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California Water Plan Update 2018 January 9, 2018

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Water Plan Update 2018 Draft Reviewer’s Guide

January 9, 2018

This document is presented as a preliminary draft of a chapter of the California Water Plan Update 2018

document. Supporting information, details, data, and full references will also be documented and

available, but will not be contained in this document. Comments received on this draft by January 15,

2018, may be used to inform the February 2018 Public Review Draft of Update 2018.

How to Comment

Send comments to: [email protected]

Attn: Paul Massera

Fax: 916-651-9289

What to Review

The Publications staff has not yet fully edited content for grammar, punctuation, style, consistency,

accuracy, or other issues relating to readability or quality. The document will be edited for these issues

prior to the release of the Public Review Draft in February 2018. Recommendations for what to focus on

during this meeting are listed below.

Please focus on:

• Relevance and Effectiveness: Does the content speak to your constituents/members? Is the

information presented in a way that is useful to elected officials?

• Completeness of information: As a policy decision-support document, is all information present

that an average reader might need — and presented appropriately (Considering that all

supporting information not contained in the main document will be available along with the

publication)?

• Factual accuracy: Is anything in the text incorrect? Does any information need additional

attribution to a specific source?

• Logical consistency: Does the narrative build in a logical way and effectively tell the right story?

Please do not focus on:

• Grammar, punctuation, spelling, capitalization, or stylistic consistency (unless any of these

relates to clarity or factual accuracy).

• Margins, fonts, layout, spacing, etc. Formatting will be reviewed again during the copy-editing

phase after your comments have been incorporated.

• Clutter/wordiness/efficiency of text.

• Tone/voice consistency

mailto:[email protected]


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Chapter 1. Envisioning Water Resource Sustainability

For generations, the word “California” has represented much more than a place. To this day, it invokes

images of exceptionally satisfying ways of life and well-being coupled with enduring, world-class natural

resources. It has offered seemingly endless opportunity for recreation; diverse personal, professional,

and cultural fulfillment; and economic prosperity. The abundant ecosystems of its vast and varied

landscapes — from its southern deserts, to its fertile central valley, to its northern rivers — have

provided many of these opportunities and the state’s prosperity.

Yet today, the people and ecosystems of California are living a tale of two extremes — drought and

flood. The intensity of these extremes and their impacts is expected to increase over time because of

climate change and changes in land- and water-use patterns. As these trends worsen, California may no

longer provide the benefits, opportunities, or resources for which it has been known around the world.

Although all Californians must contribute to a sustainable future, water managers have significant

responsibility for ensuring that beneficial conditions and resources endure. Water managers also must

coordinate to ensure that the state is positioned to adapt to extreme events, and to reconcile repeated

negative impacts with current societal demands.

Since California Water Plan Update 2013 (Update 2013), extreme events and their consequences have

been experienced to varying degrees across the state. While nearly every Californian has been affected,

directly or indirectly, certain disadvantaged communities, often those least equipped to withstand

impacts, have borne the brunt. To help reduce the consequences of longer, deeper droughts and more

intense runoff, Californians must utilize and manage the state’s water resources by taking a more

holistic approach and keeping the long view in mind. Water users, planners, managers, and policy-

makers must collectively plan and manage California’s water systems proactively, to keep our water

systems resilient to changing conditions and able to adapt nimbly and dynamically to challenges. The

focus must shift from reactive, emergency responses stemming from extreme events to preparing for

such events in advance. Only proactive, strategic planning and adaptation at local, regional, and

statewide levels can secure a sustainable future for California.

California Water Plan Update 2018 (Update 2018) reaffirms the State’s commitment to an equitable,

sustainable future and describes how the State needs to support and empower local and regional

entities to make the vision of sustainable water resource management a reality.

Setting the Context for Update 2018 Since Update 2013, California has suffered through an unprecedented multi-year drought that

threatened the water supplies of communities and residents; decreased agricultural production in many

areas; worsened groundwater overdraft and subsidence that is affecting the integrity and security of

essential water, transportation, and other utility infrastructure; and harmed fish, animals, and their

ecosystems. The drought was followed by the wettest year on record, emergency incidents at the Lake


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Oroville spillway facilities, and flooding around the state. These events have called attention to the

vulnerability of the state’s aging flood and water management infrastructure.

Californians responded to these challenges by making substantive changes in water resource

management. These important initiatives, along with others, are steering California toward managing its

complex water systems more sustainably.

• On February 24, 2017, Governor Edmund G. Brown Jr. announced a four-point plan to bolster

dam safety and flood management: (1) invest $437 million in near-term flood management and

emergency response actions, totaling $50 billion over the next few decades; (2) require

emergency action plans and flood inundation maps for all dams; (3) enhance California’s

existing dam safety inspection program; and (4) seek prompt regulatory action and increased

funding from the federal government to improve dam safety.

• The California Water Action Plan (Water Action Plan), released by Governor Brown’s

administration in January 2014 and updated in January 2016, describes a set of essential actions

intended to “lay the foundation for sustainable water management in the coming decades”

(California Natural Resources Agency et al. 2016).

• The Sustainable Groundwater Management Act of 2014 (SGMA) set in motion a foundational

transformation of the governance, planning, and management of groundwater basins in

California. This significant new policy takes a long-term, outcome-driven approach to

groundwater management, and closes the loop on California’s water cycle. Inherent in this

approach is the understanding that it will take years to contribute toward sustainable

groundwater basins, and proactive management will need to continue for generations to keep

delivering the intended outcomes.

• Proposition 1 — the Water Quality, Supply, and Infrastructure Improvement Act of 2014 — was

passed by the voters in 2014 and made available $7.5 billion to finance safe drinking water and

water-supply reliability programs for California. The water bond provides public funding for

public benefits associated with new surface water and groundwater storage projects; regional

water-supply reliability; sustainable groundwater management and cleanup; water recycling;

flood management; water conservation; and safe drinking water, including specific allocation of

funds for disadvantaged communities. The overwhelming success of Proposition 1 at the polls

indicated that Californians are willing to invest in water management system improvements.

These important initiatives complement the significant physical improvements in water resource

systems and in system management over the past few decades, including substantial investments in

conservation, storage, and new water supply and conveyance. Yet, some Californians still face

unacceptable risks from flooding; unreliable or unsafe water supplies; and undesirable conditions from

groundwater overdraft, habitat degradation, and species declines. Many of California’s ecosystems have

become dysfunctional, and much of our water supply and flood protection infrastructure are no longer

functioning as intended or have exceeded their design life. Californians are still dependent on many

outdated World War II-era investments and innovations. If these trends continue, our future prosperity


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will be vulnerable to the consequences of such societal catastrophes as droughts, floods, fire,

environmental degradation, and species extinctions.

California’s systems for using and managing water are extremely complex and subject to continually

changing natural and human-made conditions. Moreover, water resources provide critical support for

the success of other dynamic systems: our ecosystems, social systems, and economic and market

systems. Because of this complexity, improving water management outcomes is complicated by several

key issues and challenges.

• In many parts of the state, people and property are still at risk for catastrophic flooding. One in

five Californians live in a floodplain, and more than $580 billion in assets (i.e., crops, property,

and public infrastructure) are at risk (California Department of Water Resources 2013 [Flood

Futures]).

• Californians living in poverty are experiencing water-related public health crises and have less

access to water-related enriching experiences.

• Ecosystems continue to decline, and several species are on the brink of extinction.

• Groundwater overdraft, lack of access to clean water in some communities, and unreliable

water supplies persist in some regions.

• Often, water management efforts focus on reactive or short-term actions without considering

how the actions might contribute to long-term desired outcomes, such as resiliency to changing

conditions and sustainability.

• Climate change is having a profound impact on California’s water resources, such as changes in

the timing and amount of snowpack, sea level, and river flows. The potential change in weather

patterns will exacerbate flood risks and add additional challenges for water supply reliability.

• The State of California has no durable process for prioritizing and funding public benefits and

local/regional assistance associated with water management and ecosystem protection.

These important challenges cannot be addressed by just tweaking the current system. Public policy must

move from stopgap measures to water resource strategies for the generations. This requires rigorous

tracking of effectiveness, learning from what works, and adapting ineffective practices and behaviors

expeditiously.

Managing Water Resources for Sustainability Update 2018 promotes a common understanding of what it means to manage and measure water

resources for sustainability. Sustainability should become the goal of every Californian because we all

benefit from the state’s natural resources. Sustainability is not an end point but an ongoing, resilient,

and dynamic balance between four societal values — public health and safety, a healthy economy,

ecosystem vitality, and opportunities for enriching experiences. Dynamic balancing is necessary because

the relative importance of societal values changes over time. Sustainably managing water resources

statewide, based on principles that support effective planning and foster trust, is an effective way to

dynamically balance basic societal values. (See “Sustainability Outlook: Guiding Principles for Balancing

the Four Societal Values” in Chapter 2.)


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Governor Brown’s Water Action Plan emphasizes the need to respond to changing conditions and

establishes three goals of “more reliable water supplies, the restoration of important species and

habitat, and a more resilient, sustainably managed water resource system (water supply, water quality,

flood protection, and environment) that can better withstand inevitable and unforeseen pressures in

the coming decades” (California Natural Resources Agency et al. 2016). Further, all the changes

mandated by SGMA are designed to support the more sustainable use of water.

Importance of State and Regional Alignment

Statewide sustainability is the aggregate of local conditions. To effectively and sustainably manage

water resources throughout the state, most of the work must happen at local and regional scales. The

value of regional management is that it utilizes a localized systems approach to planning, where multiple

objectives are considered and the net benefits and impacts on the region are evaluated. A primary focus

of Update 2018 is describing how State government can support and empower water planning and

management practices at the regional scale. Regional and local water agencies and organizations have

extensive knowledge of their watersheds, ecosystems, and groundwater basins, even as those regional

entities look to the State to fulfill its leadership role.

Given the complexity of the state’s water systems (e.g., watersheds, interregional infrastructure,

integrated regional water management [IRWM] and regional flood planning areas, groundwater

sustainability planning areas) and Californians’ strong emphasis on local control, the most effective

water management scale reflects local planning priorities and systemic conditions. State-regional

communication and engagement at this scale must be the root of any near-term management. It must

also serve as the foundation for any prospective changes to existing planning areas or alignment of

regional governance over the long term. Additionally, interactions among regions can increase mutual

benefits within California’s interconnected water resource systems. Effective regional water

management means that strategic planning occurs in an integrated manner across all relevant sectors of

water management and geographic scales.

Examples of various water sectors and existing planning scales that must be aligned include:

• Fish habitat and flood management at a watershed scale.

• Groundwater use and recharge at an aquifer scale.

• Terrestrial and migratory waterfowl habitat at an ecoregion scale.

