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THE~C ITY IO+F ~~Y~.. in i~ fni ~L~~S~4NTONd CITY COUNCIL AGENDA REPORT 15 May 5, 2009 Operations Services TITLE: ADOPT A RESOLUTION REQUESTING PLEASANTON WATER CUSTOMERS VOLUNTARILY REDUCE WATER DEMAND BY TWENTY PERCENT DURING CALENDAR YEAR 2009 SUMMARY On February 27, 2009, Governor Arnold Schwarzenegger declared a state of emergency resulting from drought conditions and requested that all urban water users immediately increase water conservation efforts to reach a goal of reducing water use by twenty percent. This declaration, as well as a review of the near-term water supplies available to the Zone 7 Water Agency for delivery to the Tri-Valley water retailers, led the Committee of Valley Water Retailers (CoVWR), at their March 25, 2009 Special Meeting, to approve a resolution requesting local water customers voluntarily reduce their potable water demand by twenty percent during 2009. The CoVWR resolution recommended that each water retailer present a similar resolution to their respective legislative bodies requesting the same water use reduction from each agency's water customers in 2009. RECOMMENDATION Approve the attached Resolution requesting Pleasanton water customers reduce their potable water demand on a voluntary basis by twenty percent in Calendar Year 2009. FINANCIAL STATEMENT Water use reduction by customers will result in decreased revenue from water sales. The exact impact of reduced water sales to the City will depend on the amount of reductions, the cost of purchasing treated water from Zone 7, and the impact on City operating and maintenance operations. The City is currently performing a water rate study to adjust its existing water rates and will present this analysis to Council at a future meeting. The loss in revenue due to water conservation could be offset by changing the City's existing water rate structure to compensate for different levels of water demand reductions or slightly higher water rates or tiers for higher use customers.