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Trickle down water regs push Fresno into regional utility

Fresno has a bright future when it comes to water. That means Fresno has a water future full of challenges and, most likely, frustration.

Those of us who are Valley natives of an advanced age and enjoy obsessing over rainfall totals already knew that. Events of the past two months at City Hall confirm this paradox.

There was the Dec. 8 City Council meeting at which the lawmakers postponed a decision on creation of new water capacity fees for developers. The issue could return to the council chamber next month.

There was the Dec. 15 council meeting at which a revised contract between City Hall and the Fresno Irrigation District was approved. The deal outlines terms of a new alliance between two regional water players.

And on Jan. 3 there was the inauguration of Lee Brand as mayor.

What’s it all mean? The council and new mayor so far have shown little inclination to enlighten me or their fellow Fresnans.

But I’ll make a two-part guess: 1.) The administrative state will use water regulation to gain even more control over Valley life; 2.) The city of Fresno’s Water Division is transitioning into a piece of a regional utilities district.

I wrote separate pieces last week about the FID contract and the water capacity fees. I conclude this impromptu series with comments from local government officials on these issues.

Slowly but surely we’ll get these officials to clarify things for us.

I begin with Brand’s official swearing-in ceremony on Jan. 3. Brand held a quick news conference after taking the oath from City Clerk Yvonne Spence.

David Taub, reporter for GVWire, asked: “How would you advise the City Council to handle the impending water fees for developers?”

Brand answered: “That is to be determined. The water fees and the water situation in general are being driven by the state of California. The Sustainable Groundwater Management Act is going to govern that. As you know, we recently passed a very important deal with FID, making arrangements to carry water for the city of Fresno, something that was done for 30 or 40 years on a month-to-month basis. We now have a contract.

“So, there are a lot of big things (happening). What we did as a city over the past two years in terms of building a southeast surface water treatment plant, the water infrastructure – a half-a-billion-dollar program – and water reclamation are going to put Fresno in the forefront of water. Fresno is probably the best-positioned city in California for water in the future. The new rules are very onerous. It is going to be very difficult for certain cities to manage” under those new rules.

My takeaway: GVWire is part of the Granville Homes/Assemi family empire. Granville President Darius Assemi takes considerable interest in what it means for a city to be in the “forefront of water” while the state hands down “very onerous” water rules. All developers no doubt share Assemi’s interest.

The City Council on Dec. 15 spent a grand total of 13 minutes on the new deal with FID. Some of those 780 seconds were spent on the idea of turning ponding basins into dog parks.

Georgeanne White, Public Utilities’ assistant director, briefly reviewed the deal points. At one point she described the original deal, in place since 1976, as “the disagreement which is commonly known as the FID conveyance agreement…”

I listened to the videotape a half-dozen times. White said “disagreement.” She added that coming up with a new deal required “a tremendous amount of effort.” But Fresnans never learned why the two sides were so far apart in the beginning.

Gary Serrato, FID’s general manager, went to the public microphone.

“It’s going to be a wet year,” Serrato said. “We’ll continue to pray for rain.”

Next to the microphone was Granville Vice President Jeff Roberts.

“This topic is of vital interest to this city and to our community,” Roberts said. “I know we’ve been operating on a year-to-year basis for close to 40 years. This is really a big step forward that I hope, and we hope, that you take. We’ve got a vital interest in this issue. We’ve got three large properties within the city of Fresno that are currently not developed. One of those is in Northeast Fresno, one is in West Fresno, one is in Southwest Fresno. So, we’re very supportive of a long-term agreement that will provide for future water deliveries, reliable water deliveries, to the entire city.”

Council Member Steve Brandau asked Serrato to return to the microphone.

“Would you categorize (FID deal) as a win-win?” Brandau asked.

Serrato: “Absolutely. I think it gives enough flexibility for the two agencies to work together. If you take a look at water supply and our tributaries, they’re pretty much allocated. I see water supply in the future as being opportunistic water supply. That’s water supply when there are flood releases that are occurring either on the CVP side, Friant, or on the Kings River side. And we have to be in place to be able to take advantage of any water supply that comes to us, to capture or recharge or deliver to the surface water treatment plants. And I think that flexibility is going to allow for the cities to be vibrant and farmers to continue to farm.”

