FISCAL YEAR 2023 - 24
SCVWD Groundwater Production & Other
Water Charges
For City of Sunnyvale
May 2, 2023
52nd Annual Report Released
Annual Protection and Augmentation of
Water Supplies Report provides
information & accountability
Filed February 24, 2023
Available Online:
https://www.valleywater.org/ProposedWaterCharges
A comprehensive, flexible water system
SERVING OVER 2.0 MILLION PEOPLE
10 Reservoirs
393 acres of recharge ponds
142 miles of pipelines
3 water treatment plants
1 water purification center
3 pump stations
Groundwater Benefit Zones
North County South County
• Groundwater
charges are levied
within a zone for
benefits received
• Treated water
charges are set
equivalent to the
groundwater charge
plus a treated water
surcharge
• Helps Valley Water
manage water
conjunctively to
prevent over use
or under use of
the groundwater
basin
202kAF 207kAF
222kAF
285kAF
237kAF
200kAF
215kAF
233kAF
216kAF
231kAF
247kAF
221kAF
192kAF
234kAF 235kAF 238kAF 239kAF 240kAF 241kAF 243kAF 245kAF 246kAF 247kAF 0 50
100
150
200
250
300
350
FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 FY 20 FY 21 FY 22 FY 23 FY 24 FY 25 FY 26 FY 27 FY 28 FY 29 FY 30 FY 31 FY 32 FY 33 Acre-feet (1,000s)
Water Usage (District Managed)
Actuals FY 23 Budget Prior Projection Current Drought Projection Treated Water
Historic Drought
Wet Spring Current Drought
Water Usage (District Managed)
Drought Drives Near-Term Water Rates
Key drivers of near-term rate projection (FY 24 and FY 25) Drought Puts Pressure on Water Rates:
O&M Costs up
• Emergency Water Purchases projected to be
$24.5M in FY24 & FY25
• Emergency Conservation activities projected to be
$7.0M in FY24 & FY25
Water Usage down: Mandatory 15% call for conservation compared to 2019 (on track to achieve in FY23) • Results in lower revenue to pay for highly fixed cost structure Continued Measures to Soften Water Rate Impact:
• Draw down Rate Stabilization reserves in FY 24 & FY 25 • Suspension of certain position backfills, sharing certain positions between multiple divisions, careful scrutiny of draft biennial budget to offset inflation impact O&M
COSTS
WATER
USAGE
WATER
RATES
Reduced
$26M
in FY24
Infrastructure Repair and Water Supply Investments
Drive Medium-Term and Long-Term Water Rates
RWTP Reliability Improvements
($628 Million)
Purified Water Program
($1,210 Million)
Dam Seismic Retrofits/Improvements
($1,771 Million)
Pacheco Reservoir Expansion
($2,780 Million)
• Project costs
shown include
impact of recent
inflation trends
• Rising interest
rates mean more
costly debt
issuances
FY 2023-24 Recommended Groundwater Charge Projection
M&I Groundwater Charge Year to Year Growth %
FY24 FY25 FY26 FY27 FY28 FY29 FY30 FY31 FY32 FY33
North County Zone W-2 14.5%
15%
14.5%
15% 9.9% 9.9% 9.9% 9.9% 9.9% 6.8%
6.3%
6.8%
6.3%
6.8%
6.3%
Prior Year 15% 15% 9.1% 9.1% 9.1% 9.1% 9.1% 5.0% 5.0%
Reflects Staff Proposed Revisions
M&I Groundwater Charge Monthly Impact to Average Household Staff Recommendation FY24 FY25 FY26 FY27 FY28 FY29 FY30 FY31 FY32 FY33 North County Zone W-2 $8.61
$8.92
$9.86
$10.24
$7.71
$7.77
$8.47
$8.54
$9.31
$9.39
$10.23
$10.32
$11.24
$11.34
$8.49
$8.18
$9.06
$8.72
$9.68
$9.28
Reflects Staff Proposed Revisions
Note: Does not include any increase that a retailer would layer on top FY 2023-24 North County Zone W-2 Maximum Proposed Charges * The total surface water charge is the sum of the
basic user charge (which equals the groundwater
production charge) plus the water master charge
** The total treated water contract charge is the
sum of the basic user charge (which equals the
groundwater production charge) plus the contract
surcharge
*** The total treated water non-contract charge is
the sum of the basic user charge (which equals the
groundwater production charge) plus the non-
contract surcharge
Zone W-2 (North County)
Dollars Per Acre Foot
FY 2021–22 FY 2022–23
Proposed
Maximum
FY 2023–24
Basic User/Groundwater Production Charge
Municipal & Industrial 1,499.00 1,724.00 1,983.00
Agricultural 34.15 36.85 39.80
Surface Water Charge
Surface Water Master Charge 40.90 47.10 54.20
Total Surface Water, Municipal & Industrial* 1,539.90 1,771.10 2,037.20 Total Surface Water, Agricultural* 75.05 83.95 94.00
Treated Water Charges
Contract Surcharge 115.00 115.00 115.00
Total Treated Water Contract Charge** 1,614.00 1,839.00 2,098.00 Non-Contract Surcharge 200.00 200.00 200.00
Total Treated Water Non-Contract Charge*** 1,699.00 1,924.00 2,183.00 M&I Increase approximately $8.61 per month increase to the average household user.
Note: Does not include any increase that a retailer would layer on top Reflects
Staff
Proposed
Revisions
$1,974
$54.00
$2,037
$93.80
$2,089
$2,174
2023 Schedule
Jan 9 Ag Water Advisory Committee
Jan 10 Board Meeting: Preliminary Groundwater Charge Analysis Jan 18 Water Retailers Meeting: Preliminary Groundwater Charge Analysis Jan 23 Water Commission Meeting: Preliminary Groundwater Charge Analysis Feb 7 Board Meeting: Set time & place of Public Hearing Feb 24 Mail notice of public hearing and file PAWS report Mar 7 Board Meeting: Budget development update
Mar 15 Water Retailers Meeting: FY 24 Groundwater Charge Recommendation Apr 3 Ag Water Advisory Committee
Apr 11 Open Public Hearing
Apr 12 Water Commission Meeting
Apr 13 Continue Public Hearing in South County
Apr 25 Conclude Public Hearing
Apr 26 Board Meeting: Budget work study session
May 16 Adopt budget & groundwater production and other water charges Summary
Key Drivers for Near-Term Water Rate Increases:
• Recovery from current historic drought (reduced water usage due to necessary conservation) Key Drivers for Medium-Term & Long-Term Water Rate Increases:
• Smart infrastructure investments: Rinconada Water Treatment Plant, Purified Water Program, Anderson Dam Seismic Retrofit & Pacheco Reservoir Expansion Project
• Investing now remains the most cost-efficient way to get critical multi-year projects done Proposed Maximum FY 24 Groundwater Production Charge for North County in terms of average household increase are:
• Increase of $8.61 per month in Zone W-2 for groundwater and treated water