• Land and water use at city, county, and water district scales.

• Statewide and interstate systems at interregional and interstate scales.

This sector/scale complexity and interconnectivity underscores the importance of IRWM, SGMA,

municipalities, and other local/regional entities to successfully align efforts at a hydrologically based

scale (watershed). The determination of the appropriate geographic scale should consider the

interdependent physical (especially hydrologic), biological, economic, and social processes and functions

within each basin. Currently, in many areas of the state, regional water management groups (RWMGs)

tend to be well-positioned to work with State government to align ongoing and near-term initiatives.

These groups are also well-positioned to collaboratively plan for long-term regional governance


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strategies. The lessons learned from IRWM, SGMA implementation, and other regional partnerships

must also be applied to effectively align planning and implementation at a watershed scale.

Long-term Vision and Priorities for Water Resource Sustainability Update 2018 provides a long-term vision that is aspirational and generational to inspire and guide future

policies and investments toward a common vision of California’s long-term water future. Managing for

sustainability means that water managers must invest in actions that meet today’s needs and societal

values, without compromising the long-term capacity of the water system to provide for future

generations and the natural environment. Water use and management of California’s water systems

require significant focus on actions and outcomes that support sustainability. The focus must shift

toward defining shared outcomes with clear intent and monitoring how, and to what extent, our actions

contribute to sustainability. Moving toward sustainability requires long-lasting commitment;

collaboration among State, federal, Tribal, and local agencies; and significant financial resources.

Update 2018 envisions all Californians benefitting from increasingly effective water policy and

investment rooted in what Californians value. Over the Update 2018 planning horizon (through 2050),

Californians experience less flooding, more-reliable water supplies, reduced groundwater depletion,

greater habitat and species resiliency, and other desirable conditions. These types of outcomes will

require innovative, foundational changes to the way decisions are made, water is regulated,

investments are funded, and progress is tracked.

In this vision of sustainable management, decisions are proactive and based on long-term planning.

Taking a long-term view, planners and managers synthesize and integrate plans and actions. They also

implement actions that are resilient to changing conditions. Water sustainability is more commonly

understood in terms of the four societal values (public health and safety, a healthy economy, ecosystem

vitality, and opportunities for enriching experiences). Water resource considerations are appropriately

integrated across all State and regional planning processes. Water management investment increasingly

results in desired outcomes that are well-articulated before implementation and tracked after

implementation. The funding needed by State government to fulfill its roles and responsibilities is more

stable, based on a State investment plan, and reflects shared intent between State government and

California’s diverse local governments.

Update 2018 aspires for a future where:

• All Californians are protected from health and safety threats and emergencies.

• California’s economy is healthy and all Californians will have opportunities for economic

prosperity.

• Ecosystems in the state are thriving.

• All Californians have opportunities for enriching experiences.

Update 2018 provides recommended State actions to address foundational gaps and urgent needs to

advance these five priorities of Update 2018:

1. Improve Alignment of Agencies’ Initiatives and Governance.


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2. Improve Regulatory Framework to Reconcile Environmental Needs and Human Activities.

3. Provide Resources, Knowledge, Skills, and Tools Water Managers Need for Data-Driven Decision-

Making.

4. Modernize and Rehabilitate Water Resource Management Systems.

5. Provide Sufficient and Sustainable Funding.

Improve Alignment — Shared intent is identified and governments are aligned behind regionally

appropriate investments. State government supports alignment and empowers local and regional water

management. State government ensures that regional entities have the incentives, knowledge, tools,

authority, and guidance to develop, implement, and enforce water resource management practices for

sustainability by:

• Assisting regional entities with building capacity to strengthen governance; establishing

collaborative management of resources; and providing regional government agencies the

necessary data, tools, models, and processes to conduct regional water sustainability

assessments.

• Providing technical and facilitation assistance to regions for sustainably managing water

resources at the proper scale, and identifying the types of investments and actions needed to

realize those desired changes.

• Ensuring assistance to under-represented and economically disadvantaged communities and

Tribes. These communities are fully embedded in regional water sustainability planning.

Traditional/Tribal ecological knowledge (TEK) is considered in watershed planning processes.

• Recognizing local knowledge and empowering local agencies to manage their water resource

sustainably.

Improve Regulation — More cost-effective and successful delivery of intended benefits and services are

occurring. Restored ecosystems, enhanced water reliability, and reduced flood risk result from

regulations being tied to planning and long-term system management. Consistent with “Streamline and

Consolidate Permitting,” from Action 8 of the Governor’s Water Action Plan, a dialogue among federal,

Tribal, State, and local agencies results in reconciliation and alignment of various regulatory frameworks

and statutes. Regulatory incentives, discretion, and alternative compliance pathways are used to

accomplish intended outcomes. Reducing uncertainty in this way provides more incentive for

investment in built infrastructure (grey) and natural infrastructure (green), with the latter supporting

vital ecosystem services.

Provide Knowledge and Data — More productive policy conversations and shared understanding are

occurring. Local, regional, and State governments use a consistent and comprehensive method for

assessing sustainability and tracking the effectiveness of policy and investment. Information and data

gaps are significantly reduced, thus increasing desired outcomes and return on investments. State

government is equipped to provide stewardship of public funding and consistently reports return on

investment.

Modernize Water Management Systems — All Californians enjoy the benefits of increases in water

supply reliability, more abundant and sustainable nature resources, and improved health and safety


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when ecosystems and infrastructure are functioning and sustainable. This is accomplished by assessing

and prioritizing restoration and rehabilitation needs, and then investing in a manner consistent with

priorities. Water resource infrastructure is maintained, rehabilitated, or modernized to perform

effectively. Such structures are more resistant to impacts from inter-annual hydrologic variability and

other uncertainties.

Provide Funding — Sufficient and stable funding sustains public benefits from past investments by

maintaining and modernizing infrastructure. Sufficient funding for data, planning, regulation,

governance, and technologies helps achieve the desired outcomes of future water policy and

investment. It includes public cost-share for rehabilitation, modernization, and operations and

maintenance of water resource management systems.

Implementing actions based on these priorities sets the stage for Californians to enjoy a more

sustainable water future through 2050 and beyond.

Leveraging Accomplishments and Delivering on Commitments Building on accomplishments and delivering on commitments is a fundamental planning strategy of

Update 2018. Building on collaborative accomplishments is the most direct strategy for helping to

ensure consistency, efficiency, and ultimately effectiveness of water policy and investment. Adhering to,

and delivering on, commitments, such as the recommendations in Update 2013 or sustaining

engagement with local and regional partners, is the most direct strategy for maintaining trust and

building on investments in time and relationships. It also minimizes stranded investment resulting from

abrupt changes in direction, or abandonment of existing partnerships and governance structures.

Delivering on commitments is the best way to earn and sustain the trust necessary for fruitful

partnerships — the foundation of integrated water management.

Update 2018 is the twelfth in a series of California Water Plans prepared since 1957. Update 2018 builds

on Update 2013, which was encyclopedic in its coverage of water management in California. At more

than 3,500 pages, Update 2013 covered a variety of information, from detailed descriptions of current

and potential regional and statewide water conditions, to a detailed “Roadmap For Action” that

identified potential actions to support 17 objectives. Update 2013 also included detailed reports on each

of California's hydrologic regions and overlay areas. Those “state of the region” reports focused on

watersheds, groundwater aquifers, ecosystems, floods, climate, demographics, land use, water supplies

and uses, and governance. Update 2013 provided an integrated water management toolbox in the form

of more than 30 resource management strategies. Discussed were strategies to reduce water demand,

increase water supply, improve water quality, practice resource stewardship, improve flood

management, and recognize people’s relationship to water.

The comprehensive, detailed nature of Update 2013 informs Update 2018’s more concise call for

collaborative, integrated action. Specifically, Update 2018 frames the State of California’s need for:

• More inclusive, integrated, and aligned water planning processes to prioritize and fund long-

term, sustainable State/public investment in water resource management.


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• Consistent, timely, and practical ways to measure progress and return on public investments

over the long term.

• Effective water resource management as an ongoing activity that is continuously evaluated

using a cyclic planning and implementation process of:

o Setting shared intent/outcomes.

o Assessing past gains and deficiencies.

o Taking action.

o Measuring effectiveness.

o Adapting as needed.

o Repeating the cycle.

Update 2018’s approach to managing California’s water resources more sustainably will require time

and increased rigor in tracking effectiveness, learning from what is working, and nimbly adapting based

on lessons learned.

Successive Water Plan updates will build on Update 2018 by periodically reevaluating the intended

outcomes, consistently tracking and reporting on the effectiveness of public and private investments,

and revising and refining State policies and investment priorities. This will include conducting annual

assessments of the water management system and the actions taken to support managing water

resources for sustainability. It will provide the water community the opportunity to adjust course if the

intended outcomes are not being achieved by past investments and actions.

In this era of two extremes — drought and flood — the word “California” must continue to signify the

promise of satisfying ways of life, well-being, and enduring natural resources. Whether the state

effectively adapts to and even reduces these extremes will depend on the choices all Californians make.

The recommended actions, funding mechanisms, and implementation plan presented in Update 2018

are intended to guide these choices.


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Chapter 2. Sustainability Outlook

Managing water for sustainability is critical to dynamically balancing four societal values — public health

and safety, healthy economy, ecosystem vitality, and enriching experiences. It is about being mindful of

not wasting water, and as complex as predicting and planning for the next drought or flood. On a daily

basis, every Californian is responsible for doing their part. But how can Californians know how well they

are doing, whether their actions are moving the state in the right direction?

One basic long-standing challenge to water resource resilience and reliability in California is the lack of a

consistent and practical method for assessing current and future sustainability. Productive conversations

and planning for sustainability require a mutual understanding of resource limitations, management

deficiencies, and shared intent in identifying policy priorities.

California Water Plan Update 2018 (Update 2018) presents a major improvement in the way water

policy and management priorities can be developed and coordinated at local, regional, and State levels.

The Sustainability Outlook, described in this chapter, provides a well-organized and consistent approach.

When applied at a watershed scale, the Sustainability Outlook can increase the effectiveness of State

water policies and investments. This chapter underscores the urgency and rationale for “Actions for

Sustainability” (Chapter 3), as well as the importance of follow-through by those who would implement

those actions, as identified in “Implementation Plan and Funding Options” (Chapter 5).

Update 2018 advocates that managing for sustainability needs to be rooted in those things Californians

value. Through the lens of the four societal values, the Sustainability Outlook will help identify desired

water management outcomes and indicators that can be used to gauge current status and progress

toward sustainability. Because sustainability is not something achieved once and forever, the

Sustainability Outlook will help water resource managers adapt to changing circumstances and lessons

learned. Early implementation of the Sustainability Outlook means looking back at recommended

actions in California Water Plan Update 2013 (Update 2013) to assess what has been accomplished and

make the adjustments necessary to move toward a sustainable future.

