WEBVTT

00:30:01.166 --> 00:30:03.234
THERE WE GO. PERFECT. THANK YOU.

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WELL GOOD MORNING EVERYONE.

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WELCOME TO THIS JOINT COMMITTEE

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WITH LOCAL GOV. DELIGHTED THAT

00:30:10.175 --> 00:30:11.776
WE COULD TAKE THIS SUBJECT

00:30:11.843 --> 00:30:13.545
MATTER ON BECAUSE IT IS VERY

00:30:13.611 --> 00:30:15.747
VERY URGENT AT THIS MOMENT.

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CLIMATE CHANGE IS UPON US. WITH

00:30:17.615 --> 00:30:20.818
THAT COMES CHANGES IN HYDROLOGY

00:30:20.885 --> 00:30:22.887
AND HOW WE ARE GETTING OUR

00:30:22.954 --> 00:30:26.257
WATER. AND WE'VE GOT A LOT OF

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DELUGES OF WATER THAT COME AT

00:30:27.659 --> 00:30:29.661
CERTAIN TIMES, AND WE'VE GOT A

00:30:29.727 --> 00:30:32.597
LOT OF OLD INFRASTRUCTURE. AND

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SO THE TOPIC REALLY TODAY IS,

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IS GIVEN THAT WE HAVE MAJOR

00:30:37.802 --> 00:30:38.870
INVESTMENTS IN FRONT OF US THAT

00:30:38.937 --> 00:30:40.705
WE NEED TO MAKE BECAUSE OF

00:30:40.772 --> 00:30:41.706
AGING INFRASTRUCTURE AND THE

00:30:41.773 --> 00:30:43.074
CHANGE IN HYDROLOGY, HOW DO WE

00:30:43.141 --> 00:30:44.976
GET THERE? HOW ARE WE CURRENTLY

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PAYING FOR FOR NEEDED

00:30:47.845 --> 00:30:48.846
INFRASTRUCTURE? AND HOW DO WE

00:30:48.913 --> 00:30:53.184
GET TO INCREASED FINANCING FOR

00:30:53.251 --> 00:30:54.619
THE INCREASED NEED FOR

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INFRASTRUCTURE? SO I WOULD LIKE

00:30:56.421 --> 00:30:58.590
TO WELCOME MY CO-CHAIR FROM

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FROM LOCAL GOV AND TURN IT OVER

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TO HIM FOR SOME OPENING REMARKS.

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GOOD MORNING, EVERYBODY, AND

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THANK YOU FOR BEING HERE. AND

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THANK YOU, MY CO CHAIR,

00:31:07.298 --> 00:31:10.101
ASSEMBLYMAN PEPIN, AND LOOKING

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FORWARD TO HEAR FROM THE

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PANELISTS THAT HAVE TAKEN THE

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TIME OF THEIR BUSY SCHEDULE TO

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ATTEND AND SPEAK ON THE

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INFORMATIONAL HEARING. THANK

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YOU AGAIN. LOOKING FORWARD TO

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THE CONVERSATIONS WE'RE GOING

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TO HAVE, AND HOPEFULLY WE'LL

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HAVE OTHERS JOIN US LATER ON.

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AND I'LL COME TO INTRODUCE THE

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FIRST PANEL. WE WANT TO

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INTRODUCE THEM. OH, SURE. WELL,

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WE'LL HAVE THE FIRST PANEL COME

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FORWARD. GO AHEAD. IF YOU WANT

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TO DO IT, TAKE IT, TAKE IT OVER.

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SO THE FIRST PANEL IS ABOUT HOW

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DOES CALIFORNIA PAY FOR WATER.

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WHAT DOES WATER COSTS. AND ARE

00:31:39.063 --> 00:31:40.365
WE USING THE RIGHT TOOLS TO

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KEEP WATER AFFORDABLE? AND WITH

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THAT, WE WANT TO INTRODUCE

00:31:45.403 --> 00:31:46.804
RILEY FRANKLIN WITH PUBLIC

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POLICY INSTITUTE OF CALIFORNIA.

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SONJA PATEK LEGISLATIVE

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ANALYST'S OFFICE. MISS CASEY

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SCHIMKE, DEPARTMENT OF WATER

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RESOURCES, IMPLEMENTATION OF SB

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72, AND KARLA NEMETH,

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ASSOCIATION OF CALIFORNIA WATER

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AGENCIES. WELCOME AND THANK YOU

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FOR BEING HERE. BEFORE WE START,

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WE DO HAVE CARLA REMOTELY. JUST

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WANT TO MAKE SURE THAT'S BEEN

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SECURED. NOT YET. OKAY. IF YOU

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COULD LET ME KNOW WHEN, WHEN,

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WHEN SHE COMES ON. THANK YOU.

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ALL RIGHT, LET'S START WITH

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BRADLEY FRANKLIN. WELCOME.

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MADAM CHAIR. MR. CHAIR,

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HONORABLE MEMBERS OF THE

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COMMITTEE, THANK YOU FOR

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INVITING ME TO SPEAK TODAY ON

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FINANCING CALIFORNIA'S WATER.

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MY. OKAY. SO THE MAIN MESSAGE

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OF MY TALK TODAY IS THAT

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CALIFORNIA NEEDS TO IDENTIFY

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STEADY, RELIABLE SOURCES OF

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FUNDING FOR WATER. WE ARE

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CURRENTLY OVERLY DEPENDENT ON

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GENERAL OBLIGATION BONDS TO TO

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FINANCE MANY AREAS OF THE WATER

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SECTOR. SORRY. OKAY, SO

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CALIFORNIA'S WATER SYSTEM IS

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EXCEPTIONALLY COMPLEX. WE HAVE

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A CLIMATE WHERE WATER

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CONDITIONS CHANGE DRAMATICALLY

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FROM SEASON TO SEASON AND YEAR

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TO YEAR. AND MOREOVER, WE HAVE

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TO TRANSPORT WATER LONG

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DISTANCES FROM NORTHERN TO

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SOUTHERN CALIFORNIA. ALL OF

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THAT REQUIRES A VERY COMPLEX,

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HIGHLY ENGINEERED SYSTEM, WHICH

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IS COSTLY TO MAINTAIN.

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CALIFORNIA CURRENTLY SPENDS

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OVER $40 BILLION A YEAR TO

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MAINTAIN THE SYSTEM. MOST OF

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THAT FUNDING COMES FROM LOCAL

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SOURCES. OVER 80% OF OUR

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FUNDING COMES FROM LOCAL WATER

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BILLS AND SEWER BILLS,

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PRIMARILY WATER AND SEWER BILLS,

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AND THE STATE CONTRIBUTES OVER

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10%. AND THE FEDERAL GOVERNMENT,

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A SMALL, SMALL PROPORTION OF

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THE TOTAL COST. CLIMATE CHANGE

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IS, OF COURSE, ONE OF THE MAJOR

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STRESSORS THAT. ON THE SYSTEM

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THAT REQUIRES MAJOR NEW

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INVESTMENTS. OTHER OTHER

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STRESSORS ARE AGING

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INFRASTRUCTURE AND NEW WATER

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REGULATIONS. AND I'D LIKE TO GO

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INTO THOSE IN TURN. SO MUCH OF

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CALIFORNIA'S WATER

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INFRASTRUCTURE WAS BUILT

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BETWEEN THE 1930S AND 1970S.

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THE DAMS, CANALS, AND AQUEDUCTS

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THAT WERE BUILT ARE NOW AGING

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AND NEED EXPENSIVE UPGRADES. ON

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TOP OF THAT, WE HAVE KEY PARTS

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OF THE SYSTEM THAT CONVEY WATER,

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WHICH HAVE BEEN DAMAGED FROM

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SINKING LAND DUE TO GROUNDWATER

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OVERUSE, AND THOSE THOSE

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REQUIRE EXPENSIVE FIXES AS WELL.

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CLIMATE CHANGE IS ADDING NEW

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PRESSURE ON TOP OF THAT. SO OUR

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OUR SNOWPACK IS BECOMING LESS

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RELIABLE AS TEMPERATURES RISE.

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AND THAT PUTS STRAIN ON OUR

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INFRASTRUCTURE AND REQUIRES

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DIFFERENT WAYS OF OPERATING THE

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INFRASTRUCTURE THAT WE DO HAVE.

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SEA LEVEL RISE IS A FACTOR IN

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COASTAL FLOODING. AND AND WE

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HAVE SEEN THREE MAJOR FLOODS

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SINCE 2012 THAT COST ABOUT $8

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BILLION IN DAMAGES AND 29 LIVES

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LOST. ON TOP OF THAT, THERE ARE

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NEW WATER REGULATIONS AND RULES

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THAT NEED TO BE IMPLEMENTED

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THAT COME WITH SIGNIFICANT

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COSTS FOR GROUNDWATER. THE

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SUSTAINABLE GROUNDWATER

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MANAGEMENT ACT REQUIRES

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OVERDRAFTED BASINS TO AVOID

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UNDESIRABLE RESULTS, WHICH IN

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PRACTICE OFTEN MEANS REDUCED

00:35:37.268 --> 00:35:39.003
GROUNDWATER PUMPING. THIS IS

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ESPECIALLY A PROBLEM IN THE SAN

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JOAQUIN VALLEY. THE LOCAL WATER

00:35:43.407 --> 00:35:44.375
AGENCIES TASKED WITH

00:35:44.442 --> 00:35:46.544
IMPLEMENTING SIGMA HAVE

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IDENTIFIED MANY POSSIBLE

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PROJECTS TO EASE THE

00:35:51.649 --> 00:35:54.819
GROUNDWATER CUTS, BUT THEY ARE

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QUITE EXPENSIVE IN AGGREGATE,

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WITH $19 BILLION IN PROJECTS

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PROPOSED TO DATE FOR DRINKING

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WATER. THERE ARE NEW STANDARDS

00:36:04.228 --> 00:36:05.696
FROM CONTAMINANTS THAT NEED TO

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BE TREATED. ONE OF THE BIG ONES

00:36:08.232 --> 00:36:10.635
IS PFAS, OR THE FOREVER

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CHEMICALS THAT WILL REQUIRE

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SIGNIFICANT NEW TREATMENT

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INFRASTRUCTURE AND COSTS GOING

00:36:19.076 --> 00:36:21.145
FORWARD. IN ORANGE COUNTY ALONE,

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THAT'S EXPECTED TO COST $1.8

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BILLION. AS I SAID, MOST OF THE

00:36:32.056 --> 00:36:33.691
FUNDING COMES FROM LOCAL

00:36:33.758 --> 00:36:36.627
SOURCES. SO THE RULES OF

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SETTING, SETTING WATER RATES

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ARE VERY IMPORTANT.

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UNDERSTANDING THE FINANCE

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SITUATION. I BELIEVE SOME OF

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THE OTHER PANELISTS WILL GO

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INTO THIS IN MORE DETAIL, BUT I

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WOULD JUST LIKE TO POINT OUT

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THAT PROPOSITION 218 CREATES

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SEVERAL CONSTRAINTS FOR LOCAL

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WATER AGENCIES. THE CENTRAL

00:36:58.282 --> 00:37:01.385
KIND OF PHILOSOPHY OF PROP 218

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IS THAT WATER RATES SHOULD BE

00:37:04.422 --> 00:37:05.823
CHARGED PROPORTIONAL TO THE

00:37:05.890 --> 00:37:07.892
COST OF DELIVERY TO EACH

00:37:07.959 --> 00:37:09.060
CUSTOMER. NOW THAT CREATES A

00:37:09.126 --> 00:37:11.896
HIGH BAR FOR PROVING WHY YOU'RE

00:37:11.963 --> 00:37:13.564
CHARGING WHAT YOU ARE. AND IF

00:37:13.631 --> 00:37:15.099
YOU WANT TO CHARGE SOMEONE

00:37:15.166 --> 00:37:17.268
DIFFERENTLY, AND THAT LIMITS

00:37:17.335 --> 00:37:20.171
THE ABILITY TO USE CONSERVATION

00:37:20.237 --> 00:37:22.707
PRICING. SO WATER UTILITIES

00:37:22.773 --> 00:37:24.442
WOULD LIKE TO IMPLEMENT TIERED

00:37:24.508 --> 00:37:25.776
RATES SO THAT PEOPLE WHO USE

00:37:25.843 --> 00:37:27.678
MORE WATER PAY MORE FOR THAT

00:37:27.745 --> 00:37:30.247
ADDITIONAL WATER, AND THEREFORE

00:37:30.314 --> 00:37:32.083
GIVING THEM AN INCENTIVE TO

00:37:32.149 --> 00:37:34.986
CONSERVE IT ALSO, PROPOSITION

00:37:35.052 --> 00:37:37.054
218 ALSO GREATLY LIMITS THE

00:37:37.121 --> 00:37:38.856
ABILITY OF AGENCIES TO

00:37:38.923 --> 00:37:40.291
IMPLEMENT AFFORDABILITY

00:37:40.358 --> 00:37:43.561
PROGRAMS, BECAUSE THEY CANNOT

00:37:43.628 --> 00:37:45.363
USE RATES FROM ONE SET OF

00:37:45.429 --> 00:37:47.898
CUSTOMERS TO SUBSIDIZE OTHER

00:37:47.965 --> 00:37:49.333
CUSTOMERS, IN THIS CASE, LOW

00:37:49.400 --> 00:37:50.735
INCOME HOUSEHOLDS THAT COULD

00:37:50.801 --> 00:37:54.338
USE HELP WITH THEIR WATER BILLS.

00:37:54.405 --> 00:37:57.975
SO PROP 218 CREATES LEGAL

00:37:58.042 --> 00:37:59.276
CONSTRAINTS FOR THESE AGENCIES.

00:37:59.343 --> 00:38:01.946
AND ON TOP OF THAT, THEY HAVE

00:38:02.013 --> 00:38:03.781
PRACTICAL LIMITS AS TO HOW MUCH

00:38:03.848 --> 00:38:05.349
THEY CAN RAISE, HOW MUCH THEY

00:38:05.416 --> 00:38:06.951
CAN RAISE THEIR RATES AND PASS

00:38:07.018 --> 00:38:08.386
THROUGH COSTS TO THEIR

00:38:08.452 --> 00:38:09.620
CUSTOMERS. MANY WATER AGENCIES

00:38:09.687 --> 00:38:13.090
ARE VERY CONCERNED ABOUT HAVING

00:38:13.157 --> 00:38:16.027
UNAFFORDABLE RATES. THAT AND SO

00:38:16.093 --> 00:38:18.829
SO THAT'S A SERIOUS CHALLENGE.

00:38:18.896 --> 00:38:21.399
BUT AT LEAST URBAN WATER

00:38:21.465 --> 00:38:22.500
AGENCIES AND WASTEWATER

00:38:22.566 --> 00:38:25.302
AGENCIES HAVE A RATE RATEPAYER

00:38:25.369 --> 00:38:27.838
BASE THAT THEY CAN RELY ON.

00:38:27.905 --> 00:38:29.340
MANY PARTS OF CALIFORNIA'S

00:38:29.407 --> 00:38:32.276
WATER SYSTEM DO NOT A PPIC WE

00:38:32.343 --> 00:38:34.712
CALL THOSE FISCAL ORPHANS. THEY

00:38:34.779 --> 00:38:36.514
ARE PARTS OF THE WATER SYSTEM

00:38:36.580 --> 00:38:38.549
THAT HAVE A PERSISTENT FUNDING

00:38:38.616 --> 00:38:41.052
GAP AND NO OBVIOUS WAY TO FILL.

00:38:41.118 --> 00:38:43.587
THERE ARE SEVERAL. THE BIGGEST

00:38:43.654 --> 00:38:45.322
OF THEM BY FAR, THOUGH, IS

00:38:45.389 --> 00:38:49.727
FLOOD RISK MANAGEMENT. OVER 7

00:38:49.794 --> 00:38:51.095
MILLION CALIFORNIANS LIVE IN

00:38:51.162 --> 00:38:53.297
AREAS WITH FLOOD RISK. THE

00:38:53.364 --> 00:38:55.032
FLOOD RISK MAPS THAT WE HAVE

00:38:55.099 --> 00:38:58.035
ARE OUTDATED, SO THE RISK IS IN

00:38:58.102 --> 00:39:00.171
ALL LIKELIHOOD HIGHER AND

00:39:00.237 --> 00:39:02.406
GROWING. THIS YEAR WE'RE SEEING,

00:39:02.473 --> 00:39:04.842
OF COURSE, A SUPER EL NINO

00:39:04.909 --> 00:39:08.045
EVENT, WHICH IS ALREADY CAUSED

00:39:08.112 --> 00:39:10.214
RECORD SEA LEVEL CONDITIONS AND

00:39:10.281 --> 00:39:12.817
FLOODING AND COASTAL AREAS. AND

00:39:12.883 --> 00:39:14.719
THE REST OF THE WINTER MAY MAY

00:39:14.785 --> 00:39:20.291
SEE FURTHER FLOODING. SO

00:39:20.357 --> 00:39:21.358
CURRENTLY, CALIFORNIA SPENDS

00:39:21.425 --> 00:39:23.194
ABOUT $1 BILLION A YEAR ON

00:39:23.260 --> 00:39:27.131
FLOOD RISK MANAGEMENT PROJECTS.

00:39:27.198 --> 00:39:28.966
OF THAT, ABOUT HALF COMES FROM

00:39:29.033 --> 00:39:30.401
STATE AND FEDERAL GOVERNMENT.

00:39:30.468 --> 00:39:32.737
AND THE HALF IS VERY DEPENDENT

00:39:32.803 --> 00:39:34.338
ON GENERAL OBLIGATION BONDS TO

00:39:34.405 --> 00:39:37.608
FUND ITS SHARE. THERE'S A NEED

00:39:37.675 --> 00:39:40.644
FOR, THOUGH, FOR 1 TO $3.5

00:39:40.711 --> 00:39:43.114
BILLION ANNUALLY. IN ADDITION

00:39:43.180 --> 00:39:46.283
TO THAT. AND THAT IS JUST FOR

00:39:46.350 --> 00:39:49.120
THE RISK FROM RIVERS THAT FLOOD.

00:39:49.186 --> 00:39:50.955
COASTAL FLOODING IS A DIFFERENT

00:39:51.021 --> 00:39:53.791
PROBLEM, AND SEA LEVEL RISE IS

00:39:53.858 --> 00:39:55.926
EXACERBATING THAT. WE HAVE

00:39:55.993 --> 00:39:58.162
ESTIMATES THAT IN THE BAY AREA,

00:39:58.229 --> 00:40:01.232
OVER 100, OR ABOUT $105 BILLION

00:40:01.298 --> 00:40:03.134
OF ADAPTATION PROJECTS ARE

00:40:03.200 --> 00:40:08.172
NEEDED TO MEET THE NEED BY 2050.

00:40:08.239 --> 00:40:11.776
NOW THERE ARE SEVERAL OTHER

00:40:11.842 --> 00:40:14.011
FISCAL ORPHANS. AS I MENTIONED,

00:40:14.078 --> 00:40:16.113
HEADWATERS MANAGEMENT IS

00:40:16.180 --> 00:40:17.581
CRITICAL. ONE TWO THIRDS OF OUR

00:40:17.648 --> 00:40:20.417
WATER COMES FROM HEADWATERS,

00:40:20.484 --> 00:40:21.886
AND THE STATE HAS RAMPED UP

00:40:21.952 --> 00:40:23.988
EFFORTS TO TREAT THOSE FOR THE

00:40:24.054 --> 00:40:25.222
FORESTS IN THOSE AREAS, TO MAKE

00:40:25.289 --> 00:40:27.291
THEM MORE WILDFIRE RESILIENT,

00:40:27.358 --> 00:40:29.160
SO THAT SEVERE WILDFIRE DOES

00:40:29.226 --> 00:40:31.195
NOT IMPAIR OUR WATER SUPPLY IN

00:40:31.262 --> 00:40:34.431
TERMS OF QUALITY AND QUANTITY.

00:40:34.498 --> 00:40:36.233
DRINKING WATER SYSTEMS FOR

00:40:36.300 --> 00:40:39.170
SMALL, LOW INCOME COMMUNITIES

00:40:39.236 --> 00:40:40.971
ARE VERY CHALLENGED BECAUSE

00:40:41.038 --> 00:40:42.373
THEY DO NOT HAVE THE RATEPAYER

00:40:42.439 --> 00:40:44.875
BASE TO COVER THE NEEDED

00:40:44.942 --> 00:40:45.976
INVESTMENTS TO RAISE THEIR

00:40:46.043 --> 00:40:48.112
WATER QUALITY STANDARDS, UP TO

00:40:48.179 --> 00:40:51.782
UP TO THE LEVEL REQUIRED. THE

00:40:51.849 --> 00:40:53.217
STATE WATER BOARD NEEDS

00:40:53.284 --> 00:40:54.785
ASSESSMENT IN 2024 ESTIMATED

00:40:54.852 --> 00:40:57.855
THAT THERE'S A $3.9 BILLION

00:40:57.922 --> 00:41:01.125
NEED OVER FIVE YEARS FOR

00:41:01.192 --> 00:41:02.159
ELIGIBLE GRANT ELIGIBLE

00:41:02.226 --> 00:41:04.728
PROJECTS IN AT RISK AND FAILING

00:41:04.795 --> 00:41:10.434
PUBLIC WATER SYSTEMS. SIMILARLY,

00:41:10.501 --> 00:41:12.269
STORMWATER TO TREAT POLLUTED

00:41:12.336 --> 00:41:15.539
STORMWATER IS PERENNIALLY A

00:41:15.606 --> 00:41:16.941
FUNDING CHALLENGE OUTSIDE OF LA

00:41:17.007 --> 00:41:18.409
COUNTY, WHERE THEY HAVE MEASURE

00:41:18.475 --> 00:41:19.910
W, MOST AREAS OF THE STATE DO

00:41:19.977 --> 00:41:21.879
NOT HAVE A WAY OF FUNDING THESE

00:41:21.946 --> 00:41:23.147
PROJECTS, AND THE FUNDING NEED

00:41:23.214 --> 00:41:29.153
THERE IS ESTIMATED TO BE ABOUT

00:41:29.220 --> 00:41:30.621
700 MILLION TO $1.1 BILLION.

00:41:30.688 --> 00:41:32.456
ECOSYSTEMS ARE LIKEWISE

00:41:32.523 --> 00:41:33.157
CHALLENGED WITH THE NEED OF

00:41:33.224 --> 00:41:36.126
ABOUT 600 MILLION TO $1 BILLION

00:41:36.193 --> 00:41:39.597
A YEAR, ALTHOUGH ECOSYSTEM

00:41:39.663 --> 00:41:41.065
STEWARDSHIP HAS RECEIVED

00:41:41.131 --> 00:41:42.132
CONSIDERABLE BOND FUNDING IN

00:41:42.199 --> 00:41:44.268
RECENT YEARS, THE ONGOING NEED

00:41:44.335 --> 00:41:48.639
IS STILL THERE. SO IN

00:41:48.706 --> 00:41:49.673
CONCLUSION, I'D JUST LIKE TO

00:41:49.740 --> 00:41:52.977
REITERATE THAT CALIFORNIA HAS

00:41:53.043 --> 00:41:56.547
LARGE, LARGE AND GROWING

00:41:56.614 --> 00:41:58.749
FINANCING NEEDS FOR WATER. WE

00:41:58.816 --> 00:42:03.220
ARE RELIANT ON LOCAL RATEPAYERS

00:42:03.287 --> 00:42:05.022
TO FUND MUCH OF IT, BUT THE.

00:42:05.089 --> 00:42:06.156
BUT THEY ARE LIMITED IN HOW

00:42:06.223 --> 00:42:09.159
MUCH THEY CAN CONTRIBUTE.

00:42:09.226 --> 00:42:11.328
BEYOND THAT, FISCAL ORPHANS

00:42:11.395 --> 00:42:13.130
LACK A RELIABLE SOURCE OF

00:42:13.197 --> 00:42:14.665
FUNDING. THEY'RE OVERLY RELIANT

00:42:14.732 --> 00:42:17.368
ON GENERAL OBLIGATION BONDS.

00:42:17.434 --> 00:42:20.404
AND SO, IN SUM, WE NEED SOMEHOW

00:42:20.471 --> 00:42:23.207
TO FIND A SOURCE OF STEADY,

00:42:23.274 --> 00:42:25.309
RELIABLE FUNDING FOR THESE FOR

00:42:25.376 --> 00:42:28.245
THESE AREAS OF WATER. THANK YOU

00:42:28.312 --> 00:42:30.748
VERY MUCH FOR THE OPPORTUNITY

00:42:30.814 --> 00:42:35.419
TO PRESENT TODAY. THANK YOU SO

00:42:35.486 --> 00:42:36.787
MUCH. AND I THINK WE'LL

00:42:36.854 --> 00:42:37.821
PROBABLY HAVE QUESTIONS AT THE

00:42:37.888 --> 00:42:40.457
END OF THIS PANEL. SO DON'T GO

00:42:40.524 --> 00:42:43.294
AWAY WITH THAT. I WILL TURN IT

00:42:43.360 --> 00:42:47.298
OVER TO SONIA PETAK. GOOD

00:42:47.364 --> 00:42:48.365
MORNING, MADAM CHAIR. MISTER

00:42:48.432 --> 00:42:50.200
CHAIR, I'M SONIA PETAK WITH THE

00:42:50.267 --> 00:42:51.435
LEGISLATIVE ANALYST'S OFFICE,

00:42:51.502 --> 00:42:53.804
AND WE WERE ASKED TO COME TODAY

00:42:53.871 --> 00:42:56.006
TO PROVIDE SOME BACKGROUND ON

00:42:56.073 --> 00:42:58.175
THE STATE'S ROLE IN FUNDING

00:42:58.242 --> 00:42:59.977
WATER RELATED PROJECTS. AND YOU

00:43:00.044 --> 00:43:01.645
SHOULD HAVE A HANDOUT BEFORE

00:43:01.712 --> 00:43:03.847
YOU. I'M NOT SURE IT MAY BE

00:43:03.914 --> 00:43:04.815
PROJECTED. IT'S ALSO AVAILABLE

00:43:04.882 --> 00:43:06.750
ON OUR WEBSITE FOR VIEWERS

00:43:06.817 --> 00:43:10.754
ONLINE AT Þ DOT CA.GOV. IF YOU

00:43:10.821 --> 00:43:14.692
CAN TURN TO PAGE ONE OF THE

00:43:14.758 --> 00:43:16.160
HANDOUT, I WANTED TO START BY

00:43:16.226 --> 00:43:17.861
TALKING ABOUT WHY DOES THE

00:43:17.928 --> 00:43:20.097
STATE FUND WHAT IT WHAT IT DOES

00:43:20.164 --> 00:43:21.865
FUND, AS WE'VE ALREADY HEARD,

00:43:21.932 --> 00:43:23.334
AND WILL CONTINUE TO HEAR FROM

00:43:23.400 --> 00:43:25.769
OTHER PANELISTS TODAY, THERE

00:43:25.836 --> 00:43:27.604
ARE DEFINITELY SOME CHALLENGES

00:43:27.671 --> 00:43:30.507
FACING LOCAL AGENCIES. WE'LL

00:43:30.574 --> 00:43:31.976
ALSO HEAR SOME PERSPECTIVES

00:43:32.042 --> 00:43:33.143
FROM OTHER PANELISTS ON WHAT

00:43:33.210 --> 00:43:34.712
THE STATE SHOULD FUND, BUT I

00:43:34.778 --> 00:43:35.946
THOUGHT I'D GO AHEAD AND START

00:43:36.013 --> 00:43:37.781
WITH WHY THE STATE FUNDS WHAT

00:43:37.848 --> 00:43:40.284
IT CURRENTLY FUNDS. MOST OF

00:43:40.351 --> 00:43:42.453
WHAT THE STATE FUNDS STEMS FROM

00:43:42.519 --> 00:43:45.255
SOME SORT OF LEGAL REQUIREMENT,

00:43:45.322 --> 00:43:47.091
LEGAL OR STATUTORY OR

00:43:47.157 --> 00:43:49.626
REGULATORY REQUIREMENT. THE

00:43:49.693 --> 00:43:51.362
LIST BEFORE YOU ARE SOME

00:43:51.428 --> 00:43:52.463
EXAMPLES. IT'S NOT AN

00:43:52.529 --> 00:43:56.400
EXHAUSTIVE LIST. AND AND THESE

00:43:56.467 --> 00:43:58.569
PROJECTS ARE NOT NECESSARILY

00:43:58.635 --> 00:44:00.738
100% STATE FUNDED. OH GREAT.

00:44:00.804 --> 00:44:03.273
THANK YOU. THAT'S VERY HARD TO

00:44:03.340 --> 00:44:05.075
READ. SORRY, THIS IS NOT A

00:44:05.142 --> 00:44:06.210
POWERPOINT PRESENTATION. IT'S

00:44:06.276 --> 00:44:10.180
JUST A PDF. APOLOGIES FOR THAT.

00:44:10.247 --> 00:44:11.548
SO WE'RE SHARING ON OUR

00:44:11.615 --> 00:44:13.717
COMPUTER SCREEN HERE. OKAY. SO

00:44:13.784 --> 00:44:14.818
WE'LL STAY RIGHT WITH YOU.

00:44:14.885 --> 00:44:16.553
THANKS. OKAY. THANK YOU SO MUCH.

00:44:16.620 --> 00:44:18.055
SO I WANT TO START BY

00:44:18.122 --> 00:44:19.523
HIGHLIGHTING JUST A COUPLE OF

00:44:19.590 --> 00:44:20.991
EXAMPLES. I'M NOT GOING TO GO

00:44:21.058 --> 00:44:22.760
THROUGH ALL OF THESE. BUT FOR

00:44:22.826 --> 00:44:24.161
EXAMPLE, THE STATE HAS LEGAL

00:44:24.228 --> 00:44:25.295
LIABILITY WHEN IT COMES TO THE

00:44:25.362 --> 00:44:27.064
STATE'S PLAN OF FLOOD FLOOD

00:44:27.131 --> 00:44:28.832
CONTROL. AND THIS IS DUE TO A

00:44:28.899 --> 00:44:30.234
2003 COURT DECISION. PATERNO

00:44:30.300 --> 00:44:32.770
VERSUS THE STATE. BECAUSE OF

00:44:32.836 --> 00:44:34.738
THIS, THE STATE HAS AN INTEREST

00:44:34.805 --> 00:44:36.707
IN HELPING TO FUND SOME OF THE

00:44:36.774 --> 00:44:38.542
FLOOD PROJECTS IN THE CENTRAL

00:44:38.609 --> 00:44:40.310
VALLEY. TO REDUCE SOME OF THAT

00:44:40.377 --> 00:44:43.580
RISK. THE STATE ALSO HAS SOME

00:44:43.647 --> 00:44:44.648
CONTRACTUAL AND SETTLEMENT

00:44:44.715 --> 00:44:46.617
AGREEMENT OBLIGATIONS, JUST TO

00:44:46.683 --> 00:44:48.385
NAME ONE EXAMPLE. THE STATE HAS

00:44:48.452 --> 00:44:50.421
SOME FINANCIAL RESPONSIBILITIES

00:44:50.487 --> 00:44:53.290
WHEN IT COMES TO ECOSYSTEM AND

00:44:53.357 --> 00:44:54.725
HABITAT RESTORATION AT THE

00:44:54.792 --> 00:44:56.193
SALTON SEA. DUE TO THE

00:44:56.260 --> 00:44:57.294
QUANTIFICATION SETTLEMENT

00:44:57.361 --> 00:44:59.763
AGREEMENT, SOME OF THE STATE'S

00:44:59.830 --> 00:45:02.099
OBLIGATIONS ARE IN STATUTE,

00:45:02.166 --> 00:45:04.168
SUCH AS DEBT SERVICE ON GENERAL

00:45:04.234 --> 00:45:05.836
OBLIGATION BONDS, AND THEN SOME

00:45:05.903 --> 00:45:07.204
OF THE STATUTORY REQUIREMENTS

00:45:07.271 --> 00:45:08.806
ARE THINGS THAT THE STATE HAS

00:45:08.872 --> 00:45:10.974
CHOSEN TO DO AND PUT INTO

00:45:11.041 --> 00:45:12.843
STATUTE, AND THEREBY CAN ALSO

00:45:12.910 --> 00:45:16.346
BE CHANGED OR ADDED TO OR

00:45:16.413 --> 00:45:18.449
REMOVED. IN ADDITION, THE STATE

00:45:18.515 --> 00:45:19.983
HAS SOME REGULATORY

00:45:20.050 --> 00:45:21.085
REQUIREMENTS. AND JUST A COUPLE

00:45:21.151 --> 00:45:22.820
OF EXAMPLES THERE. IT MUST

00:45:22.886 --> 00:45:24.288
FOLLOW REQUIREMENTS RELATED TO

00:45:24.354 --> 00:45:27.124
STATE AND FEDERAL ENDANGERED

00:45:27.191 --> 00:45:30.127
SPECIES ACTS, AS WELL AS ENSURE

00:45:30.194 --> 00:45:34.731
THE SAFETY OF STATE OWNED DAMS.

00:45:34.798 --> 00:45:38.335
IF YOU TURN TO THE NEXT PAGE,

00:45:38.402 --> 00:45:40.838
THE THE NEXT PAGE THAT YOU

00:45:40.904 --> 00:45:44.041
CAN'T REALLY SEE ON THIS

00:45:44.108 --> 00:45:48.378
HANDOUT. OKAY. I WANTED TO NEXT

00:45:48.445 --> 00:45:50.247
TALK ABOUT, OH, YOU KNOW, MAYBE

00:45:50.314 --> 00:45:52.749
I'M GOING TO JUST GIVE UP.

00:45:52.816 --> 00:45:53.917
MAYBE YOU COULD JUST I DON'T

00:45:53.984 --> 00:45:55.853
KNOW IF IT'S EASY TO JUST TAKE

00:45:55.919 --> 00:45:57.054
THAT DOWN. I FEEL LIKE THAT'S

00:45:57.121 --> 00:45:58.889
NOT HELPING. I WANTED TO GO

00:45:58.956 --> 00:46:00.257
OVER WHAT THE STATE'S MAIN

00:46:00.324 --> 00:46:01.325
SOURCES OF FUNDING ARE FOR

00:46:01.391 --> 00:46:03.827
WATER RELATED PROJECTS. AND ON

00:46:03.894 --> 00:46:06.396
THIS PAGE TWO, WE'LL START WITH

00:46:06.463 --> 00:46:08.232
GENERAL OBLIGATION BONDS. THIS

00:46:08.298 --> 00:46:10.134
IS PROBABLY THE BIGGEST SOURCE

00:46:10.200 --> 00:46:11.401
OF STATE FUNDING, ESPECIALLY

00:46:11.468 --> 00:46:13.604
SINCE 2000 VOTERS HAVE APPROVED

00:46:13.670 --> 00:46:15.739
NINE GENERAL OBLIGATION BONDS

00:46:15.806 --> 00:46:18.308
TOTALING ABOUT $41 BILLION. NOT

00:46:18.375 --> 00:46:19.910
ALL OF THESE BONDS ARE STRICTLY

00:46:19.977 --> 00:46:21.478
FOR WATER RELATED PROJECTS AND

00:46:21.545 --> 00:46:23.313
ACTIVITIES. THEY. SOME ARE MORE

00:46:23.380 --> 00:46:24.715
EXPANSIVE TO INCLUDE OTHER

00:46:24.781 --> 00:46:26.583
NATURAL RESOURCES RELATED

00:46:26.650 --> 00:46:28.318
PROJECTS. IF YOU TURN TO THE

00:46:28.385 --> 00:46:30.187
NEXT PAGE, HOWEVER, I WANTED TO

00:46:30.254 --> 00:46:31.989
HIGHLIGHT IN THE THREE MOST

00:46:32.055 --> 00:46:33.423
RECENTLY APPROVED BONDS

00:46:33.490 --> 00:46:37.361
PROPOSITIONS ONE, 68 AND FOUR

00:46:37.427 --> 00:46:39.930
VOTERS HAVE APPROVED ABOUT 14

00:46:39.997 --> 00:46:41.365
BILLION IN GENERAL OBLIGATION

00:46:41.431 --> 00:46:43.133
BONDS FOR WATER RELATED

00:46:43.200 --> 00:46:44.868
PROJECTS. THESE BONDS FUND A

00:46:44.935 --> 00:46:46.403
WIDE VARIETY OF PROJECTS,

00:46:46.470 --> 00:46:48.472
EVERYTHING FROM SORT OF HARD

00:46:48.539 --> 00:46:49.940
INFRASTRUCTURE, YOU KNOW, WATER

00:46:50.007 --> 00:46:53.544
RECYCLING PROJECTS,

00:46:53.610 --> 00:46:55.746
DESALINATION, FLOOD RELATED

00:46:55.812 --> 00:46:57.781
PROJECTS, AS WELL AS HABITAT

00:46:57.848 --> 00:47:01.518
RESTORATION PROJECTS. ANOTHER

00:47:01.585 --> 00:47:02.619
OBVIOUSLY IMPORTANT SOURCE OF

00:47:02.686 --> 00:47:04.354
STATE FUNDING IS THE STATE'S

00:47:04.421 --> 00:47:05.789
GENERAL FUND. THE GENERAL FUND

00:47:05.856 --> 00:47:07.224
OFTEN COMES INTO PLAY WHEN

00:47:07.291 --> 00:47:09.026
THERE'S NOT ANOTHER AVAILABLE

00:47:09.092 --> 00:47:11.895
SOURCE OF FUNDING, OR THERE'S

00:47:11.962 --> 00:47:14.064
NOT ANOTHER ELIGIBLE SOURCE OF

00:47:14.131 --> 00:47:16.233
FUNDING. IT'S ALSO COME INTO

00:47:16.300 --> 00:47:17.634
PLAY WHEN THERE HAVE BEEN

00:47:17.701 --> 00:47:19.703
BUDGET SURPLUSES, AND THIS WAS

00:47:19.770 --> 00:47:22.673
THE CASE IN IN RECENT YEARS,

00:47:22.739 --> 00:47:25.209
THE LEGISLATURE APPROPRIATED

00:47:25.275 --> 00:47:27.711
ABOUT 6.5 BILLION THROUGH ONE

00:47:27.778 --> 00:47:29.279
OF THE CLIMATE PACKAGES FOR

00:47:29.346 --> 00:47:30.714
WATER AND DROUGHT RESILIENCE.

00:47:30.781 --> 00:47:32.549
JUST IN THE IN THE PAST SEVERAL

00:47:32.616 --> 00:47:34.351
YEARS, AND MOST OF THAT 6.5

00:47:34.418 --> 00:47:35.452
BILLION WAS FROM THE GENERAL

00:47:35.519 --> 00:47:38.555
FUND, ANOTHER KEY SOURCE OF

00:47:38.622 --> 00:47:39.690
FUNDING IN RECENT YEARS HAS

00:47:39.756 --> 00:47:41.091
BEEN THE GREENHOUSE GAS

00:47:41.158 --> 00:47:43.594
REDUCTION FUND, WHICH IS THE.

00:47:43.660 --> 00:47:45.095
THE PROCEEDS FROM THE STATE'S

00:47:45.162 --> 00:47:47.531
CAP AND INVEST PROGRAM. AND

00:47:47.598 --> 00:47:53.370
SINCE 20 2021, GRF HAS PROVIDED

00:47:53.437 --> 00:47:55.105
$130 MILLION ANNUALLY FOR THE

00:47:55.172 --> 00:47:56.907
STATE'S SAFE DRINKING WATER

00:47:56.974 --> 00:47:59.843
PROGRAM, CALLED SAFER. HOWEVER,

00:47:59.910 --> 00:48:01.245
CHANGES TO THE RECENT CHANGES

00:48:01.311 --> 00:48:03.046
TO THE CAP AND INVEST PROGRAM

00:48:03.113 --> 00:48:05.215
MEAN THAT REVENUES ARE LIKELY

00:48:05.282 --> 00:48:08.085
GOING TO BE COMING IN LOWER TO

00:48:08.151 --> 00:48:09.486
THE GREENHOUSE GAS REDUCTION

00:48:09.553 --> 00:48:12.055
FUND. CHANGES MADE IN STATUTE

00:48:12.122 --> 00:48:14.925
ALSO MADE IT SO THAT THE SAFER

00:48:14.992 --> 00:48:17.494
PROGRAM IS NOT GUARANTEED 130

00:48:17.561 --> 00:48:19.630
MILLION ANNUALLY, AND TO THAT

00:48:19.696 --> 00:48:24.968
POINT IN FISCAL 2627, GRF IS

00:48:25.035 --> 00:48:26.470
PROVIDING 71 MILLION TO THE

00:48:26.536 --> 00:48:30.007
SAFER PROGRAM. TURNING TO THE

00:48:30.073 --> 00:48:31.675
NEXT PAGE, I JUST WANTED TO

00:48:31.742 --> 00:48:34.711
HIGHLIGHT A FEW OF THE AREAS.

00:48:34.778 --> 00:48:36.480
THESE ARE JUST NOT EXAMPLES.

00:48:36.546 --> 00:48:37.881
AGAIN, NOT AN EXHAUSTIVE LIST,

00:48:37.948 --> 00:48:39.082
BUT JUST A FEW EXAMPLES OF

00:48:39.149 --> 00:48:40.884
WHERE THE STATE WORKS WITH THE

00:48:40.951 --> 00:48:42.219
FEDERAL GOVERNMENT TO EITHER

00:48:42.286 --> 00:48:43.754
ADMINISTER FUNDS OR PROVIDE A

00:48:43.820 --> 00:48:46.623
STATE MATCH FOR FEDERALLY RUN

00:48:46.690 --> 00:48:48.725
PROGRAMS. SO JUST TO HIGHLIGHT

00:48:48.792 --> 00:48:51.295
HERE, THE STATE WATER RESOURCES

00:48:51.361 --> 00:48:53.030
CONTROL BOARD ADMINISTERS

00:48:53.096 --> 00:48:54.831
FEDERAL GRANTS FROM THE U.S.

00:48:54.898 --> 00:48:56.466
ENVIRONMENTAL PROTECTION AGENCY

00:48:56.533 --> 00:48:58.135
THROUGH THE STATE REVOLVING

00:48:58.201 --> 00:48:59.936
FUNDS, THE DRINKING WATER STATE

00:49:00.003 --> 00:49:01.004
REVOLVING FUND, AND THE CLEAN

00:49:01.071 --> 00:49:04.207
WATER DRINKING WATER STATE

00:49:04.274 --> 00:49:07.878
REVOLVING FUND. THESE ARE

00:49:07.944 --> 00:49:08.879
GRANTS FROM THE FEDERAL

00:49:08.945 --> 00:49:10.013
GOVERNMENT THAT THE STATE

00:49:10.080 --> 00:49:11.448
ADMINISTERS AS LOW INTEREST

00:49:11.515 --> 00:49:14.117
LOANS OR PRINCIPAL FORGIVENESS

00:49:14.184 --> 00:49:16.086
TO LOCAL WATER AGENCIES FOR

00:49:16.153 --> 00:49:20.023
MOSTLY CAPITAL PROJECTS. THE

00:49:20.090 --> 00:49:21.491
CALIFORNIA OFFICE OF EMERGENCY

00:49:21.558 --> 00:49:23.360
SERVICES ALSO ADMINISTERS FUNDS

00:49:23.427 --> 00:49:24.728
FROM THE FEDERAL EMERGENCY

00:49:24.795 --> 00:49:26.863
MANAGEMENT AGENCY. THESE FUNDS

00:49:26.930 --> 00:49:28.732
ARE RELATED TO DISASTERS,

00:49:28.799 --> 00:49:31.935
EITHER DISASTER RECOVERY OR IN

00:49:32.002 --> 00:49:33.804
SOME CASES, SORT OF

00:49:33.870 --> 00:49:35.605
PRE-DISASTER MITIGATION RISK.

00:49:35.672 --> 00:49:37.007
THESE. IN THE WATER SPACE. THIS

00:49:37.074 --> 00:49:39.543
IS PRIMARILY IN THE AREA OF

00:49:39.609 --> 00:49:41.978
FLOOD MANAGEMENT AND DAM SAFETY.

00:49:42.045 --> 00:49:43.814
AND THEN I WANTED TO HIGHLIGHT

00:49:43.880 --> 00:49:45.315
THE DEPARTMENT OF WATER

00:49:45.382 --> 00:49:47.084
RESOURCES, COLLABORATES WITH

00:49:47.150 --> 00:49:48.852
THE U.S. ARMY CORPS OF

00:49:48.919 --> 00:49:50.721
ENGINEERS ON FLOOD MANAGEMENT

00:49:50.787 --> 00:49:52.522
PROJECTS. AND IN THIS CASE, THE

00:49:52.589 --> 00:49:54.257
PROJECTS ARE LED BY THE U.S.

00:49:54.324 --> 00:49:56.426
ARMY CORPS, AND THE STATE AND

00:49:56.493 --> 00:49:58.228
LOCAL GOVERNMENTS PROVIDE THE

00:49:58.295 --> 00:50:01.331
NONFEDERAL MATCH. TURNING TO

00:50:01.398 --> 00:50:03.233
THE NEXT PAGE, I WANT TO

00:50:03.300 --> 00:50:04.801
CONCLUDE BY HIGHLIGHTING SOME

00:50:04.868 --> 00:50:06.303
OF THE KEY CHALLENGES

00:50:06.370 --> 00:50:07.237
ASSOCIATED WITH THE STATE

00:50:07.304 --> 00:50:08.638
SOURCES OF FUNDING FOR WATER

00:50:08.705 --> 00:50:10.841
RELATED PROJECTS AND ACTIVITIES.

00:50:10.907 --> 00:50:13.043
I'VE ALREADY TALKED ABOUT THE

00:50:13.110 --> 00:50:14.478
CURRENT SORT OF CHALLENGE WE'RE

00:50:14.544 --> 00:50:16.613
FACING WITH THE THE LOWER

00:50:16.680 --> 00:50:18.014
REVENUES IN THE GREENHOUSE GAS

00:50:18.081 --> 00:50:19.449
REDUCTION FUND FOR THE SAFER

00:50:19.516 --> 00:50:21.284
PROGRAM. BUT I ALSO WANTED TO

00:50:21.351 --> 00:50:22.719
HIGHLIGHT SOME CHALLENGES WITH

00:50:22.786 --> 00:50:24.654
BOND FUNDING, FEDERAL FUNDING,

00:50:24.721 --> 00:50:26.690
AND THE STATE'S GENERAL FUND.

