Status Report on Groundwater Management and Domestic Well Mitigation Issues. February 22, Washoe County Department of Water Resources

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1 Status Report on Groundwater Management and Domestic Well Mitigation Issues February 22, 2011 Washoe County Department of Water Resources

2 TABLE OF CONTENTS Section Page Introduction 3 1. Spanish Springs 3 2. Northeast Lemmon Valley Heppner Subdivision 4 3. Upper Mt. Rose-Galena Fan Areas of Southwest Reno 9 3. Domestic Wells and Well Mitigation in the Southwest Truckee Meadows a Concentration of domestic wells b Annual variability of precipitation including multi-year droughts c. Depth to Groundwater Well Mitigation Hearing Board Domestic Well Mitigation Proposals for Southwest Truckee Meadows Svc. Area Proposed Approach to Domestic Well Mitigation and Proposed Schedules of Fees and Charges for the Mt. Rose-Galena Fan Areas a. Domestic Well Conversions and Domestic Well Mitigation b. Domestic Well Mitigation Where Community Water Service Is Not Available c. New Development of Individual, Interspersed Undeveloped Parcels Washoe County Water and Sanitary Sewer Financial Assistance Program Proposed Program Funding 27 Conclusion 27 Appendices Appendix A Spanish Springs Groundwater Management Plan, November 2007; Appendix B Mt. Rose Groundwater Management Plan, February 2011; Appendix C Summary of Domestic Well Mitigation Determinations from November 2004 through December 2008; Appendix D Water and Financial Assistance Program Ordinance No. 1449; July 2010 Appendix E Water and Financial Assistance Program Policies and Procedures, July 2010 Appendix F Status Report on Activities of the Water and Financial Assistance Program through December 31,

3 INTRODUCTION Over the last two decades Washoe County s Department of Water Resources (DWR) has worked to address a range of groundwater management issues, especially those related to concerns raised by domestic well owners about the impacts of municipal pumping on groundwater levels and domestic well failures. Specific efforts in three basins, Spanish Springs, Northeast Lemmon Valley and the Galena-Mt. Rose Fan area of Southwest Reno have resulted in site specific approaches to addressing relevant issues. 1 The purpose of this report is to provide a comprehensive overview of the water systems and strategies that have been applied in each area of concern to address groundwater management issues. A variety of technical documents with more details is appended to this document to provide the reader with additional information and analyses. 1. Spanish Springs GROUNDWATER SYSTEMS AND ISSUES The Spanish Springs valley is a classic example of Nevada s basin and range formation, with the valley floor consisting of an alluvial aquifer surrounded by bedrock mountains. This bowllike configuration is illustrated in Figure 1 which shows a cross section of the North Spanish Springs area. Municipal wells have been located in the alluvial aquifer in the valley floor because water accumulates in the alluvial aquifer on the valley floor as a result of rainfall run-off and snow melt throughout the hydrographic basin. In contrast, many domestic wells in Spanish Springs have been located in fractured granite formations to the east and, as a result, tend to be of low productivity simply due to the shallow and poor water bearing nature of this material. Figure 1 Beginning as early as the 1980s, DWR staff had concerns about the over-appropriation of groundwater rights in Spanish Springs. The concerns were not driven by issues related to impacts of municipal pumping on domestic wells, in part because most of the development that had occurred or was planned for Spanish Springs was designed to be served by municipal rather 1 The Department of Water Resources program to recharge the Golden Valley aquifer to support the long term viability of some 600 domestic wells is not covered in this report. The Golden Valley Recharge Program is supported by fees paid by domestic well owners in Golden Valley and municipal pumping is not an influence driving the need for the recharge program. 3

4 than domestic wells. Rather the concerns were driven by concerns for the sustainability of municipal pumping in a basin in which groundwater rights were significantly over-appropriated. Following studies completed through the mid-1990s, DWR recommended changing the Washoe County s Development Code provisions related to the dedication of water for service in Spanish to require importation of Truckee River water into the County s Spanish Springs service area. To support this policy, DWR negotiated a wholesale water service agreement with Sierra Pacific (now TMWA) in 1996 and finalized a water facility plan identifying the infrastructure needed to deliver surface water into the area. The goal of these efforts was to provide surface water for use by further development in the Spanish Springs valley. Providing an alternate source of water would allow future municipal groundwater use to be limited to 1800 acre feet per year. This number is substantially less than the 3200 acre feet of water rights accumulated by DWR in support of development and groundwater management in the Spanish Springs basin and represents appropriate and responsible management by the County of the basin s limited groundwater resources. The $8.86 million in infrastructure improvements needed to fully implement the Spanish Springs groundwater management program were completed when DWR completed the last small piece of infrastructure, a water quality blending line for the Desert Springs Well in January A comprehensive status report and update of the Spanish Springs Groundwater Management Plan was developed by DWR and issued in November It is appended as Appendix A. 2. Northeast Lemmon Valley Heppner Subdivision Over the last decade and a half, DWR has also been heavily involved with water supply issues in Lemmon Valley where significant over-appropriation of groundwater rights permitted by the State Engineer dates back some 40 years and has resulted in a slow but continuous decline of the Lemmon Valley water table in some areas. One area of particular concern is the Heppner Subdivision of Northeast Lemmon Valley, where some 500 domestic wells have been concentrated in an area that is about one and half square miles. Northeast Lemmon Valley has the same bowl-like hydrogeology found in Spanish Springs. Figure 2 is a map that shows the locations of two cross-sections, A to A and B to B, in Northeast Lemmon Valley, and Figure 3 shows the hydrogeologic conditions at the two crosssections. The heavy concentration of domestic wells in the Heppner Subdivision, shown in the upper center of Figure 4, and on the left side of the cross-section A to A on Figure 3, represents 500 plus domestic wells on one acre parcels. The Heppner Subdivision rises from the Lemmon Valley floor on the south starting at an elevation of 4920 feet above sea-level and increases by 136 feet to an elevation of 5056 at the northern-most end of the subdivision. The underlying hydrogeology in this area quickly transitions from water bearing alluvia on the Lemmon Valley floor to the much more limited water bearing fractured granite formation at the northern extent of the Heppner Subdivision. As a result of these geophysical features, domestic wells located in the alluvial aquifer on the valley floor do not face the same domestic well challenges faced by residents of the Heppner 4