Water Management in California Today California has always been a land of extreme diversity and variability. Today, a changing climate,

changing societal values and priorities, and many geophysical and socio-economic factors are

exacerbating that variability and heightening uncertainty. Effective integrated water management

(IWM) planning and implementation can reduce variability and uncertainty pertaining to water supply,

ecosystems, and public safety. This section provides a description of the geophysical and water use

conditions that affect water resource management and IWM planning.

Mandated State Responsibilities

State government water policy and responsibilities have evolved as decision-makers gained a more holistic understanding of water, ecosystems, and the impacts of past actions (and inaction) on those resources. The State’s roles and responsibilities are outlined in the State Constitution and case law; codified in statutes, such as the California Water Code; specified through regulations and contractual obligations, such as State Water Project contracts; and


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articulated through other types of policies, proclamations, and mandates. To begin building a complete and common understanding of the culmination of current State responsibilities, Update 2018 includes an inventory of all existing State government water-related obligations and mandates. Table 2-1 summarizes these responsibilities and their estimated cost ranges.

The inventory illustrates the framework under which State government currently supports statewide water resources sustainability. It will be used to help identify opportunities to improve effectiveness and efficiency. For example, various mandates have required the State to implement an overly limited scope of solutions or to rigidly enforce statutes rather than focus on achieving desirable outcomes. Update 2018 promotes a more holistic and flexible, as well as long-term, approach to State water policy and investment. State mandates must be reviewed, aligned, and adjusted to effectively adapt to a dynamic water resource environment. This inventory provides basic data, and through the Sustainability Outlook, provides a method for articulating the need to update or remove State mandates. A recommendation to evaluate the necessity and efficacy of existing mandates is presented in Chapter 3.

[Table 2-1. Insert inventory of existing statutory, contractual, constitutional and other mandated State government responsibilities and a range of costs.]

California Water Resource Conditions and Infrastructure

Precipitation, specifically snowpack and snowmelt from the High Sierra, is the primary source of water

supply in California, though it varies from place to place, season to season, year to year. The timing,

quantity, and location of precipitation in California are largely misaligned with agricultural and urban

water uses. Efforts to align the timing, quantity, and location with those uses have contributed to

California’s growth and unintended ecosystem degradation. In any given year, the state can experience

extreme hydrologic events: In times of drought there is not enough water to meet all uses, and during

floods the excess of water threatens human lives, property, and economic well-being. In both cases, the

crafting of effective policy and regulations has required regular updates of place-specific information

and tradeoff analyses, as well as adaptive decision-making.

The 20th century was marked by the development of infrastructure, institutions, and regulations to

manage the disparities between precipitation in the winter and lack of precipitation in the summer, as

well as the geographic disparity between water availability and water demands. State, federal, and local

agencies vastly expanded the state's system of reservoirs, canals, pumps, and pipelines to capture and

move water when it was available, store it for when it was not, and deliver it to agricultural and urban

users. Significant investments were also made in the state's flood protection system, including levees

and bypasses. Because of these infrastructure improvements, California’s water systems have

increasingly served multiple purposes, and today they provide an array of benefits to the state and its

people. Yet, in many cases, the improvements resulted in unintended consequences to the natural

environment.

Water Supply Reliability. The state relies on its watersheds and groundwater basins to provide clean

and sufficient water supplies. Healthy surface water and groundwater are essential to public health and


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safety, California’s ecosystems and economic future, and enriching experiences. Surface water and

groundwater have largely been managed as separate resources when they are, in fact, a highly

interdependent system of watersheds and groundwater basins. This historical separation in managing

these resources has resulted in negative effects across the four societal values and missed opportunities

to progress toward sustainability.

There have been significant investments made in local water-supply projects, including water recycling

and desalination. Recycled water and desalination, which were once cost prohibitive, are now becoming

more viable sources. Consistent with integrated regional water management planning principles and the

Governor Brown’s California Water Action Plan, local projects have helped increase regional self-reliance

and resiliency. That said, hundreds of thousands of Californians living in disadvantaged communities still

do not have secure or clean water for their households.

The statewide water balance (Figure 2-1) demonstrates the state’s variable water use and water supply

in the face of annual hydrologic extremes. Water uses depict how applied water was used by urban and

agricultural sectors and dedicated to the environment. Water supplies depict where the water came

from each year to meet those uses.

[Figure 2-1. California Water Balance by Water Year, 2005–2015]

Environment and Ecosystems. In addition to managing water resources for domestic, industrial, and

agricultural uses, California’s water is also managed for the needs of the environment and its

ecosystems. Healthy ecosystems and watersheds provide benefits to the people of California, such as

better air quality, enriching recreational opportunities, flood attenuation, groundwater recharge, and

natural water filtration. Although a significant amount of water is needed to maintain and restore

aquatic and riparian ecosystems, the current required flows for ecosystem needs are sometimes

insufficient to prevent negative impacts on the environment. Studies of the streamflow requirements of

aquatic life, mainly represented by salmon, reveal that flows in many California rivers and streams too

often fall below minimum desirable levels (California Department of Water Resources 2013).

Fish species in California’s waterways have generally declined over time in response to changing habitat

and flows, as well as from planned and accidental introductions of non-native species. As an example, of

the more than 50 species of fish in the Sacramento-San Joaquin Delta (Delta) today, more than half,

including the most successful, are non-native (Delta Stewardship Council 2013). Climate change will

exacerbate these issues in the long term, and native species may be disproportionately affected (Moyle

et al. 2012).

Flooding. California is at risk for catastrophic flooding that has wide-ranging impacts because of the size

of its economy and the number of people residing in flood-prone areas of the state. Flooding occurs in

all regions of the state, in different forms and at different times. Every county in California has been

declared a federal disaster area for a flooding event at least once in the last 20 years. On the other hand,

flooding in California can produce beneficial effects and support natural functions (e.g., replenishing

ecosystems with sediment and nutrients, and helping to recharge groundwater aquifers). Flooding and

floodplains also can provide beneficial habitat conditions; however, as people and structures have


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moved into floodplains, the need for flood management for all beneficial uses — people and the

environment — has increased greatly.

Water Quality. Changes in land and water use have resulted in increased runoff of agricultural,

industrial, and urban pollutants to surface water and groundwater. Increased agricultural and urban

wastewater discharges, as well as changes in commercial and recreational activities, have negatively

affected water quality. Higher temperatures, increasing rainfall, wildfire and forest management

practices, and ecosystem degradation have further diminished water quality. As water quality

diminishes, the cost of treating it to drinking water standards increases.

Water and People. Federal agencies manage approximately 47 percent of California’s 100 million-plus

acres. The U.S. Department of Agriculture Forest Service is the largest public land manager in the state.

Federal- and State-owned lands, combined with other areas, such as the Delta and coastal lands, offer

numerous opportunities for water-related recreational activities (e.g., camping, boating, fishing, hiking,

birding, hunting). In addition, all California Native American Tribes and Tribal communities, have distinct

cultural and spiritual practices, as well as environmental, economic, and public health interests, related

to water.

Historical Investment in Water Management

The average total historical investment in capital and ongoing expenditures by local, State, and federal

agencies have been approximately $30 billion per year from 2005 through 2015 (Figure 2-2). Capital

expenditures averaged approximately $5 billion per year during the same period, with the majority of

funds coming from local agencies. Capital expenditures have continued to be largely in reaction to

emergencies and extreme events (the increase in spending in the late 2000s for flood management was

in response to Hurricane Katrina, and the upward trend in spending starting in the mid-2010s was in

response to extended drought conditions). Most annual expenditures have been for ongoing needs and

have risen steadily since 2005, driven by an increase in administrative costs at the local agency level.

State and federal spending has remained low.

Local agencies provide about 85 percent of all funding for water management in California, with capital

and ongoing expenditures increasing to keep pace with the issuance of State grant programs. Although

the State has funded capital improvements in disadvantaged communities, those areas often lack the

ability to fund ongoing operations and maintenance. In addition, State expenditures from the General

Fund have decreased as bond issuance has increased. This shift has led to a reliance on bond funding for

water management, an unstable source that is subject to the public’s perceptions and priorities.


WORKING DRAFT 2-5

(a) Total Expenditures

(b) Capital Expenditures

(c) Ongoing Expenditures

Figure 2-X2. Historical Local, State, and Federal Expenditures (2005–2015)


WORKING DRAFT 2-6

California State Water Management Plans and Initiatives

California’s arid climate and history of drought and flood have prompted a variety of programs, actions,

and initiatives aimed at achieving greater water sustainability statewide. At the State level, a variety of

planning efforts, funding programs, regulatory reforms, and policy directives are helping to address key

water resource management concerns. Descriptions of these plans and initiatives are included in

Appendix <add #>.

Challenges to Sustainability

California has realized many successes in water resource management over the past several decades,

driven by State-level policy initiatives and programs, and local and regional actions. Nonetheless, strong

evidence of vulnerability of the state’s water resources is occurring in nearly all regions, and conflicts

between ecological and human needs are increasing. Climate change, demographic changes, and other

variables have underscored the need to improve the effectiveness of managing these valuable water

resources for sustainability. Just as important as understanding the challenges the state faces today, is

recognizing trends and the underlying causes of change. Doing so will allow all Californians to more

effectively collaborate on increasing resilience and recovering from unforeseen, disruptive events.

During the previous five years, California experienced severe drought accompanied by accelerated

groundwater depletion and overdraft; continued habitat and species declines; and economic hardship,

particularly in communities that rely on imported water supplies. This dry period was then followed by

the wettest year on record, with extreme hydrology causing catastrophic failure of some major

infrastructure. Those failures threatened the lives and property of people living behind levees, and

jeopardized Tribal cultural resources in many areas. Although some communities throughout California

showed great resilience under these adverse conditions, many communities were significantly affected

by these extreme hydrologic events. Communities without reserves of wealth often suffered the most

severe impacts.

California’s interconnected systems for using and managing water are extremely complex and subject to

continually changing natural and human-made conditions. Even with important statewide initiatives and

significant improvements in water resource systems and in system management over the past few

decades, California still faces unacceptable risks from both foreseeable and unanticipated threats to

water resource sustainability. Because our water resource system is complex, the dilemma of making

further improvements to support long-term sustainable management is complicated by several critical

gaps and urgent challenges.

