LAFCO
Santa Clarita Valley Water Agency Municipal Service Review and Sphere of Influence Update.
Read the report at Santa Clarita Valley Agency and Sphere of Influence Update. ↗
Final
Municipal Service Review and
Sphere of Influence Update
Santa Clarita Valley Water Agency
Local Agency Formation Commission
for the
County of Los Angeles
August 12, 2020
E Mulberg & Associates Project Resource Specialists
P.O. Box 582931 P.O. Box 2247
Elk Grove, CA, 95758 Borrego Springs, CA 92004
916.217.8393 760.415.6148
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Table of Contents
Table of Contents
Acronyms ..................................................................................................................................................... iv
Introduction ........................................................................................................................................... 1-1
Purpose of the Municipal Service Review ..................................................................................... 1-1
Sphere of Influence ....................................................................................................................... 1-2
California Environmental Quality Act (CEQA) ............................................................................... 1-3
Uses of the Municipal Service Review .......................................................................................... 1-3
Agency Profile ............................................................................................................................... 1-4
Mutual Water Companies ............................................................................................................. 1-8
Executive Summary ................................................................................................................................ 2-1
Role and Responsibility of LAFCO ................................................................................................. 2-1
Agency Profile ............................................................................................................................... 2-2
Population Projections .................................................................................................................. 2-4
Disadvantaged Unincorporated Communities .............................................................................. 2-4
Present and Planned Capacity of Public Facilities ......................................................................... 2-5
Financial Ability to Provide Service ............................................................................................... 2-6
Status of and Opportunities for Shared Facilities ......................................................................... 2-7
Accountability and Governance .................................................................................................... 2-7
Matters Related to Effective or Efficient Service Delivery, as Required by Commission Policy ... 2-8
Sphere of Influence Considerations ............................................................................................ 2-8
Recommendations .................................................................................................................... 2-10
Population Projections ........................................................................................................................... 3-1
Disadvantaged Unincorporated Communities ...................................................................................... 4-1
Present and Planned Capacity of Public Facilities .................................................................................. 5-1
Supply ............................................................................................................................................ 5-1
Demand ......................................................................................................................................... 5-8
Water Treatment Facilities and Storage ..................................................................................... 5-10
Water Quality .............................................................................................................................. 5-11
Wastewater Collection Services .................................................................................................. 5-12
Solar Power Generation .............................................................................................................. 5-13
Financial Ability to Provide Service ........................................................................................................ 6-1
Revenues and Expenses ................................................................................................................ 6-1
Debt Service .................................................................................................................................. 6-4
Water Rates ................................................................................................................................... 6-5
Capacity Fees ................................................................................................................................. 6-7
Capital Improvements ................................................................................................................... 6-7
Financial Policies and Reserves ................................................................................................... 6-10
Other Post-Employment Benefits ............................................................................................... 6-12
Status and Opportunities for Shared Facilities ...................................................................................... 7-1
Cost Savings through Economies of Scale ..................................................................................... 7-1
Joint Powers Agreements .............................................................................................................. 7-1
Management Efficiencies .............................................................................................................. 7-2
Accountability and Governance ............................................................................................................. 8-1
Devil’s Den Water District (DDWD) ............................................................................................... 8-2
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Table of Contents
Staffing .......................................................................................................................................... 8-4
Communications with Customers ................................................................................................. 8-4
Awards ........................................................................................................................................... 8-4
Matters Related to Effective or Efficient Service Delivery, as Required by Commission Policy ............ 9-1
Sphere of Influence Considerations ................................................................................................... 10-1
Recommendations ............................................................................................................................. 11-1
Future Studies ........................................................................................................................... 11-1
Summary of Determinations .............................................................................................................. 12-1
References ......................................................................................................................................... 13-1
List of Tables
Table 1-1: General Information ................................................................................................................. 1-6
Table 1-2: Mutual Water Companies in SCVWA and Units Served ............................................................ 1-8
Table 3-1: Growth Projections 2020 to 2040 in SCVWA ........................................................................... 3-2
Table 5-1: SWP Table A Supply Reliability (AF) ......................................................................................... 5-2
Table 5-2: Groundwater Availability by Aquifer and Division ................................................................... 5-5
Table 5-3: Summary of Recent and Projected Water Demands of Retail Agencies (AF) .......................... 5-9
Table 5-4: Current and Planned Supply vs Retail Demand (AF) .............................................................. 5-10
Table 5-5: SCVWA Water Treatment Facilities ....................................................................................... 5-10
Table 6-1: Budgeted Revenues and Expenses FY 2018-19 to FY 2020-21 ................................................ 6-1
Table 6-2: Debt Service Projections for the Regional and Retail Divisions ............................................... 6-5
Table 6-3: Water Rates Retail (3/4-inch meter) ........................................................................................ 6-6
Table 6-5: Regional Division Capital Improvement Projects FY 2019-20 - FY 2020-21 Funding Sources . 6-8
Table 6-6: Retail Divisions Capital Improvement Projects FY 2019-20 - FY 2020-21 Funding Sources ..... 6-8
Table 6-7: Cash Reserves June 30, 2020 ................................................................................................. 6-12
Table 6-8: Current OPEB Obligations by Division .................................................................................... 6-13
Table 7-1: Projected Cost Savings ............................................................................................................. 7-1
Table 8-1: SCVWA Board of Directors ....................................................................................................... 8-2
Table 8-2: Historical Number of Employees ............................................................................................. 8-4
List of Exhibits
Exhibit 1-1: Santa Clarita Valley Water Agency Boundary Map ................................................................ 1-5
Exhibit 1-2: Mutual Water Companies in SCVWA ..................................................................................... 1-9
Exhibit 3-1: Population Trends in SCVWA 1996-2015 ............................................................................... 3-1
Exhibit 4-1: SCVWA Disadvantaged Unincorporated Communities (DUC)s ............................................. 4-2
Exhibit 5-1: Alluvial and Saugus Formation Well Location Map ............................................................... 5-7
Exhibit 5-2: Historic Water Use 1980-2016 ............................................................................................... 5-8
Exhibit 5-3: Average Water Use by Source 2007-2016 (AF) ...................................................................... 5-9
Exhibit 6-1: Revenue Sources All Divisions ............................................................................................... 6-2
Exhibit 6-2: Expense Allocation All Divisions ............................................................................................. 6-2
Exhibit 6-3: Allocation of Revenues by Division January 1 - June 30, 2018 .............................................. 6-3
Exhibit 6-4: Allocation of Expenses by Division January 1 -June 30, 2018 ............................................... 6-4
Exhibit 6-5: Facility Capacity Fee Regions ................................................................................................. 6-9
Exhibit 8-1: SCVWA Electoral Division Map .............................................................................................. 8-3
Exhibit 8-2: SCVWA Organizational Chart ................................................................................................. 8-5
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Table of Contents
Exhibit 10-1: Potential Sphere of Influence Areas .................................................................................. 10-2
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Acronyms
Acronyms
ACWA/JPIA Association of California Water Agencies / Joint Powers Insurance Authority
AF acre feet
AFY acre feet per year
BV-RRB Buena Vista Water Storage District/Rosedale-Rio Bravo Water Storage District
BVWSD Buena Vista Water Storage District
CalPERS California Public Employees Retirement System
CCF 100 cubic feet or 748 gallons
CEQA California Environmental Quality Act
CERBT California Employers’ Retiree Benefit Trust
CIP Capital Improvement Plan
City City of Santa Clarita
CKH Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000
CLWA Castaic Lake Water Agency
COP Certificate of Participation
Commission LAFCO
DDW California State Water Resources Control Board Division of Drinking Water
DDWD Devil’s Den Water District
DWR Department of Water Resources
FY Fiscal Year
GSA Groundwater Sustainability Agency
GSP Groundwater Sustainability Plan
GWMP Groundwater Management Plan
Initial Plan Initial Groundwater Operating Plan
IRWMP Integrated Regional Water Management Plan
JPA Joint Powers Authority
LACWWD #36 Los Angeles County Waterworks District No. 36, Val Verde
LA LAFCO Local Agency Formation Commission for the County of Los Angeles
LAFCO Local Agency Formation Commission
MCL Maximum Contaminant Level
mgd million gallons per day
MG million gallons
MHI Median Household Income
MOU Memorandum of Understanding
MSR Municipal Service Review
MW mega watts
NCWD Newhall County Water District
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Acronyms
NWD Newhall Water Division
OPEB Other Post-Employment Benefits
PFAS Per- and polyfluoroalkyl substances
PFOA perfluorooctanoic acid
PFOS perfluorooctanesulfonic acid
ppt parts per trillion
RHF Rolling Hills Farms
RRBWSD Rosedale-Rio Bravo Water Storage District
RWMP Recycled Water Master Plan
SB X7-7 Water Conservation Act of 2009
SB 634 (Wilk) SB 634, Wilk, Santa Clarita Valley Water Agency
SCVWA Santa Clarita Valley Water Agency
SCV Water Santa Clarita Valley Water Agency
SCVWUESP Santa Clarita Valley Water Use Efficiency Strategic Plan
SCWD Santa Clarita Water Division
SGMA Sustainable Groundwater Management Act
SOI Sphere of Influence
SR14 State Route 14
SWP State Water Project
SWRU Stored Water Recovery Unit
UAAL Unfunded Actuarial Accrued Liability
UWMP Urban Water Management Plan
Valley Santa Clarita Valley
VWC Valencia Water Company
VWD Valencia Water Division
WRP Water Reclamation Plant
v
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Introduction
INTRODUCTION
The fundamental role of a Local Agency Formation Commission (LAFCO) is to implement the
Cortese-Knox-Hertzberg (CKH or Act) Local Government Reorganization Act of 2000
(Government Code §56000, et seq.), providing for the logical, efficient, and most appropriate
formation of local municipalities, service areas, and special districts. The CKH requires all
LAFCOs, including the Local Agency Formation Commission for the County of Los Angeles (LA
LAFCO or Commission), to conduct a Municipal Service Review (MSR) when needed or in
advance of revising an agency’s Sphere of Influence (SOI).
Purpose of the Municipal Service Review
Pursuant to CKH (Government Code Section 56430) the Commission (LAFCO) must make a
determination for each of the following seven elements:
1. Growth and population projections for the affected area. This section reviews
projected growth within the existing service boundaries of the district and analyzes
the district’s plans to accommodate future growth.
2. The location and characteristics of any disadvantaged unincorporated
communities within or contiguous to the sphere of influence. A disadvantaged
unincorporated community is defined as one with a median household income of
80% or less of the statewide median income.
3. Present and planned capacity of public facilities and adequacy of public services
including infrastructure needs or deficiencies. This section discusses the services
provided including the quality and the ability of the district to provide those
services, and it will include a discussion of capital improvement projects currently
underway and projects planned for the future where applicable.
4. Financial ability of agencies to provide services. This section reviews the district’s
financial data and rate structure to determine its fiscal viability and ability to meet
service demands. It also addresses funding for capital improvement projects.
5. Status of and opportunities for shared facilities. This section examines efficiencies
in service delivery that could include sharing facilities with other agencies to reduce
costs by avoiding duplication.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Introduction
6. Accountability for community service needs, including government structure and
operational efficiencies. This section examines the district’s current government
structure and considers the overall managerial practices. It also examines how well
the district makes its processes transparent to the public and encourages public
participation.
7. Any other matters related to effective or efficient service delivery, as required by
commission policy. This section includes a discussion of any LA LAFCO policies that
may affect the ability to provide efficient services.
This MSR will provide LA LAFCO with an informational document that analyzes current service
provision by the Santa Clarita Valley Water Agency.
The Santa Clarita Valley Water Agency (SCVWA or Agency or District) was formed by special
legislation, SB 634 (Wilk), signed in 2017. Exhibit 1-1 shows the boundaries of the SCVWA. To
date the Agency has not had a formal MSR. LAFCO has adopted a Municipal Service Review for
the predecessor agencies, the Castaic Lake Water Agency, and the Newhall County Water
District in 2005. CKH requires the MSR to be conducted before, or in conjunction with, its
action to establish or update the SOI for the Agency. Key sources for this study include agency-
specific information gathered through a questionnaire, strategic plans, general plans, websites,
financial reports, agency audits, research, personal communication, and the Municipal Service
Review Guidelines published by the Governor’s Office of Planning and Research.
Sphere of Influence
This report will also include an analysis of the proposed Sphere of Influence (SOI) for the
Agency. There are five determinations that must be made to update the SOI. The Commission
must consider:
1. Present and planned land uses in the area, including agricultural and open space
lands. This consists of a review of current and planned land uses based on planning
documents, including agricultural and open-space lands.
2. Present and probable need for public facilities and services. This includes a review
of the services available in the area and the need for additional services.
3. Present capacity of public facilities and adequacy of public services provided by
the agency. This section includes an analysis of the capacity of public facilities and
the adequacy of public services that the Agency provides or is authorized to provide.
4. Social or economic communities of interest. This section discusses the existence of
any social or economic communities of interest in the area if the Commission
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Introduction
determines that they are relevant to the Agency. These are areas that may be
affected by services provided by the Agency or may be receiving services in the
future.
5. Present and probable need for services to disadvantaged communities. Beginning
July 1, 2012, the Commission must also consider services to disadvantaged
communities which are defined as populated areas within the SOI whose median
household income is less than or equal to 80% of the statewide median income.
California Environmental Quality Act (CEQA)
Actions taken by LAFCO require review under CEQA. Municipal service reviews are exempt from
CEQA pursuant to sections 15306, 15262 and 15061 of the State CEQA Guidelines as data
collection, research, resource evaluation activities or feasibility and planning studies for
possible future action that have not been approved, adopted or funded. The common sense
exemption (section 15061) applies where it can be seen with certainty that there is no
possibility of a significant effect on the environment. In the alternative, the MSR is not a
project for purposes of CEQA because it is an administrative or organizational activity of
government with no direct or indirect effects on the physical environment and is therefore
excluded from the definition of a project, pursuant to section 15378(b) of the State CEQA
Guidelines.
A Sphere of Influence determination is similarly subject to analysis under CEQA. Each area
proposed for an expanded Sphere of Influence is reviewed according to its unique
circumstances and factual information relating to potential environmental impacts. If the
Commission finds that the update results and expanded Sphere of Influence for the Agency, as
described, results in no changes in regulation, no changes in land use, or that no development
will occur as a result of adopting the Sphere, then the update would qualify for the common
sense exemption under CEQA.
Uses of the Municipal Service Review
The MSR is used to study the operations of a local agency, identify agencies unable to perform
their mandated services, or identify ways to provide more effective, efficient services.
Government Code §56375 allows LAFCO to act on recommendations found in the MSR, such as
initiating studies for changes of organization, updating the SOI, or originating a change of
organization or reorganization.
Studies in anticipation of a change of organization are useful to identify potential issues that
may arise during the process. Issues can range from legal barriers to fiscal constraints to
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Introduction
concerns of residents and landowners. A study allows more focused analysis and the
opportunity to resolve issues or options before beginning the process.
The MSR also provides the necessary information to help LAFCO make decisions on the
proposed SOI Update. In evaluating an SOI, the MSR provides the information necessary to
determine if the agency has the capability to serve a larger area. The MSR discusses the
financial condition of the district, source of revenues, and projected expenses. It also includes a
discussion of the projected infrastructure needs that would allow for expansion of those
services.
The MSR can also recommend changes of organization: consolidation, dissolution, merger,
establishment of a subsidiary district, or the creation of a new agency that typically involves a
consolidation of agencies. Those changes of organization may also require an environmental
review, a property tax sharing agreement, and an election.
Agency Profile
The Santa Clarita Valley Water Agency (SCVWA) was formed by special legislation, SB 634
(Wilk), that was passed and signed into law in 2017. As noted in Section 2.5 of SB 634:
“The purpose of the agency is to unify and modernize water resource management
within the Santa Clarita Valley through the efficient, sustainable, and affordable
provision, sale, management, and delivery of surface water, groundwater, and recycled
water for municipal, industrial, domestic, and other purposes at retail and wholesale
within the territory of the agency and to do so in a manner that promotes the
sustainable stewardship of natural resources in the Santa Clarita Valley.”
The legislation consolidated the water purveyors in the Santa Clarita Valley in and around the
City of Santa Clarita and north to Castaic Lake.
The Agency is located in the northwest portion of Los Angeles County about 30 miles north of
the City of Los Angeles where Interstate-5 (I-5) and State Route 14 (SR14) converge. SCVWA
includes approximately 195 square miles or approximately 124,000 acres. The boundaries
generally reflect the boundary of the former CLWA and the former NCWD. Exhibit 1-1 shows
the Agency boundaries.
The Agency services include the sale, management and delivery of surface water, groundwater,
and recycled water for 74,733 connections, serving industrial, residential, and commercial
customers. In addition, the agency also inherited sewer transmission services from the former
NCWD. The Agency is working with the City to transfer those services.
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EXHIBIT 11: SANTA CLARITA VALLEY WATER AGENCY BOUNDARY MAP
/\
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N
Miles
0 2.5 5
Source:. SCVWA 2019c.
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Introduction
Table 1-1 summarizes general information about the Agency which will be elaborated upon in
succeeding sections of this MSR.
Table 1-1: General Information
1. General Information
Agency Santa Clarita Valley Water Agency
Address 27234 Bouquet Canyon Road, Santa Clarita, CA 91350
Principal Act Senate Bill 634 (Wilk)
Date Formed January 1, 2018
Population Approximately 273,000
Services Provided Sale, management and delivery of surface water, groundwater, recycled water,
and sewer transmission in a limited area in the former NCWD
Contact Person Steve Cole, Assistant, General Manager, 661-297-1600
Website www.yourscvwater.com
GOVERNANCE
Board of Directors 12; four from each division and one from LACWWD #36
Compensation $228.15 /day up to 10 days per month
Public Meetings 1st and 3rd Tuesdays at 6:30 pm at 27234 Bouquet Canyon Road
OPERATIONS
Number of Employees 220
Current Service Area 74,733 connections over 195 square miles
Current Facilities Earl Schmidt Filtration Plant and Rio Vista Water Treatment Plant, Saugus Well
No. 1 and 2 perchlorate treatment plant, 47 wells (41 currently operational), 99
storage facilities/tanks, 64 pumping facilities/pump stations, 861 miles of pipe
ranging from 2 – 102-inches in diameter, 141,000 AF banked in Kern County. The
agency also inherited sewer transmission services from NCWD. The Agency is
working with the City of Santa Clarita to transfer those services to the City.
FY 2018-19 FY 2019-20 FY 2020-21
FISCAL TRENDS
Actual ($) Budget ($) Budget ($)
Total Revenues 155,248,521 159,376,669 172,412,505
Total Expenditures 130,551,488 159,376,669 172,412,505
Infrastructure Investment 29,192,488 59,466,158 112,279,056
Debt Outstanding Principal * 389,462,199 364,530,281 346,336,063
Source: SCVWA 2018c, 2019e, f, 2020d. Martin 2020. * Note: Includes principal on VWD acquisition loan.
