FIRST AMENDMENT TO WATER SUPPLY CONTRACT
BETWEEN THE CITY AND COUNTY OF SAN FRANCISCO
THE CALIFORNIA WATER SERVICE COMPANY
SOUTH SAN FRANCISCO SERVICE AREA
FOR PURPOSES OF CONDUCTING
AN AQUIFER RECHARGE STUDY
This Amendment to contract, dated __, 2002, is entered into by the City and County of San Francisco ("City"), by and through the San Francisco Public Utilities Commission ("SFPUC") and the California Water Service Company ("Cal Water").
A. The SFPUC and Cal Water, along with other entities, previously entered into a 1984 Settlement Agreement and Master Water Sales Contract ("Master Agreement").
B. Cal Water is an investor owned utility, as defined in California Public Utilities Code Section 2701. Cal Water provides domestic water service to consumers and residents throughout the State of California, including in the South San Francisco service area.
C. The SFPUC currently supplies Cal Water with imported treated surface water from the SFPUC’s Bay Area watersheds ("SFPUC System Water") pursuant to the Master Agreement and the August 8, 1984 Water Supply Contract between Cal Water and the SFPUC.
D. Cal Water also obtains water from other sources, including groundwater pumped from the Westside Groundwater Basin ("Westside Basin") for use within Cal Water's service area.
E. Groundwater pumping has apparently resulted in a lowering of groundwater levels in the Westside Basin. As a result of these extractions, groundwater storage capacity is available in the Westside Basin.
F. The SFPUC, along with other customers of the SFPUC, wants to investigate the use of available groundwater storage capacity in the Westside Basin through a conjunctive use program in order to increase the total water available to meet water demands of the SFPUC’s retail and suburban wholesale water customers ("Suburban Purchasers") during periods of water shortage.
G. During certain years, the SFPUC has supplemental SFPUC System Water available for sale to Cal Water that can be used by Cal Water in lieu of extracting groundwater from the Westside Basin ("Supplemental Water").
H. The SFPUC and Cal Water both desire to study the effect of a reduction in Cal Water’s groundwater pumping on water levels in the Westside Basin by the seasonal substitution of Supplemental Water for groundwater normally pumped by Cal Water.
I. Additional study is required to define a conjunctive use program using the storage potential of the Westside Basin. The purpose of this contract amendment ("Study Amendment") is to use the water resources of the SFPUC system to the best possible advantage in developing a conjunctive use program for the Westside Basin. The goals of the Study Amendment are to reduce groundwater pumping by Cal Water by up to 100% (one hundred percent) during periods when Supplemental Water is available, and to obtain data to support the future coordinated management of the Westside Basin.
J. The parties contemplate that water will be stored in the Westside Basin as a result of the delivery of Supplemental Water to Cal Water under this Study Amendment. The ownership and intended beneficiaries of any such stored water is not determined by this Study Amendment but will rather be addressed as part of a possible future conjunctive use program involving the SFPUC, Cal Water, and other SFPUC wholesale customers with pumping facilities in the Westside Basin.
K. The parties recognize that Cal Water is a private, for-profit corporation and, as such, has no claim to co-grantee status under the Raker Act (as defined in the Master Agreement), which specifically bans private parties from receiving for resale any water produced by the City’s Hetch Hetchy water system or otherwise subject to the Raker Act. Nothing in this Amendment shall require or contemplate any delivery of water to Cal Water in violation of the Raker Act.
AGREEMENT OF THE PARTIES:
1. A new section 10 is added to the Contract, to read as follows:
Certain capitalized words or phrases used in this Amendment shall be defined as
2. A new section 11 is added to the Contract, to read as follows:a. "Cal Water": The California Water Service Company, South San Francisco
b. "Contract". The August 8, 1984 Individual Water Supply contract between the Cal Water's South San Francisco Service Area and the SFPUC.
c. "Master Agreement": The 1984 Master Water Sales and Settlement
Agreement between the SFPUC and the Suburban Purchasers.
d. "Study Amendment": This amendment to the 1984 Individual Water
Supply Contract between Cal Water and the SFPUC.
e. "Supplemental Water": Imported SFPUC system treated surface water
from SFPUC’s Bay Area Watersheds, purchased on an interruptible basis by
Cal Water to be used in lieu of groundwater available to Cal Water.
f. "Supply Assurance": The 184 million gallons per day (mgd) quantity of water
available to the Suburban Purchasers from the SFPUC system on an annual
average basis under §7.01 of the Master Agreement.
g. "Water Year": The commonly designated period used in the water industry of
October 1 through September 30 of each year.
h. "Westside Basin": The groundwater basin shown on the attached Exhibit 1."
