Meeting Date:           September 15, 2003               Budgeted: FY 2003-2004

                                                                                    Program/Line Item No.:  4-2-6

Staff Contact:             Stephanie Pintar                     Cost Estimate: $75,000


General Counsel Approval: Reviewed ordinance text and concurred.

Committee Recommendation: The Administrative Committee reviewed the proposed program on September 10, 2003 and recommended approval.  Water Demand Committee provided direction on the content of the ordinance and has reviewed the draft document.

CEQA Compliance:  Categorical exemption under Class I, §15301 of CEQA (California Environmental Quality Act)


SUMMARY:  The attached draft Ordinance No. 110 (EXHIBIT 7-A) expands the District’s rebate program to include rebates for ultra-low water consumption dishwashers and washing machines, cisterns, hot water demand pumping systems and dual-flush ultra-low flush toilets.  The proposed program also adds the California-American Water Company (Cal-Am) system subunits of Hidden Hills, Ryan Ranch and Bishop, and adds private well users that are supplied by sources in the Monterey Peninsula Water Resource System (MPWRS) to the list of potentially qualified applicants.  The expansion of the program to Cal-Am customers served by sources outside the MPWRS responds to a request made by Cal-Am at the October 1999 Board meeting.  The current rebate program is available to all qualifying customers of water systems within the MPWRS.


The proposed expansion of the rebate program will accelerate water savings within the District.  Between January 1997 and October 31, 1999, District staff has estimated that the toilet rebate program has saved more than 105 acre-feet of water per year (AFA) and has contributed to the replacement of nearly 4,600 toilets, many of which would not have been replaced without the program.  The proposed expansion of the program is expected to save 1,300 gallons-per-year for each dishwasher replaced, 5,200 gallons annually for each ultra-low consumption washing machine, up to 3,000 gallons of water previously used for irrigation for cisterns with storage of 3,000 gallons (the maximum proposed rebate), 10, 220 gallons-per-year for installation of a Hot Water Demand Pumping System, and savings averaging 0.35 gallons-per-flush for each dual-flush ultra-low flush toilet.


Rebates for ultra-low consumption dishwashers and washing machines for energy savings are also currently available through Pacific Gas & Electric Company (PG&E).  PG&E offers $75 rebates for Energy Star compliant washing machines and rebates of $50 for Energy Star dishwashers.  Energy Star compliant washing machines and dishwashers do not necessarily qualify for a rebate under the District’s proposed program, as the District’s definition for these appliances is stricter.


RECOMMENDATION:  Staff recommends the Board approve the first reading of Ordinance No. 110.  If the first reading is approved, second reading will take place October 20, 2003.  If adopted in October, the expanded rebate program is scheduled to begin on December 1, 2003.


The toilet replacement rebate program is funded jointly by the District and Cal-Am.  Cal-Am will continue to partner with the District for toilet replacements, and may add the other fixtures and/or appliances to its funding in the future.  Staff is in the process of working with Cal-Am with the goal of having them join in the expanded program.


The fiscal year 2003-2004 budget has $75,000 available for rebates, and the District may use the $75,000 for rebates of the devices included in the proposed ordinance.  An additional $75,000 is reimbursable by Cal-Am for toilet replacement rebates.  In the event that participation exceeds demand in the early months of the expanded program, staff will budget accordingly for the next fiscal year.  Funds for next fiscal year are determined as part of the annual budget process.


Although it appears that the toilet rebate program does not require any CEQA process due to its de minimis effect, staff nonetheless recommends use of the Class 1 Statutory Exemption for Existing Facilities in CEQA Guideline 15301 for this project.  Class 1 consists of the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of use beyond that existing at the time of the lead agency's determination. 


Section 15301 provides the following example of such a project:  "(a) Interior or exterior alterations involving such things as interior partitions, plumbing, and electrical conveyances.”  Section 153012 states that the "key consideration" in the use of that statutory exemption is "whether the project involves negligible or no expansion of an existing use."


The proposed rebate ordinance only enables minor alteration of existing private structures, and these alterations are limited to replacement of existing plumbing fixtures.  Unquestionably this rebate program does not involve an expansion of an existing use, and because the replacement plumbing fixtures are low flow, this program will cause a reduction in existing water use.


BACKGROUND:  On November 15, 1999, the District considered an ordinance (Ordinance No. 94) that would have expanded the toilet replacement rebate program to include rebates for ultra-low consumption dishwashers and washing machines.  The proposed program also added the Cal-Am Hidden Hills, Ryan Ranch and Bishop subunits and added private well users that are supplied by sources in the MPWRS to the list of qualifying properties.  The expansion of the program to Cal-Am customers served by sources outside the MPWRS was proposed in response to a request from Cal-Am General Manager Judy Almond at the October 1999 Board meeting.  Ms. Almond asked the District to include Hidden Hills to assist Cal-Am with its conservation effort in that area.  The District’s current rebate program is available to all qualifying customers of water systems within the MPWRS.  Cal-Am co-funds the program with the District.


The Board direction from the November 15, 1999 first reading of Ordinance No. 94, Modifying the Toilet Retrofit Rebate Program to Include Rebates for Ultra-Low Consumption Dishwashers and Washing Machines, was “to continue consideration of this ordinance to a date uncertain.” 


IMPACT ON RESOURCES:  Administration of the program is performed by the District’s Water Demand Division.  Adoption of Ordinance No. 110 may impact staff by increasing the number of applications for rebates received by the District.  Positions impacted by an increase in applications will include the Conservation Technician, the Accountant and the Office Specialist. Currently, staff allocates time to processing rebates as a part of the data entry function.  These activities will continue with the expanded program and may increase to accommodate the increased demand for rebates.  In addition, periodic inspections are performed to verify installation of the fixtures for which a rebate was issued.  Even though spot inspections are done, all applications require installation of the fixtures and certification under the penalty of perjury that the information on the application is true and complete.