Many of the agencies that came together to form SCVWA have been serving the area for over
50 years. In 1962, the Legislature created the Upper Santa Clarita Valley Water Agency to
provide State Water Project (SWP) water from the California Aqueduct to the Santa Clarita
Valley. The agency was subsequently renamed Castaic Lake Water Agency. The CLWA was
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Introduction
authorized to deliver wholesale water to agencies that serve water to retail customers. Initially,
four retail water agencies received water from CLWA, two public and two private. The public
agencies were Los Angeles County Waterworks District #36, Val Verde (LACWWD #36 ) and
Newhall County Water District (NCWD). Private agencies included the Santa Clarita Water
Company (SCWC) and the Valencia Water Company (VWC).
The LACWWD #36 was established in 1963 to provide water to retail customers within the Val
Verde Community. LACWWD #36 currently serves a population of 5,200 through 1,350
connections. The LACWWD #36’s water supply is composed of imported water purchased from
SCVWA and groundwater from one well drilled into the Saugus Formation beneath the District’s
Service Area. For most of its existence, the supply in the District was split 50/50 between
imported water and groundwater. More recently, the District has been improving its
groundwater capabilities by adding an additional well, which could ultimately lead to relying
solely on groundwater. While LACWWD #36 will not be the subject of this MSR, a brief review
will be included along with a discussion of future service delivery options within the District.
The NCWD was originally formed on January 13, 1953 as a County Water District. NCWD was
governed by a five-member board elected at large to four-year staggered terms. NCWD
boundaries encompassed approximately 37 square miles in portions of the City of Santa Clarita
and unincorporated Los Angeles County. The NCWD provided potable water to a population of
45,000 with 10,000 connections to Newhall, Canyon Country (Pinetree), Saugus (Tesoro) and
Castaic.
The SCWC was formed in 1973 as the result of a merger between Bouquet Water Company and
Solemint Water Company. In 1999, CLWA acquired the stock of the Santa Clarita Water
Company to provide retail water services as a public agency. It became the Santa Clarita Water
Division (SCWD) of CLWA. SCWD serves a population of approximately 84,000 with 27,500
connections in a 32-square-mile area. The water source is split between imported water from
CLWA and 15 groundwater wells.
The VWC was an investor owned retail water company regulated by the California Public
Utilities Commission. VWC is the largest water retailer in the Santa Clarita Valley, serving a
population of approximately 113,000 with 30,000 connections in Valencia, Stevenson Ranch,
and portions of Newhall, Saugus, and Castaic. Prior to consolidation, VWC customers received
water from two sources, split 50/50 between imported water from CLWA and groundwater
wells.
In addition, SB 634 (Wilk) required SCVWA to "take the appropriate steps to authorize the
dissolution of the Valencia Water Company and the transfer of the company's assets, property,
liabilities, and indebtedness to the agency ..." by January 31, 2018. Consistent with this
requirement, the Agency Board of Directors approved a plan of dissolution of Valencia Water
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Introduction
Company on January 9, 2018, and dissolution formally occurred on January 22, 2018. At that
time, the Agency became the successor to the assets, property, liabilities, and indebtedness of
VWC. The Agency accounts for the revenues, expenses and debt allocated to retail service
within the boundaries of the former VWC through a newly formed Valencia Water Division of
the Agency. As required by the Agency Act, the retail debt of the VWC immediately prior to
dissolution may only be paid from revenues from the Agency's retail Valencia Water Division.
Similarly, SB 634 (Wilk) required that existing debt from SCWD and NCWD be paid from
corresponding retail divisions of the new agency.
Mutual Water Companies
AB 54 (Solorio) was enacted in 2011 and added several requirements and responsibilities to the
management of Mutual Water Companies (MWC) effective January 1, 2012. Corporations Code
§14301.1 requires that each mutual water company submit a map to LAFCO showing its service
area by December 31, 2012. In addition, a mutual must respond to a request for non-
confidential information from a LAFCO in conjunction with preparation of a municipal service
review or Sphere of Influence.
The SCVWA also provides water to 10 mutual water companies. A mutual water company is
defined as “Any private corporation or association organized for the purposes of delivering
water to its stockholders and members at cost, including use of works for conserving, treating
and reclaiming water” (California Public Utilities Code §2725). Table 1-2 lists the mutual water
companies in SCVWA boundaries and the number of customers. The table shows that the
number of units or shareholders ranges from 90 in Ben Shur to 10 in Sutter’s Pointe and Sienna
Ridge. Exhibit 1-2 shows the mutual water company’s location with respect to the Agency’s
boundaries.
Table 1-2: Mutual Water Companies in SCVWA and Units Served
Name Customers (units)
Ben Shur 90
Homeowners 82
New Mint 63
Oak Springs Canyon —serves 17 units 17
Olympic Crest 21
Property Owners 44
Sand Canyon 58
Shangri La 72
Sutter’s Pointe 10
Sienna Ridge 10
Total 467
Source: SCVWA 2019d.
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EXHIBIT 12: M UTUAL WATER COMPANIES IN SCVWA
Legend
Mutuals
PROPERTY OWNERS WATER MUTUAL
BEN SHUR WATER MUTUAL
HOME OWNERS MUTUAL WATER
NEW MINT MUTUAL WATER
OAK SPRING CANYON MUTUAL WATER AREA
OLYMPIC CREST WATER MUTUAL
PROPERTY OWNERS WATER MUTUAL
SAND CANYON OAKS WATER MUTUAL
SHANGRI LA WATER MUTUAL
SIENNA RIDGE WATER MUTUAL
SUTTER POINTE MUTUAL
SUTTERS POINTE MUTUAL
NEW MINT WATER MUTUAL SCVWA BOUNDARY
BEN SHUR WATER MUTUAL
OLYMPIC CREST WATER MUTUAL
SIENNA RIDGE WATER MUTUAL OAK SPRING CANYON WATER MUTUAL
SHANGRI LA WATER MUTUAL
HOME OWNERS MUTUAL WATER
S
C
V
SAND CANYON OAKS WATER MUTUAL -
W
A
T
E
R
B
O
U
D
A
Santa Clarita Valley Water Agency
R
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Y
0 0.25 0.5
Miles
Santa Clarita Valley Water Agency - GIS Team
Location: L:\GIS\Data\Danielle\MXD\SCVWA_Private_Mutuals_2019
This map and associated data are provided without any
warranty of any kind. Any resale of this information is prohibited.
https://www.yourscvwa.com Sources: Esri, HERE, Garmin, Intermap, increment P Corp., GEBCO, USGS, FAO, NPS, NRCAN, GeoBase, IGN, Kadaster NL, Ordnance Survey, Esri Japan, METI, Esri
China (Hong Kong), swisstopo, © OpenStreetMap contributors, and the GIS User Community
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
EXECUTIVE SUMMARY
Role and Responsibility of LAFCO
The fundamental role of a Local Agency Formation Commission (LAFCO) is to implement the
Cortese-Knox-Hertzberg (CKH) Local Government Reorganization Act of 2000 (Government
Code §56000, et seq.), providing for the logical, efficient, and most appropriate formation of
local municipalities, service areas, and special districts. CKH requires all LAFCOs, including LA
LAFCO, to conduct a Municipal Service Review (MSR) prior to updating the Sphere of Influence
(SOI) of the various cities and special districts in the County (Government Code §56430). CKH
requires an MSR and SOI update to be completed periodically.
The focus of this MSR is to provide LA LAFCO with all necessary and relevant information
related to the Santa Clarita Valley Water Agency (SCVWA). It will allow LA LAFCO to make
determinations in each of the seven areas prescribed by CKH. This MSR evaluates the structure
and operation of the Agency and discusses possible areas for improvement and coordination.
The report contains one section for each of the following seven elements as prescribed by CKH:
1. Growth and Population Projections for the Affected Area.
2. The Location and Characteristics of Any Disadvantaged Unincorporated
Communities Within or Contiguous to the Sphere of Influence.
3. Present and Planned Capacity of Public Facilities and Adequacy of Public Services
Including Infrastructure Needs or Deficiencies.
4. Financial Ability of Agencies to Provide Services.
5. Status of and Opportunities for Shared Facilities.
6. Accountability for Community Service Needs, Including Government Structure and
Operational Efficiencies.
7. Any Other Matters Related to Effective or Efficient Service Delivery, as Required by
Commission Policy.
An MSR is used to examine the operations of each local agency, identify agencies unable to
perform their mandated services, or identify ways to provide more effective, efficient services.
Government Code §56375 allows LAFCO to take action on recommendations found in the MSR,
such as initiating studies for changes of organization, updating the SOI, or initiating a change of
organization or reorganization.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
This report also includes SOI recommendations and analysis. CKH requires LAFCO to adopt an
SOI and map for each city and each special district in the County. The Sphere of Influence is
defined by CKH in Government Code §56076 as “a plan for the probable physical boundary and
service area of a local agency or municipality as determined by the Commission.”
The Commission must make determinations with respect to the following five factors when
establishing or reviewing a Sphere of Influence:
1. Present and planned land uses in the area, including agricultural and open space
lands.
2. Present and probable need for public facilities and services.
3. Present capacity of public facilities and adequacy of public services provided by the
agency.
4. Social or economic communities of interest.
5. Present and probable need for services to disadvantaged communities.
An SOI may be amended or updated. An amendment is a relatively limited change to the SOI or
map to accommodate a specific project. An update is a comprehensive review of the Sphere
that includes the map and relevant portions of one or more MSRs. CKH requires updates at
least every five years or as needed.
Agency Profile
The Santa Clarita Valley Water Agency (SCVWA) was formed by special legislation, SB 634
(Wilk), that was passed and signed into law in 2017. The Santa Clarita Valley Water Agency
(SCVWA) was formed by special legislation, SB 634 (Wilk), that was passed and signed into law
in 2017. As noted in Section 2.5 of SB 634:
“The purpose of the agency is to unify and modernize water resource management
within the Santa Clarita Valley through the efficient, sustainable, and affordable
provision, sale, management, and delivery of surface water, groundwater, and recycled
water for municipal, industrial, domestic, and other purposes at retail and wholesale
within the territory of the agency and to do so in a manner that promotes the
sustainable stewardship of natural resources in the Santa Clarita Valley.”
The legislation consolidated the water purveyors in the Santa Clarita Valley in and around the
City of Santa Clarita and north to Castaic Lake.
The Agency is located in the northwest portion of Los Angeles County about 30 miles north of the
City of Los Angeles where Interstate-5 (I-5) and State Route 14 (SR 14) split. SCVWA includes
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
approximately 195 square miles or approximately 124,000 acres. The Agency services include the
sale, management and delivery of surface water, groundwater, and recycled water for 74,733
connections, serving industrial, residential, and commercial customers. Exhibit 1-1 shows the
SCVWA boundaries.
Many of the agencies that came together to form SCVWA have been serving the area for over
50 years. In 1962, the Legislature created the Upper Santa Clarita Valley Water Agency to
provide State Water Project (SWP) water from the California Aqueduct to the Santa Clarita
Valley. The agency was subsequently renamed Castaic Lake Water Agency (CLWA). The CLWA
was authorized to deliver wholesale water to agencies that deliver water to retail customers.
Initially, four retail water agencies received water from CLWA, two public and two private. The
public agencies were Los Angeles County Waterworks District #36 Val Verde (LACWWD #36)
and Newhall County Water District (NCWD). Private agencies included the Santa Clarita Water
Company (SCWC) and the Valencia Water Company (VWC).
The LACWWD #36 was established in 1963 to provide water to retail customers within the Val
Verde Community. LACWWD #36 currently serves a population of 5,200 through 1,350
connections. As shown in Exhibit 1-1, the District is entirely within SCVWA boundaries. The
LACWWD #36’s water supply is composed of imported water purchased from SCVWA and
groundwater from one well drilled into the Saugus Formation beneath the District’s Service
Area. For most of its existence, the water supply in the District was split 50/50 between
imported water and groundwater. More recently, the District has been improving its
groundwater capabilities by adding an additional well, which could ultimately lead to relying
solely on groundwater. While LACWWD #36 will not be the subject of this MSR, a brief review
will be included along with a discussion of future service delivery options within the District.
The SCWC was formed in 1973 as the result of a merger between Bouquet Water Company and
Solemint Water Company. In 1999, CLWA acquired the stock of the SCWC to provide retail
water services as a public agency. SCWC served a population of approximately 84,000 in a 32
square mile area. The water source is split between imported water from CLWA and
groundwater derived from 15 wells.
The NCWD was originally formed on January 13, 1953 as a County Water District. NCWD was
governed by a five-member board elected to four-year staggered terms. NCWD boundaries
encompassed approximately 37 square miles in portions of the City of Santa Clarita and
unincorporated Los Angeles County. The District provided potable water to a population of
45,000 with 10,000 connections to Newhall, Canyon Country (Pinetree), Saugus (Tesoro) and
Castaic.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
The VWC was an investor owned water company regulated by the California Public Utilities
Commission. VWC was the largest water retailer in the Santa Clarita Valley, serving
approximately 113,000 residents in Valencia, Stevenson Ranch, and portions of Newhall,
Saugus, and Castaic. VWC customers receive water from two sources, split 50/50 between
imported water from CLWA and groundwater wells.
SB 634 (Wilk) went into effect on January 1, 2018 and required the Santa Clarita Valley Water
Agency to "take the appropriate steps to authorize the dissolution of the Valencia Water
Company and the transfer of the company's assets, property, liabilities and indebtedness to the
agency ..." by January 31, 2018. Consistent with this requirement, the SCVWA Board of
Directors approved a plan of dissolution of VWC on January 9, 2018, and dissolution formally
occurred on January 22, 2018. At that time, the Agency became the successor to the assets,
property, liabilities, and indebtedness of VWC. The Agency accounts for the revenues,
expenses and debt allocated to retail service within the boundaries of the former VWC through
a newly formed Valencia Water Division of the SCVWA. As required by the Agency Act, the retail
debt of the VWC immediately prior to dissolution may only be paid from revenues from the
Agency's retail Valencia Water Division. Similarly, SB 634 (Wilk) required that existing debt from
SCWD and NCWD be paid from corresponding retail divisions of the new agency.
Population Projections
The 2015 Urban Water Management Plan (UWMP) estimates the current population of the
SCVWA as 273,000. It is estimated there will be a slower growth rate than in recent history of
about 2% per year through 2035. The 2015 UWMP estimates growth in the service area to a
population of 396,100 by 2040.
Disadvantaged Unincorporated Communities
Senate Bill 244 (Wolk) was a significant piece of LAFCO-related legislation passed in 2011. This
bill required LAFCO to make determinations regarding disadvantaged unincorporated
communities or DUCs. They are defined as inhabited, unincorporated territory that constitutes
all or a portion of a community with an annual median household income that is less than 80%
of the statewide annual median household income (MHI).
In 2018, 80% of the statewide median household income was $56,982. There are two DUCs
identified in Exhibit 4-1. One area was identified as a DUC that met the income requirement in
the vicinity of Canyon Country adjacent to the City of Santa Clarita, but within Agency
boundaries. There is a second DUC along the southeast boundary of the Agency. Part of the
area is within SCVWA and the remaining portion is adjacent and beyond the he SOI. Both areas
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
are likely to receive water from SCVWA or from private wells in areas outside the Agency. They
receive fire protection from Los Angeles County Fire Department, and sewer service from
Santa Clarita Valley Sanitation District of Los Angeles County.
Present and Planned Capacity of Public Facilities
The SCVWA is a consolidated agency of four former water purveyors (CLWA, NCWD, VWC, and
the Santa Clarita Water Division). As a wholesale and retail agency, SCVWA supplies come from
State Water Project (SWP) water (wholesale), groundwater, banked water, and recycled water.
SCVWA operates two water treatment plants with a combined capacity of 112 million gallons
per day (mgd) and a separate perchlorate treatment facility for the Saugus Formation wells that
has a capacity of 3 mgd. Combined treated water storage of SCVWA totals approximately 204
million gallons (MG) of water in 99 storage facilities/tanks, which can be gravity fed to Santa
Clarita Valley (Valley) businesses and residences, even if there is a power outage. The system
includes 64 pumping facilities/pump stations in the Santa Clarita Valley, delivering water
through 861 miles of pipe ranging from 2 to 102-inches in diameter.
SCVWA receives wholesale water from the State Department of Water Resources via the State
Aqueduct system under a long-term contract through the Castaic Reservoir. In addition, it has a
contract for raw water with the Buena Vista Water Storage District and the Rosedale-Rio Bravo
Water Storage District for up to 11,000 acre feet per year (AFY) through 2036 which may be
extended.
SCVWA supplies include groundwater from 47 wells in the Alluvial and Saugus Formation. The
47 wells are capable of pumping 77,820 gpm, a maximum capacity of 125,505 AF, 39,040 AF in
a normal year and 58,830 AF in a dry year. Currently 41 wells are operational. Other sources
such as banking, 10,000 AF, recycled water, 450 AF, and imported water, 75,387 AF, provide
nearly another 100,000 AF. Total available supply is approximately 200,000 AF, while demand
increases from 57,000 AF in 2015 to a projected 93,900 AF in 2050. Thus, SCVWA is projected to
have ample capacity.
Wastewater treatment is provided by the Santa Clarita Valley Sanitation District of Los Angeles
County. However, SCVWA does provide wastewater collection services, but no treatment,
within a portion of what was the NCWD. At the time of consolidation, NCWD was in the
process of transferring that responsibility to the City of Santa Clarita (City). The Agency is
continuing to move forward with that process. Currently, SCVWA is working with the Spring
Canyon Development, the City, and the County of Los Angeles to identify improvements
necessary to the existing sewage lift station and force main to allow for transfer to the City.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
SCVWA is also working on completing the transfer of the last section, Sand Canyon Road to the
Vista Canyon, through grant funding.
Financial Ability to Provide Service
The SCVWA adopts a two-year budget and recently adopted a balanced budget for FY 2019-20
and FY 2020-21. The Agency anticipates spending approximately $159 million in FY 2019-20 and
approximately $172 million in FY 2020-21. For FY 2018-19, the Agency anticipates $131 million
in expenses offset by $155 million in revenues.
The Agency has set up its accounting system by division. There is one regional division which
tracks imported water and wholesale customers. There are three retail divisions that serve
residential and commercial customers.
The Agency recently completed its first full year audit of the consolidated agency. The largest
expense is depreciation and amortization. Largest expenses are sources of water supply and the
purchase of water from SWP. Agency-wide interest expense and administration are 12% and
14%, respectively.
Reviewing revenues and expenses for the divisions shows the largest source of revenues for the
Regional Division is property tax, while the largest source for retail divisions is water sales, as
expected. The source of water is a large portion of expenses for all divisions. Also noteworthy
is the share of Valencia and Newhall administrative expenses. The Agency has determined
those costs are due to the way the financial system, used by VWC and NCWD prior to Agency
formation, tracks expenses. The Agency is working to update its financial system which should
resolve the problem.
Total debt of the consolidated agency includes Certificates of Participation (COPs) and Revenue
Bonds and the VWD Acquisition Loan for a total outstanding principal of $389 million as of June
30, 2019. The Agency plans to pay down the debt by approximately $36 million each year over
the next two years.
Water rates were set according to studies completed before consolidation. Ratepayers pay a
base rate plus a commodity charge per one hundred cubic feet or CCF. Each retail agency has a
different rate.
