ADMINISTRATIVE REPORT
MEETING DATE: August 26, 2026 AGENDA CATEGORY: Consent - Resolutions TO: Honorable Mayor and City Council
FROM: Daniel Maldonado, Assistant Water Director
DATE: August 11, 2026
SUBJECT: Resolution Authorizing City Staff to Submit an Out-of-Agency Service Area Application to Kern LAFCo
Resolution Authorizing City Staff to Submit an Out-of-Agency Service Area Application to Kern LAFCo
RECOMMENDATION:
City Staff recommend adoption of the resolution.
BACKGROUND:
i. Matter Background
In 2015, the California Legislature passed Senate Bill 88 (“SB 88”). Among other things, SB 88 empowered the State Water Resources Control Board ( “SWRCB”) to order the consolidation of water systems that consistently fail to provide an adequate supply of safe drinking water with a receiving water system that can. In essence, SB 88 empowered the SWRCB to compel functioning w ater systems to consolidate or integrate failing water systems so the users within the failing water system can access potable water.
The Old River Mutual Water Company (“ORMWC”) and the South Kern Mutual Water Company (“SKMWC”) (collectively, the “Mutuals”) are both located outside of City of Bakersfield’s (“City”) city limits but within City’s sphere of influence. Together, the Mutuals serve approximately 80 individuals. Since approximately 2016, neither of the Mutuals has been able to provide an adequate supply of safe drinking water to their users. Neither of the Mutuals possesses the technical, managerial, or financial resources to remedy those circumstances.
On September 27, 2018, the SWRCB issued two (2) mandatory consolidation orders: (1) Co nsolidation Order No. 03 -12-18R-003 (“Order 003”), and (2) Consolidation Order No. 03 -12-18R-002 (“Order 002”) (collectively, the “Consolidation Orders”). Order 003 pertained to ORMWC; Order 002 pertained to the South Kern Mutual Water Company (“SKMWC”). The Consolidation Orders required City to undertake the consolidation of both ORMWC and SKMWC into City’s municipal water system (the “Mandatory Consolidation”).
On February 02, 2024, SWRCB issued Compliance Order No. 12-E1-23R-002 (“Compliance Order 002”) and Compliance Order No. 12-E1-23R-003 (“Compliance Order 003”) (collectively, the “Compliance Orders”).
The Compliance Orders appointed Provost and Pritchard Consulting Group (“P&P”) as the Mutuals’ “full scope administrator.” As of this writing, P&P is still the full-scope administrator for the Mutuals.
ii. Environmental Compliance is Complete
As of August 23, 2025, this Mandatory Consolidation’s environmental review has concluded. City’s review resulted in its adoption of a Mitigated Negative Declaration formally titled “Consolidation of South Kern and Old River Mutual Water Companies into the City of Bakersfield Water System, AR 6060 Prop 1 Project” (hereinafter, the “MND”). For the Council’s awareness, Bakersfield’s Planning Commission
held a public hearing for this Mandatory Consolidation and approved the MND. The City Council itself considered and approved the MND on July 23, 2025. City Staff transmitted to the State Cleari nghouse and County of Kern a “Notice of Determination” (“NOD”) concerning the MND. No parties have challenged that process.
iii. Construction is Planned
City intends to extend drinking water services to the Mutuals’ current service areas in two (2) phases:
Phase 1: Waterline Extension: City will construct the waterline extension required to connect the Mutuals’ current service areas to City’s municipal water system. Beginning at the intersection of McCutchen Road and Old River Road, City will install a ten-inch (10”) water line that will run south to the intersection of Old River Road and Taft Highway. The ten-inch water line will then cross Taft Highway and Kern Delta Water District’s Stine Canal before continuing south along Old River Road. The ten-inch water line will, at the intersection of Old River Road and Beam Street, turn east. At this location, the water line will also transition from a ten-inch eater line to an eight -inch (8”) waterline. From the last referenced intersection, this eight-inch water line shall continue east to the intersection of Beam Street and Pars Street. At the intersection of Beam Street and Pars Street, the water line splits into two (2) lines: one eight-inch line shall run south along Pars Street for approximately 100 feet before terminating in an end- of-line blowoff; the other eight -inch line shall run north along Pars Street to the T -intersection of Pars Street and Taft Highway before terminating in an end-of-line blowoff.
Phase 2: Lateral Line Installation: P&P shall engage a contractor to construct the laterals running from the City’s waterline to parcels within the Mutuals’ current service area.
iv. SWRCB Awarded City $6,813,373 for Mandatory Consolidation From this matter’s beginning and up to the pre sent, this Mandatory Consolidation has been a SWRCB funded effort. To date, the only City funds expended in this effort have been those that compensate staff for ‘staff time.’ The State of California, pursuant to the Expedited Drinking Water Grant Program (“EDWG Program”) shall reimburse City for those funds it expends during the Mandatory Consolidation.
On January 17, 2026, SWRCB notified City that it had been given preliminary approval and transferred City’s funding request to the EDWG Program.
On June 16, 2026, SWRCB and City entered into EDWG Agreement No D2502028 (the “EDWG Agreement”). The EDWG Agreement awarded $6,813,373 to City for the purpose of effectuating the Mandatory Consolidation. Exhibit B of the EDWG Agreement provides the procedu re by which City will coordinate with SWRCB to reimburse its costs.
v. Kern LAFCo Approval is Necessary to Move Forward
The EDWG Agreement prohibits City from beginning any construction until all necessary public agency approvals have been obtained. Be cause the Mutuals’ service areas lie outside City’s city limits, City coordination with the Kern County Local Agency Formation Commission (“Kern LAFCo”) is required to effectuate the Mandatory Consolidation.
Government Code section 56133 authorizes LAFC o to approve an out -of-agency service agreement provided the subject areas are within City’s sphere of influence and experiencing a threat to the health and safety of the public. As stated above, the Mutuals’ service areas lie outside of City’s city limits but
within City’s sphere of influence – and the Mutuals are experiencing a threat to the health and safety of the public due to the persistent lack of potable water. Therefore, any extension of City water services requires the approval of Kern LAFCo. Water Staff have begun coordination with Kern LAFCo and engaged in informal conversations regarding how to navigate this process.
Water Staff have prepared an application requesting Kern LAFCo approve an “Out -of-Agency Boundary Service Agreement” that authorizes City to execute the Mandatory Consolidation described above.
FISCAL IMPACT:
Sufficient funds are budgeted within the Mun icipal Water Fund for this effort. Additionally, p roject expenditures will be fully reimbursed by SWRCB , therefore, there is no impact to the General Fund with this action.
COUNCIL GOAL:
Reliable Infrastructure
ATTACHMENTS:
1. Resolution Authorizing Out-of-Service LAFCo Application
2. City of Bakersfield Out-of-Agency Service Area Application with all Exhibits