00:50:26.757 --> 00:50:28.892
SO BONDS ARE TYPICALLY USED FOR

00:50:28.959 --> 00:50:30.093
LARGE INFRASTRUCTURE PROJECTS

00:50:30.160 --> 00:50:32.062
THAT HAVE LONG TERM BENEFITS.

00:50:32.129 --> 00:50:33.897
AND BECAUSE OF THAT, IT MAKES

00:50:33.964 --> 00:50:37.167
SENSE THAT CURRENT RESIDENTS,

00:50:37.234 --> 00:50:38.435
AS WELL AS FUTURE RESIDENTS,

00:50:38.502 --> 00:50:40.003
ARE GOING TO BE PAYING OFF THE

00:50:40.070 --> 00:50:42.506
COST OF THOSE BONDS OVER TIME.

00:50:42.572 --> 00:50:43.573
HOWEVER, BONDS ARE TYPICALLY

00:50:43.640 --> 00:50:46.843
NOT USED TO PAY FOR ONGOING

00:50:46.910 --> 00:50:48.645
ANNUAL SORT OF ANNUAL

00:50:48.712 --> 00:50:50.046
MAINTENANCE AND OPERATIONS

00:50:50.113 --> 00:50:51.548
COSTS. AND BECAUSE OF THAT,

00:50:51.615 --> 00:50:52.649
ANOTHER SOURCE OF FUNDING OFTEN

00:50:52.716 --> 00:50:54.551
HAS TO BE IDENTIFIED TO PAY FOR

00:50:54.618 --> 00:50:56.520
OPERATIONS AND MAINTENANCE. IN

00:50:56.586 --> 00:50:58.655
ADDITION, IN ADDITION TO BEING

00:50:58.722 --> 00:51:00.924
SORT OF EPISODIC, BONDS DON'T

00:51:00.991 --> 00:51:03.193
HAPPEN ALL THE TIME. BONDS CAN

00:51:03.260 --> 00:51:05.128
BE EXPENSIVE, AN EXPENSIVE WAY

00:51:05.195 --> 00:51:06.997
TO FUND PROJECTS BECAUSE OF THE

00:51:07.063 --> 00:51:08.031
INTEREST THAT ACCUMULATES ON

00:51:08.098 --> 00:51:11.001
THOSE BONDS OVER TIME. I ALSO

00:51:11.067 --> 00:51:13.003
WANTED TO HIGHLIGHT ONE OF THE

00:51:13.069 --> 00:51:14.204
FEDERAL PROGRAMS, THE STATE

00:51:14.271 --> 00:51:16.740
REVOLVING FUNDS. SO THE STATE

00:51:16.807 --> 00:51:18.842
IS ABOUT TO FACE A LARGE

00:51:18.909 --> 00:51:19.943
REDUCTION IN THE AMOUNT OF

00:51:20.010 --> 00:51:21.378
FEDERAL FUNDING PROVIDED FOR

00:51:21.445 --> 00:51:23.180
THE STATE OR STATE REVOLVING

00:51:23.246 --> 00:51:25.015
FUNDS. AND THIS IS BECAUSE THE

00:51:25.081 --> 00:51:26.049
FEDERAL INFRASTRUCTURE

00:51:26.116 --> 00:51:27.884
INVESTMENT AND JOBS ACT HAD

00:51:27.951 --> 00:51:29.986
PROVIDED A SIGNIFICANT BUT

00:51:30.053 --> 00:51:31.021
TEMPORARY INCREASE IN THE

00:51:31.087 --> 00:51:32.155
AMOUNT OF FUNDING PROVIDED TO

00:51:32.222 --> 00:51:35.125
THESE FUNDS, THAT THOSE

00:51:35.192 --> 00:51:36.193
ADDITIONAL FUNDS WERE AVAILABLE

00:51:36.259 --> 00:51:40.430
FROM 2022 TO 2026, IN ADDITION

00:51:40.497 --> 00:51:43.033
TO THE SORT OF DROP OFF IN THAT,

00:51:43.099 --> 00:51:44.434
BECAUSE THOSE FUNDS ARE NOW

00:51:44.501 --> 00:51:45.836
EXHAUSTED. SO IN ADDITION TO

00:51:45.902 --> 00:51:47.971
THE THE DROP OFF IN THOSE FUNDS,

00:51:48.038 --> 00:51:49.806
CONGRESS IS INCREASINGLY USING

00:51:49.873 --> 00:51:52.309
THE STATE REVOLVING FUNDS TO

00:51:52.375 --> 00:51:54.544
PAY FOR SORT OF EARMARKED

00:51:54.611 --> 00:51:55.946
PROJECTS AROUND THE COUNTRY.

00:51:56.012 --> 00:51:57.347
AND ALTHOUGH SOME OF THESE

00:51:57.414 --> 00:51:59.916
PROJECTS MAY TAKE PLACE OR BE

00:51:59.983 --> 00:52:01.384
LOCATED IN CALIFORNIA, WHICH IS

00:52:01.451 --> 00:52:03.253
A BENEFIT TO THE STATE, THEY'RE

00:52:03.320 --> 00:52:05.055
NOT NECESSARILY GOING THROUGH

00:52:05.121 --> 00:52:06.456
THE STATE WATER RESOURCES

00:52:06.523 --> 00:52:08.525
CONTROL BOARDS PLANNING PROCESS.

00:52:08.592 --> 00:52:09.993
SO THEY'RE NOT SORT OF PART OF

00:52:10.060 --> 00:52:12.162
THIS STRATEGIC STATEWIDE PLAN.

00:52:12.229 --> 00:52:14.297
IN ADDITION, THOSE FUNDS ARE

00:52:14.364 --> 00:52:15.699
USED ONE TIME, WHEREAS FUNDS

00:52:15.765 --> 00:52:17.501
THAT GO THROUGH THE STATE'S

00:52:17.567 --> 00:52:20.070
REVOLVING FUND ARE REVOLVING.

00:52:20.136 --> 00:52:22.138
SO THEY CAN BEGIN, THEY CAN BE

00:52:22.205 --> 00:52:23.406
USED AGAIN AND AGAIN AS THOSE

00:52:23.473 --> 00:52:26.142
LOW INTEREST LOANS ARE PAID OFF.

00:52:26.209 --> 00:52:27.310
FINALLY, ON THE LAST PAGE, I

00:52:27.377 --> 00:52:29.145
WANT TO CLOSE BY NOTING THAT

00:52:29.212 --> 00:52:31.248
THE STATE GENERAL FUND OUTLOOK

00:52:31.314 --> 00:52:33.450
IS TENUOUS, AND OUR OFFICE WILL

00:52:33.517 --> 00:52:35.519
BE PUBLISHING ITS ANNUAL FISCAL

00:52:35.585 --> 00:52:36.686
OUTLOOK IN A COUPLE OF WEEKS.

00:52:36.753 --> 00:52:37.854
I'M SORRY IT WASN'T AVAILABLE

00:52:37.921 --> 00:52:40.257
FOR TODAY'S HEARING, BUT WE

00:52:40.323 --> 00:52:42.359
JUST WANT TO HIGHLIGHT THAT,

00:52:42.425 --> 00:52:45.228
YOU KNOW, INCOME TAX REVENUE

00:52:45.295 --> 00:52:46.363
COLLECTIONS HAVE BEEN COMING IN

00:52:46.429 --> 00:52:48.198
VERY STRONG, BUT WE DON'T THINK

00:52:48.265 --> 00:52:50.667
THAT THIS IS SUSTAINABLE. THOSE

00:52:50.734 --> 00:52:53.570
TAX COLLECTIONS REFLECT SORT OF

00:52:53.637 --> 00:52:57.574
AN OVERHEATED STOCK MARKET. AND

00:52:57.641 --> 00:52:59.609
WE THINK THAT IT'S NOW SHOWING

00:52:59.676 --> 00:53:01.378
SEVERAL CLASSIC SIGNS OF A

00:53:01.444 --> 00:53:03.647
FINANCIAL BUBBLE. AND THESE

00:53:03.713 --> 00:53:06.883
TYPES OF SORT OF RELATIVE

00:53:06.950 --> 00:53:08.251
EPISODES TYPICALLY RESULT IN A

00:53:08.318 --> 00:53:10.820
DRAMATIC REVERSAL. AS SUCH, WE

00:53:10.887 --> 00:53:12.656
WOULD RECOMMEND AGAINST VIEWING

00:53:12.722 --> 00:53:16.226
THOSE STRONG TAX COLLECTIONS AS

00:53:16.293 --> 00:53:17.627
SUSTAINABLE AND INSTEAD BE

00:53:17.694 --> 00:53:21.264
PREPARED FOR POTENTIALLY LOWER

00:53:21.331 --> 00:53:22.399
REVENUES IN THE TENS OF

00:53:22.465 --> 00:53:23.433
BILLIONS OF DOLLARS OVER THE

00:53:23.500 --> 00:53:26.002
NEXT 1 TO 2 YEARS. SO WITH THAT,

00:53:26.069 --> 00:53:27.671
THANK YOU VERY MUCH. AND I'LL

00:53:27.737 --> 00:53:36.012
PASS IT TO THE NEXT SPEAKER.

00:53:36.079 --> 00:53:37.814
GOOD MORNING, MADAM CHAIR. MR.

00:53:37.881 --> 00:53:39.649
CHAIR. MY NAME IS CASEY SCHIMKE.

00:53:39.716 --> 00:53:41.017
I AM THE DEPUTY DIRECTOR FOR

00:53:41.084 --> 00:53:42.185
LEGISLATIVE AFFAIRS WITH THE

00:53:42.252 --> 00:53:43.920
CALIFORNIA DEPARTMENT OF WATER

00:53:43.987 --> 00:53:48.358
RESOURCES. I WANT TO ECHO SOME

00:53:48.425 --> 00:53:50.060
OF THE COMMENTS THAT HAVE BEEN

00:53:50.126 --> 00:53:53.363
BEEN MADE SO FAR. I ALSO WANT

00:53:53.430 --> 00:53:54.864
TO THEN TALK A LITTLE BIT ABOUT

00:53:54.931 --> 00:53:58.368
WHAT WE ARE DOING AS A STATE IN

00:53:58.435 --> 00:53:59.836
RESPONSE. HOW ARE WE PLANNING

00:53:59.903 --> 00:54:05.141
FOR THE NEXT STEPS, NEXT PHASES?

00:54:05.208 --> 00:54:13.984
SO WHEN WE HAVE. JUST I'M GOING

00:54:14.050 --> 00:54:15.285
TO I'M GOING TO JUMP IN REALLY

00:54:15.352 --> 00:54:17.120
QUICKLY WITH WHAT I CALL THE

00:54:17.187 --> 00:54:19.255
THE, THE SCARY SLIDE FOR YOU,

00:54:19.322 --> 00:54:23.293
WHICH IS GOING BACK ONE, WHAT

00:54:23.360 --> 00:54:25.228
ARE THE, WHAT ARE SOME OF THE

00:54:25.295 --> 00:54:26.196
STRESSES WE'RE FACING? AND

00:54:26.262 --> 00:54:27.330
WE'VE HEARD SOME OF THOSE

00:54:27.397 --> 00:54:28.398
ALREADY FROM DOCTOR FRANKLIN.

00:54:28.465 --> 00:54:30.400
WE HEARD THOSE. MADAM CHAIR, IN

00:54:30.467 --> 00:54:31.468
YOUR OPENING STATEMENTS,

00:54:31.534 --> 00:54:33.269
CLIMATE CHANGE, AGING

00:54:33.336 --> 00:54:35.505
INFRASTRUCTURE. AND WE'RE GOING

00:54:35.572 --> 00:54:37.307
TO BE WE'RE GOING TO BE LOOKING

00:54:37.374 --> 00:54:40.443
AT AT AT SOME OF THOSE

00:54:40.510 --> 00:54:41.945
SPECIFICALLY, I THINK A LOT OF

00:54:42.012 --> 00:54:43.980
THEM DO Kò IN ON ON WHAT WHAT

00:54:44.047 --> 00:54:45.515
HAS BEEN MENTIONED, CLIMATE

00:54:45.582 --> 00:54:46.983
CHANGE, AGING INFRASTRUCTURE,

00:54:47.050 --> 00:54:49.419
RISING COSTS AND COMPETING

00:54:49.486 --> 00:54:50.553
NEEDS. I THINK THOSE ARE THE

00:54:50.620 --> 00:54:54.124
FOUR BIG ONES. WE AS A

00:54:54.190 --> 00:54:57.394
DEPARTMENT ARE CHARGED WITH

00:54:57.460 --> 00:54:59.929
EVERY FIVE YEARS UPDATING THE

00:54:59.996 --> 00:55:02.766
CALIFORNIA WATER PLAN. IN THAT

00:55:02.832 --> 00:55:05.468
PLAN, WE EVALUATE THE STATE'S

00:55:05.535 --> 00:55:08.872
WATER SYSTEM REGIONALLY,

00:55:08.938 --> 00:55:12.509
STATEWIDE. WHAT WHAT ARE THE

00:55:12.575 --> 00:55:14.344
CONDITIONS THAT WE'RE FACING?

00:55:14.411 --> 00:55:15.412
FOR YEARS NOW, WE'VE BEEN

00:55:15.478 --> 00:55:16.746
TALKING ABOUT, YOU KNOW, FUTURE

00:55:16.813 --> 00:55:17.781
IMPACTS OF CLIMATE CHANGE, AND

00:55:17.847 --> 00:55:19.349
NOW WE ARE SEEING THE IMPACTS

00:55:19.416 --> 00:55:21.518
OF CLIMATE CHANGE AS WE MOVE,

00:55:21.584 --> 00:55:25.855
MOVE INTO THIS. SO I'M GOING TO

00:55:25.922 --> 00:55:27.323
QUICKLY GO THROUGH THE NEXT

00:55:27.390 --> 00:55:29.426
SLIDE BECAUSE IT HAS BEEN

00:55:29.492 --> 00:55:30.527
PREVIOUSLY MENTIONED. YOU KNOW,

00:55:30.593 --> 00:55:31.761
HOW DO WE GET HERE? WELL, WE

00:55:31.828 --> 00:55:33.329
HAVE OUR AGING INFRASTRUCTURE.

00:55:33.396 --> 00:55:38.468
WE HAVE 18TH OR 19TH CENTURY,

00:55:38.535 --> 00:55:40.570
19TH CENTURY, YOU KNOW,

00:55:40.637 --> 00:55:42.806
PRIORITIES, A BIT OF MANIFEST

00:55:42.872 --> 00:55:43.907
DESTINY. WE'RE COMING IN. WE'RE

00:55:43.973 --> 00:55:45.075
GOING TO TAKE THIS LAND. WE'RE

00:55:45.141 --> 00:55:46.910
GOING TO USE THIS LAND. THAT'S

00:55:46.976 --> 00:55:49.212
NOT NECESSARILY HOW THE THE

00:55:49.279 --> 00:55:51.081
MODERN WORLD THINKS, BUT WE

00:55:51.147 --> 00:55:54.984
BUILT OUR 20TH CENTURY. AND IN

00:55:55.051 --> 00:55:57.153
19TH AND 20TH CENTURY

00:55:57.220 --> 00:55:58.254
INFRASTRUCTURE, STARTING WITH

00:55:58.321 --> 00:56:00.356
SOME OF THOSE VIEWS, AND NOW

00:56:00.423 --> 00:56:01.858
WE'RE FACING A FUTURE THAT IS

00:56:01.925 --> 00:56:03.259
GOING TO BE FACING CLIMATE

00:56:03.326 --> 00:56:05.028
CHANGE AND, AND HOW WE ARE

00:56:05.095 --> 00:56:07.530
GOING TO ADAPT TO THE CHANGING

00:56:07.597 --> 00:56:09.466
CLIMATE, MORE FREQUENT STORMS,

00:56:09.532 --> 00:56:14.504
MORE FREQUENT DROUGHTS. I WANT

00:56:14.571 --> 00:56:16.206
TO TALK A LITTLE BIT ABOUT WHAT

00:56:16.272 --> 00:56:18.141
WE AS A DEPARTMENT ARE DOING IN

00:56:18.208 --> 00:56:20.944
THE CALIFORNIA WATER PLAN UNDER

00:56:21.010 --> 00:56:25.248
SB 72 FROM 2025 BY SENATOR

00:56:25.315 --> 00:56:27.150
CABALLERO, WE WERE TASKED WITH,

00:56:27.217 --> 00:56:28.485
AS PART OF THE WATER PLAN,

00:56:28.551 --> 00:56:30.286
DOING A NUMBER OF THINGS. BUT

00:56:30.353 --> 00:56:32.088
CHIEF AMONGST THAT WAS

00:56:32.155 --> 00:56:35.258
IDENTIFYING HOW DO WE SECURE

00:56:35.325 --> 00:56:37.127
SUFFICIENT WATER, WATER

00:56:37.193 --> 00:56:38.928
SUPPLIES TO MEET CALIFORNIA'S

00:56:38.995 --> 00:56:41.064
NEEDS, THOSE NEEDS, BOTH FROM A

00:56:41.131 --> 00:56:42.932
GROWING POPULATION BUT ALSO

00:56:42.999 --> 00:56:44.334
FROM THE IMPACTS OF CLIMATE

00:56:44.400 --> 00:56:45.902
CHANGE, WHERE WE ARE EXPECTING

00:56:45.969 --> 00:56:48.638
TO SEE, EXCUSE ME, WHERE WE ARE

00:56:48.705 --> 00:56:52.208
EXPECTING TO SEE REDUCED

00:56:52.275 --> 00:56:54.043
SNOWPACK, MORE OF THE

00:56:54.110 --> 00:56:55.845
PRECIPITATION FALLING AS WATER.

00:56:55.912 --> 00:56:58.081
AND JUST TO GIVE AN EXAMPLE OF

00:56:58.148 --> 00:57:00.016
SOME OF THE SOME OF THE IMPACTS

00:57:00.083 --> 00:57:03.787
WE ARE EXPECTING TO SEE. SO THE

00:57:03.853 --> 00:57:06.289
SB 72 REQUIREMENT WAS IDENTIFY

00:57:06.356 --> 00:57:08.424
HOW WE CAN COME UP WITH AN 9

00:57:08.491 --> 00:57:09.893
MILLION ACRE FEET OF WATER, OF

00:57:09.959 --> 00:57:12.428
NEW WATER. AND WE ARE THEN

00:57:12.495 --> 00:57:14.564
TASKED WITH IDENTIFYING IS 9

00:57:14.631 --> 00:57:15.665
MILLION SUFFICIENT? IS 9

00:57:15.732 --> 00:57:16.933
MILLION THE RIGHT NUMBER? AND

00:57:17.000 --> 00:57:18.134
WE'RE GOING TO BE EVALUATING

00:57:18.201 --> 00:57:21.371
THAT AS WE MOVE FORWARD IN OUR

00:57:21.437 --> 00:57:25.675
ANALYSIS. THAT 9 MILLION IS

00:57:25.742 --> 00:57:27.477
GOING TO COME FROM THE

00:57:27.544 --> 00:57:29.646
DIFFERENT CATEGORIES IDENTIFIED

00:57:29.712 --> 00:57:31.881
FOR YOU ON THE SCREEN. AND THEY

00:57:31.948 --> 00:57:33.750
ARE NOT NEW CATEGORIES. THEY

00:57:33.817 --> 00:57:35.118
ARE NOTHING THAT YOU PROBABLY

00:57:35.185 --> 00:57:36.686
WOULDN'T BE ABLE TO IDENTIFY ON

00:57:36.753 --> 00:57:39.022
YOUR OWN. BUT OUR OUR ADVISORY

00:57:39.088 --> 00:57:40.890
COMMITTEE HAS Kò THESE AS, AS

00:57:40.957 --> 00:57:43.660
THE MAJOR NEW STORAGE RE

00:57:43.726 --> 00:57:46.262
OPERATION OF OUR EXISTING

00:57:46.329 --> 00:57:48.031
RESERVOIR FACILITIES, HOW DO WE

00:57:48.097 --> 00:57:50.099
RETAIN MORE WATER SO THAT WE

00:57:50.166 --> 00:57:53.570
AREN'T REACTING TWO INCOMING

00:57:53.636 --> 00:57:55.371
STORMS INAPPROPRIATELY, EITHER

00:57:55.438 --> 00:57:57.207
FROM A WATER SUPPLY PERSPECTIVE

00:57:57.273 --> 00:57:59.709
OR A FLOOD FLOOD MANAGEMENT

00:57:59.776 --> 00:58:01.878
PERSPECTIVE. INCREASING OUR

00:58:01.945 --> 00:58:04.380
GROUNDWATER RECHARGE. CAPTURING

00:58:04.447 --> 00:58:07.617
STORMWATER. BETTER WATERSHED

00:58:07.684 --> 00:58:09.519
AND FOREST MANAGEMENT, WHICH

00:58:09.586 --> 00:58:11.187
WAS MENTIONED EARLIER IN THE

00:58:11.254 --> 00:58:14.757
HEADWATERS PIECE, CONTINUING

00:58:14.824 --> 00:58:17.660
URBAN WATER CONSERVATION, WATER

00:58:17.727 --> 00:58:19.929
RECYCLING, DESALINATION, NEW

00:58:19.996 --> 00:58:22.732
WAYS OF CONVEYING WATER BOTH

00:58:22.799 --> 00:58:25.268
REGIONALLY AND STATEWIDE WATER

00:58:25.335 --> 00:58:27.437
TRANSFERS. AND THEN ULTIMATELY,

00:58:27.503 --> 00:58:30.273
THE BIG WATER DEMAND REDUCTION,

00:58:30.340 --> 00:58:31.774
WHICH IS BOTH URBAN AND

00:58:31.841 --> 00:58:33.576
AGRICULTURAL WATER. WATER

00:58:33.643 --> 00:58:36.412
REDUCTION. THESE ARE THE KEY

00:58:36.479 --> 00:58:37.847
POINTS THAT THE STATE IS

00:58:37.914 --> 00:58:39.849
LOOKING AT IN OUR CALIFORNIA

00:58:39.916 --> 00:58:41.117
WATER PLAN. AND THAT WATER PLAN

00:58:41.184 --> 00:58:44.354
IS USED AS AN INFORMATIVE

00:58:44.420 --> 00:58:45.722
DOCUMENT FOR LOCAL WATER

00:58:45.788 --> 00:58:48.291
MANAGERS. WE OBVIOUSLY OPERATE

00:58:48.358 --> 00:58:50.493
THE STATE WATER PROJECT AND A

00:58:50.560 --> 00:58:51.728
MAJOR WATER SUPPLY SYSTEM

00:58:51.794 --> 00:58:52.996
THROUGH THE STATE, AND ALL OF

00:58:53.062 --> 00:58:55.498
THOSE LOCAL AGENCIES IN TURN

00:58:55.565 --> 00:58:58.101
OPERATE THEIR OWN SYSTEMS, MANY

00:58:58.167 --> 00:58:59.869
OF WHOM RECEIVE WATER. 27

00:58:59.936 --> 00:59:01.604
MILLION CALIFORNIANS RECEIVE

00:59:01.671 --> 00:59:03.439
SOME PORTION OF THEIR WATER

00:59:03.506 --> 00:59:05.942
FROM THE STATE WATER PROJECTS

00:59:06.009 --> 00:59:11.748
SYSTEM, BUT OUR OUR LOCAL WATER

00:59:11.814 --> 00:59:13.850
MANAGERS REALLY IMPLEMENT THAT

00:59:13.917 --> 00:59:15.351
GREATLY. AND I THINK THAT WAS

00:59:15.418 --> 00:59:17.120
IDENTIFIED IN SOME OF THE COST

00:59:17.186 --> 00:59:23.927
DISCUSSIONS EARLIER. OUR WATER

00:59:23.993 --> 00:59:25.428
PLAN, AND THIS IS NOT THE

00:59:25.495 --> 00:59:27.530
GREATEST OF IMAGES, BUT SIZE

00:59:27.597 --> 00:59:29.365
WISE, WHAT OUR WATER PLAN IS

00:59:29.432 --> 00:59:30.767
DOING SPECIFICALLY WITH REGARD

00:59:30.833 --> 00:59:33.670
TO FINANCING AND WATER

00:59:33.736 --> 00:59:34.704
AFFORDABILITY, WE'RE LOOKING AT

00:59:34.771 --> 00:59:37.640
EACH OF THESE STRATEGIES IN

00:59:37.707 --> 00:59:39.809
UNDER THE LENS OF OF FOUR

00:59:39.876 --> 00:59:41.945
CATEGORIES INFRASTRUCTURE,

00:59:42.011 --> 00:59:44.113
REGULATION, AFFORDABILITY AND

00:59:44.180 --> 00:59:45.882
DATA, AND REALLY, REALLY THE

00:59:45.949 --> 00:59:47.717
ADVISORY COMMITTEE TO THE WATER

00:59:47.784 --> 00:59:50.253
PLAN, WHICH IS A BROAD GROUP OF

00:59:50.320 --> 00:59:53.456
EXPERTS AND PARTICIPANTS, WATER

00:59:53.523 --> 00:59:55.291
MANAGERS, TRIBAL

00:59:55.358 --> 00:59:57.093
REPRESENTATIVES, WE WE HAVE

00:59:57.160 --> 00:59:58.561
REALLY DONE. AND THAT WAS ALSO

00:59:58.628 --> 01:00:01.030
A REQUIREMENT OF RECENT

01:00:01.097 --> 01:00:04.634
LEGISLATION PASSED TO TO TAKE A

01:00:04.701 --> 01:00:08.938
BROAD SPECTRUM APPROACH TO, TO

01:00:09.005 --> 01:00:10.039
COMPILING THE WATER PLAN. AND

01:00:10.106 --> 01:00:11.474
AGAIN, IT'S A FIVE YEAR PROCESS.

01:00:11.541 --> 01:00:13.109
SO IT IS A VERY IN-DEPTH

01:00:13.176 --> 01:00:14.043
PROCESS THAT WE'RE WE'RE

01:00:14.110 --> 01:00:17.180
ENGAGED IN. THE NEXT ONE WILL

01:00:17.246 --> 01:00:19.515
BE COMPLETED IN 2028 AND WILL

01:00:19.582 --> 01:00:21.551
COME OUT AT THE END OF 2028.

01:00:21.617 --> 01:00:22.986
AND IT'S GOING TO LOOK AT EACH

01:00:23.052 --> 01:00:24.053
OF THESE STRATEGIES THROUGH

01:00:24.120 --> 01:00:26.255
THESE THROUGH THE LENS OF IS

01:00:26.322 --> 01:00:28.658
THIS IS THIS POSSIBLE? IS THIS

01:00:28.725 --> 01:00:30.059
AFFORDABLE? WHAT ARE THE

01:00:30.126 --> 01:00:31.494
BENEFITS? WHAT ARE THE WHERE

01:00:31.561 --> 01:00:33.262
ARE THE GAPS IN DATA THAT WE

01:00:33.329 --> 01:00:35.231
NEED TO DO THIS TYPE OF WORK?

01:00:35.298 --> 01:00:36.966
SO WE REALLY HOPE THAT THIS

01:00:37.033 --> 01:00:39.836
HELPS ADVISE FUTURE ACTIONS. TO

01:00:39.902 --> 01:00:40.903
ADDRESS THE VERY QUESTION

01:00:40.970 --> 01:00:42.338
YOU'RE ASKING AT THIS COMMITTEE,

01:00:42.405 --> 01:00:44.507
HOW DO WE MOVE FORWARD IN

01:00:44.574 --> 01:00:45.942
FINANCING FUTURE WATER NEEDS?

01:00:46.009 --> 01:00:47.410
HOW DO WE ADDRESS THE CHANGES

01:00:47.477 --> 01:00:53.116
THAT WE'RE SEEING? I DON'T

01:00:53.182 --> 01:00:54.984
THINK THIS IS GOING TO BE

01:00:55.051 --> 01:00:55.985
NECESSARY, BECAUSE I THINK A

01:00:56.052 --> 01:00:57.887
LOT OF PEOPLE WILL SPEAK TO

01:00:57.954 --> 01:00:59.288
THIS ALSO. BUT SIMPLY PUT, THAT

01:00:59.355 --> 01:01:04.660
THERE THERE IS NO DO NOTHING

01:01:04.727 --> 01:01:06.562
OPTION IN THIS. SOMETHING NEEDS

01:01:06.629 --> 01:01:08.631
TO BE DONE. THERE ARE IMPACTS

01:01:08.698 --> 01:01:10.566
FROM INACTION, AS WE'VE TALKED

01:01:10.633 --> 01:01:12.568
ABOUT WITH REGARD TO AGING

01:01:12.635 --> 01:01:13.369
INFRASTRUCTURE. SOMETHING HAS

01:01:13.436 --> 01:01:15.038
TO HAPPEN. YOU CAN'T JUST KEEP

01:01:15.104 --> 01:01:19.409
PUTTING BAND-AIDS ON ON ACTUAL

01:01:19.475 --> 01:01:21.277
INFRASTRUCTURE WITH REGARD TO

01:01:21.344 --> 01:01:22.278
CLIMATE CHANGE. WE'RE SEEING

01:01:22.345 --> 01:01:23.679
THOSE IMPACTS NOW. WE'RE SEEING

01:01:23.746 --> 01:01:27.316
THE THE CHANGES WE NEED. DOING

01:01:27.383 --> 01:01:29.952
NOTHING IS NOT AN OPTION. AND,

01:01:30.019 --> 01:01:32.422
AND I WANT TO KIND OF LEAVE

01:01:32.488 --> 01:01:34.891
THAT THERE FOR YOU, BUT

01:01:34.957 --> 01:01:38.528
HOPEFULLY, HOPEFULLY YOU'VE

01:01:38.594 --> 01:01:39.729
HEARD WHAT ARE THE PROBLEMS?

01:01:39.796 --> 01:01:40.730
WHAT ARE THE STRESSORS? WHAT

01:01:40.797 --> 01:01:42.432
ARE WE FACING? WHAT ARE THE

01:01:42.498 --> 01:01:44.534
COSTS? I WANT TO HOPE TO LEAVE

01:01:44.600 --> 01:01:46.436
YOU WITH. WE ARE LOOKING AT

01:01:46.502 --> 01:01:47.870
DOING THIS. WE ARE LOOKING AT

01:01:47.937 --> 01:01:50.373
ADDRESSING THIS. WE ARE WORKING

01:01:50.440 --> 01:01:52.875
STATEWIDE WITH EXPERTS TO

01:01:52.942 --> 01:01:54.177
IDENTIFY WHAT ARE THE WHAT ARE

01:01:54.243 --> 01:01:55.178
THE RECOMMENDATIONS? WHAT ARE

01:01:55.244 --> 01:01:56.179
THE RECOMMENDATIONS THAT THE

01:01:56.245 --> 01:01:58.047
NEXT WATER PLAN IS GOING TO

01:01:58.114 --> 01:01:59.715
MAKE TO THE LEGISLATURE, TO

01:01:59.782 --> 01:02:02.652
WATER MANAGERS, TO THE STATE,

01:02:02.718 --> 01:02:04.754
BROADLY, THAT NEED TO HAPPEN

01:02:04.821 --> 01:02:10.526
FOR NEXT STEPS, WHICH INCLUDE

01:02:10.593 --> 01:02:11.961
JUST RECENTLY, THE STATE WATER

01:02:12.028 --> 01:02:13.763
RESOURCES CONTROL BOARD

01:02:13.830 --> 01:02:15.932
APPROVED THE BAY-DELTA WATER

01:02:15.998 --> 01:02:17.733
QUALITY CONTROL PLAN AND

01:02:17.800 --> 01:02:19.168
INCLUDED THE HEALTHY RIVERS AND

01:02:19.235 --> 01:02:20.937
LANDSCAPES PROPOSAL, WHICH WAS

01:02:21.003 --> 01:02:24.207
BASICALLY MAKE SURE THAT IF YOU

01:02:24.273 --> 01:02:26.476
ARE IMPROVING HABITAT, IF YOU

01:02:26.542 --> 01:02:28.578
ARE IMPROVING FLOODPLAINS, IF

01:02:28.644 --> 01:02:30.713
YOU ARE DOING ADDITIONAL WORK

01:02:30.780 --> 01:02:35.051
TO HAVE THE SAME BENEFITS AS TO

01:02:35.118 --> 01:02:36.819
SPECIES, THAT IS A BENEFICIAL

01:02:36.886 --> 01:02:40.389
PURPOSE. ALSO, THE SITES

01:02:40.456 --> 01:02:43.693
RESERVOIR PROJECT JUST RECEIVED

01:02:43.759 --> 01:02:45.595
ITS APPROVAL PERMIT FROM THE

01:02:45.661 --> 01:02:47.296
STATE WATER RESOURCES CONTROL

01:02:47.363 --> 01:02:50.133
BOARD AS WELL, WHICH IS ANOTHER

01:02:50.199 --> 01:02:52.068
PIECE OF THE THE BROADER PUZZLE

01:02:52.135 --> 01:02:53.402
THAT WE'RE LOOKING AT TOO. AND

01:02:53.469 --> 01:02:55.872
THOSE ARE JUST TWO NOT

01:02:55.938 --> 01:02:57.373
INSIGNIFICANT EXAMPLES OF

01:02:57.440 --> 01:02:58.774
THINGS THAT ARE BEING DONE. BUT

01:02:58.841 --> 01:03:01.344
I HOPE TO LEAVE YOU WITH

01:03:01.410 --> 01:03:02.311
COLLECTIVELY, WATER MANAGERS

01:03:02.378 --> 01:03:04.547
ARE INVESTIGATING THIS, ARE

01:03:04.614 --> 01:03:06.315
MOVING FORWARD AND ARE

01:03:06.382 --> 01:03:08.518
ADDRESSING THIS. AND AS, AS WE

01:03:08.584 --> 01:03:10.987
AS THE STATE ARE, ARE HOPING TO

01:03:11.053 --> 01:03:15.458
HELP GUIDE THAT PROCESS. THANK

01:03:15.525 --> 01:03:16.759
YOU SO MUCH, MR. KIMCHI. I

01:03:16.826 --> 01:03:20.329
APPRECIATE IT. AND WE HAVE

01:03:20.396 --> 01:03:25.001
KARLA NEMETH, WHO IS NOW THE

01:03:25.067 --> 01:03:27.170
HEAD OF AQUA. SO, KARLA, I KNOW

01:03:27.236 --> 01:03:28.638
YOU'RE WITH US REMOTELY AND

01:03:28.704 --> 01:03:30.072
HOPEFULLY WE'LL SEE YOU ON OUR

01:03:30.139 --> 01:03:35.511
SCREEN. YEAH I AM, GOOD MORNING.

01:03:35.578 --> 01:03:39.115
CHAIRS AND CARILLO I, I AM

01:03:39.182 --> 01:03:40.883
KARLA NEMETH. I'M THE EXECUTIVE

01:03:40.950 --> 01:03:42.652
DIRECTOR OF THE ASSOCIATION OF

01:03:42.718 --> 01:03:45.955
CALIFORNIA WATER AGENCIES. WE

01:03:46.022 --> 01:03:48.057
REPRESENT MORE THAN 470 PUBLIC

01:03:48.124 --> 01:03:50.927
WATER AGENCIES REALLY IN ALL

01:03:50.993 --> 01:03:53.829
CORNERS OF THE STATE, LARGE AND

01:03:53.896 --> 01:03:55.665
SMALL. A REAL DIVERSITY OF

01:03:55.731 --> 01:03:58.201
NEEDS AND INTERESTS. SO YOU CAN

01:03:58.267 --> 01:04:00.002
IMAGINE, YOU KNOW, IN

01:04:00.069 --> 01:04:02.638
CALIFORNIA, HAVING OUR PUBLIC

01:04:02.705 --> 01:04:05.007
WATER AGENCIES SPEAK WITH ONE

01:04:05.074 --> 01:04:07.210
VOICE CAN AT TIMES BE

01:04:07.276 --> 01:04:08.945
CHALLENGING. BUT THE ONE THING

01:04:09.011 --> 01:04:11.480
THAT IS VERY UNITING FOR ALL OF

01:04:11.547 --> 01:04:14.383
US IS AFFORDABILITY. SO I'M

01:04:14.450 --> 01:04:16.285
VERY GRATEFUL THAT YOU'RE

01:04:16.352 --> 01:04:19.055
TAKING THE TIME TO, TO DIG INTO

01:04:19.121 --> 01:04:22.325
THESE ISSUES. WE VIEW

01:04:22.391 --> 01:04:23.492
CALIFORNIA'S GENERAL CHALLENGE

01:04:23.559 --> 01:04:26.963
WITH AFFORDABILITY AS WATER, AS

01:04:27.029 --> 01:04:28.431
REALLY THE THIRD LEG OF THE

01:04:28.497 --> 01:04:30.166
STOOL, HOUSING, ENERGY AND

01:04:30.233 --> 01:04:32.368
WATER. ALL OF THOSE ARE VERY

01:04:32.435 --> 01:04:34.170
BASIC NEEDS THAT CALIFORNIANS

01:04:34.237 --> 01:04:36.405
HAVE TO LIVE AND FLOURISH HERE.

01:04:36.472 --> 01:04:40.309
AND SO WE'RE EAGER TO START

01:04:40.376 --> 01:04:41.744
THIS DISCUSSION TODAY AND

01:04:41.811 --> 01:04:44.380
REALLY STAND READY TO SUPPLY

01:04:44.447 --> 01:04:46.415
MORE INFORMATION AS AS THIS

01:04:46.482 --> 01:04:49.318
BODY CONTINUES TO DELIBERATE, I

01:04:49.385 --> 01:04:53.289
WANT TO PICK UP ON I THINK IT

01:04:53.356 --> 01:04:55.791
WAS CASEY SHIMKUS, HIS LAST

01:04:55.858 --> 01:04:59.061
SLIDE. I BELIEVE THAT WITHOUT A

01:04:59.128 --> 01:05:01.931
CLEAR STRATEGY AROUND WATER

01:05:01.998 --> 01:05:03.032
INVESTMENT, THERE'S NO DOUBT IN

01:05:03.099 --> 01:05:05.534
MY MIND THAT COSTS WILL

01:05:05.601 --> 01:05:08.738
SKYROCKET. IT'S NOT AN IF. IT'S

01:05:08.804 --> 01:05:11.307
IT'S AN IS. AND OUR CHALLENGE

01:05:11.374 --> 01:05:14.477
IS WHAT ARE THOSE CLEAR

01:05:14.543 --> 01:05:15.911
STRATEGIES AND HOW DO WE START

01:05:15.978 --> 01:05:17.313
MOVING SOME OF THOSE CLEAR

01:05:17.380 --> 01:05:19.181
STRATEGIES IN THE CONTEXT OF A

01:05:19.248 --> 01:05:23.085
PRETTY COMPLEX PICTURE, WE DID

01:05:23.152 --> 01:05:26.389
SUBMIT A LETTER THAT GOES

01:05:26.455 --> 01:05:28.157
THROUGH A LOT OF THE THEMES.

01:05:28.224 --> 01:05:29.659
YOU'VE HEARD FROM OTHER

01:05:29.725 --> 01:05:31.761
PANELISTS THAT REALLY FRAMES UP

01:05:31.827 --> 01:05:33.562
THE ISSUE FROM AQUA'S

01:05:33.629 --> 01:05:34.997
PERSPECTIVE, BUT I WANT TO JUST

01:05:35.064 --> 01:05:38.601
TOUCH ON A FEW MORE POINTS THAT

01:05:38.668 --> 01:05:43.606
I THINK REALLY BEAR. MOST

01:05:43.673 --> 01:05:45.441
IMPORTANT CONSIDERATION MOVING

01:05:45.508 --> 01:05:49.412
FORWARD. ONE FOR FOR

01:05:49.478 --> 01:05:50.880
CALIFORNIA'S WATER RATEPAYERS

01:05:50.946 --> 01:05:53.382
AND LOCAL GOVERNMENTS. THEY

01:05:53.449 --> 01:05:58.421
PICK UP THE TAB FOR 80%, 84% OF

01:05:58.487 --> 01:06:00.923
OUR WATER INFRASTRUCTURE

01:06:00.990 --> 01:06:02.458
TREATMENT AND DELIVERY COSTS IN

01:06:02.525 --> 01:06:05.261
THE STATE. YOU HEARD FROM A

01:06:05.328 --> 01:06:07.396
PREVIOUS SPEAKER FOR PICK,

01:06:07.463 --> 01:06:09.899
REALLY TOUCHING ON SOME OF THE

01:06:09.965 --> 01:06:12.068
CONSTRAINTS ON HOW LOCAL WATER

01:06:12.134 --> 01:06:14.236
AGENCIES CAN USE THOSE

01:06:14.303 --> 01:06:16.772
RATEPAYER PAYER DOLLARS AND

01:06:16.839 --> 01:06:18.541
LOCAL LOCAL REVENUES, THINGS

01:06:18.607 --> 01:06:20.743
LIKE CONNECTION FEES AND

01:06:20.810 --> 01:06:25.047
PROPERTY TAXES. AND SO I THINK

01:06:25.114 --> 01:06:28.284
FOR, FOR FOR MANY YEARS, OUR

01:06:28.351 --> 01:06:32.588
PUBLIC WATER AGENCIES COULD

01:06:32.655 --> 01:06:36.525
WORK MAYBE WITH ACCEPTABLE

01:06:36.592 --> 01:06:38.361
AFFORDABILITY INSIDE THE

01:06:38.427 --> 01:06:40.529
CONTEXT OF THOSE CONSTRAINTS.

01:06:40.596 --> 01:06:43.065
BUT WHEN WE DO PILE ON THE, THE

01:06:43.132 --> 01:06:45.935
REAL CHALLENGES OF, OF AGING

01:06:46.001 --> 01:06:47.403
INFRASTRUCTURE COMBINED WITH

01:06:47.470 --> 01:06:49.705
MORE, MORE WEATHER, WHIPLASH,

01:06:49.772 --> 01:06:52.375
MORE EXTREMES, I THINK THAT

01:06:52.441 --> 01:06:54.910
WHOLE, THAT WHOLE PACKAGE

01:06:54.977 --> 01:06:57.413
BECOMES A LOT MORE CHALLENGING

01:06:57.480 --> 01:07:00.983
TO MAINTAIN WATER RATES THAT

01:07:01.050 --> 01:07:05.020
ENABLE WATER AGENCIES TO BE TO,

01:07:05.087 --> 01:07:07.490
TO OFFER WATER AT AFFORDABLE

01:07:07.556 --> 01:07:09.358
RATES THROUGHOUT THEIR

01:07:09.425 --> 01:07:12.795
COMMUNITIES. JUST FOR A LITTLE

01:07:12.862 --> 01:07:16.265
MORE CONTEXT, US, EPA PUT OUT

01:07:16.332 --> 01:07:20.870
IN 2021 THAT CALIFORNIA HAD AN

01:07:20.936 --> 01:07:22.271
$84 BILLION INFRASTRUCTURE NEED

01:07:22.338 --> 01:07:25.174
OVER THE NEXT 20 YEARS JUST FOR

01:07:25.241 --> 01:07:27.309
DRINKING WATER. AND THAT WAS

01:07:27.376 --> 01:07:29.478
2021. AND I THINK, YOU KNOW,

01:07:29.545 --> 01:07:32.715
OUR UNDERSTANDING OF THE

01:07:32.782 --> 01:07:35.251
ACCELERATION OF OF WARMING

01:07:35.317 --> 01:07:36.652
CONDITIONS, THE ROLE THAT

01:07:36.719 --> 01:07:38.854
WARMING TEMPERATURES PLAY ON

01:07:38.921 --> 01:07:41.724
ACTUAL SUPPLY AVAILABILITY,

01:07:41.791 --> 01:07:45.361
EVEN IF WE GET MORE WATER OR

01:07:45.428 --> 01:07:49.298
CONTINUE TO GET PRECIPITATION,

01:07:49.365 --> 01:07:50.733
AND IT'S COMING MORE AS RAIN

01:07:50.800 --> 01:07:53.235
THAN AS SNOW. THE REALITY IS

01:07:53.302 --> 01:07:55.805
ALSO TEMPERATURE HAS A DRYING

01:07:55.871 --> 01:07:57.573
EFFECT ON ALL OF OUR SYSTEMS.

01:07:57.640 --> 01:08:00.075
SO EVEN IF IT IF MORE COMES AS

01:08:00.142 --> 01:08:01.911
RAIN, THERE WILL BE LESS THAT

01:08:01.977 --> 01:08:04.346
IS AVAILABLE TO MANAGE FOR

01:08:04.413 --> 01:08:06.582
PEOPLE, THE ECONOMY AND THE

01:08:06.649 --> 01:08:09.185
ENVIRONMENT. AND SO THAT $84

01:08:09.251 --> 01:08:12.021
BILLION JUST ON DRINKING WATER,

01:08:12.087 --> 01:08:14.156
YOU KNOW, IS A DATA POINT FROM

01:08:14.223 --> 01:08:15.357
FIVE YEARS AGO. AND I THINK WE

01:08:15.424 --> 01:08:17.760
CAN ALSO GENERALLY SENSE THAT

01:08:17.827 --> 01:08:19.862
ALL OF THAT IS, IS ACCELERATING.

01:08:19.929 --> 01:08:21.664
THAT'S A PORTION OF THE COSTS.

01:08:21.730 --> 01:08:24.934
BUT EVEN COSTS WRIT LARGE ARE

01:08:25.000 --> 01:08:28.170
ACCELERATING AT AT A RAPID PACE.

01:08:28.237 --> 01:08:30.005
A COUPLE OF AFFORDABILITY

01:08:30.072 --> 01:08:34.343
STRATEGIES THAT OR FRAMING THAT.

01:08:34.410 --> 01:08:37.146
I THINK WE NEED TO DEVELOP THIS,

01:08:37.213 --> 01:08:40.049
THIS CLEAR STRATEGY FOR FOR

01:08:40.115 --> 01:08:41.484
WATER INFRASTRUCTURE IN THE

01:08:41.550 --> 01:08:44.019
STATE IS I THINK WE NEED TO

01:08:44.086 --> 01:08:45.821
UPFRONT ACKNOWLEDGE THE

01:08:45.888 --> 01:08:46.889
INTERCONNECTEDNESS OF MANY OF

01:08:46.956 --> 01:08:50.526
OUR WATER SUPPLY SOURCES. WE

01:08:50.593 --> 01:08:52.294
AGREE AQUA AGREES

01:08:52.361 --> 01:08:54.830
WHOLEHEARTEDLY WITH WITH THE

01:08:54.897 --> 01:08:57.299
NOTION THAT OUR OUR HEADWATERS

01:08:57.366 --> 01:09:00.903
REALLY HAVE BECOME FINANCING

01:09:00.970 --> 01:09:03.839
ORPHANS. AND ALL THE CHALLENGES

01:09:03.906 --> 01:09:08.477
ON ON WATER RATEPAYERS ARE

01:09:08.544 --> 01:09:10.312
EXPONENTIALLY MORE DIFFICULT.