The Agency has a Capital Improvement Plan (CIP). Regional projects are funded by the Capital
Project Fund and property tax revenues. Retail projects are funded by water rates, reserves,
and connection fees. The Agency expects to fund $67.1 million for regional and $45.7 million
for retail divisions totaling $112.8 million.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
SCVWA is guided by its financial policies when developing a budget. Policies include its
Investment Policy, Debt Management Policy, Disclosure Procedure Policy, Derivatives Policy,
Purchasing Policy, Capitalization Policy, Wire Transfer Policy, and Reserve Funds Policy. The
Agency has sufficient reserves for 1,231 days for the Regional Division and 274 days for the
retail divisions.
Prior to the consolidation, NCWD’s past OPEB liabilities were fully funded and held in a trust
(CERBT-California Employers’ Retiree Benefit Trust). CLWA/SCWD past liabilities were also held
in a CERBT trust, but past liabilities were not fully funded. As part of the consolidation,
employee benefits between CLWA and NCWD were aligned and the Agency engaged a
consultant to do an actuarial study to estimate liabilities. In February of 2020, the Agency
made a payment of $5,034,331 so that OPEB is up to date. Each year the budget allocates a
prepayment to keep the total over time up to date.
Status of and Opportunities for Shared Facilities
The Agency projects savings from the previous existing separate agencies of nearly $20 million
by the end of FY 2020-21 due to the consolidation and economies of scale. The Agency
participates in a number of Joint Powers Authorities (JPAs) that allow it to share costs with
other agencies and improve service. They range from the State Water Project Contractors
Authority to the Groundwater Sustainability Agency (GSA) to the Association of California Water
Agencies / Joint Powers Insurance Authority (ACWA/JPIA), which allows the Agency to realize
savings in insurance costs.
Management efficiencies are often measured by whether the Agency has planning activities,
both long range and short range. The Agency has demonstrated management efficiencies by
several planning tools ranging from its two-year budget, Capital Improvement Plan, Asset
Management Plan, and its five-year strategic plan.
Accountability and Governance
The Agency is governed by a 12-member Board of Directors representing its three divisions. The
Board includes one appointed member representing LACWWD #36. The LACWWD #36 seat
expires in 2023 (SB 634 10(c)). Eventually the 12 members will be reduced to nine members,
Membership will be reduced as terms expire, by vacancies, and by eliminating the appointed
position on January 1, 2023. Board members receive $228.15 in compensation for each day of
service for up to 10 days per month.
The SCVWA Board of Directors meetings are held the first and third Tuesdays of each month at
6:30 p.m. Meetings are held at SCVWA headquarters at 27234 Bouquet Canyon Road, Santa
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
Clarita, CA 91350. Meetings are held in accordance with the Brown Act. Board members
receive $228.15 in compensation for each day of service for up to 10 days per month.
In 1988 the CLWA, SCVWA’s predecessor, acquired 90% of the Devil’s Den Water District
(DDWD) as part of the purchase of Producers Cotton Oil Company. CLWA subsequently received
the SWP’s allocation to Devil’s Den Water District. The DDWD is a California Water District and
a landowner voter district. As the landowner of 90% of the District, former CLWA and now
SCVWA directors serve as the governing board for DDWD.
The consolidated Agency initially had a staff of 223 from the four agencies. In its revision of the
FY 2020-21 budget the Board reduced staff to 220.
The Agency maintains a website that provides information to the public on a number of issues
including water conservation, governance, water quality, and the learning center. The Agency
publishes and distributes an e-newsletter (Water Currents). The newsletter is published
monthly and provides residents with information on activities of the Agency.
Matters Related to Effective or Efficient Service Delivery, as Required by
Commission Policy
The Agency’s operations must address LA LAFCO’s approved conditions pertaining to the
formation of the Agency. LA LAFCO adopted 22 conditions. To date, the Agency has complied
with 20 of them. The Agency has been working with LA LAFCO cooperatively on the remaining
conditions.
The LA LAFCO Sphere of Influence for a coterminous sphere applies to SCVWA. The Agency’s
operations are consistent with the Coterminous SOI adopted by the Commission on April 11,
2018. The sole exception is where the Agency provides service to a portion of the former VWC
territory which is outside the Agency’s existing jurisdictional and SOI boundary. SCVWA has
submitted an annexation proposal for the territory to LA LAFCO which will be considered in late
2020 or early 2021. In this regard the Agency is providing effective efficient services, as
required by the Commission’s SOI Policy.
Sphere of Influence Considerations
There are seven potential areas to consider for the SOI. These areas are identified in Exhibit 10-
1 as area A, B, C, D and E as well as Tapia Ranch and Tesoro del Valle developments, Phase A-D.
Area A as shown is a small area that was previously within the jurisdictional boundary of the
former NCWD but outside the jurisdictional boundary of the former CLWA and the current
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
SCVWA. At present there are no services provided to the area. It could be included in the SOI
as a way to complete the consolidation of NCWD.
Area B includes two small discontiguous areas that are islands surrounded entirely by existing
SCVWA jurisdictional territory. The islands are part of a land fill and are undeveloped.
Consequently, SCVWA provides no services to these two islands.
Area C is an area served by VWC that is also outside SCVWA boundaries. The area is located just
west of I-5 off Valencia Boulevard. The area includes 577 parcels on approximately 343 acres. At
build out the development would include 546 single-family homes. One of the LAFCO
conditions pertaining to the formation of the Agency is that the Agency apply for annexation by
January 1, 2020. The application has been submitted, but a Sphere amendment is needed.
Area D is the undeveloped area that appears as an inverted key. Present zoning is residential.
The area can be developed in the future but there are currently no plans to do so.
Area E is territory within the Santa Clarita City limits but not in SCVWA boundaries. There is
one area in the north and two on the southeast border. All the territory is in the Angeles
National Forest and undeveloped.
A sixth area would include the proposed Tapia Ranch subdivision, located approximately 1.5
miles southeast of the Castaic community south of Castaic Lake, approximately 1 mile east of I-
5, and north of the agency boundary. The extent of the proposed subdivision is shown in Exhibit
10-1. The Tapia Ranch site includes approximately 1,167 acres of undeveloped hillside and
canyon land. At build-out the development would include 405 detached single-family homes.
It is likely that the Agency would provide water to the development.
The seventh area is the Tesoro del Valle master-planned community. The development is a
phased development with four phases. Phase A was developed in 2006, and Phase B-D,
sometimes referred to as Tesoro Highlands, has yet to be developed. Tesoro del Valle contains
over 1000 residential units, an elementary school, recreation center, a private park, and the
Tesoro Adobe Historic Park.
Conclusions
Based on this analysis Area A should be included in the Sphere. Including the area in the SCVWA
Sphere would make the consolidation with NCWD whole.
Area B should be included in the SOI because the two islands are surrounded by SCVWA
territory. Although the area is part of a landfill adding the area will make a more logical
boundary.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
Area C should be included because the area is mostly developed and receives services. The area
was served by VWC before the formation of SCVWA. Like Area A, adding the area to the Sphere
would make the inclusion of VWC into SCVWA whole. Since SCVWA has already applied to
LAFCO to annex the territory, inclusion in the Sphere would facilitate the proposed annexation.
Area D should be considered because the land use designation allows it to be developed.
Adding it to the Sphere allows an annexation to create a logical boundary. At present there are
no pending plans to develop this area.
Area E should be included in the SOI since the territory lies within the City of Santa Clarita. All
other territory within the City receives water services from SCVWA. If these areas are ever
developed, they would need water services from the Agency.
Tapia Ranch should be considered for inclusion in the SOI as the landowner proposes to add
405 new dwelling units which would require water services. The Agency has already entered
into a deposit and funding agreement with the owner and has provided a water availability
letter as a step toward potential annexation.
The portion of the Tesoro Highlands that is currently outside the Agency’s boundaries should be
included as it will likely require water service and annexation to SCVWA upon development.
The Agency has already entered into an annexation agreement with the owner.
With the addition of the Tesoro development and inclusion of Area A in the SOI an island of
approximately 85 acres would be created between the two areas. The island, like Area A, is
located in the Angeles National Forest. A closer examination of the terrain of the island shows
that it consists of the ridgeline between Tesoro and Area A. It would be very difficult to
develop that area and provide water service. Since the ridgeline, the island, is zoned National
Forest and because of terrain, it is unlikely to ever require services. Therefore, it is not
recommended to be included in the Sphere.
Recommendations
This section discusses recommendations which do not require Commission action. It is
apparent it will take some time to fully adjust to the consolidation. One area to focus on would
be consolidation of administrative staff. Newhall and Valencia Divisions appear to spend a
larger portion of their budget on administration than the other divisions, as shown in the
Exhibit 6-4. The Agency is aware of this issue and has determined it is due to how those two
divisions record administrative costs. The Agency is in the process of updating its financial
system which when completed in 2021 should result in more consistent assessment of
administrative costs between divisions.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
Future Studies
In the future, it might be useful to do an agency wide rate study so that residents in one
division do not pay different rates than another division. The rate study should identify cost of
service principles to ensure fair rate allocation for all customers.
The addition of a rate payer advocate is a good addition to lend the voice of ratepayers to
deliberations on new rates. However, it is unclear how the rate payer advocate would
communicate with rate payers to provide and receive input on rates. The Agency might
consider a citizens advisory committee to work with the rate payer advocate. A citizens
advisory committee could result in more communication with rate payers, enhanced
transparency, and greater acceptance of the rate setting process.
The Agency should consider reviewing its position with respect to the Devil’s Den Water
District. DDWD appears to be primarily in an agricultural use and potentially uninhabited by
CKH standards. One of the concerns is the distance between the DDWD and SCVWA. As part of
the analysis provided in this MSR, Kings LAFCO and Kern LAFCO were contacted for information
about DDWD. Very little data was available so it might be useful to request an update to the
DDWD MSR by Kings and/or Kern LAFCO to shed light on the operation of that district. This
would allow SCVWA and LAFCO to determine the best way to serve that area.
The Agency may also want to consider a consolidation with LACWWD #36. There are several
reasons that a consolidation makes sense:
LACWWD #36 and SCVWA are both capable of providing retail water services.
LACWWD #36 is fully contained in the 3rd electoral division so its residents can vote for a
representative on the SCVWA Board of Directors.
SCVWA has ample water supply to serve LACWWD #36.
However, Section 4(i) of SB 634 (Wilk), also states that the two agencies may only be
consolidated upon mutual consent. In addition, SB 634 (Wilk) states that the consolidation
must go through LAFCO.
The 10 mutual water companies identified in Exhibit 1-2 are non-profit corporations that
provide potable water to their shareholders. All 10 are within the Agency’s boundaries. They
receive wholesale water from the Agency, which they then sell to their shareholders. As private
companies, much of their financial information is not readily available. It is difficult to assess
their ability to provide services. The assumption is that they are providing adequate services.
Therefore, it is not recommended to transfer the provision of potable water services unless the
mutual company or its shareholders request SCVWA to provide the service.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
POPULATION PROJECTIONS
Exhibit 3-1 shows the population for each retail purveyor within the boundaries of the SCVWA,
and the population of the total service area. Exhibit 3-1 also shows population trends for the
20-year period from 1996 to 2015. Between 1996 and 2015 the total population increased from
164,000 to 273,000. The exhibit shows a steady increase in population at an average rate of
2.7% per year. Most of the growth occurred in the SCWD which increased about 50% and the
VWC which nearly doubled in population.
Exhibit 3-1: Population Trends in SCVWA 1996-2015
300,000
250,000
200,000
150,000
100,000
50,000
0
Source: Kennedy/Jenks Consultants 2017.
Table 3-1 shows population projections for the next 20 years or through 2040 based on the
2015 Urban Water Management Plan (UWMP). The UWMP projects the population to be
slightly higher in 2020 than estimated by the Agency. It is estimated there will be a slower
growth rate than in recent history of about 2% per year through 2035. Thereafter, the
projections show slower growth. The 2015 UWMP indicates a 1.3% annual rate of growth in the
service area.
3-1
noitalupoP
Year
NCWD SCWD VWC LACWWD #36 Total
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Population Projections
Table 3-1: Growth Projections 2020 to 2040 in SCVWA
LACWWD Total CLWA
Year NCWD SCWD VWC #36 Service Area
2020 49,000 131,500 99,600 9,000 289,100
2025 52,200 139,200 119,700 10,800 321,900
2030 55,500 146,800 139,800 12,500 354,600
2035 58,800 154,500 155,900 14,300 383,500
2040 62,000 162,200 155,900 16,000 396,100
Source: Kennedy/Jenks Consultants 2017.
Determinations
Current population of the Agency is estimated at 273,000.
It is estimated there will be a slower growth rate than in recent history of about 2% per
year through 2035. The 2015 UWMP estimates growth in the service area to a population
of 396,100 by 2040.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Disadvantage Unincorporated Communities
DISADVANTAGED UNINCORPORATED COMMUNITIES
Senate Bill 244 (Wolk) was a significant piece of LAFCO-related legislation passed in 2011. This
bill required LAFCO to make determinations regarding disadvantaged unincorporated
communities or DUCs. They are defined as inhabited, unincorporated territory that constitutes
all or a portion of a community with an annual median household income (MHI) that is less than
80% of the statewide Annual Household Income.
In 2018, 80% of the statewide median household income was $56,982. One area was identified
as a DUC that met the income requirement in the vicinity of Canyon Country adjacent to the
City of Santa Clarita (Exhibit 4-1). The area is actually within the SCVWA boundary and receives
water services from SCVWA. It receives fire protection from Los Angeles County Fire
Department, and sewer service from Santa Clarita Valley Sanitation District of Los Angeles
County.
Exhibit 4-1 shows a second larger DUC along the southeast boundary of the Agency extending
beyond the boundary around the community of Newhall. The area would also likely receive
water from SCVWA or from private wells in areas outside the Agency. They receive fire
protection from Los Angeles County Fire Department, and sewer service from Santa Clarita
Valley Sanitation District of Los Angeles County. Since the Agency at present has a coterminous
sphere that DUC lies adjacent to the SCVWA Sphere of Influence.
Determination
In 2018, 80% of the statewide annual median household income was $56,982. There are two
DUCs identified in Exhibit 4-1. One area was identified as a DUC that met the income
requirement in the vicinity of Canyon Country adjacent to the City of Santa Clarita, but within
Agency boundaries. There is a second DUC along the southeast boundary of the Agency. Part
of the area is within SCVWA and the remaining portion is adjacent and beyond the he SOI.
Both areas are likely to receive water from SCVWA or from private wells in areas outside the
Agency. They receive fire protection from Los Angeles County Fire Department, and sewer
service from Santa Clarita Valley Sanitation District of Los Angeles County.
4-1
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Legend Santa Clarita Valley Water Agency
DUCs - Less than $56,982 14
or 80% of Median Household (A Consolidation of the former Castaic Lake Water Agency and Newhall County Water District,
Income pursuant to State approval of SB 634, effective January 1, 2018).
Santa Clarita Valley Water
Agency
1 in = 2.6 miles
Santa Clarita Valley Water Sphere of Influence History
Agency, Sphere of Influence Action Effective Date
0 1.5 3 6
(SOI), Coterminous
Adopted 04-11-18
Miles
Revised: April 10, 2019 C:\GIS\MXDs\SCVWA
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
PRESENT AND PLANNED CAPACITY OF PUBLIC FACILITIES
SCVWA is both a water wholesaler and retail provider. The Agency receives wholesale water
from the State Water Project Water (SWP) administered by its Regional Division. Water is
stored at its 99 storage facilities then sent to one of its two treatment facilities before being
conveyed to its retail divisions for distribution. The distribution system includes 861 miles of
pipe, 64 pump stations, and the storage facilities. The Agency also has other sources that
includes two banking facilities in Kern County, 47 groundwater wells (41 currently operational),
and recycled water. This section will describe supply sources and demand as well as capacities
of its facilities.
Supply
Prior to 1980, local groundwater extracted from the Alluvium and the Saugus Formation was
the sole source of water supply in the Santa Clarita Valley. Since 1980, local groundwater
supplies have been supplemented with imported State Water Project (SWP) water supplies,
augmented, in 2007, by acquisition of additional supplemental water imported from the Buena
Vista Water Storage District (BVWSD), Rosedale-Rio Bravo Water Storage District (RRWSD),
collectively referred to as BV-RRB, and in 2008, Yuba Accord Water. Those water supplies have
also been slightly augmented by deliveries from the recycled water program since 2003.
SCVWA obtains the majority of its imported water supplies from the SWP, which is owned and
operated by DWR. SCVWA is one of 29 contractors holding long-term SWP contracts with DWR.
SWP water originates as rainfall and snowmelt in the Sacramento and Feather River watersheds
where the SWP’s largest reservoir, Lake Oroville, is located. The water released from Lake
Oroville flows down the Feather River, joins the Sacramento River, and enters the Sacramento-
San Joaquin Delta. Water is diverted from the Delta into the Clifton Court Forebay, and then
pumped into the 444-mile long California Aqueduct. A portion of SWP water delivered to
Southern California may temporarily be stored in San Luis Reservoir, which is jointly operated
by DWR and the U.S. Bureau of Reclamation. Prior to delivery to SCVWA, SWP supplies are
stored in Castaic Lake, a terminal reservoir located at the end of the West Branch of the
California Aqueduct in the northwest portion of the Agency.
SCVWA derives its supply from several sources. Primary sources are contract water from the
SWP, often referred to as “Table A”, and groundwater, augmented by banked water and local
recycled water.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
Contract Water (Wholesale)
SCVWA has a contractual agreement with the State Water Project (SWP) for 95,200 AFY.
Contract water is often a percentage of the current year’s allocation plus carryover from the
preceding year augmented by supplemental water from BV- RRB. The total contract water
(Table A water) is not always available in one given year. For example, in 2018 SCVWA received
35% or 33,200 AF of its 2018 Table A water, 42,788 AF of SWP carryover from 2017 and 11,000
AF from BVWSD and RRWSD. SCVWA’s total supply in 2018 was 87,108 AF. The disposition of
water by SCVWA in 2018 to various sub-entities included delivery to the water divisions of
SCVWA and to LACWWD #36, which received 41,999 AF. Some water went to the Kern County
Water Agency which consists of 13 districts called member units. Kern County Water Agency’s
westside member units received 5,000 AF in 2018. Devil’s Den Water District, although not a
member unit of the Kern County Water Agency, received 62 AF and 836 AF was accounted for
as water loss. Part of the 836 AF, 386 AF, was used by the Rio Vista Treatment Plant’s
conservation garden and the remainder from meter reading differences. The remaining 39,211
AF were carried over in SWP storage for potential use in 2019 and future years. Carryover
supply has been available each year for the past 10 years.
Wholesale Supply Reliability
Wholesale water supply reliability is a key priority for the SCVWA for both normal and drought
weather conditions. As described in the 2015 UWMP, SCVWA plans to meet its water demands
for wholesale and retail, potable water, for the next planning period through 2050 as shown in
Table 5-1.