5 Figure 2 Location of Hydrogeologic Cross-Sections in Northeast Lemmon Valley 5

6 Figure 3 Two Hydrogeologic Cross-Sections in Northeast Lemmon Valley 6

7 Figure 4 Domestic Wells in Heppner Subdivision of Northeast Lemmon Valley Subdivision whose wells are located in fractured granite. When the Heppner subdivision was laid out in the 1950s it was intended to be served by a municipal water system. Concerns by the State Engineer in the late 1960s about Lemmon Valley s declining water table resulted in a study by the U.S. Geological Survey that was completed in the early 1970s. Based on this study, the State Engineer issued a moratorium on appropriating new groundwater rights to support development in the area. This decision meant that new local groundwater rights could not be obtained to support the installation of a municipal water system. Unfortunately, however, the moratorium did not prohibit Lemmon Valley property owners from developing properties served by domestic wells, which don t require appropriation of a water right from the State Engineer. Property owners in the Heppner Subdivision, with its high density of domestic wells constructed in unproductive fractured granite and in an area of low recharge have been dealing with the resulting declining water table and numerous failed domestic wells for many years. Many Lemmon Valley residents have raised concerns related to how municipal water use has or is influencing availability of groundwater in the Northeast Lemmon Valley Area. DWR has a 7

8 long history of providing municipal water service to customers in the Northeast Lemmon Valley, and its customer base has been quite stable over many years. Virtually all customers in this service area were initially charged a flat rate. As a result of transitioning many of the County s Northeast Lemmon Valley customers from the flat rate to the metered rate, DWR was able to reduce its municipal pumping by a bit more than 50% over the last 5 years. 2 Figure 5 documents trends in converting DWR s Northeast Lemmon Valley customers from the flat to metered rate and shows the corresponding 51% decline in annual water production from Northeast Lemmon Valley municipal wells from its high point in Figure 5 North Lemmon Valley Flat and Metered Customers and Water Use Trends Municipal Water System Reduced Pumping by 51.5% Since 2001 Number of Flat Rate Customers Metered Customers Annual AF Pumped Total Customers Number of Customers Year Staff has determined that the causes of domestic well failures in the Heppner Subdivision are the high concentration of domestic wells in a very small area and the unproductive nature of the fractured granite underlying this subdivision. Efforts to address the number of failing domestic wells in the Heppner Subdivision date back to the mid 1990s. Eventually DWR determined that the most reliable approach would be to install a community water system in the area to provide a high quality and adequate source of supply. The $5.9 million community water system project was funded with $3.4 million (58% of the total project cost) in federal and state grants. These 2 As per DWR s Water Rate Ordinance, flat rate customers are converted to the metered rate conversion if or when one of the following occurs: a property exceeds the use limit for flat rate customers of 65,000 gallons of water per month two times, the property changes ownership or there is a change of the property s tenant, or if the property owner requests the change. 8

