1. Slide 1 April 18, 2006 Oakdale Irrigation District Water Resources Plan A Community Plan. A Successful Future. Financial Model and Discussion of Preferred Project Oakdale Irrigation District Water Resources Plan A Community Plan. A Successful Future. Financial Model and Discussion of Preferred Project

2. 2 The Water Resources Plan Goals Technical Analyses Institutional Activities Public Involvement Provide long-term protection to OID’s water rights. Address federal, state, and local water challenges. Rebuild/modernize an out-of-date system to meet changing customer needs. Develop affordable ways to finance improvements. Involve the public in the planning process.

3. 3 The Project Team will need Board Input Throughout the PEIR Preparation Technical Analyses Institutional Activities Public Involvement Numerous issues from Phase 1 need continued Board input. Some items specifically relate to PEIR activities Other items, while not strictly tied to PEIR, need continued Board discussion

4. 4 Schedule of Board Involvement Expansion of Service Policy Guiding Principles (Board Action)

5. 5 The WRP Recommends Expansion into the SOI w The WRP goals need to be consistent with OID policies w A review of the current OID Annexation Policy is necessary w Recommend a 2 step process – Develop “Guiding Principles” – Revise Annexation Policy as necessary w Provide long-term protection to OID’s water rights w Address federal, state and local water challenges w Rebuild/modernize an out-of-date system to meet changing customer needs w Develop affordable ways to finance improvements w Involve the public in the planning process

6. 6 Guiding Principles are District Policy Statements GP #1: Expansion into SOI shall not negatively impact existing OID customers as it relates to water supply reliability, cost of service, availability of service, etc. GP #2: Transfers should achieve the greatest local benefit with the least amount transferred.

7. 7 Guiding Principles are District Policy Statements GP #3: When surplus water becomes available over the next 20 years, it shall be committed to meeting several priorities. 1.Transferred to meet the WRP Goals and economic needs of the District, 2.To insure the future local water needs for the cities of Oakdale and Riverbank, 3.To increase opportunities for expansion within the sphere of influence 4.And other needs as determined by the Board

8. 8 Guiding Principles are District Policy Statements GP #4: Water for SOI expansion shall be provided as a supplemental supply to SOI users. GP #5: Expansion into SOI shall only occur on developed agricultural land.

9. 9 Outside the OID service area (within SOI): w Fruits and Nuts: 6,900 acres w Corn and Oats: 3,700 acres

10. 10 Guiding Principles are District Policy Statements GP #6: Agricultural water for SOI expansion shall be prioritized based on considering all the following factors: 1.Least water demand 2.Highest efficiency of use (trees over pasture) 3.Large ag parcels over small ag parcels 4.Contiguous over non-contiguous 5.Least long-term maintenance costs to OID 6.Least cost to serve by OID 7.Ability to benefit local aquifers (in-lieu recharge) 8.Self-sufficient during a drought – can pump their own water and can pump into OID canal for use downstream 9.No ag water drainage leaving property

11. 11 Schedule of Board Involvement Confirmation of “Preferred Alternative” (Proposed Program) Financial Model/Water Transfer Discussion CEQA Next Steps

12. 12 The Preferred Alternative (“Proposed Program”) has Several Components Flow Control and Measurement Canal Maintenance and Rehabilitation CIP Pipe Replacement Main Canals and Tunnels Program District Groundwater Wells New Regulating Reservoir and Woodward Intertie Turnout Replacement Program Surface Water Outflow Management Drainwater Reclamation Program Drought Response Plan Expansion into Sphere of Influence Water Transfers Future Provision of Water for Cities

13. 13 The Preferred Alternative (“Proposed Program”) has Several Components Flow Control and Measurement Canal Maintenance and Rehabilitation CIP Pipe Replacement Main Canals and Tunnels Program District Groundwater Wells New Regulating Reservoir and Woodward Intertie Turnout Replacement Program Surface Water Outflow Management Drainwater Reclamation Program Drought Response Plan Expansion into Sphere of Influence Water Transfers Future Provision of Water for Cities

14. 14 Flow Control and Measurement w Improve DSO ability to meet customer water needs w Enable growers to modernize on-farm operations w Reduce operational spills w Supports revised Service Standards w All projects within OID Right of Way

15. 15 Flow Control and Measurement Example Project w New concrete structure w Motor operated flow control gates w Downstream measurement flumes w SCADA w Flows coordinated with reservoir releases Customer Benefits: Enables consistent water levels, ability to better respond to customer demands, grower in control

16. 16 Main Canals and Tunnels Program 2-Mile Bar Goodwin Dam Tunnel No. 7 Tunnel No. 9 w 2-mile bar slide zone outside OID Right of Way w Main Canals &Tunnels are on separate CEQA track but will be discussed in PEIR w Working with Condor to prioritize projects relative to other WRP needs

17. 17 OID Groundwater Wells Program w Improve peak supply flexibility w Increase drought year supply reliability w Locations TBD by OID over course of Implementation w May require Right of Way acquisition

18. 18 District Drought Response Plan Additional District groundwater pumping capabilities Cooperative use of private groundwater wells Expansion of Service into areas with groundwater Modifications to delivery schedules Pursue land idling agreements as a consideration for long or severe droughts

19. 19 Regulating Reservoir Recommendations Van Lier Reservoir South Side: Adjust Van Lier Operations North Side: Re-establish Intertie to Woodward Reservoir North Side: New Reservoir at Burnett-Cometa split Woodward Reservoir New Reservoir

