When the voters approved Measure S – also known as the “Safe, Clean Water and Natural Flood Protection Program” (“Program”) – in November, 2020, they not only renewed an existing, similar parcel tax enacted by the voters in 2012 that was due to expire in 2027, but removed the sunset provision. The current version allows for an annual increase of 2.0% or the Consumer Price Index – Urban Consumer (CPI-U), whichever is higher. In addition, the Board of Directors of the Water District can impose an additional 4.5% increase since Santa Clara County was subject to a flood disaster declaration in 2023. This parcel tax is imposed and collected as part of your property tax bill.  For reasons I will describe below, it is highly likely that the District will raise the rates. 

The Program consists of thirty-two (32) separate projects which are designed to support six “Priorities.”  For example, “Priority A” – “Ensure a Safe, Reliable Water Supply,” consists of three separate Projects: A1: Pacheco Reservoir Expansion; A2: Water Conservation Rebates and Programs; and A3: Pipeline Reliability.  Some of the Projects are funded in whole by Measure S funds, whereas others are funded in part by Measure S funds with the balance coming from either Watershed Stream Stewardship funds (also collected as a separate Parcel Tax), or the Water Utility Enterprise Fund (collected as part of your water bill that you pay to your local water retailer (in this area, this would be San Jose Water Company – a private water retailer). 

Due to projected cost increases for some of these projects. For example, the Pacheco Reservoir Expansion, originally estimated to cost around $900M is now estimated to cost closer to $2.8 Billion, and that doesn’t include financing costs, or take into account that the Environmental Review process has not commenced.  Another project, E-1: the Coyote Creek Flood Protection Project, experienced delays in getting its CEQA documentation prepared, and due to design changes and significant construction cost increases, the project will require an estimated additional $162M.  This will include the planned flood protection measures in William Street Park.    

Measure S continued the prior practice of requiring the District to prepare an Annual Report on how the funds were expended on each Project in pursuit of the attainment of that Project’s objectives as measured by Key Performance Indicators.  The Annual Report is submitted to an Independent Monitoring Committee (IMC), which is tasked to review the District’s performance on each project, prepare and submit a report, and present this to the Board of Directors with comments and recommendations.  As the Chair of the IMC, I will be presenting my Committee’s report and recommendations to the District Board of Directors on Tuesday, March 12, 2024.  Staff will then be given an opportunity to submit their “rebuttal.”  Links to these reports are available and posted online under Agenda Items 3.4 and 3.5, respectively.  2557_A_Board_of_Directors_24-03-12_Amended-Appended_Agenda.pdf 

Overall, the Measure S provided approximately $115M in funding for various projects during FY 2022-2023. Of this amount, approximately $71M was expended.   – about 61% of the total.  Reasons for underspending included pausing projects which saw significant increases in project construction costs, and delays in processing CEQA documentation, among others. One project of unique focus is Project F5: Good Neighbor Program: Encampment Cleanup.  This project supports the District’s efforts, in coordination with local cities, agencies, and the County of Santa Clara, to clean up trash, debris and hazardous pollutants generated by encampments near waterways, some of which are on District-owned property. Here, the funding in the report year (22-23) went towards hiring SJPD for security for Staff conducting cleanups, and to the County to provide Outreach services.  

However, these efforts have come up short, and both the City of San Jose and the Water District have been put on notice by the State Water Board that they must do a lot more to be in compliance with their respective obligations under the Clean Water Act to prevent pollutants from entering the area waterways, or face significant fines and penalties.  The City of San Jose announced on Tuesday that their proposed plan for compliance had been rejected three times by the State Water Board, and a new approach was being planned – one that will involve removing as many as 1,000 individuals along the approximately 140 miles of creeks and waterways under the City’s jurisdiction.  The Water District will also need to address its obligations along some 295 miles of waterways within the District’s jurisdiction. Both the City and the District are meeting to determine the best course of action.  

Last, but not least, there is the serious issue of water SUPPLY.  Anderson Reservoir will not be available for the next 8 – 10 years to store excess water.  There are a multiple number of alternatives to expanding Pacheco Reservoir, including raising the BF Sisk Dam on the San Luis Reservoir – which is currently one of our primary sources, but these alternatives will also cost money and take years to implement. Adding pressure to come up with a solution is the harsh fact that the worsening drought and increased demand on limited resources in the Southwest part of the country (including, of course, the Colorado River), means that our Water District must compete with other agencies such as the Metropolitan Water District (aka the “MET”), which provides water in Southern California for close to half of the State’s population, for precious water resources. 

Yogi Berra once said that “It’s hard to make predictions, especially about the future.”  Between the impact of climate change and the ever-increasing costs of construction, one prediction we can make is that the cost of safe, clean water and flood protection will not be dropping anytime soon.