9 grant funds helped DWR substantially reduce the cost of connecting Heppner area property owners to the community water system. In addition, over the last several years, DWR applied for and received federal Community Development Block Grant (CDBG) funds that covered 100% of both public right-of-way and onsite costs associated with connecting to the community water system for twenty-two (22) Heppner Subdivision residents eligible to receive CDBG funds. DWR has requested CDBG funds for an additional six (6) CDBG qualified Heppner residents for the 2011 calendar year. To date, the total CDBG funds requested and expended is $402,509. The cost of connecting to the community water system for Heppner residents includes both the general connection privilege fee of $4200, a $400 meter set fee and an allocated share of the line extension fee not covered by grant funding, currently $8, The line extension fee increases each July to reflect the weighted cost of capital (reflective of the time value of money) so those who connect later are covering the cost being incurred by DWR to finance the project. 3. Upper Mt. Rose-Galena Fan Areas of Southwest Reno DWR s recent groundwater management efforts have been focused on modifying groundwater management approaches to improve sustainability and analyzing domestic well mitigation for properties in Southwest Reno in the Mt. Rose-Galena fan areas. This area extends from ArrowCreek on the north to St. James on the south. Figure 6 is an aerial view of the Upper Mt. Rose-Galena Fan Areas of Southwest Reno and includes information about existing domestic wells and municipal water systems. Over 500 domestic wells are present in this area, with most being located south of the Mt. Rose Highway. The Galena Terrace Estates and Mountain Meadows subdivisions, often referred to as Callahan Ranch, are shown in the center of Figure 5, and include 227 domestic wells concentrated in a one-half square mile area. 3 DWR operates four inter-connected municipal water systems, St. James, Mt. Rose, ArrowCreek and South Truckee Meadows General Improvement District (STMGID) in this area. These water systems are comprised of 15 functional and 4 planned municipal wells that produce water from the same aquifer used by domestic wells in the area. The Nevada State Legislature of 2009 enacted Assembly Bill 54, Chapter 365, Statutes of Nevada, 2009, which was later added to Chapter 244 of the Nevada Revised Statutes as NRS and NRS respectively. Pursuant to NRS , Washoe County is required to develop a groundwater management plan for areas where it intends to offer financing for connections to Washoe County s municipal water or wastewater systems. As directed by provisions of NRS , the groundwater management plan must provide for the sustainable management of municipal groundwater supplies. 3 Between 2003 and 2007, DWR made a variety of improvements to the water facilities in the area, connecting dead end mains to provide better service and improve water quality, and installing a community water systems throughout the Galena Terrace Estates Subdivision. The implications of this system for area residents will be discussed in more detail later in this report. 9

10 Figure 6 Overview of Domestic Wells in the Southwest Truckee Meadows 10

11 DWR staff has used the NRS requirement for a groundwater management plan as an opportunity to pull together the bits and pieces of the existing management strategies and plans into a comprehensive, integrated approach to manage the critically important groundwater resources in the South Truckee Meadows region. The recently completed Mt. Rose Groundwater Management Plan, dated February 2011, is attached as Appendix B. A major element of this plan is the proposed capping of groundwater production for municipal use on the Upper Mt. Rose-Galena Fan at 5660 acre feet per year, with the current usage being 3660 acre feet per year. Any development occurring beyond the 5660 acre feet per year groundwater capacity would need to develop on alternative supplies. The groundwater aquifers in the Southwest Truckee Meadows are unlike the aquifers in Spanish Springs and in Lemmon Valley where the productive aquifers in are typically limited to the alluvial areas at the bottom of the valleys. The aquifer on the Galena-Mt. Rose fan is highly productive and is heavily influenced by snow pack accumulation in the much larger watershed in the high elevation areas above it. In addition, while Spanish Springs and Lemmon Valley have practically no discharge of water from these basins to local surface waters, in the South Truckee Meadows area groundwater flows underground down from the mountains west of the Galena-Mt. Rose fan areas and is ultimately discharged into the creeks and meadows on the valley floor. Figures 7 and 8 illustrate the geologic condition of the Mt. Rose-Galena fan area. Figure 7 identifies two areas that are shown in cross sections on Figure 8; these cross sections are identified as A to A and B to B, Both cross sections run from west to east across the Galena- Mt. Rose fan area. Figure 8 provides the cross sectional views of A to A and B to B. The A to A view on Figure 8 also shows the location of many of the municipal wells in the area serving ArrowCreek and STMGID customers, while B to B shows two of the municipal wells in the Mt. Rose water system and a couple domestic wells. The reliability and quantity of annual recharge to the aquifer in the Southwest Truckee Meadows groundwater area, combined with the geology, creates a substantially different condition with respect to aquifer productivity than that found in the more bowl-like aquifers north of the Truckee River. Unlike in the bowl-like aquifers to the north, water extractions from all sources can be expected to cause the Southwest Truckee Meadows aquifer to decline and re-equilibrate once pumping reaches a steady state. This dynamic is the result of the system being a flow through-like system and having much greater annual recharge than the existing or projected level of extraction, a situation which is the opposite of that in either Spanish Springs or Lemmon Valley where, in general, more groundwater is being withdrawn than is being replenished by annual recharge. The water producing characteristics of the Southwest Truckee Meadows aquifer certainly influenced the location and sizing of the several municipal wells that have been developed over time. Community concerns about the impacts of this development on domestic wells was a major impetus for convening the Regional Water Planning Commission s Groundwater Task Force in the early 2000s to consider the issues and develop recommendations to address the impacts of municipal pumping on domestic wells in the region. The Groundwater Task Force s work was conducted between March 2002 and June 2003 and several of the Task Force s recommendations have been implemented as part of DWR s efforts to address groundwater management issues in this area. 11

