City Council Agenda Report
TO: Mayor Clauzel and Members of the City Council
FROM: Fernando Ulloa, City Manager
BY: Bryan Stice, Community Development Director
MEETING DATE: April 1, 2025
ITEM NO: 7.1
SUBJECT: Informational Item regarding Patterson Irrigation District, et al. v. City of Patterson, et al. Alameda County Superior Court (Case No. 23CV028091) Settlement Agreement terms.
RECOMMENDATION
This informational agenda item provides explanation and background for terms from the settlement agreement in the California Environmental Quality Act (“CEQA”) litigation regarding the Environmental Impact Report ("EIR”) for the Zacharias / Baldwin Ranch Master Plan (the “Master Plan”). Specifically, the settlement terms discussed in this item relate to the Del Puerto Creek Capture and Recharge Project and water supply to offset demand from new development.
BACKGROUND
Zacharias/Baldwin Ranch Master Plan & Environmental Impact Report On August 16, 2022, the City of Patterson City Council approved the Master Plan which comprehensively planned, designed, and prescribed development of residential, commercial, mixed-use, industrial, and public/education land uses over approximately 1,297 acres, comprising the City’s northern future growth area. At the same meeting, the City Council certified the Master Plan EIR and amended the City of Patterson General Plan land use map to correspond with those land uses established within the Master Plan.
The Master Plan EIR is comprised of the Draft EIR, dated December 3, 2020, and the Final EIR, dated July 1, 2021. Notably, the Master Plan EIR (hereinafter “EIR”), analyzed the following hydrologic impacts:
Impact HYD-2: Would buildout of the project substantially decrease groundwater supplies or interfere substantially with groundwater recharge such that the project may impede sustainable groundwater management of the basin? Impact HYD-5: Buildout of the Master Plans would not conflict with or obstruct implementation of a water quality control plan or sustainable groundwater management plan.
In analyzing Impacts HYD-2 and HYD-5, the EIR made presumptions regarding water availability and water use based on the City’s 2018 Water Management Plan, the project’s 2020 Water Supply Assessment, and the 2019 Groundwater Sustainability Plan. The EIR’s analysis of HYD-2, identified that the Master Plan would have the following effects:
· Increased demand for potable water of 1,560-acre feet per year, which would be met by increased groundwater pumping from the lower aquifer; and · The increased groundwater demands are within the “safe” yield based on the 2018 Water Management Plan; and
· The Recharge Basin Facility would recharge the lower aquifer and help offset the increased potable water demand and meet sustainability goals pursuant to the Sustainable Groundwater Management Act.
Accordingly, the EIR concluded that Impact HYD-2 and HYD-5 were less than significant, and no mitigation was required.
Sustainable Groundwater Management Act
In August 2014, the California Legislature passed, and in September 2014 the Governor signed, legislation creating the Sustainable Groundwater Management Act (“SGMA”) “to provide local groundwater sustainability agencies with the authority and technical and financial assistance necessary to sustainably manage groundwater” (Wat. Code, § 10720.1). In adopting SGMA, the California Legislature declared the following:
(1) The people of the state have a primary interest in the protection, management, and reasonable beneficial use of the water resources of the state, both surface and underground, and that the integrated management of the state’s water resources is essential to meeting its water management goals.
(2) Groundwater provides a significant portion of California’s water supply.
Groundwater accounts for more than one-third of the water used by Californians in an average year and more than one-half of the water used by Californians in a drought year when other sources are unavailable.
(3) Excessive groundwater extraction can cause overdraft, failed wells, deteriorated water quality, environmental damage, and irreversible land subsidence that damages infrastructure and diminishes the capacity of aquifers to store water for the future. (4) When properly managed, groundwater resources will help protect communities, farms, and the environment against prolonged dry periods and climate change, preserving water supplies for existing and potential beneficial use. (Legislative Preamble to SGMA, Water Code §10720 et seq.) SGMA requires sustainable management of groundwater consistent with the California Constitution (Water Code § 10720.5), which mandates that conservation of water resources, “be exercised with a view to the reasonable and beneficial use thereof in the interest of the people and for the public welfare.” (Cal. Const. Art. 10, § 2.).
Under SGMA, sustainable management is achieved through the development of groundwater sustainability plans (“GSP”), which can be a single plan developed by one or more groundwater sustainability agencies (“GSAs”) or multiple coordinated plans within a basin or subbasin (Wat.
Code, § 10727). The City formed the City of Patterson GSP, which is one of twenty three GSAs that have been formed in the Delta-Mendota Subbasin. The GSAs submitted six separate GSPs in 2019, before the Master Plan EIR was certified. Separate GSPs are permitted under SGMA, but SGMA and state Regulations still require a degree of consistency and coordination between the GSPs.
In its March 2, 2023, Determination Letter, DWR deemed the GSPs “Inadequate.” (Attachment 1) The main concern of DWR was that the six GSPs were not truly coordinated by not using the same data and methodologies. Following the “Inadequate” determination, state intervention was triggered, and primary oversight of the Delta-Mendota Subbasin was transferred to the State Water Resources Control Board (“SWRCB”) to conduct a hearing and determine whether the Subbasin should be placed on probationary status. This hearing has not yet occurred and, in the interim, the GSPs were encouraged to continue to try and bring the GSP into compliance.
In response to the Inadequate Determination Letter, the Delta-Mendota Subbasin GSAs worked collectively to prepare one unified GSP for the Subbasin. In June 2024, the Coordination Committee posted a draft of the 2024 GSP on the Subbasin’s website for public comment and held public workshops regarding the revisions to the GSP. After considering public comments and upon further discussion, on July 22, 2024, the Coordination Committee unanimously recommended that all GSAs in the Delta-Mendota Subbasin adopt the 2024 GSP. On November 19, 2024, Patterson City Council voted to approve Resolution No. 2024-62, adopting the 2024 Single GSP for the Delta-Mendota Subbasin.