01:09:10.379 --> 01:09:12.481
AND SOME OF THESE HEADWATER

01:09:12.548 --> 01:09:13.916
COMMUNITIES WHERE THEY HAVE

01:09:13.983 --> 01:09:16.752
VERY OLD SYSTEMS FROM THE 1800S,

01:09:16.819 --> 01:09:18.554
THESE WOODEN FLUMES THAT ARE

01:09:18.621 --> 01:09:21.090
VERY VULNERABLE TO WILDFIRE,

01:09:21.156 --> 01:09:26.161
THEY'RE VULNERABLE TO RAIN LAND

01:09:26.228 --> 01:09:29.365
MOVEMENT RELATIVE TO TO RAIN

01:09:29.431 --> 01:09:31.667
EVENTS AFTER WILDFIRE. AND THEY

01:09:31.734 --> 01:09:34.737
ALSO HAPPEN TO SERVE SERVICE

01:09:34.803 --> 01:09:36.906
AREAS THAT ARE VERY SPARSELY

01:09:36.972 --> 01:09:38.374
POPULATED. SO YOU CAN IMAGINE

01:09:38.440 --> 01:09:39.775
THAT SORT OF AFFORDABILITY

01:09:39.842 --> 01:09:41.577
CURVE IN SOME OF OUR RURAL

01:09:41.644 --> 01:09:43.746
COMMUNITIES IN IN OUR

01:09:43.812 --> 01:09:46.649
HEADWATERS JUST BECOMES

01:09:46.715 --> 01:09:49.885
EXTREMELY STEEP. SO

01:09:49.952 --> 01:09:51.453
AFFORDABILITY STRATEGIES THAT

01:09:51.520 --> 01:09:54.223
TAKE THAT INTO ACCOUNT ARE, ARE

01:09:54.290 --> 01:09:55.691
REALLY IMPORTANT FOR MOVING

01:09:55.758 --> 01:09:57.793
FORWARD BECAUSE THOSE HEADWATER

01:09:57.860 --> 01:09:59.929
CONDITIONS ARE VERY MUCH

01:09:59.995 --> 01:10:02.097
INTERCONNECTED TO WHAT HAPPENS

01:10:02.164 --> 01:10:03.699
DOWNSTREAM THAT THAT SUPPLIES

01:10:03.766 --> 01:10:05.734
THE MORE POPULATED PARTS OF OUR

01:10:05.801 --> 01:10:07.503
STATE, BE THAT SORT OF

01:10:07.570 --> 01:10:10.072
AGRICULTURE IN OUR IN THE

01:10:10.139 --> 01:10:11.807
SACRAMENTO VALLEY OR THE SAN

01:10:11.874 --> 01:10:14.043
JOAQUIN VALLEY, YOU KNOW, ALL

01:10:14.109 --> 01:10:16.178
THE WAY OUT TO OUR OUR URBAN

01:10:16.245 --> 01:10:17.646
COMMUNITIES THAT TEND TO BE

01:10:17.713 --> 01:10:19.715
MORE DEVELOPED ALONG THE COASTS.

01:10:19.782 --> 01:10:23.352
AND I WOULD SAY WE HAVE SORT OF

01:10:23.419 --> 01:10:25.487
IN ADDITION TO OUR BIG SYSTEMS

01:10:25.554 --> 01:10:28.357
IN THOSE AREAS AND, AND PLACES

01:10:28.424 --> 01:10:30.593
LIKE THE NORTH NORTHERN BAY

01:10:30.659 --> 01:10:32.061
AREA ALL THE WAY UP THE

01:10:32.127 --> 01:10:33.696
NORTHERN COAST, YOU KNOW, WE

01:10:33.762 --> 01:10:35.230
JUST HAVE THESE SORT OF

01:10:35.297 --> 01:10:36.332
CIRCUMSTANCES THAT MAYBE AT A

01:10:36.398 --> 01:10:37.766
SMALLER SCALE, BUT THEY'RE

01:10:37.833 --> 01:10:39.935
STILL REALLY IMPORTANT FOR

01:10:40.002 --> 01:10:41.337
THOSE COMMUNITIES THAT LIVE

01:10:41.403 --> 01:10:44.273
THERE. SO FOLKS IN NAPA AND

01:10:44.340 --> 01:10:46.175
SONOMA AND MENDOCINO COUNTIES

01:10:46.241 --> 01:10:47.776
AND LAKE COUNTY AND, AND

01:10:47.843 --> 01:10:49.278
FURTHER NORTH, THEY ALL HAVE

01:10:49.345 --> 01:10:52.514
HEADWATER ISSUES THAT TEND TO,

01:10:52.581 --> 01:10:53.983
IF WE DON'T ADDRESS THOSE

01:10:54.049 --> 01:10:55.384
HEADWATER ISSUES, THEY HAVE

01:10:55.451 --> 01:10:56.485
DOWNSTREAM EFFECTS THAT ARE

01:10:56.552 --> 01:10:59.054
ALSO CHALLENGING FOR MANAGING

01:10:59.121 --> 01:11:01.123
WATER SUPPLIES. SO

01:11:01.190 --> 01:11:02.591
ACKNOWLEDGING THE

01:11:02.658 --> 01:11:04.026
INTERCONNECTEDNESS OF OUR

01:11:04.093 --> 01:11:06.629
SURFACE WATER SYSTEMS THAT MANY

01:11:06.695 --> 01:11:08.764
OF WHICH ORIGINATE IN THE

01:11:08.831 --> 01:11:10.132
SIERRA NEVADA, BUT OTHER

01:11:10.199 --> 01:11:13.369
MOUNTAIN RANGES, HOW THOSE ARE

01:11:13.435 --> 01:11:15.638
MANAGED REALLY MATTERS TO HOW

01:11:15.704 --> 01:11:17.339
WE MANAGE OUR GROUNDWATER

01:11:17.406 --> 01:11:19.842
BASINS, FOR EXAMPLE. IT REALLY

01:11:19.908 --> 01:11:23.512
MATTERS TO OUR ABILITY TO

01:11:23.579 --> 01:11:25.247
RECYCLE WATER IN A IN AN

01:11:25.314 --> 01:11:27.850
AFFORDABLE WAY. AND WHAT ALSO

01:11:27.916 --> 01:11:31.754
MATTERS IS HOW WE INTERCONNECT

01:11:31.820 --> 01:11:33.188
IMPORTANT NEEDS THAT WE HAVE TO

01:11:33.255 --> 01:11:36.091
USE WATER MORE EFFICIENTLY. SO

01:11:36.158 --> 01:11:37.493
CONSERVATION IS HUGELY

01:11:37.559 --> 01:11:40.429
IMPORTANT. OUR 2018

01:11:40.496 --> 01:11:42.931
CONSERVATION AS A WAY OF LIFE

01:11:42.998 --> 01:11:46.168
LEGISLATION PUT US ON A PATH TO

01:11:46.235 --> 01:11:48.737
TO HAVE REDUCTIONS OVER CERTAIN

01:11:48.804 --> 01:11:51.907
PERIODS OF TIME 2035 2040

01:11:51.974 --> 01:11:54.710
FOCUSED ON URBAN AREAS FOCUSED

01:11:54.777 --> 01:11:57.413
LARGELY ON OUTDOOR WATER USE,

01:11:57.479 --> 01:12:00.849
WHICH IS WHERE OUR URBAN AREAS

01:12:00.916 --> 01:12:02.685
HAVE THE MOST WATER USE,

01:12:02.751 --> 01:12:04.153
DEALING WITH THINGS LIKE SYSTEM

01:12:04.219 --> 01:12:05.921
WATER LOSSES, DEALING WITH

01:12:05.988 --> 01:12:08.457
THINGS LIKE OUR COMMERCIAL

01:12:08.524 --> 01:12:10.659
AREAS AND THE WAY THAT THEY

01:12:10.726 --> 01:12:15.264
THEY USE WATER. SO WE HAVE

01:12:15.330 --> 01:12:17.499
ESTIMATES THAT OUR CONSERVATION

01:12:17.566 --> 01:12:20.002
AS A WAY OF LIFE POTENTIALLY

01:12:20.069 --> 01:12:23.806
ESSENTIALLY GENERATES 400,000

01:12:23.872 --> 01:12:25.407
TO 500,000 ACRE FEET, SORT OF

01:12:25.474 --> 01:12:27.543
IN THE CONTEXT OF THIS WARMING

01:12:27.609 --> 01:12:31.880
CLIMATE AND IN THE CONTEXT OF.

01:12:31.947 --> 01:12:33.649
WHAT'S WHAT'S OUR NEW CHARGE

01:12:33.716 --> 01:12:36.919
VIA SB 72 IN THE WATER PLAN, I

01:12:36.985 --> 01:12:38.353
MENTIONED THAT BECAUSE AS A

01:12:38.420 --> 01:12:41.557
WATER COMMUNITY, WE HAD SOME

01:12:41.623 --> 01:12:43.492
ORIGINAL ESTIMATES OF THE COST

01:12:43.559 --> 01:12:45.561
OF THOSE CONSERVATION PROGRAMS

01:12:45.627 --> 01:12:48.864
IN THE 3 TO $4 BILLION RANGE, I

01:12:48.931 --> 01:12:50.933
THINK WE DON'T FULLY KNOW

01:12:50.999 --> 01:12:52.334
EXACTLY HOW MUCH IT'S GOING TO

01:12:52.401 --> 01:12:55.437
COST TO ADAPT TO TO ACHIEVE

01:12:55.504 --> 01:12:59.575
THOSE ADAPTATIONS IN, IN 2035

01:12:59.641 --> 01:13:01.777
AND IN 2040. SO THAT'S

01:13:01.844 --> 01:13:03.579
SOMETHING THAT AQUA IS PAYING

01:13:03.645 --> 01:13:05.714
CLOSE ATTENTION TO AND REALLY

01:13:05.781 --> 01:13:07.950
STARTING TO UNDERSTAND NOT JUST

01:13:08.016 --> 01:13:10.385
THE COST OF THOSE CONSERVATION

01:13:10.452 --> 01:13:12.888
PROGRAMS, BUT THE FOLLOW ON

01:13:12.955 --> 01:13:16.191
EFFECT THAT INCREASED LEVELS OF

01:13:16.258 --> 01:13:17.659
WATER USE EFFICIENCY HAVE ON

01:13:17.726 --> 01:13:20.429
THE AFFORDABILITY OF OTHER

01:13:20.496 --> 01:13:21.930
SUPPLIES WE KNOW WE NEED TO

01:13:21.997 --> 01:13:24.066
INVEST IN. AND I THINK THEREIN

01:13:24.133 --> 01:13:26.702
LIES THE CHALLENGE. WE DO NEED

01:13:26.769 --> 01:13:29.104
TO DO ALL OF THESE COMPONENT

01:13:29.171 --> 01:13:31.273
PIECES. WE DO NEED TO STABILIZE

01:13:31.340 --> 01:13:33.175
OUR SURFACE WATER SUPPLIES AND

01:13:33.242 --> 01:13:34.543
DEAL WITH THE AGING

01:13:34.610 --> 01:13:37.079
INFRASTRUCTURE. THAT'S THAT'S

01:13:37.146 --> 01:13:40.649
THAT'S CHALLENGING THOSE THOSE

01:13:40.716 --> 01:13:42.284
CONVEYANCE AND STORAGE SYSTEMS.

01:13:42.351 --> 01:13:44.286
WE DO NEED TO INVEST IN OUR

01:13:44.353 --> 01:13:45.387
GROUNDWATER BASINS. WE DO NEED

01:13:45.454 --> 01:13:47.222
TO INVEST IN RECYCLE WATER, AND

01:13:47.289 --> 01:13:49.324
WE NEED TO USE WATER MORE

01:13:49.391 --> 01:13:50.659
EFFICIENTLY. SO WHEN YOU PUT

01:13:50.726 --> 01:13:52.227
ALL OF THOSE THINGS TOGETHER,

01:13:52.294 --> 01:13:54.263
IT'S THOSE UPWARD PRESSURES ON

01:13:54.329 --> 01:13:56.865
WATER RATES ARE ARE ENORMOUS.

01:13:56.932 --> 01:13:59.067
AND AS I MENTIONED, FELT MORE

01:13:59.134 --> 01:14:01.136
ACUTELY IN THOSE COMMUNITIES

01:14:01.203 --> 01:14:02.638
WHERE THERE REALLY AREN'T THE

01:14:02.704 --> 01:14:04.406
RATEPAYERS TO, TO REALLY SPREAD,

01:14:04.473 --> 01:14:07.309
SPREAD THAT KIND OF COST. I

01:14:07.376 --> 01:14:08.410
THINK THE OTHER PIECE OF IT

01:14:08.477 --> 01:14:10.112
THAT WE NEED TO ACKNOWLEDGE IS

01:14:10.179 --> 01:14:12.581
THAT ESPECIALLY SOME OF OUR

01:14:12.648 --> 01:14:14.817
BIGGER SYSTEMS, THEY DO AFFORD

01:14:14.883 --> 01:14:18.053
MULTIPLE BENEFITS. OUR BIG

01:14:18.120 --> 01:14:19.655
BUILT WATER CONVEYANCE SYSTEM

01:14:19.721 --> 01:14:20.956
PLAYS AN IMPORTANT ROLE IN

01:14:21.023 --> 01:14:23.525
FLOOD PROTECTION. YOU KNOW,

01:14:23.592 --> 01:14:25.294
HERE IN THE GREATER SACRAMENTO

01:14:25.360 --> 01:14:27.062
AREA. BUT ALL THE WAY UP AND

01:14:27.129 --> 01:14:29.565
DOWN OUR BIG SACRAMENTO AND SAN

01:14:29.631 --> 01:14:31.400
JOAQUIN SYSTEM. AND THEN AT THE

01:14:31.466 --> 01:14:35.737
LOCAL LEVEL, THEY ARE OUR WATER

01:14:35.804 --> 01:14:37.873
SYSTEMS ALSO PROVIDE FLOOD

01:14:37.940 --> 01:14:40.409
CONTROL WHEN WE HAVE BIG, BIG

01:14:40.475 --> 01:14:41.877
STORMS EVENT STORM EVENTS

01:14:41.944 --> 01:14:43.345
COMING THROUGH CALIFORNIA. AND

01:14:43.412 --> 01:14:46.515
I THINK THIS YEAR WILL BE WILL

01:14:46.582 --> 01:14:49.751
OFFER SOME INTERESTING AN

01:14:49.818 --> 01:14:50.819
INTERESTING LOOK AT THE

01:14:50.886 --> 01:14:52.588
CHALLENGES. BUT MORE

01:14:52.654 --> 01:14:54.456
OPTIMISTICALLY, THE

01:14:54.523 --> 01:14:56.191
OPPORTUNITIES WE HAVE TO

01:14:56.258 --> 01:14:59.094
CAPTURE MORE OF OUR STORM

01:14:59.161 --> 01:15:01.263
EVENTS, PROTECT PUBLIC SAFETY,

01:15:01.330 --> 01:15:04.199
BUT CAPTURE THOSE STORM SYSTEMS

01:15:04.266 --> 01:15:05.267
BETTER, MORE EFFICIENTLY SO

01:15:05.334 --> 01:15:07.803
THAT WE CAN USE THEM WHEN

01:15:07.870 --> 01:15:10.672
DROUGHT RETURNS. SO AGAIN, I

01:15:10.739 --> 01:15:12.441
THINK ACKNOWLEDGING THE

01:15:12.507 --> 01:15:13.408
INTERCONNECTEDNESS OF ALL OF

01:15:13.475 --> 01:15:15.344
OUR SYSTEMS NEEDS TO BE PART OF

01:15:15.410 --> 01:15:17.479
A DISCUSSION AROUND

01:15:17.546 --> 01:15:19.648
AFFORDABILITY STRATEGIES. THE

01:15:19.715 --> 01:15:23.218
SECOND PIECE IS NO SURPRISE.

01:15:23.285 --> 01:15:25.053
DELAY MAKES EVERYTHING MORE

01:15:25.120 --> 01:15:28.290
COSTLY. AND ONE OF OUR BIG

01:15:28.357 --> 01:15:30.058
EXAMPLES OF THAT IS ANDERSON

01:15:30.125 --> 01:15:32.361
DAM, A SEISMIC RETROFIT PROJECT.

01:15:32.427 --> 01:15:33.695
THIS IS IN THE SANTA CLARA

01:15:33.762 --> 01:15:36.899
VALLEY. IT'S AN IMPORTANT WATER

01:15:36.965 --> 01:15:38.367
STORAGE SYSTEM, BUT ALSO FLOOD

01:15:38.433 --> 01:15:41.270
PROTECTION SYSTEM. THIS IS A

01:15:41.336 --> 01:15:43.405
PROJECT THAT'S BEEN WORKING ON

01:15:43.472 --> 01:15:45.507
PERMITS FOR 20 YEARS, 13

01:15:45.574 --> 01:15:47.376
DIFFERENT STATE AND FEDERAL

01:15:47.442 --> 01:15:49.845
AGENCIES. THE COST OF THAT

01:15:49.912 --> 01:15:51.446
PROJECT HAS JUMPED IN THE LAST

01:15:51.513 --> 01:15:55.250
THREE YEARS, FROM 3.2 TO ABOUT

01:15:55.317 --> 01:15:57.085
$4.2 BILLION. BUT 900 MILLION

01:15:57.152 --> 01:16:00.022
OF THAT OVER THE LAST 20 YEARS

01:16:00.088 --> 01:16:02.424
HAS BEEN SPENT ON PERMITTING

01:16:02.491 --> 01:16:04.693
ENGINEERING AND DESIGN. ALL

01:16:04.760 --> 01:16:05.560
IMPORTANT THINGS THAT WE HAVE

01:16:05.627 --> 01:16:10.332
TO DO. BUT WHEN WHEN OUR

01:16:10.399 --> 01:16:14.002
PERMITTING PROCESSES TAKE 20

01:16:14.069 --> 01:16:16.138
YEARS, YOU CAN SEE THAT THOSE

01:16:16.204 --> 01:16:20.809
COSTS ADD UP. AND I THINK IT'S

01:16:20.876 --> 01:16:22.277
IMPORTANT FOR US AS A STATE TO

01:16:22.344 --> 01:16:24.146
LOOK AT WHAT ARE THE THINGS

01:16:24.212 --> 01:16:27.849
THAT WE CAN DO TO STREAMLINE

01:16:27.916 --> 01:16:30.018
THOSE PROCESSES, STREAMLINE

01:16:30.085 --> 01:16:34.189
THOSE PROCESSES THAT REALLY

01:16:34.256 --> 01:16:36.692
HELP US DEAL WITH SERIAL KINDS

01:16:36.758 --> 01:16:41.330
OF PERMITTING CONDITIONS THAT.

01:16:41.396 --> 01:16:44.933
GENERATE CHANGES THAT GENERATE

01:16:45.000 --> 01:16:46.835
REDUNDANT WORK THAT NEEDS TO BE

01:16:46.902 --> 01:16:49.304
DONE AT THE LOCAL AGENCY LEVEL,

01:16:49.371 --> 01:16:51.406
AND THE COSTS OF WHICH ARE

01:16:51.473 --> 01:16:53.608
EXCLUSIVELY BORNE BY OUR WATER

01:16:53.675 --> 01:16:56.178
RATEPAYERS. AND THEN FINALLY, I

01:16:56.244 --> 01:17:00.415
THINK THE THIRD STRATEGY IS HOW

01:17:00.482 --> 01:17:02.217
DO WE THINK ABOUT THE WAYS IN

01:17:02.284 --> 01:17:05.187
WHICH OUR FUNDING SOURCES AND

01:17:05.253 --> 01:17:07.689
OUR FUNDING STRATEGIES? THESE

01:17:07.756 --> 01:17:10.158
ARE BOND INITIATIVES AND OUR

01:17:10.225 --> 01:17:13.028
STATE REVOLVING FUNDS WORK IN

01:17:13.095 --> 01:17:18.800
THE CONTEXT OF. OUR PERMITTING

01:17:18.867 --> 01:17:20.635
PROCESSES THAT CAN BE LENGTHY

01:17:20.702 --> 01:17:23.839
OR WORK IN THE CONTEXT OF

01:17:23.905 --> 01:17:25.240
PROJECTS THAT NEED TO HAVE

01:17:25.307 --> 01:17:28.110
MULTIPLE FUNDING SOURCES. IT

01:17:28.176 --> 01:17:29.578
CAN BE VERY CHALLENGING AT THE

01:17:29.644 --> 01:17:34.249
LOCAL AGENCY LEVEL TO ALIGN AN

01:17:34.316 --> 01:17:36.451
ABILITY TO USE YOUR RATEPAYER,

01:17:36.518 --> 01:17:37.986
RATEPAYER DOLLARS AND GOING OUT

01:17:38.053 --> 01:17:41.156
TO AN ELECTION AS AS REQUIRED

01:17:41.223 --> 01:17:43.325
BY PROP 218, SORT OF CLEARING

01:17:43.392 --> 01:17:45.460
THAT HURDLE, MATCHING THAT UP

01:17:45.527 --> 01:17:46.862
IN A TIMELINE WITH THE

01:17:46.928 --> 01:17:48.730
AVAILABILITY OF STATE DOLLARS

01:17:48.797 --> 01:17:50.399
AND MATCHING THAT UP IN A

01:17:50.465 --> 01:17:51.566
TIMELINE WITH AN AVAILABILITY

01:17:51.633 --> 01:17:55.170
OF FEDERAL DOLLARS, IT IT IS

01:17:55.237 --> 01:17:57.305
NOT AN EFFICIENT WAY TO PLAN

01:17:57.372 --> 01:17:59.841
FOR BIG CAPITAL PROJECTS. AND

01:17:59.908 --> 01:18:01.376
SO I THINK THERE'S AN ALIGNMENT

01:18:01.443 --> 01:18:03.845
THERE THAT WE CAN DO IN THE

01:18:03.912 --> 01:18:07.082
NEAR TERM ACROSS EXISTING STATE

01:18:07.149 --> 01:18:08.884
FUNDING SOURCES. BUT I ALSO

01:18:08.950 --> 01:18:11.019
THINK, YOU KNOW, WE HAVE REAL

01:18:11.086 --> 01:18:14.956
CHALLENGES AROUND AROUND BOND

01:18:15.023 --> 01:18:16.825
DOLLARS AND BOND DOLLARS THAT

01:18:16.892 --> 01:18:20.695
GO OUT. AND IT TAKES IT TAKES A

01:18:20.762 --> 01:18:23.231
LONG TIME TO, TO SEE THOSE

01:18:23.298 --> 01:18:25.734
PROJECTS REALIZED. I CAN'T HELP

01:18:25.801 --> 01:18:28.603
BUT COMMENT ON THE SITES

01:18:28.670 --> 01:18:30.439
RESERVOIR PROJECT, WHICH IS, AS

01:18:30.505 --> 01:18:32.040
CASEY MENTIONED, JUST RECEIVED

01:18:32.107 --> 01:18:36.211
ITS FINAL PERMIT LAST NIGHT. IF

01:18:36.278 --> 01:18:38.747
I CAN JUST KIND OF PUT MY MY

01:18:38.814 --> 01:18:40.882
FORMER HAT BACK ON OR JUST

01:18:40.949 --> 01:18:43.752
CLAIM DIRECTOR EMERITUS STATUS

01:18:43.819 --> 01:18:46.621
FOR A BRIEF MOMENT, THERE WAS A

01:18:46.688 --> 01:18:52.127
LOT OF ENTHUSIASM AND

01:18:52.194 --> 01:18:54.162
EXCITEMENT IN 2014 WHEN PROP

01:18:54.229 --> 01:18:56.364
ONE PASSED, AND WATER STORAGE

01:18:56.431 --> 01:18:59.201
WAS A PART OF THAT, AND PUBLIC

01:18:59.267 --> 01:19:00.669
DOLLARS GOING FOR PUBLIC

01:19:00.735 --> 01:19:02.104
BENEFITS THAT WERE ASSOCIATED

01:19:02.170 --> 01:19:06.108
WITH WATER STORAGE, AND THE BIG

01:19:06.174 --> 01:19:07.876
EXCITEMENT, OF COURSE, AS I'M

01:19:07.943 --> 01:19:09.244
SURE YOU CAN RELATE TO, IS

01:19:09.311 --> 01:19:11.480
THOSE FUNDS WERE CONTINUOUSLY

01:19:11.546 --> 01:19:12.614
APPROPRIATED, WHICH FELT LIKE

01:19:12.681 --> 01:19:15.784
AN IMPORTANT STEP FORWARD IN

01:19:15.851 --> 01:19:17.986
WATER INFRASTRUCTURE FUNDING.

01:19:18.053 --> 01:19:20.555
BUT I THINK WHAT HAPPENED WAS

01:19:20.622 --> 01:19:23.358
WE HAD A VERY COMPLEX PROCESS

01:19:23.425 --> 01:19:29.097
FOR BOTH SORTING THROUGH THE

01:19:29.164 --> 01:19:32.033
ANALYSIS THAT NEEDED TO SUPPORT

01:19:32.100 --> 01:19:34.469
DECISION MAKING BY THE

01:19:34.536 --> 01:19:35.937
CALIFORNIA WATER COMMISSION.

01:19:36.004 --> 01:19:38.907
AND WE HAD AN ORIGINAL SORT OF

01:19:38.974 --> 01:19:41.042
SET OF PROJECTS, IF YOU WILL,

01:19:41.109 --> 01:19:43.145
THAT SORT OF AUTOMATICALLY

01:19:43.211 --> 01:19:44.746
QUALIFIED. BUT IN THE COURSE OF

01:19:44.813 --> 01:19:47.449
THE LAST, YOU KNOW, 12 YEARS.

01:19:47.516 --> 01:19:48.650
AND OF COURSE, THAT PROGRAM

01:19:48.717 --> 01:19:51.453
KIND OF PREDATES SGMA, RIGHT?

01:19:51.520 --> 01:19:53.255
SO WHEN SIGMA WAS PASSED,

01:19:53.321 --> 01:19:57.559
SUDDENLY WE HAD THIS IMMEDIATE

01:19:57.626 --> 01:19:59.728
SENSE AND DESIRE TO ACKNOWLEDGE

01:19:59.794 --> 01:20:01.229
OUR UNDERGROUND AQUIFERS FOR

01:20:01.296 --> 01:20:04.366
WHAT THEY ARE, WHICH IS REALLY

01:20:04.432 --> 01:20:06.168
CRITICAL WATER STORAGE

01:20:06.234 --> 01:20:07.736
INFRASTRUCTURE. THAT'S 12 TIMES

01:20:07.802 --> 01:20:10.505
THE SIZE OF OUR SURFACE WATER

01:20:10.572 --> 01:20:12.007
RESERVOIRS. IT PLAYS A REALLY

01:20:12.073 --> 01:20:13.408
IMPORTANT ROLE IN WATER

01:20:13.475 --> 01:20:15.210
SECURITY. BUT THAT PROGRAM,

01:20:15.277 --> 01:20:17.779
THAT 2.7 BILLION FOR PUBLIC

01:20:17.846 --> 01:20:19.548
BENEFITS, WAS NOT REALLY ABLE

01:20:19.614 --> 01:20:22.751
TO SHIFT OFF OF A PARTICULAR

01:20:22.817 --> 01:20:26.721
CONSTRUCT IN A TIMELY WAY. AND,

01:20:26.788 --> 01:20:28.924
AND I THINK ABOUT IF CALIFORNIA

01:20:28.990 --> 01:20:31.693
INVESTED THAT 2.7 BILLION IN A

01:20:31.760 --> 01:20:34.596
DIFFERENT WAY IN, IN A KIND OF

01:20:34.663 --> 01:20:36.064
FINANCING STRUCTURE THAT

01:20:36.131 --> 01:20:38.600
ENABLED US TO REALIZE INTEREST

01:20:38.667 --> 01:20:41.503
ON THOSE DOLLARS VERSUS

01:20:41.570 --> 01:20:42.637
CONTINUOUSLY TRY AND COVER THE

01:20:42.704 --> 01:20:45.106
COST OF INFLATION, WE WOULD BE

01:20:45.173 --> 01:20:47.275
IN A BETTER POSITION TODAY TO

01:20:47.342 --> 01:20:48.710
FUND THE THINGS THAT WE NEED TO

01:20:48.777 --> 01:20:51.213
FUND, THAT ARE RESPONSIVE TO

01:20:51.279 --> 01:20:53.415
CLIMATE CONDITIONS, THAT ARE

01:20:53.481 --> 01:20:54.783
RESPONSIVE TO THE

01:20:54.849 --> 01:20:56.318
INTERCONNECTEDNESS OF, OF OUR

01:20:56.384 --> 01:20:58.386
OUR WATER SUPPLY SYSTEMS, AND

01:20:58.453 --> 01:21:00.956
DO IT IN A WAY THAT IS MORE,

01:21:01.022 --> 01:21:02.757
MORE AFFORDABLE TO WATER

01:21:02.824 --> 01:21:04.526
RATEPAYERS IN THE STATE. I

01:21:04.593 --> 01:21:06.528
THINK WE NEED TO LEARN FROM THE

01:21:06.595 --> 01:21:08.830
THINGS THAT WE'VE TRIED AND HOW

01:21:08.897 --> 01:21:12.067
THEY HOLD UP IN THE CONTEXT OF

01:21:12.133 --> 01:21:14.236
SOME REALLY IMPORTANT CHANGE

01:21:14.302 --> 01:21:16.071
CONDITIONS WITH CLIMATE AND A

01:21:16.137 --> 01:21:17.472
CHANGED REGULATORY ENVIRONMENT

01:21:17.539 --> 01:21:19.274
WITH SGMA, FOR EXAMPLE. AND I

01:21:19.341 --> 01:21:21.876
THINK I HAVE TREMENDOUS RESPECT

01:21:21.943 --> 01:21:24.312
FOR MY MY COLLEAGUES ON THE

01:21:24.379 --> 01:21:25.413
WATER COMMISSION. I THINK

01:21:25.480 --> 01:21:26.548
THEY'VE THEY'VE FOLLOWED THE

01:21:26.615 --> 01:21:28.984
LETTER OF THE LAW AND. BUT IT

01:21:29.050 --> 01:21:30.986
HAS BEEN A LABORIOUS PROCESS,

01:21:31.052 --> 01:21:32.854
AND I THINK WE CAN LEARN FROM

01:21:32.921 --> 01:21:34.756
THAT GOING FORWARD. SO WITH

01:21:34.823 --> 01:21:36.358
THAT, I'LL CONCLUDE MY REMARKS

01:21:36.424 --> 01:21:38.526
AND JUST THANK YOU FOR ALLOWING

01:21:38.593 --> 01:21:39.794
ME THE OPPORTUNITY TO SPEAK

01:21:39.861 --> 01:21:42.397
WITH YOU THIS MORNING. THANK

01:21:42.464 --> 01:21:46.768
YOU SO MUCH FOR THE FOR EACH OF

01:21:46.835 --> 01:21:48.770
THE WITNESSES TO BE HERE AND

01:21:48.837 --> 01:21:51.706
AND TO BRING A DIFFERENT

01:21:51.773 --> 01:21:53.875
COMPONENT AS IT RELATES TO

01:21:53.942 --> 01:21:55.277
FINANCING AND WHAT FOLKS ARE UP

01:21:55.343 --> 01:21:57.112
AGAINST. WE HAVE TIME FOR A FEW

01:21:57.178 --> 01:21:58.980
QUESTIONS. I'D LIKE TO TURN IT

01:21:59.047 --> 01:22:01.416
OVER TO COUNCILMEMBER CARRILLO.

01:22:01.483 --> 01:22:03.218
THANK YOU. THANK YOU TO THE

01:22:03.285 --> 01:22:05.020
PANELISTS FOR THEIR

01:22:05.086 --> 01:22:07.155
PRESENTATIONS. A COUPLE OF

01:22:07.222 --> 01:22:09.724
QUESTIONS AND COMMENTS. WHAT

01:22:09.791 --> 01:22:11.860
WHAT COULD POSSIBLY LOCAL WATER

01:22:11.926 --> 01:22:16.865
AGENCIES DO TO PLAN FOR FUTURE

01:22:16.931 --> 01:22:20.368
WATER? THE FEES THAT THEY

01:22:20.435 --> 01:22:24.339
CHARGE TO BE BASED ON EITHER

01:22:24.406 --> 01:22:25.740
GOING OUT TO THE VOTERS TO

01:22:25.807 --> 01:22:29.411
INCREASE THE WATER FEES? AND

01:22:29.477 --> 01:22:31.713
THAT SEEMS TO BE THAT IT'S NOT

01:22:31.780 --> 01:22:33.548
GOING TO BE VERY POPULAR, AS

01:22:33.615 --> 01:22:34.716
YOU KNOW, FOR WHAT'S GOING ON

01:22:34.783 --> 01:22:37.686
WITH THE COST OF LIVING,

01:22:37.752 --> 01:22:39.921
INCREASING THOSE FEES, AND WHAT

01:22:39.988 --> 01:22:41.856
IS IT THAT THEY CAN POSSIBLY DO

01:22:41.923 --> 01:22:44.159
TO BETTER PLAN FOR FUTURE

01:22:44.225 --> 01:22:46.294
IMPROVEMENTS ON INFRASTRUCTURE?

01:22:46.361 --> 01:22:47.762
THANK YOU FOR MENTIONING THE

01:22:47.829 --> 01:22:49.230
THE MONEY THAT IS AVAILABLE

01:22:49.297 --> 01:22:50.665
THROUGH THE DIFFERENT GRANT

01:22:50.732 --> 01:22:51.666
ALLOCATIONS AND THINGS LIKE

01:22:51.733 --> 01:22:56.371
THAT. AND IS THERE A MECHANISM

01:22:56.438 --> 01:22:59.040
THAT ENSURES THAT RURAL AREAS

01:22:59.107 --> 01:23:01.042
ARE GETTING SOME OF THAT MONEY

01:23:01.109 --> 01:23:02.143
FOR THE IMPROVEMENTS THAT THEY

01:23:02.210 --> 01:23:04.713
NEED TO DO, AS OPPOSED TO WHAT

01:23:04.779 --> 01:23:05.814
URBAN AREAS GET? LIKE, YOU KNOW,

01:23:05.880 --> 01:23:07.916
THE L.A. BASIN, YOU TALKED

01:23:07.982 --> 01:23:09.317
ABOUT THE L.A. COUNTY, THE THE

01:23:09.384 --> 01:23:10.618
MEASURE THAT WAS PASSED BY

01:23:10.685 --> 01:23:12.587
MEASURE, I BELIEVE IT WAS. BUT

01:23:12.654 --> 01:23:14.089
IN L.A. COUNTY IS SO BIG. AND

01:23:14.155 --> 01:23:15.490
THERE'S ALSO RURAL AREAS IN

01:23:15.557 --> 01:23:16.925
NORTH L.A. COUNTY, THE AREAS

01:23:16.991 --> 01:23:19.094
THAT I REPRESENT, AND WE ALWAYS

01:23:19.160 --> 01:23:20.462
QUESTION IF WE GET OUR FAIR

01:23:20.528 --> 01:23:23.031
SHARE OF WHAT'S AVAILABLE. I

01:23:23.098 --> 01:23:24.532
THINK I ASKED TWO QUESTIONS IN

01:23:24.599 --> 01:23:26.267
ONE. IF YOU NEED ME TO CLARIFY,

01:23:26.334 --> 01:23:29.571
JUST LET ME KNOW. YEAH, THANK

01:23:29.637 --> 01:23:32.440
YOU FOR YOUR QUESTION. YES. I

01:23:32.507 --> 01:23:35.643
MEAN, THE SITUATION FOR SMALL

01:23:35.710 --> 01:23:38.146
AND RURAL COMMUNITY WATER

01:23:38.213 --> 01:23:39.948
SYSTEMS IS EXTREMELY

01:23:40.014 --> 01:23:42.450
CHALLENGING. IT IS UNREALISTIC

01:23:42.517 --> 01:23:44.185
THAT MOST OF THEM COULD AFFORD

01:23:44.252 --> 01:23:45.687
TO PAY FOR IT, GIVEN THEIR

01:23:45.754 --> 01:23:50.058
SMALL RATEPAYER BASIS. SO I, I

01:23:50.125 --> 01:23:51.459
DON'T KNOW WHAT'S POSSIBLE, BUT

01:23:51.526 --> 01:23:54.095
TO ME, THE THE OBVIOUS SOURCE

01:23:54.162 --> 01:23:55.830
WOULD BE SOME KIND OF FURTHER

01:23:55.897 --> 01:24:00.068
STATE FUNDING TO, TO MAKE THOSE,

01:24:00.135 --> 01:24:02.937
YOU KNOW, TO, TO, TO ALLOW

01:24:03.004 --> 01:24:04.439
THOSE SYSTEMS TO MAKE THE

01:24:04.506 --> 01:24:08.042
NEEDED INVESTMENTS. I SO IN

01:24:08.109 --> 01:24:12.747
TERMS OF AFFORDABILITY FOR, FOR

01:24:12.814 --> 01:24:16.017
WATER AGENCIES GENERALLY, YOU

01:24:16.084 --> 01:24:17.719
KNOW, THE, THE RATE, THE LOW

01:24:17.786 --> 01:24:19.187
INCOME RATEPAYER ASSISTANCE

01:24:19.254 --> 01:24:21.089
PROGRAMS THAT I KNOW OF THAT

01:24:21.156 --> 01:24:24.626
ARE OUT THERE CURRENTLY, EITHER

01:24:24.692 --> 01:24:28.563
PREEXISTED PROP 218 OR ARE

01:24:28.630 --> 01:24:31.166
USING NON RATE REVENUE TO, TO

01:24:31.232 --> 01:24:33.401
PAY FOR THAT. AND SO SOMETIMES

01:24:33.468 --> 01:24:35.336
AN AGENCY WILL HAVE PROPERTY

01:24:35.403 --> 01:24:36.938
THAT THEY CAN LEASE OUT, THEY

01:24:37.005 --> 01:24:38.573
CAN USE FUNDING FROM THOSE

01:24:38.640 --> 01:24:40.108
SOURCES TO PAY FOR THEM. BUT OF

01:24:40.175 --> 01:24:42.610
COURSE THAT DOES NOT APPLY TO

01:24:42.677 --> 01:24:45.079
EVERY AGENCY AND EVERY, EVERY

01:24:45.146 --> 01:24:48.049
SITUATION. SO IT IS EXTREMELY

01:24:48.116 --> 01:24:50.852
CHALLENGING. I MEAN, YOU KNOW,

01:24:50.919 --> 01:24:53.388
TO BE VERY OPTIMISTIC OR I SEE

01:24:53.455 --> 01:24:55.890
SHOOT FOR THE STARS, YOU KNOW,

01:24:55.957 --> 01:24:58.793
REFORMING PROP 218 WOULD BE

01:24:58.860 --> 01:25:00.962
WOULD MAKE A LOT OF THINGS MORE

01:25:01.029 --> 01:25:03.465
POSSIBLE. BUT THAT. YEAH. THANK

01:25:03.531 --> 01:25:07.068
YOU. AND WELL, ONE LAST THING.

01:25:07.135 --> 01:25:09.904
DO YOU BELIEVE THAT IT'S WORTH

01:25:09.971 --> 01:25:11.406
INVESTING IN COVERING THE

01:25:11.473 --> 01:25:12.807
CALIFORNIA AQUEDUCT WITH SOLAR

01:25:12.874 --> 01:25:14.876
PANELS TO HELP EVAPORATION? I

01:25:14.943 --> 01:25:16.177
KNOW THERE'S SOME PILOT PROGRAM

01:25:16.244 --> 01:25:17.545
IN THE CENTRAL VALLEY. IS IT

01:25:17.612 --> 01:25:20.048
WORTH THE INVESTMENT? WELL, THE

01:25:20.114 --> 01:25:22.917
PILOT PROGRAM IN IN TURLOCK HAS

01:25:22.984 --> 01:25:26.488
BEEN QUITE EXPENSIVE FOR THE

01:25:26.554 --> 01:25:28.690
AMOUNT OF CANALS THAT WERE

01:25:28.756 --> 01:25:30.892
COVERED. AND THAT HAD TO DO

01:25:30.959 --> 01:25:32.627
WITH ENGINEERING CHALLENGES

01:25:32.694 --> 01:25:33.795
BECAUSE THEY NEEDED TO BE ABLE

01:25:33.862 --> 01:25:35.897
TO BRING IN EARTHMOVERS TO DO

01:25:35.964 --> 01:25:37.665
REGULAR MAINTENANCE AROUND THE

01:25:37.732 --> 01:25:38.867
CANALS. AND BECAUSE OF THAT,

01:25:38.933 --> 01:25:40.935
THEY HAD TO ESSENTIALLY BUILD

01:25:41.002 --> 01:25:42.704
PILLARS AND PUT THE PANELS UP,

01:25:42.770 --> 01:25:46.007
UP HIGH, WHICH ADDED A HUGE

01:25:46.074 --> 01:25:47.742
AMOUNT OF COST THAT WAS NOT

01:25:47.809 --> 01:25:49.110
ANTICIPATED. SO AT LEAST FOR

01:25:49.177 --> 01:25:51.312
THAT PILOT, IT HAS NOT I MEAN,

01:25:51.379 --> 01:25:53.214
THIS IS A TRIAL, BUT THAT WAS

01:25:53.281 --> 01:25:55.283
NOT COST EFFECTIVE. AND, AND

01:25:55.350 --> 01:25:58.186
SORT OF MAKES ME WONDER IF IT

01:25:58.253 --> 01:26:00.021
WOULD SCALE UP IN A COST

01:26:00.088 --> 01:26:04.692
EFFECTIVE MANNER. ANY OTHER

01:26:04.759 --> 01:26:06.461
MEMBERS? I GOT A COUPLE

01:26:06.528 --> 01:26:10.198
QUESTIONS. SO I WANT TO I WANT

01:26:10.265 --> 01:26:13.301
TO ASK ABOUT BONDING CAPACITY

01:26:13.368 --> 01:26:14.769
AND WHERE THE STATE IS, BECAUSE

01:26:14.836 --> 01:26:16.204
WE'VE SEEN OVER THE PAST COUPLE

01:26:16.271 --> 01:26:17.672
DECADES, IN ORDER TO DO THESE

01:26:17.739 --> 01:26:20.141
CAPITAL IMPROVEMENTS, WE REALLY

01:26:20.208 --> 01:26:21.943
RELIED ON BONDS. SO WHERE ARE

01:26:22.010 --> 01:26:26.614
WE AS IT RELATES TO? OUR

01:26:26.681 --> 01:26:27.649
ABILITY TO GET SOME MORE

01:26:27.715 --> 01:26:30.985
BONDING CAPACITY OR TO GET MORE

01:26:31.052 --> 01:26:34.188
BONDS AS PROTECT? THANK YOU FOR

01:26:34.255 --> 01:26:38.159
THE QUESTION, MADAM CHAIR. I

01:26:38.226 --> 01:26:40.128
THINK I NEED TO START BY FIRST

01:26:40.194 --> 01:26:41.462
POINTING OUT THAT THE STATE IS

01:26:41.529 --> 01:26:43.565
PAYING MORE THAN 7 BILLION, AN

01:26:43.631 --> 01:26:46.100
ESTIMATED MORE THAN

01:26:46.167 --> 01:26:47.535
7,000,000,000 IN 2627 FOR BOND,

01:26:47.602 --> 01:26:49.270
DEBT SERVICE AND FOR THE

01:26:49.337 --> 01:26:53.675
RESOURCES BONDS. THIS IS 1.6

01:26:53.741 --> 01:26:54.776
BILLION IN 2627. AND THIS

01:26:54.842 --> 01:26:55.843
OBVIOUSLY DOESN'T INCLUDE THE

01:26:55.910 --> 01:26:57.245
BONDS THAT WERE JUST APPROVED

01:26:57.312 --> 01:26:59.314
BY VOTERS IN THE ELECTION ON

01:26:59.380 --> 01:27:03.151
TUESDAY. SO THE IT'S DEFINITELY

01:27:03.217 --> 01:27:07.288
A CONSIDERATION HOW MUCH WE CAN

01:27:07.355 --> 01:27:09.857
AND SHOULD DEPEND ON BONDS,

01:27:09.924 --> 01:27:11.626
BECAUSE OBVIOUSLY THE MORE

01:27:11.693 --> 01:27:13.061
BONDS THAT ARE APPROVED, THE

01:27:13.127 --> 01:27:14.862
HIGHER THAT DEBT SERVICE IS, IS

01:27:14.929 --> 01:27:17.031
GOING TO GO. AND IT AT SOME

01:27:17.098 --> 01:27:18.433
POINT, YOU KNOW, IT'S LIKE,

01:27:18.499 --> 01:27:19.567
SHOULD WE BE PAYING THE DEBT

01:27:19.634 --> 01:27:21.436
SERVICE OR USING THAT MONEY FOR

01:27:21.502 --> 01:27:22.837
THE ACTUAL PROJECT? SO IT'S

01:27:22.904 --> 01:27:26.808
SORT OF A FINE, FINE BALANCE. I

01:27:26.874 --> 01:27:28.376
DON'T KNOW IF I REALLY ANSWERED

01:27:28.443 --> 01:27:29.944
YOUR QUESTION. WELL, THAT WAS

01:27:30.011 --> 01:27:31.379
YOU KIND OF SEGUE INTO MY NEXT

01:27:31.446 --> 01:27:33.247
QUESTION, AND THAT IS, HOW HIGH

01:27:33.314 --> 01:27:35.049
IS THE DEBT SERVICE? AND HAVE

01:27:35.116 --> 01:27:36.084
WE REACHED THAT INFLECTION

01:27:36.150 --> 01:27:37.885
POINT? I GUESS THAT'S REALLY

01:27:37.952 --> 01:27:39.787
YEAH, I HAVE TO SAY, I'M NOT

01:27:39.854 --> 01:27:43.291
I'M NOT A AN ECONOMIST IN THIS

01:27:43.358 --> 01:27:44.759
AREA. SO I DON'T WANT TO

01:27:44.826 --> 01:27:45.793
NECESSARILY SPEAK OUT OF TURN,

01:27:45.860 --> 01:27:47.996
BUT WE'RE DEFINITELY OUR DEBT

01:27:48.062 --> 01:27:49.697
SERVICE IS, IS DEFINITELY ON

01:27:49.764 --> 01:27:51.933
THE HIGH, HIGH SIDE AT THE

01:27:52.000 --> 01:27:54.535
MOMENT. AND WE'LL HAVE TO KEEP

01:27:54.602 --> 01:27:57.005
AN EYE ON THAT, PARTICULARLY IN

01:27:57.071 --> 01:27:59.507
LIGHT OF THE ADDITIONAL BONDS

01:27:59.574 --> 01:28:01.476
THAT WE'RE ADDING AS A RESULT

01:28:01.542 --> 01:28:04.212
OF THE ELECTION. SURE, SURE.

