Supplemental Material Item 09 2023-01185 Budgetary Adjustment and Agreement for the City-County Office of Metropolitan Water Planning (Water Forum) for the Water Forum 2.0 Project - Supplemental Material

CITY COUNCIL
Darrell Steinberg, Mayor
Lisa Kaplan, District 1
Sean Loloee, District 2
Karina Talamantes, District 3
Katie Valenzuela, District 4
Caity Maple, District 5
Eric Guerra, Vice Mayor, District 6
Rick Jennings, II, District 7
Mai Vang, Mayor Pro Tem, District 8

CHARTER OFFICERS
Mindy Cuppy, City Clerk
Susana Alcala Wood, City Attorney
Jorge Oseguera, City Auditor
Howard Chan, City Manager
John Colville, City Treasurer

City Council
Financing Authority
Housing Authority
Public Financing Authority
Redevelopment Agency
Successor Agency
915 I Street, 1st Floor, Sacramento
Published by the Office of the City Clerk
(916) 808-7200

SUPPLEMENTAL MATERIAL

Description: Attached is supplemental material received after publishing the agenda outlining revisions to attachment 2 for Consent Item 9. The attached staff report and attachments replace the original staff report in its entirety.

For the Meeting of: Tuesday, October 3, 2023, at 5:00 p.m.

Agenda Item: Consent Item 9

9. Budgetary Adjustment and Agreement for the City-County Office of Metropolitan Water Planning (Water Forum) for the Water Forum 2.0 Project

File ID: 2023-01185

Location: Citywide

Recommendation: Adopt a Resolution authorizing the City Manager or the City Manager’s designee to: 1) execute the attached cost-sharing agreement to provide funding for the Water Forum 2.0 Project for Fiscal Years (FY) 2023/24 and 2024/25 with a total not to exceed amount of $1,141,000; 2) increase the FY2023/24 operating budget for revenue by $483,929 in the City- County Office of Metropolitan Water Planning (CCOMWP) Water Forum Successor Effort (WFSE) Fund (7103); 3) increase the FY2023/24 Program Support Transfer budget from the Water Fund (6005) to the WFSE Fund (7103) by $86,571; and 4) create a Multi-Year Operating Project (MYOP) Water Forum 2.0 (I80240100) and transfer $570,500 from the WFSE Fund (7103) available fund balance to the Water Forum 2.0 MYOP (I80240100).

City of Sacramento
City Council - 5PM Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2023-01185 10/3/2023 Consent Item 9.

Budgetary Adjustment and Agreement for the City-County Office of Metropolitan Water Planning (Water Forum) for the Water Forum 2.0 Project
File ID: 2023-01185
Location: Citywide
Recommendation: Adopt a Resolution authorizing the City Manager or the City Manager’s designee to: 1) execute the attached cost-sharing agreement to provide funding for the Water Forum

2.0 Project for Fiscal Years (FY) 2023/24 and 2024/25 with a total not to exceed amount of $1,141,000; 2) increase the FY2023/24 operating budget for revenue by $483,929 in the City-County Office of Metropolitan Water Planning (CCOMWP) Water Forum Successor Effort (WFSE) Fund (7103); 3) increase the FY2023/24 Program Support Transfer budget from the Water Fund (6005) to the WFSE Fund (7103) by $86,571; and 4) create a Multi-Year Operating Project (MYOP) Water Forum 2.0 (I80240100) and transfer $570,500 from the WFSE Fund (7103) available fund balance to the Water Forum 2.0 MYOP (I80240100).

Contact: Emily Lee, Administrative Analyst, (916) 808-1988, [email protected], Water Forum; Penny Buchman, Supervising Financial Analyst, (916) 808-1481, [email protected], Department of Utilities; Jessica Law, Executive Director, (916) 808-1998, [email protected], Water Forum
Presenter: None
Attachments:
1-Description/Analysis
2-Resolution
3-Water Forum 2.0 Cost Share Agreement
Additional Description/Analysis
Issue Detail: The City-County Office of Metropolitan Water Planning (CCOWMP), also known as the Water Forum, has been working for almost 25 years with a broad range of stakeholders, including business and agricultural leaders, citizen groups, environmentalists, water managers, and local governments in the Sacramento region. Together, as the Water Forum, they work towards achieving

Page 1 of 3 ends

File ID: 2023-01185 10/3/2023 Consent Item 9.
two coequal objectives: Provide a reliable and safe water supply for the region's economic health and planned development to the year 2030; and preserve the fishery, wildlife, recreational, and aesthetic values of the Lower American River (LAR). The Water Forum members committed to achieving the coequal objectives until the year 2030 when they signed the landmark Water Forum Agreement (WFA) in 2000 that can be found on the Water Forum’s website (www.waterforum.org).