2024 Groundwater Sustainability Plan & Pumping Reduction Plan The 2024 GSP includes a major key change from the 2019 GSP, which affects the City’s groundwater supply planning and changes some of the circumstances that existed when the Master Plan EIR was prepared. The key change is through the introduction of a subbasin-wide Pumping Reduction Plan (“PRP”). The PRP requires the basin to reduce groundwater pumping by 42,000-acre feet per year (“AFY”) by 2030 to achieve sustainable conditions based on historical overdraft. This reduction applies predominantly to pumping from the lower aquifer which supplies essentially all of the City’s potable water supply. This overdraft calculation is based on historic groundwater pumping records from the period of 2002 - 2023, which was before Master Plan Area was annexed into the City and, of course, before any of the Master Plan area is constructed and the increased water demand is present.
Effective January 1, 2025, the City is responsible for implementing the first step in an incremental groundwater pumping reduction by reducing its 2025 groundwater pumping from the lower aquifer by 92 AFY. This target will increase gradually over the next five years to reach a lower aquifer pumping reduction of 460 AFY by 2030. The 2024 GSP identifies two primary methods for the City to achieve its allotted pumping reductions. (1) Implementation of the Recharge Basin Facility, which was contemplated in the Master Plan EIR. This facility would be located in an area that would allow recharge to the lower aquifer, from which the City almost exclusively pumps its potable water supply.
(2) Implementation of a water supply portfolio with a reduced reliance on groundwater.
This portfolio was detailed in the City’s 2018 Water Management Plan, where it is referred to as Supply Portfolio No. 4, and achieves a low reliance on groundwater through purchase of a long-term surface water transfer agreement, conservation efforts, the Recharge Basin Facility, and use of recycled water for non-potable reuse.
DISCUSSION
Patterson Irrigation District, et al. v. City of Patterson, et al. Alameda County Superior Court (Case No. 23CV028091).
On September 19, 2022, Patterson Irrigation District (“PID”), and West Stanislaus Irrigation District (“WSID”), filed a petition for writ of mandate challenging the City’s approval of the Master Plan EIR. The principally challenged the presumptions and analysis regarding the Master Plan’s effect on the water supply, specifically:
(1) The EIR failed to adequately describe the project’s increased demand on the local water supply; and
(2) The inaccurate project description caused the analysis of the Project’s hydrologic impacts to be incorrectly analyzed, rendering them moot; and (3) The EIR failed to adequately evaluate the Master Plan’s consistency with the GSP and mitigate any inconsistencies with the GSP’s groundwater sustainability mandates.
While the lawsuit was pending, the GSP was being revised in an attempt to bring the basin into compliance and avoid further state intervention. However, once the 2024 GSP was adopted, it changed the water supply circumstances applicable to the Master Plan.
Settlement Options
Following drafting of the 2024 GSP, the City and Petitioners discussed settlement provisions regarding implementation of the Master Plan consistent with the new requirements under the 2024 GSP. One key issue with the legal challenge to the sufficiency of the Master Plan EIR was that the 2024 GSP altered the presumptions underlying the EIR, notably:
· Increased potable water demand cannot be met by increased groundwater pumping from the lower aquifer because the Pumping Reduction Plan requires groundwater pumping to decrease.
· The Recharge Basin Facility will need to be constructed before water demands increase from the Master Plan in order to offset groundwater reliance and comply with the Pumping Reduction Plan.
· The EIR’s reliance on the 2019 Groundwater Sustainability Plan is irrelevant because this GSP is moot and has been replaced.
· EIR’s reliance on 2020 Water Availability Analysis is moot because GSP’ Changed circumstances could require an existing EIR to be supplemented with a Supplemental EIR (“SEIR”) that addresses those changed circumstances. However, this would delay any pending projects, including Keystone Ranch, until an SEIR could be prepared. As an alternative, the City worked with PID and WSID to agree on settlement agreement terms which obligated the City to enforce the Master Plan EIR in a way that was consistent with the 2024 GSP and which avoided additional environmental impacts beyond those addressed in the EIR.
Settlement Agreement Terms
The Settlement Agreement was executed on March 18, 2025, and includes the following terms regarding implementation of the Master Plan EIR:
· The City will require developers of the Master Plan Area to fully fund and construct the Del Puerto Creek Capture and Recharge Project (“Recharge Project”) before building permits are issued for the Master Plan Project (Settlement Agreement, hereinafter “SA,” section 4(A)(i).);
· Developers must purchase surface water deliveries for the Recharge Project to offset the increased water demands of their projects (SA section 4(A)(ii).); · The City will use best efforts to ensure completion of the Recharge Project by 2030 (consistent with the timeline for the 2024 GSP’s pumping reduction targets) (SA section 4(A)(iii).);
· The City will recharge the total amount of purchased and delivered surface water to meet increase in demand on basin from new development, including the Master Plan Project (SA section 4(A)(iv).); and
· The City will require all development projects which increase potable water demand to contribute to an evaluation of revisions to the existing storm drain system to divert the captured storm water for recharge (SA section 4(B).).
These Settlement Agreement terms allow the City to continue permitting additional development projects, while maintaining compliance with the 2024 GSP’s pumping reduction targets and implementation of the Recharge Project and the Low-Reliance on Groundwater Water Portfolio.
FISCAL IMPACT
This item is informational only and therefore there is no new fiscal impact.