Many challenges that regions and communities face are either foundational or more specific, even

critical. Whether foundational or critical, the challenges (described below) are interlinked: The critical

challenges cannot be adequately addressed unless stakeholders, water managers, legislators, and the

public address the foundational ones. While local, regional, and State water managers tackle these

challenges daily, they have varying degrees of control over them. What’s more, communities and

regions cannot efficiently or cost-effectively address these challenges on their own. The State must

empower community and regional entities to resolve these issues in a coordinated, collaborative, and

cost-effective way, such that the solutions provide broad public benefits.


WORKING DRAFT 2-7

Foundational Challenges

• Initiatives and Governance: The ability to efficiently and sustainably manage water resources at

a watershed scale is often impaired by lack of coordination and of alignment of water and land

management efforts among local, regional, State, and federal agencies and California Tribes.

Those efforts are sometimes inconsistent with current priorities related to dynamically

balancing societal values. Those striving to implement projects must navigate and comply with

California’s labyrinth of uncoordinated and at times conflicting laws, regulations, and

jurisdictions — all of which can lead to project delays and increased planning and compliance

costs. This is true for both small, relatively simple projects and large, statewide projects.

Efforts to effectively manage California natural resources will require unprecedented alignment

and cooperation among public agencies, Tribal entities, landowners, interest-based groups, and

other stakeholders. Better agency alignment of plans, policies, and regulations is needed to

improve and expedite implementation. Collaboration is required to prioritize actions and garner

enough community support for sustained investment.

• Regulatory Framework: Regulations are an integral and important part of water management.

The current regulatory framework does not readily allow for the reconciliation of both

environmental needs and human activities. It does not take a systems-oriented approach, and is

not directly tied to or informed by ongoing planning and implementation efforts.

A changing regulatory environment, combined with misaligned, complex, and often internally

inconsistent government planning and policies, poses challenges for sustainably managing water

resources and associated project development. This is further exacerbated by conflicting roles

and responsibilities and often overlapping or narrow State authorities and governance

structures. California’s diverse societal needs, priorities, and expectations — which evolve and

sometimes conflict with one another — pose another challenge to establishing consistent State

policy and directing funding where it is needed most.

• Capacity for Data-Driven Decision-Making: Water resource planners and managers often do not

have access to adequate technical information, tools, and facilitation services to support

regional efforts toward sustainable, integrated water management. Although this is a challenge

statewide, the consequences are evident in under-represented and economically disadvantaged

communities. For any given resource issue, data may be abundant statewide but are often

collected, used, and stored by the individual agencies and not coordinated or shared.

Data management, planning, policy-making, and regulation must occur in a collaborative,

regionally based manner. The ultimate product needs to be a composite of information and data

from a wide variety of elected officials, opinion leaders, stakeholders, scientists, and subject

experts. Sound outcomes rely on a blend of subject expertise and perspectives woven together

(e.g., hydrology, climatology, engineering, earth sciences) into comprehensive policies and

implementation decisions that are place-based and regionally appropriate.


WORKING DRAFT 2-8

• Infrastructure: Water- and flood-related infrastructure is increasingly not operated, maintained,

rehabilitated, or modernized to provide the intended outcomes.

Much of California’s water infrastructure is reaching the end of its design life. At the same time,

costly maintenance and capital improvements have been deferred in some regions because of

lack of funding or difficulty in meeting regulatory requirements. Combined with expected

changes in the state’s climate, supply disruptions caused by earthquakes and flooding are likely

to rise. This poses threats to public safety in terms of reduced water availability, degraded water

quality, and flooding.

• Funding: Current methods used to fund State government are often inadequate and too

unpredictable or inflexible to effectively fund all mandated State responsibilities (including local

assistance and cost-sharing). Many other factors, such as changing public priorities, responses to

declining ecosystems and catastrophic events, and deferred maintenance, have compounded

today’s State funding needs. Other challenges to sufficient and stable funding that occur at all

levels of government include competition for available resources with other public services,

dependence on per unit charges that reduces revenue collection during periods of required

conservation, legal constraints related to assessment increases (e.g., Proposition 218), and

geographical or jurisdictional limitations on use of funds.

Flood management and ecosystem management face additional funding challenges because

they rely heavily on State and federal funding. The State is also responsible for protecting public

trust assets and ensuring that communities with limited resources have safe, reliable, and clear

water supplies. Funding for these State responsibilities is also frequently inadequate and

unstable. For example, only 6 percent of total water resource funding is allocated to flood

management and ecosystem functions (Public Policy Institute of California 2012). Sporadic

funding that ebbs and flows with the occurrence of floods or droughts lacks the predictability

and reliability required for effective long-term change. At the same time, levels of general

obligation bond debt are near an all-time high.

Critical Challenges

• More extreme hydrologic events in the future: Severe drought conditions in the western

United States, followed by extreme precipitation in 2017, have directly affected the health, well-

being, and livelihoods of Californians. The wide swings in climatic conditions are exposing the

vulnerability of the state’s water systems and ecosystems. Seasonal, year-to-year, and

geographical variability among water sources and locations of water uses, particularly in

disadvantaged communities, is also a complicating factor.

• Reduced access to clean, safe, and affordable water supplies: During the recent drought, many

vulnerable communities were unable to provide stable, safe water supplies to their residents for

household use. Nearly 700 communities have water systems that, prior to any treatment, rely

on contaminated groundwater (State Water Resources Control Board 2013). Of the 3,399 public

water systems (community systems and schools) in the state, more than 300 of those water


WORKING DRAFT 2-9

systems are not in compliance with safe drinking water standards (State Water Resources

Control Board 2016), and many more lack access to affordable and reliable water supplies. This

often results from degraded surface water and groundwater quality. For example, the rise of

homelessness has led to homeless encampments along riverbanks and stormwater

management systems in many towns and cities, which has created additional challenges in

protecting river ecosystems and riverine water quality. To compound the situation, many

disadvantaged communities must dedicate an increased portion of their budgets to providing

human services, rather than to redevelopment of water infrastructure.

• Increasing demands for water: Future water-use scenarios published in Update 2013 show an

increase in urban water use ranging from 1 to 7 million acre-feet (af) by the year 2050

(depending on population growth.) The high end of this range is equivalent to twice the storage

capacity of Lake Oroville. Agricultural water-use scenarios show a decrease ranging from 2

million to 6 million af for the same planning horizon. California’s population is expected to

increase from 39.4 million in 2016 to 51.1 million by 2060 (California Department of Finance

2016). Many communities are at risk of having their residential supplies disrupted or

compromised in the future. This growth is likely to put more people at risk of flooding, while

also increasing demands for water. Improving conservation and water use efficiency, along with

shifts in agriculture to permanent crops, will make it more difficult to reduce consumption

during droughts and periods of low supply (i.e., demand hardening).

• Declining groundwater levels: Groundwater comprises nearly 40 percent of all water used in

California, totaling more than 16 million acre-feet per year (af/yr.). This is 2 million af more per

year than what is estimated to naturally recharge (i.e., groundwater overdraft). According to

California’s Groundwater Update 2013, net withdraws from Central Valley aquifers between

2005 and 2010 were as much as 13 million af. This is equivalent to nearly four times Lake

Oroville’s storage capacity. Driven by recent and extended drought, groundwater supplies in

some parts of the state are declining at even greater rates. The resulting decline in groundwater

levels has led to ground surface subsidence in some areas, resulting in costly damage to water

supply, transportation, and flood infrastructure. Even considering the recently implemented

Sustainable Groundwater Management Act (SGMA), it will take significant investment and time

to reverse historical groundwater lows and achieve more sustainable use of this critical

resource. SGMA requires the development of groundwater sustainability plans (GSPs) in high-

and medium-priority groundwater basins, which are prioritized by the percentage of total state

groundwater use and the percentage of overlying population in each basin. There are currently

43 basins classified as a high priority and 84 basins classified as a medium priority. Out of the

531 existing groundwater basins, these 127 basins combined account for approximately 93

percent of all groundwater used and support an overlying population that is approximately 88

percent of the total population in the state (see Figure 2-X).


WORKING DRAFT 2-10

• Declining ecological conditions: Even with the recent focus on the connection between water

and ecosystem health, much habitat remains disconnected from water supplies. Native species

continue to decline and many are vulnerable to climate change. More than 150 individual

species are listed as threatened or endangered in California (California Natural Diversity

Database 2017).

• Unstable regional economies: As water supplies have become less reliable, local and regional

economies are more volatile, especially in agricultural and rural communities. For example,

direct agricultural costs statewide from the drought total more than $1.8 billion, with a loss of


WORKING DRAFT 2-11

approximately 10,100 seasonal jobs (Howitt et al. 2015). Often these economic downturns

disproportionately harm people who have the least capacity to respond to changes.

These issues place significant risks on public safety, unique ecosystems, and the state’s economy.

Everyone in California is affected to some degree by these issues, and careful consideration of the risks

they pose is an important aspect of managing water resources for sustainability. Progress continues at

both the State and local levels, but these concerns are urgent and more needs to be done. In Chapter 3,

“Actions for Sustainability,” a number of strategies and actions, intended to address the significant

challenges described above, are organized into five categories (priority actions) and described.

Evaluating Water Resources Sustainability The Sustainability Outlook is a method of collecting, organizing, and standardizing data to evaluate the

status and trends of water resource conditions in terms of the four societal values.

The Sustainability Outlook will enable Californians to:

• Arrive at shared understanding of the statewide and regional water challenges and management

needs.

• Identify desired outcomes and indicators that can be used to gauge current status and progress

toward sustainability.

• Apply a single comprehensive and practical method for tracking and reporting on the

effectiveness of actions (e.g., investments, regulations, policies, projects) to achieve desired

outcomes.

The Sustainability Outlook is intended to present a snapshot of actual water and related resource

outcomes (where California stands today). Information in the Sustainability Outlook can be used by

individual Californians and water management decision-makers alike to foster greater understanding of

how we manage our water resources and better inform our individual and societal actions.

Sustainability Outlook: The Four Societal Values

Using the Sustainability Outlook, Californians can effectively support sustainability of water resources in

a coordinated, integrated way and achieve desired outcomes aligned with the four societal values.

Integral to the Sustainability Outlook is the underpinning principle of Social and Environmental Equity.

With this in mind, sustainable resource use and the resulting advancement of the societal values toward

sustainability must be well-thought-out, planned, and implemented in a way that provides for the basic

needs of all Californians and the environment. Each outcome, for each societal value, was heavily vetted

across multiple entities and stakeholders. This vetting was done to help ensure that, by achieving the

desired outcomes, the basic needs related to water resources will be met for all Californians and the

environment. Appendix <add #> provides more background on the importance of each societal value

listed below.

• Public Health and Safety.

o An adequate water supply for domestic needs, sanitation, and fire suppression.

o Reduced number of people exposed to waterborne health threats, such as contaminants or

infectious agents.


