled water systems. Rainwater water quality regulations are not as strict compared to Title 22, which applies to recycled water. Water suppliers must apply the most conservative restrictions to blended water, which may prevent implementation of a blending project. Furthermore, some groundwater sustainability agencies charge groundwater pumping fees based on the beneficial use of the water. This creates a disincentive to use nuisance water produced as a byproduct of other activities, such as basement dewatering, which is

becoming more common. Legislation may be necessary to remove the financial disincentives associated with reusing nuisance water.

SURFACE AND GROUNDWATER STORAGE

Additional surface and groundwater storage projects are key elements of a climate-resilient water system, especially given the increasing proportion of rain events instead of the snowpack, which historically has served as a main water storage resource for California. The storage proposals that received funding from Proposition 1 will undoubtedly help increase the state’s overall storage capacity, but there is a large unmet need on both the statewide and regional scale. We urge the state to put more focus on investments in surface and groundwater storage, review the regulatory processes that govern the development and construction of storage projects, and look for streamlining opportunities that will help improve the pace of projects coming online.

CMUA also strongly recommends the state collaborate with local water agencies and regional entities to review options for the construction of additional large-scale regional storage facilities. If possible, there should be an emphasis on integrating surface and groundwater storage and constructing the projects in conjunction with hydroelectric power generation to meet California’s zero-carbon emission goals.

CONSERVATION/WATER USE EFFICIENCY

In 2018, the state passed groundbreaking legislation “Making Conservation a California Way of Life.” There are myriad new requirements for water systems that will help ensure the long-term sustainability of California’s water resources. CMUA encourages the state to continue providing support and technical assistance to meet the new water use objectives, including water loss. While the development of water loss performance standards is a result of SB 555 (Ch. 679, Stat. 2015), these standards will play a critical role in the overall objectives; they are one component of the total target.

During the development of the validated water loss audit process—the first component of SB 555 implementation—both the state and water suppliers discovered data collection and verification can be challenging when implementing new reporting requirements and protocols. The SWRCB’s previous funding for the CA-NV AWWA Water Loss Technical Assistance Program proved that data quality is greatly improved when there is adequate time, training and funding. CMUA recommends that the state consider funding additional Technical Assistance for Phases 1 and 2 of the water loss performance standards regulatory framework, specifically the leakage component analyses. As currently proposed, the framework would require three analyses to be conducted between 2022 and 2026. Without assistance, even those suppliers familiar with water loss will struggle to implement a leakage component analysis model along with procedures that properly inform the performance standards. Early assistance will be critical for suppliers that exceed the state’s standard. Additional time for training and implementation will result in significantly improved data

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collection and submission, whereas poor data quality inputs will result in unrepresentative standards.

6. EMPLOY COLLABORATIVE APPROACHES TO STAKEHOLDER INPUT AND COMMUNITY ENGAGEMENT

Organizations and communities with a stake in California’s water future are plentiful and diverse. Incorporating the perspectives of these groups is essential to advancing technical and policy decisions that are practical and sustainable.

California should enhance efforts that allow for early stakeholder participation and continuous feedback in regulatory and policy processes. Input is needed from a diverse group of stakeholders—individual residents, community leaders, community-based organizations, artists, educators, leaders from municipalities nationwide with similar challenges, and a range of other “uncommon partners.” Diversity will strengthen the planning and solutions offered.

The state also should continue to enable and facilitate cross-agency collaboration at the state and local level, both across geographical boundaries (e.g., water managers with different jurisdictions in the same watershed) as well as different areas of focus (e.g., water, health, parks, transportation, housing, and emergency management). For example, alternative water supply development, such as potable reuse, puts sanitation districts in a critical position to lead and/or collaborate with traditional water supply agencies in the development of next-generation water supplies.

7. INVEST IN UPPER WATERSHEDS AND ACTIONS TO REDUCE OCCURRENCE AND SEVERITY OF WILDFIRES

The wildfire season is now year-round and getting worse in terms of total acreage and impacts to people, communities and the environment. Numerous factors have led us to this situation, including historical land management practices and climate change. CMUA appreciates the state’s attention to this important issue in both the legislative and regulatory arenas. The recommendations in this area would complement and enhance those efforts.