Climate change poses severe threats to the region’s water supplies and the environment of its prized asset-the lower American River and American River Parkway. These factors, along with significant new regulatory and policy frameworks (e.g., Water Conservation Act of 2009 (Senate Bill X7-7), Sustainable Groundwater Management Act 2014, Urban Water Management Plan Guidance 2020) catalyzed the Water Forum members to initiate the Water Forum 2.0 Project to explore options for a new agreement. The Water Forum and its members have been working diligently since April 2020 to review the existing agreement and have made progress in identifying areas of interest, gaps in water supply due to growth and climate change, and potential adaptation strategies.

The Water Forum 2.0 Project has been supported through existing Water Forum reserve funds for the past several years and requires supplemental funding to continue the effort. Water Forum members, with clear support and commitment to the process, identified additional funding to support the Water Forum 2.0 Project for FY2023/24 and FY2024/25. The Water Forum 2.0 agreement includes additional terms and conditions in Section VII agreed upon by all parties that outlines additional reporting requirements such as an annual business strategy, budgeting reports, work plans, and other milestones that may require approval by committees or the City Manager or City Manager’s designee.

Policy Considerations: This recommendation is consistent with the Mayor and City Council’s mission to protect, preserve, and enhance the quality of life for present and future generations. This recommendation is also necessary to meet mitigation requirements specified by the WFA Environmental Impact Report of 2000.

The WFA (C1999-222) approved in FY1999/00 includes a mechanism for a WFSE to ensure actual implementation of the Agreement for 30 years. The WFSE is being administered under the auspices of the CCOMWP. The WFSE continues the interest-based collaborative process successfully used to develop the WFA.

Economic Impacts: None.

Environmental Considerations: Continuing administrative activities and government fiscal activities do not constitute a project and are therefore exempt from California Environmental Quality Act (CEQA) review [CEQA Guidelines § 15378(b)(2) and (b)(4)].

Sustainability: Approval of the Water Forum 2.0 Cost Share Agreement for the Water Forum is

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File ID: 2023-01185 10/3/2023 Consent Item 9.
consistent with the following City of Sacramento’s General Plan Goals.

Environmental Resource Goal 1.1 - Water Quality Protection is supported by the first coequal objective of the Water Forum Agreement “To provide a reliable water supply for planned development to the year 2030.”
Environmental Resource Goal 1.1.1.- Conservation of Open Space Areas is promoted by the second coequal objective of the Water Forum Agreement “To preserve the fishery, wildlife, recreational, and aesthetic values of the lower American River.” Sustainability Goal No. 7 - Parks, Open Space, and Habitat Conservation is promoted by the second coequal objective of the Water Forum Agreement “To preserve the fishery, wildlife, recreational, and aesthetic values of the lower American River.” Sustainability Goal No. 8 - Water Resources is supported by the first coequal objective of the Water Forum Agreement “To provide a reliable water supply for planned development to the year 2030.”
Commission/Committee Action: In April 2020, the Water Forum stakeholders initiated a review and renegotiation of the original Water Forum Agreement, through a process identified as Water Forum

2.0. The proposed Water Forum 2.0 Cost Share Agreement has been reviewed and accepted by the Water Forum Coordinating Committee and the Water Forum Plenary in June 2023.

Rationale for Recommendation: Approval of the Water Forum 2.0 Cost Share Agreement will enable the Water Forum to continue its services and projects.

Financial Considerations: This program is primarily supported through the Cost Share Agreement.

The total City cost is $86,571 and is funded by the Water Fund (6005). Staff is recommending a FY2023/24 budget augmentation increasing revenues by $483,929 in the WFSE Fund (7103) and to increase the FY2023/24 expense budget for the program support transfer from the City’s Water Fund (6005) to the WFSE Fund (7103) by $86,571.