WORKING DRAFT 2-12

o Reduced loss of life, injuries, and health risks resulting from extreme hydrologic conditions,

catastrophic events, and/or system failures (including infrastructure).

• Healthy Economy.

o Reliable water supplies of suitable quality for a variety of productive uses, and productive

water uses are based on a reliable supply.

o Considerations of economic risks and rewards on floodplains, rivers, and coastal areas.

o More economic benefits from productive water uses.

o Reduced likelihood or occurrence of significant social disruption following a disaster.

• Ecosystem Vitality.

o Preserved or enhanced biodiversity throughout the state.

o Resilient and sustained high-quality natural resources and habitats.

• Enriching Experiences.

o Preserved or enhanced culturally or historically significant sites and communities, including

continued and improved access to water and land used for sacred ceremonies or practices.

o Preserved and larger natural areas with aesthetic or intrinsic value.

o Continued and improved access to resources that support education and learning.

o Continued or enhanced recreational opportunities in waterways, reservoirs, and natural and

open spaces.

Sustainability Outlook: Guiding Principles for Balancing the Four Societal Values

The guiding principles listed below describe how water and resource managers can balance the societal

values and thus better utilize the Sustainability Outlook to make decisions and do business. These

principles support effective planning by fostering trust through integrity, accuracy, transparency, and

proper use of information in decision-making.

• Manage California’s water resources and management systems through an ongoing, resilient,

and dynamic balance of four societal values.

• Apply California’s longstanding principles of reasonable use and public trust, as the foundation

for public policy-making, planning, and management decisions on California water resources.

• Promote environmental justice — the fair and equal treatment of people of all races, cultures,

and incomes.

• Help establish shared intent for sustainability with long-view perspective for water resources

management.

• Strengthen partnerships and help enhance governance to improve and align at all levels of

government for effective, integrated water resource management.

• Promote regional planning and resource management on a watershed scale to increase regional

self-reliance and effectiveness, and acknowledge each region’s unique perspectives, needs, and

priorities.

• Acknowledge future variability, risk and uncertainties, and cultivate learning and adaptation in

the decision-making process.


WORKING DRAFT 2-13

• Use science, best data, and local and traditional ecological knowledge in a transparent and

documented process.

• Invest with a long-term view toward substantial and predictable public funding to increase

system flexibility and resiliency.

Sustainability Outlook: Development Process

The Sustainability Outlook builds on existing and ongoing sustainability measurement efforts in the state

and nationwide. This includes sustainability assessment pilots conducted by DWR as part of Update

2013; watershed sustainability efforts by the State Water Resources Control Board; work by the

California Department of Fish and Wildlife as part of the State Wildlife Action Plan; and work by other

State agencies, non-governmental organizations, and academic institutions. DWR reviewed existing

sustainability efforts and conducted numerous meetings and workshops with State agencies and the

public to solicit input and feedback. This included identifying and proposing draft water-related

outcomes tied to the four societal values; identifying potential data sources and information that could

be used to assess sustainability; and considering different scales of application, from watershed to

statewide.

DWR initially envisioned the Sustainability Outlook being applied periodically, at a statewide scale, to

generate a simple “report card” for how well water was being sustainably managed in California. As the

department explored different methodologies and received feedback, the vision for the Sustainability

Outlook and its application evolved. During this process, DWR identified success criteria for the

Sustainability Outlook. The outlook must be:

• Easy to understand, for wide and timely adoption.

• Flexible, to allow for different conditions and issues in areas throughout this diverse state.

• Adaptable, for new requirements.

• Coordinated with, but not duplicative of, existing efforts.

• Able to account for data availability/accessibility and technical needs.

• Reasonable, implementable, and repeatable.

These criteria were foundational to the development of the process and approach described herein,

which now includes a basic method for assessing sustainability; a toolbox of data and information that

can be applied; and a plan to apply the method, over time, in individual watersheds throughout

California.

A detailed description of DWR’s process for developing the Sustainability Outlook — where it comes

from, where it currently stands, and where it is going — is included in Appendix <add #>.

Sustainability Outlook: Methodology

The Sustainability Outlook uses data (indicators) to help assess progress in achieving desired results

(intended outcomes) linked to the four societal values.


WORKING DRAFT 2-14

Intended outcomes articulate the desired results from managing California’s water resources in a

manner that balances the four societal values. For example, the outcomes related to the societal value

of Enriching Experiences consider the human relationship to water — in homes, in communities, and in

the environment. The outcomes related to Ecosystem Vitality consider three important facets of a

healthy and sustainable ecosystem: abundance, natural processes, and beneficial uses of water in the

environment. The intended outcomes are considered long term, but they may change over time. For

example, an outcome related to ecosystem vitality could continue to evolve as our understanding of

ecological systems and the processes that sustain healthy ecosystems grows.

Indicators are the data and information that are used to measure what progress has been made in

achieving the intended outcomes at a given point in time. California water management is complex and

the interlying regions are diverse. Large volumes of data are already being collected throughout the

state by local, regional, and State entities. Not all data are relevant to decision-making in all regions, and

it is neither practical nor necessary to use all available data to assess water management sustainability.

For these reasons, the Sustainability Outlook identifies a manageable set of indicators that apply

statewide and can be used to conduct watershed-scale sustainability assessments.

An example indicator for the intended outcome related to “exposure of people to waterborne health

threats” is the number of public water systems not in compliance with drinking water standards. These

are data currently collected by the State Water Resources Control Board, and they can be reliably and

repeatedly collected. When measured over time, and in combination with other indicators, they can

provide good insight into whether Californians are being exposed to waterborne health threats.

Societal Value Intended Outcome Example Indicator

Public Health and Safety Reduced number of people exposed to waterborne health threats, such as contaminants or infectious agents

Number of public water systems not in compliance with drinking water standards

Applied at the state level, indicators are intended to be broad and cover differing conditions (e.g.,

coastal and inland areas; north and south of, as well as in, the Delta). At a watershed level, indicators

will measure what is relevant to a specific area, which may or may not be the same as what is relevant

on a statewide basis (e.g., specific areas of the state where most of the population is not served by a


WORKING DRAFT 2-15

public water system; or flood safety improvements in upper watersheds, which would likely differ from

those in valleys). Indicators may change as the ability to collect and interpret data changes, the

conditions in the state and watersheds change, or the understanding of intended outcomes evolves.

In Update 2018, the Sustainability Outlook identifies the basics of how sustainability assessments will be

conducted at a watershed scale. Conducting the assessments at a watershed scale will more clearly

reveal trends, progress, and return on investment that would be difficult to discern at a statewide scale.

Doing so will also allow for the introduction of additional indicators important to specific regions of the

state. Through progressive application of the Sustainability Outlook, decision-makers will be able to

identify needed analytical tools and data, expand on the information available to make good decisions,

and build a common and transparent understanding of how individual and collective actions affect

sustainable management of water resources.

Piloting the Sustainability Outlook DWR is actively engaged in ongoing and upcoming pilot programs, and intends to demonstrate how the

Sustainability Outlook can be applied at a watershed scale. The goal is to measure progress and

effectiveness of recommended actions to support long-term water resource sustainability. DWR has

entered into partnerships, with California Forward and the Pacific Institute, to pilot the Sustainability

Outlook with two efforts at a watershed scale. The department also is working with the Water

Foundation to incorporate lessons learned from its recently completed Sustainability Water

Management Profile (SWM Profile) into those two pilots. It is anticipated each pilot study would use

indicators described in Appendix <add #> to measure the progress and effectiveness of recommended

actions for long-term water resource sustainability.

Sustainable Water Management Profile

In 2016, the Water Foundation partnered with the Inland Empire Utilities Agency to pilot development

of a SWM Profile, a mechanism to drive continual improvement toward long-term supply resilience and

water resource stewardship at a regional (or watershed) scale in California. This pilot SWM Profile

assessed how the water agency was performing by examining the water supplies upon which it directly

or indirectly relied. Using simple metrics, the SWM Profile identified the vulnerability of its water

systems to key stressors (also known as risks or threats) in the areas of environment, supply, demand,

and finance. The SWM Profile evaluated management responses to these stressors by both the water

agency and the broader region.

Russian River Watershed

The Russian River watershed was selected as pilot area because of established relationships, as well as

the innovative and participatory local entities with relatively few distinctive jurisdictions or agencies

compared with other watersheds in the state. Work will be performed in alignment with California

Forward’s and Sonoma County Water Agency’s sustainability planning when developing a framework for

defining sustainability outcomes and metrics, aligning regulatory processes to achieve sustainable

outcomes, improving governance and implementation efficiency, and identifying funding and finance

options and capacity across the four societal values. As planned, the work will apply the outcome-based

planning concepts advanced by the Water Plan at a watershed scale. Additional work under this pilot

will provide insight on policy development of watershed-based planning, regulation, governance, and

funding and finance innovations.


WORKING DRAFT 2-16

Multi-Benefit Investment Strategies Project, Santa Ana Watershed

In collaboration with the Pacific Institute, Santa Ana Watershed Protection Authority, and other

stakeholders in the watershed, this pilot project will develop a unifying framework for evaluating multi-

benefits as an outcome from water investment projects. The framework will facilitate development of

consistent tools that quantify benefits embedded in specific water projects, while providing flexible

application for a specific watershed, interest, or query. As planned, this pilot will work with both

technical and practical experts in multi-benefit valuation of water projects to be sure that the unifying

framework for evaluation of projects is useful and that there will be broad adoption. Overall, this project

will allow for a better comparison between integrated and traditional (single purpose) projects to

provide the necessary justification for cost-sharing among the beneficiaries of these projects.

Moving Forward to 2023 and Beyond The initial results of the pilot projects will be included in the final draft of Update 2018. Subsequent

results of the pilots will be used to test and refine the indicators, as well as the overall Sustainability

Outlook approach. DWR intends to work with regional water management groups and other partners to

develop appropriately scaled, watershed-based Sustainability Outlooks. Planning at a watershed scale

can help water managers evaluate and consider the interdependencies among physical, biological,

economic, and social processes, from headwaters to outlets, as well as interbasin interactions. It is

anticipated that these Watershed Sustainability Outlooks will be included in California Water Plan

Update 2023, to support statewide planning and inform State investment priorities. DWR recognizes

that most of the work to advance sustainable water resources management will occur at regional and

local levels.

Moving forward, additional data and tools will be developed and employed to strengthen the

Sustainability Outlook approach, evaluate trends, and assess current and future sustainability.


WORKING DRAFT 3-1

Chapter 3. Actions for Sustainability

The state’s complex, interconnected water systems continue to support the values and aspirations that

Californians hold in common. These systems were built based on the best available knowledge that

existed generations ago. Since then, they have been continually subject to changing natural and human-

made conditions. As a result, many Californians now face unacceptable risks from flooding and water

quality, unreliable water supplies, continued depletion and degradation of groundwater resources, and

habitat and species declines. Managing water resource systems for sustainability will require changing the

status quo, addressing critical gaps and urgent needs, and strategically planning for the long-term.