IMPROVE FOREST AND VEGETATION MANAGEMENT

In addition to climate change, historical forest management practices have contributed to thick stands of forests that are explosive tinder in the event of a wildfire. Proper fuel treatment and vegetation management supports forest health, improves water quality and water supply conditions, and helps mitigate the risk of larger fires that result in

serious public health and safety concerns, significantly higher air pollution and greenhouse gas emissions. The state is beginning to address this problem, as outlined in a CalFire staff presentation to the Commission on Catastrophic Wildfire Cost and Recovery in February 2019. However, CMUA recommends California dedicate additional resources at the state level and work with the federal government to secure additional funding that supports enhanced forest management efforts. CMUA supports Governor Newsom’s efforts to partner with the governors of Washington and Oregon to call on the federal government to double its investment in managing federal forestlands. More prescribed burning and more mechanical thinning where applicable would result in improvements, and we support the state’s continued efforts to increase investments in forest management. CMUA also supports recent actions in the state budget for new firefighting equipment and vegetation management, along with the first Governor’s Emergency Preparedness Summit and Governor’s Newsom’s declaration of a statewide emergency to facilitate 35 critical forest-management projects. We also encourage the state to provide funds to local communities for watershed management projects that can improve water supply and quality, and reduce the risk of destructive wildfires.

CMUA also supports efforts to bring to light the critical role of landowners in maintaining defensible space and reducing the potential impacts of wildfires. We recommend that the state engage in public education campaigns to urge landowners to ensure their property is in compliance with applicable defensible space requirements. Recent policies at the federal and state levels take important steps to address challenges that energy and water utilities face in managing vegetation around their infrastructure. We strongly recommend that the state provide a framework for assisting publicly owned electric utilities and water agencies to expedite vegetation management around power lines and other rights-of-way with CEQA exemptions similar to the recent federal exemptions that are being implemented for federal lands. For example, some of California’s publicly owned utilities have been waiting as long as two years for vegetation management permits.

Furthermore, we recommend the state increase workforce training and development opportunities in the context of fire prevention and suppression. As proposed in CalFire’s Community Wildfire Prevention & Mitigation Report (February 2019), we are supportive of the Natural Resources Agency identifying specific opportunities for developing workforce training programs that could increase the number of properly trained individuals available to assist with fuels reduction and forest management efforts, among other areas.

SUPPORT ACTIONS TO REDUCE WATER SUPPLY IMPACTS FROM DE-ENERGIZATION EVENTS

Recognizing the risk of a wildfire igniting from an electric distribution or transmission line, California’s investor-owned electric utilities have incorporated de-energization of power lines into their safety plans for reducing the

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likelihood of such a scenario. Along with impacts on affected communities, these actions are expected to have significant impacts on water agencies, such as the inability to pump water, inadequate fire flows, sewage backups and no air conditioning in facilities with temperature-sensitive equipment. Many water agencies have started purchasing additional emergency generators to try and provide continuous water service during a shutoff, but they are extremely expensive and need to be purchased immediately or in the near future, straining the agencies’ finances. These agencies also may face logistical challenges installing new generators and, for some existing generators, properly testing them due to air quality restrictions.

We strongly recommend the state support water agencies in their efforts to ensure a reliable water supply in the event of a power shutoff, including financial assistance through emergency loans or grants and collaboration with the California Air Resources Board and regional air quality management districts to ensure water systems can properly test all existing generators so they remain operational in an emergency. In addition, we support actions by the California Public Utilities Commission to facilitate robust communication between investor-owned utilities and public water agencies in advance of a public safety power shutoff event, to the greatest extent possible.

IMPROVE COMMUNICATION AND COORDINATION

CMUA recommends the state invest in improved communication and coordination between fire officials and water and energy utilities, especially to facilitate sharing of critical data. Additionally, the state should undertake robust public education efforts to ensure residents, particularly those in high fire-threat areas, have a plan in place to respond quickly to wildfires. This will help reduce issues during evacuations and will hopefully save lives. We support customer education campaigns to support emergency preparedness in those communities. These efforts include providing information on how community members can be prepared in the event of a power outage. CMUA welcomes the opportunity to partner with the Governor, Legislature, and local governments on a broader effort that would reach all Californians. Furthermore, we urge the state to lead an effort to streamline access to disaster relief to ensure communities are supported and water and electric service can be promptly restored.

