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County Water Authority Proposes Sweeping Legal Settlement with Metropolitan Water District

San Diego County water officials, who have been mired in legal disputes with their counterparts to the north over billions of dollars in rates and methodology, proposed a sweeping compromise Thursday that, if accepted, could end years of acrimony and expensive litigation.

San Diego County Water Authority Board Chair Jim Madaffer today sent a letter to the Metropolitan Water District of Southern California’s Board of Directors, settiing the stage for an equitable resolution of long-running rate cases. Photo: FourSquare/Creative Commons Madaffer's letter

Water Authority Board Chair Outlines Compromise Terms to Potentially End MWD Litigation

San Diego County Water Authority Board Chair Jim Madaffer today sent a letter to the Metropolitan Water District of Southern California’s Board of Directors that lays out a potential compromise approach by both parties designed to end nearly a decade of litigation over MWD’s rates.

The letter includes specific, practical terms that respect both the Water Authority’s and MWD’s perspectives towards an equitable conclusion in coming weeks.

“Concluding all pending court cases is in the best interest of everyone involved, and it would allow us to begin a new era of collaboration on other important regional and state issues,” said Madaffer, who started his tenure as chair on Oct. 1. “I hope MWD will embrace this gesture of good faith to seek settlement, and that we can do so in an expeditious and fair manner.”

Madaffer’s letter builds on the commitment of his predecessor, prior Water Authority Board Chair Mark Muir, to seek an end to lawsuits that started in 2010 and involve billions of dollars of contested rates and charges.

The Water Authority won several significant items in two cases covering MWD’s rates for 2011-2014, including additional rights to approximately 100,000 acre-feet a year of MWD water, invalidation of an illegal contract clause that MWD used to deny support for local supply development projects, and damages and interest on tens of millions of dollars of unlawful Water Stewardship Rate charges by MWD. The courts allowed MWD to continue charging historic State Water Project costs in water transportation rates charged to the Water Authority.

Key terms outlined in Madaffer’s letter include:

  • Neither party should be expected to give up anything it won in court.
  • MWD would change the way it charges for delivering the Water Authority’s independent supplies from the Colorado River by adopting a fixed price and tying future price increases to an inflation index each January 1.
  • The Water Authority would drop pending claims challenging the legality of MWD’s Water Stewardship Rates that MWD charges on the purchase of MWD water supplies.
  • The Water Authority would accept $5 million in attorneys’ fees and costs, a substantial reduction from the $8.9 million the trial court awarded to the Water Authority.
  • MWD’s Board would approve a pending agreement to provide through its Local Resource Program funding for the Carlsbad Desalination Project, the City of San Diego’s Pure Water Project, the Padre Dam-East County Advanced Water Purification Project and other pending local supply project agreements.
  • The Water Authority would be granted a sub-account in MWD’s Colorado River Lake Mead Storage Project to store 200,000 acre-feet of eligible Water Authority supplies in Lake Mead, which would benefit both MWD and the Colorado Basin states.

The complete letter is posted here.

Background

 More than 20 years ago, the Water Authority and its member agencies began improving the San Diego region’s water supply reliability by lessening reliance on MWD, which at the time supplied about 95 percent of all the water used in San Diego County.

The cornerstone of that diversification strategy is a set of agreements known collectively as the Colorado River Quantification Settlement Agreement, which was signed in 2003 to secure independent water supplies for the Water Authority from the Colorado River. To deliver these supplies to San Diego County, the Water Authority must use pipelines operated by MWD because MWD owns the only large-scale conveyance facilities in Southern California for transporting water.

The Water Authority filed suit in 2010 seeking to invalidate MWD’s rates, and then filed additional suits in 2012, 2014, 2016 and 2018 because MWD kept adopting rates using the same methodology and flawed cost allocations. A series of court decisions have been issued in the 2010 and 2012 cases. The other cases have been stayed in Superior Court during the appellate process on the initial two lawsuits.

Additional information is available on the Water Authority website.

READ MORE:

San Diego Union Tribune: County water authority proposes sweeping legal settlement with Metropolitan Water District

Times of San Diego: Water Authority Offers to End Decade-Old Rate Dispute with Los Angeles

Water Authority, NASSCO & EDC Celebrate Manufacturing Day

General Dynamics NASSCO – one of the San Diego region’s largest employers – hosted Water Authority Board Chair Jim Madaffer and Jesse Gipe,  senior economic development manager for the San Diego Regional Economic Development Corp.,  for national Manufacturing Day on Oct. 5 as part of a partnership to promote the importance of a safe and reliable water supply to sustain the local economy.  The partnership was forged during the Water Authority’s Brought to You by Water outreach and education program, which includes stakeholders from key industry sectors such as tourism, manufacturing, brewing and agriculture.

See video of Madaffer’s onsite tour here.

 

Water Authority Board Chair Jim Madaffer provided the keynote address at the 2018 North County Water Symposium. Photo: Water Authority

North County Water Symposium Highlights Efforts to Ensure Reliability

Escondido — The 2018 North County Water Symposium on Wednesday highlighted efforts by the San Diego County Water Authority to ensure regional water reliability for a crowd of about 100 North County business and industry leaders.

Keynote speaker Jim Madaffer, the Water Authority’s newly elected board Chair, reviewed the Water Authority’s historic achievements in water supply diversification. He also discussed continued regional development of water recycling capacity and investments in technology to maintain billions of dollars worth of water infrastructure.

“As the Water Authority approaches our 75th year,” said Madaffer, “we are doing everything we can …  to make sure that we have a resilient water supply for the region.”