First and foremost, the state must address the foundational challenges, described in Chapter 2, related to

governance and alignment, the regulatory framework, institutional capacity, built infrastructure (or grey

infrastructure) and natural infrastructure (or green infrastructure, which provides ecosystem services), and

funding. Addressing these foundational challenges will enable the state to build a clear and efficient path

toward water resource sustainability. This chapter recommends actions that need to be initiated to address

those foundational challenges and support water resource sustainability across water resource

management sectors (e.g., water supply, flood management, ecosystems) and across the state. The chapter

also describes the role that State government fulfills in assisting water and resource managers with

planning, implementing, monitoring, and funding their activities to ensure California’s water resources

are on a path toward sustainability.

State Leadership

Given California’s complex water resource management systems and diffuse governance, State

government must take the lead in sustainably managing water and related resources. Update 2018 focuses

on State government’s leadership in improving the management, the adaptability, and the resilience of

California’s water resources, with the aim of moving water resource systems toward sustainability. To

that end, Update 2018 identifies the actions necessary for the State to facilitate and demonstrate progress

toward sustainability. This update emphasizes the State’s role in assisting and empowering regional water

and resource managers and policy-makers to continuously manage for sustainability by:

• Setting intended outcomes and formulating actions.

• Evaluating whether actions produce their intended outcomes.

• Learning and adapting actions to produce intended outcomes.

The State will continue to lead in the following ways that support the four societal values:

• Engaging and assisting regions to accomplish necessary water resources management services,

such as helping to ensure that all Californians are provided with basic public health and safety. In

some circumstances, the State serves as a provider of last resort and provides basic services when

justified.

• Addressing trans-boundary issues that extend beyond the unique geographical reach and

jurisdictional authority of local, regional, interstate, Tribal, federal, and international entities.


WORKING DRAFT 3-2

• Leveraging resources and providing economies of scale by tapping into the broad expertise and

statewide geographical scale of State agency resources.

• Implementing and providing financial assistance for activities that have broad public benefits and

advance sustainability through public health and safety, ecosystem vitality, a healthy economy,

and opportunities for enriching experiences.

• Constructing, operating, and maintaining green and grey infrastructure it owns or is responsible

for (e.g., the State Water Project, the State Plan of Flood Control, wildlife areas and refuges,

public waterways, recreational facilities).

The primary responsibilities of State government encompass the State’s leadership role in supporting the

five priorities of Update 2018, as identified in Table 1.

Table 1. State Government Responsibilities in Supporting the Five Priorities of Update 2018

State Responsibilities

Update 2018 Priorities Im

pro

ve

Ali

gnm

ent

of

Agen

cies

’ In

itia

tives

and

Gover

nan

ce

Impro

ve

Reg

ula

tory

Fra

mew

ork

to R

econci

le

Envir

onm

enta

l N

eeds

and

Hum

an A

ctiv

itie

s

Pro

vid

e R

esourc

es,

Know

ledge,

Skil

ls,

and T

ools

Wat

er M

anag

ers

Nee

d f

or

Dat

a-D

riven

Dec

isio

n-M

akin

g

Moder

niz

e an

d R

ehab

ilit

ate

Wat

er R

esourc

es M

anag

emen

t

Syst

ems

Pro

vid

e S

uff

icie

nt

and

Sust

ainab

le F

undin

g

Assisting regions to accomplish necessary

water resources management services

X X X X X

Addressing international, interstate, or

trans-boundary issues

X X X

Leveraging resources and providing

economies of scale

X X X X

Implementing and providing financial

assistance for activities that have broad

public benefits and advance sustainability

X X X

Constructing, operating, and maintaining

water resource management systems

X X

Update 2018 recommends aligning delivery of State services related to water resource management

around a shared, statewide definition of sustainability and consistent set of intended outcomes, as well as

tracking actual outcomes over time. This Water Plan presents a vision of sustainably managing water

resources and improves the foundation for the State to address the challenges and opportunities identified

in Chapter 2 and the Governor’s California Water Action Plan (Water Action Plan).

Comprehensive in its scope, Update 2018 also significantly contributes to three primary goals of the

Water Action Plan: (1) to provide a more reliable water supply for farms and communities, (2) to restore

important wildlife habitat and species, and (3) to help the state’s water systems and environment become


WORKING DRAFT 3-3

more resilient. The update also supports, at a foundational level, all 10 actions prescribed by the Water

Action Plan.

1. Make conservation a California way of life.

2. Increase regional self-reliance and integrated water management across all levels of government.

3. Achieve the co-equal goals for the Delta.

4. Protect and restore important ecosystems.

5. Manage and prepare for dry periods.

6. Expand water storage capacity and improve groundwater management.

7. Provide safe water for all communities.

8. Increase flood protection.

9. Increase operational and regulatory efficiency.

10. Identify sustainable and integrated financing opportunities.

Two examples of how Update 2018 advances the 10 Water Action Plan actions are its guidance for

aligning governance and its plan for provision of sufficient and stable funding. Some recommended

actions of Update 2018, such as those that propose progress tracking, directly support individual actions

of the Water Action Plan. When a recommended action does provide such support, it is noted below in the

description of the recommended action.

Recommended Actions

This section focuses on actions that the State will initiate over the next five years to support the long-term

vision of managing water resources for sustainability (see “Long-term Vision and Priorities for Water

Resource Sustainability” in Chapter 1). The recommended actions establish the foundation for addressing

primary impediments to sustainability. The recommended actions are organized by the five priorities of

Update 2018.

• Improve Alignment of Agencies’ Initiatives and Governance — A successful transition to

managing water resources for sustainability requires more coordinated and aligned efforts from

local, regional, State, Tribal, and federal levels of governance.

• Improve Regulatory Framework to Reconcile Environmental Needs and Human Activities —

Managing water resources for sustainability will require a regulatory framework designed to

support achievement of the four societal values; tied to and informed by regional/watershed

planning and implementation efforts, including active planning and investing to enhance

ecosystem function and viability; based on an ecosystem conservation and reconciliation

approach; and tailored for different locations.

• Provide Resources, Knowledge, Skills, and Tools Water Managers Need for Data-Driven

Decision-Making — Technical and facilitation assistance from the State is needed to strengthen

relationships, deepen trust, share information, build institutional capacity, and assess system

performance to support managing water resources for sustainability.

• Modernize and Rehabilitate Water Resources Management Systems — Managing water for

sustainability requires continuous investment in the rehabilitation, modernization, and operations

and maintenance of existing and future infrastructure (green and grey) to provide intended

outcomes.


WORKING DRAFT 3-4

• Provide Sufficient and Sustainable Funding — Managing water resources for sustainability

requires funding (from local, regional, State, federal, and Tribal sources) to develop and update

high-quality regional and State plans and to implement priority actions identified in approved

regional and State plans.

Within each of the five priorities, there are intended long-term outcomes (in regular bold) anticipated to

span multiple water plan cycles. To achieve these outcomes, the recommended actions need to be initiated

within the next five years.

Improve Alignment of Agencies’ Initiatives and Governance

• Objectives of local, regional, State, and federal water and land-use management

organizations and Tribes are aligned with appropriate societal values.

o Societal Value Legislation. The Governor’s Office of Planning and Research (OPR) will

evaluate the benefit of codifying the societal values identified in California Water Plan

Update 2018 (Update 2018) for water resources management in statute.

Legislation would outline the necessity for California water resources planning and

implementation efforts to incorporate societal values and track progress toward managing

water resources for sustainability. The codified societal values would include public health

and safety, a healthy economy, ecosystem vitality, and opportunities for enriching

experiences as presented in Update 2018 and define sustainability as an ongoing, resilient,

and dynamic balance between the societal values. State, regional, and local agencies will be

left the flexibility to determine their own intended outcomes and performance metrics under

the societal values, with the common pursuit of managing water resource sustainably.

o State Agency Alignment Around Sustainability. State agencies will realign governance

structures, authorities, reporting, and strategic planning, as appropriate, to improve the ability

for all State agencies to collaborate, integrate, and invest in sustainable water resources

management activities.

Aligning State agency efforts around sustainability would allow improved ability for

cooperation, coordination, collaboration, integration, and investment in all the societal values,

thus overcoming barriers that can be caused by narrow mission statements and authorities.

For example, this could streamline financial assistance provided to local and regional

agencies and Tribes from State funding sources for multiple-benefit, integrated water

management projects. Further, State agencies will make recommendations to the Legislature

on any changes to agency authorities that would better enable alignment and integration to

support managing water resources for sustainability. To accomplish this alignment, agencies

will work together through multi-disciplinary collaboration processes to strengthen the

collective understanding of sustainability, the societal values, and State incentives for local

and regional entities to achieve shared desired outcomes which affords increased flexibility

for local and regional entities to determine how best to achieve them.

o Inventory and Evaluation of State Government Responsibilities. In consultation with

stakeholders, State water resource agencies will jointly inventory and evaluate the relevancy,

effectiveness, costs, and necessity of all current statutory, contractual, and constitutional

requirements that define State government’s role in water resource management.


WORKING DRAFT 3-5

Current statutory, contractual, and constitutional requirements will be evaluated to ensure

operational efficiency and alignment with the four societal values. The evaluation will be

used to inform Update 2023’s recommendations to modify or remove outdated mandates and

reallocate resources accordingly. The Sustainability Outlook’s outcomes and indictors will be

used to evaluate return on investment and determine the current value (or lack thereof) of all

mandates.

• Stronger alignment of government planning, processes, and tools with existing regional

governance structures so goals and objectives, actions, and tradeoffs are discussed and

evaluated holistically at a watershed scale.

o Watershed Sustainability. DWR will conduct a robust stakeholder outreach process with

local, regional, State, and Tribal representatives to initiate conversations on conducting

regional planning based on hydrologic boundaries (i.e., watersheds) and develop a framework

for successful sustainability planning statewide.

This effort would identify the lessons learned and build upon the successes of integrated

regional water management and groundwater sustainability agency (GSA) development and

implementation. This outreach would begin in 2019, and by 2021 DWR will develop an

initial report to the governor and the Legislature of recommendations for empowering local

and regional entities to:

▪ Better align IRWM and GSA planning processes by developing a framework for better

inter-regional coordination.

▪ Improve water resources planning by considering move toward hydrologically based

planning; start by leveraging IRWM and SGMA and then discuss appropriate planning

scale.

▪ Decrease the planning burden of multiple required plans on local and regional entities by

considering the development of holistic sustainability plans at the appropriate watershed

scale that consider all aspects of water resource management by applying the

Sustainability Outlook.