Table 5-1: SWP Table A Supply Reliability (AF)
Wholesaler (Supply Source) 2015 2020 2025 2030 2035-2050
Average Water Year
Table A Supply 59,000 58,800 58,500 58,300 58,100
% of Table A Amount 62% 62% 61% 61% 61%
Single-Dry Year
Historic Worst Case 1977 10,500 9,800 9,000 8,300 7,600
% of Table A Amount 11% 10% 9% 9% 8%
Worst Case Actual Allocation 2014 4,800 4,800 4,800 4,800 4,800
% of Table A Amount 5% 5% 5% 5% 5%
Multiple-Dry Year
Four-Year Period 31,400 31,400 31,400 31,400 31,400
% of Table A Amount 33% 33% 33% 33% 33%
Three-Year Period 20,000 19,800 19,500 19,300 19,000
% of Table A Amount 21% 21% 20% 20% 20%
Source: Kennedy/Jenks Consultants 2017.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
5.1.3 Banking
Other components of SCVWA’s imported water supply reliability program include its banking
agreements with Semitropic Water Storage District in Kern County. Originally composed of
two agreements with Semitropic, SCVWA banked 24,000 AF surplus Table A water in 2002 and
32,522 AF in 2003. After a 10% transmission loss, the total amount banked was 50,870. The
first withdrawal of 4,950 AF occurred in 2009 from the 2002 account. Of the 4,950 AF
withdrawn, 1,650 AF was delivered for water supply in the Valley in 2009, and the 3,300 AF
balance was delivered in 2010. An additional 4,950 AF of water was withdrawn from Semitropic
in 2014, with another 5,000 given to Newhall Land for SCVWA’s use of their first priority
extraction capacity. Semitropic had recently expanded its groundwater banking program to
incorporate its Stored Water Recovery Unit (SWRU).
In 2015, CLWA entered into another agreement with Semitropic to participate in the SWRU as
an additional source of dry-year supply. Under this agreement, the 2002 and 2003 accounts
containing 35,970 AF were transferred into this new program. Under the SWRU agreement,
SCVWA can store and recover additional water within a 15,000 AF storage account. The term of
the Semitropic Banking Program extends through 2035 with the option of a 10-year renewal. In
2017, 5,340 AF were delivered to storage and after a 10% transmission loss, 4,806 AF were
banked. The recoverable balance in this account at the end of 2018 stands at 40,776 AF.
In 2005, SCVWA completed an agreement to participate in a long-term water banking program
with RRBWSD. This long-term program allows storage of up to 100,000 AF at any one time and
will be in place through the accumulation and recovery of 200,000 AF total. Since that time,
with several deliveries of excess water and withdrawals, approximately 100,000 AF remain in
storage at the end of 2018.
5.1.4 Recycled Water
Recycled water is currently produced at two water reclamation plants (WRP)s operated by the
Santa Clarita Valley Sanitation District of Los Angeles County (SCVSD), the Valencia WRP and the
Saugus WRP, with average annual production of 15,500 AFY and 6,100 AFY, respectively. Most
of the treated effluent from these two plants is discharged to the Santa Clara River. As of 2018,
there was pending legal action whether these discharges to the Santa Clara River are sufficient
to maintain instream flow requirements for the protection of biological resources.
SCVWA is working with SCVSD and other area stakeholders on the best path forward to expand
the Valley’s recycled water resources. In addition, Vista Canyon Water Factory was anticipated
to come online in 2019 and eventually produce up to 440 AFY of recycled water use for new
and existing users in the SCWD service area. The proposed Newhall Ranch WRP is anticipated to
5-3
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
produce 4,200 AFY at buildout (2035 or later), meeting more than half of the anticipated non-
potable demands for the new development.
An update to the 2002 Recycled Water Master Plan (RWMP) was conducted in 2016. The
updated RWMP included near-term, mid-term, and long-term objectives for increasing the use
of recycled water where it was economically feasible. The previous and current master plans
considered various factors affecting recycled water sources, supplies, users and demands that
would allow CLWA to develop a cost-effective recycled water system within its service area. The
2016 update remains a draft pending completion of a CEQA document.
5.1.5 Groundwater
The groundwater basin beneath the Santa Clarita Valley, identified in the DWR’s interim update
to Bulletin 118 as the Santa Clara River Valley Groundwater Basin, East Sub-basin (Basin No.
4-4.07), comprised of two aquifers, the Alluvium and Saugus Formation. The Alluvium generally
underlies the Santa Clara River and its several tributaries, and the Saugus Formation underlies
practically the entire Upper Santa Clara River area. The mapped extent of the Santa Clara River
Valley East Groundwater Sub-basin in DWR Bulletin 118 and its relationship to the extent of the
SCVWA service area are illustrated in Exhibit 5-1. The Exhibit shows groundwater wells and that
the mapped sub-basin boundary approximately coincides with the outer extent of the Alluvium
and Saugus Formation.
Since 1986, there have been several efforts which have evaluated and reported on the Alluvium
and Saugus Formations, interpreted hydrologic conditions, and estimated sustainable yields
from both formations. Generally, these investigations have similar conclusions for basin
conditions and yield:
The operational yield of the Alluvium would typically be 30,000 to 40,000 AFY for wet and
normal rainfall years, with an expected reduction to 30,000 to 35,000 AFY in dry years.
The operational yield of the Saugus Formation would typically be in the range of 7,500 to
15,000 AFY on a long-term basis, with possible short-term increases during dry periods into
a range of 15,000 to 25,000 AFY, and to 35,000 AFY if dry conditions continue requiring
additional local source supplies.
These conclusions became the foundation of the Initial Groundwater Operating Plan (Initial
Plan) first developed in 2004 after the adoption of a formal Groundwater Management
Plan (GWMP) in 2003. The Initial Plan was updated in 2008 to evaluate the yield of the
basin and present a sustainable operating plan for using groundwater resources from the
Alluvium and the Saugus Formation for a normal year and a dry year. They are
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
summarized in Exhibit 5-1. The updated basin yield analysis completed in August 2009, had
the following conclusions:
The Current Operating Plan, with currently envisioned pumping rates and distribution,
comparable to the Initial Plan described above, will not cause detrimental short- term or
long-term effects to the groundwater and surface water resources in the Valley and is,
therefore, sustainable. Further, local conditions in the Alluvium in the eastern end of the
basin can be expected to repeat historical groundwater level declines during dry periods,
necessitating a reduction in desired pumping from the Alluvium due to decreased well
yield. However, those reductions in pumping from the Alluvium
Table 5-2: Groundwater Availability by Aquifer and Division
Pump Capacity Max Capacity Normal Year Dry Year
Aquifer/Division Number of Wells (GPM) (AF) (AF) (AF)
Alluvial
NCWD 8 4,620 7,400 1,950 1,250
SCWD 14 14,650 23,780 11,050 8,300
VWC 15 22,650 36,470 12,850 12,850
Total 37 41,920 67,650 25,850 22,400
Saugus
NCWD 2 4,650 7,500 3,525 4,975
SCWD 2 19,050 30,700 8,245 19,865
VWC 5 10,200 16,435 920 11,090
LACWWD36 1 2,000 3,220 500 500
Total 10 35,900 57,855 13,190 36,430
All 47 77,820 125,505 39,040 58,830
Source: Kennedy/Jenks Consultants 2017.
can be made up by an equivalent amount of increased pumping on a short-term basis in
other parts of the basin without disrupting basin-wide sustainability or local pumping
capacity in those other areas. For the Saugus Formation, the modeling analysis indicated
that it could sustain the pumping that is embedded in the Current Operating Plan.
o A Potential Operating Plan (pumping between 41,500 and 47,500 AFY from the
Alluvium) would result in lower groundwater levels, due to failure of the basin to fully
recover during wet cycles from depressed storage that would occur during dry periods.
o Long-term lowering of groundwater levels would also occur in the Saugus Formation
(pumping between approximately 16,000 and nearly 40,000 AFY) with only partial water
level recovery occurring in the Saugus Formation. Thus, the Potential Operating Plan
would not be sustainable over a long-term period.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
o Several climate change models were examined to estimate the potential impacts
on local hydrology in the Santa Clarita Valley. The range of potential impacts
extends from a possible wet trend to a possible dry trend over the long term from
2010 through 2095. Notable in the wide range of possibilities, however, was the
output that, over the planning horizon of the 2010 and 2015 UWMP (through
2050), the range of relatively wet to relatively dry hydrologic conditions would be
expected to produce sustainable groundwater conditions under the Current
Operating Plan. Based on the preceding conclusions, groundwater utilization
generally has continued in accordance with the Current Operating Plan; and the
Potential Operating Plan is not being considered for implementation.
Groundwater Recharge
One of the types of water reuse that was considered in the updated RWMP is groundwater
replenishment, which represents an opportunity to recharge the underlying aquifer. Two
recharge feasibility studies were recently completed for the Agency as it advances efforts to
utilize recycled water. These studies looked to evaluate the maximum potential recharge with a
source of approximately 5,000 AFY of recycled water from Valencia WRP. The first study looked
at a recharge area in the northwest portion of the sub-basin near Castaic Lake and
recommended further geotechnical, geochemical, and modeling analysis of the proposed site.
The initial analysis concluded that the retention time of recharged recycled water was less than
the regulatory requirements. The second study was conducted in the eastern part of the sub-
basin and recommended pilot studies at the proposed recharge sites to improve hydrogeologic
understanding and evaluation of additional sources of diluent.
Sustainable Groundwater Management Act (SGMA)
In May 2017, the Santa Clarita Valley Groundwater Sustainability Agency (SCV-GSA) was formed
by a Memorandum of Understanding (MOU) including the SCVWA, City of Santa Clarita,
LACWWD #36, and the County of Los Angeles. In 2018, the SCVWA entered into an
administrative agreement to manage the affairs of the Agency. A Board of Directors of seven
members and alternates meets quarterly or as needed to conduct activities of the Agency.
More detailed information is available on the SCV-GSA website at www.SCV-GSA.org.
To date, the SCV-GSA has begun extensive public outreach and begun the necessary SGMA
studies to evaluate the applicability of a Groundwater Sustainability Plan (GSP). Stakeholder
Groups have been identified and an Advisory Committee is being formed to provide review and
input for the planning process. A final GSP is due for submittal to DWR by early 2022.
5-6
EXHIBIT5-1: ALLUVIAL AND SAUGUS FORMATION WELL LOCATION MAP
Source: Kennedy/Jenks Consultants. 2017
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
Demand
Historically, demand has increased as the population increased. Exhibit 5-2 shows water use,
demand, for the period 1980 through 2016. It also shows the demand by retail division, SCWD,
LACWWD #36, NCWD and VWC as well as the total for all agencies. Although not part of
SCVWA, LACWWD #36 receives wholesale water from the former CLWA. This exhibit shows the
highest demand comes from CLWA’s SCWD and VWC.
Demand over the last 10-years averaged 67, 586 AFY. Exhibit 5-3 shows the average amount
drawn from wholesale or regional water from the SWP, groundwater, which includes the
Alluvium wells and the Saugus Formation wells, and recycled water. Imported water represents
52% on average of the water used while ground water from the Alluvium aquifer represents
34% on average of water used. As shown, recycled water is about 1% on average.
Exhibit 5-2: Historic Water Use 1980-2016
90,000
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
Source: SCVWA 2018a.
5-8
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Year
SCWD LACWWD #36 NCWD VWC All
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
Exhibit 5-3: Average Water Use by Source 2007-2016 (AF)
Saugus Recycled Water
Formation 1%
9%
Alluvium
Groundwater Imported Water
34% 52%
Treated
Groundwater
4%
Source: SCVWA 2018a.
Retail demand with conservation and conservation through changes to the plumbing code are
shown in Table 5-3. The conservation measures included in the table would satisfy Senate Bill
X7-7 (SB X7-7) requirements. SB X7-7 requires water agencies to develop a plan to achieve a
twenty percent per capita water use reduction by the year 2020.
Table 5-3: Summary of Recent and Projected Water Demands of Retail Agencies (AF)
Agency 2015 2020 2025 2030 2035 2040 2045 2050
LACWWD #36 976 2,300 2,700 3,100 3,500 3,900 4,300 4,700
NCWD 8,100 10,100 10,700 11,200 11,800 12,600 13,400 14,200
SCWD 21,783 28,400 29,100 29,900 30,800 32,400 33,900 36,000
VWC 23,642 28,100 32,100 36,600 40,000 39,600 39,300 39,000
Total Demand 57,966 68,900 74,600 80,800 86,100 88,500 90,900 93,900
Source: Kennedy/Jenks Consultants 2017.
Future wholesale water demand assumes the contract amounts from the SWP of 95,200 AF and
from Buena Vista Water Storage District/ Rosedale-Rio Bravo Water Storage District of 11,000
AF.
Table 5-4 compares current and planned supply versus demand. The data indicate SCVWA has
sufficient water from several sources and the capacity to accommodate growth. It also can
provide water to LACWWD #36.
5-9
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
Table 5-4: Current and Planned Supply vs Retail Demand (AF)
2015 2020 2025 2030 2035 2040 2050
Existing Supplies
Total Groundwater 31,545 31,545 31,545 31,545 31,545 31,545 31,545
Total Recycled 450 450 450 450 450 450 450
Total Imported 78,667 78,467 78,167 75,587 75,387 75,387 75,387
Total Bank 22,950 22,950 12,950 12,950 12,950 12,950 7,950
Total Existing Supplies 134,412 133,412 123,112 120,532 120,332 120,332 115,332
Planned Supplies
Total Groundwater - 5,230 7,230 8,230 10,230 10,230 10,230
Total Recycled - 565 5,156 7,627 9,604 9,604 9,604
Total Banking - 7,000 7,000 17,000 17,000 17,000 22,000
Total Planned Supplies - 12,795 19,386 32,857 36,834 36,834 41,834
Total Supply 134,412 159,002 161,884 186,246 194,000 194,000 199,000
Total Demand 57,966 68,900 74,600 80,800 86,100 88,500 93,900
Source: Kennedy/Jenks Consultants 2017.
Water Treatment Facilities and Storage
Water from the SWP and other sources located outside the Valley is treated, filtered, and
disinfected at SCVWA’s Earl Schmidt Filtration Plant and Rio Vista Water Treatment Plant, which
have a combined treatment capacity of 125 million gallons per day, Table 5-5. Also included in
the table is information for the Saugus Formation Well No. 1 and 2 perchlorate treatment plant.
This water is delivered from the treatment plants to each of the water divisions and LACWWD
#36 through a distribution network of pipelines and 26 water turnouts.
Table 5-5: SCVWA Water Treatment Facilities
Earl Schmidt Rio Vista Water Saugus Perchlorate
Filtration Plant Treatment Plant Treatment Plant
Location 32700 Lake Hughes Road, 27234 Bouquet Canyon Road, 26407 Bouquet Canyon
Castaic, CA Santa Clarita, CA Road, Santa Clarita, CA
Age (years) 37 22 7
Capacity (mgd) 56 66 3
Type of treatment Ozonation, rapid mix, Ozonation, rapid mix, contact Ion-Exchange
contact clarification, clarification, filtration and
filtration and chloramination
chloramination
Source: SCVWA 2018a.
Combined treated water storage of SCVWA totals approximately 204 MG of water in 99 storage
facilities/tanks, which can be gravity fed to Valley businesses and residences, even if there is a
power outage. The system includes 64 pumping facilities/pump stations delivering water
through 861 miles of pipe ranging from 2 to 102-inches in diameter.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
In the event of a power outage or system failure, the public would be asked to reduce
consumption to minimum health and safety levels, extending the available supply to a
minimum of seven days. This would provide sufficient time to restore a significant amount of
local groundwater production. After the groundwater supply is restored, the pumping capacity
could meet the reduced demand until the imported water supply was reestablished. The overall
system is designed to allow for isolation of major sectors and to distribute water through
redundant pipelines and pump stations from wells.
Water Quality
In 1998, the EPA began requiring community water systems to provide their customers annual
consumer confidence reports on water quality to comply with the Safe Drinking Water Act. As
required, the Agency publishes an annual Consumer Confidence Report in English and Spanish.
The Agency’s annual report provides information about the water requirements and water
supplies. The 2019 Water Quality Report was prepared for the imported water wholesaler, and
the four local retail purveyors, Santa Clarita Water Division, LACWWD #36, NCWD, and VWC.
Over the last couple of years, the Agency has received violation notices and has responded to
them. SCVWA received a violation from the Los Angeles Regional Water Quality Control Board
for exceeding discharge limitations from Well V201. The violations were associated with Basin
Objective limits. SCVWA resolved the discharge issues by blending the discharge water and paid
the fine.
In 2018, the nitrate results for Well W9 exceeded half the maximum contaminant level (MCL)
for Nitrate. This exceedance triggered quarterly monitoring for nitrate. SCVWA neglected to
begin the quarterly monitoring. The California State Water Resources Control Board Division of
Drinking Water (DDW) issued a Tier 3 violation. This violation is a monitoring violation and
requires SCVWA to note this in the annual Consumer Confidence Report.
In 2018, the Rio Vista Treatment Plant had a Certified Unified Program Agency inspection where
a few violations were noted. There are no pending violations.
A known perchlorate plume was detected in several wells. Perchlorate is an inorganic chemical
used in solid rocket fuel, fireworks, explosives, and a variety of industries. It gets into drinking
water from historic industrial operations that used, stored, or disposed of the material. In 2007,
the DDW adopted an MCL of 6 micrograms/liter. DDW issued an amendment to SCVWA
Regional Division’s Domestic Water Supply Permit on December 30, 2010, authorizing the use
of a perchlorate treatment facility. On January 25, 2011, the SCVWA Regional Division
introduced the treated water from the treatment facility into the distribution system in
compliance with the amended water supply permit.
5-11
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
Per- and polyfluoroalkyl substances (PFAS) are a group of manmade chemicals that are
prevalent in the environment and were commonly used in industrial and consumer products to
repel grease, moisture, oil, water, and stains. Water agencies do not put these chemicals into
the water, but over time very small amounts enter the water supplies through manufacturing,
wastewater discharge, and product use. Exposure to these chemicals may cause adverse health
effects. On February 6, 2020, DDW lowered its response levels to 10 parts per trillion (ppt) for
perfluorooctanoic acid (PFOA) and 40 ppt for perfluorooctanesulfonic acid (PFOS), two
chemicals in a family of per- and polyfluoroalkyl substances (PFAS). The state’s previous
response level set a combined 70 ppt for PFOA and PFOS. In addition to revised response levels,
DDW has indicated it will issue a new compliance sampling order in the near future. The revised
response level guidelines will be compared to a quarterly running annual average of sample
results.
In August of 2019, SCVWA sampled all wells in the system. One well was immediately removed
from service when it exceeded the original response level. Other wells that are found to exceed
the revised response level will also be removed from service. Under the new guidelines, as
many as 18 of the 41 operational wells could be impacted. The first PFAS treatment facility has
started construction and is expected to be in operation by July of 2020, restoring three key
wells to service, representing a significant amount of the affected groundwater. The fast-
tracked project is estimated to cost $6 million to build and $600,000 annually to operate.
Wastewater Collection Services
Wastewater treatment is provided by the Santa Clarita Valley Sanitation District of Los Angeles
County. However, SCVWA does provide wastewater collection services, but no treatment,
within a portion of what was the NCWD. Specifically, these facilities include a sewage lift
station, force, and transmission mains. SCVWA is continuing to move forward with the goal to
transfer the responsibilities for wastewater collection services to the City Santa Clarita.
NCWD had made significant progress towards this goal through the transfer of several
thousand feet of transmission main to the City over the past 5 years. This included a significant
stretch along Soledad Canyon Road and another stretch associated with the realignment of the
transmission main as part of the Vista Canyon Project.