12 Figure 7 Location of Hydrological Cross-Sections on the Upper Mt. Rose-Galena Fan 12

13 Figure 8 Hydrogeologic Cross-Sections of Aquifers on the Upper Mt. Rose-Galena Fan 13

14 3.1 Domestic Wells and Well Mitigation in the Southwest Truckee Meadows DWR s groundwater management and domestic well mitigation programs are implemented within the framework of Nevada State Water Law (generally found in NRS 533 and 534). For example, NRS (b) indicates that it is the Policy of the State to recognize the importance of domestic wells as appurtenances to private homes, to create a protectable interest in such wells and to protect their supply of water from unreasonable adverse effects which are caused by municipal, quasi-municipal or industrial uses and which cannot reasonably be mitigated. (Emphasis added) Over time DWR staff and community interests have worked with representatives of the Nevada State Engineer s Office to develop local approaches to reasonably mitigating the impacts of municipal pumping on domestic wells. Regardless of what mechanisms are in place to address such issues locally, a domestic well owner always has the right to submit his or her case to the State Engineer s office for evaluation. State statute also addresses the issue of deepening domestic wells when a community water system is available. Pursuant to NRS (d), the State Engineer may prohibit the drilling of wells for domestic use, as defined in NRS , in areas where water can be furnished by an entity such as a water district or a municipality presently engaged in furnishing water to the inhabitants thereof. As noted earlier, Figure 4 shows the distribution of domestic wells in the Mt. Rose-Galena Fan areas. A variety of factors can influence the productivity of any well. In this section, staff describes the relationships and contributions of these various factors in domestic well failures in the Southwest Truckee Meadows area. 3.1.a Concentration of domestic wells: Earlier parts of this status report have presented information about how the concentration of domestic wells may influence groundwater resources. In effect, an area with a high concentration of domestic wells collectively behaves in the same manner as a production well, with an estimated demand of one gallon per minute for each domestic well. In the Galena Terrace Estates example, the impact of hundreds of domestic wells is estimated to have contributed at least 2 feet to the drawdown of the groundwater table. 3.1.b Annual variability of precipitation including multi-year droughts: Annual precipitation has a substantial influence on local groundwater levels. Figure 9 shows more than 30 years of annual precipitation in the Mt. Rose-Galena Fan area and tracks water levels and relates groundwater levels at the Timberline well to this precipitation showing a direct relationship between groundwater levels and local precipitation in this groundwater system. 3.1.c Depth to Groundwater: Another factor influencing the life and productivity of domestic wells is the original domestic well construction, specifically the quality of well construction, and the depth to groundwater. Figure 10 is an excerpt of the lower portion of Figure 8, and it shows the relationship between the depth to groundwater and the water table when the well was originally drilled. Clearly, as indicated by the natural variability of groundwater levels due to precipitation shown in Figure 9, domestic wells constructed with a 14

15 very shallow penetration of the groundwater table are substantially more vulnerable to any of the variables that may impact groundwater levels described here. Figure 9 Precipitation and Groundwater Levels in the Southwest Truckee Meadows 160% % Average Regional Precipitation 120% 100% 80% Depth to Water (Feet) Moving 5yr % of average % 165 Regional Precipitation Timberline Water Level 40% Jun-68 Jun-70 Jun-72 Jun-74 Jun-76 Jun-78 Jun-80 Jun-82 Jun-84 Jun-86 Date Jun-88 Jun-90 Jun-92 Jun-94 Jun-96 Jun-98 Jun-00 Jun-02 Jun-04 Jun Figure 10 Importance of Depth to Groundwater in Well Construction This well is more vulnerable to changing conditions than this one 15

16 Figure 11 shows groundwater usage in this area for the last 20 years and includes information on the number of well deepenings or connections to municipal systems that have occurred in this area for the same period. Figure 11 clearly shows that municipal water use in this area grew rapidly between 1995 and During this same period the number of municipal water connections using groundwater more than doubled. Figure 11 Domestic Well Failures and Municipal Pumping in the Mt. Rose-Galena Area 1990 to Domestic Wells Deepened or Connected Municipal Pumping 4000 Number of Domestic Wells Deepened or Connected Annual Municipal Pumping (af) Figure 12 provides a more detailed breakdown showing how many wells were deepened versus how many properties where connected to community water systems. Staff notes that the significant increase in wells deepened between 2003 and 2005 is probably associated with Callahan Ranch residents acting to deepen their wells in advance of having the community water system completed. Area residents were informed and understood that under the provisions of NRS (b) (discussed earlier), once the community water system was completed, property owners would no longer have the option of deepening their domestic well. 16

17 Figure 12 Domestic Well Failures on the Upper Mt. Rose-Galena Fan New Water System Connections Domestic Wells Deepened Well Mitigation Hearing Board As a result of ongoing concerns about the impacts of municipal pumping on domestic wells and on the sustainability of the groundwater resources, the Regional Water Planning Commission recommended the County create a Groundwater Task Force to work with the Regional Water Planning Commission to develop possible approaches to addressing issues of concern. The Groundwater Task Force was convened in March 2002 and submitted its recommendations to the Regional Water Planning Commission in June of Among these recommendations was the creation of a Well Mitigation Hearing Board (WMHB) to provide a mechanism for property owners to seek mitigation of the impacts of municipal pumping on their well by receiving reimbursement for the cost of well deepening or connecting to the municipal water system. The WMHB provided a forum for each resident to make their case for consideration to a panel of experts. The plan was that the WMHB s determinations would be advisory to the utility involved and that the ultimate decision of what mitigation would be offered to an individual property owner would be up to the utility. The Board of County Commissioners supported the 17