▪ Establish stable and sufficient funding mechanisms for regional water resources

management.

▪ Support robust disadvantaged community and Tribal involvement.

▪ Link and consolidate regulations, environmental compliance, and permitting processes to

watershed planning.

Planning at the appropriate scale would be led and conducted by local and regional entities,

with planning, technical, and financial assistance from the State to provide incentives for

hydrologically based, planning for sustainability. This recommendation is considered an

initial step in a long-term effort to develop more holistic watershed sustainability plans,

which may take decades to implement. Conducting this initial level of outreach and

developing an implementation strategy for the recommendations would require authorization

and funding from the Legislature.


WORKING DRAFT 3-6

• Stronger relationships with California Native American Tribes acknowledge and respect

Tribes’ inherent rights to exercise sovereign authority and ensure that Tribes are

incorporated into planning and water resource decision-making processes in a manner that

is consistent with their sovereign status.

o Lead Agency Definition. The Legislative Analyst’s Office will evaluate the potential for

modifying the definition of “lead agency” under the California Environmental Quality Act

(CEQA) in government code (State CEQA Guidelines Section 15367, Title 14 California

Code of Regulations 15000 et seq.) to include recognized Tribal governments.

o Tribal Involvement in Regional Planning Efforts. DWR, in coordination with the Tribal

Advisory Committee and State Agency Steering Committee, will prepare recommendations

to assure timely and meaningful communication with Tribes and utilization of

Traditional/Tribal Ecological Knowledge to inform water resources management at the

appropriate scale.

These recommendations will inform the next Water Plan update and improve understanding

of traditional/Tribal Ecological Knowledge by local, regional, and State agencies. Through

this effort, Tribes and State agencies will work together to develop strategies and options for

ensuring greater and early collaboration regarding water resource sustainability projects, as

well as regional planning and management activities, especially where decisions affect Tribal

trust lands and/or traditional territories/homelands.

o State Contracting with Tribes. As permitted by statute, the California Department of General

Services (DGS) will update the State Contracts Manual language and process to reconcile the

sovereign status of Tribes and the ability of Tribes to receive State grants and loans. If

required, DGS will make recommendations to the Legislature for amending statute.

Improve Regulatory Framework to Reconcile Environmental Needs and Human Activities

[Note to reviewer: The public review draft will reflect ongoing coordination with the State Agency

Steering Committee to recognize and leverage existing programs.]

• Regulations include a systems-oriented approach, rather than just avoiding or mitigating

environmental impacts caused by discrete projects, for strategic environmental assessment

that reconciles environmental needs and human activities through the dynamic balance

among all four societal values.

o Programmatic Environmental Compliance Task Force. The California Natural Resources

Agency and the California Environmental Protection Agency will jointly convene a task force

of local, State, and federal resources and water management agencies and Tribes to develop a

programmatic environmental compliance process considering multiple project or activity

types to balance ecosystem functions and human activity by replacing current site‐by‐site

mitigation requirements, as well as expedite permitting of critical maintenance activities and

water system improvement projects.

Establishing this task force would require authorization and funding from the Legislature.

The task force will develop a report, summarizing its recommendations, for use by the


WORKING DRAFT 3-7

Legislature and Governor in considering statutory, regulatory, and policy adjustments. The

task force will be charged with developing recommendations to:

▪ Reduce impediments to project implementation and transactional costs caused by

regulations and processes.

▪ Tie and consolidate regulations and permitting processes to ecoregional and regional

planning, implementation efforts, and long-term system management for sustainability,

which should include active planning and investment to enhance ecosystem function,

viability, biodiversity, and resilience to pressures and stressors, including climate change.

▪ Support existing regional conservation and regulatory tools, and improve existing tools

and processes to address common challenges and concerns with the current regulatory

framework to streamline the permitting process and move beyond traditional project-by-

project mitigation. Other ideas to consider include delegation of regulatory authorities

and consolidation of permitting efforts and responsibilities.

▪ Consider changes to allow more regionally focused approaches to regulation and

investments for ecosystem reconciliation. Identify options that allow State and federal

regulators to rethink and experiment with more holistic and place-based approaches.

• Resolution of common challenges and concerns regarding current regulatory framework is

achieved through improved coordination.

o Ecosystem Restoration Project Permitting. The California Department of Fish and Wildlife

will evaluate permitting processes for ecosystem restoration and enhancement projects and

make recommendations on potential statutory alterations to mitigation requirements for

restoration projects.

Recommendations will consider agency resources, improvements to communication and

coordination, funding, and how the small habitat restoration project CEQA exemption could

be modified.

The evaluation will include a determination whether permitting for restoration projects could

be considered on a separate track that allows credit for the restoration components of projects,

such as by including them in regional conservation plans or strategies to develop mitigation

credit agreements. Considerations will also include exempting projects that include a

restoration component from additional mitigation requirements necessitated by the impacts of

that restoration component.

o Delegation of Federal Permitting. State regulatory agencies will work with their federal

permitting agency counterparts to seek delegation of authority to reduce the number agencies

involved in the permitting process and improve coordination.

Precedent exists in the California Environmental Protection Agency and the California

Department of Transportation (Caltrans). For example, Caltrans participated in the Surface

Transportation Project Delivery Program, under which Caltrans may assume National

Environmental Protection Act responsibilities of the U.S. Department of Transportation

Secretary with respect to one or more highway projects in California (California Department

of Transportation 2014).


WORKING DRAFT 3-8

o Cooperative Agreements. State regulatory agencies will prepare cooperative agreements for

permit reviews among multiple regulatory agencies to increase efficiency by maximizing

expertise and available resources.

Agencies will seek to reduce the number of regulatory agencies with which a project

proponent must coordinate and enable sharing of limited resources, such as staff (this may

require recommendations to the legislature). If agreements cannot be reached or are not

feasible, regulatory agencies will consider development of web-based tools for “one-stop”

permitting support for State permits to help project proponents.

Provide Resources, Knowledge, Skills, and Tools Water Managers Need for Data-Driven

Decision-Making

• Data-driven decision-making and policies are supported by best available science, data,

tools, current scientific understanding of ecosystem function, traditional ecological

knowledge, and when necessary, new technologies and innovations.

o Economic Benefits of Ecosystem Services. DWR, in coordination with the California

Department of Fish and Wildlife, State Water Resources Control Board, academia, and other

stakeholders, will develop guidance for calculating the economic benefits of ecosystem

services to more accurately determine project benefits and economic feasibility.

o Climate Science and Monitoring Program. The California Natural Resources Agency, the

California Environmental Protection Agency, and the Governor’s Office of Planning and

Research, in partnership with federal agencies and academia, will jointly develop a Climate

Science and Monitoring Program.

The program would support the monitoring, forecasting, and scientific understanding of the

role of the climate system in extreme precipitation events and better inform water resources

management during extreme events. Ongoing research collaborations including tracking

atmospheric rivers, rain/snow trends, upland watershed monitoring, paleohydrology, sea-level

rise, seasonal winter outlooks, and changes in streamflow and stream temperatures should be

funded by this program. The program would also ensure that climate science and best

available information are used to modernize the water resource management system. The

program would require authorization and annual, long-term funding from the Legislature to

ensure success. This program would help implement the actions recommended in the

Governor’s Water Action Plan to “revise operations to respond to extreme conditions” and

“provide essential data to enable sustainable groundwater management.”

o Comprehensive Water Resource Data Collection and Management Program. State water

resource agencies will jointly develop a Comprehensive Water Resource Data Collection and

Management Program to assist local and regional entities and build regional capacity by

developing, monitoring, maintaining, and sharing information, data, models, and other tools.

State agencies will work with regions to determine data and data management needs. State

agencies will publish and update quarterly State-held water and ecological datasets on a

comprehensive and open data platform (as required under Assembly Bill 1755, California

Water Code section 12410). State agencies will also maintain minimum protocols, as well as

best practices, for data-sharing, documentation, quality control, public access, and promotion


WORKING DRAFT 3-9

of open-source platforms and decisions support tools related to water and ecological data.

This program would require authorization and annual, long-term funding from the Legislature

to ensure success. This program would help implement the actions recommended in the

Governor’s Water Action Plan to “provide essential data to enable sustainable groundwater

management” and “prepare for the future through better technology and improved

procedures.”

o Sustainability Outlooks. DWR will engage and incentivize stakeholders in developing and

maintaining Sustainability Outlooks (Outlooks), as introduced in Chapter 2, to provide a

snapshot and evaluation of the metrics or indicators demonstrating movement toward

sustainability, including the status of water-related contributions to public health and safety,

healthy economy, ecosystem vitality, and opportunities for enriching experiences.

To enable effective collaboration around this effort, DWR will develop tools to allow

collection of information needed to assemble the Outlooks. The Outlooks will be used to

inform updates of the California Water Plan and potential future watershed sustainability

planning. Prior to Update 2023, the Outlooks will be developed for, and applied within, the

10 hydrologic regions, or at a more refined scale as recommended through the Watershed

Sustainability action described above. The development of Outlooks will require

authorization and annual, long-term funding from the Legislature to ensure success and

adequate State financial assistance.

The Outlooks will include an assessment of the efficacy of governance, regulations, and

funding of water resources management activities statewide and for individual regions. The

Outlooks will utilize Traditional/Tribal Ecological Knowledge. From this base of

understanding of current conditions, DWR will work with stakeholders to define intended

outcomes and recommended actions to achieve them for each hydrologic region.

o State Water Resource Management Sector Plans. The appropriate State agencies will develop,

maintain, and align water resource management sector plans that define strategies and

processes, as well as intended outcomes, to dynamically balance the four societal values.

These plans would be combined and aligned with the Water Plan to leverage opportunities for

multiple benefits.

Water resource management sectors are flood management, water supply reliability, water

quality, ecosystems, and people and water (i.e., recreation, social and cultural uses, and

aesthetics). These plans will include statewide and regional overviews and will be updated

every five years. They will provide an overview of statewide conditions, articulate policy

priorities, and ensure intended outcomes for each water resource management sector are

clearly identified. DWR’s Statewide Flood Management Planning Program and CDFW’s

State Wildlife Action Plan are good examples of sector plans. Developing and updating

sector plans would require authorization and funding from the Legislature to ensure State

resources are available.

o Plan Alignment. DWR will evaluate timing and opportunities to improve efficiencies and

effectiveness of all legislatively mandated, water resource-related plans developed by State

agencies and make recommendations for modifying any legislatively mandated deadlines to

ensure effective and efficient integration of information into the Water Plan.