Currently, SCVWA is working with the Spring Canyon Development, the City of Santa Clarita,
and the County of Los Angeles to identify improvements necessary to the existing sewage lift
station and force main to allow for transfer to the City. These improvements are planned to be
completed by the Spring Canyon Development as it constructs its facilities. That will then leave
a portion of transmission main needed from Sand Canyon Road to the Vista Canyon
5-12
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Present and Planned Capacity of Public Facilities
Development. Preliminary design has been completed for this section. SCVWA is pursuing grant
funding to complete the project.
Solar Power Generation
SCV Water currently operates solar power generation systems. A small scale system is located
at the former NCWD administration building. Two large scale systems are located on the Rio
Vista Water Treatment Facility property. The two systems, one on the middle Mesa behind the
Maintenance Building and one on the upper Mesa, function as a single project through a
purchase power agreement and have a combined design capacity of 4.5 Mega Watts total.
These facilities provide low cost energy and offset energy costs.
Determinations
As a wholesale and retail agency, SCVWA supplies come from SWP water (wholesale),
groundwater, banked water, and recycled water.
SCVWA operates two water treatment plants with a combined capacity of 112 mgd and a
separate perchlorate treatment facility for Saugus Formation wells that has a capacity of 3
mgd. PFAS have been detected in the well system. There is a possibility that 18 wells may
have PFAS that will require a response. SCVWA is in the process of building a treatment
facility for PFAS that is scheduled for completion in July of 2020.
Combined treated water storage of SCVWA totals approximately 204 mg of water in 99
storage facilities/tanks, which can be gravity fed to Valley businesses and residences, even
if there is a power outage. The system includes 64 pumping facilities/pump stations
delivering water through 861 miles of pipe ranging from 2 to 102-inches in diameter.
SCVWA receives wholesale water from the State Department of Water Resources via the
State Aqueduct system under a long-term contract through the Castaic Reservoir. In
addition, it has a contract for raw water with the Buena Vista Water Storage District and
the Rosedale-Rio Bravo Water Storage District for up to 11,000 AFY for 30 years through
2036 and may be extended.
SCVWA supplies include groundwater from 47 wells in the Alluvial and Saugus Formation.
The 47 wells are capable of pumping 77,820 gpm, a maximum capacity of 125,505 AF,
39,040 AF in a normal year and 58,830 AF in a dry year. Currently 41 wells are operational.
Other sources such as banking (10,000 AF), recycled water(450 AF), and imported water
(75,387 AF) provide nearly another 100,000 AF. Total available supply will be
approximately 200,000 AF by 2050 while demand rises from 57,000 AF in 2015 to a
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projected 93,900 AF in 2050. Thus, SCVWA has and is projected to have ample capacity
through 2050.
Wastewater treatment is provided by the Santa Clarita Valley Sanitation District of Los
Angeles County. However, SCVWA does provide wastewater collection services, but no
treatment, within a portion of what was the NCWD. At the time of SCVWA
consolidation, NCWD was in the process of transferring that responsibility to the City of
Santa Clarita. The Agency is continuing to move forward with the goal to transfer those
responsibilities to the City. Currently, SCVWA is working with the Spring Canyon
Development, the City of Santa Clarita, and the County of Los Angeles to identify
improvements necessary to the existing sewage lift station and force main to allow for
transfer to the City. SCVWA is also working on completing the transfer of the last
section, Sand Canyon Road to the Vista Canyon, through grant funding.
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FINANCIAL ABILITY TO PROVIDE SERVICE
The Agency has set up its accounting system by division with three retail divisions and one
regional division which tracks imported water. Each division is treated as an enterprise
function. In 2019, the Agency adopted a two-year budget which combines all four divisions. This
section will provide a consolidated view of the finances of the Agency and, where possible,
show the finances of each division. This section will review revenues, expenses, debt service,
rate structure, capital improvements, reserve policies, and OPEB.
Revenues and Expenses
In FY 2018-19 adopted budget planned for the spending of $144 million with anticipated
revenues of $153 million. Actual expenses were a little lower at $131 million, while actual
revenues were a little higher at $155 million. In 2019, the Agency adopted a two-year balanced
budget of $159 million for FY 2019-20 of $172 million for FY 2020-21. The total revenues and
expenses include both regional or wholesale water from the SWP and retail water which is
supplied to LACWWD #36 and drawn by residential and commercial customers from Santa
Clarita, Newhall, and Valencia. Table 6-1 shows the revenues and expenses for the FY 2018-19,
FY 2019-20, and FY 2020-21.
Table 6-1: Budgeted Revenues and Expenses FY 2018-19 to FY 2020-21
Projected
Adopted Budget 6/30/2019 Adopted Budget Revised Budget
Revenues/Expenses FY 2018-19 FY 2018-19 FY 2019-20 FY 2020-21
Revenues
Regional 68,717,253 69,511,288 71,883,274 78,590,793
Retail 84,629,723 85,156,212 87,493,395 93,821,712
Total 153,346,976 154,667,500 159,376,669 172,412,505
Expenses
Regional 64,827,282 57,925,429 76,656,515 78,590,793
Retail 79,892,377 73,720,450 82,720,154 93,821,712
Total 144,719,659 131,645,879 159,376,669 172,412,505
Source: SCVWA 2019b, 2020f.
The Agency recently completed its first full year audit as a consolidated agency for FY 2018-19.
Exhibit 6-1 shows the allocation of operating and non-operating revenues for all divisions, or
the Agency as a whole. As shown in the exhibit, the main revenue sources are property tax and
water sales, which are 30% and 49%, respectively.
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Municipal Service Review Financial Ability to Provide Service
Exhibit 6-1: Revenue Sources All Divisions
Interest Other Non-
revenue operating
4% revenue
1%
Property Taxes Water Sales
30% 49%
Other charges
16%
Source: SCVWA 2020e.
Exhibit 6-2 shows the allocation of operating and non-operating expenses for all divisions. The
largest expense is depreciation and amortization. This exhibit shows sources of water supply
and the purchase of water from SWP are some of the largest expenses. Agency-wide interest
expense and administration are 12% and 14%, respectively.
Exhibit 6-2: Expense Allocation All Divisions
Chart Title Disposal of
Capital Assets
State Water
1%
Contract
14%
Source of
Interest Expense
Supply
12% Pumping Transmission
16%
4% and
Water Resources Distribution
4% 4%
Water Treatment
Water Quality
5%
1%
Engineering Depreciation
2% 21% Administration
and
Maintenance
Management
2%
14%
Source: SCVWA 2020e.
Since the Regional Division and the Retail Divisions are very different, it might be more
instructive to view revenue and expense allocation for each division. Exhibit 6-3 shows revenue
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Municipal Service Review Financial Ability to Provide Service
sources for the first year of operations of the Agency and are derived from the FY 2018/19
audit. Although only one year, the allocations are fairly representative of revenues and
expenses of the Agency. In Exhibit 6-3, it is interesting to note that wholesale or regional water
only receives less than 30% of its revenues from water sales yet the Newhall and Valencia
Divisions receive almost all of their revenues from sales. The Santa Clarita Division has a more
balanced split of revenues between sales and charges for services. The regional water division
receives over 50% of its revenues from property tax.
Exhibit 6-3: Allocation of Revenues by Division January 1 - June 30, 2018
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Sales Other charges Taxes Interest revenue Other revenue
Regional Water Division Santa Clarita Water Division
Newhall Water Division Valencia Water Division
Source: SCVWA 2020e.
Exhibit 6-4 shows the allocation of expenses. It shows the source of water is a large portion of
expenses for all divisions. For the regional division it is represented by the State Water
Contract. Also noteworthy is the high percentage of Valencia and Newhall expenses that go
toward administration. The Agency has determined those costs are due to the way the financial
system used by VWC and NCWD, prior to Agency formation, tracks expenses. The Agency is
working to resolve the problem by updating the financial system which is slated to be
completed by May of 2021.
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Exhibit 6-4: Allocation of Expenses by Division January 1 -June 30, 2018
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Regional Water Division Santa Clarita Water Division Newhall Water Division Valencia Water Division
Source: SCVWA 2020e.
Debt Service
Total debt includes Certificates of Participation (COPs), Revenue Bonds, and the VWD
Acquisition Loan. As of June 30, 2019, outstanding principal was $389 million. Over the next
two years the Agency anticipates repaying approximately $35 million each year. In FY 2019-20
the Agency paid an additional $9 million to retire the debt on the 2008A COPs and 2014A
Revenue Bonds early. The revised budget anticipates a payment of $27 million in FY 2020-21.
Never-the-less by June 30, 2021 the principal owed by the Agency is estimated at $346 million.
Total debt will likely increase due to an anticipated new bond for $55 million that will be issued
in FY 2020-21. Table 6-2 shows the Regional Division’s and the retail divisions current debt
obligations.
In 2011 the Upper Santal Clara Valley Joint Powers Authority was created between CLWA and
the Devil’s Den Water District. Through the JPA the CLWA and later the Agency was able to
refinance several revenue bonds for a savings in excess of $16 million.
The source of debt service repayment is Facility Capacity Fees and the 1% property tax revenues.
The Facility Capacity Fees are considered payments from future users, while property taxes are
payments from existing property owners and water system users. Debt proceeds are used to
fund the Regional Division’s CIP program.
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Table 6-2: Debt Service Projections for the Regional and Retail Divisions
Payment Payment Outstanding
Series
Adopted Budget Adopted Budget Principal
FY 2019/20 FY2020/21 6/30/2021
Regional Division
2008A COPs $6,049,303 $6,098,284 $0
2014A Revenue Bonds 3,146,500 3,146,750 0
1999 COPs -- -- 79,575,040
2010A COPs 5,273,681 5,274,506 42,080,000
2015A Revenue Bonds 5,018,550 5,021,650 52,595,000
2016A-R Revenue Bonds 2,523,600 2,516,400 19,960,000
2016A-N Revenue Bonds 1,965,800 1,967,225 28,655,000
Total $24,954,409 $25,001,790* $222,865,040
Retail Divisions
2012 (2007) NWD $453,809 $453,809 $1,497,165
2009 (2016) NWD 148,653 148,653 0
2017A SCWD 5,253,625 5,374,875 41,615,000
Acquisition VWD 4,717,595 4,717,595 53,623,858
2018A Bond VWD 976,975 976,975 26,735,000
Total $11,550,658 $11,671,907 $123,471,023
Source: SCVWA 2019b.
*Note: SCVWA prepaid 2008A and 2014A payments in FY 2019/20 for FY 2020/21, so payment in FY 2020/21 for Regional Debt
payment was reduced to $16,545,113.
Water Rates
As a wholesaler and a retailer, the agency has two sets of rates each derived from separate
studies. Many of these studies were completed before consolidation for the individual divisions.
Rates were not changed with consolidation but will be adjusted as new rates are needed.
Retail Rates
Retail services are provided to three customer classes: single-family residential, irrigation
customer, and all other. The other class includes multi-family residential, institutional,
commercial, and industrial. Rates are composed of four components: a fixed monthly charge, a
commodity charge, a private fire protection charge, and a jumper charge. The fixed charge
depends on the size of the meter and is designed to recover the division’s fixed costs, such as
operations and maintenance, meter reading, billing, and accounting costs. The commodity
charge is the charge based on consumption. The private fire service protection charge is
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designed to recover the cost of providing water to properties that are required to have private
fire suppression systems or specifically request them. The jumper charge is imposed to
temporarily provide water when a property is not connected to the system.
Each water division has its own rates determined by rate studies before the consolidation. The
vast majority of customers, (i.e., 85% in the Newhall Division) are single-family residential
customers with a ¾-inch meter. For those customers, rates consist primarily of a fixed rate and
a variable commodity charge. A summary of rates by division is shown in Table 6-3, where ccf is
100 cubic feet or 748 gallons.
Table 6-3: Water Rates Retail (3/4-inch meter)
Composition Santa Clarita Newhall Valencia
Fixed ($) 22.32 16.14 16.81
Commodity charge per CCF ($) 1.99 2.8542 1.839
Purchased Water Pass-Thru Charges not included included included
Pass-Thru Rate per CCF ($) .05 n/a n/a
Untreated/recycled ($) n/a n/a 1.577
Effective Date 2020 7/1/2019 2020
Rate Study 2017 2015 2017
Source: SCVWA 2020a.
Wholesale Rates
The wholesale rate study was completed in 2016. Similar to retail rates, wholesale rates have
two components, a fixed rate, and a variable charge. The fixed charge is designed to recover
80% of the Agency’s fixed costs. The allocation of the charge among the retail purveyors is
based on the share of each purveyor in the consumption of imported water during the past
10 years. This approach ensures a direct link between the consumption of imported water and
the amount of costs covered, thus creating incentives for conservation. The variable charge is
designed to recover not only the variable costs related to water consumption but also 20% of
the fixed costs incurred by the Agency. The variable charge is based on the consumption of
imported water during the fiscal year. At present the fixed charge is $538/AF and the variable
charge or commodity charge is $244.46/AF.
SB 634 (Wilk) also requires that on or before January 1, 2019, SCVWA must develop a rate-
setting process that includes an independent ratepayer advocate. Their role is to advise the
board of directors and provide information to the public before the adoption of new wholesale
and retail water service rates and charges. The organizational chart shown in a later chapter,
Exhibit 8-1, shows that the Agency has met this requirement.
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Capacity Fees
Capacity fees are one-time fees imposed on customers requesting a new, an additional, or a
larger connection to a division’s water system. Capacity fees prevent a “free-rider” problem by
allowing the agency to charge new customers for certain costs of the existing system. The
agency avoids unfairly burdening existing customers with the cost of the system by distributing
an equitable portion of the system cost to new customers.
There are several different methodologies for calculating capacity fees. The two most
commonly used are 1) Equity Buy-In approach and 2) Incremental-Cost approach. The Equity
Buy-In approach is most appropriate for agencies that are mostly built out but still have some
capacity in the system to accommodate growth. This methodology ensures that new customers
pay the cost of the existing facilities. By contrast, the Incremental-Cost approach is most
appropriate for agencies anticipating construction of new facilities to meet new demand. The
costs of the new facilities are distributed to new customers based on the number of expected
additional meters, and the value of the additional Capital Improvement Program.
A division may find itself in a position where it satisfies both of these requirements. In that case
the division’s water system is already fairly built out, but the division also anticipates a
substantial amount of expansion related CIP spending to deal with growth related increases in
demand in the future. The division has adopted a hybrid approach to charge for both the cost
of the existing system and the proportional cost of new capacity required to serve their
demand on the water system. In 2018, the Agency adopted capacity fees for each division in
the agency. The areas are shown in Exhibit 6-5. Fees for each area are shown in Table 6-4.
Table 6-4: 2018 Regional Facility Capacity Fees and Charges ($/meter size)
WSA: West Valley
Meter
SubWSA: 1, 2, 11, 12, 13, 14, WSA: WSA:
Meter Size 15, 21, 22,
WSA: East Valley Newhall Ranch Whitaker-Bermite
24, 25, 28, 31, 32, 34, 35, 37,
Size (inches)
38, 39, 40 SubWSA: 23, 26, 27, 33, 36 SubWSA: 41, 42 SubWSA: 47
5/8" 0.625 $4,590 $6,450 $3,898 $7,277
3/4" 0.75 $6,886 $9,674 $5,847 $10,915
1" 1.00 $11,476 $16,124 $9,745 $18,192
1 1/2" 1.50 $22,952 $32,248 $19,489 $36,384
2" 2.00 $36,723 $51,597 $31,183 $58,215
Source: SCVWA 2018d.
Capital Improvements
The Agency maintains a Capital Improvement Plan based in part on its Asset Management Plan.
The Asset Management Plan is a detailed plan for maintaining and replacement of the Agency’s
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facilities and equipment. The plan covers land, buildings, machinery, and equipment that have
an original cost of $5,000 or more.
In FY 2019-20 the Agency anticipates spending $42 million for improvements on a regional basis
and $16 million on retail customer projects. Table 6-5 provides an overview of CIPs anticipated
for FY 2019-20 and FY 2020-21 for Regional Division system improvements and their funding
source. Similarly, Table 6-6 shows anticipated spending and funding sources for the retail
system. Funding is derived from the Capital Project Fund and property taxes for regional
improvements. Funding for major improvements for retail customer projects comes from a
combination of water rates, reserves, and connection fees. Minor retail improvements are
funded by water rates.
Table 6-5: Regional Division Capital Improvement Projects FY 2019-20 - FY 2020-21
Funding Sources
Capital Project
Regional Proposed Cost Fund Property Tax
Major Capital Projects $26,769,000 $24,259,000 $2,510,000
Minor Capital Projects 1,125,000 - 1,125,000
Capital Planning, Studies and Administration 10,152,938 - 10,152,938
New Capital Equipment 2,180,481 - 2,180,481
Major Repair and Replacement 1,755,000 - 1,755,000
Total Regional CIP $41,982,419 $24,259,000 $17,723,419
Source: SCVWA 2019b.
Table 6-6: Retail Divisions Capital Improvement Projects FY 2019-20 - FY 2020-21 Funding
Sources
Retail Proposed Cost Water Rates Reserves Connection Fees
Major Capital Projects $7,958,000 $2,468,268 $3,462,232 $2,027,500
Minor Capital Projects 8,513,439 8,513,439 - -
Total Retail CIP $16,471,439 $10,981,707 $3,462,232 $2,027,500
Source: SCVWA 2019b.
During its revision of the FY 2020/21 budget the Agency nearly doubled the funding for CIP’s
from $57 million to $112.8 million. Most of the increases were for major capital projects for
both regional and retail divisions. The Board approved an increase for regional projects from
$27 million to $50 million and for retail projects from $5 million to $33 million. Additional
funding was derived from reimbursements to the Regional CIP fund and contributions from the
Capital Project Fund and the Expansion Fund for retail projects.
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Santa Clarita Valley Water Agency
2018 RATES FOR REGIONAL FACILITY CAPACITY FEES AND CHARGES ($/METER SIZE)1
Revised July 18, 2018
Meter Meter WSA: West Valley WSA: East Valley WSA: Newhall Ranch WSA: Whitaker-Bermite
Size Size (inch) SubWSA: 1, 2, 11, 12, 13, 14, 15, 21, 22, SubWSA: 23, 26, 27, 33, 36 SubWSA: 41, 42 SubWSA: 47
24, 25, 28, 31, 32, 34, 35, 37, 38, 39, 40
5/8" 0.625 $4,590 $6,450 $3,898 $7,277
3/4" 0.75 $6,886 $9,674 $5,847 $10,915
1" 1.00 $11,476 $16,124 $9,745 $18,192
1 ½" 1.50 $22,952 $32,248 $19,489 $36,384
2" 2.00 $36,723 $51,597 $31,183 $58,215
2 ½" 2.50 $52,789 $74,171 $44,826 $83,684
3" 3.00 $68,856 $96,745 $58,468 $109,153
4" 4.00 $114,760 $161,242 $97,447 $181,922
6" 6.00 $229,519 $322,484 $194,894 $363,843
8" 8.00 $367,230 $515,974 $311,831 $582,149
10" 10.00 $527,894 $741,713 $448,257 $836,840
1The Facility Capacity Fees and Charges are calculated based on methods endorsed by the American Water Works Association
(AWWA) and presented in the Water Rate AWWA Manual M1.
