Since 2007, the City has entered into agreements with MWDOC for the participation in several water conservation programs. These programs have contributed to the City’s success in water conservation. In addition to offering an incentive to its customers, the conservation programs assist the City in meeting the goals of Senate Bill X7-7, which calls for a 20 percent reduction in water consumption by 2020.  In terms of conservation, the City’s annual water production has been reduced to approximately 22,000 acre-feet, from 33,000 acre-feet. Even though the City is no longer mandated to meet conservation targets, Garden Grove customers are still conserving each month. Since 2015, the City has reduced water usage by nearly 20 percent.

In 2015, the City entered into an agreement with MWDOC that combined all of the conservation programs and incentives into one agreement. Addendums to this agreement will be issued for changes involving MWDOC Board approved items, grant funding, and changes to incentive programs, including funding and incentive levels. The City’s approved contribution to the program was in the amount not to exceed $42,000.

Limited grant funding, provided through MWDOC, is available to cover customer rebates. However, two rebate programs require City contribution for inspection costs. The following describes the two rebate programs and the associated costs:

• The Turf Removal Rebate Program provides residential and commercial customers with rebates for replacing turf with drought tolerant plants or artificial turf. The total rebate available is $1 per square foot for residential and commercial customers.  Rebate funding is provided through MWDOC directly to participating customers. The agreement explains program requirements for pre- and post-turf removal inspections that are required for all applicants.  In addition, participating agencies are required to specify on the agreement if agency staff or MWDOC’s contracted consultant, Mission Resource Conservation District (MRCD), are responsible for conducting both inspections.  Due to limited staff time and expertise, the City has chosen to obtain MRCD’s services to perform both inspections. The cost per customer to have MRCD perform the inspections on behalf of the City is $222.

• The Spray to Drip Irrigation Rebate Program provides residential customers with rebates for converting existing spray irrigation to a drip irrigation system. The total rebate available is $175 per kit. Rebate funding is provided through MWDOC directly to participating customers. Similarly to the Turf Removal Rebate Program, pre- and post-drip conversion inspections are required for all applicants. The cost per customer to have MRCD perform the inspections on behalf of the City is $222.

As mentioned previously, Garden Grove customers are effectively reducing their water usage. As a result, City water revenues have been impacted. Therefore, the City desires to discontinue its participation in the Turf Removal and the Spray to Drip Irrigation Rebate Programs until revenues are steady. At this time, there are 18 Garden Grove customers on the waitlist for the Turf Removal Rebate Program and 0 customers on the waitlist for the Spray to Drip Irrigation Rebate Program. The City has designated a funding cap of $3,996 to process those on the waitlist before formally discontinuing participation in the two programs. Additionally, the agreement amendment was created to make certain changes to provisions regarding detailed verification of the installation of items and devices installed as part of certain water conservation incentive programs.

This program will be funded from the Water Enterprise Fund. There is no impact to the General Fund. Garden Grove’s contribution for the program will not exceed $3,996.

It is recommended that the City Council:

• Approve the Amendment to the agreement with the Municipal Water District of Orange County (MWDOC) for the City's participation in the Water Conservation Rebate Programs;
• Authorize the Mayor to execute the Amendment on behalf of the City and to make minor modifications as appropriate thereto; and
• Authorize the Finance Director to approve payment to participate in the Water Conservation Rebate Programs to MWDOC, not to exceed $3,996.
  

By:     Katie Victoria, Senior Administrative Analyst