01:28:04.278 --> 01:28:05.413
MR. KIMCHE, I HAVE A QUESTION

01:28:05.480 --> 01:28:08.549
FOR YOU. AND AS WE TALK ABOUT

01:28:08.616 --> 01:28:09.651
STRATEGIES GOING FORWARD, AND

01:28:09.717 --> 01:28:12.086
THERE ARE SO MANY DIFFERENT

01:28:12.153 --> 01:28:15.390
PROJECTS THAT WE YOU REFERENCED

01:28:15.456 --> 01:28:19.661
THE DOLLAR FIGURES FOR FOR

01:28:19.727 --> 01:28:20.728
GROUNDWATER RECHARGE. YOU

01:28:20.795 --> 01:28:23.631
MENTIONED DOLLAR FIGURES FOR, I

01:28:23.698 --> 01:28:25.767
THINK THE DAM IMPROVED DAM

01:28:25.833 --> 01:28:29.537
SAFETY. DO YOU FORESEE BECAUSE

01:28:29.604 --> 01:28:31.305
YOU'RE DOING THESE PLANS? AND

01:28:31.372 --> 01:28:33.341
AS I'VE LOOKED INTO THIS AND

01:28:33.408 --> 01:28:34.509
PREPARED FOR THIS HEARING, YOU

01:28:34.575 --> 01:28:36.077
KNOW, WE GOT PLANS FROM ZERO

01:28:36.144 --> 01:28:40.181
FIVE. WE GOT PLANS FROM 22,009,

01:28:40.248 --> 01:28:42.850
2013, 15, YOU KNOW, 21 AND HERE

01:28:42.917 --> 01:28:44.485
WE ARE IN. 26 AND YOU'RE

01:28:44.552 --> 01:28:48.122
WORKING ON. 28 FANTASTIC. BUT

01:28:48.189 --> 01:28:52.126
PLANS DO NOT. A INFRASTRUCTURE

01:28:52.193 --> 01:28:53.461
CONSTRUCTION MAKE. SO MY

01:28:53.528 --> 01:28:55.329
QUESTION TO YOU IS HOW DO YOU

01:28:55.396 --> 01:28:57.432
FORESEE PRIORITIZING PROJECTS?

01:28:57.498 --> 01:28:59.734
AND ESPECIALLY WHEN, AS YOU HAD

01:28:59.801 --> 01:29:01.436
YOU STARTED WITH YOUR DOOMSDAY

01:29:01.502 --> 01:29:03.538
SLIDE AND I BELIEVE ME, I TOOK

01:29:03.604 --> 01:29:07.608
IT ALL IN. BUT WHAT ARE WHAT IS

01:29:07.675 --> 01:29:09.110
DWR GOING TO DO AS IT RELATES

01:29:09.177 --> 01:29:11.546
TO PRIORITIZING AND ESPECIALLY

01:29:11.612 --> 01:29:13.314
GIVEN THE BACKDROP OF CLIMATE

01:29:13.381 --> 01:29:15.116
CHANGE AND RECEIVING WATER IN

01:29:15.183 --> 01:29:22.290
DIFFERENT WAYS. SURE. THANK YOU.

01:29:22.356 --> 01:29:23.424
WHAT WE'RE FOCUSING ON RIGHT

01:29:23.491 --> 01:29:26.661
NOW WITH THIS NEXT 2028

01:29:26.728 --> 01:29:28.129
CALIFORNIA WATER PLAN. AND

01:29:28.196 --> 01:29:29.564
MAYBE I'LL TAKE A HALF A STEP

01:29:29.630 --> 01:29:31.432
BACK AND SAY YOU REFERENCE A

01:29:31.499 --> 01:29:32.633
LOT OF THE HISTORIC PLANS AND

01:29:32.700 --> 01:29:34.635
PLANNING EFFORTS, AND EACH ONE

01:29:34.702 --> 01:29:36.537
OF THOSE DOES BUILD ON IT. AND

01:29:36.604 --> 01:29:37.905
WE LEARN WHAT WAS MISSING FROM

01:29:37.972 --> 01:29:39.974
ONE AND WHAT WAS. AND SO WE, WE

01:29:40.041 --> 01:29:42.043
LIKE TO THINK WE ARE IMPROVING

01:29:42.110 --> 01:29:43.478
AS WE MOVE FORWARD WITH OUR

01:29:43.544 --> 01:29:46.447
PLANNING EFFORTS. BUT YOU ASKED

01:29:46.514 --> 01:29:47.882
SPECIFICALLY ABOUT

01:29:47.949 --> 01:29:48.983
PRIORITIZATION, AND THAT'S WHAT

01:29:49.050 --> 01:29:50.384
WE'RE HOPING TO DO BY BY

01:29:50.451 --> 01:29:51.452
EVALUATING THE VARIOUS

01:29:51.519 --> 01:29:54.021
STRATEGIES OF GROUNDWATER

01:29:54.088 --> 01:29:55.757
CONSERVATION, SURFACE STORAGE,

01:29:55.823 --> 01:29:57.625
HOW WE ARE UTILIZING, UTILIZING

01:29:57.692 --> 01:30:00.828
OUR EXISTING SYSTEM. WHEN WE

01:30:00.895 --> 01:30:03.698
EVALUATE THAT, YOU CAN BEGIN TO

01:30:03.765 --> 01:30:06.567
ESSENTIALLY SCORE. THE STRATEGY.

01:30:06.634 --> 01:30:08.770
IS THIS ONE FEASIBLE? WHICH ONE

01:30:08.836 --> 01:30:10.872
IS MORE FEASIBLE? WHICH ONE IS

01:30:10.938 --> 01:30:13.441
IS MORE REGULATORILY FEASIBLE?

01:30:13.508 --> 01:30:15.176
BUT DOES IT HAVE A COST THAT'S

01:30:15.243 --> 01:30:17.411
GOING TO BE THAT DISCUSSION

01:30:17.478 --> 01:30:20.815
THAT THEN WOULD ADVISE PROJECTS.

01:30:20.882 --> 01:30:22.517
SO THAT'S SO THERE'S LIKE TWO

01:30:22.583 --> 01:30:24.952
LEVELS OF PRIORITIZATION I SEE.

01:30:25.019 --> 01:30:27.789
ONE IS IDENTIFYING NOT

01:30:27.855 --> 01:30:29.590
NECESSARILY PRIORITIZING BUT

01:30:29.657 --> 01:30:34.862
IDENTIFYING. WHAT WORKS UNDER

01:30:34.929 --> 01:30:37.565
WHAT SCENARIOS IF COST IS NOT A

01:30:37.632 --> 01:30:40.468
FACTOR. BUT THIS IF COST IS A

01:30:40.535 --> 01:30:42.003
FACTOR, THEN YOU KNOW, LOOKING

01:30:42.069 --> 01:30:43.671
AT THAT, BUT THEN EVALUATING

01:30:43.738 --> 01:30:45.406
THE LOCAL PROJECTS OR THE STATE

01:30:45.473 --> 01:30:51.245
AND LOCAL PROJECTS IN THAT LENS.

01:30:51.312 --> 01:30:53.347
EITHER TO GUIDE FUTURE STATE

01:30:53.414 --> 01:30:54.816
INVESTMENT, BE THAT BONDS OR

01:30:54.882 --> 01:30:58.419
GENERAL FUND DOLLARS OR LOCAL

01:30:58.486 --> 01:31:00.321
INVESTMENTS, OFTENTIMES WITH

01:31:00.388 --> 01:31:02.290
WITH LOCAL BONDING MEASURES AND

01:31:02.356 --> 01:31:03.825
THE LIKES OF THAT. THAT'S

01:31:03.891 --> 01:31:06.360
REALLY WHAT, WHAT WE'RE LOOKING

01:31:06.427 --> 01:31:08.863
AT OUR PLANNING PROCESS DOING

01:31:08.930 --> 01:31:10.631
AND, AND HELPING TO MAKE THOSE

01:31:10.698 --> 01:31:12.066
DECISIONS, NOT NECESSARILY

01:31:12.133 --> 01:31:14.302
IMPOSING A DECISION, BUT

01:31:14.368 --> 01:31:15.670
PROVIDING THE DETAIL, THE

01:31:15.736 --> 01:31:17.138
BACKGROUND, THE INFORMATION AND

01:31:17.205 --> 01:31:20.708
THE GUIDANCE AS TO WHERE WHERE

01:31:20.775 --> 01:31:22.510
LOCAL AGENCIES MAY WANT TO GO.

01:31:22.577 --> 01:31:24.445
AND I KNOW YOU'VE GOT SOME THAT

01:31:24.512 --> 01:31:25.847
THAT MIGHT HAVE SOME THOUGHTS

01:31:25.913 --> 01:31:27.949
HERE TODAY TOO, BUT THAT'S

01:31:28.015 --> 01:31:30.117
REALLY HOW WE'RE, WE'RE VIEWING

01:31:30.184 --> 01:31:32.153
THE, THE NEED AND HOW THIS NEXT

01:31:32.220 --> 01:31:33.754
LEVEL OF PLANNING IS, IS

01:31:33.821 --> 01:31:36.591
FOCUSING. SO I'M GOING TO MAKE

01:31:36.657 --> 01:31:39.427
MY PITCH. I'M LOOKING FOR THE

01:31:39.493 --> 01:31:40.595
BEST BANG FOR OUR BUCK, THE

01:31:40.661 --> 01:31:42.396
MOST URGENT NEED. HOW CAN WE

01:31:42.463 --> 01:31:43.598
ADDRESS IT FOR THE BEST COST?

01:31:43.664 --> 01:31:45.399
AND I KNOW THAT THAT'S NOT

01:31:45.466 --> 01:31:46.767
ROCKET SCIENCE. BUT AS I SAID,

01:31:46.834 --> 01:31:48.502
WE'VE DONE A LOT OF PLANNING

01:31:48.569 --> 01:31:50.638
OVER THE YEARS AND I THINK

01:31:50.705 --> 01:31:52.440
CRUNCH TIME HAS COME AND WE

01:31:52.506 --> 01:31:54.075
REALLY NEED TO GET DOWN TO

01:31:54.141 --> 01:31:55.309
ACTUALLY MAKING THESE

01:31:55.376 --> 01:31:57.845
INVESTMENTS. AND I THINK IF WE

01:31:57.912 --> 01:31:58.980
PRIORITIZE AND SHOW WHERE WE'RE

01:31:59.046 --> 01:32:00.348
GETTING THE BEST BANG FOR OUR

01:32:00.414 --> 01:32:01.949
BUCK, WE'RE GOING TO GET THERE

01:32:02.016 --> 01:32:03.150
A WHOLE LOT FASTER WITH FOLKS

01:32:03.217 --> 01:32:04.986
LIKE US THAT WANT TO IMPLEMENT

01:32:05.052 --> 01:32:06.454
POLICY BUT HAVE TO GET

01:32:06.520 --> 01:32:07.922
REELECTED. AND, AND WE WANT TO

01:32:07.989 --> 01:32:09.090
MAKE SURE THAT WE'RE SERVING

01:32:09.156 --> 01:32:10.958
THE PUBLIC IN THE BEST WAY THAT

01:32:11.025 --> 01:32:12.226
WE CAN. I'M NOT SAYING ANYTHING

01:32:12.293 --> 01:32:13.961
I'M SURE NONE OF YOU DON'T

01:32:14.028 --> 01:32:15.463
DISAGREE WITH. BUT THE TIME IS

01:32:15.529 --> 01:32:17.999
NOW. AND SO I REALLY AM SO

01:32:18.065 --> 01:32:19.500
APPRECIATIVE OF YOU BEING HERE

01:32:19.567 --> 01:32:20.902
AND LENDING TO THE DISCUSSION

01:32:20.968 --> 01:32:22.703
BECAUSE YOU ARE IN THE TRENCHES

01:32:22.770 --> 01:32:24.772
ON THESE TOPICS EVERY DAY. AND

01:32:24.839 --> 01:32:25.940
AND WE'RE GOING TO CONTINUE

01:32:26.007 --> 01:32:27.341
THAT DISCUSSION. ANYBODY ELSE,

01:32:27.408 --> 01:32:29.577
BEFORE WE MOVE ON TO THE NEXT

01:32:29.644 --> 01:32:31.045
PANEL? GREAT. THANK YOU SO MUCH.

01:32:31.112 --> 01:32:34.181
AND LET US MAINTAIN CONTINUED

01:32:34.248 --> 01:32:36.717
DISCUSSIONS. WE'RE HERE FOR YOU.

01:32:36.784 --> 01:32:38.185
ALL RIGHT. LET'S GET THE NEXT

01:32:38.252 --> 01:32:41.756
PANEL COMING. WE'RE GOING TO

01:32:41.822 --> 01:32:43.357
HEAR FROM THE LOCAL AGENCIES.

01:32:43.424 --> 01:32:44.625
NOW. WE'VE TALKED ABOUT YOU.

01:32:44.692 --> 01:32:46.427
NOW IT'S TIME FOR YOU TO COME

01:32:46.494 --> 01:32:48.629
FORWARD. WE'VE GOT MAZZUCA AND

01:32:48.696 --> 01:32:52.533
CHRISTINE COMPTON AND MICHAEL

01:32:52.600 --> 01:32:55.803
COLON. OH COLON CIANO. I'M

01:32:55.870 --> 01:32:57.038
GOING TO GET IT RIGHT BEFORE

01:32:57.104 --> 01:32:58.839
THE END OF THE HEARING, I

01:32:58.906 --> 01:32:59.874
PROMISE, WHO I BELIEVE IS

01:32:59.941 --> 01:33:03.044
COMING TO US REMOTELY. OKAY, SO

01:33:03.110 --> 01:33:08.015
WHO ARE WE GOING TO START WITH?

01:33:08.082 --> 01:33:10.885
OKAY. MR. COLANTUONO, WHO IS

01:33:10.952 --> 01:33:11.953
REMOTELY WE'RE GOING TO TURN

01:33:12.019 --> 01:33:16.324
THE THE SCREEN OVER TO YOU.

01:33:16.390 --> 01:33:23.264
WELCOME. ARE YOU HERE? SORRY

01:33:23.331 --> 01:33:25.666
ABOUT THAT. HEAD ON MUTE. OKAY,

01:33:25.733 --> 01:33:28.235
OKAY. GOOD MORNING, MADAM CHAIR.

01:33:28.302 --> 01:33:29.904
AND MR. CHAIR, THANK YOU FOR

01:33:29.971 --> 01:33:31.105
THE OPPORTUNITY TO PRESENT THIS

01:33:31.172 --> 01:33:32.907
MORNING. I AM A LOCAL

01:33:32.974 --> 01:33:34.308
GOVERNMENT LAWYER WITH

01:33:34.375 --> 01:33:36.110
PARTICULAR EXPERTISE IN THE

01:33:36.177 --> 01:33:37.611
REVENUE SIDE OF MUNICIPAL

01:33:37.678 --> 01:33:39.347
FINANCE, AND I HAVE BOTH

01:33:39.413 --> 01:33:40.414
ADVISED CITIES, COUNTIES AND

01:33:40.481 --> 01:33:41.482
SPECIAL DISTRICTS ON THESE

01:33:41.549 --> 01:33:44.051
TOPICS AND LITIGATED THEM. AND

01:33:44.118 --> 01:33:45.786
YOUR STAFF HAS ASKED ME TO

01:33:45.853 --> 01:33:47.021
PRESENT IN EIGHT MINUTES OR

01:33:47.088 --> 01:34:00.701
LESS THE PITFALLS AN. UNDER

01:34:00.768 --> 01:34:02.036
PROPOSITION 218, WHICH APPLIES

01:34:02.103 --> 01:34:04.605
TO RETAIL WATER RATES BUT NOT

01:34:04.672 --> 01:34:07.408
WHOLESALE WATER RATES. THE

01:34:07.475 --> 01:34:10.344
AGENCY, NOT ANY CHALLENGER,

01:34:10.411 --> 01:34:12.213
MUST PROVE TO A COURT

01:34:12.279 --> 01:34:13.514
SATISFACTION THAT ITS RATES

01:34:13.581 --> 01:34:15.049
DON'T EXCEED THE COST OF

01:34:15.116 --> 01:34:16.484
SERVICE, THE REASONABLE COST OF

01:34:16.550 --> 01:34:18.285
SERVICE, AND ARE FAIRLY

01:34:18.352 --> 01:34:19.420
APPORTIONED AMONG THOSE WHO PAY

01:34:19.487 --> 01:34:21.455
THOSE COSTS CONSISTENTLY WITH

01:34:21.522 --> 01:34:23.090
THE COST OF SERVICE. SO THAT'S

01:34:23.157 --> 01:34:24.825
ONE OF THE OBLIGATIONS OF PROP

01:34:24.892 --> 01:34:29.063
TWO. 18 JUDGES APPLY DEMANDING

01:34:29.130 --> 01:34:31.265
INDEPENDENT JUDGMENT REVIEW,

01:34:31.332 --> 01:34:32.666
WHICH MEANS THEY GET TO SECOND

01:34:32.733 --> 01:34:34.502
GUESS THE DECISIONS THAT RATE

01:34:34.568 --> 01:34:37.004
MAKERS MAKE. AND WHAT IS RATE

01:34:37.071 --> 01:34:38.773
MAKING. IT IS QUINTESSENTIALLY

01:34:38.839 --> 01:34:40.975
A LINE DRAWING EXERCISE ABOUT

01:34:41.042 --> 01:34:42.777
HOW TO APPORTION COSTS WHERE

01:34:42.843 --> 01:34:44.178
THERE'S NO ONE RIGHT ANSWER.

01:34:44.245 --> 01:34:45.246
AND THERE ARE DIFFERENT

01:34:45.312 --> 01:34:46.814
LEGISLATIVE APPROACHES. COURTS

01:34:46.881 --> 01:34:49.183
ARE NOT GENERALLY WELL SUITED

01:34:49.250 --> 01:34:52.486
TO INDEPENDENTLY JUDGING

01:34:52.553 --> 01:34:54.288
LEGISLATIVE POLICY DECISIONS,

01:34:54.355 --> 01:34:55.322
BUT THE VOTERS, IN THEIR WISDOM,

01:34:55.389 --> 01:34:58.192
GAVE US THE STANDARD, AND RATE

01:34:58.259 --> 01:35:01.429
MAKING IS BASED ON PREDICTIONS,

01:35:01.495 --> 01:35:03.998
EDUCATED GUESSES OF THE FUTURE.

01:35:04.065 --> 01:35:06.167
SO WHEN YOU GET STRICT JUDICIAL

01:35:06.233 --> 01:35:08.669
REVIEW OF PURE CHOICE AND A

01:35:08.736 --> 01:35:10.805
RANGE OF POLICIES THAT COULD BE

01:35:10.871 --> 01:35:13.307
LAWFUL BASED ON PREDICTIONS,

01:35:13.374 --> 01:35:15.076
WHAT YOU GET IS A WHOLE LOT OF

01:35:15.142 --> 01:35:18.345
UNCERTAINTY. IT'S A MISMATCH

01:35:18.412 --> 01:35:20.481
BETWEEN ESTIMATE DRIVEN

01:35:20.548 --> 01:35:22.683
JUDGMENTS AND A LACK OF

01:35:22.750 --> 01:35:25.519
DEFERENTIAL REVIEW. WHAT'S THE

01:35:25.586 --> 01:35:28.823
RESULT OF THIS MISMATCH? ONE IS

01:35:28.889 --> 01:35:30.891
UNCERTAINTY. I CAN'T TELL MY

01:35:30.958 --> 01:35:33.160
CLIENTS WITH A GREAT DEAL. I'M

01:35:33.227 --> 01:35:35.262
ON SLIDE FOUR. FOR THOSE OF YOU

01:35:35.329 --> 01:35:37.498
WHO NEED TO CATCH UP, I CAN'T

01:35:37.565 --> 01:35:40.000
TELL MY CLIENTS WITH CONFIDENCE

01:35:40.067 --> 01:35:41.769
THAT ANY GIVEN RATE MAKING

01:35:41.836 --> 01:35:42.837
STRATEGY WILL WITHSTAND

01:35:42.903 --> 01:35:44.972
JUDICIAL REVIEW, BECAUSE I'M

01:35:45.039 --> 01:35:46.140
PREDICTING THE OUTCOME OF A

01:35:46.207 --> 01:35:50.010
HUMAN PROCESS. A COUPLE OF

01:35:50.077 --> 01:35:53.647
CASES FROM THE EARLY TEENS

01:35:53.714 --> 01:35:54.748
ESTABLISHED THAT WHEN

01:35:54.815 --> 01:35:56.884
GOVERNMENT GETS IT WRONG,

01:35:56.951 --> 01:35:59.386
REFUNDS CAN BE ORDERED. AND IF

01:35:59.453 --> 01:36:01.188
REFUNDS ARE ORDERED, THE

01:36:01.255 --> 01:36:02.656
PLAINTIFF'S COUNSEL GETS A

01:36:02.723 --> 01:36:04.458
THIRD TO A QUARTER OF THE

01:36:04.525 --> 01:36:06.260
RECOVERY. THE CITY OF LOS

01:36:06.327 --> 01:36:08.796
ANGELES IS SUCH A LARGE UTILITY

01:36:08.863 --> 01:36:10.564
PROVIDER AND SUCH AN ATTRACTIVE

01:36:10.631 --> 01:36:12.166
TARGET FOR LITIGANTS THAT ONE

01:36:12.233 --> 01:36:13.834
OF MY COLLEAGUES HAS A CASELOAD

01:36:13.901 --> 01:36:16.003
FOR LA OF A DOZEN CASES AT ANY

01:36:16.070 --> 01:36:18.105
GIVEN TIME ON ALL OF THEIR

01:36:18.172 --> 01:36:19.573
UTILITY CHARGES WATER, SEWER,

01:36:19.640 --> 01:36:21.208
TRASH, YOU NAME IT. ANYTHING

01:36:21.275 --> 01:36:23.077
THAT COMES UP IN THE PAPER THAT

01:36:23.144 --> 01:36:24.178
SUGGESTS A NEW THEORY SUDDENLY

01:36:24.245 --> 01:36:26.046
IS A BUNCH OF CASES FILED. SO

01:36:26.113 --> 01:36:27.515
THERE'S A LOT OF LITIGATION

01:36:27.581 --> 01:36:29.617
THAT'S PAID FOR BY RATEPAYERS,

01:36:29.683 --> 01:36:31.452
AND THEY PAY BOTH DEFENSE

01:36:31.519 --> 01:36:32.920
COUNSEL. AND ULTIMATELY, IF

01:36:32.987 --> 01:36:34.288
PLAINTIFFS WIN PLAINTIFF'S

01:36:34.355 --> 01:36:37.424
COUNSEL, WHAT'S THE PROCESS

01:36:37.491 --> 01:36:40.060
LOOK LIKE UNDER PROP 218 FOR

01:36:40.127 --> 01:36:42.263
RETAIL RATES, WE HAVE TO MAIL A

01:36:42.329 --> 01:36:43.998
WRITTEN NOTICE TO ALL OF OUR

01:36:44.064 --> 01:36:45.399
CUSTOMERS. CALL THAT ABOUT A

01:36:45.466 --> 01:36:46.934
DOLLAR A NOTICE. SO FOR SAN

01:36:47.001 --> 01:36:49.803
DIEGO, FOR EXAMPLE, 250,000

01:36:49.870 --> 01:36:51.138
CUSTOMERS, A QUARTER OF $1

01:36:51.205 --> 01:36:52.373
MILLION JUST TO DO THE NOTICE

01:36:52.439 --> 01:36:54.808
CITY OF LA, MUCH LARGER. YOU

01:36:54.875 --> 01:36:56.510
GOT TO MAIL THEM A NOTICE, YOU

01:36:56.577 --> 01:36:59.513
GOT TO WAIT 45 DAYS AND HAVE A

01:36:59.580 --> 01:37:00.614
HEARING AT WHICH MAJORITY

01:37:00.681 --> 01:37:02.416
PROTESTS CAN BE LODGED. AND

01:37:02.483 --> 01:37:03.450
THAT'S JUST SOMETHING IN

01:37:03.517 --> 01:37:05.286
WRITING BY AN OWNER OR CUSTOMER

01:37:05.352 --> 01:37:08.088
SAYING, I OBJECT BECAUSE A

01:37:08.155 --> 01:37:10.624
MAJORITY PROTEST IS DEFINED BY

01:37:10.691 --> 01:37:13.527
50%, PLUS ONE OF CUSTOMERS

01:37:13.594 --> 01:37:14.962
RESPONDING IN WRITING IN A 45

01:37:15.029 --> 01:37:16.530
DAY PERIOD. WE DON'T SEE THEM

01:37:16.597 --> 01:37:18.899
VERY OFTEN. WE DON'T SEE

01:37:18.966 --> 01:37:20.434
MAJORITY PARTICIPATION IN

01:37:20.501 --> 01:37:22.570
PUBLIC LIFE. YOU KNOW, LOCAL

01:37:22.636 --> 01:37:24.004
GOVERNMENTS ARE LIKELY TO GET

01:37:24.071 --> 01:37:26.207
40% TURNOUTS IN THEIR ELECTIONS.

01:37:26.273 --> 01:37:27.908
SO ASKING PEOPLE TO PUT IT IN

01:37:27.975 --> 01:37:29.843
WRITING IN A 45 DAY WINDOW, WE

01:37:29.910 --> 01:37:31.045
DON'T SEE THEM VERY OFTEN. BUT

01:37:31.111 --> 01:37:32.846
YOU DON'T NEED TO BE A

01:37:32.913 --> 01:37:33.847
SUCCESSFUL MAJORITY PROTEST TO

01:37:33.914 --> 01:37:35.516
MAKE A REAL DIFFERENCE IN HOW

01:37:35.583 --> 01:37:37.318
GOVERNMENT, HOW MUCH, HOW

01:37:37.384 --> 01:37:39.520
POLITICALLY BRAVE IT MAY FEEL

01:37:39.587 --> 01:37:42.022
TO TACKLE COSTS THAT NEED TO BE

01:37:42.089 --> 01:37:43.857
TACKLED. SO I'M ON TO MY NEXT

01:37:43.924 --> 01:37:54.969
SLIDE NOW. LET'S SEE. SO HOW

01:37:55.035 --> 01:37:56.370
DOES LOCAL GOVERNMENT MANAGE

01:37:56.437 --> 01:37:58.606
THESE RISKS? HOW DO I ADVISE MY

01:37:58.672 --> 01:38:00.374
CLIENTS TO MANAGE THESE RISKS?

01:38:00.441 --> 01:38:02.042
ONE IS I THINK WE SHOULD BE IN

01:38:02.109 --> 01:38:03.911
REGULAR DIALOG WITH OUR CLIENTS,

01:38:03.978 --> 01:38:05.813
OUR CUSTOMERS ABOUT WHAT THINGS

01:38:05.879 --> 01:38:07.848
COST SO THAT WHEN WE COME TO

01:38:07.915 --> 01:38:09.516
THEM WITH AN ASK FOR MONEY,

01:38:09.583 --> 01:38:10.951
IT'S NOT OUT OF THE BLUE. AND

01:38:11.018 --> 01:38:12.119
IT'S NOT THE ONLY THING THEY

01:38:12.186 --> 01:38:14.488
HEAR FROM US. I ADVISE MY

01:38:14.555 --> 01:38:16.190
CLIENTS TO HIRE A RATEMAKING

01:38:16.257 --> 01:38:16.924
CONSULTANT, SOMEBODY

01:38:16.991 --> 01:38:18.259
INDEPENDENT OF THE AGENCY WITH

01:38:18.325 --> 01:38:19.526
THE RIGHT SET OF INITIALS AFTER

01:38:19.593 --> 01:38:21.562
THEIR NAME. AND IF THEY DON'T

01:38:21.629 --> 01:38:22.730
HAVE HOUSE COUNSEL WITH THE

01:38:22.796 --> 01:38:24.565
ABILITY TO DO IT, HIRE A LAWYER

01:38:24.632 --> 01:38:26.333
EXPERT IN THIS AREA TO REVIEW

01:38:26.400 --> 01:38:28.502
THE RATE MAKERS WORK. THIS IS

01:38:28.569 --> 01:38:30.271
WHAT'S NEEDED TO MAKE A RECORD

01:38:30.337 --> 01:38:32.039
THAT WILL ALLOW US TO SELL OUR

01:38:32.106 --> 01:38:34.575
RATES TO A JUDGE, AND IT CAN BE

01:38:34.642 --> 01:38:37.044
COSTLY. SO AN IDEA IS TO SEE

01:38:37.111 --> 01:38:39.213
THAT TECHNICAL ASSISTANCE IS

01:38:39.280 --> 01:38:40.881
PROVIDED TO SMALLER AGENCIES,

01:38:40.948 --> 01:38:42.716
WHICH MAY NOT BE ABLE TO DO

01:38:42.783 --> 01:38:45.352
THIS AT HOME. THE NEXT IS TO

01:38:45.419 --> 01:38:46.453
IMPLEMENT PROCEDURAL

01:38:46.520 --> 01:38:47.154
PROTECTIONS THAT THE

01:38:47.221 --> 01:38:48.289
LEGISLATURE HAS GIVEN US. AND

01:38:48.355 --> 01:38:50.824
I'VE GOT A SLIDE ON THAT COMING

01:38:50.891 --> 01:38:52.259
SITE AND USE THE STANDARDS THE

01:38:52.326 --> 01:38:53.394
LEGISLATURE HAS ADOPTED TO TRY

01:38:53.460 --> 01:38:54.895
TO PROTECT WATER RATES. I'VE

01:38:54.962 --> 01:38:56.230
GOT A SLIDE ON THAT, TOO. AND

01:38:56.297 --> 01:38:57.898
THEN THERE'S THE SUPREME COURT

01:38:57.965 --> 01:38:58.899
CASE PENDING INVOLVING LAS

01:38:58.966 --> 01:39:00.467
TIERED WATER RATES THAT WE'RE

01:39:00.534 --> 01:39:10.577
ALL WATCHING VERY CLOSELY. THE

01:39:10.644 --> 01:39:12.012
PROCEDURAL PROTECTIONS THE

01:39:12.079 --> 01:39:14.515
LEGISLATURE HAS GIVEN US SO FAR

01:39:14.581 --> 01:39:17.184
ARE THREE. THERE'S SB 1072.

01:39:17.251 --> 01:39:18.852
THAT WAS SENATOR PADILLA'S BAN

01:39:18.919 --> 01:39:21.055
ON REFUNDS OF WATER AND SEWER

01:39:21.121 --> 01:39:23.223
RATES, BUT NOT TRASH RATES,

01:39:23.290 --> 01:39:24.591
REQUIRING THAT ANY ERROR THAT

01:39:24.658 --> 01:39:26.460
WE MAKE IN THE LIGHT OF THE

01:39:26.527 --> 01:39:27.528
COURT SECOND GUESSING US AFTER

01:39:27.594 --> 01:39:29.997
THE FACT BE PAID BY CREDITS ON

01:39:30.064 --> 01:39:31.799
FUTURE BILLS RATHER THAN

01:39:31.865 --> 01:39:34.335
REFUNDS THAT WILL Ã REDUCE

01:39:34.401 --> 01:39:35.736
WHAT I SEE AS THE OVER

01:39:35.803 --> 01:39:36.937
LITIGATION OF THESE SUBJECTS.

01:39:37.004 --> 01:39:38.339
THERE'S TOO MUCH INCENTIVE TO

01:39:38.405 --> 01:39:39.506
CHALLENGE. YOU NEED SOME TO

01:39:39.573 --> 01:39:40.708
MAKE SURE THAT WE'RE FOLLOWING

01:39:40.774 --> 01:39:42.476
THE RULES, BUT I THINK WE HAVE

01:39:42.543 --> 01:39:45.479
TOO MUCH. AND IT'S JUST

01:39:45.546 --> 01:39:46.647
EXPENSIVE. THE MECHANICS OF

01:39:46.714 --> 01:39:51.552
REFUNDS ARE EXPENSIVE. WE GOT.

01:39:51.618 --> 01:39:55.255
COURTESY OF SENATOR SENATOR

01:39:55.322 --> 01:39:59.193
WARTY AB 2257, WHICH ALLOWS US

01:39:59.259 --> 01:40:01.362
TO OPT INTO A PROCESS BY WHICH,

01:40:01.428 --> 01:40:02.763
BEFORE YOU SUE US, YOU GOT TO

01:40:02.830 --> 01:40:04.598
COME TO A HEARING, TELL US WHAT

01:40:04.665 --> 01:40:06.433
THE PROBLEMS ARE AND GIVE US A

01:40:06.500 --> 01:40:07.701
CHANCE TO FIX IT. IT'S MODELED

01:40:07.768 --> 01:40:09.436
ON SEQUA. MOST AGENCIES ARE

01:40:09.503 --> 01:40:10.637
DOING IT. I THINK IT WILL MAKE

01:40:10.704 --> 01:40:12.439
A POSITIVE DIFFERENCE. AND THEN

01:40:12.506 --> 01:40:15.042
WE HAVE SB 323 FROM 2021, WHICH

01:40:15.109 --> 01:40:16.076
ESTABLISHED RELATIVELY SHORT

01:40:16.143 --> 01:40:18.645
STATUTE OF LIMITATIONS 120 DAYS

01:40:18.712 --> 01:40:20.047
AFTER THE RATES TAKE EFFECT.

01:40:20.114 --> 01:40:21.415
FIRST TIME SOMEBODY SEES IT ON

01:40:21.482 --> 01:40:24.752
A BILL, THE CLOCK STARTS. THE

01:40:24.818 --> 01:40:26.520
LEGISLATURE HAS ALSO GIVEN US,

01:40:26.587 --> 01:40:27.721
COURTESY OF OUR CHAIR TODAY AND

01:40:27.788 --> 01:40:31.191
SOME OTHERS STANDARDS THAT ARE

01:40:31.258 --> 01:40:32.626
INTENDED TO SORT OF GUIDE THE

01:40:32.693 --> 01:40:34.428
COURT'S INDEPENDENT JUDGMENT

01:40:34.495 --> 01:40:36.296
REVIEW AND OUR RATE MAKING TO

01:40:36.363 --> 01:40:38.899
KEEP US OUT OF TROUBLE. SO 2016,

01:40:38.966 --> 01:40:41.735
SB 1386 GAVE US PROTECTION OF

01:40:41.802 --> 01:40:43.437
FIRE FLOWS. YOU KNOW, WHEN YOU

01:40:43.504 --> 01:40:44.872
OPEN YOUR TAP, YOU'RE GETTING

01:40:44.938 --> 01:40:46.573
ENOUGH PRESSURE TO RUN YOUR

01:40:46.640 --> 01:40:47.808
FIRE SPRINKLERS, AND THERE'S

01:40:47.875 --> 01:40:48.942
ENOUGH PRESSURE IN THE STREET

01:40:49.009 --> 01:40:50.310
TO RUN THE FIRE HYDRANT. AND

01:40:50.377 --> 01:40:51.812
THAT PRESSURE DOESN'T COME FOR

01:40:51.879 --> 01:40:53.180
FREE. AND SOME PEOPLE WANTED TO

01:40:53.247 --> 01:40:54.281
ARGUE THAT THAT SHOULD BE

01:40:54.348 --> 01:40:56.350
FUNDED BY TAXES. AS A FIRE

01:40:56.417 --> 01:40:58.619
SERVICE. WE THINK THAT IS A

01:40:58.685 --> 01:41:00.754
ASPECT OF LAWFUL WATER SERVICE,

01:41:00.821 --> 01:41:01.955
AND THE LEGISLATURE HAS AGREED

01:41:02.022 --> 01:41:03.991
WITH US. YOU'VE MADE THREE

01:41:04.057 --> 01:41:05.759
EFFORTS AS A LEGISLATURE, TWO

01:41:05.826 --> 01:41:07.494
OF THEM COURTESY OF OUR CHAIR

01:41:07.561 --> 01:41:08.996
AND RECENTLY TO TRY TO PROTECT

01:41:09.062 --> 01:41:10.798
TIERED WATER RATES. THE

01:41:10.864 --> 01:41:11.799
LEGISLATIVE SUPREME COURT HAS

01:41:11.865 --> 01:41:13.033
ASKED FOR A BRIEF ON THE MOST

01:41:13.100 --> 01:41:16.336
RECENT BILL, 1827. THESE HAVE

01:41:16.403 --> 01:41:18.005
BEEN HELPFUL. HAVE THE END OF

01:41:18.071 --> 01:41:19.473
THE PROBLEM OF TOO MUCH

01:41:19.540 --> 01:41:22.009
LITIGATION? NOT YET. AND THEN

01:41:22.075 --> 01:41:23.377
THE INTREPID SENATOR HERTZBERG.

01:41:23.444 --> 01:41:24.545
I ALWAYS CALL HIM THAT BECAUSE

01:41:24.611 --> 01:41:26.346
HE LIKES TO TAKE ON THE

01:41:26.413 --> 01:41:27.748
TOUGHEST PROBLEMS, GAVE US SOME

01:41:27.815 --> 01:41:29.516
GUIDANCE ON STORM SEWER RATES.

01:41:29.583 --> 01:41:30.984
NOBODY'S BEEN BRAVE ENOUGH TO

01:41:31.051 --> 01:41:34.555
TEST THAT OUT JUST YET. SO NEXT

01:41:34.621 --> 01:41:39.359
SLIDE. THE CITY. THERE HAVE

01:41:39.426 --> 01:41:41.395
BEEN THREE BIG CASES LATELY.

01:41:41.462 --> 01:41:42.863
SAN DIEGO LOST THEIR TIERED

01:41:42.930 --> 01:41:44.665
RATES. CASE. THE OTAY WATER

01:41:44.731 --> 01:41:46.366
DISTRICT ADJACENT TO SAN DIEGO

01:41:46.433 --> 01:41:47.901
DOWN ON THE BORDER, LOST ITS

01:41:47.968 --> 01:41:49.670
TIERED RATES CASE. AND MY

01:41:49.736 --> 01:41:51.472
PARTNER, HOLLY WATLEY WON FOR

01:41:51.538 --> 01:41:53.307
LOS ANGELES ON ITS TIERED RATES

01:41:53.373 --> 01:41:55.075
CASE. THE DIFFERENCE BETWEEN

01:41:55.142 --> 01:41:57.177
THOSE CASES IS THE OLDER TWO

01:41:57.244 --> 01:41:59.079
CASES WERE BASED ON RECORDS

01:41:59.146 --> 01:42:00.881
PREPARED BEFORE WE REALLY

01:42:00.948 --> 01:42:01.949
LEARNED WHAT THE COURTS WERE

01:42:02.015 --> 01:42:03.750
DEMANDING ON RECORDS, AND LA IS

01:42:03.817 --> 01:42:05.586
A MORE MODERN RECORD THAT DOES

01:42:05.652 --> 01:42:07.387
A BETTER JOB OF EXPLAINING TO A

01:42:07.454 --> 01:42:09.189
JUDGE WHO MAY HAVE GONE TO LAW

01:42:09.256 --> 01:42:10.257
SCHOOL BECAUSE HE OR SHE

01:42:10.324 --> 01:42:11.358
DOESN'T LIKE MATH, HOW WE GOT

01:42:11.425 --> 01:42:14.261
TO OUR RATES AND LA WON, MUCH

01:42:14.328 --> 01:42:15.596
TO OUR CHAGRIN IN LOCAL

01:42:15.662 --> 01:42:16.396
GOVERNMENT. THE SUPREME COURT

01:42:16.463 --> 01:42:18.031
DIDN'T TAKE REVIEW OF THE TWO

01:42:18.098 --> 01:42:19.299
THAT WE LOST. THEY TOOK REVIEW

01:42:19.366 --> 01:42:21.068
OF THE ONE THAT WE WON. BUT

01:42:21.134 --> 01:42:22.903
THEY DID LIMIT THE QUESTION TO

01:42:22.970 --> 01:42:25.839
JUST WHETHER LOS ANGELES RECORD

01:42:25.906 --> 01:42:27.474
WAS ADEQUATE TO SUPPORT ITS

01:42:27.541 --> 01:42:28.842
RATES. AND ANOTHER ISSUE WE WON,

01:42:28.909 --> 01:42:31.111
A PROCEDURAL PROTECTION WAS

01:42:31.178 --> 01:42:33.213
LESS STANDING. THAT CASE IS NOW

01:42:33.280 --> 01:42:34.348
FULLY BRIEFED. THE SUPPLEMENTAL

01:42:34.414 --> 01:42:36.750
BRIEFS ON AB 1827 JUST CAME IN

01:42:36.817 --> 01:42:38.652
THIS MONTH. WE WOULD EXPECT THE

01:42:38.719 --> 01:42:40.120
SUPREME COURT TO SET THIS FOR

01:42:40.187 --> 01:42:42.322
ARGUMENT, PROBABLY LATE 2027,

01:42:42.389 --> 01:42:44.391
AND WE'LL GET A DECISION EARLY

01:42:44.458 --> 01:42:46.994
2028. AND UNTIL THEN, ALL OF US

01:42:47.060 --> 01:42:50.497
CONCERNED WITH. TIERED WATER

01:42:50.564 --> 01:42:52.699
RATES ARE HOLDING OUR BREATH.

01:42:52.766 --> 01:42:54.434
AND WITH THAT, MADAM CHAIR AND

01:42:54.501 --> 01:42:55.502
MR. CHAIRMAN, THAT'S WHAT I

01:42:55.569 --> 01:42:58.205
HAVE FOR YOU. GREAT. THANK YOU

01:42:58.272 --> 01:43:02.643
SO MUCH. WHO'S GOING TO GO

01:43:02.709 --> 01:43:04.511
FIRST, MR. OR MR. COMPTON? MR.

01:43:04.578 --> 01:43:06.280
ZUKA, WELCOME. THANK YOU. I

01:43:06.346 --> 01:43:09.216
THINK I'M NEXT ON THE LIST.

01:43:09.283 --> 01:43:11.018
WAIT FOR THE POWERPOINT TO COME

01:43:11.084 --> 01:43:17.190
UP. WHILE WE'RE WAITING, I HOPE

01:43:17.257 --> 01:43:19.293
I'M GOING TO PROVIDE A LOCAL

01:43:19.359 --> 01:43:20.827
PERSPECTIVE ON THIS PROBLEM. I

01:43:20.894 --> 01:43:22.963
SORT OF SEE THIS AS A TWO FOLD.

01:43:23.030 --> 01:43:24.231
ONE, THERE IS THE CHALLENGE OF

01:43:24.298 --> 01:43:25.899
HOW DO WE PAY FOR THE

01:43:25.966 --> 01:43:27.034
INFRASTRUCTURE THAT WE NEED.

01:43:27.100 --> 01:43:28.235
THE OTHER PART OF THAT, THOUGH,

01:43:28.302 --> 01:43:29.937
AND EQUALLY IMPORTANT, IS HOW

01:43:30.003 --> 01:43:31.271
DO WE ALLOCATE THE COSTS. SO

01:43:31.338 --> 01:43:32.706
RIGHT NOW SOME OF THE

01:43:32.773 --> 01:43:33.373
CONVERSATIONS HAVE BEEN AROUND

01:43:33.440 --> 01:43:35.509
PROP 218 AND THE LEGAL

01:43:35.576 --> 01:43:37.444
CONSTRAINTS ON THAT. WHAT I'M

01:43:37.511 --> 01:43:38.812
HOPING TO SHOW TODAY IS, AND

01:43:38.879 --> 01:43:40.480
TALK A LITTLE BIT ABOUT IS HOW

01:43:40.547 --> 01:43:41.615
THE COST OF UTILITIES IS

01:43:41.682 --> 01:43:42.749
PLAYING INTO THE AFFORDABILITY

01:43:42.816 --> 01:43:46.353
CRISIS AS WELL, AND SORT OF THE

01:43:46.420 --> 01:43:48.922
EQUITY AROUND PROP 218 AND SOME

01:43:48.989 --> 01:43:53.493
OF THE ISSUES THAT IT CREATES.

01:43:53.560 --> 01:43:58.231
I'M GONNA GO. THERE WE GO. OKAY.

01:43:58.298 --> 01:44:00.033
SO JUST BY WAY OF INTRODUCTION

01:44:00.100 --> 01:44:01.468
TO BECAUSE I COME AT THIS

01:44:01.535 --> 01:44:03.203
WEARING A FEW HATS AGAIN, MY

01:44:03.270 --> 01:44:05.072
NAME IS MATT ZUKA. MY

01:44:05.138 --> 01:44:06.340
BACKGROUND IS IN A COMBINATION

01:44:06.406 --> 01:44:07.941
OF CONSULTING ENGINEERING FOR

01:44:08.008 --> 01:44:09.509
25 YEARS. SO I'M A LICENSED

01:44:09.576 --> 01:44:11.078
CIVIL ENGINEER. I WORKED IN

01:44:11.144 --> 01:44:13.013
CONSULTING FOR ABOUT 25 YEARS

01:44:13.080 --> 01:44:14.247
BEFORE I WENT INTO LOCAL

01:44:14.314 --> 01:44:16.083
GOVERNMENT, AND I'VE WORKED AS

01:44:16.149 --> 01:44:17.551
DEPUTY DIRECTOR AND ASSISTANT

01:44:17.618 --> 01:44:18.685
DIRECTOR OF PUBLIC WORKS FOR

01:44:18.752 --> 01:44:20.787
SAN MATEO AND CITY OF PALO ALTO.