ENHANCE FIRE SUPPRESSION AND EMERGENCY RESPONSE

Protecting communities is the top priority and, toward that end, we agree with many policymakers that California must have a modern public safety system that is able to readily alert residents of impending disasters, including wildfires, and to put forward sufficient resources to respond accordingly. Legislation was enacted in 2018 to improve public alert systems and to increase the effectiveness of the state’s mutual aid response system. It is vital that California continues to build on these improvements, and that the state budget includes funding for an upgraded 911 system

to protect residents. This should include ensuring CalFire and local fire departments are adequately staffed and have sufficient resources to suppress fire. Firefighting resources are inadequate in some areas. For example, the city of Redding has historically only been able to staff its fire engines with two firefighters, as opposed to the standard three-person crew. To improve fire response in the community, the Redding Electric Utility will be funding an additional 12 firefighting positions to improve the city’s capabilities. These types of deficiencies must be remedied statewide.

ADDRESS LOCAL PLANNING

Millions of Californians live in high fire-threat areas. We support efforts to re-evaluate local planning and development policies for businesses and residences in these areas, including those in the wildland-urban interface. We also agree with the recommendation of the Rural County Representatives of California to work with local governments to establish best practices on development in high wildfire-threat areas to protect public safety.

8. ADVANCE CALIFORNIA’S CLIMATE AND ENERGY GOALS

California has enacted aggressive climate and energy goals that significantly impact water agency operations. For example, electric utilities must procure 60 percent of their energy from renewable sources by 2030, and it is state policy that RPS-eligible and zero-carbon resources supply 100 percent of all retail sales of electricity to California end-use customers, including water agencies, no later than 2045. California also has set a goal to reduce the state’s greenhouse gas emissions to 1990 levels by 2020, 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050. Supplying water to Californians depends on a significant amount of energy. Therefore, it is critical to review these goals in the context of water management—including costs, benefits and water agencies’ role in these efforts—as California works toward a climate-resilient water system.

Many elements are needed to maintain reliability and affordability during California’s shift to renewable power and meet zero-carbon emission objectives, including cost-effective and durable energy storage technologies. These solutions include large-scale energy storage systems that help balance generation with demand, provide electric grid stability, and provide carbon-free power supply over long periods. The state should initiate a discussion on the cost-effective and reliable integration of energy storage, including larger scale bulk storage, through the joint-assessment required by SB 100, the Integrated Energy Policy Report, or another existing process, to help achieve the state’s zero-carbon emission objectives.

In addition, we recommend that the state support efforts to increase the pace and scale of climate-resilient water programs and projects by:

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• streamlining the California Environmental Quality Act (CEQA) when implementing such programs and projects. An example from forest health was a limited CEQA exemption in SB 901 (Ch. 626, Stat. 2018);

• streamlining and expediting permitting for levee improvement projects that are needed for climate change adaptation;

• increasing staff at state agencies to help accelerate projects that involve the San Francisco Bay Conservation and Development Commission and the State Lands Commission;

• considering climate resiliency at the regional level when developing programs and projects related to impacts of sea level rise, future demand of reservoirs, and natural disasters caused or accelerated by climate change; and

• providing energy credits or exemptions for the treatment of local water supplies impacted by water quality issues (PFAS, nitrates, VOCs, etc.), which would encourage water systems to develop and/or maintain local water supplies.

Finally, the state can take two near-term actions that would help advance the state’s climate goals: First, provide sustainable funding for the DWR Water-Energy Grant

program and increase funding opportunities for water agencies to make investments in their water systems that will decrease GHG emissions. Second, reinvigorate the Water-Energy Team of the Climate Action Team (WET-CAT). WET-CAT is tasked with coordinating efforts to reduce GHG emissions associated with the energy intensity of water use, and that in turn helps with efforts to address potential climate change impacts to water. This collaboration between state agencies and stakeholders, including the water community, has been a productive venue to share information and best practices.

CONCLUSION

CMUA applauds Governor Newsom for his call to develop a portfolio of actions that will create a climate-resilient water system in California. From floods and droughts to wildfires and power shutoffs, the effects of climate change already are impacting the state’s water resources in a variety of ways. California must plan for a future that is changing right in front of our eyes. To create a climate-resilient water system it will take the collective efforts of all stakeholders, including those involved in water quality, supply and management. CMUA stands ready to work with all stakeholders to accomplish these aggressive but necessary goals.

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