"11. Term of Study Amendment
The term of this Study Amendment is for the two Water Years 2002-2003 and 2003-2004. As the implementation of the study is dependent on water availability, Cal Water and the SFPUC agree that the Study Amendment may be extended, by mutual agreement of the parties, an additional year to include the 2004-2005 Water Year should such an extension be necessary."
3. A new section 12 is added to the Contract, to read as follows:
"12. Provision of Background Data by Cal Water
Cal Water agrees to cooperate with the SFPUC and its consultants by providing access to and information reasonably available on Cal Water’s groundwater wells within the Westside Basin in order to determine aquifer water levels and other information needed for purposes of this Study Amendment. Cal Water agrees to provide the SFPUC and its consultants with the following information:
4. A new section 13 is added to the Contract, to read as follows:a. A map showing the names and locations of inactive, standby, and active Cal
Water supply wells in the Westside Basin.
b. All available lithologic logs ("drillers’ reports") and geophysical logs (e-logs) for Cal
Water’s water supply wells in the Westside Basin.
c. Data reflecting the well yield and pumping capacity for each well.
d. Information on current and projected water demand factors, including average
day, maximum day, and peak hour(s).
e. Historical pumpage data for each well, as available.
f. A copy of Cal Water's most recent Urban Water Management Plan and the historical
water supply and demand data used to make future demand projections for that document.
"13. Availability of Supplemental Water From the SFPUC
The SFPUC will forecast the availability of Supplemental Water under certain hydrologic conditions. The SFPUC’s determination of Supplemental Water availability will depend upon rainfall and water storage levels in SFPUC Bay Area reservoirs. The determination of Supplemental Water availability shall be solely at the discretion of the General Manager of the SFPUC.
The SFPUC shall notify Cal Water in writing of the availability of Supplemental
Water. Within two weeks of receiving the SFPUC’s notice of Supplemental Water availability, Cal Water shall provide information in writing setting forth (1) the quantity of Supplemental Water Cal Water agrees to purchase; (2) the plan for reduction in the amount of groundwater Cal Water will pump as a result of the purchase of Supplemental Water from the SFPUC; and (3) other information required for purposes of this Study Amendment, as set forth in Section 16 below."
5. A new section 14 is added to the Contract, to read as follows:
"14. Purchase and Delivery of Supplemental Water by Cal Water
Cal Water’s ownership, operation and maintenance of its existing surface and groundwater production and delivery facilities are not affected by this Study Amendment. Cal Water shall be solely responsible for making any and all modifications to its water production, distribution and transmission facilities required to meet its water demands using Supplemental Water, to the extent Supplemental Water can be made available through existing connections to the SFPUC system shown on Exhibit B to the Contract.
Subject to the conditions set forth herein, the parties will arrange a schedule for delivery of Supplemental Water by the SFPUC to Cal Water to allow for the delivery of Supplemental Water within the same time period in which Cal Water would otherwise pump water from the Westside Basin.
The SFPUC’s delivery of Supplemental Water will continue as long as hydrologic, operational and other conditions of concern to San Francisco permit. San Francisco will give Cal Water ten (10) working days notice prior to terminating the delivery of Supplemental Water. San Francisco's delivery of Supplemental Water to Cal Water is subject to immediate reduction or cessation in the event of emergency, earthquakes, other acts of nature, or rehabilitation or malfunctioning of San Francisco's water system, as provided in sections 7.01 and 7.03(d) of the Master Agreement.
If the SFPUC terminates delivery of Supplemental Water for any reason, the SFPUC must refund Cal Water any monies already paid and received for the Supplemental Water not delivered. Cal Water will no longer be obligated to reduce or curtail pumping following the termination of deliveries of any Supplemental Water ordered by Cal Water, as provided in Section 4 above."
6. A new section 15 is added to the Contract, to read as follows:
"15. Price of Supplemental Water
In order to create a financial incentive for Cal Water to further the purpose of this Study Amendment through the purchase of Supplemental Water, the SFPUC agrees to sell Supplemental Water for purposes of this Study Amendment to Cal Water at the following rate: $ 0.35 per hundred cubic feet of water (35 cents per ccf). The rate for water sold otherwise to Cal Water shall continue to be set pursuant to the SFPUC’s W-25 rate schedule and the terms of the Master Agreement. The W-25 rate schedule shall also continue to apply to quantities of SFPUC system water purchased in excess of Cal Water’s individual supply guarantee, it being the intent of this agreement to apply the Supplemental Water Rate set forth in this section only to SFPUC surface water deliveries that offset Cal Water's existing groundwater pumping."