Staff is also recommending to create a Multi-Year Operating Project (MYOP) Water Forum 2.0 (I80240100) to support the new program and a budget transfer of $570,500 from the WFSE Fund (7103) available fund balance to the new Water Forum 2.0 MYOP (I80240100).

There are no General Funds allocated or planned for this project.

Local Business Enterprise (LBE): Not Applicable.

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RESOLUTION NO. 2023 – 01185
A
dopted by the Sacramento City Council
S
eptember 26, 2023
B
udgetary Adjustment and Agreement for the City-County Office of Metropolitan Water Planning (Water Forum) for the Water Forum 2.0 Project BACKG
ROUND
A. The City County Office of Metropolitan Water Planning (CCOWMP), also known as the Water Forum, has been working for almost 25 years with a broad range of stakeholders, including business and agricultural leaders, citizen groups, environmentalists, water managers, and local governments in the Sacramento region. Together, as the Water Forum, they work towards achieving two coequal objectives: Provide a reliable and safe water supply for the region's economic health and planned development to the year 2030; and preserve the fishery, wildlife, recreational, and aesthetic values of the Lower American River (LAR). The Water Forum members committed to achieving the coequal objectives until the year 2030 when they signed the landmark Water Forum Agreement (WFA) in 2000 that can be found on the Water Forum’s website (www.waterforum.org).

B. C
limate change poses severe threats to our water supplies and the environment of our prized asset—the lower American River and American River Parkway. These factors, along with significant new regulatory and policy frameworks (e.g., Water Conservation Act of 2009 (Senate Bill X7-7), Sustainable Groundwater Management Act 2014, Urban Water Management Plan Guidance 2020) catalyzed the Water Forum members to initiate the Water Forum 2.0 Project to explore options for a new agreement. The Water Forum and its members have been working diligently since April 2020 to review the existing agreement and have made progress in identifying areas of interest, gaps in water supply due to growth and climate change, and potential adaptation strategies.

C. T
he Water Forum 2.0 Project has been supported through existing Water Forum reserve funds for the past several years and requires supplemental funding to continue the effort. Water Forum members, with clear support and commitment to the process, identified additional funding to support the Water Forum 2.0 Project for FY2023/24 and FY2024/25. The Water Forum 2.0 agreement includes additional terms and conditions in Section VII agreed upon by all parties that outlines additional reporting requirements such as an annual business strategy, budgeting reports, work plans, and other milestones that may require approval by committees or the City Manager or City Manager’s designee.

D. A budget augmentation is necessary to support the additional revenue and program support transfer for Water Forum 2.0 in the FY2023/24 operating budget for the WFSE Fund (7103) and the program support transfer from the Water Fund (6005).

E. A
new Multi -Year Operating Projects (MYOP) and expense budget is necessary to support Water Forum 2.0 program.

BAS

ED ON THE FACTS SET FORTH IN THE BACKGROUND, THE CITY COUNCIL RESOLVES AS FOLLOWS:

S
ection 1.

T
he City Manager or City Manager’s designee is authorized to:

A. S
ign the Water Forum 2.0 Cost Share Agreement between the City of Sacramento and Water Forum 2.0 Agencies.

B. I
ncrease the revenue budget in the FY2023/24 WFSE Fund (7103) for an amount not-to-exceed $483,929.

C. I
ncrease the City’s FY2023/24 program support transfer budget from the Water Fund (6005) to the WFSE Fund (7103) in the amount of $86,571 for the City’s Water Forum 2.0 Cost Share portion.

D. C
reate and establish a Multi-Year Operating Project for the Water Forum 2.0 Project (I80240100) and fund the MYOP with a transfer of $570,500 from the WFSE Fund (7103).

Interagency Agreement
For Cost-Sharing the Fiscal Year (FY) 2023-24 and FY 2024-25 Water Forum 2.0 Agreement for the City of Sacramento, on behalf of the Sacramento City-County Office of Metropolitan Water Planning T
HIS AGREEMENT is made and entered into on July 1, 2023, by the City of Sacramento (on behalf of the Sacramento City-County Office of Metropolitan Water Planning (CCOWMP), as known as the “Water Forum”); and among the agencies listed below in Table 2 and Table 3.

