MWD board revises water supply plan, adds $40M to rebate program amid drought

The Metropolitan Water District of Southern California's board of directors has revised the district's region-wide, water allocation plan and added $40 million to its conservation rebate budget in response to the state's record drought and to keep pace with unparalleled public demand.

LOS ANGELES, CA, Dec. 9, 2014 -- Today, the Metropolitan Water District (MWD) of Southern California's board of directors revised the district's region-wide, water allocation plan and added $40 million to its conservation rebate budget in response to the state's record drought and to keep pace with unparalleled public demand.

The adjusted allocation plan distributes MWD's imported supplies among its 26 member agencies during shortages and establishes a surcharge for excess water use. If drought conditions persist, the board could consider triggering the allocation plan in the first quarter of 2015.

The decision to increase the district's conservation incentive budget from $60 million to $100 million during the ongoing drought marks the second time this year MWD's board has boosted funding for water-saving rebates. Last February, the board added $20 million to MWD's conservation budget, which brought the total to $60 million.

MWD General Manager Jeff Kightlinger said the combination of heightened public drought awareness, need to conserve and expanded rebate options -- particularly turf removal -- has generated extraordinary demand from consumers and businesses for water-savings incentives (see "CA district breaks record with public's response to water-saving rebates").

"We've never experienced anything like it," said Kightlinger about the public's demand for rebates. "Last year, we spent a total of $18.6 million on our entire conservation budget, which is nearly equal to the amount expended during just the first five months of the current fiscal year. Driven by the public's response to the increased turf removal incentive, overall rebate requests are already more than nine times the total rebates paid last year."

As for the allocation plan, the primary principle of its tiered pricing levels is to alleviate disparate impacts at the retail level for MWD's member public agencies across the district's six-county service area. The plan's formula includes mechanisms to balance many considerations and help ensure that no member agencies are disproportionately impacted.

"The plan provides a prudent and responsible contingency plan should we face continued drought in 2015," Kightlinger said. "It's important to realize that this plan is being updated but not implemented at this time. It ultimately will be up to Metropolitan's board to decide whether to declare a shortage and begin allocating supplies."

Under the plan, MWD's member agencies and their retailers would be allocated supplies partly based on their dependency on the district's imported supplies, while taking into account other local supply sources. Initially adopted by the board in February 2008, the plan incorporates considerations for impact on retail customers and the economy; changes and losses in local supplies; investment in and development of local resources, and conservation achievements.

The approved revisions culminate nearly six months of discussion, collaboration and negotiation among MWD, its member agencies and affected local agencies. Among the changes were an update to the base period to fiscal years ending 2013 and 2014 and revised credits for per-capita water use reductions for agencies that have already put mandatory conservation ordinances and requirements in place.

Other changes establish a separate allocation for drought-impacted groundwater basins and replace current penalty rates with an allocation surcharge based on MWD's current turf removal program costs. Under the new surcharge, water use between 100 and 115 percent of an allocation would be charged $1,480 per acre-foot. Water use greater than 115 percent would be charged two times the surcharge, or $2,960 per acre-foot. Any revenues collected would fund the turf removal program or other similar conservation program that reduces future demands.

See also:

"MWD pushes incentive for water recycling, desalination, groundwater cleanup investments"

"CA water agencies to showcase creative conservation campaigns as part of 'ConservaCon' event"

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