18 approach and directed DWR to implement it in August 2003 and DWR staff worked through the following year to implement this direction. In late summer 2004, members were appointed to the newly created WMHB and in March 2005, the WMHB heard the first four cases and made its first determinations. As the WMHB process was implemented, four key factors were used to estimate the amount of unreasonable drawdown from municipal well production that would be considered: Total well drawdown a measure established for each well based on well log records; Reasonable drawdown due to municipal pumping; Drawdown attributed to drought; and Drawdown attributed to other domestic wells. The idea was that by using these factors 4, several of which are obviously not objective measurements, an estimate could be used to deduce the amount of the unreasonable impacts to a domestic well from municipal pumping. Below is an example of the basic calculation: (21 feet of total drawdown) minus (10 feet of reasonable drawdown due to municipal pumping) minus (8 feet of drawdown due to drought) minus (2 feet of drawdown due to other domestic wells) equals 1 foot of unreasonable drawdown due to municipal pumping. [ = 1] One foot of unreasonable drawdown due to municipal pumping divided by 21 feet of total drawdown equals 4.8%, which became the WMHB s recommendation to the utility to provide mitigate. [1 21 = 4.8%] These are the factors that provided the analytical basis for establishing the degree of unreasonable drawdown due to municipal wells, and estimating the amount of mitigation that should be provided by the utility to the property owner. The WMHB s assessment and recommendations were advisory to the utility involved and typically each utility affected (DWR, STMGID, and in one instance, TMWA) responded to the property owner in their own way. STMGID s responses, which were typically more generous than recommended by the WMHB were agreed to by their Local Managing Board and approved by their Board of Trustees. DWR s Director typically viewed the WMHB s recommendation as the maximum level of mitigation that could be viewed as appropriate, and in the one case involving TMWA the matter was referred to the State Engineer, which upheld TMWA s position that no mitigation was warranted due to the property owner s well having a later priority date than that of TMWA s production well. From 2004 through the end of 2008, forty domestic well mitigation cases were addressed. Of these: Fifteen applications were found not to have demonstrated an unreasonable impact due to municipal pumping. Of these, four were in the Whites Creek Estates subdivision of STMGID, eight were in the Mt. Rose/Galena/Callahan/Government Lots area, one was in North Lemmon Valley, one was in Southeast Lemmon Valley, and one was in Southwest Washoe Valley; 4 Some other factors that might influence a well s productivity, such as the well s age or condition, were not generally included in the analysis. 18

19 Eighteen cases in the Mt. Rose/Galena/Callahan/Government Lots area were identified as having been unreasonably impacted by municipal pumping; Six Lemmon Valley properties were found to have been unreasonably impacted by municipal pumping, one in West Lemmon Valley and five in North Lemmon Valley 5 ; and One property in the Whites Creek Estates subdivision of STMGID was identified to have been unreasonably impacted. Appendix C is a summary table showing the key factors described earlier in this section for each case, as well as the recommended well mitigation determinations for all such cases between 2004 and In late 2008, DWR staff became increasingly concerned about apparent inconsistencies in the way domestic well mitigation cases were being handled. Examples such as different decisions about reasonable impacts of municipal pumping, and the drawdown attributable to drought for properties in close proximity to each other raised staff concerns about the scientific and technical basis for these determinations. In addition, as economic conditions in the area worsened and property owner access to financial resources to cover the cost of connecting to the community water system or deepening their domestic well as a result of a well failure grew, staff realized that the time consuming and technically demanding nature of the WMHB process, as it had evolved over time, was no longer particularly responsive to either the needs of potentially affected property owners or the utility. Given DWR s recognition of the impacts of municipal pumping on domestic wells in the Mt. Rose-Galena Fan areas, a more effective and efficient solution to addressing domestic well mitigation claims seemed to be needed. DWR staff believed that a more systematic approach that would provide affected property owners with a predictable, consistent, and timely response to domestic well mitigation issues seemed likely to address both the needs of property owners and to provide opportunities for DWR to meet the community s needs in a more resource efficient manner. Implementing such an approach, however, required a rigorous evaluation of current and future demands and potential impacts on the portions of the aquifer being used by domestic wells to ensure that the approach would address both near term and longer term impacts. As an interim approach to providing mitigation while necessary technical and analytical work was being completed to support a systematic approach, in early 2009 DWR began applying a flat 35% discount to all connection fees charged for converting from a domestic well to the municipal water system in the Galena Terrace Estates subdivision. Property owners were also reimbursed for 35% of their on-site costs to connect to the community water system and abandon their domestic wells as well. The goal was to establish an appropriate and equitable connection fee structure for residents who would need to hook up due to having community water service available, as well as additional strategies to address domestic well mitigation issues for those 5 As discussed earlier in this Status Report, DWR s analysis of the cause of well failures in North Lemmon Valley would not result in providing mitigation for unreasonable impacts of municipal pumping to domestic well owners in the Heppner Subdivision. There is no evidence that municipal pumping has negatively impacted domestic wells in the area. 19

