Signal Hill Council supports agreement that may resolve litigation over groundwater storage

Sean Belk
Staff Writer

A long-running legal battle over groundwater storage in the Central Basin of Southern California may soon be resolved after regional water agencies, several local municipalities and private pumpers recently reached a landmark agreement.
The Signal Hill City Council gave the go-ahead at its Aug. 20 meeting to authorize the city attorney to initiate a new settlement in court that may end years of disputes over whether to give pumpers access to groundwater storage. The city attorney is expected to submit documents in court during a status hearing today, Aug. 23.
After almost two years of negotiations, 26 gateway cities, the Water Replenishment District of Southern California (WRD), the Central Basin Municipal Water District and various private pumpers have come to a tentative agreement on a new groundwater-storage plan, according to city staff.
The new plan comes after Signal Hill, Cerritos and Downey objected to a proposal brought forward in 2009 by a group of seven water-rights holders in mediation with WRD. The cities claimed that the initial plan would have given large pumpers more control over water-storage projects and essentially driven up water prices.
“This has been a long time coming,” said Signal Hill City Manager Ken Farfsing. “If we could move forward with this, we could at least put to bed or put to rest one of the litigations we have against WRD.”
Signal Hill City Attorney David Aleshire said the City gave up some entitlements but the new water-storage plan was made as a compromise and, if approved, would be beneficial to all parties involved.
“We had to start negotiating with the other side, and we had to make some compromises,” he said. “I think the WRD role is a little more than what we wanted it to be, but it’s not what it would have been under the old proposal.”
Aleshire added that the new agreement doesn’t settle disputes regarding another lawsuit by Signal Hill, Cerritos and Downey against WRD that claims the water agency did not follow state law in establishing its water-replenishment rate in recent years.
While a final judgment has not been issued, a judge has so far ruled twice that WRD did not follow Proposition 218, a law approved by voters in 1996 that requires governments to notify property owners and give them the right to protest any proposed increases in assessments and taxes before they’re voted on and approved.
Farfsing said WRD tried to add language in the water-storage agreement that would require a “uniform” replenishment-assessment rate for both West and Central Basins– a stipulation that has been disputed by Signal Hill and other cities. However, he said the language has since been removed. “I think WRD recognizes that’s a different battle,” he said.
Currently, Signal Hill has rights to pump 2,022-acre-feet of water per year from local aquifers. The City then pays WRD an annual water-replenishment assessment that is eventually passed on to residents through their water bills that are paid to the City.
This allocation, however, doesn’t always meet the City’s water needs, and sometimes the City is forced to lease water or purchase imported water from the Metropolitan Water District of Southern California (MWD) at a more expensive price than WRD’s rate.
Still, for decades, cities and pumpers throughout the Central Basin have been unable to store water in underground aquifers as a way to plan for additional population growth and periods of drought and water surpluses.
After several failed attempts to establish a water-storage plan that all parties can agree on, Signal Hill reached out to Long Beach in January 2012 to discuss coming up with a compromise. The discussion eventually included Cerritos, Downey and Lakewood to form a working group of five cities. The group eventually gained consensus from various stakeholders and water entities, while working through the City Manager’s Committee of the Gateway Cities Council of Governments.
Though some large, private pumpers, including the Golden State Water Company and Tesoro refinery, may still have objections, Farfsing said the new agreement is the best shot at developing a “consensus proposal” that is more representative of all pumpers in the basin rather than the last water-storage plan.
He said the new agreement establishes a “pumper panel” of water-rights holders, superseding a “watermaster,” to determine whether to allow cities and other pumpers to store water in underground aquifers and enable them to purchase additional groundwater. Pumpers would also be able to carry over stored water to the next year if it goes unused.
The water, however, wouldn’t come for free. Cities would still have to pay WRD’s water-replenishment rate of $268 per acre-feet of water. The rate, however, is much less than purchasing imported water from the MWD at $987 per acre-feet of water.
Farfsing said the new set-up would provide more “flexibility” for pumpers to conduct water-storage projects within the Central Basin, which extends from Commerce to the Long Beach coast and the Newport-Inglewood Faultline to the Orange County border.
According to a city staff report, the new agreement guarantees Signal Hill space to store up to 1,011 acre feet of water either through purchasing imported water or converting unpumped water into stored water. The plan also provides additional space, on a first-come, first-served basis, for Signal Hill to store an extra 1,011 acre feet of water.
“It basically provides us with additional flexibility as a community to do storage projects,” Farfsing said. “Maybe you don’t have to purchase any additional water rights for decades into the future.”
He said, in total, the Central Basin has space for up to 233,000 acre-feet of water in underground reservoirs that pumpers throughout the basin may be able to tap, adding it’s important for cities to plan for upcoming water shortages as water is expected to become a more expensive commodity.
“We’re really going to have to become more self-reliant as regions and as communities to deal with what could be some pretty major groundwater shortages or drinking-water shortages in the future,” Farfsing said.
He added, however, that the new water-storage agreement, which includes a framework of 19 key elements, is still a “living document” and may need to be “fine-tuned” in court after it’s implemented.