T
able 1 provides the total potential contribution to the Water Forum 2.0 Project from funding sources outside of the Water Forum’s annual operating budget. The costs have been distributed by the partners based on a negotiated amount. Several parties, as noted, are providing funding as shown in Table 2 for FY 23-24 and FY 24-25; and for FY 23-24 only as shown in Table 3. In addition, several agencies are listed in Table 1 that are not party to this agreement, but that are contributing to the Water Forum 2.0 Project and are covered under separate agreements (Section III). Please see Attachment 1 for information on the Water Forum 2.0 Project scope and budget.

Table 1. Water Forum 2.0 Project Contributions By Agency Per Fiscal Year Agency Amount
FY 23-24 FY 24-25 Total
California-American Water Company $58,100 $58,100 $116,200 Carmichael Water District $16,530 $16,530 $33,060
Citrus Heights Water District2 $28,629 $28,629 $57,258
City of Folsom $32,124 $32,124 $64,248
City of Folsom (Ashland) 2 $1,455 $1,455 $2,910
City of Roseville $52,208 $52,208 $104,415
City of Sacramento, Department of Utilities $86,571 $86,571 $173,141 Del Paso Manor Water District $2,441 $2,441 $4,881
East Bay Municipal District (EBMUD) 1 $12,000 $12,000 $24,000 El Dorado County Water Agency (EDCWA) $5,705 $5,705 $11,410 El Dorado Irrigation District $50,506 $50,506 $101,013
Fair Oaks Water District2 $20,289 $20,289 $40,578
Golden State Water Company $24,217 $24,217 $48,434
Orange Vale Water Company2 $6,124 $6,124 $12,248
Placer County Water Agency $16,324 $16,324 $32,649
Sacramento Area Flood Control District (SAFCA) 1 $20,000 $20,000 $40,000 Sacramento County Water Agency $58,333 $58,333 $116,666 Sacramento Municipal Utilities District (SMUD) $12,000 $12,000 $24,000 Sacramento Suburban Water District $51,699 $51,699 $103,398 San Juan Water District (in Sacramento County) 2 $15,246 $15,246 $30,491 Total $570,500 $570,500 $1,141,000
1EBMUD and SAFCA are not parties to this agreement. Funding will be provided under a separate agreement.

Please see Section III for additional information.
2The parties have committed to fund the Water Forum 2.0 Project for FY 23-24 only and will consider FY 24-25 funding in June 2024 consistent with Table 1.

Section I.

Funding Commitment: The following parties h ave committed to fund the Water Forum 2.0 Project for FY 23-24 and FY 24-25 (Table 2).

Table 2. Water Forum 2.0 Project Contributions for FY 23-25 Agency Amount
FY 23-24 FY 24-25 Total
California-American Water Company $58,100 $58,100 $116,200 Carmichael Water District $16,530 $16,530 $33,060
City of Folsom $32,124 $32,124 $64,248
City of Roseville $52,208 $52,208 $104,415
City of Sacramento, Department of Utilities $86,571 $86,571 $173,141 Del Paso Manor Water District $2,441 $2,441 $4,881
El Dorado County Water Agency (EDCWA) $5,705 $5,705 $11,410 El Dorado Irrigation District $50,506 $50,506 $101,013
Golden State Water Company $24,217 $24,217 $48,434
Placer County Water Agency $16,324 $16,324 $32,649
Sacramento County Water Agency $58,333 $58,333 $116,666 Sacramento Municipal Utilities District (SMUD) $12,000 $12,000 $24,000 Sacramento Suburban Water District $51,699 $51,699 $103,398 Total $466,758 $466,758 $933,516
T
he following parties have committed to fund the Water Forum 2.0 Project for FY 23-24 only (Table 3) and will consider FY 24-25 funding in June 2024, consistent with Table 1.

Table 3. Water Forum 2.0 Project Contributions for FY 23-24 only Agency Amount
FY 23-24
San Juan Water District Consortium1
City of Folsom (Ashland) $1,455
Citrus Heights Water District $28,629
Fair Oaks Water District $20,289
Orange Vale Water Company $6,124
San Juan Water District (in Sacramento County) $15,246
Total $71,743
1San Juan Water District Consortium includes San Juan Water District, Citrus Heights Water District, Fair Oaks Water District, and Orange Vale Water Company, and the City of Folsom (Ashland).

