Page 12 - Yucaipa Valley Water District

Workshop Memorandum No. 17-071 Page 2 of 30

On March 6, 2017, the Board of Directors of the San Gorognio Pass Water Agency voted 6-0 to
not proceed any further with the draft cooperative agreement. Instead, the San Gorgonio Pass
Water Agency created an ad hoc group of their elected officials to develop an agreement tht would
be presented to the elected officials of the Yucaipa Valley Water District at some future date.

On May 9, 2017, the District received a draft agreement from the San Gorgonio Pass Water
Agency related to the collection of a Facility Capacity Fee (see page 20 of 30). The District staff
is currenty reviewing this document with a recommendation to the Board of Directors.

The District staff remains cautiously optimistic that a solution to the lack of supplemental water
for the region will ultimately be achieved by the San Gorgonio Pass Water Agency. While the
board members, staff, and legal counsel from the San Gorgonio Pass Water Agency continue to
work on their version of a cooperative agreement, the District should establish a reasonable
methodology and adopt a fee structure that begins to collect funds for the purchase of
supplemental water in the form of permanent water rights.

At the board workshop on April 25, 2017, the District staff illustrated a sample methodology to
calculate the cost of a permanent supplemental water supplies using the nexus report prepared
by the San Gorgonio Pass Water Agency. Based on the proposed methodology, the District staff
drafted a proposed resolution to adopt the methodology and implement a new facility capacity fee
component for new homes in the Calimesa portion of our service area (see page 24 of 30).

Yucaipa Valley Water District - May 30, 2017 - Page 12 of 138