7. A new section 16 is added to the Contract, to read as follows:
"16. Reduction in Groundwater Pumping by Cal Water; Provision of Data to SFPUC
At all times during the sale and receipt of Supplemental Water by the SFPUC to Cal Water, Cal Water agrees to cease pumping from its wells in the Westside Basin by a corresponding volume. Cal Water shall make the determination of necessary modifications to its pumping schedule that are required to further the goals of this Study Amendment, based upon Cal Water’s water system needs and technical concerns.
Along with its agreement to purchase Supplemental Water and provision of the information set forth in Section 3 above, Cal Water will provide the SFPUC and its consultants with a written description of how Cal Water proposes to operate its wells and water system within the Westside Basin when Supplemental Water is made available (i.e. which wells might become inactive, which wells might still be used, but at a reduced frequency; and which wells might continue to operate as they have in the recent past).'
The SFPUC and its consultants will review Cal Water's proposed operations plan. If necessary, prior to the scheduled delivery of Supplemental Water to Cal Water, the SFPUC and Cal Water agree to meet to discuss any proposed operational changes, data collection, and other matters that could affect or improve the collection of data under this Study Amendment."
8. A new section 17 is added to the Contract, to read as follows:
"17. Accounting of Supplemental Water Purchases and Groundwater Extraction Volume
The SFPUC shall be solely responsible for all costs, charges and deductions associated with the storage and transfer of Supplemental Water delivered under this Amendment prior to delivery to Cal Water, including system losses, wheeling costs and storage charges.
The total amount of Supplemental Water purchased by Cal Water from the SFPUC shall be cumulatively accounted for on an annual basis using the existing meters set forth in Exhibit B to the Contract, and shall be assumed to equal the difference between the average annual quantity of groundwater pumped by Cal Water from the Westside Basin during the years 1995-2000, less the quantity pumped during the year of the study. All of Cal Water’s Westside Basin groundwater extractions shall be metered."
9. A new section 18 is added to the Contract, to read as follows:
"18. Status of Cal Water's Allocation of Supply Assurance
Cal Water’s purchase of Supplemental Water under this Study Amendment shall not increase, decrease or otherwise modify Cal Water’s 35.297 mgd individual supply guarantee of SFPUC surface water as set forth in the 1994 allocation of residual water under the Master Agreement."
10. A new section 19 is added to the Contract, to read as follows:
"19. Rights of Parties
This Study Amendment does not, nor is it intended to, affect, alter, or impair in any manner the water rights of San Francisco or Cal Water acquired or existing under the laws of the State of California (1) to the use of waters from the SFPUC; or (2) either party’s rights to groundwater from the Westside Basin.
11. A new section 20 is added to the Contract, to read as follows:
"20. Characterization of Supplemental Water Under the Master Agreement; Statement of Purpose of Study Amendment
The SFPUC and Cal Water have entered into this Study Amendment solely for purposes of studying the effect of a reduction in Cal Water’s pumping on the Westside Basin aquifer. Cal Water agrees that all quantities of Supplemental Water purchased from the SFPUC shall not be construed as "Additional Water" as defined in section 8.01 of the Master Agreement. At the conclusion of this Study Amendment, the Parties will evaluate whether or not to proceed with the development and implementation of a Westside Basin conjunctive use program, following appropriate environmental review and the completion of other necessary prerequisites to such a program."
12. A new section 21 is added to the Contract, to read as follows:
"21. Reservation of Claims in Master Agreement
Nothing in this Study Amendment is intended to, or shall be construed to, waive or compromise any of the claims reserved by San Francisco or the Suburban Purchasers in the Master Agreement. Except as expressly provided herein, the Master Agreement between the SFPUC and the Suburban Purchasers, including Cal Water, is unchanged and remains in full force and effect."
IN WITNESS WHEREOF, the parties have executed this Study Amendment, in duplicate, on the day first mentioned above.
CITY AND COUNTY OF SAN FRANCISCO CALIFORNIA WATER SERVICE COMPANY
General Manager Robert R. Guzzetta
San Francisco Public Utilities Vice President-Engineering
Commission and Water Quality
Paul G. Ekstrom
PUC Res. No. __________________
Approved as to Form: Approved as to Form:
Dennis J. Herrera Duane Morris LLP
By: ___________________________ By: ________________________________
Joshua D. Milstein Colin L. Pearce
Deputy City Attorney Attorneys for California Water Service Company
Board of Supervisors
Resolution No. ________
Clerk of said Board