01:44:20.854 --> 01:44:22.656
AT PALO ALTO, I OVERSAW THE

01:44:22.723 --> 01:44:24.391
WATER AND WASTEWATER UTILITIES,

01:44:24.458 --> 01:44:25.826
SO BOTH ON THE PROP TWO SIDE

01:44:25.892 --> 01:44:28.095
AND THE PROP 26 SIDE, THE GASES

01:44:28.161 --> 01:44:30.163
IN PARTICULAR LEAVING PALO ALTO.

01:44:30.230 --> 01:44:31.765
I'M NOW THE GENERAL MANAGER FOR

01:44:31.832 --> 01:44:33.500
SILICON VALLEY CLEAN WATER, AND

01:44:33.567 --> 01:44:35.402
I'VE ALSO BEEN ON THE BOARD OF

01:44:35.469 --> 01:44:36.403
DIRECTORS FROM A POLITICAL

01:44:36.470 --> 01:44:37.337
STANDPOINT FOR MID-PENINSULA

01:44:37.404 --> 01:44:38.705
WATER DISTRICT FOR ABOUT THE

01:44:38.772 --> 01:44:48.548
LAST 25 YEARS. SHOULD ADVANCE.

01:44:48.615 --> 01:44:51.718
NOPE. THERE WE GO. ALL RIGHT.

01:44:51.785 --> 01:44:53.587
THE CHART THAT I'M SHOWING HERE

01:44:53.654 --> 01:44:54.888
ACTUALLY LET ME GET BACK UP.

01:44:54.955 --> 01:44:57.524
SORRY, I'M CLICKING TOO MUCH.

01:44:57.591 --> 01:44:59.292
ALL RIGHT. SILICON VALLEY CLEAN

01:44:59.359 --> 01:45:02.896
WATER IS LOCATED IN THE

01:45:02.963 --> 01:45:04.364
PENINSULA WHERE A JOINT POWERS

01:45:04.431 --> 01:45:05.832
AUTHORITY MEMBER AGENCIES ARE

01:45:05.899 --> 01:45:07.968
BELMONT, SAN CARLOS, REDWOOD

01:45:08.035 --> 01:45:10.103
CITY AND WEST BAY SANITARY

01:45:10.170 --> 01:45:11.371
DISTRICT. WE TREAT WASTEWATER

01:45:11.438 --> 01:45:14.808
FOR ABOUT 300,000 PEOPLE. MID

01:45:14.875 --> 01:45:15.575
PENINSULA WATER DISTRICT IS IN

01:45:15.642 --> 01:45:17.210
THE SAME AREA. IT SERVES THE

01:45:17.277 --> 01:45:18.712
CITY OF BELMONT ABOUT 30,000

01:45:18.779 --> 01:45:21.048
PEOPLE. JUST TO PROVIDE CONTEXT

01:45:21.114 --> 01:45:23.083
TO SOME OF MY SPHERE OF

01:45:23.150 --> 01:45:24.351
INFLUENCE IN THE JURISDICTION

01:45:24.418 --> 01:45:27.754
THAT I SUPPORT, THIS CHART IS

01:45:27.821 --> 01:45:28.822
INTENDED TO HIGHLIGHT TWO

01:45:28.889 --> 01:45:31.324
THINGS. THE BOTTOM BLUE LINE

01:45:31.391 --> 01:45:32.993
REPRESENTS CUMULATIVE INFLATION

01:45:33.060 --> 01:45:36.029
IN THE BAY AREA SINCE ABOUT

01:45:36.096 --> 01:45:38.165
1984. SO WHAT YOU CAN SEE IS

01:45:38.231 --> 01:45:40.067
THAT SINCE THEN, INFLATION HAS

01:45:40.133 --> 01:45:44.337
GONE UP ABOUT 125%. THE UPPER

01:45:44.404 --> 01:45:45.739
LINE REPRESENTS THE WHOLESALE

01:45:45.806 --> 01:45:47.708
WATER COSTS IN SAN FRANCISCO.

01:45:47.774 --> 01:45:49.009
SO THIS IS THE SAN FRANCISCO

01:45:49.076 --> 01:45:50.811
PUBLIC UTILITY COMMISSION'S

01:45:50.877 --> 01:45:52.979
COST OF PROVIDING, OR WHAT THEY

01:45:53.046 --> 01:45:55.482
CHARGE FOR WATER TO THE RETAIL

01:45:55.549 --> 01:45:59.086
AGENCIES. THAT HAS GONE UP 350%.

01:45:59.152 --> 01:46:00.821
SO THE COST OF UTILITY AND

01:46:00.887 --> 01:46:02.289
WATER SERVICE AT THE WHOLESALE

01:46:02.355 --> 01:46:04.424
LEVEL IS DRASTICALLY OUTPACING

01:46:04.491 --> 01:46:06.126
THE ACTUAL COST OF INFLATION IN

01:46:06.193 --> 01:46:09.930
THE BAY AREA. WHEN YOU LAYER ON

01:46:09.996 --> 01:46:12.065
TOP OF THAT, WE ARE A LOCAL

01:46:12.132 --> 01:46:13.100
AGENCY DISTRIBUTING THE WATER.

01:46:13.166 --> 01:46:15.268
WE HAVE OUR OWN COSTS. SO IN

01:46:15.335 --> 01:46:17.404
THIS CHART, THE BOTTOM LINE IS

01:46:17.471 --> 01:46:18.572
THE WHOLESALE WATER COSTS THAT

01:46:18.638 --> 01:46:20.707
YOU SAW IN THE PREVIOUS SLIDE,

01:46:20.774 --> 01:46:22.209
THE GREEN LINE IS NOW WHAT WE

01:46:22.275 --> 01:46:23.744
ARE CHARGING CONSUMERS. AND SO

01:46:23.810 --> 01:46:25.011
YOU CAN SEE THAT EVEN THAT IS

01:46:25.078 --> 01:46:26.813
CONTINUING TO ACCELERATE AS

01:46:26.880 --> 01:46:30.117
WELL. AND YOU KNOW, THE THE

01:46:30.183 --> 01:46:32.219
COST TO THE LOCAL CONSUMER IS

01:46:32.285 --> 01:46:33.653
THAT THE AND I'LL TALK ABOUT

01:46:33.720 --> 01:46:34.855
THIS IN A LITTLE BIT MORE

01:46:34.921 --> 01:46:36.590
DETAIL. WATER RATES ARE GOING

01:46:36.656 --> 01:46:38.291
UP DISPROPORTIONATELY AND MORE

01:46:38.358 --> 01:46:41.094
QUICKLY THAN THE COST OF

01:46:41.161 --> 01:46:42.195
INFLATION AND THE GENERAL COST

01:46:42.262 --> 01:46:48.034
OF GOODS. THAT IS MIRRORED BY

01:46:48.101 --> 01:46:49.803
AND THIS IS SORT OF A NATIONAL

01:46:49.870 --> 01:46:52.339
AVERAGE. WAGES HAVE NOT KEPT UP,

01:46:52.405 --> 01:46:54.107
NEEDLESS TO SAY. SO ON THE

01:46:54.174 --> 01:46:56.777
UPPER END OF EARNERS, THE TOP

01:46:56.843 --> 01:46:58.845
TEN PERCENTILE NATIONWIDE. AND

01:46:58.912 --> 01:47:00.447
IT MIGHT BE A LITTLE BIT

01:47:00.514 --> 01:47:01.615
DIFFERENT IN THE BAY AREA, BUT

01:47:01.681 --> 01:47:03.550
I WOULDN'T EXPECT IT TO BE THAT

01:47:03.617 --> 01:47:04.518
MUCH. DRASTICALLY DIFFERENT IS

01:47:04.584 --> 01:47:05.986
UP 64% COMPARED TO 125% ON

01:47:06.052 --> 01:47:07.854
INFLATION, 350% ON THE

01:47:07.921 --> 01:47:10.023
WHOLESALE COST OF WATER. AND SO

01:47:10.090 --> 01:47:11.091
WHAT WE'RE SEEING IS THIS

01:47:11.158 --> 01:47:12.859
WIDENING GAP, I THINK LOCALLY

01:47:12.926 --> 01:47:17.931
IN LOCAL GOVERNMENT. PUTTING ON

01:47:17.998 --> 01:47:19.366
MY SILICON VALLEY CLEAN WATER

01:47:19.432 --> 01:47:21.168
HAT. NOW AS A GENERAL MANAGER

01:47:21.234 --> 01:47:24.771
FOR THE WASTEWATER AUTHORITY,

01:47:24.838 --> 01:47:26.239
WHAT I WANTED TO SHOW ON THIS

01:47:26.306 --> 01:47:28.475
SLIDE IS SORT OF THE LIFE CYCLE

01:47:28.542 --> 01:47:30.544
SINCE INCEPTION OF OUR FACILITY

01:47:30.610 --> 01:47:32.345
AND HOW THE COSTS ARE BEING

01:47:32.412 --> 01:47:33.814
BORN. SO IF YOU LOOK AT THIS,

01:47:33.880 --> 01:47:35.315
THIS BOTTOM, THIS CHART GOES

01:47:35.382 --> 01:47:37.050
BACK TO 1976. THIS IS BACK WHEN

01:47:37.117 --> 01:47:38.652
THE CLEAN WATER ACT INITIALLY

01:47:38.718 --> 01:47:40.287
WAS PASSED AND IT FUNDED OUR

01:47:40.353 --> 01:47:41.688
THE CONSTRUCTION OF OUR

01:47:41.755 --> 01:47:44.925
FACILITY. THE BLUE BARS

01:47:44.991 --> 01:47:46.660
REPRESENT FEDERAL GRANT DOLLARS,

01:47:46.726 --> 01:47:48.595
NOT LOANS, NOT WIFIA, NOT SRF,

01:47:48.662 --> 01:47:49.963
BUT ACTUALLY FREE MONEY THAT

01:47:50.030 --> 01:47:51.565
WAS GIVEN TO OUR AGENCY TO

01:47:51.631 --> 01:47:54.634
ACTUALLY BUILD THIS PLANT. SO

01:47:54.701 --> 01:47:56.303
FOR THE FIRST 30 YEARS OF THIS

01:47:56.369 --> 01:47:57.871
PLANT, THE ONLY COST THAT OUR

01:47:57.938 --> 01:47:59.306
RATEPAYERS INCURRED WAS THE

01:47:59.372 --> 01:48:00.373
ANNUAL OPERATION AND

01:48:00.440 --> 01:48:02.209
MAINTENANCE OF THE PLANT. SINCE

01:48:02.275 --> 01:48:04.010
ABOUT 2008, AFTER 30 YEARS OF

01:48:04.077 --> 01:48:05.045
RUNNING A WASTEWATER PLANT

01:48:05.111 --> 01:48:06.947
RIGHT ON THE BAY, WE HAD TO

01:48:07.013 --> 01:48:07.614
INSTITUTE A CAPITAL

01:48:07.681 --> 01:48:08.982
IMPROVEMENTS PROGRAM. IT WAS

01:48:09.049 --> 01:48:10.483
STARTING TO FALL APART. SO

01:48:10.550 --> 01:48:11.885
SINCE ON THE SLIDE AGAIN, IT

01:48:11.952 --> 01:48:13.854
CHANGES COLORS 2008 TO PRESENT,

01:48:13.920 --> 01:48:15.956
WE'RE PROBABLY CLOSE TO $1

01:48:16.022 --> 01:48:17.724
BILLION OF CAPITAL PROJECTS

01:48:17.791 --> 01:48:19.226
THAT WE'VE HAD TO IMPLEMENT ON

01:48:19.292 --> 01:48:20.961
THE SAME PLANT. AND SO WHEN

01:48:21.027 --> 01:48:22.696
WE'RE TALKING ABOUT THE RATE

01:48:22.762 --> 01:48:24.264
BASE, THE RATEPAYERS NEVER PAID

01:48:24.331 --> 01:48:25.832
FOR THE ORIGINAL PLANT THAT

01:48:25.899 --> 01:48:27.767
CAME WITH FREE FEDERAL MONEY.

01:48:27.834 --> 01:48:29.569
THAT'S WHY WE'VE BEEN DOING TEN,

01:48:29.636 --> 01:48:31.004
20% RATE INCREASES, IS BECAUSE

01:48:31.071 --> 01:48:32.672
YOU'VE GOT TO GET FROM A RATE

01:48:32.739 --> 01:48:33.707
SYSTEM THAT WAS DESIGNED TO

01:48:33.773 --> 01:48:35.675
ONLY PAY FOR O&M TO A RATE

01:48:35.742 --> 01:48:36.877
SYSTEM THAT IS NOW DESIGNED TO

01:48:36.943 --> 01:48:38.678
PAY FOR O&M AND $1 BILLION

01:48:38.745 --> 01:48:40.013
WORTH OF CAPITAL COSTS IN A

01:48:40.080 --> 01:48:41.815
VERY SHORT TEN YEAR WINDOW OF

01:48:41.882 --> 01:48:44.651
TIME GOING FORWARD, WHICH IS

01:48:44.718 --> 01:48:46.786
SORT OF THE RIGHT PART OF THIS

01:48:46.853 --> 01:48:48.688
SLIDE. WE HAVE ADDITIONAL

01:48:48.755 --> 01:48:50.056
EXPENSES AS WELL. WHAT'S NOT

01:48:50.123 --> 01:48:51.591
SHOWN ON HERE IS THAT WE HAVE A

01:48:51.658 --> 01:48:55.228
NEW PERMIT. WE HAVE ABOUT $400

01:48:55.295 --> 01:48:56.930
MILLION OF ADDITIONAL EXPENSES.

01:48:56.997 --> 01:48:59.766
SO TO TO DEAL WITH THE NEW

01:48:59.833 --> 01:49:01.568
PERMIT. AND IF YOU WERE TO LAY

01:49:01.635 --> 01:49:04.170
OUT THE CHART BETWEEN NOW AND

01:49:04.237 --> 01:49:06.673
2034, IT WOULD DUPLICATE THAT

01:49:06.740 --> 01:49:07.841
HIGH SPIKE THAT WE'VE SEEN OVER

01:49:07.908 --> 01:49:09.943
THE LAST TEN YEARS. THAT'S TO

01:49:10.010 --> 01:49:11.311
REMOVE NITROGEN IN OUR

01:49:11.378 --> 01:49:12.345
WASTEWATER DISCHARGES GOING TO

01:49:12.412 --> 01:49:14.314
THE BAY. ALL OF THOSE COSTS

01:49:14.381 --> 01:49:16.216
OVER THE LAST TEN YEARS AND ALL

01:49:16.283 --> 01:49:17.384
OF THE COSTS GOING FORWARD ARE

01:49:17.450 --> 01:49:19.185
GOING TO BE BORNE BY THE

01:49:19.252 --> 01:49:20.287
RATEPAYERS, UNLESS WE CAN FIND

01:49:20.353 --> 01:49:22.188
OTHER SOURCES OF FUNDING. AND

01:49:22.255 --> 01:49:23.957
AGAIN, SORT OF THE THE CONCERN

01:49:24.024 --> 01:49:25.592
IS, IS HOW DO WE PASS THOSE

01:49:25.659 --> 01:49:27.928
COSTS ON RIGHT NOW AS A JPA, WE

01:49:27.994 --> 01:49:30.096
SEND OUT FOUR BILLS. OUR MEMBER

01:49:30.163 --> 01:49:31.197
AGENCIES THEN HAVE TO ALLOCATE

01:49:31.264 --> 01:49:32.232
THOSE COSTS BASED UPON THEIR

01:49:32.299 --> 01:49:38.772
OWN PROP 218 PROCESS. SO WHAT

01:49:38.838 --> 01:49:40.407
DO THESE COSTS MEAN? THAT THE

01:49:40.473 --> 01:49:41.875
CHART CERTAINLY SHOWS A LOT,

01:49:41.942 --> 01:49:44.744
BUT THE US EPA TENDS TO OR HAS

01:49:44.811 --> 01:49:46.680
CRITERIA ON AFFORDABILITY. THEY

01:49:46.746 --> 01:49:47.814
WOULD CHARACTERIZE SOMETHING

01:49:47.881 --> 01:49:49.416
THAT'S LOW FINANCIAL IMPACT AS

01:49:49.482 --> 01:49:51.685
LESS THAN 1% OF THE ARMY OR THE

01:49:51.751 --> 01:49:53.753
AREA MEDIAN INCOME. WITH THE

01:49:53.820 --> 01:49:55.255
NUTRIENT REMOVAL PROJECT COMING

01:49:55.322 --> 01:49:56.589
UP, WE EXPECT THAT WE'RE GOING

01:49:56.656 --> 01:49:58.091
TO BE GREATER THAN 2% OF THE

01:49:58.158 --> 01:49:59.592
ARMY, SO THAT WOULD BE

01:49:59.659 --> 01:50:01.795
CONSIDERED A HIGH IMPACT. BUT

01:50:01.861 --> 01:50:04.230
THAT'S 2% OF. AM I IN AN AREA

01:50:04.297 --> 01:50:05.532
WITH THE HIGHEST MEDIAN INCOME

01:50:05.598 --> 01:50:08.234
IN THE COUNTRY? IF YOU ARE

01:50:08.301 --> 01:50:10.303
LIVING IN THE AREA AND YOU ARE

01:50:10.370 --> 01:50:11.738
NOT FORTUNATE ENOUGH TO BE

01:50:11.805 --> 01:50:13.974
MAKING $210,000 A YEAR AS A

01:50:14.040 --> 01:50:15.775
FAMILY, MAYBE YOU'RE 50% OF THE

01:50:15.842 --> 01:50:17.010
ARMY NOW. YOUR WASTEWATER BILL

01:50:17.077 --> 01:50:18.678
IS GOING TO START APPROACHING

01:50:18.745 --> 01:50:21.514
5% OF YOUR OF YOUR INCOME. AND

01:50:21.581 --> 01:50:22.615
THAT'S JUST WASTEWATER. THAT

01:50:22.682 --> 01:50:23.683
DOESN'T ACCOUNT FOR WATER, THAT

01:50:23.750 --> 01:50:25.251
DOESN'T ACCOUNT FOR GAS, THAT

01:50:25.318 --> 01:50:26.353
DOESN'T ACCOUNT FOR THE ENERGY

01:50:26.419 --> 01:50:28.254
SIDE AS WELL. SO ONE OF THE

01:50:28.321 --> 01:50:29.222
THINGS THAT WE'RE VERY

01:50:29.289 --> 01:50:30.323
CONCERNED ABOUT IS HOW DO WE

01:50:30.390 --> 01:50:31.524
CONTINUE WITH THE CONSTRAINTS

01:50:31.591 --> 01:50:33.493
ON PROP 218 THAT FORCE US TO DO

01:50:33.560 --> 01:50:35.562
COST OF SERVICE? HOW DO WE

01:50:35.628 --> 01:50:36.763
CONTINUE TO DO THIS IN SUCH A

01:50:36.830 --> 01:50:39.132
WAY WHERE UTILITIES AREN'T

01:50:39.199 --> 01:50:40.233
BECOMING PART OF THE

01:50:40.300 --> 01:50:41.234
AFFORDABILITY CRISIS, OR HOW

01:50:41.301 --> 01:50:43.103
CAN WE MITIGATE THAT? RIGHT NOW,

01:50:43.169 --> 01:50:44.471
WE'RE SORT OF LOCKED IN IN

01:50:44.537 --> 01:50:45.739
TERMS OF HOW WE ALLOCATE THESE

01:50:45.805 --> 01:50:50.276
COSTS. SO YOU'VE HEARD A LOT

01:50:50.343 --> 01:50:52.879
TODAY ABOUT PROP 218. PROP 26

01:50:52.946 --> 01:50:55.415
IS ANOTHER ONE ON THERE. AND

01:50:55.482 --> 01:50:56.516
YOU KNOW, WE ARE CONSTRAINED IN

01:50:56.583 --> 01:50:58.118
TERMS OF HOW WE CAN ALLOCATE

01:50:58.184 --> 01:50:59.686
THOSE. I WILL SAY THAT, YOU

01:50:59.753 --> 01:51:01.454
KNOW, MY CONCLUSION ON THIS IS

01:51:01.521 --> 01:51:02.922
THAT UTILITY COSTS HAVE

01:51:02.989 --> 01:51:04.391
HISTORICALLY EXCEEDED AND FAR

01:51:04.457 --> 01:51:06.459
OUTPACED INFLATION. THERE IS NO

01:51:06.526 --> 01:51:07.560
SIGN OF THAT SLOWING DOWN

01:51:07.627 --> 01:51:08.661
ANYTIME SOON. IN FACT, I THINK

01:51:08.728 --> 01:51:12.265
IT'S PROBABLY ACCELERATING THE

01:51:12.332 --> 01:51:13.767
CURRENT RATES, AND WE SEE THIS

01:51:13.833 --> 01:51:14.868
GOING FORWARD INTO THE FUTURE

01:51:14.934 --> 01:51:16.903
WILL BE DISPROPORTIONATELY

01:51:16.970 --> 01:51:18.738
AFFECTING LOWER INCOME

01:51:18.805 --> 01:51:19.539
HOUSEHOLDS. THAT WOULD BE

01:51:19.606 --> 01:51:21.241
SPENDING A LOT GREATER PART OF

01:51:21.307 --> 01:51:23.076
THEIR TAKE HOME PAY ON THE

01:51:23.143 --> 01:51:25.578
BASIC COST OF UTILITIES, THE

01:51:25.645 --> 01:51:26.613
CURRENT WE'RE CONSTRAINED BY

01:51:26.679 --> 01:51:27.814
LAW. THIS ISN'T A CHOICE. WE

01:51:27.881 --> 01:51:29.182
DON'T HAVE THE ABILITY TO

01:51:29.249 --> 01:51:30.717
CHARGE BASED ON INCOME OR ANY

01:51:30.784 --> 01:51:32.052
OTHER KIND OF METRICS. SO THIS

01:51:32.118 --> 01:51:33.920
IS, YOU KNOW, A SORT OF AN

01:51:33.987 --> 01:51:36.356
OBLIGATION OF OURS. AND, YOU

01:51:36.423 --> 01:51:37.791
KNOW, THE CHALLENGE THAT WE

01:51:37.857 --> 01:51:39.292
FACE IS SORT OF TWOFOLD. HOW DO

01:51:39.359 --> 01:51:40.427
WE CONTINUE TO FUND THESE

01:51:40.493 --> 01:51:42.162
PROJECTS THAT ARE GETTING MORE

01:51:42.228 --> 01:51:43.229
EXPENSIVE, BUT THEN ACTUALLY

01:51:43.296 --> 01:51:44.697
ALSO ALLOCATE THE COSTS IN AN

01:51:44.764 --> 01:51:46.533
EQUITABLE MANNER? AND THAT IS

01:51:46.599 --> 01:51:49.369
MY PRESENTATION. THANK YOU.

01:51:49.436 --> 01:51:50.804
OKAY. THANK YOU, MR. ZUKA. MISS

01:51:50.870 --> 01:51:52.539
COMPTON, WELCOME. THANK YOU SO

01:51:52.605 --> 01:51:53.640
MUCH FOR HAVING ME. I'M

01:51:53.706 --> 01:51:54.707
CHRISTINE COMPTON AND I'M WITH

01:51:54.774 --> 01:51:55.875
IRVINE RANCH WATER DISTRICT. WE

01:51:55.942 --> 01:51:58.344
ARE ONE OF THE TEN LARGEST

01:51:58.411 --> 01:52:00.180
RETAIL WATER AGENCIES IN THE

01:52:00.246 --> 01:52:01.748
STATE, WHICH MEANS WE ACTUALLY

01:52:01.815 --> 01:52:03.149
ARE THE ONES WHO BUILD DIRECTLY

01:52:03.216 --> 01:52:04.784
THE CUSTOMERS FOR THE SERVICES

01:52:04.851 --> 01:52:06.653
WE PROVIDE. WE PROVIDE FOUR

01:52:06.719 --> 01:52:08.788
LINES OF SERVICE TO OUR

01:52:08.855 --> 01:52:10.623
CUSTOMERS, WHICH FEED INTO KIND

01:52:10.690 --> 01:52:13.126
OF THE OTHER PANELISTS TODAY,

01:52:13.193 --> 01:52:14.561
OBVIOUSLY, WATER SERVICE, WHICH

01:52:14.627 --> 01:52:16.329
IS THE TOPIC SEWER SERVICE,

01:52:16.396 --> 01:52:17.764
RECYCLED WATER, AND THEN URBAN

01:52:17.831 --> 01:52:19.199
RUNOFF TREATMENT BECAUSE OF THE

01:52:19.265 --> 01:52:21.000
WATERSHED THAT WE'RE IN. WHAT

01:52:21.067 --> 01:52:23.136
THAT MEANS IN SERVING 20% OF

01:52:23.203 --> 01:52:25.738
ORANGE COUNTY IS WE HAVE A A

01:52:25.805 --> 01:52:27.540
DAYTIME POPULATION BECAUSE

01:52:27.607 --> 01:52:29.008
THERE'S TONS OF BUSINESS IN OUR

01:52:29.075 --> 01:52:30.877
AREA. AND IT'S A HUGE PART OF

01:52:30.944 --> 01:52:32.579
THE STATE'S ECONOMY OF OVER

01:52:32.645 --> 01:52:35.148
600,000, PROBABLY APPROACHING

01:52:35.215 --> 01:52:36.182
650,000, AND A NIGHTTIME

01:52:36.249 --> 01:52:39.052
RESIDENTIAL POPULATION OF ABOUT

01:52:39.119 --> 01:52:40.854
450,000. SO WITH THAT, WE'VE

01:52:40.920 --> 01:52:42.288
DONE A LOT OF THE THINGS THE

01:52:42.355 --> 01:52:43.756
LEGISLATURE WOULD HAVE WANT

01:52:43.823 --> 01:52:46.226
EVERY WATER AGENCY TO DO. OVER

01:52:46.292 --> 01:52:47.994
50% OF OUR WATER SUPPLY IS FROM

01:52:48.061 --> 01:52:51.631
WATER THAT'S REUSED. WE HAVE

01:52:51.698 --> 01:52:53.433
INVESTED HEAVILY IN WATER

01:52:53.500 --> 01:52:54.033
CONSERVATION. WE HAVE SOME OF

01:52:54.100 --> 01:52:57.403
THE LOWEST WATER USES IN THE

01:52:57.470 --> 01:52:59.205
STATE. WE HAVE AN EXTENSIVE

01:52:59.272 --> 01:53:00.607
COST TO SERVICE THAT'S

01:53:00.673 --> 01:53:01.708
ALLOCATING ALL THE COSTS THAT

01:53:01.774 --> 01:53:03.510
YOU'VE HEARD OF TODAY DIRECTLY

01:53:03.576 --> 01:53:04.777
TO THE PROPORTIONAL SERVICE OF

01:53:04.844 --> 01:53:07.147
OUR CUSTOMERS. AND WE'VE DONE

01:53:07.213 --> 01:53:08.882
THINGS THAT ARE LOOKING AT OUR

01:53:08.948 --> 01:53:10.750
WATER WATER RELIABILITY GOING

01:53:10.817 --> 01:53:12.886
OUT. SO WE HAVE WATER

01:53:12.952 --> 01:53:13.987
RELIABILITY STUDIES LOOKING AT

01:53:14.053 --> 01:53:16.523
ALL THE BAD, REASONABLY

01:53:16.589 --> 01:53:17.190
FORESEEABLE THINGS THAT YOU CAN

01:53:17.257 --> 01:53:18.958
DO TO MAKE SURE THAT WE CAN BE

01:53:19.025 --> 01:53:20.793
RELIABLE TO OUR CUSTOMERS. ALL

01:53:20.860 --> 01:53:21.895
OF THOSE THINGS. WHEN YOU

01:53:21.961 --> 01:53:23.663
FACTOR IN, THEN CLIMATE CHANGE

01:53:23.730 --> 01:53:25.431
MEANS THERE ARE INFRASTRUCTURE

01:53:25.498 --> 01:53:26.232
INVESTMENTS THAT NEED TO BE

01:53:26.299 --> 01:53:27.967
MADE. BUT WE'RE ALSO A

01:53:28.034 --> 01:53:29.836
COMMUNITY THAT IS CONTINUING TO

01:53:29.903 --> 01:53:31.905
GROW. AND SO WE HAVE LOTS OF

01:53:31.971 --> 01:53:34.807
HOUSING STILL COMING ON IN OUR

01:53:34.874 --> 01:53:36.442
SERVICE AREA. AND SO WHAT I'VE

01:53:36.509 --> 01:53:38.077
BEEN ASKED TO TALK TO YOU TODAY

01:53:38.144 --> 01:53:39.846
ABOUT IS HOW DO WE ASSESS THOSE

01:53:39.913 --> 01:53:41.347
INFRASTRUCTURE NEEDS? HOW DO WE

01:53:41.414 --> 01:53:42.882
ASSESS THE NEED FOR THE GROWTH

01:53:42.949 --> 01:53:43.983
THAT WE'RE SEEING? AND THEN HOW

01:53:44.050 --> 01:53:46.753
DO WE PAY FOR IT? AND SO WE ARE

01:53:46.819 --> 01:53:50.056
AT IRWD, A SOPHISTICATED AGENCY.

01:53:50.123 --> 01:53:51.958
AND SO, AS I SAID, WE START

01:53:52.025 --> 01:53:54.260
WITH LOOKING AT WATER

01:53:54.327 --> 01:53:55.361
RELIABILITY FOR OUR CUSTOMERS

01:53:55.428 --> 01:53:57.964
AND THE GROWTH. AND SO WE HAVE

01:53:58.031 --> 01:53:59.666
AN EXTENSIVE STUDY THAT GOES

01:53:59.732 --> 01:54:01.134
INTO THAT. AND I'D BE MORE THAN

01:54:01.201 --> 01:54:03.002
HAPPY TO TALK TO YOU, BUT I

01:54:03.069 --> 01:54:04.170
REALLY WANT TO FOCUS ON THE

01:54:04.237 --> 01:54:06.072
GROWTH. HOW DO WE KNOW WHAT'S

01:54:06.139 --> 01:54:07.240
COMING AND HOW DO WE ANTICIPATE

01:54:07.307 --> 01:54:10.109
AND PLAN FOR THAT? AND SO WE AT

01:54:10.176 --> 01:54:11.945
IRWD HAVE VERY GOOD

01:54:12.011 --> 01:54:13.046
RELATIONSHIPS WITH OUR LAND USE

01:54:13.112 --> 01:54:14.247
AGENCIES. AND SO WE'RE TALKING

01:54:14.314 --> 01:54:15.848
TO THEM REGULARLY ABOUT WHAT

01:54:15.915 --> 01:54:17.317
THEY'RE DOING IN THEIR GENERAL

01:54:17.383 --> 01:54:18.718
PLANS AND THE CHANGING SO WE

01:54:18.785 --> 01:54:20.553
CAN ACCOMMODATE THAT AND PUT

01:54:20.620 --> 01:54:22.689
THEM INTO THE PLANS THAT WE'RE

01:54:22.755 --> 01:54:23.423
DEVELOPING FOR THE

01:54:23.489 --> 01:54:24.824
INFRASTRUCTURE WE NEED TO SERVE

01:54:24.891 --> 01:54:27.427
OUR COMMUNITY AND THOSE NEW

01:54:27.493 --> 01:54:28.461
DEVELOPMENTS THAT ARE COMING ON

01:54:28.528 --> 01:54:30.630
BOARD. WE ALSO TALK TO OUR

01:54:30.697 --> 01:54:32.065
DEVELOPERS AT LENGTH, SO WE'RE

01:54:32.131 --> 01:54:33.466
GETTING THE MOST UP TO DATE

01:54:33.533 --> 01:54:34.968
INFORMATION. AND WE HAVE WHAT'S

01:54:35.034 --> 01:54:36.703
CALLED A WATER RESOURCE MASTER

01:54:36.769 --> 01:54:38.571
PLAN. THAT WATER RESOURCE

01:54:38.638 --> 01:54:40.773
MASTER PLAN TAKES THAT

01:54:40.840 --> 01:54:42.175
INFORMATION THAT WE'RE GETTING

01:54:42.242 --> 01:54:43.977
ON. YOU KNOW WHAT FOLKS ARE

01:54:44.043 --> 01:54:45.078
PLANNING AND COMING AND THE

01:54:45.144 --> 01:54:47.180
APPROVED LAND USES. SO WE CAN

01:54:47.247 --> 01:54:48.715
PUT THAT INTO THE EXISTING USES

01:54:48.781 --> 01:54:51.150
THAT WE HAVE. THAT INCLUDES

01:54:51.217 --> 01:54:52.885
REDEVELOPMENT AND GREENFIELD

01:54:52.952 --> 01:54:54.053
DEVELOPMENT, AND THEN PLAN FOR

01:54:54.120 --> 01:54:56.122
THE INFRASTRUCTURE WE NEED. SO

01:54:56.189 --> 01:54:59.058
WHETHER THAT'S, YOU KNOW, WE

01:54:59.125 --> 01:55:00.860
HAVE OUR WATER SUPPLIES, THE

01:55:00.927 --> 01:55:02.996
PIPES IN THE GROUND, OUR

01:55:03.062 --> 01:55:04.163
RESERVOIRS, WHAT DO WE NEED FOR

01:55:04.230 --> 01:55:06.566
FIRE FLOW IN THOSE COMMUNITIES

01:55:06.633 --> 01:55:08.801
ALL BASED. AND WE FACTOR THAT

01:55:08.868 --> 01:55:12.005
IN USING. WE YOU KNOW, HOW MUCH

01:55:12.071 --> 01:55:14.207
ARE EACH HOUSE HOUSING UNIT

01:55:14.274 --> 01:55:15.675
USES? WE KNOW HOW MUCH BUSINESS

01:55:15.742 --> 01:55:17.310
USE. AND SO WE USE THOSE DEMAND

01:55:17.377 --> 01:55:18.878
FACTORS IN IN THAT FULL

01:55:18.945 --> 01:55:20.280
ANALYSIS THAT WE ALSO DO THIS

01:55:20.346 --> 01:55:22.415
ON OUR SEWER SIDE. SO FULLY IN

01:55:22.482 --> 01:55:24.284
ON THE INFRASTRUCTURE. SO WE

01:55:24.350 --> 01:55:26.819
CAN ALLOCATE THOSE. ONCE WE

01:55:26.886 --> 01:55:28.454
HAVE THAT, WE'RE ABLE TO PLAN

01:55:28.521 --> 01:55:29.689
AHEAD AND WE LOOK VERY, VERY

01:55:29.756 --> 01:55:31.491
FAR AHEAD. ADDITIONALLY, I JUST

01:55:31.557 --> 01:55:33.092
WANTED TO NOTE, BECAUSE THE

01:55:33.159 --> 01:55:34.193
OTHER QUESTION THAT COMES UP IN

01:55:34.260 --> 01:55:35.828
THIS CONVERSATION IS GREAT.

01:55:35.895 --> 01:55:37.163
YOU'RE PLANNING FOR THE FUTURE,

01:55:37.230 --> 01:55:38.398
BUT HOW DO YOU MAINTAIN YOUR

01:55:38.464 --> 01:55:40.867
EXISTING INFRASTRUCTURE? AND AT

01:55:40.933 --> 01:55:42.268
IRWD, WE HAVE A REPLACEMENT

01:55:42.335 --> 01:55:44.003
MODEL. WE'RE LOOKING AT ALL OF

01:55:44.070 --> 01:55:45.204
OUR CURRENT INFRASTRUCTURE.

01:55:45.271 --> 01:55:47.006
WE'RE EVALUATING ITS USEFUL

01:55:47.073 --> 01:55:48.808
LIFE, AND THAT MODEL GOES OUT

01:55:48.875 --> 01:55:50.576
DECADES. SO WE'RE PLANNING

01:55:50.643 --> 01:55:51.711
AHEAD FOR THE REPLACEMENT OF

01:55:51.778 --> 01:55:53.846
ALL OF THAT IN OUR RATES. ALL

01:55:53.913 --> 01:55:55.682
OF THOSE THINGS COME INTO PLAY.

01:55:55.748 --> 01:55:58.117
BUT IT MEANS THAT NO MATTER

01:55:58.184 --> 01:56:00.253
WHAT OUR LOCAL COMMUNITY

01:56:00.320 --> 01:56:02.088
DEVELOPMENT IS, WE'RE PLANNING

01:56:02.155 --> 01:56:03.890
AHEAD FOR THE SERVICES TO SERVE

01:56:03.956 --> 01:56:06.793
THEM AND ALLOCATING THOSE COSTS.

01:56:06.859 --> 01:56:08.027
ALL OF THIS WE'VE BEEN ABLE TO

01:56:08.094 --> 01:56:09.929
DO, AND WE HAVE THE LOWEST

01:56:09.996 --> 01:56:11.064
WATER RATES IN ORANGE COUNTY.

01:56:11.130 --> 01:56:13.666
SO THAT'S OUR INTENT, IS TO TRY

01:56:13.733 --> 01:56:15.535
AND KEEP THINGS AS LOW AS

01:56:15.601 --> 01:56:16.703
POSSIBLE. BUT AS MY COLLEAGUES

01:56:16.769 --> 01:56:17.704
HAVE SAID, WE'RE ALL SEEING

01:56:17.770 --> 01:56:19.739
UPWARD COST PRESSURES. AND SO

01:56:19.806 --> 01:56:21.174
WHEN WE LOOK AT THIS

01:56:21.240 --> 01:56:22.642
INFRASTRUCTURE, THERE'S THREE

01:56:22.709 --> 01:56:24.010
CATEGORIES OF FUNDING THAT

01:56:24.077 --> 01:56:25.611
BASICALLY CAN FUND IT. WE CAN

01:56:25.678 --> 01:56:29.449
USE OUR RATES, WE CAN USE DEBT

01:56:29.515 --> 01:56:30.850
FINANCING, WHICH WE DO WHEN IT

01:56:30.917 --> 01:56:32.719
MAKES SENSE. AND THEN THERE ARE

01:56:32.785 --> 01:56:34.087
GRANTS. ALL OF THOSE

01:56:34.153 --> 01:56:35.188
ESSENTIALLY COME INTO PLAY

01:56:35.254 --> 01:56:37.056
BECAUSE DEBT FINANCING ENDS UP

01:56:37.123 --> 01:56:38.791
GOING INTO RATES MEAN THAT THE

01:56:38.858 --> 01:56:40.560
ONLY CATEGORY THAT DOESN'T

01:56:40.626 --> 01:56:42.795
AFFECT AFFORDABILITY IS FEDERAL

01:56:42.862 --> 01:56:44.597
AND STATE GRANT FUNDING

01:56:44.664 --> 01:56:46.733
OPPORTUNITIES. AND SO WITH

01:56:46.799 --> 01:56:47.800
AFFORDABILITY, WHAT WE'RE

01:56:47.867 --> 01:56:51.070
SEEING IN MY AREA AND ACROSS

01:56:51.137 --> 01:56:52.839
THE STATE WITH WATER RETAILERS

01:56:52.905 --> 01:56:55.375
IS THERE'S ESSENTIALLY SIX

01:56:55.441 --> 01:56:56.476
CATEGORIES THAT ARE DRIVING

01:56:56.542 --> 01:56:58.010
UPWARD COST PRESSURE ON RATES

01:56:58.077 --> 01:56:59.312
AND AFFECTING AFFORDABILITY.

01:56:59.379 --> 01:57:00.980
AND THAT GOES INTO WHAT YOU CAN

01:57:01.047 --> 01:57:02.715
ALSO DO WITH INFRASTRUCTURE AND

01:57:02.782 --> 01:57:04.717
HOW MUCH YOU CAN PUT TOWARDS

01:57:04.784 --> 01:57:06.219
BEING ABLE TO ADAPT FOR CLIMATE

01:57:06.285 --> 01:57:08.721
CHANGE AND WHIPLASH. SO THE SIX

01:57:08.788 --> 01:57:10.156
CATEGORIES THAT WE'VE

01:57:10.223 --> 01:57:11.224
IDENTIFIED, A COLLEAGUE OF MINE,

01:57:11.290 --> 01:57:12.291
DANIELLE COATES, AT RANCHO

01:57:12.358 --> 01:57:13.426
CALIFORNIA, HAVE SPENT A LOT OF

01:57:13.493 --> 01:57:14.794
TIME IN THIS AFFORDABILITY

01:57:14.861 --> 01:57:18.064
SPACE, ENERGY COSTS ARE A

01:57:18.131 --> 01:57:20.566
DIRECT INPUT TO WATER AND SEWER.

01:57:20.633 --> 01:57:22.335
THEY JUST ARE. AND YOU ALL ARE

01:57:22.402 --> 01:57:23.770
DEBATING THOSE COSTS AND OTHER

01:57:23.836 --> 01:57:26.339
FORUMS UP HERE. CHEMICAL COSTS.

01:57:26.406 --> 01:57:28.141
WE HAVE TO BUY CHEMICALS TO

01:57:28.207 --> 01:57:29.876
TREAT WATER TO ENSURE IT'S SAFE.

01:57:29.942 --> 01:57:32.111
SAME WITH SEWER TO TREAT IT

01:57:32.178 --> 01:57:33.179
THOSE THAT'S DRIVEN BY THE

01:57:33.246 --> 01:57:34.147
GLOBAL MARKETPLACE. AND SO

01:57:34.213 --> 01:57:36.082
THERE'S NOT A WHOLE LOT WE CAN

01:57:36.149 --> 01:57:37.350
ALL DO TO AFFECT AND BRING DOWN

01:57:37.417 --> 01:57:38.918
THOSE COSTS. CURRENTLY THE

01:57:38.985 --> 01:57:40.386
STAFF COSTS, IT'S JUST THE COST

01:57:40.453 --> 01:57:42.221
OF LIVING IN CALIFORNIA, AND IT

01:57:42.288 --> 01:57:43.956
TAKES BODIES TO BE ABLE TO

01:57:44.023 --> 01:57:45.425
PROVIDE THESE SERVICES IN A

01:57:45.491 --> 01:57:47.059
SAFE AND HEALTHY WAY, AND TO

01:57:47.126 --> 01:57:48.327
ENSURE THAT FOLKS HAVE THE

01:57:48.394 --> 01:57:50.096
RIGHT CERTIFICATES AND TRAINING

01:57:50.163 --> 01:57:51.664
TO BE ABLE TO DO THAT. SO WE'RE

01:57:51.731 --> 01:57:52.732
PROTECTING THE PUBLIC BECAUSE

01:57:52.799 --> 01:57:54.567
AT THE END OF THE DAY, WATER

01:57:54.634 --> 01:57:56.402
AND SEWER SERVICE IS A PUBLIC

01:57:56.469 --> 01:57:58.337
HEALTH AND SAFETY ISSUE. WE

01:57:58.404 --> 01:57:59.806
ALSO HAVE REGULATORY COSTS.

01:57:59.872 --> 01:58:01.607
WE'VE SEEN A SUBSTANTIAL

01:58:01.674 --> 01:58:03.776
INCREASE FOR GOOD REASON. BUT

01:58:03.843 --> 01:58:06.646
IN IN THE COST IT TAKES TO

01:58:06.712 --> 01:58:08.781
COMPLY WITH REGULATIONS. AND

01:58:08.848 --> 01:58:09.849
THAT'S CONSERVATION COSTS,

01:58:09.916 --> 01:58:11.317
WATER QUALITY COSTS, ALL OF

01:58:11.384 --> 01:58:12.718
THOSE THINGS. BUT WE'VE SEEN

01:58:12.785 --> 01:58:14.086
HUGE INCREASES IN THE LAST

01:58:14.153 --> 01:58:15.221
DECADE IN THAT. AND THAT'S

01:58:15.288 --> 01:58:16.689
GOING DIRECTLY INTO RATES. THE

01:58:16.756 --> 01:58:19.258
LAST TWO ARE REALLY

01:58:19.325 --> 01:58:20.293
INFRASTRUCTURE COSTS. IT'S

01:58:20.359 --> 01:58:22.462
TAKING A LOT MORE TO BUILD

01:58:22.528 --> 01:58:25.064
INFRASTRUCTURE. AT MY AGENCY IN

01:58:25.131 --> 01:58:27.567
THE LAST IN ABOUT THE IF YOU GO

01:58:27.633 --> 01:58:29.702
FROM LIKE SIX MONTHS BACK AND A

01:58:29.769 --> 01:58:31.103
YEAR OUT, WE'RE PROBABLY

01:58:31.170 --> 01:58:33.306
ISSUING CONTRACTS FOR ABOUT

01:58:33.372 --> 01:58:34.740
$1.5 BILLION WORTH OF

01:58:34.807 --> 01:58:35.842
INFRASTRUCTURE. WE HAVE DAM

01:58:35.908 --> 01:58:37.610
SAFETY PROJECTS WHERE WE HAVE

01:58:37.677 --> 01:58:39.378
NEW INFORMATION BASED ON

01:58:39.445 --> 01:58:41.214
CLIMATE CHANGE AND FLOOD

01:58:41.280 --> 01:58:42.281
PREDICTIONS, WHERE WE HAVE TO

01:58:42.348 --> 01:58:43.749
MAKE THOSE IMPROVEMENTS TO HALF

01:58:43.816 --> 01:58:45.251
$1 BILLION. AND THAT'S ONE OF

01:58:45.318 --> 01:58:46.319
THE CHEAPER PROJECTS. AND

01:58:46.385 --> 01:58:47.353
YOU'RE SEEING THOSE ACROSS THE

01:58:47.420 --> 01:58:49.088
STATE, BUT THERE'S 1.5 MILLION

01:58:49.155 --> 01:58:50.890
PEOPLE DOWNSTREAM WHO WOULD BE

01:58:50.957 --> 01:58:52.425
IMPACTED IF IT FAILS, AND

01:58:52.492 --> 01:58:53.459
ANOTHER MILLION PEOPLE THAT GET

01:58:53.526 --> 01:58:55.127
THEIR WATER SUPPLY FROM THAT.

01:58:55.194 --> 01:58:56.362
WE'RE SEEING OTHER COSTS LIKE

01:58:56.429 --> 01:58:57.797
THAT ACROSS THE BOARD. AND

01:58:57.864 --> 01:58:59.599
FINALLY, CLIMATE ADAPTATION

01:58:59.665 --> 01:59:02.502
COSTS. AND SO WITH THAT, MY

01:59:02.568 --> 01:59:04.237
COLLEAGUE DANIEL COATES AND I

01:59:04.303 --> 01:59:05.705
THOUGHT ABOUT, WELL, WE KNOW

01:59:05.771 --> 01:59:07.340
WHAT THE BUDGET SITUATION IS.

