DATE:
April 16, 2024
TO:
Mayor and Council Members
Chair and Board Members, Hesperia Water District
FROM:
Rachel Molina, City Manager
BY:
Cassandra Sanchez, Director of Public Works/City Engineer SUBJECT:
Approval of a Letter of Intent by and between the City of Hesperia and Fenner Gap Mutual Water Company
RECOMMENDED ACTION
It is recommended that the City Council authorize the City Manager to approve a Letter of Intent (LOI) by and between the City of Hesperia and Fenner Gap Mutual Water Company.
BACKGROUND
The City of Hesperia is part of an adujicated water basin (City of Barstow et al, v. City of Adelanto et al) which is intended to remediate overdraft in the Mojave Basin Area by limiting the amount of water produced in specific subareas. The ajducation determines the Free Production Allowance (FPA), which is the maximum amount of water a producer may pump in one year without incurring a replacement or make-up obligation. As a result of the judgment, Hesperia Water District (District) incurs replacement water obligations in the Alto Subarea when verified production amounts exceed the FPA for the water year.
Historically, the City and District may meet these replacement water obligations by three mechanisms:
Assignment of carryover right or temporary transfer of unused FPA (i.e. lease) from interested water rights owners in the respective subarea at negotiated rates (this is a cost effective short-term option to meeting the production demands); Purchase water from the Mojave Basin Area Watermaster (Watermaster) at the current per acre foot (AF) water rate which is derived from the State Water Project water rates; and/or Purchase permanent water rights from interested parties in the Alto Subarea at negotiated rates (purchase provides a long-term solution, but is costly and difficult to acquire).
The Fenner Gap Mutual Water Company (FGMWC) has approached the City with a potential fourth solution for the replacement water obligations by providing water from a currently undedicated water source to use toward groundwater basin replenishment. Using a new water supply from the Cadiz-Fenner Valley Watershed, the Cadiz Water Project has discussed a regional plan with the City, as well as other public agencies in the surrounding areas, and asked that interested parties to sign an LOI to participate in the Mojave-San Bernardino One Water project.
The FGMWC is a non-profit California mutual water company consisting of water providers participating in the Cadiz Water Project. The Cadiz Water Project is a water supply project that aims to transport water from the Cadiz and Fenner Valley, which is located approximately fifteen miles east of Amboy, California to the Greater Mojave Valley. Importantly, the Cadiz Water Project looks to capture and transport water that would otherwise be lost to evaporation and bring it to this region of San Bernardino County. The Cadiz Water Project will utilize the existing Northern Pipeline, which is a 220 mile pipeline that extends from the Fenner Valley west to Kern County and through Barstow, CA.
The Mojave-San Bernardino One Water project will eventually work together in the design, development, construction and operation of water infrastructure facilities necessary to utilize this water in the Mojave Basin Area.
ISSUES/ANALYSIS
The LOI will initiate Hesperia’s participation in the Mojave-San Bernardino One Water Project. This project will be a collaborative effort by participating agencies in the design, development, construction, and operation of water infrastructure facilities necessary to utilize all potential sources of water to create water security, climate resiliency and equitable distribution of water resources in Mojave Basin and other connected regions in San Bernardino County.
By participating in the Mojave-San Bernardino One Water Project, the LOI offers the good faith delivery of up to 75,000 acre-feet of water to the City of Hesperia.
FISCAL IMPACT
There is no fiscal impact at this time for authorizing the approval of a LOI by and between the City of Hesperia and FGMWC agreeing to participate in the Mojave-San Bernardino One Water Project. Should the project proceed, the City will work towards an agreement, and have a share of costs, which will be presented to the City Council/Board of Members of the Hesperia Water District at a future date for consideration.
ALTERNATIVES
Provide alternative direction to staff.
ATTACHMENTS
Letter of intent by and between the City of Hesperia and Fenner Gap Mutual Water Company Exhibit A - Term Sheet for Purchase, Sale and Exchange of Water By and Between Fenner Gap Mutual Water Company and the City of Hesperia City of Hesperia STAFF REPORT City of Hesperia STAFF REPORT City of Hesperia
STAFF REPORT
City of Hesperia
STAFF REPORT
Staff Report to the Mayor and Council Members - Approval of a Letter of Intent by and between the City of Hesperia and Fenner Gap Mutual Water Company April 16, 2024