EXHIBIT 6-5: FACILITY CAPACITY FEE REGIONS
Source: SCVWA 2018d
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Financial Ability to Provide Service
Financial Policies and Reserves
SCVWA is guided by its financial policies when developing a budget. The goal is to propose a
balanced budget. Policies include its Investment Policy, Debt Management Policy, Disclosure
Procedure Policy, Derivatives Policy, Purchasing Policy, Capitalization Policy, Wire Transfer
Policy, and Reserve Fund Policy.
The Investment Policy is reviewed annually. The policy requires the Agency invest funds to
provide the highest return with the maximum security while meeting cash flow demands and
conforming to all relevant statutes.
The Debt Management Policy was established to serve as a guideline for the use of debt for
financing infrastructure and project needs. Debt is issued and managed so as to maintain a
sound financial position and protect credit quality. The policy identifies the criteria for issuing
new debt that includes the Standards for Use and guidelines to determine when refinancing of
outstanding debt will be beneficial to the Agency and its customers.
The Disclosure Procedures Policy requires local officials to fully disclose particular financial
transactions to comply with the anti-fraud rules of federal securities laws. The purpose of the
policy is to memorialize and communicate procedures in connection with obligations, including
notes, bonds, and certificates of participation, issued by or on behalf of the Santa Clarita Valley
Water Agency.
The Derivatives Policy establishes accounting and reporting standards for derivative
instruments, a financial instrument which derives its value from the value of some other
financial instrument, variable or index, including certain derivative instruments embedded in
other contracts (collectively referred to as “derivatives”), and for hedging activities. The
Derivatives policy states that derivatives will not be used to speculate on perceived movements
in interest rates.
The Purchasing Policy outlines the procedures for the procurement of all goods and services
and applying best practices for optimizing cost savings, quality products and services, and for
assuring proper authority and limits as adopted by the Board of Directors in accordance with
State law.
The Capitalization Policy for Fixed Assets is used by the Agency to set a threshold, above which
qualifying expenditures are recorded as fixed assets, and below which they are charged to
expense as incurred. Fixed assets are defined as those assets with a value in excess of $5,000.
The policy also identifies the useful life of various fixed assets.
The Wire Transfer Policy, bank transfer, or credit transfer, is a method of electronic funds
transfer from one person or entity to another. The Agency recognizes the trend toward
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electronic payment methods and will receive and distribute much of its funds through
electronic wire transfers.
The Reserve Fund Policy is to ensure the Agency’s financial stability, and to have sufficient
funding available to meet its operating, capital, and debt service cost obligations. SCVWA has
established six reserve funds.
1. The Capital Improvement and Replacement Reserve is designed to fund capital and
asset replacement costs plus any contingency amounts in the event other sources
for capital funding are insufficient to complete capital projects.
2. The Emergency Disaster Reserve is established to provide additional liquidity in the
event of a natural disaster, financial crisis, economic uncertainty, loss of significant
revenue sources, local disasters or capital obligations, cash flow requirements, and
unfunded mandates.
3. The Capital Reserve is designed to fund unanticipated capital expenditures, or
additional repair and replacement projects.
4. The Operating Reserve is designed to safeguard the financial viability and stability of
the Agency and are funded from division specific revenues. The Operating Reserve
also acts to safeguard against unexpected events such as drought and major
catastrophic events.
5. The Revenue Rate Stabilization Reserve provides the Agency with the ability and
flexibility to avoid sharp increases in customers’ rates or to smooth out rate
increases over an extended time frame.
6. The Water Supply Reliability Reserve provides a source of funding for the extraction
of water from groundwater banking programs during dry years that will help to
further mitigate rate increases.
The reserves are summarized in Table 6-7 showing reserves for regional as well as retail
customers. As indicated, regional refers to wholesale water from State Water Project water,
while retail refers to water provided to the three divisions: Newhall, Valencia, and Santa Clarita.
The table shows the Agency has ample cash reserves to fund operations for over 3 years for the
Regional Division and 274 days for retail divisions.
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Table 6-7: Cash Reserves June 30, 2020
Reserve Fund Regional Retail Total
Capital Improvement & Replacement Reserve $17,723,419 $10,725,882 $28,449,301
Emergency/Disaster Reserve 28,783,894 5,458,419 34,242,313
Capital Reserve 18,088,911 8,376,094 26,465,005
Operating Reserve 25,823,851 12,553,132 38,376,983
Revenue Rate Stabilization Reserve 3,650,860 6,892,569 10,543,429
Details of Cash Reserve Balance for FY 2019-20 3,000,000 - 3,000,000
Bonds -
Total $97,070,935 $44,006,096 $141,077,031
Days Cash 1,231 274 588
Years 3.4 0.75 1.6
Source: SCVWA 2019b.
Other Post-Employment Benefits
Other Post-Employment Benefits (OPEB) refers to non-pension obligations of the Agency to its
retired employees. OPEB is accrued after vesting, which requires a minimum of 10 years of
CalPERS service credit. At 10 years the Agency contributes 50% of the cost. Each additional year
of service credit requires the employer to contribute another 5% until at twenty (20) years the
employer contribution is 100%.
Prior to the merger, NCWD’s past OPEB liabilities were fully funded and held in a trust (CERBT-
California Employers’ Retiree Benefit Trust). CLWA/SCWD past liabilities were also held in a
CERBT trust, but past liabilities were not fully funded. As part of the merger, employee benefits
between CLWA and NCWD were aligned and the Agency engaged a consultant to do an
actuarial study to estimate liabilities.
The Agency has a policy to prefund benefits to reduce the long-term cost to the Agency. The
Agency has determined it is advantageous to prefund for a number of reasons. Prefunding
provides funding security for current and future retirees by accelerating funding. It allows
access to the higher expected rates of return through equity-based investments in a qualified
trust. Prefunding matches payment of past service liability associated with previous ratepayers
to those ratepayers. In addition, payment of future normal costs creates the fairest
intergenerational equity for current and future ratepayers while stabilizing this element of the
rate base.
Table 6-8 shows the amount needed to fully fund OPEB liabilities by division as of June 30,
2019. The payment in FY 2019-20 would help meet the reserves needed to fully fund the
liability. In February of 2020, the Agency made a payment of $5,034,331 so that OPEB is up to
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date. Under its prefunding policy the agency contributes 100% or more each year of the
current year’s obligation.
Table 6-8: Current OPEB Obligations by Division
Values as of June 30, 2019
Division Regional SCWD Newhall Valencia Total
Actuarial Present Value of Projected Benefits $16,372,973 $8,526,556 $6,207,218 $2,302,915 $33,409,662
Actuarial Accrued Liability 11,945,282 6,423,500 5,286,292 294,354 23,949,428
Actuarial Value of Assets 10,204,817 5,231,576 3,107,512 371,192 18,915,097
Unfunded Actuarial Accrued Liability 1,740,465 1,191,924 2,178,780 (76,838) 5,034,331
Source: MacLeod Watts 2020.
Determinations
The SCVWA adopts a two-year budget and recently adopted a balanced budget for FY
2019-20 and FY 2020-21. The Agency anticipates spending approximately $159 million in
FY 2019-20 and approximately $172 million in FY 2020-21. For FY 2018-19, the Agency
anticipates $131 million in expenses offset by $155 million in revenues.
The Agency recently completed its first full year audit as a consolidated agency. The
largest expense is depreciation and amortization. This exhibit shows sources of water
supply and the purchase of water from SWP are some of the largest expenses. Agency-
wide interest expense and administration are 12% and 14%, respectively.
Reviewing revenues and expenses for the divisions shows the largest source of revenues
for the Regional Division is property tax, while the largest source for retail divisions is
water sales, as expected. The source of water is a large portion of expenses for all
divisions. Also noteworthy is the high percentage of Valencia and Newhall
administrative expenses. The Agency has determined those costs are due to the way the
financial system, used by VWC and NCWD prior to Agency formation, tracks expenses.
The Agency is working to update its financial system which should resolve the problem.
Total debt of the consolidated agency includes Certificates of Participation (COPs) and
Revenue Bonds and the VWD Acquisition Loan for a total outstanding principal of $389
million as of June 30, 2019. The Agency plans to pay down the debt by approximately
$36 million each year over the next two years.
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Water rates were set according to studies completed before consolidation. Ratepayers
pay a base rate plus a commodity charge per one hundred cubic feet or CCF. Each retail
agency has a different rate.
In 2016, the Santa Clarita Water Division contracted for a capacity fee study. The
approach allowed for new development to buy into existing facilities as well as to fund
new facilities required by the development. In 2018, SCVWA adopted a regional capacity
fee schedule for each area of the agency. The updated single-family residence capacity fee,
for a ¾ inch meter, ranges from $5,800 to $10,900 depending on the area.
The Agency has a Capital Improvement Plan. Regional projects are funded by the Capital
Project Fund and property tax revenues. Retail projects are funded by water rates,
reserves, and connection fees. The adopted budget indicated the Agency expects to
fund $41.9 million for regional and $16.5 million for retail divisions. In the revised FY
2020/21 budget funding was increased to $67.1 million for regional and $45.7 for retail
system projects.
SCVWA is guided by its financial policies when developing a budget. Policies include its
Investment Policy, Debt Management Policy, Disclosure Procedure Policy, Derivatives
Policy, Purchasing Policy, Capitalization Policy, Wire Transfer Policy, and Reserve Funds
Policy. The Agency has sufficient reserves for 1,231 days for the Regional Division and
274 days for the retail divisions.
In February of 2020, the Agency made a payment of $5,034,331 so that OPEB is up to
date. Each year the budget allocates a prepayment to keep the total over time up to
date.
The SCVWA has sufficient revenues and reserves to provide services.
6-14
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Opportunities for Shared Facilities
STATUS AND OPPORTUNITIES FOR SHARED FACILITIES
Cost Savings through Economies of Scale
Since forming in 2018, the Agency has projected savings of nearly $20 million by the end of FY
2020-21. These include economies of scale, unifying various software and systems across
divisions, and integrating work teams for more efficient responses. The savings for VWC in taxes
and fees are projected at $10.5 million which are being used to pay for VWC legacy debt.
SCVWA in its most recent budget identifies projected cost savings for SCVWA as a result of the
consolidation, as shown in Table 7-1.
Table 7-1: Projected Cost Savings
FY 2017-18 FY 2018-19 FY 2019-20 FY2020-21 Total
Salaries and Benefits $ 328,493 $ 1,001,101 $1,037,134 $ 1,074,249 $ 3,440,977
Insurance 291,667 816,000 887,630 909,909 2,905,206
Elections - 552,000 - 40,000 592,000
Audit and Tax Consulting 167,755 172,788 177,971 183,310 701,824
Internal Repair Crews 90,000 180,000 180,000 180,000 630,000
Legislative Advocacy 29,000 78,000 80,340 82,750 270,090
Other2 248,950 208,338 228,118 229,951 915,357
Subtotal $ 1,155,865 $ 3,008,227 $ 2,591,193 $ 2,700,169 $ 9,455,454
VWC Taxes & Fees 1,286,479 3,064,447 3,077,085 3,090,102 10,518,113
Total Projected Savings $ 2,442,344 $ 6,072,674 $ 5,668,278 $ 5,790,271 $19,973,567
6 Month Period (January - June 2018)
2Other - Board reduction, memberships, registration fees and miscellaneous taxes
Source: SCVWA.2019b.
Joint Powers Agreements
SCVWA is a member of several joint powers authorities that allow it to share costs with other
agencies and improve service. SCVWA is also a member of ACWA/JPIA. The membership allows
the Agency to realize savings in workers compensation, risk management and insurance as part
of a pool.
The new agency joined with several local agencies to form a Groundwater Sustainability Agency
(GSA) pursuant to Section 10723.6 of the Water Code. The purpose of the GSA is to develop and
implement a groundwater sustainability plan within the agency in accordance with Chapter 6
(commencing with Section 10727) of Part 2.74 of Division 6 of the Water Code.
7-1
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Opportunities for Shared Facilities
SCVWA is located in the Santa Clara River Valley East Basin, which extends throughout much of
the Santa Clarita Valley. The basin is designated as a high priority basin by the Department of
Water Resources.
SCVWA is a participant in the GSA which was created through a Memorandum of
Understanding including the following members: 1) Newhall County Water District, 2) Castaic
Lake Water Agency, 3) Santa Clarita Water Division, 4) Los Angeles County Waterworks District
#36, 5) City of Santa Clarita, and 6) County of Los Angeles. The first three members are now
combined into SCVWA. The members of the GSA have selected leadership to sit on the GSA
Board of Directors and are discussing the transition of the GSA into a Joint Powers Authority.
SCVWA is also a member of State Water Project Contractors Authority. This JPA governs the
State Water Project or water that flows through the California Aqueduct. This agreement
allowed the former Castaic Lake Water Agency to sell wholesale water to Newhall, Santa
Clarita, and VWC to serve retail customers in their respective divisions.
The Agency is also a member of the Upper Santa Clarita Valley JPA with the Devil’s Den Water
District. The purpose of the JPA is twofold. One is to allow CLWA to refinance its bond debt.
Refinancing several bonds resulted in a savings in excess of $16 million. The second is to allow
for the creation of a solar panel field that would cover 3,000 acres.
SCVWA is also a participant in advancing the Sites Reservoir through its membership on the
Sites Reservoir Committee. This project has the potential of providing 5,000 AF of dry-year
supplies.
Management Efficiencies
Management efficiencies are often measured by whether the Agency has planning activities
both long-range and short-range. The Agency develops a two-year budget. As part of the
budget analysis, the Agency reviews performance measures and whether the department has
achieved them, are progressing toward achievement, or whether they have not achieved the
measure.
SCVWA has completed a five-year strategic plan. The purpose of the plan is to guide the Agency
in the next 5 years. The overall goal is to provide “exemplary water management for a high
quality of life in the Santa Clarita Valley.” The goal will be accomplished by fulfilling the mission
of SCVWA, providing responsible water stewardship to ensure the Santa Clarita Valley has
reliable supplies of high-quality water at a reasonable cost. The plan identified six areas to
accomplish that goal.
7-2
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Opportunities for Shared Facilities
1. Customer/Community - Implement and communicate policies supporting the social
quality of life, and environmental values of the community.
2. Infrastructure Reliability – Implement, operate, and maintain water infrastructure to
ensure sustainable water service provision.
3. Water Supply and Resource Sustainability – Implement programs to ensure the
service area has reliable and sustainable supplies of water.
4. Water Quality and Environmental compliance - Protect the quality of water supplies
and environment and ensure drinking water quality is consistent and meets or
exceeds water quality requirements.
5. Financial Resiliency – Maintain a long range, transparent, stable, and well-planned
financial condition, resulting in current and future water users receiving fair and
equitable rates and charges.
6. High Performance Team – Grow a culture of continuous improvement that fosters
SCVWA’s values.
Prior to SCVWA’s consolidation, the CLWA completed a Groundwater Management Plan in
2003. The plan area includes all of SCVWA territory. The Groundwater Management Plan
included seven elements:
1. Monitoring of groundwater levels, quality, and subsidence
2. Monitoring and management of surface water flows and quality
3. Determination of basin yield and avoidance of overdraft
4. Development of regular and dry year/emergency water supply
5. Continuation of conjunctive use operations
6. Long-term salinity management
7. Integration of recycled water
The SCVWA has an adopted Urban Water Management Plan. The most recent plan was
completed for 2015. Urban Water Management Plans need to be updated every five years. The
Agency is compiling the 2020 Plan.
The SCVWA has also adopted an Asset Management Plan/Capital Improvement Plan. Details of
the Capital Improvement Plan are discussed in the budget. The Asset Management Plan is a
detailed plan for maintaining and replacement of the Agency’s facilities and equipment. The
plan covers land, buildings, machinery, and equipment that have an original cost of $5,000 or
more.
7-3
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Opportunities for Shared Facilities
Other planning tools include the Integrated Regional Water Management Plan (IRWMP), the
CLWA Reliability Plan, the Communications Strategic Plan, 2018 Facility Capacity Fee Study, the
Santa Clarita Valley Water Use Efficiency Strategic Plan (SCVWUESP), the SCVWA Organizational
Assessment and Asset Management Program Gap Analysis Report, and the retail division’s
Water Master Plans.
Determinations
The Agency projects savings of nearly $20 million by the end of FY 2020-21 due to the
consolidation and economies of scale.
The Agency participates in a number of JPAs that allow it to share costs with other
agencies and improve service. They range from the State Water Project Contractors
Authority to the GSA to the ACWA/JPIA, which allows the Agency to realize savings in
insurance costs.
Management efficiencies are often measured by whether the Agency has planning
activities both long-range and short-range. The Agency has demonstrated management
efficiencies by several planning tools ranging from its two-year budget, its Capital
Improvement and Asset Management Plan and its five-year strategic plan.
7-4
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Accountability and Governance
ACCOUNTABILITY AND GOVERNANCE
SB 634 (Wilk) provided that the initial board include all directors from the predecessor agencies
plus an appointed member representing LACWWD #36. At that time, five were directors of
NCWD and 10 were directors of CLWA for a total of 15. The Agency consists of three electoral
divisions one for each of the three retail areas. Ultimately the Board will consist of nine
members, three from each electoral division. Board members receive $228.15 in compensation
for each day of service for up to 10 days per month.
Membership will be reduced as terms expire, by vacancies, and by eliminating the appointed
position on January 1, 2023. Those members whose terms expired in 2018 were not replaced
and with one additional vacancy the board now consists of 12 members including the
appointed representative of LACWWD #36. Following the 2020 general election, the terms of
members that would have expired in 2020 now expire following the 2022 general election. Two
directors will be elected for each electoral division at the 2020 general election, and at every
election on that 4-year election cycle thereafter. One director will be elected for each electoral
division at the 2022 general election and at every election on that 4-year election cycle
thereafter.
In 2019, the legislature passed SB 387 (Wilk) to assist in reducing to nine members. SB 387
(Wilk) amends SB 634 (Wilk) so that if a member resigns, vacates or is removed from office
before the end of their term and there are fewer than 3 members representing the electoral
division, the Board of Directors can appoint a successor from the division in which the vacancy
occurs.
The Divisions are shown in Exhibit 8-1. Directors and the expiration date of their terms are
shown in Table 8-1.
SCVWA Board of Directors meetings are held the first and third Tuesdays of each month at 6:30
p.m. All Board of Directors meetings are open to the public and comply with the Brown Act.
Any member of the public who wishes to address the Directors at a Board meeting may do so
during the portion of the meeting set aside for public comment.
8-1
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Accountability and Governance
Table 8-1: SCVWA Board of Directors
Director Division Term Expires
William Cooper, President 1 January 2023
Maria Gutzeit, Vice President 3 January 2021
Gary R. Martin 1 January 2021
B.J. Atkins 3 January 2021
Ed Colley 2 January 2021
Kathy Colley 2 January 2021
Robert J. DiPrimio 1 January 2021
Jeff Ford LACWWD #36 January 2023
E.G. “Jerry” Gladbach 2 January 2023
R.J. Kelly, Vice President 1 January 2023
Dan Mortensen 3 January 2023
Lynne Plambeck 3 January 2023
Source: SCWVA 2019b, Martin 2020.