20 properties that would not likely be served by a community water system in the foreseeable future. 5. Domestic Well Mitigation Proposals for Southwest Truckee Meadows Service Area Both this Status Report and the Mt. Rose Groundwater Management Plan (see Appendix B) acknowledges that municipal pumping has had an impact on domestic wells on the Mt. Rose- Galena Fan. The goal of Mt. Rose Groundwater Management Plan is to provide for the sustainable management of municipal wells in groundwater basins where property owners have the opportunity to obtain loans to support converting from a domestic well or septic system to community water or sewer systems through the County s Water and Sewer Financial Assistance program. Among other management strategies, the Mt. Rose Groundwater Management Plan establishes that groundwater use by municipal water systems on the Mt. Rose-Galena Fan should be limited to a maximum of 5660 acre feet. Current municipal production serving DWR and STMGID customers is 3660 acre feet, so the additional 2000 acre feet of municipal supply could be anticipated to be developed in the future to support build out of communities such as Montreux, the Estates at Mt. Rose, etc. Most of the remaining water rights on the Upper Mt. Rose-Galena Fan have been acquired by developments such as Montreux, the Estates at Mt. Rose and the Callamont to support build-out of these developments, which means that only limited water rights are available for any other purpose. Beyond this planned development, DWR would recommends that any new development in this area bring alternate resources, such as surface water, to support new construction. In looking at the longer term and developing groundwater management and mitigation strategies for the upper Mt. Rose-Galena fan areas, DWR staff looked at strategies to address a number of specific conditions, including domestic well conversions, new development of individual, undeveloped parcels interspersed in existing areas with community water service, and how to address domestic wells where municipal pumping has had an impact but providing municipal water is prohibitively expensive due to the long distances and low density of development. 5.1 Proposed Approach to Domestic Well Mitigation and Proposed Schedules of Fees and Charges for the Mt. Rose-Galena Fan Areas DWR staff has divided the proposed approach to domestic well mitigation into two parts: a. Those involving domestic well conversions, and b. Those involving well deepening. 5.1.a Domestic Well Conversions and Domestic Well Mitigation The policy objectives of the proposed approach to mitigating the impacts of municipal pumping on domestic wells in the Mt. Rose area is to establish an approach that provides affected parties with certainty, ensures that parties with similar circumstances are treated equably, and that the utility s response to requests for mitigation is timely. The systematic approach presented here is 20

21 designed to achieve these outcomes. Implementation of any changes will require modifications to existing ordinance and policy direction. Table 1 shows current connection fees for residents of the Galena Terrace Estates and Mountain Meadows Subdivision (also known as Callahan Ranch) needing to convert from a domestic well to the community system. These fees are based on current policy and ordinance. Table 1 Current Fee Structure Callahan Ranch (Typical Residential Connection) 1 Connection Privilege Fee (typical 3/4 Connection) $4, Water Treatment Plant Fee $7, Main Extension Fee ($10/front foot, by current policy) 2 $1, Meter Pit Installation $1, Total $14, Notes: 1) Connection fee varies based on specific size of the requested connection 2) Assumes 150-foot wide lot. Under the current policy, when faced with converting from a domestic well to the community water system, a property owner must add $4,000 to $6,000 in on-site costs to cover extending the water line from the meter to the residence, to adjust household plumbing to accept water from the new source and to cover the cost of abandoning the domestic well. When on-site costs are added to the $14,382 connection fee, brings the total to $18,000 to $20,000. Many property owners find it particularly difficult to deal with this up-front, out of pocket cost, especially in these economic times. DWR staff recognizes the difficulty of this situation and has systematically worked through the issues to develop the alternate proposals presented below for the Board s consideration. The proposed Mt Rose Area Schedule of Fees and Charges (see Table 2) would apply to only those properties identified on the Schedule of Charges and Fees Map (see Figure 13). Table 2 is a proposal for revised fees and charges for properties currently being served by a domestic well that must convert to the community water system due to having community water service available to their property. The proposed domestic well mitigation for Callahan Ranch property owners is 100% of the fully allocated cost of the water lines of $ , or 57% of the total water facility cost, but not including on-site cost. 21