01:59:07.406 --> 01:59:08.574
WE KNOW THE AFFORDABILITY

01:59:08.641 --> 01:59:09.976
IMPACTS ON A THIRD OF

01:59:10.042 --> 01:59:12.178
CALIFORNIANS ARE AT THE 200% OF

01:59:12.245 --> 01:59:13.646
THE FEDERAL POVERTY LINE IN

01:59:13.713 --> 01:59:15.181
LOVE. AND SO THERE'S A LOT OF

01:59:15.248 --> 01:59:16.549
INTEREST IN HOW DO WE ADDRESS

01:59:16.616 --> 01:59:18.150
AND HELP THOSE HOUSEHOLDS UP.

01:59:18.217 --> 01:59:19.752
AS YOU'VE HEARD, WE'RE LIMITED

01:59:19.819 --> 01:59:21.487
BY PROP TWO TÍNH I CAN'T USE MY

01:59:21.554 --> 01:59:23.422
RATES TO DO THAT. AND SO WE

01:59:23.489 --> 01:59:24.457
WORKED REALLY HARD ON A

01:59:24.524 --> 01:59:25.925
PROPOSAL. THAT WAS BEFORE YOU

01:59:25.992 --> 01:59:28.694
ALL THIS LAST YEAR. AB 2739,

01:59:28.761 --> 01:59:30.162
THAT TOOK A SLIGHTLY DIFFERENT

01:59:30.229 --> 01:59:32.298
APPROACH TO HOW WE DEAL WITH

01:59:32.365 --> 01:59:34.867
COST DRIVERS OF RATES, WITH THE

01:59:34.934 --> 01:59:36.269
BUDGET AND LOW INCOME RATE

01:59:36.335 --> 01:59:37.703
ASSISTANCE. AND THE IDEA WAS TO

01:59:37.770 --> 01:59:39.872
CREATE A TRUST FUND TO SET

01:59:39.939 --> 01:59:42.041
ASIDE MONEY. SO THAT WAY, WHEN

01:59:42.108 --> 01:59:43.543
THERE WAS ASSUMING YOU ALL

01:59:43.609 --> 01:59:45.378
WOULD APPROPRIATE MONEY TO DEAL

01:59:45.444 --> 01:59:46.779
WITH INFRASTRUCTURE COSTS, BUT

01:59:46.846 --> 01:59:48.548
ALSO LOW INCOME RATES. AND

01:59:48.614 --> 01:59:50.383
AGAIN, I THINK I RAISED THAT AS

01:59:50.449 --> 01:59:51.751
AN EXAMPLE AND MORE THAN HAPPY

01:59:51.817 --> 01:59:53.953
TO TALK MORE ABOUT ANY OF THESE

01:59:54.020 --> 01:59:55.121
OR ANSWER YOUR QUESTIONS, BUT

01:59:55.187 --> 01:59:56.822
WE NEED TO THINK CREATIVELY TO

01:59:56.889 --> 01:59:58.624
ADDRESS THE AFFORDABILITY ISSUE.

01:59:58.691 --> 02:00:01.093
WE NEED TO MAKE GENERATIONAL

02:00:01.160 --> 02:00:02.595
INVESTMENTS IN OUR WATER

02:00:02.662 --> 02:00:04.430
SYSTEMS TO PREPARE FOR WHAT

02:00:04.497 --> 02:00:05.831
WE'RE ALREADY SEEING WITH THE

02:00:05.898 --> 02:00:07.266
IMPACTS OF CLIMATE CHANGE. BUT

02:00:07.333 --> 02:00:08.935
IT IS SOME OF THESE THINGS WE

02:00:09.001 --> 02:00:10.169
NEED TO THINK OUTSIDE THE BOX

02:00:10.236 --> 02:00:11.537
BECAUSE RESOURCES ARE LIMITED

02:00:11.604 --> 02:00:13.005
AND RATEPAYERS ARE FEELING THE

02:00:13.072 --> 02:00:14.140
PRESSURE. AND SO WE'RE TRYING

02:00:14.206 --> 02:00:16.075
TO DO THAT. AT IRWD. I KNOW MY

02:00:16.142 --> 02:00:17.143
COLLEAGUES IN THE WATER

02:00:17.209 --> 02:00:18.244
INDUSTRY ARE TRYING TO DO THAT,

02:00:18.311 --> 02:00:20.146
AND I THINK THAT'S WHY YOU SAW

02:00:20.212 --> 02:00:21.414
ON SOME OF THESE AFFORDABILITY

02:00:21.480 --> 02:00:23.749
BILLS ON WATER LAST YEAR

02:00:23.816 --> 02:00:25.284
PARTNERSHIPS AND COALITIONS

02:00:25.351 --> 02:00:26.352
THAT RANGE FROM THE

02:00:26.419 --> 02:00:27.753
ENVIRONMENTAL JUSTICE FOLKS,

02:00:27.820 --> 02:00:29.922
WATER BUSINESS, ENVIRONMENTAL,

02:00:29.989 --> 02:00:31.023
YOU KNOW, COALITIONS THAT ARE

02:00:31.090 --> 02:00:33.526
NORMALLY AT WAR IN WATER ALL

02:00:33.593 --> 02:00:35.061
COMING TOGETHER TO SAY, YES, WE

02:00:35.127 --> 02:00:36.796
NEED TO TACKLE THIS. SO WITH

02:00:36.862 --> 02:00:38.230
THAT, I WILL CONCLUDE MY

02:00:38.297 --> 02:00:39.332
COMMENTS, BUT I'M MORE THAN

02:00:39.398 --> 02:00:40.499
HAPPY TO ANSWER ANY QUESTIONS

02:00:40.566 --> 02:00:42.268
YOU HAVE AND DIVE DEEPER IF

02:00:42.335 --> 02:00:44.604
YOU'D LIKE. WELL, THANK YOU SO

02:00:44.670 --> 02:00:48.307
MUCH TO EACH OF YOU. AND IN

02:00:48.374 --> 02:00:50.476
ARTICULATING NOT ONLY THE

02:00:50.543 --> 02:00:51.844
CHALLENGES OF THE LOCAL FOLKS,

02:00:51.911 --> 02:00:53.679
BUT THEN THE ATTEMPTS TO TRY TO

02:00:53.746 --> 02:00:55.481
BE AS CREATIVE AS POSSIBLE

02:00:55.548 --> 02:00:56.749
GIVEN VARIOUS CONSTRAINTS,

02:00:56.816 --> 02:00:57.984
WHETHER THEY BE REGULATORY,

02:00:58.050 --> 02:00:59.418
WHETHER THEY BE JUST

02:00:59.485 --> 02:01:01.654
AFFORDABILITY ISSUES. DO WE

02:01:01.721 --> 02:01:03.823
HAVE ANY QUESTIONS FROM

02:01:03.889 --> 02:01:05.891
COLLEAGUES? I DO THANK YOU

02:01:05.958 --> 02:01:08.094
AGAIN FOR THOSE PRESENTATIONS.

02:01:08.160 --> 02:01:10.229
MR. I MAY HAVE MISUNDERSTOOD

02:01:10.296 --> 02:01:13.165
WHAT YOU EXPLAINED IN TERMS OF

02:01:13.232 --> 02:01:14.200
SEPARATING THE COST OF

02:01:14.266 --> 02:01:15.701
INFRASTRUCTURE. I BELIEVE YOU

02:01:15.768 --> 02:01:17.303
SAID THAT THAT COULD COME FROM

02:01:17.370 --> 02:01:19.338
FEDERAL GRANTS TO PLACE THE

02:01:19.405 --> 02:01:20.439
INFRASTRUCTURE NEEDED FOR WATER

02:01:20.506 --> 02:01:22.842
OR SEWER. THEN AT THE END, I

02:01:22.908 --> 02:01:24.176
BELIEVE THAT YOU SAID THAT.

02:01:24.243 --> 02:01:26.445
THEN AFTER YOU GET THOSE GRANTS

02:01:26.512 --> 02:01:28.714
TO PUT INFRASTRUCTURE, WHATEVER

02:01:28.781 --> 02:01:30.883
AMOUNT OF TIME TO PUT IT, THEN

02:01:30.950 --> 02:01:32.618
I MISUNDERSTOOD. MAYBE YOU SAID

02:01:32.685 --> 02:01:34.053
THAT, THEN THAT GETS PASSED ON

02:01:34.120 --> 02:01:36.555
TO THE USER SO THAT YOU CAN

02:01:36.622 --> 02:01:38.190
COME EVEN. SORRY IF I WASN'T

02:01:38.257 --> 02:01:39.892
CLEAR. NO, THE EXAMPLE I THINK

02:01:39.959 --> 02:01:41.527
I WAS HIGHLIGHTING WERE WAS

02:01:41.594 --> 02:01:43.696
THAT SB CW WHEN THE PLANT WAS

02:01:43.763 --> 02:01:45.531
BUILT, THAT WAS BACK IN THE 70S,

02:01:45.598 --> 02:01:46.966
THAT WAS DONE UNDER GRANTS

02:01:47.033 --> 02:01:48.401
ISSUED UNDER THE CLEAN WATER

02:01:48.467 --> 02:01:49.502
ACT THAT DIDN'T HIT THE

02:01:49.568 --> 02:01:51.671
RATEPAYERS AT ALL. THE MORE

02:01:51.737 --> 02:01:53.439
RECENT CAPITAL IMPROVEMENT

02:01:53.506 --> 02:01:55.241
PROGRAM, WE DO HAVE LOANS FROM

02:01:55.307 --> 02:01:56.676
THE FEDERAL, YOU KNOW, EITHER

02:01:56.742 --> 02:01:58.878
UNDER STATE ADMINISTERED SRF OR

02:01:58.944 --> 02:02:00.946
WIFIA. SO THEY'RE LOW INTEREST

02:02:01.013 --> 02:02:02.515
RATE. I MEAN, I THINK OUR OUR

02:02:02.581 --> 02:02:04.650
WEIGHTED COST OF DEBT IS AROUND

02:02:04.717 --> 02:02:06.752
1.6%, WHICH IS A GREAT RATE.

02:02:06.819 --> 02:02:07.987
BUT ALL OF THE COST OF THOSE

02:02:08.054 --> 02:02:10.056
LOANS IS BEING BORNE BY THE

02:02:10.122 --> 02:02:11.791
RATEPAYERS CURRENTLY. SO THE

02:02:11.857 --> 02:02:13.125
POINT THAT I WAS TRYING TO

02:02:13.192 --> 02:02:14.694
ARTICULATE IS THAT THE ORIGINAL

02:02:14.760 --> 02:02:16.128
CONSTRUCTION OF THIS

02:02:16.195 --> 02:02:18.297
INFRASTRUCTURE WAS ESSENTIALLY

02:02:18.364 --> 02:02:19.765
85% PAID FOR BY THE FEDERAL

02:02:19.832 --> 02:02:21.901
GOVERNMENT. AND SO THE FIRST 30

02:02:21.967 --> 02:02:23.769
YEARS OF RATES WAS JUST A

02:02:23.836 --> 02:02:25.871
STRAIGHT O&M. THERE WAS NO

02:02:25.938 --> 02:02:27.640
CAPITAL ELEMENT TO IT. AND NOW

02:02:27.707 --> 02:02:29.108
WE'RE LAYERING ON TOP OF THE

02:02:29.175 --> 02:02:30.543
STRAIGHT O&M, ALL OF THE

02:02:30.609 --> 02:02:31.677
CAPITAL REPLACEMENT COSTS THAT

02:02:31.744 --> 02:02:34.113
COME WITH AN AGING, THE AGING

02:02:34.180 --> 02:02:35.281
INFRASTRUCTURE. AND SO AS A

02:02:35.347 --> 02:02:37.083
RESULT, THERE'S NO THERE'S NO

02:02:37.149 --> 02:02:38.451
BASIS IN THE RATE. YOU'RE

02:02:38.517 --> 02:02:39.919
STARTING ALMOST FROM ZERO,

02:02:39.985 --> 02:02:42.188
RIGHT ON THE CAPITAL SIDE.

02:02:42.254 --> 02:02:43.355
THANKS FOR THAT CLARIFICATION.

02:02:43.422 --> 02:02:45.691
THANK YOU. MR. IT WAS THE GOOD

02:02:45.758 --> 02:02:48.561
OLD DAYS, FREE FEDERAL MONEY.

02:02:48.627 --> 02:02:49.962
THAT'S RIGHT. I DON'T KNOW

02:02:50.029 --> 02:02:52.131
ABOUT FREE, BUT NONETHELESS,

02:02:52.198 --> 02:02:53.165
CERTAINLY EASIER ON THE

02:02:53.232 --> 02:02:54.600
RATEPAYERS TAXPAYERS AT SOME

02:02:54.667 --> 02:02:58.637
POINT. BUT DO WE STILL HAVE THE

02:02:58.704 --> 02:03:01.140
ATTORNEY WITH US? I'M STILL

02:03:01.207 --> 02:03:03.676
HERE. OH, GREAT. SO I GOT A

02:03:03.743 --> 02:03:05.845
QUESTION FOR YOU. WHO'S

02:03:05.911 --> 02:03:07.646
LITIGATING THESE PROP 218

02:03:07.713 --> 02:03:10.116
CHALLENGES AND WHATNOT? AND IT

02:03:10.182 --> 02:03:11.884
IS THAT DO YOU SEE ANY TWEAKS

02:03:11.951 --> 02:03:13.452
THAT COULD BE MADE TO PROP 218

02:03:13.519 --> 02:03:16.622
THAT WOULD MAKE IT EASIER,

02:03:16.689 --> 02:03:17.723
WHILE AT THE SAME TIME

02:03:17.790 --> 02:03:19.158
MAINTAINING TRANSPARENCY TO THE

02:03:19.225 --> 02:03:21.660
PUBLIC? WHEN YOU WHEN YOU WHEN

02:03:21.727 --> 02:03:23.162
YOU'RE GOING BY THINGS LIKE, OH,

02:03:23.229 --> 02:03:24.930
YEAH, YOUR AVERAGE NOTICE IS AT

02:03:24.997 --> 02:03:27.433
LEAST WHAT DID YOU SAY $250

02:03:27.500 --> 02:03:29.201
NOTICE. YEAH. AND THAT AIN'T A

02:03:29.268 --> 02:03:30.669
CHEAP DATE BY ANY MEANS. SO

02:03:30.736 --> 02:03:32.171
ANYWAY, YOU GOT ANY SUGGESTIONS

02:03:32.238 --> 02:03:35.708
ABOUT PROP 218 THAT WOULD MAYBE

02:03:35.775 --> 02:03:37.810
MAKE IT LESS OF AN ONEROUS

02:03:37.877 --> 02:03:39.011
PROCESS, WHILE AT THE SAME TIME

02:03:39.078 --> 02:03:41.480
MAINTAINING TRANSPARENCY, WE

02:03:41.547 --> 02:03:43.649
COULD MAKE THE, THE, THE NOTICE

02:03:43.716 --> 02:03:46.886
HEARING PROCESS A LITTLE MORE

02:03:46.952 --> 02:03:47.987
EFFICIENT. YOU COULD USE MORE

02:03:48.053 --> 02:03:49.355
ELECTRONIC COMMUNICATION AND

02:03:49.421 --> 02:03:55.861
LESS US MAIL. WE COULD ALSO

02:03:55.928 --> 02:03:58.798
RECOGNIZE THAT ASKING COURTS TO

02:03:58.864 --> 02:04:00.566
REVIEW RATE MAKING IS A BAD

02:04:00.633 --> 02:04:03.068
IDEA, AT LEAST ASKING COURTS TO

02:04:03.135 --> 02:04:05.237
DO IT IN A HANDS ON, SECOND

02:04:05.304 --> 02:04:07.006
GUESSING KIND OF WAY. BECAUSE

02:04:07.072 --> 02:04:08.674
MANY OF US WENT TO LAW SCHOOL

02:04:08.741 --> 02:04:09.909
BECAUSE WE DON'T LIKE MATH, AND

02:04:09.975 --> 02:04:11.677
JUDGES ARE DRAWN FROM THE RANKS

02:04:11.744 --> 02:04:12.812
OF LAWYERS. AND SO IF YOU'RE

02:04:12.878 --> 02:04:13.779
JUST LOOKING AT THE

02:04:13.846 --> 02:04:14.947
INSTITUTIONAL COMPETENCY OF THE

02:04:15.014 --> 02:04:16.782
PLAYERS IN OUR DEMOCRACY,

02:04:16.849 --> 02:04:17.950
JUDGES ARE NOT WELL SUITED TO

02:04:18.017 --> 02:04:19.752
THIS TASK. AND SO THE CHOICE

02:04:19.819 --> 02:04:21.754
THE VOTERS MADE IN PROP 218 TO

02:04:21.821 --> 02:04:23.556
OVER LITIGATE THESE DISPUTES

02:04:23.622 --> 02:04:25.724
HAS PROVEN VERY COSTLY AND VERY

02:04:25.791 --> 02:04:28.661
EXPENSIVE. MY HUNCH IS THAT

02:04:28.727 --> 02:04:29.728
POLITICALLY, IT WOULDN'T BE

02:04:29.795 --> 02:04:31.096
POSSIBLE TO MAKE THAT KIND OF A

02:04:31.163 --> 02:04:32.965
CHANGE TO PROP 218 UNLESS IT

02:04:33.032 --> 02:04:35.134
HAD AN ENVIRONMENTAL BENEFIT,

02:04:35.201 --> 02:04:36.502
AND WE WOULD HAVE TO WORK WITH

02:04:36.569 --> 02:04:37.469
OUR FRIENDS IN THE

02:04:37.536 --> 02:04:38.704
ENVIRONMENTAL MOVEMENT TO FRAME

02:04:38.771 --> 02:04:41.941
A CHANGE TO PROP 218 THAT WOULD

02:04:42.007 --> 02:04:43.342
ADVANCE IN A LEGITIMATE WAY.

02:04:43.409 --> 02:04:45.511
OUR OUR GREEN UTILITY SUPPLY

02:04:45.578 --> 02:04:47.012
GOALS AND STILL MAKE THINGS

02:04:47.079 --> 02:04:54.153
LESS COSTLY AND LESS LITIGIOUS.

02:04:54.220 --> 02:04:58.157
OKAY. THANK YOU SO MUCH. WITH

02:04:58.224 --> 02:04:58.924
THAT, UNLESS THERE'S ANY

02:04:58.991 --> 02:05:00.326
QUESTIONS FROM THE PANEL, SOME

02:05:00.392 --> 02:05:02.862
MEMBER HEARTS. THANK YOU. THANK

02:05:02.928 --> 02:05:04.296
YOU, CHAIR PAPPIN AND CHAIR

02:05:04.363 --> 02:05:05.664
CARRILLO FOR HAVING THIS

02:05:05.731 --> 02:05:07.867
HEARING. MR. ZUCKER, YOUR

02:05:07.933 --> 02:05:09.668
CHARTS WERE REALLY HELPFUL AND

02:05:09.735 --> 02:05:13.205
ILLUSTRATIVE AND VERY SCARY. I

02:05:13.272 --> 02:05:14.640
ASSUME THAT THAT WAS BY DESIGN,

02:05:14.707 --> 02:05:17.209
THE EXPERIENCE THAT YOU HAVE

02:05:17.276 --> 02:05:18.677
DEMONSTRATED THERE WITH, YOU

02:05:18.744 --> 02:05:21.146
KNOW, THE ESSENTIALLY FREE

02:05:21.213 --> 02:05:23.015
WATER FACILITIES AT THE

02:05:23.082 --> 02:05:24.183
BEGINNING ARE DUPLICATED ACROSS

02:05:24.250 --> 02:05:25.551
THE WHOLE STATE. AND THAT'S

02:05:25.618 --> 02:05:26.952
BASICALLY HOW OUR SYSTEM WAS

02:05:27.019 --> 02:05:28.087
BUILT, WAS THE WHOLE COUNTRY

02:05:28.153 --> 02:05:29.088
THAT WAS FEDERAL FEDERAL

02:05:29.154 --> 02:05:30.189
DOLLARS AS A RESULT OF THE

02:05:30.256 --> 02:05:32.124
CLEAN WATER ACT. SO IT AFFECTED

02:05:32.191 --> 02:05:33.125
THE WASTEWATER SIDE, OBVIOUSLY

02:05:33.192 --> 02:05:34.260
MORE THAN THE WATER. BUT YES,

02:05:34.326 --> 02:05:37.062
IT WAS IT WAS NATIONWIDE. AND

02:05:37.129 --> 02:05:39.598
SO, AS YOU SAID, IF YOU PROJECT

02:05:39.665 --> 02:05:42.735
OUT BEYOND THE SCALE OF YOUR

02:05:42.801 --> 02:05:44.570
CHART, THAT THAT'S NOT GOING

02:05:44.637 --> 02:05:46.038
BACK DOWN TO A PLACE WHERE

02:05:46.105 --> 02:05:47.106
WE'RE GOING TO JUST BE

02:05:47.172 --> 02:05:48.107
OPERATING EQUIPMENT THAT HAS

02:05:48.173 --> 02:05:49.275
BEEN REPLACED AND IMPROVED,

02:05:49.341 --> 02:05:51.777
IT'S GOING TO JUST CONTINUE AT

02:05:51.844 --> 02:05:53.512
THESE HIGHER RATES. AND THAT IS

02:05:53.579 --> 02:05:54.980
A SOBERING FACT TO COME OUT OF

02:05:55.047 --> 02:05:56.482
THIS HEARING THAT I DIDN'T

02:05:56.548 --> 02:05:58.317
EXPECT. SO YEAH, IT IS IT IS

02:05:58.384 --> 02:05:59.952
VERY SOBERING. AND THAT'S WHY

02:06:00.019 --> 02:06:01.053
THAT CHART, WHEN WE PUT IT

02:06:01.120 --> 02:06:02.154
TOGETHER, WE WERE SHOCKED

02:06:02.221 --> 02:06:03.222
OURSELVES AT HOW ILLUSTRATIVE

02:06:03.289 --> 02:06:05.024
IT WAS OF THE PROBLEM. IT DOES

02:06:05.090 --> 02:06:06.225
ALSO PAINT A LIGHT THAT MAYBE

02:06:06.292 --> 02:06:07.993
OVER THE LAST 30 YEARS, WE

02:06:08.060 --> 02:06:09.128
SHOULD HAVE BEEN COLLECTING

02:06:09.194 --> 02:06:10.162
MORE THAN JUST O&M COSTS. I

02:06:10.229 --> 02:06:12.064
MEAN, THAT IS ALSO PART OF THE

02:06:12.131 --> 02:06:13.933
MESSAGE. BUT I THINK WHAT IT

02:06:13.999 --> 02:06:15.100
HIGHLIGHTS IS THAT WE GOT INTO

02:06:15.167 --> 02:06:16.302
SOME OF THIS INFRASTRUCTURE

02:06:16.368 --> 02:06:17.336
UNDER THE ASSUMPTION THAT WE'RE

02:06:17.403 --> 02:06:19.038
JUST PAYING OVER THIS, YOU KNOW,

02:06:19.104 --> 02:06:20.239
PAYING THE COST YEAR OVER YEAR,

02:06:20.306 --> 02:06:21.941
NOT REALIZING THAT THEY'RE ALL

02:06:22.007 --> 02:06:23.108
THEY'RE ALL GOLDEN GATE BRIDGES,

02:06:23.175 --> 02:06:24.143
THEY'RE ALL GOING TO, YOU'RE

02:06:24.209 --> 02:06:26.045
GOING TO GET TO THE END AND

02:06:26.111 --> 02:06:27.212
YOU'RE GOING TO START OVER AND

02:06:27.279 --> 02:06:29.114
YOU'RE GONNA GET TO THE END AND

02:06:29.181 --> 02:06:30.950
YOU'RE GOING TO START OVER. SO

02:06:31.016 --> 02:06:32.251
WE NEED TO BE DEALING WITH THE

02:06:32.318 --> 02:06:33.118
INFRASTRUCTURE MORE ON A

02:06:33.185 --> 02:06:35.054
LIFECYCLE BASIS, NOT ON A TEN

02:06:35.120 --> 02:06:36.989
YEAR SEE IP BASIS, WHICH IS HOW

02:06:37.056 --> 02:06:38.023
I THINK MUNICIPALITIES TEND TO

02:06:38.090 --> 02:06:39.191
THINK. LET'S LINE UP THE WORK

02:06:39.258 --> 02:06:41.026
FOR THE NEXT TEN YEARS AND

02:06:41.093 --> 02:06:42.161
WE'LL JUST KEEP GOING. AND

02:06:42.227 --> 02:06:43.128
UNFORTUNATELY, THAT'S FINE IF

02:06:43.195 --> 02:06:44.997
YOU'RE DOING IT AT A SUFFICIENT

02:06:45.064 --> 02:06:46.131
PACE WHERE YOU'RE GOING TO KEEP

02:06:46.198 --> 02:06:48.000
UP. BUT IF YOU'RE NOT LOOKING

02:06:48.067 --> 02:06:49.168
AT THE ENTIRE LIFE CYCLE, YOU

02:06:49.234 --> 02:06:50.269
MIGHT BE FALLING SHORT AND

02:06:50.336 --> 02:06:51.236
YOU'RE JUST, YOU KNOW,

02:06:51.303 --> 02:06:52.237
PROVERBIALLY KICKING THE CAN

02:06:52.304 --> 02:06:54.106
DOWN THE ROAD. AND MISS COMPTON,

02:06:54.173 --> 02:06:55.174
YOU SPOKE ABOUT THE PLANNING

02:06:55.240 --> 02:06:56.942
THAT YOU'RE DOING AT THE WATER

02:06:57.009 --> 02:06:57.943
AGENCY TO ANTICIPATE THOSE

02:06:58.010 --> 02:06:59.178
THINGS AND TO TRY AND, AND BE

02:06:59.244 --> 02:07:01.113
AHEAD OF THAT. AND DO YOU FEEL

02:07:01.180 --> 02:07:02.948
CONFIDENT THAT YOU ARE NOW NOT

02:07:03.015 --> 02:07:04.183
IN A PLACE WHERE THERE'S GOING

02:07:04.249 --> 02:07:06.185
TO BE UNANTICIPATED MAJOR

02:07:06.251 --> 02:07:07.619
INCREASES, OR IS IT JUST IT'S

02:07:07.686 --> 02:07:09.021
ALL GOING TO BE UNANTICIPATED?

02:07:09.088 --> 02:07:11.190
NO, WE'VE ACTUALLY BEEN DOING

02:07:11.256 --> 02:07:12.691
THIS SORT OF REPLACEMENT

02:07:12.758 --> 02:07:13.826
PLANNING FOR DECADES. WE'VE

02:07:13.892 --> 02:07:16.261
BEEN DOING IT, I THINK, EVEN

02:07:16.328 --> 02:07:19.131
BEFORE THE 90S. SO WE, IN EACH

02:07:19.198 --> 02:07:20.799
ONE OF OUR BILLS TO OUR

02:07:20.866 --> 02:07:21.800
CUSTOMERS, HAVE A SMALL

02:07:21.867 --> 02:07:23.469
PERCENTAGE THAT GOES BASED ON

02:07:23.535 --> 02:07:25.104
THEIR USE OF THE USEFUL, YOU

02:07:25.170 --> 02:07:26.372
KNOW, LIFE OF THE

02:07:26.438 --> 02:07:28.507
INFRASTRUCTURE TO BE PUT ASIDE

02:07:28.574 --> 02:07:30.709
FOR THAT. AND SO OUR PLAN GOES

02:07:30.776 --> 02:07:32.444
OUT, YOU KNOW, 5000 YEARS

02:07:32.511 --> 02:07:34.113
LOOKING AT EACH PIECE. SO THAT

02:07:34.179 --> 02:07:36.081
IS BUILT IN THE IT'S THE

02:07:36.148 --> 02:07:37.850
UNEXPECTED THINGS, YOU KNOW,

02:07:37.916 --> 02:07:39.351
WEATHER, WHIPLASH. AND THEN

02:07:39.418 --> 02:07:40.986
WHEN YOU HAVE TO CHANGE A

02:07:41.053 --> 02:07:42.521
FACILITY SUBSTANTIALLY BEYOND

02:07:42.588 --> 02:07:44.423
THOSE ASSUMPTIONS. BUT WE, WE

02:07:44.490 --> 02:07:47.593
DO THAT. SO OUR TYPICAL RATE

02:07:47.659 --> 02:07:48.694
INCREASE OVER, SAY, THE LAST

02:07:48.761 --> 02:07:50.863
HANDFUL OF YEARS HAS BEEN ABOUT

02:07:50.929 --> 02:07:53.098
4%. THAT'S MUCH LOWER THAN SOME

02:07:53.165 --> 02:07:54.199
OF OUR NEIGHBORS. AND THAT'S

02:07:54.266 --> 02:07:55.367
NOT A CRITICISM. IT'S JUST

02:07:55.434 --> 02:07:57.102
BECAUSE WE'VE BEEN AHEAD OF THE

02:07:57.169 --> 02:07:59.104
CURVE IN THIS AREA THAN MANY

02:07:59.171 --> 02:08:01.373
OTHER PEOPLE. PUTTING ASIDE THE

02:08:01.440 --> 02:08:02.808
OTHER SIDE OF THAT IS THEN

02:08:02.875 --> 02:08:03.976
FOLKS ASK, WELL, WHY DO YOU

02:08:04.043 --> 02:08:05.978
HAVE SO MUCH MONEY TO PUT ASIDE

02:08:06.045 --> 02:08:07.379
FOR RESERVES? AND IT'S NOT

02:08:07.446 --> 02:08:08.914
RESERVES, IT'S REPLACEMENT. AND

02:08:08.981 --> 02:08:10.616
SO WE EXPLAINED THAT IN OUR

02:08:10.682 --> 02:08:12.451
CUSTOMERS UNDERSTAND THAT, BUT

02:08:12.518 --> 02:08:14.953
IT TAKES THAT SORT OF MONEY.

02:08:15.020 --> 02:08:16.789
AND WE WE PAIR THAT WITH DEBT

02:08:16.855 --> 02:08:18.557
WHERE IT MAKES SENSE. SO WE'RE

02:08:18.624 --> 02:08:21.126
PLANNING THAT OUT 5100 YEARS.

02:08:21.193 --> 02:08:22.461
SO MY UNDERSTANDING IT RIGHT

02:08:22.528 --> 02:08:25.064
THAT YOU WERE CHARGING MORE

02:08:25.130 --> 02:08:26.331
EARLIER BECAUSE YOU UNDERSTOOD

02:08:26.398 --> 02:08:28.300
THIS PROBLEM AND YOUR RATES

02:08:28.367 --> 02:08:30.469
WERE HIGHER SOONER, BUT AS A

02:08:30.536 --> 02:08:32.137
RESULT OF THAT, YOU DON'T HAVE

02:08:32.204 --> 02:08:34.773
THIS SPIKE. WHEN YOU LOOK

02:08:34.840 --> 02:08:35.874
HISTORICALLY AT OUR RATES

02:08:35.941 --> 02:08:36.942
COMPARED TO OTHERS, THEY'VE

02:08:37.009 --> 02:08:38.343
ALWAYS BEEN LOWER. AND PART OF

02:08:38.410 --> 02:08:39.978
THAT IS BECAUSE WE HAVE BUDGET

02:08:40.045 --> 02:08:41.280
BASED RATES. BUT YES, WE'VE

02:08:41.346 --> 02:08:43.382
BEEN CHARGING, YOU KNOW, A

02:08:43.449 --> 02:08:45.918
LITTLE BIT EVERY MONTH, AGAIN,

02:08:45.984 --> 02:08:47.319
CONSISTENT WITH THE PLAN BASED

02:08:47.386 --> 02:08:49.555
ON THAT USER'S USE OF THE

02:08:49.621 --> 02:08:50.622
INFRASTRUCTURE AND THEIR USEFUL

02:08:50.689 --> 02:08:54.593
LIFE OF IT. SO, YOU KNOW, IT'S

02:08:54.660 --> 02:08:55.894
I DON'T THINK IT'S REALLY FAIR

02:08:55.961 --> 02:08:57.162
TO SAY THAT LIKE OUR RATES WERE

02:08:57.229 --> 02:08:59.331
HIGHER BECAUSE OF IT. IT'S JUST

02:08:59.398 --> 02:09:01.033
WE LOOKED AT IT AS GOOD

02:09:01.100 --> 02:09:02.835
FINANCIAL STEWARDSHIP OF THE

02:09:02.901 --> 02:09:04.036
BILLIONS OF DOLLARS WORTH OF

02:09:04.103 --> 02:09:04.736
INFRASTRUCTURE WE'RE GOING TO

02:09:04.803 --> 02:09:06.271
HAVE TO REPLACE ONE DAY. I

02:09:06.338 --> 02:09:07.473
DIDN'T MEAN THAT IN A CRITICAL

02:09:07.539 --> 02:09:09.441
WAY. I JUST SORT OF WAS TRYING

02:09:09.508 --> 02:09:11.276
TO FIGURE OUT THE MAGIC MATH.

02:09:11.343 --> 02:09:12.478
THAT'S HOW CAN YOU BE LOW RATES

02:09:12.544 --> 02:09:14.279
AND ALSO DOING THESE MAJOR.

02:09:14.346 --> 02:09:15.447
IT'S A FIXED COSTS. AND SO WE,

02:09:15.514 --> 02:09:17.249
WE DEFINITELY DIVIDE OUR FIXED

02:09:17.316 --> 02:09:19.051
COSTS VERSUS OUR VARIABLE. AND

02:09:19.118 --> 02:09:21.987
IT MEETS BOTH THE FINANCIAL

02:09:22.054 --> 02:09:22.688
ITEMS THAT WE'RE TALKING ABOUT

02:09:22.754 --> 02:09:24.089
IN TERMS OF INFRASTRUCTURE

02:09:24.156 --> 02:09:25.557
REPLACEMENT AND RUNNING THE

02:09:25.624 --> 02:09:26.992
SYSTEM, BUT ALSO OUR

02:09:27.059 --> 02:09:28.360
CONSERVATION GOALS, WHICH ARE

02:09:28.427 --> 02:09:29.928
USE WATER EFFICIENTLY. WELL,

02:09:29.995 --> 02:09:31.263
THANK YOU BOTH FOR THOSE

02:09:31.330 --> 02:09:33.799
ANSWERS. IT'S A SOBERING

02:09:33.866 --> 02:09:36.702
HEARING. SO JUST TO DOVETAIL A

02:09:36.768 --> 02:09:40.005
LITTLE BIT. WHEN YOU GATHER

02:09:40.072 --> 02:09:42.207
MONEY UP FRONT, ARE YOU GETTING

02:09:42.274 --> 02:09:43.842
A RATE OF RETURN ON IT AS IT

02:09:43.909 --> 02:09:45.511
SITS THERE? AND I NOTICED THAT

02:09:45.577 --> 02:09:46.645
YOU MENTIONED THE SORIA BILL,

02:09:46.712 --> 02:09:49.648
WHICH WAS A TRUST FUND CONCEPT.

02:09:49.715 --> 02:09:51.917
SO TELL ME A LITTLE BIT ABOUT

02:09:51.984 --> 02:09:53.785
WHAT YOU DO WITH THE MONEY ON

02:09:53.852 --> 02:09:55.687
THE FRONT END BEFORE YOU USE IT.

02:09:55.754 --> 02:09:56.755
YEAH. SO THE MONEY FOR

02:09:56.822 --> 02:09:58.323
REPLACEMENT, THAT PIECE OF IT

02:09:58.390 --> 02:10:00.826
WE'RE INVESTING IN, WE'VE BEEN

02:10:00.893 --> 02:10:02.961
OUT BEEN ABLE, QUITE FRANKLY,

02:10:03.028 --> 02:10:04.763
TO GET A VERY GOOD RETURN FOR

02:10:04.830 --> 02:10:06.899
OUR CUSTOMERS ON IT FOR A

02:10:06.965 --> 02:10:09.067
VARIETY OF REASONS. BUT WE'VE,

02:10:09.134 --> 02:10:10.302
WE'VE BEEN ABLE TO DO THAT. AND

02:10:10.369 --> 02:10:12.671
SO WE'RE USING BASICALLY WHAT

02:10:12.738 --> 02:10:14.540
WE'RE TO GROW THAT POT OVER

02:10:14.606 --> 02:10:16.608
TIME IN ADDITION TO THE MONTHLY

02:10:16.675 --> 02:10:17.843
CONTRIBUTIONS. SO IF YOU THINK

02:10:17.910 --> 02:10:19.745
OF IT A LITTLE BIT LIKE, YOU

02:10:19.811 --> 02:10:22.147
KNOW, YOUR 401 K OR YOUR 457,

02:10:22.214 --> 02:10:23.849
IT'S THAT SORT OF CONCEPT. BUT

02:10:23.916 --> 02:10:25.484
OBVIOUSLY WITHIN INVESTMENTS,

02:10:25.551 --> 02:10:27.085
THAT IS A LOCAL AGENCY WE'RE

02:10:27.152 --> 02:10:30.355
ALLOWED TO MAKE. AND SO WE'VE

02:10:30.422 --> 02:10:32.124
BEEN ABLE TO DO THAT QUITE

02:10:32.191 --> 02:10:33.192
SUCCESSFULLY FOR OUR CUSTOMERS.

02:10:33.258 --> 02:10:35.394
AND SO THAT HAS NOT ONLY HELPED

02:10:35.460 --> 02:10:37.596
KEEP RATES LOW, BUT ALSO PUT US

02:10:37.663 --> 02:10:39.698
IN A BETTER POSITION. SURE,

02:10:39.765 --> 02:10:40.766
SURE. MAKING YOUR MONEY WORK

02:10:40.832 --> 02:10:43.202
FOR YOU. YEAH. AND YOU, YOU DID

02:10:43.268 --> 02:10:44.803
TOUCH ON GROWTH IN HAVING A

02:10:44.870 --> 02:10:46.405
PLAN AS IT RELATED TO GROWTH IN

02:10:46.471 --> 02:10:47.639
THE AREA, ESPECIALLY ORANGE

02:10:47.706 --> 02:10:48.740
COUNTY. WE'RE SEEING A LOT OF

02:10:48.807 --> 02:10:52.277
GROWTH AND YOU HAVE TO ALLOCATE

02:10:52.344 --> 02:10:54.112
THE EXPENSE OF THAT GROWTH. SO

02:10:54.179 --> 02:10:56.915
I WAS JUST CURIOUS HOW YOU

02:10:56.982 --> 02:10:58.817
IRVINE, IS TAKING THAT ON. SO

02:10:58.884 --> 02:11:02.321
THE WAY WE ALLOCATE GROWTH, WE

02:11:02.387 --> 02:11:04.489
LOOK AT THE INFRASTRUCTURE

02:11:04.556 --> 02:11:06.391
NEEDS FOR NEW DEVELOPMENT, BOTH

02:11:06.458 --> 02:11:08.827
ON A REGIONAL BASIS, THOSE YOU

02:11:08.894 --> 02:11:10.395
KNOW, THE WATER TREATMENT PLANT

02:11:10.462 --> 02:11:12.464
THAT SERVES EVERYBODY VERSUS

02:11:12.531 --> 02:11:14.666
THE THE LOCALIZED AREA, BECAUSE

02:11:14.733 --> 02:11:16.435
THERE'S TWO TYPES OF THAT

02:11:16.501 --> 02:11:17.836
INFRASTRUCTURE ON THE REGIONAL

02:11:17.903 --> 02:11:20.806
BASIS. IT'S THEIR SHARE, LIKE

02:11:20.872 --> 02:11:22.140
WHAT THEIR DEMAND IS DRIVING

02:11:22.207 --> 02:11:25.377
FOR THAT. SO THERE'S NO

02:11:25.444 --> 02:11:26.511
CROSS-SUBSIDIZATION BETWEEN

02:11:26.578 --> 02:11:27.646
CUSTOMERS. EVERYBODY'S PAYING

02:11:27.713 --> 02:11:30.082
THEIR FAIR SHARE FOR THAT

02:11:30.148 --> 02:11:31.516
BECAUSE THAT PIECE OF THE

02:11:31.583 --> 02:11:32.985
INFRASTRUCTURE THAT THOSE NEW

02:11:33.051 --> 02:11:34.386
DEVELOPMENT IS USING, THEY

02:11:34.453 --> 02:11:36.922
SHOULD PAY FOR ON THE ON THE

02:11:36.989 --> 02:11:38.323
LOCALIZED AREA, WE'RE LOOKING,

02:11:38.390 --> 02:11:40.025
OKAY, WHAT ARE THE SIZE OF THE

02:11:40.092 --> 02:11:41.193
PIPES THAT YOU NEED AND THOSE

02:11:41.260 --> 02:11:42.995
SORTS OF THINGS. AND THAT GETS

02:11:43.061 --> 02:11:44.463
SPLIT BECAUSE IT'S A POLICY

02:11:44.529 --> 02:11:47.032
CALL MY BOARD HAS MADE ON

02:11:47.099 --> 02:11:48.934
INFRASTRUCTURE BETWEEN BECAUSE

02:11:49.001 --> 02:11:50.602
WE HAVE A SHARE OF PROPERTY

02:11:50.669 --> 02:11:52.738
TAXES, PROP HALF, 50% PROPERTY

02:11:52.804 --> 02:11:56.041
TAX AND 50% THAT DEVELOPMENT

02:11:56.108 --> 02:11:57.643
DURING IT. AND SO WE'RE ABLE TO

02:11:57.709 --> 02:11:58.910
MOVE THAT FORWARD IN A WAY THAT,

02:11:58.977 --> 02:12:01.013
AGAIN, TRIES TO SPREAD THE COST,

02:12:01.079 --> 02:12:04.650
BUT ABSOLUTELY ABIDING BY PROP

02:12:04.716 --> 02:12:06.418
26 AND 218 AND MAKING SURE

02:12:06.485 --> 02:12:08.253
THERE'S NOT CROSS-SUBSIDIZATION

02:12:08.320 --> 02:12:09.721
BETWEEN RATEPAYERS BECAUSE WE

02:12:09.788 --> 02:12:11.223
AREN'T ALLOWED TO DO THAT. AND

02:12:11.290 --> 02:12:12.491
SO THAT'S THE WAY WE'RE LOOKING

02:12:12.557 --> 02:12:14.293
AT IT GOING, THAT WE'VE LOOKED

02:12:14.359 --> 02:12:15.460
AT IT HISTORICALLY AND GOING

02:12:15.527 --> 02:12:16.495
FORWARD WHEN IT COMES TO

02:12:16.561 --> 02:12:17.429
REDEVELOPMENT, BECAUSE THAT'S

02:12:17.496 --> 02:12:20.098
SOMETHING THAT WE'RE SEEING IS

02:12:20.165 --> 02:12:21.233
REDEVELOPMENT THAT THEN HAS

02:12:21.300 --> 02:12:24.069
INTENSIFIED USES. WE LOOK AT IT

02:12:24.136 --> 02:12:26.238
ON, YOU KNOW, WHEN THAT

02:12:26.305 --> 02:12:28.440
PROPERTY WAS CONNECTED TO OUR

02:12:28.507 --> 02:12:30.275
SYSTEM. YOU KNOW, IT COULD BE,

02:12:30.342 --> 02:12:31.943
FOR EXAMPLE, A MANUFACTURING

02:12:32.010 --> 02:12:34.179
PLANT AND THEY PUT UP

02:12:34.246 --> 02:12:35.213
APARTMENTS, YOU KNOW, IF THE

02:12:35.280 --> 02:12:37.082
WATER USE OR SEWER USE AND

02:12:37.149 --> 02:12:38.383
DEMAND FOR INFRASTRUCTURE IS

02:12:38.450 --> 02:12:39.985
THE SAME, THERE'S NOTHING

02:12:40.052 --> 02:12:40.986
ADDITIONAL. OTHERWISE WE HAVE

02:12:41.053 --> 02:12:42.087
TO UPGRADE. AND THEN WE WORK

02:12:42.154 --> 02:12:43.989
WITH THAT DEVELOPER TO DO IT.

02:12:44.056 --> 02:12:45.123
SO AGAIN, WE'RE TRYING TO ABIDE

02:12:45.190 --> 02:12:46.358
BY THOSE COST OF SERVICE

02:12:46.425 --> 02:12:47.993
PRINCIPLES AND BE FAIR, BUT

02:12:48.060 --> 02:12:49.294
RECOGNIZING WE NEED MORE

02:12:49.361 --> 02:12:50.495
HOUSING UNITS. IN MY NECK OF

02:12:50.562 --> 02:12:52.097
THE WOODS THERE'S AFFORDABILITY.

02:12:52.164 --> 02:12:53.932
AND SO THOSE THINGS GO INTO IT.

02:12:53.999 --> 02:12:55.400
AND WE REALLY LOOK AT OURSELVES

02:12:55.467 --> 02:12:57.669
AS THE LAND USE ENTITIES DECIDE

02:12:57.736 --> 02:12:59.338
WHAT'S THERE, AND THEN WE'RE

02:12:59.404 --> 02:13:01.173
MAKING SURE THAT WE HAVE THE

02:13:01.239 --> 02:13:01.840
INFRASTRUCTURE AND THE

02:13:01.907 --> 02:13:04.743
UTILITIES TO SERVE THEM. SOUNDS

02:13:04.810 --> 02:13:05.844
REASONABLE. OKAY. WELL, THANK

02:13:05.911 --> 02:13:07.279
YOU SO MUCH. AND WITH THAT,

02:13:07.346 --> 02:13:10.549
WE'LL GO ON TO OUR THIRD PANEL.

02:13:10.615 --> 02:13:12.050
AND IT SEEMS APPROPRIATE THAT

02:13:12.117 --> 02:13:13.752
AS WE'VE COVERED A LOT OF WHAT

02:13:13.819 --> 02:13:15.153
HAPPENS IN CALIFORNIA AND WHAT

02:13:15.220 --> 02:13:16.922
SORT OF OPTIONS ARE ON THE

02:13:16.988 --> 02:13:18.023
TABLE FOR CALIFORNIA, IT WOULD

02:13:18.090 --> 02:13:19.491
BE WORTHWHILE TO LOOK AT OTHER

02:13:19.558 --> 02:13:21.693
STATES. SO OUR THIRD PANEL

02:13:21.760 --> 02:13:24.196
BRINGS TO US FOLKS FROM OTHER

02:13:24.262 --> 02:13:25.530
STATES, AND WE'RE GOING TO

02:13:25.597 --> 02:13:26.732
START OFF WITH WITH THE GREAT

02:13:26.798 --> 02:13:29.568
STATE OF TEXAS. AND WE HAVE

02:13:29.634 --> 02:13:33.572
SENATOR PERRY HERE, WHO THE

02:13:33.638 --> 02:13:35.741
TEXAS HAS GRAPPLED WITH WATER

02:13:35.807 --> 02:13:36.942
AND AND CREATED A WATER FUND.