Other Council highlights
Photos by Sean Belk/Signal Tribune<br><strong>Major sponsors of the 2013 Concerts in the Park series were recognized during this week’s Signal Hill Council meeting.</strong>
Recognitions At the beginning of the meeting, the Council expressed heartfelt sympathy over the recent passing of Frank Virga, who was recently reappointed to a third term on the Signal Hill Civil Service Commission and has been a longtime community leader. The Council adjourned the meeting in honor of Virga, and Signal Hill Mayor Michael Noll presented Tony Virga, Frank Virga’s son, with a certificate in honor of his father’s dedicated service to the community. The Council also recognized major sponsors of the 2013 Concert in the Park series and presented Ted Georges, owner of the Golden Eagle Restaurant, with a proclamation, celebrating the restaurant’s 25th anniversary.
<strong>Ted Georges, left, owner of the Golden Eagle Restaurant, speaks to the public during the Signal Hill Council meeting on Aug. 20 after receiving a proclamation from Mayor Michael Noll that celebrates the restaurant’s 25th anniversary.  </strong>

SHP The Council granted Signal Hill Petroleum (SHP) with a six-month extension on its conditional-use permit that allows the company to operate seven consolidated drill sites with oil and gas storage, processing and shipping operations and a gas turbine facility within the city. City planning staff said the extension is needed to conduct further analysis of the sites, while developing a landscape plan and environmental reviews. City staff said SHP plans to request a long-term CUP but didn’t specify for how long. According to a staff report, SHP contributes approximately $619,000 annually to the City’s General Fun in business franchise tax, oil-well permits and oil-barrel taxes. The City pays for maintaining the Oil Field Services Program and annual facility inspections.

Public art The Council agreed to enter into a contract with artist Jon David Cicchetti of Landscape Architects for the design, fabrication and installation of a new public art piece that will be placed in front of the Signal Hill Police Department’s new headquarters. The contract was awarded for $73,500. The art piece will resemble a plant-like form with a low glass block wall that will have historic pictures and images etched into the blocks. Materials from the former police station will be used in the fabrication of the art piece, including the jail doors and glass block, according to city staff.

Right to Know and Vote The Council voted (3-0) to approve a contract with Orange-based Urban Futures, Inc. to conduct an independent fiscal-impact analysis on the Right To Know and Vote initiative that will be on the ballot during a special election in June 2014. Councilmember Lori Woods abstained from voting on the contract award. Vice Mayor Ed Wilson was absent. The contractor will examine the impacts of the initiative on city services, economic development and other city functions, according to a staff report. The analysis is expected to cost the City $32,665, which was not included in the City’s Fiscal-Year 2014 budget. On top of this contract, the City is also paying $30,000 for county election costs for conducting the special election and $25,000 for a public-information program, according to the staff report.
<strong>SMajor sponsors of the 2013 Concerts in the Park series were recognized during this week’s Signal Hill Council meeting.</strong>

The next Signal Hill Council meeting will take place Tuesday, Sept. 3 at 7pm in the City’s Council Chamber.

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