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<br />g. ø~ /J-- <br /> <br />AB 1823 contains two key requirements: (1) the Hetch Hetchy system is operated to produce <br />water as a first priority, with electric power as a byproduct, and (2) following an earthquake or <br />other major disaster, the regional system should be operated to deliver water throughout the <br />service area, without regard to political boundaries, to the extent feasible. These provisions are <br />critically important for the existing 1.7 million people and businesses. A commitment to provide <br />these operational protections to the water customers in the region should continue even after <br />AB 1823 sunsets in 2010. <br /> <br />As the regional water system is rebuilt, capacity could be added to make the system more <br />reliable and provide water for planned growth that cannot be met through conservation, <br />recycling, desalination or other cost-effective solutions. <br /> <br />The capital improvement program is designed to rebuild the system, but its implementation may <br />not address the region's future needs. A cooperative working relationship exists with San <br />Francisco, but there is no written commitment that San Francisco will help meet future water <br />needs. An agreement should be pursued so BAWSCA agencies know what to expect for their <br />participation and investment. <br /> <br />4. Customers in the three counties must receive adequate water supplies during <br />droughts. <br /> <br />Since 1988, the service area population has increased over 15 percent. Water demands have <br />only now returned to pre-drought levels, largely due to conservation measures. Water supply <br />curtailments due to drought would have a greater impact today than during the drought of the <br />late 1980s and early 1990s. <br /> <br />Although SFPUC resolutions in 1988 and 2000 recognized the need to negotiate and execute <br />dry-year water contracts to lessen the impacts of drought, no additional supplies have as yet <br />been secured. <br /> <br />In fact, available supplies have decreased. Under an order from the State of California, San <br />Francisco reduced the operating storage of its largest Bay Area reservoir (Calaveras) to one- <br />third of its capacity. The state determined that the dam could collapse during an earthquake due <br />to irregularities during construction. <br /> <br />AB 1823 requires San Francisco to submit an a nnual report on progress made in acquiring <br />drought supplies. The initial report in February 2003 noted no new supplies had yet been <br />secured. In the event that San Francisco makes unsatisfactory progress, BAWSCA should <br />consider whether to acquire supplies for use during droughts and to negotiate agreements with <br />San Francisco to wheel the water to its agencies through the Hetch Hetchy system. AB 1823 <br />provides that existing water wheeling statutes apply to the San Francisco system. <br />