California depends on fresh water from the Sacramento-San Joaquin Delta to:

1
Harbinger of Potential Catastrophic Loss of Water
The Delta

• California depends on fresh water from the
  Sacramento-San Joaquin Delta to
• Supply more than 22 million Californians, plus
  industry and agriculture
• Support 400 billion of the states economy

Sacramento River
To San Francisco
l Stockton
Clifton Court Forebay
California Aqueduct
San Joaquin River
2
Water Supply Uncertainty
The states water supply flows though the Deltas
levee system.

• Earthquakes, wind or flooding could cause a
  Katrina-like levee collapse flooding much of the
  Delta.
• 6.5 quake estimated to cause collapse of 30
  levees.
• Studies predict a 66 chance of a 6.5 quake in
  next 50 years.
• Salt water would rush in from the bay to fill
  collapsed islands.
• Delta water supply becomes unusable within hours,
  potentially for years.

Pumps
3
6.5 Earthquake The Beginning(Delta Looking
Southwest over Sacramento)
4
6.5 Earthquake The Aftermath20 Islands Flooded
- Saltwater Intrusion(Delta Looking Southwest
over Sacramento)
5
Isolated Canal Would Protect Water Supplies and
Contribute to Northern Economy
Building a canal around the Delta will reduce
risk

• Eliminates levee failure as a threat to water
  supplies
• Improves water quality
• Provide flexibility to address potential impacts
  of climate change on water supply
• Provide better protection for Delta fish while
  protecting Californias economy
• Provide a mechanism for reliable water marketing
  by northern Californians

6
Current SWP Reliability
Supply Gap
Reliable Supply
7
Water Banking An Environmentally Friendly
Physical Solution
Legal Foundation The ability of a district or
city to import water into a groundwater basin for
later extraction and use without abandonment or
prescription by others.
8
Water Districts Important Participants in Water
Supply Control
9
Applicable Legal Principles Water Law of Surface
Streams

• Water Rights Usufructory Rights
• Riparian Water Law - Origins in England
• Appropriative Water Law - Western U.S.
• California Water Law - A Blend of Both
• Pre 1914
• State Water Resources Control Board
  Predecessors
• Constitutional Prohibition of Waste
• Prescription (analagous to adverse possession)
• Abandonment

10
Applicable Legal Principles Water Law -
Groundwater

• Groundwater Doctrines -
• Correlative Rights
• Overdraft
• Public Agencies and Prescription
• Groundwater Banking
• Physical Put Take
• In-Lieu Banking

11
Applicable Legal Principles Miscellaneous Water
Law Issues

• Public Trust Doctrine
• Conservation/Transfer

12
Related Legal Issues

• Federal Endangered Species Act
• California Endangered Species Act
• CEQA - CA Environmental Quality Act
• NEPA - National Enviro. Policy Act
• Contract Law

13
Key Transfer Concepts

• Physical
• Moving water across Delta often key
• But, south of Delta transfers helpful in some
  situations
• Often requires some storage capability south of
  Delta
• Physical layout important - not necessarily a
  deal killer due to Exchanges
• Legal
• Pre-1914 others subject to environmental
  regulation
• Appropriative - subject to SWRCB approval
• Riparian - complicated mechanism

14
Market Players

• Wholesale Water Agencies
• e.g. Kern County Water Agency
• Retail Water Districts
• e.g. Wheeler Ridge-Maricopa WSD
• Mutual Water Companies
• e.g. Westside Mutual Water Co.
• Investor Owned Utilities
• e.g. California Water Service Co.
• City water departments
• e.g. LA DWP
• Joint Powers Agencies
• e.g. Kern Water Bank Authority
• Private owners

15
Transfer Issues

• Risk regarding regulatory approvals and ownership
  issues
• Risk of hydrological problems
• Risk of facility failures
• Points of delivery
• Power costs
• Water quality