02:13:37.008 --> 02:13:39.277
SO I, I LOOK FORWARD TO HEARING

02:13:39.344 --> 02:13:40.946
ABOUT WHAT TEXAS HAS DONE. AND

02:13:41.012 --> 02:13:42.314
AFTER THAT, WE'LL FOLLOW ALONG

02:13:42.381 --> 02:13:44.383
WITH COLORADO AND WHAT THEY'VE

02:13:44.449 --> 02:13:47.552
DONE WITH RESPECT TO FINANCING

02:13:47.619 --> 02:13:49.821
AND WATER INFRASTRUCTURE. SO,

02:13:49.888 --> 02:13:50.922
SENATOR PERRY, ARE YOU THERE?

02:13:50.989 --> 02:13:53.091
AND CAN YOU HEAR US? YES, MA'AM.

02:13:53.158 --> 02:13:54.993
I CAN HEAR YOU GUYS. HEAR ME?

02:13:55.060 --> 02:13:57.329
GOOD MORNING. GOOD MORNING.

02:13:57.396 --> 02:13:59.831
IT'S IT'S ABOUT 1:00 HERE. SO I

02:13:59.898 --> 02:14:01.700
FORGOT ABOUT THE TIME CHANGE.

02:14:01.767 --> 02:14:03.068
THAT SAID, I APPRECIATE THE

02:14:03.135 --> 02:14:04.169
OPPORTUNITY TO VISIT. YOU KNOW,

02:14:04.236 --> 02:14:07.005
WATER IS DEFINITELY NOT A

02:14:07.072 --> 02:14:08.140
PARSON. IT'S. EVERYBODY NEEDS

02:14:08.206 --> 02:14:10.575
IT. AND EVERYBODY. I COULD TAKE

02:14:10.642 --> 02:14:11.710
YOUR HEARING AND PUT IT IN

02:14:11.777 --> 02:14:13.812
TEXAS LEGISLATURE AS FAR AS HOW

02:14:13.879 --> 02:14:16.014
DO WE PAY FOR IT? SO

02:14:16.081 --> 02:14:17.215
SPECIFICALLY, TEXAS HAS A FIVE

02:14:17.282 --> 02:14:19.651
YEAR WATER PLANNING PROCESS. IT

02:14:19.718 --> 02:14:21.787
PLANS FOR 50 YEAR WATER SUPPLY

02:14:21.853 --> 02:14:23.989
NEED AND DEFICIT PLANNING IN

02:14:24.055 --> 02:14:25.257
THAT AND HOW WE REACH THAT. WE

02:14:25.323 --> 02:14:26.825
HAVE 16 REGIONAL PLANNING

02:14:26.892 --> 02:14:28.660
GROUPS THAT PUT THAT PLAN

02:14:28.727 --> 02:14:29.795
TOGETHER EVERY FIVE YEARS WITH

02:14:29.861 --> 02:14:30.929
THE OPPORTUNITY TO AMEND IT. SO

02:14:30.996 --> 02:14:32.731
OUR WATER PLAN LOOKS OUT 50

02:14:32.798 --> 02:14:35.500
YEARS, AND IN THAT MEANS WHAT

02:14:35.567 --> 02:14:37.235
WE'VE DONE IS WE HAD A PRETTY

02:14:37.302 --> 02:14:39.070
GOOD PLAN. I WOULD I WOULD

02:14:39.137 --> 02:14:41.206
CAUTION A PLAN WITHOUT FUNDING

02:14:41.273 --> 02:14:43.308
IS NO PLAN AT ALL. AND SECONDLY,

02:14:43.375 --> 02:14:45.944
WHAT I WOULD ALSO SAY, AS I

02:14:46.011 --> 02:14:47.412
BECAME CHAIRMAN OF WATER BACK

02:14:47.479 --> 02:14:50.182
IN 15, I TORE THE PLAN APART

02:14:50.248 --> 02:14:51.683
AND STARTED LOOKING THROUGH IT.

02:14:51.750 --> 02:14:54.252
AND THERE WAS SOME REALLY BIG

02:14:54.319 --> 02:14:55.420
GAPING HOLES OF THINGS THAT WE

02:14:55.487 --> 02:14:56.988
THOUGHT WOULD BE DOABLE AT THE

02:14:57.055 --> 02:14:58.223
TIME THEY WERE ENTERED INTO THE

02:14:58.290 --> 02:14:59.925
PLAN THAT WERE NO LONGER

02:14:59.991 --> 02:15:00.492
POLITICALLY AFFORDABILITY OR

02:15:00.559 --> 02:15:02.527
REGULATORY. SO PLANS NEED TO BE

02:15:02.594 --> 02:15:03.261
MONITORED AND THEY NEED TO BE

02:15:03.328 --> 02:15:05.330
AN HONEST ASSESSMENT. HOW WE

02:15:05.397 --> 02:15:07.165
GOT OVER THE FUNDING HURDLE. SO

02:15:07.232 --> 02:15:09.267
IT'S BEEN TRIED FOR ABOUT TEN,

02:15:09.334 --> 02:15:11.136
I'D SAY FIVE DECADES IN THE

02:15:11.203 --> 02:15:14.372
PAST. WE ARE A LARGE USER OF

02:15:14.439 --> 02:15:15.440
GROUNDWATER IN TEXAS. WE'RE A

02:15:15.507 --> 02:15:17.642
PRIVATE LANDOWNER STATE. SO A

02:15:17.709 --> 02:15:20.145
LOT OF TIMES THE PUSHBACK AND

02:15:20.212 --> 02:15:22.280
THE THE DEMISE OF THOSE FUNDING

02:15:22.347 --> 02:15:24.416
SOLUTIONS WERE GROUNDWATER

02:15:24.483 --> 02:15:26.284
RELATED IN THAT AREA, PRIVATE

02:15:26.351 --> 02:15:27.452
LANDOWNER RIGHTS. SO TAKING

02:15:27.519 --> 02:15:28.753
THAT AND THE KNOWLEDGE I HAD

02:15:28.820 --> 02:15:30.922
AND BEING A PRIVATE PROPERTY

02:15:30.989 --> 02:15:32.023
ADVOCATE, WE WERE ABLE TO

02:15:32.090 --> 02:15:33.391
THREAD THE NEEDLE TO GET A

02:15:33.458 --> 02:15:35.594
CONSISTENT SOURCE OF FUNDING

02:15:35.660 --> 02:15:36.695
GOING FORWARD. SO THESE ARE

02:15:36.761 --> 02:15:38.797
LONG TERM, DECADE OLD TYPE

02:15:38.864 --> 02:15:40.298
PROJECTS. THEY'RE EXPENSIVE.

02:15:40.365 --> 02:15:42.434
THEY NEED CONTINUITY OF FUNDING.

02:15:42.501 --> 02:15:43.602
VENDOR GROUPS ARE NOT EXCITED

02:15:43.668 --> 02:15:45.437
TO BE SUBJECT TO THE WILL OF

02:15:45.504 --> 02:15:46.571
THE LEGISLATURE EVERY TWO YEARS.

02:15:46.638 --> 02:15:47.639
AND THE POLITICS THAT ENSUE

02:15:47.706 --> 02:15:49.608
WITH THOSE LEGISLATORS. SO WE

02:15:49.674 --> 02:15:51.776
HAD DONE THIS SIMILAR IN A ROAD

02:15:51.843 --> 02:15:53.545
FUNDING PACKAGE BACK IN 13. SO

02:15:53.612 --> 02:15:57.649
WE SPECIFICALLY DEDICATED $1

02:15:57.716 --> 02:15:59.784
BILLION ABOVE A CERTAIN SALES

02:15:59.851 --> 02:16:01.920
TAX BASE GOING FORWARD FOR 20

02:16:01.987 --> 02:16:04.389
YEARS. SO IN 28, WE'LL SEE OUR

02:16:04.456 --> 02:16:06.625
FIRST INSTALLMENT OF 20 OF $1

02:16:06.691 --> 02:16:08.593
BILLION, $20 BILLION INVESTMENT

02:16:08.660 --> 02:16:11.229
OVER 20 YEARS, GIVING CERTAINTY

02:16:11.296 --> 02:16:12.430
TO THE VENDOR COMMUNITY THAT

02:16:12.497 --> 02:16:14.065
THERE WOULD BE FUNDING IN PLACE,

02:16:14.132 --> 02:16:16.101
REGARDLESS OF POLITICS, SUBJECT

02:16:16.167 --> 02:16:18.069
TO US OUR BUDGET MEETING, THOSE

02:16:18.136 --> 02:16:20.605
EXCESS FUNDS. SO WE DEDICATED,

02:16:20.672 --> 02:16:21.706
CONSTITUTIONALLY DEDICATED.

02:16:21.773 --> 02:16:23.441
THAT WAS THE KEY BECAUSE YOU

02:16:23.508 --> 02:16:24.643
DON'T WANT TO BE SUBJECT TO

02:16:24.709 --> 02:16:25.644
STATE APPROPRIATIONS AND

02:16:25.710 --> 02:16:26.745
PROBLEMS THAT COME WITH THAT.

02:16:26.811 --> 02:16:28.146
SO CONSTITUTIONALLY, WE

02:16:28.213 --> 02:16:29.614
DEDICATED VOTERS APPROVED 70

02:16:29.681 --> 02:16:33.184
PLUS PERCENT, $1 BILLION ABOVE

02:16:33.251 --> 02:16:34.986
A BASELINE OF SALES TAX. SO WE

02:16:35.053 --> 02:16:36.454
DIDN'T CREATE A NEW REVENUE

02:16:36.521 --> 02:16:38.290
NEED. WE TOOK EXISTING REVENUE.

02:16:38.356 --> 02:16:40.392
AND ANYTHING ABOVE THAT EXCESS

02:16:40.458 --> 02:16:42.494
BASELINE NOW TO $1 BILLION PER

02:16:42.561 --> 02:16:44.229
YEAR FOR 20 YEAR COMMITMENT. SO

02:16:44.296 --> 02:16:45.797
THAT'S HOW WE GOT TO A

02:16:45.864 --> 02:16:48.767
CONSISTENT SOURCE. IT WAS WHAT

02:16:48.833 --> 02:16:50.535
WAS NEEDED TO TO BE ABLE TO

02:16:50.602 --> 02:16:52.671
TACKLE THESE LONG TERM

02:16:52.737 --> 02:16:54.105
INFRASTRUCTURE NEEDS IN THE

02:16:54.172 --> 02:16:55.273
CERTAINTY OF FUNDING THAT COMES

02:16:55.340 --> 02:16:57.008
WITH THAT NEED. AND I THINK IT

02:16:57.075 --> 02:16:58.810
WAS A SWEET DEAL. I WILL SPEAK

02:16:58.877 --> 02:17:00.712
TO ONE OTHER PROGRAM WE PUT IN

02:17:00.779 --> 02:17:03.815
PLACE IN 13. WE FUNDED A SEED

02:17:03.882 --> 02:17:06.785
FUND OF $2 BILLION INITIAL SEED,

02:17:06.851 --> 02:17:09.187
AND IT'S GEARED MORE TOWARDS

02:17:09.254 --> 02:17:10.288
MULTI-MILLION DOLLAR, IF NOT

02:17:10.355 --> 02:17:11.423
BILLION DOLLAR PROJECTS FOR

02:17:11.489 --> 02:17:13.525
SOME OF OUR LARGER CITIES AND

02:17:13.592 --> 02:17:16.261
URBAN AREAS. AND WHAT IT HAS

02:17:16.328 --> 02:17:17.862
BEEN USED FOR IS TO DEVELOP

02:17:17.929 --> 02:17:19.965
ABOUT 11, $12 BILLION IN

02:17:20.031 --> 02:17:22.133
CAPITAL ASSET CAPEX ON WATER

02:17:22.200 --> 02:17:24.336
SUPPLY PROJECTS, SPECIFICALLY

02:17:24.402 --> 02:17:26.838
OVER THE LAST SINCE SINCE 13.

02:17:26.905 --> 02:17:29.140
AND WE'VE ONLY USED ABOUT $300

02:17:29.207 --> 02:17:31.576
MILLION OF THAT CORPUS, NET OF

02:17:31.643 --> 02:17:32.978
EARNINGS AND INS AND OUTS. AND

02:17:33.044 --> 02:17:35.113
WHAT THAT FUND IS DEFINED

02:17:35.180 --> 02:17:36.214
SPECIFICALLY TO DO IS

02:17:36.281 --> 02:17:38.416
EFFECTIVELY CREDIT LEVERAGE. SO

02:17:38.483 --> 02:17:40.185
LOCALS MIGHT HAVE A 4% BORROW

02:17:40.251 --> 02:17:41.553
RATE, STATE CAN BORROW THAT

02:17:41.620 --> 02:17:43.421
DOWN TO 1%. AND WE'VE USED THAT

02:17:43.488 --> 02:17:45.290
FUNDS IN VERY SUCCESSFULLY ON

02:17:45.357 --> 02:17:47.726
OUR RURAL AREA. I HAVE 41

02:17:47.792 --> 02:17:49.260
COUNTIES. I'VE HAD 51 FOR TEN

02:17:49.327 --> 02:17:50.629
YEARS BEFORE PRIOR

02:17:50.695 --> 02:17:52.330
REDISTRICTING, 38 OF THEM WERE

02:17:52.397 --> 02:17:54.132
UNDER 10,000 PEOPLE ON OUR

02:17:54.199 --> 02:17:56.334
RURAL. IT'S A DELIBERATE

02:17:56.401 --> 02:17:57.869
LEGISLATIVE PROCESS, WHICH WE

02:17:57.936 --> 02:17:59.771
ALWAYS ARE FOCUSED ON HELPING

02:17:59.838 --> 02:18:01.339
THE RURAL AND THE WATER SUPPLY

02:18:01.406 --> 02:18:03.208
NEEDS, BE IT LEAKY PIPES OR

02:18:03.274 --> 02:18:05.777
SUPPLY OR FLOODING, ETC. BUT IN

02:18:05.844 --> 02:18:07.445
THAT WHAT CAME OUT OF SENATE

02:18:07.512 --> 02:18:08.947
BILL SEVEN, WHICH IS THE

02:18:09.014 --> 02:18:10.048
DEDICATED FUNDING STREAMS WE

02:18:10.115 --> 02:18:13.618
PASSED LAST SESSION, WAS A

02:18:13.685 --> 02:18:15.086
CLEARLY AN OBVIOUS NEED TO DO

02:18:15.153 --> 02:18:17.956
HUB AND SPOKE. WE HAVE FOUND

02:18:18.023 --> 02:18:20.158
THAT THERE ARE REGIONAL

02:18:20.225 --> 02:18:21.593
REQUESTS WITH MULTIPLE CITIES

02:18:21.660 --> 02:18:23.528
NOT TALKING VERY WELL TO EACH

02:18:23.595 --> 02:18:25.363
OTHER. WHEN WE PUT THEM INTO

02:18:25.430 --> 02:18:26.531
THE PLAN, WE CAN LOOK AT A

02:18:26.598 --> 02:18:28.433
MASTER PLAN AND SAYS EVERY ONE

02:18:28.500 --> 02:18:30.402
OF THEM ARE LOOKING TO THE SAME

02:18:30.468 --> 02:18:31.403
SOURCE OF WATER. THEREFORE,

02:18:31.469 --> 02:18:33.438
THEY SHOULD BE CONNECTED

02:18:33.505 --> 02:18:34.506
REGIONALLY SO THAT THE

02:18:34.572 --> 02:18:35.874
TAXPAYERS CAN SHARE THE LOVE,

02:18:35.940 --> 02:18:38.143
IF YOU WILL, A LITTLE BIT LATER.

02:18:38.209 --> 02:18:39.411
YOU'VE GOT TO EAT THIS ELEPHANT

02:18:39.477 --> 02:18:41.312
ONE BITE AT A TIME. I APPLAUD

02:18:41.379 --> 02:18:42.414
THE WATER PERSON THAT JUST

02:18:42.480 --> 02:18:44.182
SPOKE ABOUT HAVING THE

02:18:44.249 --> 02:18:45.684
FORESIGHT TO PUT IN A

02:18:45.750 --> 02:18:48.553
REPLACEMENT VEHICLE. WE WE SET

02:18:48.620 --> 02:18:49.954
WATER RATES THROUGH THE PUBLIC

02:18:50.021 --> 02:18:51.790
UTILITIES COMMISSION IN TEXAS.

02:18:51.856 --> 02:18:53.224
THEY APPROVED THOSE RATES. AND

02:18:53.291 --> 02:18:54.693
I'VE ENCOURAGED LEGISLATION

02:18:54.759 --> 02:18:56.428
THAT WOULD GIVE AN OPTION OF A

02:18:56.494 --> 02:18:57.629
TWO RATE SYSTEM, IF YOU WILL.

02:18:57.696 --> 02:18:59.464
HERE'S YOUR BASE RATE. BUT IF

02:18:59.531 --> 02:19:01.166
YOUR TAXPAYERS ARE WILLING TO

02:19:01.232 --> 02:19:02.233
ABSORB THE SMALL PERCENTAGE, A

02:19:02.300 --> 02:19:04.402
POINT ABOVE IT FOR REPLACEMENT,

02:19:04.469 --> 02:19:06.604
BECAUSE WHAT WE FIND IS IF YOU

02:19:06.671 --> 02:19:07.872
DON'T DO THAT THROUGH INFLATION

02:19:07.939 --> 02:19:09.441
AND OTHER THINGS, THE ELEPHANT

02:19:09.507 --> 02:19:10.942
GETS TOO BIG TO EAT. AND THAT

02:19:11.009 --> 02:19:12.544
OLD ADAGE THE ELEPHANT ONE BITE

02:19:12.610 --> 02:19:13.812
AT A TIME IS DEFINITELY

02:19:13.878 --> 02:19:15.246
APPLICABLE IN INFRASTRUCTURE.

02:19:15.313 --> 02:19:16.681
YOU ARE FACING THE SAME

02:19:16.748 --> 02:19:17.782
PRESSURES THAT WE ARE

02:19:17.849 --> 02:19:19.117
NATIONWIDE. THERE IS A ROLE FOR

02:19:19.184 --> 02:19:20.985
FEDERAL COORDINATION ON WATER

02:19:21.052 --> 02:19:23.121
SUPPLY PLANNING, SPECIFICALLY

02:19:23.188 --> 02:19:25.256
COLORADO RIVER DESAL OUT OF THE

02:19:25.323 --> 02:19:26.291
PACIFIC. SO THOSE KIND OF

02:19:26.357 --> 02:19:28.259
THINGS. AND I THINK WE NEED, AS

02:19:28.326 --> 02:19:30.328
STATES GO, SET ASIDE ANYTHING

02:19:30.395 --> 02:19:32.097
BUT INFRASTRUCTURE. WE CAN BE

02:19:32.163 --> 02:19:34.265
VERY PARTIZAN IN OUR

02:19:34.332 --> 02:19:35.366
INITIATIVES OF COORDINATING A

02:19:35.433 --> 02:19:37.102
NATIONAL WATER PLAN. I'LL BE IN

02:19:37.168 --> 02:19:38.603
ISRAEL FOR THE FOURTH TIME IN

02:19:38.670 --> 02:19:40.739
DECEMBER, SPECIFICALLY TWICE

02:19:40.805 --> 02:19:42.674
FOR WATER INITIATIVES, AND THEY

02:19:42.741 --> 02:19:43.775
ALWAYS ARE LEADING THE PACK ON

02:19:43.842 --> 02:19:46.911
WHAT DESAL LOOKS LIKE IN TEXAS.

02:19:46.978 --> 02:19:48.713
WE'VE NOT OVER APPROPRIATED OUR

02:19:48.780 --> 02:19:49.447
RIVERS, BUT WE'RE CLOSE TO

02:19:49.514 --> 02:19:51.549
BEING FULLY APPROPRIATED. WE

02:19:51.616 --> 02:19:53.384
HAVE THREE OTHER NEW SUPPLY

02:19:53.451 --> 02:19:54.419
OPPORTUNITIES, SPECIFICALLY

02:19:54.486 --> 02:19:56.254
MARINE DIESEL, WHICH MAKES

02:19:56.321 --> 02:19:58.456
SENSE. AND WE HAVE PRODUCED

02:19:58.523 --> 02:19:59.991
WATER IN OUR OIL AND GAS SPACE

02:20:00.058 --> 02:20:01.659
THAT WE'RE COMING TO A PERMIT

02:20:01.726 --> 02:20:02.827
PROCESS TODAY. WE'RE GOING TO

02:20:02.894 --> 02:20:04.329
START TAKING ADVANTAGE OF THOSE.

02:20:04.395 --> 02:20:05.630
IT'S 26 MILLION BARRELS OF

02:20:05.697 --> 02:20:07.398
WATER PER DAY, COMES OUT OF THE

02:20:07.465 --> 02:20:08.800
GROUND IN THE PERMIAN BASIN.

02:20:08.867 --> 02:20:10.568
AND THEN LASTLY, AND THIS IS

02:20:10.635 --> 02:20:11.703
THE BACKFILL FOR OUR WATER

02:20:11.770 --> 02:20:13.972
SUPPLY NEEDS. WE HAVE ABOUT 5.2

02:20:14.038 --> 02:20:15.673
BILLION ESTIMATED BRACKISH

02:20:15.740 --> 02:20:18.543
AQUIFER SYSTEM THAT IS IN USE

02:20:18.610 --> 02:20:20.345
AND WILL CONTINUE TO BE A

02:20:20.411 --> 02:20:21.646
LARGER SHARE OF THAT. SO THE

02:20:21.713 --> 02:20:23.248
COST OF ALL THOSE PROJECTS ARE

02:20:23.314 --> 02:20:24.682
WAY BEYOND ANY INDIVIDUAL

02:20:24.749 --> 02:20:26.451
TAXING JURISDICTION TO GET

02:20:26.518 --> 02:20:27.986
STATE'S ROLE IS TO LEVERAGE ON

02:20:28.052 --> 02:20:30.488
THE FRONT END THE OPPORTUNITIES

02:20:30.555 --> 02:20:31.923
TO DO THESE DEVELOPMENTS,

02:20:31.990 --> 02:20:33.024
BECAUSE THERE'S NOT A MAYOR OR

02:20:33.091 --> 02:20:35.126
A CITY COUNCIL PERSON THAT CAN

02:20:35.193 --> 02:20:36.494
SELL THEIR LOCAL CONSTITUENCY.

02:20:36.561 --> 02:20:38.797
IN TODAY'S TIMES OF WE DON'T

02:20:38.863 --> 02:20:40.198
CARE ABOUT THE FUTURE, WE JUST

02:20:40.265 --> 02:20:41.366
WANT TO KNOW WHAT'S AT STAKE

02:20:41.432 --> 02:20:44.469
FOR US IS TO EFFECTIVELY

02:20:44.536 --> 02:20:45.603
LEVERAGE THE CONVERSATION. SO

02:20:45.670 --> 02:20:47.005
THE MAYOR'S NOT ASKING FOR OUR

02:20:47.071 --> 02:20:48.807
WATER SEWER RATE, 20 YEAR IN

02:20:48.873 --> 02:20:50.642
ADVANCE OF SUPPLY BEING

02:20:50.708 --> 02:20:52.010
DEVELOPED. SO THAT WAS KIND OF

02:20:52.076 --> 02:20:54.279
THE OVERALL PICTURE. I WILL SAY

02:20:54.345 --> 02:20:55.713
MY BIGGEST CHALLENGE WITH WATER

02:20:55.780 --> 02:20:57.448
IS IF YOUR TAPS RUN TODAY,

02:20:57.515 --> 02:20:59.284
CLEARLY WE HAVE NO PROBLEMS

02:20:59.350 --> 02:21:00.652
GETTING OVER. THAT HAS BEEN A

02:21:00.718 --> 02:21:02.086
CHALLENGE, BUT WE'VE GOT THE

02:21:02.153 --> 02:21:03.555
AWARENESS UP TO WHERE IT NEEDS

02:21:03.621 --> 02:21:05.723
TO BE. IF YOU TOOK A SHOWER

02:21:05.790 --> 02:21:07.559
TODAY, SOMEONE 30 YEARS AGO

02:21:07.625 --> 02:21:08.793
COMMITTED TO MAKING SURE YOU'D

02:21:08.860 --> 02:21:10.829
HAVE THE WATER TO DO IT. SO I

02:21:10.895 --> 02:21:12.130
WE'VE BEEN SUCCESSFUL IN

02:21:12.197 --> 02:21:13.631
RAISING THE LEVEL OF AWARENESS

02:21:13.698 --> 02:21:14.933
AND WATER SUPPLY DEVELOPMENT,

02:21:14.999 --> 02:21:17.202
BUT A CONSISTENT, PREDICTABLE

02:21:17.268 --> 02:21:19.037
FUNDING SOURCE FOR VENDOR

02:21:19.103 --> 02:21:20.839
COMMUNITIES TO RALLY AROUND AND

02:21:20.905 --> 02:21:23.374
PROJECTS TO BE LET AND STARTED

02:21:23.441 --> 02:21:24.876
WAS THE KEY AND THE HEART OF

02:21:24.943 --> 02:21:26.578
OUR STATE WATER PLANNING GOING

02:21:26.644 --> 02:21:29.214
FORWARD. WITH THAT, BE GLAD TO

02:21:29.280 --> 02:21:33.084
TAKE QUESTIONS. THANK YOU SO

02:21:33.151 --> 02:21:35.687
MUCH. I'D LIKE TO GET THROUGH

02:21:35.753 --> 02:21:36.754
THE OTHER SPEAKER ON THE PANEL

02:21:36.821 --> 02:21:38.590
AND THEN TAKE QUESTIONS. DO WE

02:21:38.656 --> 02:21:43.528
HAVE SPEAKER MCCLUSKEY HERE? I

02:21:43.595 --> 02:21:45.697
DON'T THINK SO. OKAY. DON'T GO

02:21:45.763 --> 02:21:47.498
AWAY THEN. SENATOR PERRY, WE'VE

02:21:47.565 --> 02:21:49.300
GOT SOME QUESTIONS FOR YOU FROM

02:21:49.367 --> 02:21:53.605
FROM FOLKS IN THE HEARING ROOM.

02:21:53.671 --> 02:21:56.107
MY I DO HAVE A QUESTION ABOUT

02:21:56.174 --> 02:22:01.546
THE URBAN SUPPLY PROJECTS AND

02:22:01.613 --> 02:22:04.515
YOUR WATER FUND. AND IS IT THAT

02:22:04.582 --> 02:22:06.451
YOU PUT 2 BILLION OF SEED MONEY

02:22:06.518 --> 02:22:08.353
IN THERE, AND THEN LOCALITIES

02:22:08.419 --> 02:22:10.855
ARE TAKING LOANS FROM THAT FUND

02:22:10.922 --> 02:22:13.691
AND, AND REPAYING IT. DO I HAVE

02:22:13.758 --> 02:22:14.926
THAT RIGHT? YEAH. SO AND I

02:22:14.993 --> 02:22:16.828
DON'T WANT TO CONFUSE IT. WE

02:22:16.895 --> 02:22:18.463
ACTUALLY HAVE A $20 BILLION

02:22:18.529 --> 02:22:19.697
DEDICATED FUNDING COMMITMENT

02:22:19.764 --> 02:22:22.033
THAT GOES INTO THE WATER

02:22:22.100 --> 02:22:23.835
DEVELOPMENT BOARD'S EXISTING

02:22:23.902 --> 02:22:26.337
PROGRAMS. AND THAT'S KIND OF A

02:22:26.404 --> 02:22:28.206
DIRECT EITHER BY GRANT OR LOW

02:22:28.273 --> 02:22:30.708
INTEREST LOANS, PHYSICAL. THE

02:22:30.775 --> 02:22:33.578
CASH IS PHYSICALLY GONE. WE HAD

02:22:33.645 --> 02:22:35.747
SET UP WHAT I CALL THE LEVERAGE

02:22:35.813 --> 02:22:37.215
FUND, THE CREDIT BOND FUND BACK

02:22:37.282 --> 02:22:40.018
IN 13, AND IT HAS PROVED TO BE

02:22:40.084 --> 02:22:42.921
IMMENSELY SUCCESSFUL, WHERE

02:22:42.987 --> 02:22:44.289
REGIONAL PLANNING SUPPLY

02:22:44.355 --> 02:22:45.390
COMPANIES, FOR INSTANCE,

02:22:45.456 --> 02:22:47.926
TARRANT COUNTY WATER, REGIONAL

02:22:47.992 --> 02:22:50.128
WATER SUPPLIES IS RESPONSIBLE

02:22:50.194 --> 02:22:52.297
FOR 40 COUNTIES OR WHATEVER

02:22:52.363 --> 02:22:53.731
WATER NEEDS THEY WERE ABLE TO

02:22:53.798 --> 02:22:56.301
GO TO THE MARKET AND BORROW

02:22:56.367 --> 02:22:59.137
MONEY. WITH A STATE LEVERAGED

02:22:59.203 --> 02:23:00.939
OUT OF THAT $2 BILLION SEED

02:23:01.005 --> 02:23:03.408
MONEY, THEY COULD BUY DOWN THE

02:23:03.474 --> 02:23:04.475
INTEREST RATE. AND I'LL GIVE

02:23:04.542 --> 02:23:05.944
YOU AN EXAMPLE, HARRIS COUNTY

02:23:06.010 --> 02:23:08.146
OR HOUSTON, TEXAS, IF YOU WILL,

02:23:08.212 --> 02:23:10.682
LARGEST RECIPIENT OF THOSE SEED

02:23:10.748 --> 02:23:12.050
MONIES FOR THE LEVERAGED BUY

02:23:12.116 --> 02:23:13.151
DOWN HAVE SAVED PROBABLY

02:23:13.217 --> 02:23:14.252
SEVERAL HUNDRED MILLION DOLLARS

02:23:14.319 --> 02:23:17.155
OF INTEREST COSTS. SO WE TOOK

02:23:17.221 --> 02:23:18.556
2,000,000,013, PUT IT TO WORK.

02:23:18.623 --> 02:23:19.991
WE'VE BEEN ABLE TO ROLL THAT

02:23:20.058 --> 02:23:22.360
INTO, I THINK, 11 OR $12

02:23:22.427 --> 02:23:24.696
BILLION OF PROJECTS, AND ONLY

02:23:24.762 --> 02:23:26.931
DILUTED IT BY ABOUT $300

02:23:26.998 --> 02:23:28.266
MILLION IN INTEREST BUY DOWN.

02:23:28.333 --> 02:23:29.701
SO THAT'S A CREDIT LEVERAGE.

02:23:29.767 --> 02:23:31.869
IT'S MADE FOR BIG DOLLAR, BIG

02:23:31.936 --> 02:23:34.405
DONORS, BIG, BIG URBAN INTEREST.

02:23:34.472 --> 02:23:35.473
THAT'S DIFFERENT THAN THE

02:23:35.540 --> 02:23:36.908
FUNDING PLAN WE JUST GOT

02:23:36.975 --> 02:23:38.343
DEDICATED. THAT WILL. BUT THE

02:23:38.409 --> 02:23:40.011
BULK OF IT WILL PROBABLY BE LOW

02:23:40.078 --> 02:23:41.946
INTEREST LOANS. AND FOR RURAL

02:23:42.013 --> 02:23:44.482
TEXAS GRANTS. SO TWO PROJECTS.

02:23:44.549 --> 02:23:46.317
BUT THAT I WILL TELL PEOPLE

02:23:46.384 --> 02:23:48.052
THAT SWIFT FUND THE WAY IT WAS

02:23:48.119 --> 02:23:49.754
SET UP, IF YOU ARE INTERESTED

02:23:49.821 --> 02:23:51.656
IN. IT, HAS BEEN A HUGE SUCCESS

02:23:51.723 --> 02:23:54.125
AND SAVED TAXPAYERS INTEREST

02:23:54.192 --> 02:23:56.361
COST WITH CREDIT LEVERAGE FROM

02:23:56.427 --> 02:23:57.562
STATE RESOURCE. AND THAT'S HOW

02:23:57.628 --> 02:24:00.298
YOU GET REGIONS, IF THAT MAKES

02:24:00.365 --> 02:24:01.799
SENSE. IT DOES. SO IT'S SORT OF

02:24:01.866 --> 02:24:03.434
THE GOOD FAITH AND CREDIT OF

02:24:03.501 --> 02:24:05.703
THE STATE OF TEXAS IS WHAT.

02:24:05.770 --> 02:24:10.074
ABSOLUTELY. AND WE PUT THAT

02:24:10.141 --> 02:24:11.843
$1,112 BILLION IS ONLY COST THE

02:24:11.909 --> 02:24:13.311
STATE ACTUALLY 300 MILLION OUT

02:24:13.378 --> 02:24:16.114
OF THAT. AND I'M LOOKING TO PUT

02:24:16.180 --> 02:24:17.982
$1 BILLION BACK INTO THAT

02:24:18.049 --> 02:24:20.084
PROGRAM TO RECAPITALIZE,

02:24:20.151 --> 02:24:22.286
ACTUALLY, PROBABLY GARNER

02:24:22.353 --> 02:24:23.855
ANOTHER, YOU KNOW, 8 TO $9

02:24:23.921 --> 02:24:25.723
BILLION OF PROJECTS OVER THE

02:24:25.790 --> 02:24:27.725
NEXT TEN YEARS OUT OF IT, I SEE.

02:24:27.792 --> 02:24:28.960
SO IT ALLOWS THE LOCALS TO GO

02:24:29.027 --> 02:24:31.262
GET MONEY CHEAPER. AND ONE MORE

02:24:31.329 --> 02:24:33.431
QUESTION JUST ON THE IT IS THAT

02:24:33.498 --> 02:24:35.900
YOU WERE ABLE TO SET ASIDE A

02:24:35.967 --> 02:24:38.102
PORTION OF AN EXISTING SALES

02:24:38.169 --> 02:24:39.604
TAX, AND THAT WAS AFTER A

02:24:39.670 --> 02:24:40.972
CERTAIN AMOUNT OF MONEY WAS

02:24:41.039 --> 02:24:42.073
COLLECTED ON THE TAX. THEN

02:24:42.140 --> 02:24:44.242
YOU'D GET THE OVERAGE. OR IS IT

02:24:44.308 --> 02:24:46.778
YOU'RE ALWAYS ENTITLED TO X

02:24:46.844 --> 02:24:48.212
PERCENTAGE OF SALES TAX

02:24:48.279 --> 02:24:50.748
COLLECTED. NO, NO. WE ONLY HAVE

02:24:50.815 --> 02:24:52.850
ONE TAX REVENUE IN TEXAS. SALES

02:24:52.917 --> 02:24:53.985
TAX. WE DON'T HAVE AN INCOME

02:24:54.052 --> 02:24:56.487
TAX. WE WE RELY ON COST

02:24:56.554 --> 02:24:57.588
RECOVERY THROUGH FEES. AND THEN

02:24:57.655 --> 02:24:59.690
WE HAVE SALES TAX. SO THAT

02:24:59.757 --> 02:25:01.526
SALES TAX BASE WE LOOKED AT THE

02:25:01.592 --> 02:25:02.927
HISTORY. WE LOOKED AT WHAT WE

02:25:02.994 --> 02:25:04.395
COULD ALMOST GUARANTEE WAS

02:25:04.462 --> 02:25:06.364
GOING TO BE IN THERE. AND I

02:25:06.431 --> 02:25:08.132
THINK IT ENDED UP BEING $46.5

02:25:08.199 --> 02:25:09.767
BILLION A YEAR IN SALES TAX.

02:25:09.834 --> 02:25:11.903
AND THAT HAD CONSISTENTLY BEEN

02:25:11.969 --> 02:25:14.105
BEEN BEEN PREDICTABLE. SO WE

02:25:14.172 --> 02:25:16.707
SET THAT ANYTHING ABOVE 46.5

02:25:16.774 --> 02:25:18.209
BILLION IN SALES TAX COLLECTION

02:25:18.276 --> 02:25:20.244
PER YEAR, THE FIRST BILLION IN

02:25:20.311 --> 02:25:22.380
SURPLUS GOES TO WATER

02:25:22.447 --> 02:25:23.448
INFRASTRUCTURE. AND IT'S

02:25:23.514 --> 02:25:24.515
CONSTITUTIONALLY DEDICATED. IT

02:25:24.582 --> 02:25:26.284
COMES OFF THE TOP. SO WE'LL GO

02:25:26.350 --> 02:25:27.718
INTO BUDGET IN JANUARY. WE'LL

02:25:27.785 --> 02:25:29.587
GET OUR ESTIMATE. ANYTHING

02:25:29.654 --> 02:25:31.756
ABOVE 46.5 BILLION IN THE FIRST

02:25:31.823 --> 02:25:33.524
BILLION GOES INTO THAT WATER

02:25:33.591 --> 02:25:36.494
SUPPLY PLANNING BUCKET. I'LL

02:25:36.561 --> 02:25:38.596
GIVE YOU AN EXAMPLE. THAT SAME

02:25:38.663 --> 02:25:40.798
PROGRAM WAS PUT IN PLACE IN

02:25:40.865 --> 02:25:42.200
2013, WHEN OUR SALES TAX

02:25:42.266 --> 02:25:45.069
COLLECTIONS WERE $27 BILLION A

02:25:45.136 --> 02:25:46.471
YEAR. THAT'S JUST BEEN THE

02:25:46.537 --> 02:25:48.673
GROWTH IN TEXAS. WE NOW ARE

02:25:48.739 --> 02:25:49.640
GETTING SOMEWHERE IN THE

02:25:49.707 --> 02:25:51.175
NEIGHBORHOOD OF 2.5 BILLION FOR

02:25:51.242 --> 02:25:53.644
ROADS AND CONSTRUCTION AND

02:25:53.711 --> 02:25:55.113
MAINTENANCE OF THOSE ROADS. SO

02:25:55.179 --> 02:25:58.015
OUR GROWTH HAS DOUBLED SINCE

02:25:58.082 --> 02:26:00.918
SINCE 2015. ON SALES TAX, IT

02:26:00.985 --> 02:26:03.855
CONTINUES TO DOUBLE OUR GROWTH

02:26:03.921 --> 02:26:05.623
CAPACITY. SO IT'S A BILLION IN

02:26:05.690 --> 02:26:08.092
THE BASE. THEREFORE, WE DIDN'T

02:26:08.159 --> 02:26:09.961
SACRIFICE EXISTING BUDGET AND

02:26:10.027 --> 02:26:11.362
SERVICES COMMITMENTS, BUT WE

02:26:11.429 --> 02:26:12.730
TOOK NEW GROWTH THAT WAS NOT

02:26:12.797 --> 02:26:14.532
PART OF THE BUDGET PROCESS AND

02:26:14.599 --> 02:26:17.068
DEDICATED IT TO SPECIFICALLY

02:26:17.135 --> 02:26:19.203
WATER. AND WHAT'S YOUR

02:26:19.270 --> 02:26:21.506
PERCENTAGE OF SALES TAX? SIX

02:26:21.572 --> 02:26:23.574
AND A QUARTER AND A QUARTER.

02:26:23.641 --> 02:26:25.343
OKAY. HASN'T BEEN CHANGED SINCE,

02:26:25.409 --> 02:26:27.912
GOSH, 1990. I MEAN, IT'S BEEN

02:26:27.979 --> 02:26:31.549
THAT WAY FOREVER. OKAY. SUCH IS

02:26:31.616 --> 02:26:33.050
THE GROWTH OF TEXAS. ALL RIGHT.

02:26:33.117 --> 02:26:34.685
WE'RE GOING TO MOVE ON TO OUR

02:26:34.752 --> 02:26:35.620
NEXT PANELIST, WHICH I

02:26:35.686 --> 02:26:37.622
UNDERSTAND HAS JOINED US NOW,

02:26:37.688 --> 02:26:39.023
SPEAKER MCCLUSKEY FROM THE

02:26:39.090 --> 02:26:41.993
STATE OF COLORADO. WELCOME.

02:26:42.059 --> 02:26:44.028
HELLO. THANK YOU. GREAT TO SEE

02:26:44.095 --> 02:26:47.698
YOU AGAIN. NICE TO SEE YOU AS

02:26:47.765 --> 02:26:49.100
WELL. ALL RIGHT. WELL, TELL US

02:26:49.167 --> 02:26:51.669
ABOUT THE CREATIVE WAYS THAT

02:26:51.736 --> 02:26:53.437
MIGHT INVOLVE GAMBLING AND AND

02:26:53.504 --> 02:26:57.074
WATER MONEY. YEAH. THE MARRIAGE

02:26:57.141 --> 02:26:59.577
OF TWO UNLIKELY BEDFELLOWS,

02:26:59.644 --> 02:27:03.481
RIGHT. IN THE STATE OF COLORADO.

02:27:03.548 --> 02:27:09.287
ALL OF OUR FUNDING FOR WATER

02:27:09.353 --> 02:27:11.822
PROJECTS IS REALLY FRAMED BY

02:27:11.889 --> 02:27:13.257
OUR WATER PLAN. AND THE

02:27:13.324 --> 02:27:15.760
COLORADO WATER PLAN, WHICH IS

02:27:15.826 --> 02:27:19.063
NOW IN ITS SECOND ITERATION, IS

02:27:19.130 --> 02:27:21.532
A GRASSROOTS EFFORT TO DEFINE

02:27:21.599 --> 02:27:43.854
BY EACH OF

02:27:43.921 --> 02:27:46.357
GENERAL FUND, CERTAINLY CASH

02:27:46.424 --> 02:27:48.192
FUNDS, CASH FUNDS FROM THE

02:27:48.259 --> 02:27:49.994
COLORADO WATER CONSERVATION

02:27:50.061 --> 02:27:52.063
BOARD, AND THEN, YOU KNOW,

02:27:52.129 --> 02:27:54.198
LIMITED GRANT FUNDING THAT WE

02:27:54.265 --> 02:27:57.468
WERE ABLE TO SECURE OVER OVER A

02:27:57.535 --> 02:28:00.338
PERIOD OF TIME. BUT IN 2019, WE

02:28:00.404 --> 02:28:02.773
REFER TO MEASURE TO THE VOTERS

02:28:02.840 --> 02:28:05.710
TAXING SPORTS BETTING AND

02:28:05.776 --> 02:28:08.179
ASSIGNING THAT REVENUE

02:28:08.246 --> 02:28:10.414
GENERATION TO ANY OF OUR WATER

02:28:10.481 --> 02:28:13.284
PLAN GRANTS, A WATER PLAN GRANT

02:28:13.351 --> 02:28:15.052
PROGRAM THAT IS CURRENTLY

02:28:15.119 --> 02:28:28.065
ADMINISTERED BY OU HAVE SEEN SPORTS

02:28:28.132 --> 02:28:30.534
BETTING EXPLODE IN POPULARITY.

02:28:30.601 --> 02:28:32.703
AND IN THE STATE OF COLORADO,

02:28:32.770 --> 02:28:34.939
WE. WE HAVE THE TAXPAYER BILL

02:28:35.006 --> 02:28:37.008
OF RIGHTS, WHICH GUIDES ANY OF

02:28:37.074 --> 02:28:40.244
OUR TAXATION IN THE STATE, AND

02:28:40.311 --> 02:28:43.914
BECAUSE WE HAD ONLY ASKED FOR

02:28:43.981 --> 02:28:45.683
$29 MILLION IN THAT ORIGINAL

02:28:45.750 --> 02:28:47.151
QUESTION, AND WE'RE FAR

02:28:47.218 --> 02:28:48.319
EXCEEDING THAT IN THE AMOUNT OF

02:28:48.386 --> 02:28:49.654
REVENUE THAT WAS BEING DRIVEN

02:28:49.720 --> 02:28:51.222
BY SPORTS BETTING. WE WENT BACK

02:28:51.289 --> 02:28:54.258
TO THE VOTERS A FEW YEARS AGO.

02:28:54.325 --> 02:28:57.962
THEY OVERWHELMINGLY SUPPORTED

02:28:58.029 --> 02:28:59.697
THE IDEA THAT EXTRA FUNDING

02:28:59.764 --> 02:29:01.098
COMING IN THROUGH THIS TAX

02:29:01.165 --> 02:29:02.566
SHOULD CONTINUE TO GO TO OUR

02:29:02.633 --> 02:29:05.469
WATER PROJECTS. SO WE ARE WE

02:29:05.536 --> 02:29:07.238
HAVE BEEN ABLE TO GROW THAT

02:29:07.305 --> 02:29:09.206
FUND AND CERTAINLY MAKE THE

02:29:09.273 --> 02:29:12.310
RIGHT KINDS OF INVESTMENTS.

