ITEM:

# PUBLIC HEARINGS

18.

CONSIDER SECOND READING AND ADOPTION OF ORDINANCE NO. 140 AMENDING THE REBATE PROGRAM AMOUNTS, DELETING 1.6 GALLON PER FLUSH TOILETS FROM THE REBATE PROGRAM, AND ADDING REBATES FOR LAWN REMOVAL, SYNTHETIC TURF INSTALLATION, AND OTHER COMMERCIAL/INDUSTRIAL/INSTITUTIONAL RETROFITS

Meeting Date:

#### Yes

From:

Darby Fuerst,

Program/

4-2-4

General Manager

Line Item No.:

Prepared By:

Stephanie Pintar

Cost Estimate:

FY 09-10 Budget for $325,000 +$10,000 Non-CAW WDS

## Committee Recommendation:By a vote of 2-0 on September 14, 2009, the Water Demand Committee supported the proposed Rebate Program amendments.The District’s Technical Advisory Committee (TAC) and the Policy Advisory Committee (PAC) reviewed and supported the ordinance at the September 3, 2009 and October 12, 2009 meetings.

CEQA Compliance:  Categorical Exemption under Class I, §15301

SUMMARY:  Draft Ordinance No. 140 (Exhibit 18-A), expands the Rebate Program to include lawn removal, synthetic turf, high efficiency urinals, pint urinals, rotating sprinkler nozzles, water brooms, high efficiency commercial clothes washers, cooling tower conductivity controllers, air-cooled ice machines, and X-ray film processor recirculation systems.  Other amendments to the Rebate Program include the deletion of rebates for ultra-low flush (ULF) 1.6 gallon-per-flush toilets, increases in current rebate amounts for High Efficiency Toilets, high efficiency washing machines and Zero Water Consumption Urinals, and revisions to Rule 11, Definitions.  The ordinance also modifies the District’s Washing Machine criteria to use a Water Factor, which is the national standard for determining water efficiency.  Draft Ordinance No. 140 includes rebates discussed during the California America Water (CAW) conservation budget hearings in 2008 before the California Public Utilities Commission (CPUC).

Several minor edits were made to the ordinance after the first reading at the October 19, 2009 Board meeting:

• The text approved by Ordinance No. 139 was added to Section 5, C-2.

• The definition of Water Efficient Ice Machine was added and the definition for Washing Machine was amended.

• Ice machine rebate criteria was changed to Tier II from Tier III.  Tier II is the standard for Energy Star.  Energy Star certification is the standard for ice machines.

• Deleted unnecessary language related to “initial installation of…” in Rule 141-A (Qualifying Devices) as the installation requirement is included in Rule 141-C-1 (Eligibility).

• An exemption was added to Rule 141-C-3 (Eligibility) for multiple Rebates for Clothes Washers that have been removed from the Site by a previous owner/tenant.  There are circumstances where a Washing Machine is removed by a tenant or former owner and the new owner/tenant is purchasing a machine.  In that scenario, the Rebate may be the factor that weighs in favor of a High Efficiency Clothes Washer, and it is in the District’s and California American Water’s interest to maintain the High Efficiency Washer’s water savings.  The Board must weigh in on this change.

This ordinance is supported by California American Water, the Technical Advisory Committee (TAC), Policy Advisory Committee (PAC) and the Water Demand Committee.

RECOMMENDATION:  Staff recommends the Board approve the second reading and adoption of Ordinance No. 140, as amended.  If adopted, staff will file a Notice of Exemption from CEQA with the County Clerk.  The ordinance has been written with an effective date of January 1, 2010.

BACKGROUND:  All proposed rebate amounts and water savings are supported through extensive research and documentation, particularly the Rebates that are proposed for Non-Residential appliances.  Rebates proposed in Ordinance No. 140 are comparable with Rebates offered by other agencies throughout the state and were reviewed by the Water Demand Committee (WDC), the Technical Advisory Committee (TAC), the Policy Advisory Committee (PAC), and were provided to CAW.  The addition of Non-Residential technology to the Rebate Program is necessary to further reduce water consumption within the District.

IMPACT ON STAFF/RESOURCES:  Increased participation in the rebate program has impacts on staff as the District administers the rebate programs for the District.  However, the District has been able to accommodate the existing program and the new database will enhance staff’s ability to process and issue rebates.  The District’s direct involvement in the administration of the program allows it to ensure that program savings are tracked and are not double counted in another District program.  The cost of administering the Rebate Program is contemplated in the adopted Water Demand Division 2009/10 budget.

The Rebate Program is jointly funded through several mechanisms:  The CPUC approved a $900,000 3-year budget (2009-2011) in the CAW conservation filing that is to fund rebates for CAW customers, the District budgeted$10,000 for Fiscal Year 2009-2010 for non-CAW rebates, and the District was approved \$15,000 annually for a “Cash For Grass” program by the CPUC in CAW’s conservation filing.  The District administers the Rebate Program and tracks the retrofits and water savings that occur, utilizing the District’s extensive property database to verify eligibility.  California American Water supports the expansion of the Rebate Program as it contributes to both entities’ conservation goals.  Since the inception of the program in 1997, about 230 acre-feet of water have been saved.

EXHIBITS

18-A    Draft Ordinance No. 140

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