Brandau: “Does it lay the groundwork for agreements with our other local entities?

Serrato: “Absolutely. This is going to be the model as we move forward. The things being incorporated into this agreement are going to be the very same things that are going to be incorporated into other agreements. And we have other cities within the district. We have Clovis and we have Kerman, and we have small water agencies, as well. I think this document here really lays the groundwork as we move forward. And a lot of what you see in here is being incorporated into the other agreements.”

Brandau: “Somebody coming up behind is not going to get a better than us, are they?

Serrato: “No, absolutely not. We’re looking to hold everyone at the same bar that we held the city of Fresno.”

Brandau: “It sounds like a fantastic agreement.”

Public Utilities Directory Tommy Esqueda and City Hall Communications Director Mark Standriff kindly spent a half-hour with me on Jan. 11. We talked about water issues.

What, I asked, is a water capacity fee?

Esqueda: “Our water system, in general, is changing dramatically. The biggest change is that once we get the water (treatment) plants in line – the new water plant up and running and all of the finished water transmission lines running – we will have the ability to move water from the east side of the city to the west side, the north side of the city to the south side. So, it’s really a system.

“That is different than what we’ve got now. What we’ve got now is a system where – you’ve got a quarter section, you’re going to build a subdivision, you’ve got to dig wells to serve that. And that water is pretty much going to stay within that little bitty area because that well can’t pump water all the way to west side or the east side – it just kind of pumps for that area.”

When it came to past water policy, Esqueda said, City Hall treated those residential subdivisions and their water wells as separate entities. Fresno was a patchwork of poorly-coordinated water consumers. But all that water came from a single source – the aquifer. The Sustainable Groundwater Management Act of 2014 forced Fresno to view water policy in a new light.

“Now with the SGMA, the city has got to comply with this overdraft law,” Esqueda said. “And now that we’ve got the ability to move water north, south, east, west (thanks to Recharge Fresno’s $429 million system upgrade), we need to build a capacity fee that allows us to make new connections to the system, and that those new connections we make to the system have an appropriate cost allocated to them to keep the system in balance. Because prior to that it was: ‘Build a subdivision, drill a well and you’re good.’ We’re going to have an integrated system.”

There are two key terms to the future of water in Fresno – balance and system. You can’t use water you don’t have. You can’t use water if you can’t get it to the faucet.

Of course, Valley pioneers were keenly aware of the same two concepts. But Valley pioneers taking their produce to market in Fresno weren’t greeted by a metropolitan area with 700,000 people.

What will the water capacity fees buy?

Esqueda said the upgraded water system when finished will be perfect for a city of a half-million people. But the city will continue to grow.

In light of that expected growth, Esqueda said, “We’ve got to go to our building friends: ‘OK, you’re going to connect to the system. We’ve got to change the fee structure such that we can recover enough money from you that we can build more surface water treatment facilities to accommodate your needs. So that we can fill your demand with surface water, plus a little bit more (to replenish the aquifer according to SGMA mandates), and we’ve also got to build some more wells, because wells are going to be part of the recipe.’ …There will always be groundwater wells in the system.”

Esqueda said the water system could need $180 million of additional improvements to handle new growth. But that’s an estimate. Nor do we know for sure how many years it would take to get $180 million from water capacity fees.

One thing is certain. Growth, Esqueda said, creates “demand for more surface water.”

And the demand for more surface water brings us back to the new deal (born from mysterious sources of conflict) with Fresno Irrigation District.

As I noted at the beginning, where all this is headed is a state-regulated water system that turns Fresno into a regional utility. As Mayor Brand noted, Fresno in theory is well positioned to be water sufficient, if not water rich. The key is our entitlements to huge amounts of river water. But there’s no way Sacramento will allow that to happen if other consumers in the area are suffering from lack of clean water.

Nor would Fresno want to be sitting pretty when others are struggling. We’re all in this together.

The new water capacity fees are like a codicil to the treaty guaranteeing mutual support between two superpowers that is the City Hall-FID contract of Dec. 15.

“Both of us are working to bring as much water into the system as we can,” Esqueda said. “We’re tied at the hip.”

George Hostetter
George Hostetter is The Sun’s Fresno Civic contributor – covering the City of Fresno, County of Fresno, and Fresno Council of Governments.

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