What is the Council DOING with BMP 11?

1. What is the Council DOING with BMP 11?

2. Back in Time…. • BMP 11 (Conservation Pricing) has been the same since the MOU was adopted in 1991 • Revision attempted in 1997 but failed • Group 2 has always had strong interest in revising BMP 11 and stressed their priority for it in the Potential BMP section back in 1991 • Committees have met over the years, but • No consensus has ever been reached

3. More Perspective…. • Most signatories do not fully understand what the current BMP 11 says • Applies to Water AND wastewater • Allows all forms of pricing EXCEPT declining block rate structures and flat rates • Uniform rates OK • Seasonal rates OK • Combined volumetric and fixed charge OK

4. Council Activity • Council guidance on designing and implementing conservation rate structures • Rates Handbook • Avoiding Revenue Impact Workshops – October 2004 • Empirical Rates study in Prop 50 application to evaluate price elasticity and savings achieved

5. BMP 11 Reports • Agencies report every two years • Question: % of revenue from volumetric charge • Results are on line • BMP 11 forms recently revised to gather more information

7. Then Along Comes AB 2717…. • Legislature asked the Council to convene a Landscape Task Force • 30 Task Force members, 84 work group members • 43 recommendations, 78 actions • Top 12 voted • #1: Adopt water-conserving rate structures as defined by the Task Force

8. What Did They Mean? Recommendation 38.1: CUWCC should convene a committee no later than January 31, 2006 to determine the appropriate thresholds of the percent of total rates-based revenue that is derived from the fixed versus volumetric portions; work from this committee shall result in adoption of changes to BMP 11 by December 31, 2006.

9. What if it Doesn’t Happen? Recommendation 38.2: If theCUWCC does not adopt a revised BMP 11 by December 31, 2006, the Legislature should revise the Urban Water Management Planning Act to use the Task Force-developed definition of water conserving rate structures as the definition for Conservation pricing in the Demand Management Measures (DMMs) section and require water suppliers to report on their implementation of a conservation rate structure.

10. And What Does THAT Mean? • The Task Force made a recommendation, that’s all • The Council is making a good faith attempt at honoring the request and has a process to follow • Steering and Plenary must approve it by a 2/3 vote of group 1 and 2/3 vote of group 2 • If not voted by both groups it doesn’t pass • But mass panic is ensuing

11. Issues • Are the thresholds appropriate? • Do these thresholds achieve the objectives? • Is there a better approach? • Are there alternative quantifiable solutions? • Will this improve the efficiency of landscape water use? • Are there unintended consequences?

12. Revision PAC Process • Meeting since December 2005 • Expanded voting base • Outreach • Technical Memos • DRAFT Recommendations • Stakeholder Workshops – Oct/Nov 2006 • Steering Committee – Info and Action • Plenary – Info and Action

13. Points to Remember: • The Council only moves forward measures to the Plenary that have the consensus votes to pass • This PAC process is supposed to flush out problems • Does Group 1 really believe that something would be adopted that Group 1 agencies “violently oppose”?

14. So…Would the Legislature Really Take This Up? • Who knows? Why did the Task Force make it their Number #1 recommendation? • Remember: Legislation introduction is not automatic unless a legislator is interested in introducing it • Rates are politically volatile and likely to be controversial • Our best shot is still working together