Section II.

Reimbursement: The City of Sacramento, on behalf of the CCOWMP, shall administer all consultant agreements and other expenses incurred during FY23-24 and FY 24-25 for the Water Forum 2.0 Project.

The parties agree to reimburse the CCOMWP for their share of such costs, up to the amount set forth for each party in Section I, above, within 30 days after receipt of invoices.

The City of Sacramento Finance Department, on behalf of the CCOMWP, will invoice each cost-sharing partner at the beginning of each fiscal year, except in those instances where the cost-sharing partners have mutually agreed to be invoiced in another time period (i.e., quarterly invoices). It is understood and agreed that although this agreement only pertains to reimbursement for costs incurred during the period from July 1, 2023 to June 30, 2025, the Water Forum 2.0 Project could extend past June 30, 2025.

Any reimbursement of costs incurred by CCOMWP after June 30, 2025 would be governed by a new or amended cost-sharing agreement.

Section III.

Separate Agreements: Sacramento Area Flood Control Agency (SAFCA) and East Bay Municipal District (EBMUD) are not parties to this agreement and have entered into separate agreements with the City of Sacramento, on behalf of the CCOMWP, to pay their share of the costs identified in Table 1.

Section IV.

Changes in Terms: Any changes in the terms of this agreement shall be approved by all parties and shall be effective when reduced to writing and signed by all parties.

Section V.

Indemnity: Each party shall, to the fullest extent allowed by law, indemnify, hold harmless and defend the other party or parties, its officers and employees from any actions, liability or other expenses (including reasonable attorney fees) for any damages or injury to persons or property, occurring by reason of any negligent or wrongful act or omission by the indemnifying party, its officers or employees under this agreement.

Section VI.

Independent Contractors: All contractors employed during any phase of the Water Forum 2.0 Project are independent contractors. Contractor employees assigned to perform contract work related to the Water Forum 2.0 Project are and will remain employees of the contractor and will not be considered employees of any of the signatory agencies for any reason.

Section VII.

Additional Terms and Conditions: The following additional terms and conditions were agreed to by the parties to be incorporated into this funding agreement specifically for the Water Forum 2.0 Project:

1. Water Forum annual priorities, as described in the Water Forum Business Strategy (approved July 2022) will continue to include the Water Forum 2.0 Project as a top priority for the FY 23-24 and FY 24-25. Annual progress on the Business Strategy is reviewed by the Coordinating Committee and approved by the Water Forum Plenary each year by September 1st.

2. The Coordinating Committee includes two members of each caucus and meets with the Executive Director on a monthly basis to provide direction on Water Forum Successor Effort operations, including communications and implementation of the business strategy; and to approve the annual budget and work plan. In addition, the Coordinating Committee, and the City of Sacramento City

Manager or designee, will provide project oversight and approve an annual scope of work for the Water Forum 2.0 Project, which includes schedule and budget, that supports the established priorities will be submitted to the Coordinating Committee. The budget will also include look-ahead estimates for the second year.

3. The Water Forum 2.0 Project annual scope of work must be approved by the Coordinating Committee and the City of Sacramento City Manager, or designee, ahead of preparing the next fiscal year budget by March 1st each year.

4. The Coordinating Committee shall review the progress on the approved work at its regular meetings.

5. Any out-of-scope requests or technical studies are to be approved by the Coordinating Committee prior to commencement of any work and subject to adequate funding within the current budget.

6. A mid-year progress report on or before January 1st each year covering work completed and work not completed, and budget status are to be presented to the Coordinating Committee and the City Manager, or designee. Both will be presented alongside the approved annual schedule and budget.

7. If progress is not on track with annual expectations at the mid-year report, a plan for correction is to be submitted to the Coordinating Committee and the City Manager, or designee, for approval.

Work may be suspended if progress is severely off-track.

8. Subsequent year funding is subject to effective progress of the previous year and agreed upon annual priorities and scope of work for the coming year.

Section VIII.

Single Agreement: This agreement may be signed in multiple counterparts, which together will constitute a single agreement.

This agreement is executed as follows:

CALIFORNIA AMERICAN WATER COMPANY