20. 20 North Side Reservoir w Manage mismatches in supply and demand w Meet increases in irrigation demand, providing greater flexibility and shorter response time w Provide temporary storage of excess flows during unscheduled cuts in demand w Will involve Right of Way acquisition

21. 21 Woodward Intertie

22. 22 Drainwater Reclamation Program w Improve peak irrigation season supply closer to the point of use, which increases operating and scheduling flexibility w Plan routing of excess lateral flows to the drainwater storage reservoirs w Some facilities will require Right of Way acquisition

23. 23 Surface Water Outflow Management Program w Regulate outflows from the OID service area w Provide predictable timing/quantity for managed re-use by downstream water users w Potential water quality benefits w Facilities will require Right of Way acquisition

24. 24 These Program Components Make Up the Preferred Alternative Flow Control and Measurement Canal Maintenance and Rehabilitation CIP Pipe Replacement Main Canals and Tunnels Program District Groundwater Wells New Regulating Reservoir and Woodward Intertie Turnout Replacement Program Surface Water Outflow Management Drainwater Reclamation Program Drought Response Plan Expansion into Sphere of Influence Water Transfers Future Provision of Water for Cities

25. 25 Schedule of Board Involvement Confirmation of “Preferred Alternative” (Proposed Program) Financial Model/Water Transfer Discussion CEQA Next Steps

26. 26 Four alternatives were developed to address what to do with conserved water Alternative 3 moderately expands service within OID’s Sphere of Influence. ALTERNATIVE 4 67,000 ac-ft Supports OID expansion into SOI, approx. 16,750 acres Transfers to willing buyers (9,000 ac-ft more than current) Variable transfers to willing buyers ALTERNATIVE 2 50,000 ac-ft 17,000 ac-ft Transfers to willing buyers (9,000 ac-ft more than current) ALTERNATIVE 3 50,000 ac-ft 17,000 ac-ft Supports OID expansion into SOI, approx. 4,250 acres

27. 27 Financial Model was Used to Evaluate Revenue Options Rates and Charges -54,100 acres in-District (-1,600 acres net) -4,250 acres expansion ($1,600 buy-in, in- District rate – equiv to $40/ac long-term contract w/ no buy-in) -3% annual escalation Hydropower -Based on current agreement -$12.5M to $5.5M annually

28. 28 Financial Model was Used to Evaluate Revenue Options Other -Property Tax and Miscellaneous -Assumed that by 2007, ERAF Terminates Water Transfers -Stanislaus River (Top) 30,000 to 50,000 af ($210/af) -Surface Water Outflow (Bottom) 0 to 30,000 af ($20/af)

29. 29 WRP Recommended Alt

30. 30 No Water Transfers, Full Annex

31. 31 Water Charge would need to Increase without Water Transfers

32. 32 Transfers are Necessary to Achieve WRP Goals Annual Costs -O&M = $8M -CIP = $3M - $6M -Main Canals and Tunnels (debt service) - $5M Revenue (w/o Transfers) -Water Charge = $1M -Misc = $0 - $1M -Power - $5.5M - $12.5M Total = $16M to $19MTotal = $6.5M to $14.5M

33. 33 Schedule of Board Involvement Confirmation of “Preferred Alternative” (Proposed Program) Financial Model/Water Transfer Discussion CEQA Next Steps

34. 34 California Environmental Quality Act (CEQA) Process w Disclose potential impacts of a proposed program/project w Programmatic document to allow for development/refinement of future actions (e.g. water transfers) w Obtain public and agency input w Mitigate potential significant impacts (if any) to extent possible OID’s role: Consider the above when making a decision on the program

35. 35 Disclosure of Alternative Selection Process and Potential Impacts Evaluate proposed project Summarize alternatives selection process Alternatives evaluated (in WRP) – provides basis for elimination discussion No Project is basis for impact analysis Potential impacts to be evaluated (e.g.): ― Water quality ― Biological resources/habitat ― Groundwater levels Actions included as part of proposed project ― Potential for growth inducement (water transfers and annexations)

36. 36 Preferred/Best Apparent Alternative = Proposed Program w Proposed program must be defined to allow for environmental review w Vast majority of individual actions or individual will require additional refinement (e.g. outflow basin locations and operations) w PEIR will identify overall anticipated impacts and identify avoidance criteria and programmatic mitigation w Future documents (primarily negative declarations) will tier from PEIR and use avoidance criteria and mitigation as applicable

37. 37 CEQA Path Forward Programmatic review Those actions/projects that are essentially O&M will be identified as such (e.g. Flow Measurement projects) Resource studies (landowner contacts for field reviews) Public draft to be released in November (administrative draft by end of September)

38. 38 Implementing Proposed Program Will Benefit OID’s Customers and the Community w Protect OID’s water rights. w Enhance customer service for all users. w Rebuild, modernize, and expand system infrastructure. w Protect the future water supply needs of the cities of Oakdale and Riverbank. w Keep water rates affordable through a balanced effort of water transfers and service to “new” customers within OID’s Sphere of Influence. w Substantially increase water supply reliability and meet OID service in a worst-case drought.

39. 39 Summary Significant Board and public interaction Have fully defined and characterized the Proposed Program Ready to start impact analyses

40. 40 Schedule of Board Involvement Infrastructure Projects and Details, Consolidation of Main Canals and Tunnels and near- term WRP Projects (3-year CIP)

41. Slide 41 April 18, 2006 Oakdale Irrigation District Water Resources Plan A Community Plan. A Successful Future. Financial Model and Discussion of Preferred Project Oakdale Irrigation District Water Resources Plan A Community Plan. A Successful Future. Financial Model and Discussion of Preferred Project