22 Figure 13 Southwest Truckee Meadows Proposed Schedule of Charges and Fees Map 22

23 Table 2 Proposed Mt Rose Area Schedule of Fees and Charges Domestic Well Conversion (Callahan Ranch Example) Connection Privilege Fee (3/4 Connection) 1 $4, Main Extension Fee (Actual Cost) 2 $7, Meter $ FlexNet Fee (automated meter reading device) $ Meter Set Fee $ Subtotal $12, Domestic Well Mitigation Connection Credit 3 ($7,849.39) Total $4, Notes: 1) Connection Privilege Fee varies by connection size per Ordinance at time of payment. 2) Main Extension Fee consists of construction costs for Callahan Ranch water main extension Program ($1,781,811.89) divided by the number of potential residential services (227). Main extension fee may be different for other areas. 3) Domestic Well Mitigation Connection Credit is a mitigation for unreasonable municipal well impact upon domestic wells. Property owners within Special Assessment District 5 who have completed payment of their assessment and are converting from a domestic well to the community system will receive a Domestic Well Mitigation Connection Credit equal to the assessed amount for water infrastructure. The analytical and policy basis for this proposal presented in Table 2 is as follows: Increases in municipal pumping to support new development have resulted in drawdown to the water table in the Upper Mt. Rose-Galena Fan area that has produced negative impacts to domestic wells. Those parties benefitting from the operation of municipal wells, i.e., the customers of DWR and STMGID in the area, should be responsible for the cost of mitigating the impacts of municipal pumping. The extension of water lines into the Callahan Ranch area, for example, provided a mechanism for municipal water providers to address the unreasonable impacts to properties with domestic wells by connecting Callahan Ranch properties to the municipal system and the cost of this project is properly allocated to municipal water customers. Property owners converting from domestic wells to the municipal system should pay the General Connection Privilege Fee of $4200 because these funds are used to pay for distribution and fire storage, and water transmission and disinfection facilities that are also a part of any community water system. To apply this approach, if adopted by the Board, DWR would revisit each domestic well conversion in the Mt. Rose area defined by the Schedule of Charges and Fees Map and adjust the 23

24 fees charged to comply with this proposal. Property owners who over-paid when they connected would receive a refund to bring their costs for water system facilities into line with this proposal. The basic approach here would be applied to other areas outside of Callahan Ranch where the availability of a water line would require conversion of a domestic well. The mitigation proposal for properties converting from domestic wells to the municipal system does not contemplate providing mitigation for the on-site costs associated with a domestic well conversion which, as described earlier, can range from $4000 to $6000 per property. The analytical and policy basis for this proposal is as follows: Many domestic wells in the area being covered by this discussion were constructed with a relatively shallow penetration of the aquifer. As shown in Figure 9, the level of the water table in the Callahan Ranch area is closely tied to annual precipitation, meaning some part of the drawdown of the water table is not attributable to the operation of municipal pumping; and The age, condition and other characteristics of original construction of individual wells play some role in well failures, which is not directly associated with municipal pumping. In order to facilitate connections for property owners facing both public right-of-way facility costs and on-site costs, the County has established the Water and Sanitary Sewer Financial Assistance Program, which provides for financing both public right-of-way and on-site costs. 5.1.b Domestic Well Mitigation Where Community Water Service Is Not Available Extending community water service to some areas on the Mt. Rose-Galena Fan is prohibitively expensive due to the long distances that would need to be covered by water lines and the low density of development. The mitigation being proposed for the Callahan Ranch area where municipal water users, as beneficiaries of municipal pumping, cover the cost of water line extensions is not warranted in these situations because there are more cost effective ways to ensure that properties with domestic wells continue to have water, even with a declining water table. DWR estimates that approximately 150 Upper Mt. Rose-Galena Fan properties in areas where service is not available could be affected in the next 10 to 20 years by a declining water table. Staff proposes that in these situations mitigation be in the form of paying for a specified amount of well deepening. Current estimates indicate that 100 feet of the additional depth would allow a typical well to penetrate the aquifer at a depth that would ensure water would be available to that well when the 5660 acre feet of demand on the system is reached. At today s well drilling costs, 100 feet of deepening is estimated to cost $5000. The proposed mitigation would be limited to well deepening and is not proposed to cover any mechanical or electrical costs that might be required. 5.1.c New Development of Individual, Interspersed Undeveloped Parcels Build-out on the Mt. Rose-Galena Fan area is not complete and there are undeveloped parcels in areas served by water lines that would need to be treated as new development, with appropriate fees and charges being applied to cover the cost of providing service. For the most part, the individual, undeveloped parcels covered by this proposed schedule of fees and charges are 24