02:29:12.376 --> 02:29:14.845
JUST THIS PAST FISCAL YEAR, WE

02:29:14.912 --> 02:29:19.150
AWARDED 580. SORRY, SINCE THE

02:29:19.216 --> 02:29:20.985
INCEPTION OF THE WATER PLAN

02:29:21.052 --> 02:29:24.255
GRANT THROUGH 2526, WE HAVE

02:29:24.322 --> 02:29:29.327
AWARDED 581 GRANTS AT OVER $139

02:29:29.393 --> 02:29:32.163
MILLION IN LOCAL PROJECTS. SO

02:29:32.229 --> 02:29:36.100
IT IS FOR COLORADO AND A MUCH

02:29:36.167 --> 02:29:38.969
SMALLER STATE THAN TEXAS. I WAS

02:29:39.036 --> 02:29:40.037
THOSE BILLIONS THAT WERE

02:29:40.104 --> 02:29:41.806
ROLLING OFF YOUR TONGUE. I

02:29:41.872 --> 02:29:43.207
DREAM OF HAVING THAT KIND OF

02:29:43.274 --> 02:29:45.976
MONEY IN OUR STATE, BUT GIVEN

02:29:46.043 --> 02:29:47.278
THE FUNDING THAT WE HAVE BEEN

02:29:47.345 --> 02:29:48.846
ABLE TO GENERATE, WE ARE, YOU

02:29:48.913 --> 02:29:50.848
KNOW, VERY PLEASED WITH THE

02:29:50.915 --> 02:29:51.882
INVESTMENTS WE'VE BEEN ABLE TO

02:29:51.949 --> 02:29:55.119
MAKE. AND WE GET A LOT OF VERY

02:29:55.186 --> 02:29:58.022
POSITIVE, STRONG FEEDBACK ABOUT

02:29:58.089 --> 02:30:00.191
THE ABILITY TO MAKE THESE

02:30:00.257 --> 02:30:02.360
INVESTMENTS IN WATER PROJECTS

02:30:02.426 --> 02:30:06.664
BIG AND SMALL. WELL, I GUESS

02:30:06.731 --> 02:30:08.466
YOUR STORY IS ONE OF NEVER

02:30:08.532 --> 02:30:10.301
UNDERESTIMATE THE ATTRACTION OF

02:30:10.368 --> 02:30:13.504
GAMBLING AND OR COLORADO, BUT

02:30:13.571 --> 02:30:15.506
I'M IMPRESSED BY YOU GOING BACK

02:30:15.573 --> 02:30:18.576
TO THE VOTERS TO GET MORE OF

02:30:18.642 --> 02:30:22.546
THAT SHARE OF REVENUE FOR WATER

02:30:22.613 --> 02:30:25.383
INFRASTRUCTURE PROJECTS. I'M

02:30:25.449 --> 02:30:28.619
ALWAYS AMAZED BY HOW THE PUBLIC

02:30:28.686 --> 02:30:30.821
IS. NEVER SEEMS TO DISAPPOINT

02:30:30.888 --> 02:30:32.223
IN BEING IN TUNE WITH THE

02:30:32.289 --> 02:30:35.793
IMPORT OF WATER PROJECTS. YEAH,

02:30:35.860 --> 02:30:38.396
I WOULD I WOULD EMPHASIZE THAT

02:30:38.462 --> 02:30:41.632
THAT HAS TAKEN THIS STATE. I AM

02:30:41.699 --> 02:30:44.835
SURE, MUCH LIKE CALIFORNIA, WE

02:30:44.902 --> 02:30:46.670
SAW THE CRISIS COMING. WE HAVE

02:30:46.737 --> 02:30:49.173
BEEN AWARE OF THE IMPACTS OF A

02:30:49.240 --> 02:30:50.207
SIGNIFICANT DROUGHT IN THIS

02:30:50.274 --> 02:30:53.110
STATE NOW FOR YEARS. AND OUR,

02:30:53.177 --> 02:30:55.312
YOU KNOW, CONSISTENT DRUMBEAT

02:30:55.379 --> 02:30:56.814
ABOUT THE IMPORTANCE OF WATER

02:30:56.881 --> 02:30:58.549
AS A NATURAL RESOURCE,

02:30:58.616 --> 02:31:00.985
PROTECTING BOTH QUANTITY AND

02:31:01.051 --> 02:31:04.288
QUALITY IS REALLY HAS REALLY

02:31:04.355 --> 02:31:06.757
HIT OUR COMMUNITY AND PRETTY

02:31:06.824 --> 02:31:08.359
POWERFUL AND IMPACTFUL WAYS.

02:31:08.426 --> 02:31:10.428
AND SO AT THE SAME TIME, WE

02:31:10.494 --> 02:31:13.998
WERE GOING TO VOTERS WITH THIS

02:31:14.064 --> 02:31:16.133
CREATIVE TAXATION APPROACH. WE

02:31:16.200 --> 02:31:18.702
WERE ALSO DEEPLY INVESTED IN A

02:31:18.769 --> 02:31:20.805
PR CAMPAIGN HELPING PEOPLE

02:31:20.871 --> 02:31:22.673
UNDERSTAND THE VALUE OF WATER

02:31:22.740 --> 02:31:25.176
AND WATER INFRASTRUCTURE, WATER

02:31:25.242 --> 02:31:26.644
PRESERVATION, THE, THE WORK

02:31:26.710 --> 02:31:28.479
THAT WAS GOING ON IN SO MANY OF

02:31:28.546 --> 02:31:29.847
OUR COMMUNITIES AND THE

02:31:29.914 --> 02:31:31.615
PROJECTS THAT SO DESPERATELY

02:31:31.682 --> 02:31:33.451
NEEDED FUNDING. AND I THINK THE,

02:31:33.517 --> 02:31:36.053
THE, THE ABILITY FOR US TO BE

02:31:36.120 --> 02:31:38.155
DOING BOTH OF THOSE THINGS IN

02:31:38.222 --> 02:31:39.190
PARALLEL IS REALLY WHAT HAS

02:31:39.256 --> 02:31:41.358
HELPED US SECURE THE ADDITIONAL

02:31:41.425 --> 02:31:44.628
FUNDING. EXCELLENT. THANK YOU,

02:31:44.695 --> 02:31:45.763
SPEAKER MCCLUSKEY. WE MIGHT

02:31:45.830 --> 02:31:47.965
HAVE A COUPLE QUESTIONS FROM

02:31:48.032 --> 02:31:49.233
SOME OF THE MEMBERS THAT ARE

02:31:49.300 --> 02:31:51.469
HERE. ASSEMBLY MEMBER ROGERS.

02:31:51.535 --> 02:31:52.603
YEAH, THANK YOU SO MUCH. AND

02:31:52.670 --> 02:31:54.438
THANK YOU BOTH FOR BEING HERE.

02:31:54.505 --> 02:31:55.539
MY QUESTION IS ACTUALLY JUST

02:31:55.606 --> 02:31:57.041
MORE OF AN INTEREST, BECAUSE I

02:31:57.107 --> 02:31:58.642
THINK ABOUT THIS A LOT WHEN WE

02:31:58.709 --> 02:32:00.244
TALK ABOUT WHAT THE SOLUTIONS

02:32:00.311 --> 02:32:01.946
HAVE BEEN IN TEXAS AND IN

02:32:02.012 --> 02:32:02.947
COLORADO AND SOME OTHER STATES

02:32:03.013 --> 02:32:06.217
AS WELL. SOME OF THAT ACTUALLY

02:32:06.283 --> 02:32:08.419
REQUIRES THE BUY IN FROM YOUR

02:32:08.486 --> 02:32:10.921
CONSTITUENCIES. AND IF YOU WERE

02:32:10.988 --> 02:32:11.922
TO GUESS FROM YOUR

02:32:11.989 --> 02:32:14.258
CONVERSATIONS WITH FOLKS, WHERE

02:32:14.325 --> 02:32:16.994
DO YOUR CONSTITUENTS THINK THE

02:32:17.061 --> 02:32:18.762
RESPONSIBILITY FOR FUNDING AND

02:32:18.829 --> 02:32:20.264
PLANNING AND IMPLEMENTING THESE

02:32:20.331 --> 02:32:21.699
PROJECTS COME FROM? LOCAL

02:32:21.765 --> 02:32:22.800
GOVERNMENT, STATE GOVERNMENT,

02:32:22.867 --> 02:32:24.268
FEDERAL GOVERNMENT? AND DOES

02:32:24.335 --> 02:32:26.370
THAT IMPACT THE SOLUTIONS THAT

02:32:26.437 --> 02:32:28.506
YOU THINK THEY ARE WILLING TO

02:32:28.572 --> 02:32:30.374
EMBRACE TO BE ABLE TO GET

02:32:30.441 --> 02:32:33.978
BETTER INFRASTRUCTURE? I'LL

02:32:34.044 --> 02:32:36.814
TAKE IT FIRST. I THINK THAT IF

02:32:36.881 --> 02:32:38.649
YOU'RE THINKING ABOUT IT AS A

02:32:38.716 --> 02:32:39.717
CONSTITUENT, WHICH IS THE FIRST

02:32:39.783 --> 02:32:41.886
HURDLE, LIKE I SAID AT THE TOP

02:32:41.952 --> 02:32:43.020
TODAY, THE AVERAGE PERSON ON

02:32:43.087 --> 02:32:45.422
THE STREETS IN TEXAS DOESN'T

02:32:45.489 --> 02:32:46.891
UNDERSTAND THAT WE NEED TO BE

02:32:46.957 --> 02:32:48.292
WORKING ON WATER FOR TOMORROW.

02:32:48.359 --> 02:32:50.561
SO SET ASIDE THAT I THINK THAT

02:32:50.628 --> 02:32:53.764
THE THE REALIZATION WHERE

02:32:53.831 --> 02:32:55.199
PEOPLE THAT DO UNDERSTAND WATER,

02:32:55.266 --> 02:32:57.334
THEY KNOW IT'S A TEAM APPROACH

02:32:57.401 --> 02:32:59.537
OFFENSIVE, TAKE STATE, LOCAL

02:32:59.603 --> 02:33:00.738
AND FEDERAL TO MEET THE WATER

02:33:00.804 --> 02:33:02.573
NEEDS, NOT ONLY IN TEXAS, BUT

02:33:02.640 --> 02:33:04.508
EVERYWHERE WE GO. WE HAVE TO

02:33:04.575 --> 02:33:06.677
FIGURE OUT HOW TO DO IT MORE

02:33:06.744 --> 02:33:08.879
AFFORDABLY. I HEARD SOME OF THE

02:33:08.946 --> 02:33:10.281
PERMITTING NUMBERS THAT

02:33:10.347 --> 02:33:11.382
CALIFORNIA IS FACING. WE'RE NOT

02:33:11.448 --> 02:33:13.517
THERE YET AS A PERCENTAGE OF

02:33:13.584 --> 02:33:15.019
PROJECTS, BUT WE'RE WE'RE WE'RE

02:33:15.085 --> 02:33:17.154
IN THE SOFT COST ARENA. THAT'S

02:33:17.221 --> 02:33:18.455
BEGINNING TO GET REAL DIFFICULT

02:33:18.522 --> 02:33:20.024
TO UNDERSTAND WHY IT TAKES THAT.

02:33:20.090 --> 02:33:21.825
BUT SET THAT ASIDE, I WOULD SAY

02:33:21.892 --> 02:33:23.594
THE AVERAGE PERSON DOESN'T HAVE

02:33:23.661 --> 02:33:25.329
THE APTITUDE TO THINK, WELL,

02:33:25.396 --> 02:33:26.530
THIS IS A LOCAL, FEDERAL OR

02:33:26.597 --> 02:33:28.332
STATE. THEY JUST KNOW THE NEED

02:33:28.399 --> 02:33:30.434
IS THERE. AND I THINK EVERYBODY,

02:33:30.501 --> 02:33:31.936
ESPECIALLY AT A COUNCIL AND A

02:33:32.002 --> 02:33:33.637
CITY COUNCIL LEVEL, RECOGNIZES

02:33:33.704 --> 02:33:35.472
THE NEED AND KNOW THEY CAN'T

02:33:35.539 --> 02:33:37.007
AFFORD IT ON THEIR TAX BASE.

02:33:37.074 --> 02:33:39.443
THERE'S NOT ANY ONE PARTICULAR

02:33:39.510 --> 02:33:40.878
TAXING JURISDICTION AT ANY

02:33:40.945 --> 02:33:43.447
LEVEL IN TEXAS THAT CAN SAY, WE

02:33:43.514 --> 02:33:44.848
CAN DO THIS ON OUR OWN. WE

02:33:44.915 --> 02:33:45.983
DON'T NEED HELP. SO THAT'S

02:33:46.050 --> 02:33:47.418
WHERE STATE LEVERAGE AND

02:33:47.484 --> 02:33:49.186
FEDERAL LEVERAGE MAKES IT

02:33:49.253 --> 02:33:50.588
POLITICALLY POSSIBLE AND

02:33:50.654 --> 02:33:51.855
ACTUALLY PRACTICALLY DOABLE. SO

02:33:51.922 --> 02:33:53.524
I DON'T KNOW THAT THE AVERAGE

02:33:53.591 --> 02:33:55.626
PERSON HAS AN OPINION OF WHOSE

02:33:55.693 --> 02:33:57.094
RESPONSIBILITY IT IS. I THINK

02:33:57.161 --> 02:33:58.362
IT'S EVERYBODY'S. AND THOSE

02:33:58.429 --> 02:34:00.397
THAT ARE IN TUNE TO WATER GET

02:34:00.464 --> 02:34:02.600
THAT. IT IS EVERYBODY'S

02:34:02.666 --> 02:34:04.001
RESPONSIBILITY, BOTH FROM

02:34:04.068 --> 02:34:05.069
CONSERVATION ALL THE WAY UP TO

02:34:05.135 --> 02:34:08.973
FUNDING AND. THAT WAS A VERY

02:34:09.039 --> 02:34:12.209
WISE RESPONSE. YOU KNOW, I, I,

02:34:12.276 --> 02:34:14.178
AS I MENTIONED, OUR PR CAMPAIGN,

02:34:14.244 --> 02:34:16.180
OUR EDUCATION CAMPAIGN, WATER

02:34:16.246 --> 02:34:17.948
EDUCATION COLORADO, AN

02:34:18.015 --> 02:34:19.083
ORGANIZATION THAT THE

02:34:19.149 --> 02:34:22.252
LEGISLATURE STOOD UP DECADES

02:34:22.319 --> 02:34:24.421
AGO TO ENSURE THAT THERE WAS A

02:34:24.488 --> 02:34:25.489
COMMITMENT TO BRINGING FOLKS

02:34:25.556 --> 02:34:27.324
ALONG AND UNDERSTANDING BOTH

02:34:27.391 --> 02:34:30.294
WATER NEED WATER STRUCTURE. AND

02:34:30.361 --> 02:34:32.429
I THINK THE, YOU KNOW, MY

02:34:32.496 --> 02:34:33.464
RESPONSE WOULD IMMEDIATELY BE

02:34:33.530 --> 02:34:37.001
ALL OF THE ABOVE. YOU KNOW, IN

02:34:37.067 --> 02:34:39.236
COLORADO, OUR OUTDOOR

02:34:39.303 --> 02:34:40.704
RECREATION, TOURISM ECONOMIES

02:34:40.771 --> 02:34:42.106
ARE DEEPLY DEPENDENT ON THE

02:34:42.172 --> 02:34:43.907
AMOUNT OF SNOW AND THE, YOU

02:34:43.974 --> 02:34:45.676
KNOW, THE AMOUNT OF CFS RUNNING

02:34:45.743 --> 02:34:48.212
IN OUR RIVERS DURING THE SUMMER.

02:34:48.278 --> 02:34:49.680
AND PEOPLE SEE THAT, RIGHT?

02:34:49.747 --> 02:34:52.149
IT'S VERY VISIBLE TO US. I HAD

02:34:52.216 --> 02:34:55.052
A OUR COLORADO WATER CONGRESS

02:34:55.119 --> 02:34:56.854
MET JUST A FEW MONTHS AGO, AND

02:34:56.920 --> 02:34:58.522
MANY OF OUR STATEWIDE OFFICIALS

02:34:58.589 --> 02:35:00.057
WERE DRIVING UP TO STEAMBOAT

02:35:00.124 --> 02:35:01.592
SPRINGS FOR THE MEETING. AND

02:35:01.659 --> 02:35:03.527
THEY PASSED SEVERAL RESERVOIRS

02:35:03.594 --> 02:35:05.429
THAT ARE BONE DRY, AND THERE

02:35:05.496 --> 02:35:08.399
WAS SHOCK AND AWE IN THE ROOM.

02:35:08.465 --> 02:35:10.567
AND IT DAWNED ON ME THAT, YOU

02:35:10.634 --> 02:35:11.669
KNOW, IN THIS STATE WHERE

02:35:11.735 --> 02:35:13.203
THINGS ARE SO CLEARLY VISIBLE

02:35:13.270 --> 02:35:16.640
TO SO MANY OF US, IT IS IT IS

02:35:16.707 --> 02:35:18.175
VERY IMPACTFUL AND CAN LEAVE

02:35:18.242 --> 02:35:21.345
YOU WITH A SENSE OF, YOU KNOW,

02:35:21.412 --> 02:35:23.447
BOTH DESPERATION AND NEED. AND

02:35:23.514 --> 02:35:24.581
I THINK WHEN PEOPLE START

02:35:24.648 --> 02:35:26.717
TALKING IN THEIR COMMUNITIES,

02:35:26.784 --> 02:35:28.852
AS WE HAVE BEEN DOING, WE'RE

02:35:28.919 --> 02:35:31.755
HOSTING STATEWIDE WATER

02:35:31.822 --> 02:35:33.157
CONVERSATIONS, AN EVENT THAT

02:35:33.223 --> 02:35:34.658
OCCURS EVERY SPRING HERE, THE

02:35:34.725 --> 02:35:36.527
STATE OF THE RIVER. IT'S A KIND

02:35:36.593 --> 02:35:39.329
OF A HOMEGROWN TOWN HALL FOR

02:35:39.396 --> 02:35:40.731
COMMUNITIES ACROSS THE WESTERN

02:35:40.798 --> 02:35:43.233
SLOPE. 15 DIFFERENT COUNTIES

02:35:43.300 --> 02:35:47.271
HOST THE THE THE COMMUNITY WIDE

02:35:47.337 --> 02:35:49.773
FREE, OPEN CONVERSATION WITH

02:35:49.840 --> 02:35:50.808
PEOPLE. AND I THINK WE'VE DONE

02:35:50.874 --> 02:35:52.576
A REALLY GOOD JOB OF INCLUDING

02:35:52.643 --> 02:35:54.111
FEDERAL, STATE AND LOCAL

02:35:54.178 --> 02:35:56.213
PARTNERS IN THOSE STATE OF THE

02:35:56.280 --> 02:35:58.015
RIVER MEETINGS, JUST TO HELP

02:35:58.082 --> 02:35:59.850
BUILD UNDERSTANDING. AND AGAIN,

02:35:59.917 --> 02:36:02.352
APPRECIATION FOR THE, THE

02:36:02.419 --> 02:36:04.621
COMPLEXITY OF, OF BOTH WATER

02:36:04.688 --> 02:36:06.356
LAW AND WATER NEED IN COLORADO.

02:36:06.423 --> 02:36:08.559
AND CERTAINLY THE CRISIS THAT

02:36:08.625 --> 02:36:10.627
WE ARE FACING NOW. YEAH. AND I

02:36:10.694 --> 02:36:12.830
HAVE 900,000 ACRE FEET

02:36:12.896 --> 02:36:13.931
DEPLETION IN THE OGALLALA

02:36:13.997 --> 02:36:15.699
AQUIFER FOR AGRICULTURE. I'M

02:36:15.766 --> 02:36:17.167
LIVING IN AGRICULTURAL

02:36:17.234 --> 02:36:18.569
COMMUNITY. SO, YOU KNOW, THAT'S

02:36:18.635 --> 02:36:20.037
ALWAYS BEEN A STEWARDSHIP

02:36:20.104 --> 02:36:21.004
CONVERSATION FOR THAT COMMUNITY.

02:36:21.071 --> 02:36:22.206
BUT I THINK AS CITIES ARE

02:36:22.272 --> 02:36:24.007
TAPPING INTO IT, THEY SEE THAT

02:36:24.074 --> 02:36:26.877
FOR WHAT IT IS. SO IT'S

02:36:26.944 --> 02:36:30.080
UNIVERSAL NEED. IT'S IT'S A LOW

02:36:30.147 --> 02:36:31.982
AWARENESS FACTOR OF, OF A FEW

02:36:32.049 --> 02:36:33.684
YEARS AGO. BUT I WILL TELL YOU

02:36:33.751 --> 02:36:35.552
THE AWARENESS FACTOR IN TEXAS

02:36:35.619 --> 02:36:36.587
BECAUSE OF SOME SIMILAR THINGS

02:36:36.653 --> 02:36:38.789
WE'VE DONE. WE HAVE TEXAS WATER

02:36:38.856 --> 02:36:39.790
FOUNDATION. THEY HAVE PUBLICLY

02:36:39.857 --> 02:36:43.093
PUT UP A PSA, IF YOU WILL, THAT

02:36:43.160 --> 02:36:44.895
HAS BEEN RUNNING AND PEOPLE ARE

02:36:44.962 --> 02:36:46.330
GETTING MORE AND MORE. WE HAD A

02:36:46.396 --> 02:36:47.898
SURVEY DONE JUST THIS PAST SIX

02:36:47.965 --> 02:36:52.469
MONTHS AGO, 73 OR PLUS PERCENT.

02:36:52.536 --> 02:36:54.938
TEXANS ARE INTERESTED IN WATER

02:36:55.005 --> 02:36:56.840
AND MAKING SURE WE HAVE THAT.

02:36:56.907 --> 02:36:58.509
SO IT'S IT'S AT A LEVEL IT'S

02:36:58.575 --> 02:37:00.644
NEVER BEEN THE DATA CENTER

02:37:00.711 --> 02:37:02.880
EXPLOSION IN TEXAS. ONE OF THE

02:37:02.946 --> 02:37:04.715
GOOD ATTRIBUTES AS PART OF THIS

02:37:04.782 --> 02:37:05.783
CONVERSATION HAS BEEN THEY'VE

02:37:05.849 --> 02:37:07.518
ROSE TO THE LEVEL OF

02:37:07.584 --> 02:37:09.653
CONVERSATION ABOUT WATER. AGAIN,

02:37:09.720 --> 02:37:11.855
IN ADDITION TO THE STUFF I DID

02:37:11.922 --> 02:37:14.057
TO GET THAT INITIATIVE OVER. SO

02:37:14.124 --> 02:37:15.592
PEOPLE ARE BEGINNING TO TALK

02:37:15.659 --> 02:37:17.227
AND THINK WATER LIKE THEY'VE

02:37:17.294 --> 02:37:22.633
NEVER HAD IN THE PAST. ALRIGHTY.

02:37:22.699 --> 02:37:25.135
THANK YOU SO MUCH FOR ASSEMBLY

02:37:25.202 --> 02:37:26.270
MEMBER HART. VERY QUICKLY, I

02:37:26.336 --> 02:37:27.938
JUST HAVE A REAL QUICK QUESTION

02:37:28.005 --> 02:37:29.439
FOR EITHER OF THE PANELISTS OR

02:37:29.506 --> 02:37:30.941
BOTH. OR IS THERE ANY KIND OF

02:37:31.008 --> 02:37:33.443
MAINTENANCE OF EFFORT

02:37:33.510 --> 02:37:34.444
REQUIREMENTS WHEN YOU ADDED

02:37:34.511 --> 02:37:35.979
THIS ADDITIONAL FUNDING TO YOUR

02:37:36.046 --> 02:37:38.448
SYSTEMS TO PRESERVE WHAT HAD

02:37:38.515 --> 02:37:39.750
HISTORICALLY BEEN IN THE SYSTEM,

02:37:39.817 --> 02:37:41.718
OR IS THIS NEW SUPPLEMENTAL

02:37:41.785 --> 02:37:45.722
FUNDING THAT THE ANSWER NOW, SO

02:37:45.789 --> 02:37:47.624
SPECIFICALLY TO THE NEW $20

02:37:47.691 --> 02:37:48.959
BILLION, 20 YEAR COMMITMENT, WE

02:37:49.026 --> 02:37:51.795
HAD EXISTING PROGRAMS. I DID

02:37:51.862 --> 02:37:54.331
DEDICATE 50% OF IT TO NEW

02:37:54.398 --> 02:37:56.266
SUPPLY, SPECIFICALLY BECAUSE IT

02:37:56.333 --> 02:37:58.202
HAS TO BE NEW SUPPLY AND NOT

02:37:58.268 --> 02:38:00.838
JUST SPEAKING LEAKY PIPES. WE

02:38:00.904 --> 02:38:03.507
LOSE ABOUT 4% OF OUR 17 MILLION

02:38:03.574 --> 02:38:05.843
ACRE FEET OF YEAR USE TO LEAKY

02:38:05.909 --> 02:38:08.078
PIPES. THAT IS KIND OF A LOCAL

02:38:08.145 --> 02:38:09.980
ISSUE. SO I DID SEPARATE. BUT

02:38:10.047 --> 02:38:10.981
TO YOUR QUESTION, SPECIFICALLY,

02:38:11.048 --> 02:38:12.683
THE LEGISLATION I BELIEVE

02:38:12.749 --> 02:38:16.320
CARVED OUT 2% ADDITIONAL

02:38:16.386 --> 02:38:17.221
ADMINISTRATION COSTS THAT THE

02:38:17.287 --> 02:38:18.222
WATER DEVELOPMENT BOARD CAN

02:38:18.288 --> 02:38:20.624
TAKE ADVANTAGE OF. AND REALLY

02:38:20.691 --> 02:38:22.826
WHAT THAT WAS TIED AROUND IS WE

02:38:22.893 --> 02:38:25.295
ANTICIPATE A LARGE VOLUME OF

02:38:25.362 --> 02:38:26.463
APPLICATIONS THAT HAVE NOT BEEN

02:38:26.530 --> 02:38:29.266
THERE BEFORE, AND IT JUST TAKES

02:38:29.333 --> 02:38:31.435
MORE PEOPLE TO PUSH THE

02:38:31.501 --> 02:38:32.870
APPLICATIONS THROUGH. AND WE

02:38:32.936 --> 02:38:34.538
DIDN'T WANT TO SEE $1 BILLION

02:38:34.605 --> 02:38:36.240
SITTING STAGNANT WITH A BACKLOG

02:38:36.306 --> 02:38:37.507
OF APPLICATIONS BECAUSE WE

02:38:37.574 --> 02:38:39.676
DIDN'T HAVE FTE. SO WE

02:38:39.743 --> 02:38:41.478
COMMITTED, I THINK, THE LAST 2

02:38:41.545 --> 02:38:44.381
OR 3 SESSIONS, I'VE ADDED 100

02:38:44.448 --> 02:38:46.149
FTE TO THE WATER DEVELOPMENT

02:38:46.216 --> 02:38:48.385
BOARD STAFFING THAT PROBABLY IN

02:38:48.452 --> 02:38:50.921
THE NEIGHBORHOOD OF $300

02:38:50.988 --> 02:38:52.656
MILLION OF SUPPORT THAT WENT

02:38:52.723 --> 02:38:54.491
WITH THAT. SO WE RECOGNIZED

02:38:54.558 --> 02:38:55.859
WE'RE FIXING TO FILL THE

02:38:55.926 --> 02:38:56.994
PIPELINE UP LIKE IT'S NEVER

02:38:57.060 --> 02:38:59.196
BEEN BEFORE. WE DIDN'T WANT THE

02:38:59.263 --> 02:39:00.297
TAXPAYERS TO BE WAITING IN LINE

02:39:00.364 --> 02:39:01.331
BECAUSE IT'S ALREADY LONG

02:39:01.398 --> 02:39:02.933
ENOUGH AND TIME IS MONEY AND

02:39:03.000 --> 02:39:04.501
WATER. SO YES, THERE WAS A

02:39:04.568 --> 02:39:06.069
MAINTENANCE OF EFFORT, BUT AS A

02:39:06.136 --> 02:39:08.038
BIG SCHEME OF THINGS, IT WAS, I

02:39:08.105 --> 02:39:10.641
THINK, LIMITED TO 2%. AND THEY

02:39:10.707 --> 02:39:12.409
HAVE MADE THAT WELL, WORK

02:39:12.476 --> 02:39:15.312
REALLY WELL. SO THAT'S KIND OF

02:39:15.379 --> 02:39:16.413
WHERE WE'RE WE'RE THE

02:39:16.480 --> 02:39:18.248
MAINTENANCE OF ONCE WE CHARGE

02:39:18.315 --> 02:39:19.750
THE LINE AND GOT THAT 20

02:39:19.816 --> 02:39:21.084
BILLION, THEY'LL HAVE THE

02:39:21.151 --> 02:39:23.720
BACKLOG FIXED WITH FTES NEEDED

02:39:23.787 --> 02:39:28.592
TO PUSH IT OUT. AND I, I WOULD

02:39:28.659 --> 02:39:31.528
OFFER, I MENTIONED WE HAD VERY

02:39:31.595 --> 02:39:32.763
LIMITED FUNDING TO IMPLEMENT

02:39:32.829 --> 02:39:34.631
THE COLORADO WATER PLAN AT THE

02:39:34.698 --> 02:39:37.668
TIME THAT IT WAS DEVELOPED. OUR

02:39:37.734 --> 02:39:39.836
SPORTS BETTING FUNDING IS THE

02:39:39.903 --> 02:39:41.238
DEDICATED FUNDING STREAM FOR

02:39:41.305 --> 02:39:43.740
MOST OF OUR WATER PLAN GRANT

02:39:43.807 --> 02:39:49.579
PROGRAM, AND IT IS NOT A. THANK

02:39:49.646 --> 02:39:51.348
GOD WE HAVE IT. ESPECIALLY IN

02:39:51.415 --> 02:39:53.216
THIS MOMENT. I WANTED TO THROW

02:39:53.283 --> 02:39:57.087
OUT THAT 87% OF COLORADANS NOW

02:39:57.154 --> 02:39:58.889
UNDERSTAND AND VIEW THE WATER

02:39:58.956 --> 02:40:01.792
CRISIS AS ONE OF THE MOST

02:40:01.858 --> 02:40:03.226
SIGNIFICANT PRIORITIES FACING

02:40:03.293 --> 02:40:06.396
OUR STATE, AND I. I ACTUALLY

02:40:06.463 --> 02:40:07.931
THOUGHT IT WAS THE EXACT SAME

02:40:07.998 --> 02:40:10.067
NUMBER. YOU HAD JUST THROWN OUT,

02:40:10.133 --> 02:40:12.569
70 SOME PERCENT OF TEXANS, I

02:40:12.636 --> 02:40:15.772
THINK, ARE PUBLIC IS CERTAINLY

02:40:15.839 --> 02:40:17.607
UNDERSTANDING HOW DIRE OUR

02:40:17.674 --> 02:40:22.346
SITUATION IS. THANK YOU BOTH

02:40:22.412 --> 02:40:25.515
FOR THE ANSWERS, AND THANK YOU

02:40:25.582 --> 02:40:27.684
FOR JOINING US. WE SO

02:40:27.751 --> 02:40:30.921
APPRECIATE HEARING DIFFERENT

02:40:30.988 --> 02:40:32.689
PERSPECTIVES AND AND DIFFERENT

02:40:32.756 --> 02:40:36.727
WAYS OF BEING CREATIVE WITH

02:40:36.793 --> 02:40:37.761
FINANCING WATER INFRASTRUCTURE.

02:40:37.828 --> 02:40:40.998
WITH THAT, I DO APPRECIATE IT.

02:40:41.064 --> 02:40:43.934
LET ME LEAVE YOU WITH THIS.

02:40:44.001 --> 02:40:45.369
WATER KNOWS NO STATE BOUNDARIES

02:40:45.435 --> 02:40:46.970
AND WE ALL NEED IT. I TELL

02:40:47.037 --> 02:40:48.238
PEOPLE WE NEED AIR AND WATER.

02:40:48.305 --> 02:40:50.007
EVERYTHING ELSE IS A QUALITY OF

02:40:50.073 --> 02:40:52.209
LIFE. I LIKE MY LIGHTS TO BE ON,

02:40:52.275 --> 02:40:54.678
BUT I'LL MAKE IT IF THEY DON'T.

02:40:54.745 --> 02:40:58.582
SO I WELCOME PARTNERSHIPS IN A

02:40:58.648 --> 02:41:00.083
FEDERAL COALITION THAT

02:41:00.150 --> 02:41:01.885
SOMETIMES LEGISLATURES ARE

02:41:01.952 --> 02:41:03.620
RELUCTANT TO HAVE. BUT THIS IS

02:41:03.687 --> 02:41:05.355
ONE OF THOSE THINGS THAT I

02:41:05.422 --> 02:41:07.290
THINK NATIONWIDE WE NEED TO BE

02:41:07.357 --> 02:41:08.825
ADDRESSING. AND WHETHER YOU

02:41:08.892 --> 02:41:10.193
LIKE THE ADMINISTRATION OR NOT,

02:41:10.260 --> 02:41:11.628
HE'S AN INFRASTRUCTURE AND

02:41:11.695 --> 02:41:13.363
BUILDER CONCEPT. AND I SAID, I

02:41:13.430 --> 02:41:15.432
WOULD LOVE TO SEE YOU TO BE THE

02:41:15.499 --> 02:41:16.500
EISENHOWER OF WATER. SO WE'RE

02:41:16.566 --> 02:41:17.667
WORKING ON SOME FEDERAL STUFF,

02:41:17.734 --> 02:41:19.503
BUT THEY DO NEED TO HEAR FROM

02:41:19.569 --> 02:41:20.971
THEIR STATE LEGISLATURE THAT

02:41:21.038 --> 02:41:22.406
THIS CAN BE SOMETHING THAT WE

02:41:22.472 --> 02:41:25.275
CAN UNITE ON A NATIONAL LEVEL

02:41:25.342 --> 02:41:27.077
AND ACTUALLY SOLVE BIG PROBLEMS.

02:41:27.144 --> 02:41:28.879
COLORADO RIVER SPECIFICALLY,

02:41:28.945 --> 02:41:31.381
AND ISRAEL'S BEEN FIGURED THIS

02:41:31.448 --> 02:41:33.050
OUT AND DONE IT. IF YOU'VE

02:41:33.116 --> 02:41:34.251
NEVER SEEN IT, YOU NEED TO GO

02:41:34.317 --> 02:41:36.186
SEE IT. BUT I'M JUST TELLING

02:41:36.253 --> 02:41:37.320
YOU, I WELCOME THE OPPORTUNITY

02:41:37.387 --> 02:41:38.288
TO VISIT WITH MY STATE

02:41:38.355 --> 02:41:39.322
COLLEAGUES AND PARTNERS ON

02:41:39.389 --> 02:41:41.691
WATER ISSUES. NOT NOT ANYTHING

02:41:41.758 --> 02:41:43.293
OTHER THAN IT'S A REQUIREMENT.

02:41:43.360 --> 02:41:45.495
WE START TALKING ABOUT THAT. WE

02:41:45.562 --> 02:41:47.597
CAN SOLVE IT. SO ANYTIME YOU

02:41:47.664 --> 02:41:49.733
NEED ME, FEEL FREE TO CALL ME.

02:41:49.800 --> 02:41:50.934
ALRIGHT. APPRECIATE YOU TAKING

02:41:51.001 --> 02:41:53.003
THE TIME AND, AND WE WELCOME

02:41:53.070 --> 02:41:54.838
COLLECTIVE DISCUSSIONS WITH THE

02:41:54.905 --> 02:41:57.340
BUREAU OF RECLAMATION. YOU'RE

02:41:57.407 --> 02:42:00.143
WELCOME. ANY TIME IN CALIFORNIA.

02:42:00.210 --> 02:42:03.113
ALL RIGHT. SO WITH THAT, WE

02:42:03.180 --> 02:42:04.514
THANK YOU SO MUCH, SPEAKER

02:42:04.581 --> 02:42:07.784
MCCLUSKEY, AND THANK YOU VERY

02:42:07.851 --> 02:42:12.823
MUCH. SENATOR PERRY. WITH THAT,

02:42:12.889 --> 02:42:16.426
WE WILL ALLOW PUBLIC COMMENT.

02:42:16.493 --> 02:42:18.061
WE HAVE SOME TIME CONSTRAINTS.

02:42:18.128 --> 02:42:19.629
SO IF THERE IS PUBLIC COMMENT,

02:42:19.696 --> 02:42:23.200
WE'D ASK THAT IT BE LIMITED TO

02:42:23.266 --> 02:42:26.103
ONE MINUTE. THAT WOULD BE 60S

02:42:26.169 --> 02:42:30.107
ANY PUBLIC COMMENT? IF THAT. IF

02:42:30.173 --> 02:42:32.976
NOT, THEN I KNOW CHAIR CARRILLO

02:42:33.043 --> 02:42:34.644
IS READY TO HIT THE GAVEL. SO

02:42:34.711 --> 02:42:35.846
BRING IT FORWARD AS FAST AS YOU

02:42:35.912 --> 02:42:37.981
CAN. GOOD MORNING, CHAIR AND

02:42:38.048 --> 02:42:39.149
MEMBERS. THANK YOU SO MUCH FOR

02:42:39.216 --> 02:42:40.917
THE DISCUSSION TODAY. I WILL BE

02:42:40.984 --> 02:42:42.686
BRIEF GIVEN THE TIME

02:42:42.752 --> 02:42:43.820
CONSTRAINTS, BUT DEFINITELY

02:42:43.887 --> 02:42:44.821
APPRECIATE THE CONVERSATION.

02:42:44.888 --> 02:42:47.023
THE CONVERSATION, EXCUSE ME,

02:42:47.090 --> 02:42:48.225
REALLY JUST WANT TO HIGHLIGHT

02:42:48.291 --> 02:42:50.260
THE POLICY OPPORTUNITY TO ALIGN

02:42:50.327 --> 02:42:51.661
CONSERVATION AFFORDABILITY AND

02:42:51.728 --> 02:42:53.797
THE FINANCIAL STABILITY. SO WE

02:42:53.864 --> 02:42:55.265
ENCOURAGE THE LEGISLATURE TO

02:42:55.332 --> 02:42:56.366
EXAMINE TOOLS THAT LET

02:42:56.433 --> 02:42:58.835
UTILITIES RECOVER REASONABLE

02:42:58.902 --> 02:43:00.337
COSTS WITHOUT DEPENDING ON

02:43:00.403 --> 02:43:02.205
CUSTOMERS USING MORE WATER.

02:43:02.272 --> 02:43:03.240
CUSTOMERS SHOULD BE ABLE TO

02:43:03.306 --> 02:43:04.641
CONSERVE AND MANAGE THEIR BILLS.

02:43:04.708 --> 02:43:06.109
WHILE UTILITIES RETAIN THE

02:43:06.176 --> 02:43:07.377
FINANCIAL CAPACITY TO PROVIDE

02:43:07.444 --> 02:43:09.312
SAFE, RELIABLE SERVICE RATE,

02:43:09.379 --> 02:43:10.747
DESIGN IS CENTRAL TO ACHIEVING

02:43:10.814 --> 02:43:13.216
BOTH OF THOSE, AND SO WE WILL

02:43:13.283 --> 02:43:14.284
DEFINITELY FOLLOW UP WITH THE

02:43:14.351 --> 02:43:15.519
COMMITTEE AND SHARE FURTHER

02:43:15.585 --> 02:43:19.089
DETAILS. THANK YOU. HI. GOOD

02:43:19.156 --> 02:43:20.157
MORNING, MICHAEL CHEN. ON

02:43:20.223 --> 02:43:21.958
BEHALF OF AUDUBON CALIFORNIA,

02:43:22.025 --> 02:43:23.059
WE WOULD FIRST LIKE TO SAY

02:43:23.126 --> 02:43:24.227
THANK YOU FOR HOSTING THIS

02:43:24.294 --> 02:43:25.328
JOINT HEARING. WATER QUALITY

02:43:25.395 --> 02:43:26.963
AND SUPPLY ARE CRITICAL FOR

02:43:27.030 --> 02:43:27.731
MAINTAINING MIGRATORY BIRD

02:43:27.797 --> 02:43:29.166
POPULATIONS ALONG THE PACIFIC

02:43:29.232 --> 02:43:30.400
FLYWAY, WITH THE CHALLENGES

02:43:30.467 --> 02:43:31.668
BEING PRESENTED TO CALIFORNIA

02:43:31.735 --> 02:43:32.802
WITH THE NEXT FEW SEASONS, IT

02:43:32.869 --> 02:43:34.337
IS CRUCIAL TO REALIZE THE

02:43:34.404 --> 02:43:35.605
IMPACTS OF WATER LOSS, WATER

02:43:35.672 --> 02:43:37.407
COSTS, AND SUPPLY ON OUR

02:43:37.474 --> 02:43:38.508
VULNERABLE REFUGES AROUND THE

02:43:38.575 --> 02:43:40.277
STATE. OVER THE PAST FEW

02:43:40.343 --> 02:43:41.211
DECADES, WETLANDS IN CALIFORNIA

02:43:41.278 --> 02:43:42.712
HAVE BEEN SHRINKING, AND IF

02:43:42.779 --> 02:43:43.947
THEY GO DRY, WE WILL NEVER GET

02:43:44.014 --> 02:43:45.682
THEM BACK. AS WE DISCUSSED

02:43:45.749 --> 02:43:46.683
SOLUTIONS AND ALTERNATIVE PATHS

02:43:46.750 --> 02:43:47.717
FOR FUNDING, WE WANT TO

02:43:47.784 --> 02:43:48.919
ENCOURAGE THE LEGISLATURE TO TO

02:43:48.985 --> 02:43:50.053
CONSIDER IMPACTS OF WATER

02:43:50.120 --> 02:43:51.555
SUPPLY ON WILDLIFE AND HABITAT,

02:43:51.621 --> 02:43:53.223
WHICH CAN SOMETIMES BE

02:43:53.290 --> 02:43:56.126
OVERLOOKED. THANK YOU SO MUCH.

02:43:56.193 --> 02:43:57.928
GOOD MORNING, CHAIR AND

02:43:57.994 --> 02:43:58.995
COMMITTEE MEMBERS, MELISSA

02:43:59.062 --> 02:44:00.463
SPARKS KRANZ WITH THE LEAGUE OF

02:44:00.530 --> 02:44:02.065
CALIFORNIA CITIES. AS YOU ARE

02:44:02.132 --> 02:44:03.500
WELL AWARE, CITIES WEAR MANY

02:44:03.567 --> 02:44:04.734
HATS, BUT IN THE WATER SECTOR,

02:44:04.801 --> 02:44:06.503
WE ARE ALSO LOCAL PUBLIC WATER

02:44:06.570 --> 02:44:07.704
AGENCIES. WE SERVE AS URBAN

02:44:07.771 --> 02:44:09.139
WATER SUPPLIERS, IMPLEMENTING

02:44:09.206 --> 02:44:10.540
CONSERVATION AND DRINKING WATER

02:44:10.607 --> 02:44:11.975
PROGRAMS, GROUNDWATER

02:44:12.042 --> 02:44:13.109
SUSTAINABILITY AGENCIES, AS

02:44:13.176 --> 02:44:14.477
WELL AS STORMWATER AND

02:44:14.544 --> 02:44:17.080
WASTEWATER TREATMENT OPERATORS.

02:44:17.147 --> 02:44:18.248
WE AGREE WITH THE CHALLENGES

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THAT THE PANELS HAVE PRESENTED

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THAT AGING INFRASTRUCTURE,

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REGULATORY REQUIREMENTS,

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TREATMENT COSTS AND THE

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EXTREMES BETWEEN DROUGHT AND

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FLOOD ARE REALLY PUTTING A

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STRAIN ON OUR WATER

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INFRASTRUCTURE NEEDS AND

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AFFORDABILITY. WE JUST WANTED

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TO ECHO SOME OF THE COMMENTS

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THAT THE PANELISTS MADE THAT

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OFTEN LOCAL AGENCIES, THE

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CAPABILITIES TO FINANCE WATER

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INFRASTRUCTURE NEEDS ARE BEYOND

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OUR CAPACITIES, WHICH IS WHY WE

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SUPPORT STATE, FEDERAL, LOCAL

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LEVERAGING OF FUNDS AND TO

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SUPPORT THOSE NEEDS. WE'VE BEEN

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SUPPORTIVE OF WATER BONDS IN

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THE PAST, GENERAL OBLIGATION

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BONDS, BUT WE ALSO NEED TO

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EXPLORE MORE SUSTAINABLE,

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CREATIVE, LONG TERM FUNDING

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SOLUTIONS. AS WAS MENTIONED, WE

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PREVIOUSLY HAVE SPONSORED

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LEGISLATION AIMED AT FUNDING

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SOLUTIONS SPECIFICALLY FOR

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MITIGATING PFAS, WHICH IS AN

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EMERGING AND COMPLEX AREA IN

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THE WATER AND WASTEWATER SPACE.

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AND SO WE'RE VERY VESTED IN

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THOSE TYPES OF SOLUTIONS

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BECAUSE THE TREATMENT

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TECHNOLOGIES ARE VERY DIFFERENT

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AND MORE COSTLY. AND LASTLY, AS

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WAS NOTED BY SOME OF THE

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PANELISTS, CAL CITIES AND THE

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CALIFORNIA STORMWATER QUALITY

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ASSOCIATION SUPPORT EFFORTS TO

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PROVIDE FUNDING FOR STORMWATER

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MANAGEMENT BASED ON THOSE PROP

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218 AND CONSTITUTIONAL

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CONSTRAINTS. STORMWATER

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PROGRAMS ARE BEING IMPLEMENTED

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BY MUNICIPALITIES, BUT WE LACK

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DEDICATED FUNDING SOURCES. SO

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IN THIS AREA, WE WANT TO BE

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HELPFUL PARTNERS TO EXPLORE

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EVERYTHING FROM CONSTITUTIONAL

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AMENDMENTS TO STORMWATER USER

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FEE MODELS TO PRIVATE PUBLIC

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PARTNERSHIPS. THANK YOU SO MUCH

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FOR HAVING THIS HEARING TODAY.

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IT'S REALLY IMPORTANT FOR OUR

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CITIES. THANK YOU. GOOD MORNING.

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JOSHUA KHÓ WITH THE SANTA CLARA

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VALLEY WATER DISTRICT. THANK

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YOU FOR HOSTING THIS HEARING

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TODAY. IT'S AN EXTREMELY

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IMPORTANT TOPIC. WE WOULD

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ENCOURAGE THE COMMITTEES TO

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CONSIDER A FUTURE INFORMATIONAL

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HEARING SPECIFICALLY FOCUSED ON

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THE DAM SAFETY AND CLIMATE

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RESILIENCE AND LOCAL ACTION

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PROGRAM. YOU HEARD FROM KARLA

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NEMETH EARLIER ABOUT OUR

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ANDERSON DAM SEISMIC RETROFIT

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PROJECT AND THE COSTS INVOLVED

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IN THAT PROJECT. WE HAVE THREE

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ADDITIONAL DAM SAFETY PROJECTS

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THAT WILL FOLLOW ANDERSON DAM.

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THIS IS AN ENORMOUS NEED FOR

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OUR WATER DISTRICT AND OTHERS

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THROUGHOUT THE STATE. THESE ARE

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NOT DISCRETIONARY PROJECTS THAT

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WE'RE UNDERTAKING. THESE ARE

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PUBLIC SAFETY CRITICAL PUBLIC

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SAFETY PROJECTS THAT MUST BE

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DONE. WE ARE THANKFUL THAT

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PROPOSITION FOUR ALLOCATED $480

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MILLION TO THESE PROJECTS, BUT

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WE HAVE TO BE CLEAR THAT THAT'S

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LESS THAN 2% OF THE NEED FOR

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THESE DAM SAFETY PROJECTS.

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THANK YOU. SEEING NO ONE ELSE

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COMING FORWARD WITH THAT, WE

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CONCLUDE THIS JOINT HEARING.

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THANK YOU, EVERYBODY, FOR BEING

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HERE