Devil’s Den Water District (DDWD)
SCVWA maintains a unique relationship with the Devil’s Den Water District (DDWD) which is a
California Water District that straddles the Kern County / Kings County boundary. There
appears to be three residences in the district. It is a landowner-based district, where
representation on the Board of Directors is determined by property owners in the District.
On October 25, 1988, the CLWA purchased land and equipment owned by Producers Cotton Oil
Company. Of the 8,459 acres of land purchased in Kern and Kings Counties, approximately
7,759 acres are within the Devil’s Den Water District. The SCVWA holding represents nearly
90% of the District’s 8,676 acres. SCVWA leases all the property to Rolling Hills Farms (RHF), an
outside party, under terms of an operating lease agreement. The lease is a trade agreement
where RHF is allowed to farm in exchange for maintaining the property
DDWD was originally a State Water Project contractor which was allocated 12,700 AFY. CLWA
was also a State Water Project contractor with its own water supply contract. As a result of the
land acquisition, DDWD’s water supply contract with the State was terminated and in 1991,
added to CLWA’s water supply contract. Since DDWD is a landowner voter district and SCVWA
owns the vast majority of the property within DDWD, the DDWD Board of Directors is
composed of five designated representatives of SCVWA’s board now the SCVWA’s board, three
from Division 1 and two from Division 2.
8-2
EXHIBIT 8-1: SCVWA ELECTORAL DIVISION MAP
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Accountability and Governance
Staffing
When all of the former districts were consolidated, all current staff became part of SCVWA. The
Organizational chart of the SCVWA is shown in Exhibit 8-2. The number of employees and their
hiring agency is shown in Table 8-2. After the SCVWA consolidation, the newly formed Agency
began a review of all positions and compensation. In its revision of the FY 2020-21 Budget the
Board reduced the number of employees to 220.
Table 8-2: Historical Number of Employees
Agency CLWA SCWD NCWD VWC Total
No. of Employees 86 59 30 48 223
Source: SCVWA 2018a.
Communications with Customers
The Agency maintains a website that provides information to the public on a number of issues
including water conservation, governance, water quality, and the learning center. The
governance tab provides information about Board meetings, the Board of Directors, and the
election process. It also includes a transparency tab that provides customers with easy access to
information, such as Agency finances, operations, policies, and services.
The Agency publishes and distributes an e-newsletter (Water Currents). The newsletter is
published monthly and provides residents with information on activities of the Agency,
upcoming meetings of the Board and its committees. It also includes gardening tips, and water
conservation programs. The Agency maintains a speakers’ bureau to provide speakers for
meetings of various community organizations on water-related topics. SCVWA is also active on
social media.
Awards
The Agency has received a number of awards for excellence in service. Most recently, the
Agency received CSDA’s Transparency Certificate of Excellence in recognition of its outstanding
efforts to promote transparency and good governance. In 2018, the Agency received Best in
Blue Finalist consideration from the Association of California Water Agencies for excellence in
outreach. Last fiscal year, FY 2018-19, the Agency received the Excellence Award from the
California Society of Municipal Finance Officers and the Distinguished Budget Award from the
Government Finance Officers Association.
8-4
EXHIBIT 8-2:
SCVWA ORGANIZATIONAL CHART
Source: SCVWA 2019b
28
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Accountability and Governance
Determinations
The Agency is governed by a 12-member Board of Directors representing its three retail
divisions. The Board includes one appointed member representing LACWWD #36. The
LACWWD #36 seat expires in 2023 (SB 634 10(c)). Eventually the 12 members will be
reduced to nine members, due to attrition. Board members receive $228.15 in
compensation for each day of service for up to 10 days per month.
The SCVWA Board of Directors meetings are held the first and third Tuesdays of each
month at 6:30 p.m. Meetings are held at SCVWA headquarters at 27234 Bouquet Canyon
Rd, Santa Clarita, CA 91350. Meetings are held in accordance with the Brown Act.
The CLWA acquired 90% of the Devil’s Den Water District in 1988 as part of the purchase
of Producers Cotton Oil Company. CLWA subsequently received the SWP’s allocation to
Devil’s Den Water District. The Devil’s Den Water District is a California Water District and
a landowner voter district. As the landowner of 90% of the District, former CLWA and
now SCVWA directors serve as the governing board for Devil’s Den Water District.
The consolidated Agency initially had a staff of 223 from the four agencies. In its revision
of the FY 2020-21 budget the Board reduced staff to 220.
The Agency maintains a website that provides information to the public on a number of
issues including, water conservation, governance, water quality, and the learning center.
The Agency publishes and distributes an e-newsletter, (Water Currents). The newsletter is
published monthly and provides residents with information on activities of the Agency.
8-6
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Matters Affected by Commission Policy
MATTERS RELATED TO EFFECTIVE OR EFFICIENT SERVICE DELIVERY, AS
REQUIRED BY COMMISSION POLICY
This chapter will discuss how LA LAFCO policies would affect service delivery. Government Code
§56300 requires each Commission to establish policies and procedures in order to exercise its
powers and authority. In the absence of a specific policy CKH acts as the default to guide the
Commission. Policies applicable to SCVWA include the LA LAFCO conditions pertaining to the
formation of the Agency and LA LAFCO’s Sphere of Influence policy.
The SCVWA was formed by a legislative act, SB 634 (Wilk), in October 2017, in part, because LA
LAFCO lacked the statutory authority under CKH to consolidate the two districts with the
governing board that CLWA and NCWD desired. In particular, the size of the governing board
needed to accommodate existing board members whose terms had not expired and to
determine the ultimate make-up of the governing body. A subsequent piece of legislation, SB
387 (Wilk), was passed in 2019 to further guide the board reduction from four members in each
electoral district to three.
The law which formed the Agency recognized that LAFCO had the sole and exclusive authority
for completing changes of organization which included the consolidation of Castaic Lake Water
Agency and Newhall County Water District. SB 634 (Wilk) required an application to be
submitted to Los Angeles LAFCO and required the new agency to comply with any LAFCO
conditions pertaining to the formation of the Agency.
The Commission adopted 22 conditions. To date, the Agency has complied with 20 of them.
One of the conditions requires the Agency to apply to annex territory adjacent to the Agency
boundary that was formerly served by the VWC. To meet this condition, the Agency has
submitted an annexation application which is being processed by LAFCO. Another condition
requires the Agency to fund the MSR and establish policies consistent with current law. This
MSR is a result of compliance with that condition. The Agency has been working with LA LAFCO
cooperatively on the remaining conditions.
The Commission adopted its Sphere of Influence Policy on November 13, 2019. The policy
states:
Coterminous Sphere of influence: A sphere of influence (SOI) for a city or special
district that includes the same physical territory as the jurisdictional boundaries of that
city or special district. The Commission adopts a Coterminous SOI if there is no
anticipated need for services outside the jurisdictional boundaries of a city or special
9-1
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Matters Affected by Commission Policy
district, or if there is insufficient information to support inclusion of additional territory
within the sphere.
The Agency's operations are consistent with the Coterminous SOI for the Agency adopted by
the Commission on April 11, 2018. The sole exception is where the Agency provides service to a
portion of the former VWC territory, which is outside the Agency's existing jurisdictional and
SOI boundary. This occurrence is being addressed with this MSR and SOI Update and the by the
Agency's timely submittal of a proposal for annexation of the VWC territory. It is anticipated
the annexation will be considered by the Commission in late 2020 or early 2021. In this regard,
the Agency is providing effective or efficient service delivery, as required by the Commission's
Sphere of Influence Policy.
Determination
The Agency’s operations must address LA LAFCO’s approved conditions pertaining to the
formation of the Agency. LA LAFCO adopted 22 conditions. To date, the Agency has
complied with 20 of them. The Agency has been working with LA LAFCO cooperatively on
the remaining conditions.
The LA LAFCO Sphere of Influence for a coterminous sphere applies to SCVWA. The
Agency’s operations are consistent with the Coterminous SOI adopted by the Commission
on April 11, 2018. The sole exception is where the Agency provides service to a portion of
the former VWC territory which is outside the Agency’s existing jurisdictional and SOI
boundary. SCVWA has submitted an annexation proposal for the territory to LA LAFCO
which will be considered in late 2020 or early 2021. In this regard the Agency is providing
effective efficient services, as required by the Commission’s SOI Policy.
9-2
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Sphere of Influence Considerations
SPHERE OF INFLUENCE CONSIDERATIONS
This MSR includes a discussion of an appropriate SOI for the agency. In establishing the SOI CKH
prescribes the Commission must make determinations in five areas. They include:
1. Present and planned land uses in the area, including agricultural and open space
lands. This consists of a review of current and planned land uses based on planning
documents to include agricultural and open-space lands. This will address the
research questions on present and planned land uses.
2. Present and probable need for public facilities and services. This includes a review
of the services available in the area and the need for additional services.
3. Present capacity of public facilities and adequacy of public services provided by
the agency. This section includes an analysis of the capacity of public facilities and
the adequacy of public services that the SCVWA provides or is authorized to
provide.
4. Social or economic communities of interest. This section discusses the existence of
any social or economic communities of interest in the area if the Commission
determines that they are relevant to the SCVWA. These are areas that may be
affected by services provided by the Agency or may be receiving services in the future.
5. Present and probable need for services to unincorporated disadvantaged
communities. Beginning July 1, 2012, the Commission must also consider services to
disadvantaged communities which are defined as inhabited areas within the SOI.
There are seven potential areas to consider for the SOI. These areas are identified in Exhibit 10-
1 as area A, B, C, D, and E and Tapia Ranch and Tesoro del Valle developments, Phase A -D.
Area A as shown is a small area that was previously within the jurisdictional boundary of the
former NCWD but outside the jurisdictional boundary of the former CLWA. Area A is also
outside the jurisdictional boundary of the SCVWA as determined by SB 634 (Wilk) and the
conditions pertaining to the formation of the Agency. There are currently are no services
provided to the area. It could be included as a way to complete the consolidation of NCWD.
10-1
EXHIBIT 101: POTENTIAL SPHERE OF INFLUENCE AREAS
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Sphere of Influence Considerations
Area B includes two small discontiguous areas that are islands surrounded entirely by existing
SCVWA jurisdictional territory. The islands are part of a land fill and are undeveloped.
Consequently, SCVWA provides no services to these two islands.
Area C is an area served by VWC that is also outside SCVWA boundaries. The area is located just
west of I-5 off Valencia Boulevard. The area includes 577 parcels on approximately 343 acres. At
build out the development would include 546 single-family homes. One of the LAFCO
conditions pertaining to the formation of the Agency is that the Agency apply for annexation by
January 1, 2020. The application has been submitted, but a Sphere amendment is needed. The
Sphere amendment can be proposed in the MSR or separately and approved concurrently by
LAFCO with its consideration of the annexation.
Area D is the undeveloped area that appears as an inverted key. Present zoning is residential.
The area can be developed in the future but there are currently no plans to do so.
Area E is territory within the Santa Clarita City limits but not in SCVWA boundaries. There is
one area in the north and two on the southeast border. All the territory is in the Angeles
National Forest and undeveloped.
A sixth area would include the proposed Tapia Ranch subdivision, located approximately 1.5
miles southeast of the Castaic community south of Castaic Lake, approximately 1 mile east of I-
5, and north of the agency boundary. The extent of the proposed subdivision is shown in Exhibit
10-1. The Tapia Ranch site includes approximately 1,167 acres of undeveloped hillside and
canyon land. At build-out the development would include 405 detached single-family homes.
It is likely that the Agency would provide water to the development.
The last area is the Tesoro del Valle master-planned community. The development is a phased
development with four phases. Phase A was developed in 2006, and Phase B-D, sometimes
referred to as Tesoro Highlands, has yet to be developed. Tesoro del Valle contains over 1000
residential units, an elementary school, recreation center, a private park, and the Tesoro Adobe
Historic Park.
Most of the Tesoro development will be in the current Agency boundaries, but a small portion
of Tesoro Highlands is outside. Tesoro Highlands, at buildout, will include 820 residential units,
a community center, a senior center, open space, and a helipad. Of those residential units 346
are outside Agency boundaries. The area is also shown in Exhibit 10-1.
The Agency has completed a service agreement to provide water to the Tesoro development
from Buena Vista Water Storage District
10-3
LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Sphere of Influence Considerations
As required, the following will evaluate each area according to the five determination areas.
Whether or not to include the area will depend on three criteria. First is whether the area will
likely be developed and require services. Considering the definition of the SOI as the logical
extent the Agency’s service boundary, if the area because of its geographical characteristics is
not likely to need services it should not be included, unless there are other considerations.
Second, one of the five determination areas, the present and planned land use. If the area is
already designated for residential use it could need services at some point in the future. A
designation of National Forest could also determine the need for services. The decision to
include an area may come down to potential for development within this SOI cycle.
Present and planned land uses in the area, including agricultural and open space lands.
Area A currently is designated as OS-NF, Open Space – National Forest. The area will most likely
remain that designation. It would be included to complete the consolidation of NCWD. Area B
currently does not receive water service but appears as two discontiguous islands within the
Agency’s boundaries. In the Los Angeles Santa Clarita Area Plan it is designated as Significant
Ecological Area. It is currently undeveloped and likely to remain that designation. Area C is
developed, predominantly residential, but includes an area of OS-P, parkland, a high school,
middle school, and elementary school. It is likely to remain with its current designations. Area D
is designated as H2 or Residential 2, two dwelling units per acre, and H5, Residential 5, five
dwelling units per acre. The area currently is not slated for development but can be developed
in the future.
Area E is currently undeveloped and is zoned National Forrest. At present there are no other
planned land uses.
Tapia Ranch is currently designated RL2, RL5, and RL10, rural lands with one dwelling unit per 2
acres, 5 acres and 10 acres, or non-urban. The Santa Clarita Valley Area Plan designated the
area as ‘Hillside Management’ because some slopes exceed 25%. The Area Plan allows for
development of 405 dwelling units. The completed project will convert much of the rural lands
to higher density residential leaving 724.5 acres of the 1,167 acres as open space.
The Tesoro del Valle Phase A subdivision is already developed. The mix of residential land uses
would be unchanged. The Tesoro Highland subdivision is currently zoned as national forest and
has been pre-zoned by the City in anticipation of annexation for residential development.
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Present and probable need for public facilities and services.
Areas A and B currently are not served and would only require services if they were developed.
Area C already has services as it is developed but would benefit from being part of the Agency
boundary, particularly so residents could vote for the directors who set their water rates.
Area D currently does not need services as it is undeveloped. Any proposed development in
this area would require services.
Area E also does not require services at present. Single family residents may install a private
well or request service from SCVWA. Large scale developments will likely require service from
the Agency.
Tapia Ranch currently has no services but upon development would require municipal services
that the Agency provides. The Development Plan sets aside 6.8 acres as a recreational facility,
which could include equestrian trails as determined by the homeowner’s association.
The Tesoro Highlands subdivision would require an estimated 298 AFY of water. The source
would be the Agency’s storage facilities at Buena Vista Water Storage District (BVWSD) and
Rosedale-Rio Bravo Water Storage District (RRBWSD).
Present capacity of public facilities and adequacy of public services provided by the agency.
As shown in Chapter 5, the Agency has sufficient capacity to serve new developments. Water
supply through groundwater, SWP water, banked water and recycled water exceeds demand by
a factor of two. In addition, there is sufficient capacity at the water treatment facilities.
In 2006 CLWA certified that it had estimated 4,375 AFY available to support water demands for
newly annexed areas. Of that amount 1,500 AFY of BV-RRB supplies was identified for future
demand of the Tesoro project.
The BVWSD and RRBWSD facilities have a contract with the former CLWA, now SCVWA, for
11,000 AFY. The Tesoro subdivision would require an additional 298 AFY. SCVWA would
provide water as the CLWA had already agreed to provide water in 2017.
Social or economic communities of interest.
These are areas that may be affected by services provided by the Agency or may be receiving
services in the future. There are two communities of interest that may be affected by a new
Sphere of influence. One is the City of Santa Clarita and the other is the Community of Castaic.
Neither of these communities would be affected by development at Tapia Ranch or Tesoro del
Valle as it relates to water issues because the Agency charges impact fees based on the cost of
new facilities and the cost of existing facilities. Second, the Agency has sufficient water supply
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to serve proposed new development. These communities would be affected by other issues
such as traffic and air quality that would be addressed in the CEQA analysis for the
development.
Present and probable need for services to unincorporated disadvantaged communities.
The most recent map prepared by LA LAFCO shows a DUC adjacent to the Santa Clarita City
limits but already within SCVWA boundaries. Upon development and annexation water would
be provided by SCVWA, fire by Los Angeles County Fire District which currently serves the area,
and sewer by annexation to Santa Clarita Valley Sanitation District of Los Angeles County.
Conclusions
Based on this analysis area A should be included in the Sphere. Including the area in the
SCVWA Sphere would make the consolidation with NCWD whole.
Area B should be included in the SOI because the two islands are surrounded by SCVWA
territory. Although the area is part of a landfill adding the area will make a more logical
boundary.
Area C should be included because the area is mostly developed and receives services. The area
was served by VWC before the formation of SCVWA. Like Area A adding the area to the Sphere
would make the inclusion of VWC into SCVWA whole. Since SCVWA has already applied to
LAFCO to annex the territory, inclusion in the Sphere would allow for concurrent annexation.
Area D should be considered because the land use designation allows it to be developed.
Adding it to the Sphere allows an annexation to create a logical boundary. At present there are
no pending plans to develop this area.
Area E should be included in the SOI since the territory lies within the City of Santa Clarita. All
other territory within the City receives water services from SCVWA. If these areas are ever
developed, they would need water services from the Agency.
Tapia Ranch should be considered for inclusion in the SOI as the landowner proposes to add
405 new dwelling units which would require water services. The Agency has already entered
into a deposit and funding agreement with the owner and has provided a water availability
letter as a step toward potential annexation.
The portion of the Tesoro Highlands that are currently outside Agency boundaries should be
included as it will likely require water service and annexation to SCVWA upon development.
The Agency has already entered into an annexation agreement with the owner.
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Municipal Service Review Sphere of Influence Considerations
With the addition of the Tesoro development and inclusion of Area A in the Sphere an island of
approximately 85 acres would be created between the two areas. The island, like Area A, is
located in the Angeles National Forest. A closer examination of the terrain of the island shows
that it consists of the ridgeline between Tesoro and Area A. It would be very difficult to
develop that area and provide water service. Since the ridgeline, the island, is zoned National
Forrest and because of terrain, it is unlikely to ever require services. Therefore, it is not
recommended to be included in the Sphere.
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Municipal Service Review Recommendations
RECOMMENDATIONS
This section discusses recommendations which do not require Commission action. It is
apparent it will take some time to fully adjust to the consolidation. One area to focus on would
be consolidation of administrative staff. Newhall and Valencia Divisions appear to spend a
larger portion of their budget on administration than the other divisions, as shown in the
Exhibit 6-4. The Agency is aware of this issue and has determined it is due to how those two
divisions record administrative costs. The Agency is in the process of updating its financial
system which when completed in 2021 should result in more consistent assessment of
administrative costs between divisions.
Future Studies
In the future, it might be useful to do an agency wide rate study so that residents in one
division do not pay different rates than another division. The rate study should identify cost of
service principles to ensure fair rate allocation for all customers.