The symposium was organized by the San Diego North Economic Development Council. It featured a panel discussion on water supply and reliability for San Diego North County, with a focus on agriculture and housing. Panelists were Greg Thomas, general manager of Rincon del Diablo Municipal Water District; Cari Dale, water utilities director for the City of Oceanside; Eric Larson, executive director of the San Diego County Farm Bureau; and Michael McSweeney, senior public policy advisor for the San Diego Building Industry Association.

Larson highlighted efforts by farmers to increase water-use efficiency and advance recycled water use to support their multi-billion dollar industry. McSweeney said the building industry improves water efficiency when it replaces decades-old homes with new homes that use less water and less energy thanks to modern technologies.

Larson and Thomas say their respective industries share a similar challenge. Larson said fewer young adults today choose farming careers. Thomas expressed the same concerns about the water industry. “There is so much emphasis among high school students on going to college, we aren’t training enough water technology employees” to replace a “silver tsunami” of retiring Baby Boomers, he said.

Madaffer and the panelists agreed that continued dialogue and coordinated efforts among the North County region’s leaders across all economic sectors can drive economic growth while ensuring water efficiency and reliability.

The San Diego County Water Authority presented its inaugural Water Innovation & Efficiency Award to Kyocera. Photo: Water Authority

Kyocera First Recipient of New Water Authority Award

In an effort to remind regional stakeholders in the business community about the importance of water to San Diego’s regional economy, the San Diego County Water Authority presented its inaugural ‘Water Innovation & Efficiency Award’ to Kyocera International during the Industrial Environmental Association’s 34th annual conference at the San Diego Convention Center on September 28.

Kyocera was honored for its strong commitment to reusing water multiple in its production processes, thereby decreasing its water use by nearly 20 percent since 2014. This conserves more than 6 million gallons per year.

“Water is our most precious natural resource, and it’s so rewarding to see major employers like Kyocera redouble their efforts to use – and re-use – water efficiently,” said Jim Madaffer, whose term as chair of the Water Authority’s Board of Directors starts Oct. 1. “Corporate leadership like this, coupled with investments in water supply reliability, will help sustain our thriving economy and unparalleled quality of life.”

Madaffer presented the award to Kyocera in front of about 250 people at the conference. “There are a lot of folks in the industrial community here in San Diego,” he said. “By Kyocera’s example, we’re hoping that other companies follow their lead, being able to do what they can to save water for all of our region as well.”

Kyocera’s Meridith Marquis, Roger Blankenship and Mark Brodie accepted the award on behalf of the company.“Kyocera’s corporate motto is ‘Respect the Divine and Love People,’ which compels us to manufacture in resource-saving, eco-friendly ways,” said Marquis, divisional vice president for general affairs. “It takes a lot of water to manufacture the technology that surrounds us, and we must act in good conscience to recycle as much of that water as possible. The fact that we can save money while doing this makes it a win-win all around.”

View the award presentation video here.

Kyocera’s innovative efforts pay off

Headquartered in San Diego, Kyocera’s North American operations were established in 1971. Today, the company employs about 625 people locally and manufactures high-tech products such as ceramic semiconductor packages and microelectronic devices at its San Diego plant.

Kyocera has been investing in water-use efficiency at its local plant since 2000, with a marked increase in savings since 2014. Recent water savings result from:

  • Converting to a closed-loop cooling system that uses water multiple times instead of once
  • Re-using water from plating operations to cool its onsite co-generation plant
  • Installing water meters for production groups and making them accountable for water use
  • Adding flow regulators to fine-tune the amount of water delivered for manufacturing processes
  • Replenishing plating tanks only when necessary instead of continuously

Kyocera achieved significant water savings by installing a basic, off-the-shelf $30 valve allowing the company to repurpose reverse osmosis water that didn’t meet purity standards, and instead use it as cooling water. This single creative adjustment alone saved about 373,000 gallons per month. In all, Kyocera is saving about $62,500 a year in water costs compared to 2014, while upholding its corporate mission to embrace sustainability.

The Water Innovation & Efficiency Award is part of the Water Authority’s Brought to You by Water outreach and education program, designed to enhance the regional appreciation for the value of the safe and reliable water supplies. That effort includes enhanced partnerships to highlight the importance of water reliability to the region’s economy for tourism, agriculture, brewing, manufacturing and other key sectors.

This fall, the Water Authority is focusing on manufacturing companies with “products that put San Diego on the map.” For more information, go to the Brought To You By Water website.

 

San Diego County Water Authority Logo Stacked Tagline

Water Authority Presents Kyocera With 2018 Water Innovation & Efficiency Award

San Diego, Calif. – The San Diego County Water Authority this morning presented its 2018 Water Innovation & Efficiency Award to Kyocera for reducing its annual water use by more than 6 million gallons at its San Diego facility, a decrease of nearly 20 percent since 2014.

The award marks the Water Authority’s inaugural effort to recognize water-efficiency investments among the region’s top manufacturing companies in conjunction with the Industrial Environmental Association. The 2018 Water Innovation & Efficiency Award was announced at the IEA’s 34th Annual Environmental Conference at the San Diego Convention Center.

Jim Madaffer Elected as Board Chair of Water Authority

San Diego, Calif. – New officers for the San Diego County Water Authority’s Board of Directors were unanimously elected today, with Jim Madaffer starting his two-year term as Board chair on Oct. 1.

Madaffer, vice chair of the Board for the past two years as a representative from the City of San Diego, will serve with incoming Vice Chair Gary Croucher, a Board representative from the Otay Water District, and incoming Secretary Christy Guerin from the Olivenhain Municipal Water District.