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The AWS Program is continuing to pursue the following two projects: PureWater Peninsula and South Bay Purified Water. Proposed addition: append the following paragraph to the AWS Program subsection. Cost exposure to Palo Alto and conditional position. PureWater Peninsula is currently budgeted at $747 million for 6 mgd of yield (SFPUC Water Enterprise FY 2027–2036 Ten-Year CIP, January 13, 2026, p. 94). Assuming a two-thirds BAWSCA cost share and Palo Alto's allocation share within BAWSCA of approximately 7%, Palo Alto's potential capital exposure is on the order of $35 million, plus operating costs. The City supports continued AWS planning, but conditions any cost-share commitment on the SFPUC and BAWSCA demonstrating a supply gap that persists under (i) Finance-Bureau-class demand projections (see Table 20 sensitivity, page 93) and (ii) a drought-of-record (1987–1992) planning methodology comparable to that used by Valley Water and EBMUD. The City notes that, since the February 2024 AWS Plan, three of six identified regional projects have been deferred and one has been canceled, indicating that the underlying supply-gap analysis remains unsettled. Editor's note — The current paragraph names the AWS projects but does not quantify what those projects could cost Palo Alto. Three of six projects deferred and one canceled within ~24 months is itself evidence that the supply-gap analysis is volatile. Recording Palo Alto's evaluative criteria in the UWMP — rather than only in correspondence — gives staff a principled basis on which to engage future BAWSCA cost-share votes. ────────────────────────────────────────────────────────────────────────────────────────── Edit 4 — Section 7, WSCP Financial Impacts (pp. 97 and 111) Subject: add a 2021–2023 Water Shortage Emergency lookback to the financial-impact discussion. Existing draft text — UWMP p. 97 (Palo Alto's Drought Experience): During the 2021 drought, City water use declined by 15% in response to SFPUC's system-wide voluntary water reduction measure. Existing draft text — UWMP pp. 111–112 (Revenue Reductions): As a retail provider, the City's fixed costs primarily relate to the cost of operating and maintaining the City's distribution system. Due to the City's volumetric rate structure, decline in sales revenue will exceed the decline in expenses. For each stage in the WSCP and assuming 2025 rate schedules, the revenue shortfall, net of the decline in expenses and based on FY 2025 costs and revenues, is calculated to be: Stage 1: Up to 10% target water savings results in $1.8 million shortfall Stage 2: 10% – 20% target water savings results in $3.5 million shortfall Stage 3: 20% – 30% target water savings results in $5.3 million shortfall Stage 4: 30% – 40% target water savings results in $7.0 million shortfall