22 - Laserfiche WebLink

22 THE CITY OF �] -- - 211 "" CITY COUNCIL AGENDA REPORT pLE ASANTON March 15, 2022 Operations Services TITLE: RECEIVE AN UPDATE ON THE 2022 WATER SUPPLY, STAGE 2 — 15% MANDATORY WATER CONSERVATION, AND ADOPT A RESOLUTION TO ACTIVATE STAGE 2 WATER DROUGHT RATES SUMMARY At its October 5, 2021, meeting, City Council adopted urgency Ordinance No. 2225 declaring a Local Drought Emergency due to the critically reduced water supplies and continued extreme dry weather for the protection of public health, safety, and welfare. Concurrently, City Council adopted Resolution No. 21-1250 declaring a State 2 Water Shortage and mandating water customers reduce their potable water usage by 15 percent. Since City Council's October 5, 2021, action, drought conditions remain in effect. Precipitation for northern California has improved with a total to date of 31.9 inches or 92 percent of average. However, reservoir storage has not recovered which continues to limit available water supplies heading further into 2022. Staff will provide an update on the Zone 7 Water Agency (Zone 7) 2022 water supply allocation from the State Water Project (SWP) and its plan to meet the City's potable water demand. Additionally, staff will provide an update on the 15 percent water conservation target compared to 2020 use. Lastly, staff is recommending the City Council adopt a resolution to activate Stage 2 Water Drought Rates (Drought Rates) to help offset the revenue impacts of decreased water consumption while also providing an additional incentive to conserve water and discourage wasteful or inefficient water use through pricing. RECOMMENDATION Staff recommends the City Council adopt a resolution activating Stage 2 Water Drought Rates per the City's Master Fee Schedule to be effective May 1, 2022. FINANCIAL STATEMENT The estimated loss of revenue for FY 2021/22 due in part to the 15 percent mandatory conservation is estimated at $3.2 million, which was included in the Midyear FY 2021/22 budget report which Council accepted by resolution on March 1, 2022. If the City Council approves the implementation of the Stage 2 Drought Rates and they become effective on May 1, 2022, Drought Rates shall be applied to customers after a customer's full bi-monthly billing cycle begins on or after May 1, 2022. Any revenues collected from the Drought Rates will be in FY 2022/23.