25 interspersed in developed areas such as Callahan Ranch. This proposal would not cover properties typically being handled through DWR s development review process (e.g., additional undeveloped parcels in areas such as Montreux, or the Estates at Mt. Rose) where new infrastructure (water lines, storage, etc.) is required and either constructed by DWR or built and dedicated to the County by the developer. Table 3 is the proposed approach to assessing fees and charges to those individual parcels that would be considered new development as delineated in this discussion. Table 3 Proposed Mt Rose Area Schedule of Fees and Charges New Development of Interspersed, Individual Parcels No Meter Pit Installed Meter Pit Installed Without Meter Meter Pit Installed With Meter & FlexNet Connection Privilege Fee (3/4 Connection) 1 $4, $4, $4, Meter Pit Installation 1 $1, $0.00 $0.00 Main Extension Fee 2 At Cost At Cost At Cost Meter $0.00 $ $0.00 FlexNet Fee (automated meter reading device) $ $ $0.00 Meter Set Fee $0.00 $ $0.00 Total $5, $4, $4, Plus Applicable Main Extension Fee At Cost At Cost At Cost Notes: 1) Connection Privilege Fee varies by the size of the connection, and both the Connection Privilege Fee and the Meter Pit Installation fee are subject to the fees and charges provisions of the Water Rate Ordinance in effect at time of payment. 2) Main extension fee may apply if an over-sizing or developer agreement exists or if a main extension is provided to serve property. 6. Washoe County Water and Sanitary Sewer Financial Assistance Program As DWR staff has worked with community interests and property owners facing conversion of domestic wells and on-site wastewater systems (septic tanks) to community water and sewer systems, resource constraints in paying up front connection fees have been a common concern. In 2008 DWR staff worked with legal counsel and other County staff to develop a bill draft request for the 2009 Legislature. Assembly Bill 54 authorized Washoe County to create a Water and Sanitary Sewer Financial Assistance Program by local ordinance. DWR staff developed the 25

26 program and the enabling Ordinance and program Policies and Procedures were adopted by the Board on July 27, 2010 (See Appendices D and E respectively). Implementation of the Financial Assistance Program got underway in the early fall of 2010 and activities through the end of December 2010 are summarized in Table 4 below. A report providing additional information and status for the Financial Assistance Program through December 31, 2010 is included as Appendix F to the Status Report on Groundwater Management and Domestic Well Mitigation Issues. The summary report, which includes Table 4, is provided as Appendix F. Table 4 Summary of Water and Sewer Financial Assistance Program through 12/31/10 Status and Area Water or Sewer On-Site Costs DWR Fees Grants Callahan Ranch Mitigation Estimated Loan Amount 1) 2) CONSTRUCTION COMPLETE Mayberry Ranch Estates S 7, , (5,100.00) - 18, Mayberry Ranch Estates S 9, , (5,100.00) - 20, ) Callahan Ranch W 5, , (7,142.56) 13, ) Lemmon Valley W 6, , , Total final costs 28, , (10,200.00) (7,142.56) 68, UNDER CONSTRUCTION 5) Mayberry Estates S 8, , (5,100.00) - 20, Total estimated costs 36, , (15,300.00) (7,142.56) 88, Sewer related S 25, , (15,300.00) - 59, Summary Water related W 11, , (7,142.56) 28, Total estimated costs 36, , (15,300.00) (7,142.56) 88, APPROVED / WAITING FOR BIDS 6) Cold Springs S 7) Lemmon Valley W DENIED 8) Callahan Ranch W The Callahan Ranch case that was denied was reviewed by the Financial Assistance Loan Committee twice and ultimately denied based on conditions related to ability to repay the loan. 26

27 7. Proposed Program Funding DWR has been funding its domestic well mitigation obligations from Water Utility operating revenues for many years. In the current fiscal year (FY ), the domestic well mitigation program is funded at $200,000 and DWR intends to continue funding the program in future years. DWR estimates that if the Board adopts the proposed approach to fees for properties on the Upper Mt. Rose-Galena Fan, refunds will be due to a number of property owners who paid higher fees than those proposed. Once these refunds are processed, DWR would expect to be able to set aside between $75,000 and $100,000 from the current fiscal year s budget to meet future obligations. As noted earlier, DWR expects to have to provide mitigation for about 150 well deepenings during the coming 10 to 20 year timeframe. The total estimated cost of this effort is $750,000 in current dollars, so the goal would be to build a program fund over time of $1 million to ensure that future mitigation obligations can be met. With ongoing funding available for the domestic well mitigation program of $200,000 per year, DWR expects to have the financial capacity to address any domestic well mitigation needs that arise during the coming years. CONCLUSION DWR has been working to responsibly manage critical groundwater resources for many years. The region s groundwater management challenges are complex and, as has been described in this report, the most appropriate solutions in one area are not necessarily the best fit in another area. DWR s recent focus on creating a proposal for a comprehensive and systematic approach to mitigating for the unreasonable impacts of municipal pumping to domestic wells on the Upper Mt. Rose-Galena Fan is designed to provide affected property owners with certainty about the cost of connecting to the community water system and to make the process simple, understandable, and efficient for both property owners and DWR. DWR is strongly committed to managing critical groundwater resources to ensure these valuable community assets are available to meet today s needs as well as those of tomorrow. The groundwater management and domestic well mitigation strategies that have been described and discussed in this Status Report are well matched to the current situation, but a strong commitment to adaptive management is required to ensure that changing conditions are identified and incorporated into the management approach over time. The Mt. Rose Groundwater Management Plan explicitly adopts an adaptive management approach as a key element of ensuring that groundwater resources in the Southwest Truckee Meadows are managed for long term sustainability. Over time, DWR expects to apply the adaptive management framework identified in the Mt. Rose Groundwater Management Plan to the other the groundwater resources it manages. 27