The addition of a rate payer advocate is a good addition to lend the voice of ratepayers to
deliberations on new rates. However, it is unclear how the rate payer advocate would
communicate with rate payers to provide and receive input on rates. The Agency might
consider a citizens advisory committee to work with the rate payer advocate. The Agency
might consider a citizens advisory committee to work with the rate payer advocate. A citizens
advisory committee could result in more communication with rate payers, enhanced
transparency, and greater acceptance of the rate setting process.
The Agency should consider reviewing its position with respect to the Devil’s Den Water
District. DDWD appears to be primarily in agricultural use and potentially uninhabited by CKH
standards. One of the concerns is the distance between the DDWD and SCVWA. As part of the
analysis provided in this MSR, Kings LAFCO and Kern LAFCO were contacted for information
about DDWD. Very little data was available so it might be useful to request an update to the
DDWD MSR by Kings and/or Kern LAFCO to shed light on the operation of that district. This
would allow SCVWA and LAFCO to determine the best way to serve that area.
The Agency may want to consider a consolidation with LACWWD #36, a matter which was
addressed in Section 4(i) of SB 634 (Wilk), the law which created the SCVWA:
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Municipal Service Review Recommendations
Los Angeles County Waterworks District #36, Val Verde, upon mutual agreement
between it and the agency, may be annexed or consolidated into the agency following
appropriate procedures under the Cortese-Knox-Hertzberg Local Government
Reorganization Act of 2000 (Division 3 (commencing with Section 56000) of Title 5 of the
Government Code). Any proposed future change of organization or reorganization
involving the agency and the Los Angeles County Waterworks District #36, Val Verde, or
any other public agency under the Local Agency Formation Commission for the County
of Los Angeles on or after January 1, 2018, shall be subject to the filing with the Local
Agency Formation Commission for the County of Los Angeles and shall be subject to
review, consideration, and determination by the Local Agency Formation Commission
for the County of Los Angeles consistent with the Cortese-Knox-Hertzberg Local
Government Reorganization Act of 2000 (Division 3 (commencing with Section 56000) of
Title 5 of the Government Code).
In addition to the reference in the law, it is important to note LAFCOs are also tasked with
promoting the efficient delivery of governmental services, including retail water service. LAFCO
analyses often examine a range of service providers, identify potential improvements and
efficiencies, and examine whether there exists a duplication of service.
The recent consolidation of several different water agencies into a new agency, the SCVWA, has
transformed the landscape of water agencies in the Santa Clarita Valley. The Castaic Lake
Water Agency was formed, originally, as a wholesale water provider; as a State Water Project
(SWP) member, it delivered wholesale water to several retail water providers (the Los Angeles
County Waterworks District #36, Val Verde; the Newhall County Water District; the Santa
Clarita Water Company; and the Valencia Water Company). In short, these agencies served
separate and distinct roles. Under that structure, the LACWWD #36 was a retail provider, and
the former CLWA was primarily a wholesale provider (although CLWA had purchased two retail
water providers, its retail water service territory was geographically limited).
With the recent consolidation, the SCVWA now provides both wholesale water and retail water
service throughout most of the Santa Clarita Valley. Because SCVWA sells wholesale water to
LACWWD #36, its (LACWWD #36) service territory is also within the SCVWA Agency
jurisdictional boundary. In that regard, there now exists two agencies with overlapping
boundaries, and both that can provide retail water.
In terms of representation, LACWWD #36 has a representative who serves on the SCVWA Board
of Directors, appointed by the Los Angeles County Board of Supervisors. According to SB 634
(Wilk), that Board position will be eliminated on January 1, 2023. However, as mentioned
previously, the territory served by the LACWWD #36 is also within the boundaries of the
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Municipal Service Review Recommendations
SCVWA and is within the 3rd Electoral Division. In that regard, residents within the current
boundary of LACWWD #36 are able to vote for elected representatives to the SCVWA Board,
and these residents would continue to do so if a consolidation of LACWWD #36 and SCVWA
went forward.
As documented in this MSR, the SCVWA has demonstrated that it has ample water supply to
address the demand from existing customers within the boundaries of LACWWD #36
(approximately 1,350 service connections). Should LACWWD #36 and SCVWA representatives
be open to exploring a potential consolidation SB 634 (Wilk) requires the mutual agreement of
both agencies and that the consolidation must go through LAFCO. It is recommended that an
analysis be performed to evaluate cost savings due to economies of scale and reduction in
administrative costs.
The 10 mutual water companies identified in Exhibit 1-2 are non-profit corporations that
provide potable water to their shareholders. All 10 are within the Agency boundaries. They
receive wholesale water from the Agency which they then sell to their shareholders. As private
companies, much of their financial information is not readily available. It is difficult to assess
their ability to provide services. The assumption is that they are providing adequate services.
Therefore, it is not recommended to transfer the provision of potable water services unless the
mutual company or its shareholders request SCVWA to provide the service.
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Municipal Service Review Summary of Determinations
SUMMARY OF DETERMINATIONS
Population Projections
Current population of the Agency is estimated at 273,000.
It is estimated there will be a slower growth rate than in recent history of about 2% per
year through 2035. The 2015 UWMP estimates growth in the service area to a population
of 396,100 by 2040.
Disadvantaged Unincorporated Communities
In 2018, 80% of the statewide annual median household income was $56,982. There
are two DUCs identified in Exhibit 4-1. One area was identified as a DUC that met the
income requirement in the vicinity of Canyon Country adjacent to the City of Santa
Clarita, but within Agency boundaries. There is a second DUC along the southeast
boundary of the Agency. Part of the area is within SCVWA and the remaining portion is
adjacent and beyond the he SOI. Both areas are likely to receive water from SCVWA or
from private wells in areas outside the Agency. They receive fire protection from Los
Angeles County Fire Department, and sewer service from Santa Clarita Valley Sanitation
District of Los Angeles County.
Present and Planned Capacity of Public Facilities
As a wholesale and retail agency, SCVWA supplies come from SWP water (wholesale),
groundwater, banked water, and recycled water.
SCVWA operates two water treatment plants with a combined capacity of 112 mgd and a
separate perchlorate treatment facility for Saugus Formation wells that has a capacity of 3
mgd. PFAS have been detected in the well system. There is a possibility that 18 wells may
have PFAS that will require a response. SCVWA is in the process of building a treatment
facility for PFAS that is scheduled for completion in July of 2020.
Combined treated water storage of SCVWA totals approximately 204 mg of water in 99
storage facilities/tanks, which can be gravity fed to Valley businesses and residences, even
if there is a power outage. The system includes 64 pumping facilities/pump stations
delivering water through 861 miles of pipe ranging from 2 to 102-inches in diameter.
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SCVWA receives wholesale water from the State Department of Water Resources via the
State Aqueduct system under a long-term contract through the Castaic Reservoir. In
addition, it has a contract for raw water with the Buena Vista Water Storage District and
the Rosedale-Rio Bravo Water Storage District for up to 11,000 AFY for 30 years through
2036 and may be extended.
SCVWA supplies include groundwater from 47 wells in the Alluvial and Saugus Formation.
The 47 wells are capable of pumping 77,820 gpm, a maximum capacity of 125,505 AF,
39,040 AF in a normal year and 58,830 AF in a dry year. Currently 41 wells are operational.
Other sources such as banking (10,000 AF), recycled (450 AF), and imported water (75,387
AF) provide nearly another 100,000 AF. Total available supply will be approximately
200,000 AF by 2050 while demand rises from 57,000 AF in 2015 to a projected 93,900 AF
in 2050. Thus, SCVWA has and is projected to have ample capacity through 2050.
Wastewater treatment is provided by the Santa Clarita Valley Sanitation District of Los
Angeles County. However, SCVWA does provide wastewater collection services, but no
treatment, within a portion of what was the NCWD. At the time of SCVWA consolidation,
NCWD was in the process of transferring that responsibility to the City of Santa Clarita.
The Agency is continuing to move forward with the goal to transfer those responsibilities
to the City. Currently, SCVWA is working with the Spring Canyon Development, the City of
Santa Clarita, and the County of Los Angeles to identify improvements necessary to the
existing sewage lift station and force main to allow for transfer to the City. SCVWA is also
working on completing the transfer of the last section, Sand Canyon Road to the Vista
Canyon, through grant funding.
Financial Ability to Provide Service
The SCVWA adopts a two-year budget and recently adopted a balanced budget for FY
2019-20 and FY 2020-21. The Agency anticipates spending approximately $159 million in
FY 2019-20 and approximately $172 million in FY 2020-21. For FY 2018-19, the Agency
anticipates $131 million in expenses offset by $155 million in revenues.
The Agency recently completed its first full year audit of the consolidated agency. The
largest expense is depreciation and amortization. This exhibit shows sources of water
supply and the purchase of water from SWP are some of the largest expenses. Agency-
wide interest expense and administration are 12% and 14%, respectively.
Reviewing revenues and expenses for the divisions shows the largest source of revenues
for the Regional Division is property tax, while the largest source for retail divisions is
water sales, as expected. The source of water is a large portion of expenses for all
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Summary of Determinations
divisions. Also noteworthy is the high percentage of Valencia and Newhall administrative
expenses. The Agency has determined those costs are due to the way the financial
system, used by VWC and NCWD prior to Agency formation, tracks expenses. The Agency
is working to update its financial system which should resolve the problem.
Total debt of the consolidated agency includes Certificates of Participation (COPs) and
Revenue Bonds and the VWD Acquisition Loan for a total outstanding principal of $389
million as of June 30, 2019. The Agency plans to pay down the debt by approximately
$36 million each year over the next two years.
Water rates were set according to studies completed before consolidation. Ratepayers
pay a base rate plus a commodity charge per one hundred cubic feet or CCF. Each retail
agency has a different rate.
In 2016, the Santa Clarita Water Division contracted for a capacity fee study. The
approach allowed for new development to buy into existing facilities as well as to fund
new facilities required by the development. In 2018, SCVWA adopted a regional capacity
fee schedule for each area of the agency. The updated single-family residence capacity fee,
for a ¾ inch meter, ranges from $5,800 to $10,900 depending on the area.
The Agency has a Capital Improvement Plan. Regional projects are funded by the Capital
Project Fund and property tax revenues. Retail projects are funded by water rates,
reserves, and connection fees. The adopted budget indicated the Agency expects to fund
$41.9 million for regional and $16.5 million for retail divisions. In the revised FY 2020/21
budget funding was increased to $67.1 million for regional and $45.7 for retail system
projects.
SCVWA is guided by its financial policies when developing a budget. Policies include its
Investment Policy, Debt Management Policy, Disclosure Procedure Policy, Derivatives
Policy, Purchasing Policy, Capitalization Policy, Wire Transfer Policy and Reserve Funds
Policy. The Agency has sufficient reserves for 1,231 days for the Regional Division and 274
days for the retail divisions.
In February of 2020, the Agency made a payment of $5,034,331 so that OPEB is up to
date. Each year the budget allocates a prepayment to keep the total over time up to
date.
The SCVWA has sufficient revenues and reserves to provide services
Status and Opportunities for Shared Facilities
The Agency projects savings of nearly $20 million by the end of FY 2020-21 due to the
consolidation and economies of scale.
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Municipal Service Review Summary of Determinations
The Agency participates in several JPA’s that allow it to share costs with other agencies
and improve service. They range from the State Water Project Contractors Authority to
the GSA to the ACWA/JPIA, which allows the Agency to realize savings in insurance costs.
Management efficiencies are often measured by whether the Agency has planning
activities both long-range and short-range. The Agency has demonstrated management
efficiencies by several planning tools ranging from its two-year budget, its capital
improvement and asset management plan to its five-year strategic plan.
Accountability and Governance
The Agency is governed by a 12-member Board of Directors representing its three retail
divisions. The Board includes one appointed member representing LACWWD #36. The
LACWWD #36 seat expires in 2023 (SB 634 10(c)). Eventually the 12 members will be
reduced to nine members, due to attrition. Board members receive $228.15 in
compensation for each day of service for up to 10 days per month.
The SCVWA Board of Directors meetings are held the first and third Tuesdays of each
month at 6:30 p.m. Meetings are held at SCVWA headquarters at 27234 Bouquet Canyon
Rd, Santa Clarita, CA 91350. Meetings are held in accordance with the Brown Act.
The CLWA acquired 90% of the Devil’s Den Water District in 1988 as part of the purchase
of Producers Cotton Oil Company. CLWA subsequently received the SWP’s allocation to
Devil’s Den Water District. The Devil’s Den Water District is a California Water District and
a landowner voter district. As the landowner of 90% of the District, former CLWA and now
SCVWA directors serve as the governing board for Devil’s Den Water District.
The consolidated Agency initially had a staff of 223 from the four agencies. In its revision
of the FY 2020-21 budget the Board reduced staff to 220.
The Agency maintains a website that provides information to the public on a number of
issues including, water conservation, governance, water quality, and the learning center.
The Agency publishes and distributes an e-newsletter, (Water Currents). The newsletter is
published monthly and provides residents with information on activities of the Agency.
Matters related to Effective or Efficient Service Delivery, as Required by Commission Policy
The Agency’s operations must address LA LAFCO’s approved conditions pertaining to the
formation of the Agency. LA LAFCO adopted 22 conditions. To date, the Agency has
complied with 20 of them. The Agency has been working with LA LAFCO cooperatively on
the remaining conditions.
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LA LAFCO – Santa Clarita Valley Water Agency
Municipal Service Review Summary of Determinations
The LA LAFCO Sphere of Influence for a coterminous sphere applies to SCVWA. The
Agency’s operations are consistent with the Coterminous SOI adopted by the Commission
on April 11, 2018. The sole exception is where the Agency provides service to a portion of
the former VWC territory which is outside the Agency’s existing jurisdictional and SOI
boundary. SCVWA has submitted an annexation proposal for the territory to LA LAFCO
which will be considered in late 2020 or early 2021. In this regard the Agency is providing
effective efficient services, as required by the Commission’s SOI Policy.
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Municipal Service Review Summary of Determination
REFERENCES
Castaic Lake Water Agency. 2003. Groundwater Management Plan Santa Clara River Valley
Groundwater Basin, East Sub-basin Los Angeles County, California. December.
Castaic Lake Water Agency. 2013. Santa Clarita Water Division Preliminary FY 2014/15 Budget.
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Castaic Lake Water Agency. 2014. Castaic Lake Water Agency FY 2014/15 Budget. July 1.
Castaic Lake Water Agency. 2015a. Castaic Lake Water Agency FY 2015/16 Budget. July 1.
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July 1.
Castaic Lake Water Agency. 2015c. Castaic Lake Water Agency Santa Clarita, California
Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2015.
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Castaic Lake Water Agency. 2016c. Castaic Lake Water Agency Santa Clarita, California
Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2016.
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2017/18 Budget. July 1.
Castaic Lake Water Agency. 2017b. Castaic Lake Water Agency Santa Clarita, California
Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2017.
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City of Santa Clarita. 2020. City of Santa Clarita Subdivision Activity Map February 2014.
Website: https://www.santa-clarita.com/home/showdocument?id=2314 Accessed
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Cole, Steve.2020.Personal Communication: email. March 18.
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Department of Water Resources. 2016. Bulletin 118 Interim Update 2016 California’s
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Henderson, Mike.2020.Personal Communication: email. May 15.
Kennedy/Jenks Consultants, 2016. Castaic Admin Draft Lake Water Agency Recycled Water
Master Plan. April.
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Municipal Service Review Summary of Determination
Kennedy/Jenks Consultants. 2017. Final 2015 Urban Water Management Plan for Santa Clarita
Valley. June 6.
LA LAFCO.2020a. Website: http://lalafco.org/Policies/SOI%20Policy%2011-13-2019.pdf .
Accessed January 28.
LA LAFCO.2020b. Mike Henderson Personal Communication Email: February 27.
Los Angeles County Department of Regional Planning. 2007. Notice of Preparation and Scoping
Meeting Notification Tapia Ranch. August 29.
Los Angeles County Department of Regional Planning. 2012. Los Angeles County General Plan.
Santa Clarita Valley Area Plan Land Use Policy Map. February.
Luhdorff & Scalmanini, Consulting Engineers and GSI Water Solutions. 2009. Analysis of
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Martin, Kathie. 2019. Personal communication email. December 30.
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Newhall County Water District. 2015a. Update Report on Revenue Requirements & Water
Rates. April.
Newhall County Water District. 2015b. Operating & Capital Budget Fiscal Year 2016.June 15.
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Ended June 30, 2015. November 12.
Newhall County Water District. 2016a.Operating & Capital Budget Fiscal Year 2017.May 12.
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Ended June 30, 2016. November 10.
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Petersen, Kenneth, Johnson, Beverly, Garon, John. 2017. Valencia Water Company Cost of
Service Study 2018-2020. September.
Raftalis. 2016.Santa Clarita Water Division Capacity Fee Study Report. June 20.
Raftelis Financial Consultants, Inc. 2016. Castaic Lake Water Agency Financial Plan and Rate
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Raftelis Financial Consultants, Inc. 2017. Santa Clarita Water Division Retail Water Rate Cost of
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SCVNews. 2020. Water Officials Ink Devil’s Den Deal. June 2, 2011 Website:
www.SCVNews.com. Accessed February 28.
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Municipal Service Review Summary of Determination
SCVWater. 2006. Joint Powers Agreement State Water Project Contractors Authority.
February 14.
SCVWA .2018a. SCV Water Plan for Services. January.
SCVWA. 2018b. Santa Clarita Valley Water Agency Capitalization Policy for Fixed Assets. May.
SCVWA 2018c. SCV Water Budget FY 2018/2019, June 5.
SCVWA 2018d. SCV Water Regional Facility Capacity Fees 2018. July 18.
SCVWA. 2019a. Santa Clarity Valley Water Agency Annual Financial Report for the Six Month
Period Ended June 30, 2018, March 18.
SCVWA. 2019b. SCV Water Biennial Budget FY 2019-20 and FY 2020-21. May 21. SCVWA 2020.
Website: https://yourscvwater.com/rates/ Accessed 1/19/20.
SCVWA. 2019c. 2019 Santa Clarita Valley Water Agency 5-Year Strategic Plan. September.
SCVWA.2019d.Mona Restivo SCVWA. Personal Communication: email November 2, 2015.
October 16.
SCVWA 2019e. MSR Response Spreadsheet. October 31.
SCVWA. 2019f. Water Currents. November.
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December 17.
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to Protect Public Health. Press Release. February 10.
SCVWA. 2020c. Compensation and Benefits. Website:
https://yourscvwater.com/governance/#bod Accessed February 13.
SCVWA.2020d.2019 Water Quality Report. Website: https//www.
https://yourscvwater.com/wp-content/uploads/2019/06/2019-SCV-Water-Quality-
Report.pdf February 19.
SCVWA.2020e.Santa Clarita Valley Water Agency Annual Financial Report for the Year Ended
June 30, 2019. March 6.
SCVWA.2020f.Board Memorandum Approve a Resolution Revising the FY 2020/21 Budget. June
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Valencia Water Company. 2015. Business Plan 2016.
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the Years Ended December 31, 2015 and 2014, and Independent Auditor’s Report. April 7.
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Municipal Service Review Summary of Determination
Valencia Water Company. 2017a. Valencia Water Company Financial Statements as of and for
the Years Ended December 31, 2016 and 2015, and Independent Auditor’s Report.
March 30.
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