WORKING DRAFT 3-10

State agency plans related to water resource management activities will be completed

approximately two years before the final release of the next Water Plan update. Staggering

the release of required plans will allow better integration and application of the information at

a statewide scale. This action is important to improve coordination and efficiency of multiple,

at times uncoordinated, planning efforts at all levels of government and reduce duplication of

information and data development, tracking, and reporting.

o Statewide Water Storage Reconnaissance Program. DWR will establish an ongoing Statewide

Water Storage Program to evaluate surface and groundwater storage opportunities in the state

and provide technical support to local and regional water agencies and groundwater

sustainability agencies.

As part of the program, DWR initially will prepare a statewide evaluation to identify the

benefits, costs, hydrologic and engineering attributes, environmental attributes, and other

tradeoffs and feasibility indicators regarding surface and groundwater storage opportunities.

The evaluation will include optimal locations for groundwater recharge throughout

California. Such an evaluation will inform the potential role of surface and groundwater

storage in advancing recent and emerging State initiatives, future bonds/initiatives, and

watershed sustainability.

The statewide storage evaluation will reflect 21st-century planning conditions and priorities

that include seeking strategies that provide multiple benefits, taking a systemwide planning

approach, planning transparency, changing societal values/goals, changing hydrology and

water supply under a changing climate (including loss of snowpack), and improved

assessment tools. This program will provide an assessment of feasible storage and recharge

opportunities throughout the state and will be a companion to DWR’s System Reoperation

Study and the Water Availability for Replenishment report. This program will also

demonstrate State government leadership in the form of regional capacity-building and

partnerships, since most local and regional entities do not have the resources or technical

ability to conduct such an evaluation across jurisdictions. Activities will be designed to assist

in implementing the Sustainable Groundwater Management Act statutes and Action 6 of the

California Water Action Plan (Expand Water Storage Capacity and Improve Groundwater

Management). This program will also help implement the actions recommended in the

Governor’s Water Action Plan to “revise operations to respond to extreme conditions” and

“increase statewide groundwater recharge.” This program would require authorization and

annual, long-term funding from the Legislature to ensure success.

o Regional Engagement in California Water Plan Update 2023. Through the California Water

Plan Update 2023 (Update 2023) process, DWR will continue utilizing an enhanced regional

planning process and regional forums to effectively engage and empower regional water

management groups, groundwater sustainability agencies, and other existing regional and

local entities foundational to effective regional planning and management.

This engagement will begin implementation of the recommendations presented in DWR’s

Stakeholder Perspectives: Recommendations for Sustaining and Strengthening Integrated

Regional Water Management. This effort will also support DWR in developing annual


WORKING DRAFT 3-11

reports for tracking the implementation of Update 2018 and the regional reports and/or atlases

for Update 2023. This regional engagement will result in:

❖ Shared vision and values.

❖ Policy and investment priorities.

❖ Water management and investment needs.

❖ The Sustainability Outlook.

❖ State investment in shared outcomes for each area.

❖ Recommend State incentives and funding sources.

• Stronger integrated water management planning, program performance tracking, and

reporting of intended and actual outcomes on regular cycles promote continuous learning

and adaptation.

o State Agency Performance Tracking and Reporting. State agencies will develop, maintain,

and make available data and information management systems needed to conduct the system

performance assessments and to support integrated planning and implementation for

sustainability, including water budgets, system assessment and performance, and ecosystem

conditions.

State agencies will collect data and information needed to describe how agency actions

support sustainability and to update and develop the Outlooks, as described above. Tracking

and reporting efforts will support and improve the ability of State agencies to adaptively

manage water resource systems by establishing long-term trends and flagging when activities

are not producing the desired outcomes.

o Reporting Requirements for State Funding. State agencies will require performance tracking

and reporting for all projects funded or partially funded with State funds.

All planning and implementation efforts should address societal values and track progress

toward managing water resources for sustainability. Additionally, State agencies will require

performance tracking and reporting on the societal values and sustainability in grant program

guidelines and proposal solicitation packages. Language will be standardized in grant

program guidelines and proposal solicitation packages across programs, and in authorizing

bond language, so links to sustainability and the societal values are consistent.

• Improved technical and facilitation assistance and greater access to data and tools facilitate

the participation of under‐represented and economically disadvantaged communities in

planning efforts at all levels.

o Disadvantaged Community Liaisons. State agencies will support disadvantaged community

involvement through technical, facilitation, and funding assistance to manage water resources

sustainably. State agencies will engage proactively and consistently with different local,

regional, State, and federal agencies and Tribes to promote more effective integration and

cooperation.

o Appropriate State agencies will create disadvantaged community liaison positions to seek

candidates that have adequate qualifications and understanding of disadvantaged

communities’ needs to support more effective integration. The liaisons would further the

action recommended in the Governor’s Water Action Plan to “provide assistance to

disadvantaged communities.”


WORKING DRAFT 3-12

o Disadvantaged Community Engagement in Integrated Regional Water Management Groups.

State government should provide noncompetitive base-level funding, subject to State

accountability requirements, for IRWM regions to support stakeholder engagement;

coordination and collaboration; IRWM plan updates; and participation of underrepresented

groups, such as disadvantaged communities and local agencies with budget constraints.

This engagement would further the action recommended in the Governor’s Water Action

Plan to “provide assistance to disadvantaged communities.”

• California’s population is better educated in water resource issues, and more students are

attracted to a career in water resource management.

o Water Resource Education. State agencies will work with school districts, universities, and

foundations to attract more students to the field of water resource management, and to expand

related curricula and programs.

o All State conservancies, DWR, DFW, and California State Parks will improve outreach and

education that will improve public health, support outdoor recreation, and promote wise use

of water resources.

Modernize and Rehabilitate Water Resource Management Systems

[Note to reviewer: The public review draft will reflect ongoing coordination with the State Agency

Steering Committee to recognize and leverage existing programs.]

• Operations, maintenance, and ecosystem management practices are based on current, best

available data and management practices, and operating plans and manuals are routinely

updated, as appropriate for the facility type.

o Statewide Water Resources Management Systems Operations and Maintenance Assessment

Program. DWR and other State agencies will develop a Statewide Water Resource

Management System Operations and Maintenance Assessment Program to provide technical

and financial assistance to help owners and operators and resource managers gain a better

understanding of the status of the operations of green and grey infrastructure statewide and its

ability to perform the desired level of service and to support the management of water

resources for sustainability.

The State will provide financial incentives for participation in this voluntary program. The

program will assist local, regional, and State water and resource managers with assessing, on

a system scale (i.e., larger infrastructure/natural systems, rather than the equipment scale),

deferred maintenance; outdated operational procedures and manuals; and operational changes

needed to address extreme hydrology, increase aquifer replenishment, reconcile operations

and maintenance activities with ecosystem vitality, and modernize benefits (i.e., reoperation).

Participants will be responsible for determining if an assessment is necessary and for

assessing their own facilities, if a sufficient and routine assessment program does not already

exist. Results of the assessment program will be used to prioritize State investment in the

Statewide Water Resource Management Systems Operations and Maintenance Modernization

Program described below.

The assessments should be updated every five years, or in a time frame appropriate to the

facility and local conditions (i.e., susceptibility to changing physical conditions and


WORKING DRAFT 3-13

hydrology). Results will also be considered in the development of Outlooks and future

watershed sustainability planning. This program would require authorization and funding

from the Legislature to ensure sufficient resources are allocated. This program would help

implement the actions recommended in the Water Action Plan to “support and expand

funding for integrated water management planning and projects,” “encourage State focus on

projects with multiple benefits,” “revise operations to respond to extreme conditions,”

“increase statewide groundwater recharge,” “encourage flood projects that plan for climate

change and achieve multiple benefits,” and “prepare for the future through better technology

and improved procedures.”

o Statewide Water Resource Management Systems Operations and Maintenance Modernization

Program. DWR will develop a Statewide Operations and Maintenance Modernization

Program to provide technical and financial assistance to help owners and operators and

resource managers to extend California’s water infrastructure’s useful life by reducing

deferred maintenance, undertaking modernization of water- and flood-related operations and

maintenance (O&M) procedures and manuals, providing for resiliency to extreme hydrology

(e.g., floods and droughts), reconciling and co-managing O&M needs with ecosystem

vitality, and modernizing benefits through reoperation.


program will be informed by information and prioritization established by the Statewide

Water Resources Management Systems Operations and Maintenance Assessment Program.

Results of this program will be tracked and reported routinely to assess the attainment of the

intended outcomes. Results will also be considered in developing Outlooks and future

watershed sustainability planning. This program would require authorization and funding

from the Legislature to ensure sufficient resources are allocated. This program would help



projects with multiple benefits,” “revise operations to respond to extreme conditions,”

“increase statewide groundwater recharge,” “encourage flood projects that plan for climate

change and achieve multiple benefits,” and “prepare for the future through better technology

and improved procedures.”

• Modernized and rehabilitated water resource management systems reduce risks associated

with aging and/or deficient infrastructure, degraded ecosystems, and the effects of climate

change.

o Statewide Water Resources Management Systems Assessment Program. DWR and other

State agencies will develop a Statewide Water Resources Management System Assessment

Program to provide technical and financial assistance to help local, regional, State, and

federal water managers gain a better understanding of the status of their water resources

management systems and their ability to perform the desired level of service and support

managing water resources for sustainability.


program will assist local, regional, and State water and resource managers to assess their

water resource management systems for critical deficiencies, remaining useful life, climate

resiliency, potential effects of subsidence, and benefits of system modernization and

ecosystem revitalization, as needed. The assessment also will consider decommissioning any


WORKING DRAFT 3-14

components of the water resource management system that have outlived their useful life, and

other resource management strategies that can provide similar benefits. Results of the

assessment program would be used to prioritize State investment in the Statewide Water

Resource Management Systems Modernization and Rehabilitation Program described below.

Results will also be used by local and regional entities in the development of Outlooks and

future watershed sustainability planning. In addition, results would support local asset

management programs and forecasting of capital improvements. This program would require

authorization and funding from the Legislature to ensure sufficient resources are allocated.

This program would help implement the actions recommended in the Water Action Plan to

“support and expand funding for integrated water management planning and projects,”

“encourage State focus on projects with multiple benefits,” “increase statewide groundwater

recharge,” and “encourage flood projects that plan for climate change and achieve multiple

benefits.”

o Statewide Water Resources Management Systems Modernization and Rehabilitation

Program. DWR and other State agencies will develop a Statewide Water Resource

Management Systems Modernization and Rehabilitation Program to help ensure statewide

water resource systems are rehabilitated from the effects of subsidence, resilient to a

changing climate, and provide flexibility for managing water resources into the future.

The State will provide financial incentives for participation in this voluntary program. This

program will include funding for major rehabilitation, replacement, and new facilities that

promote modernization of water- and flood-related infrastructure, including natural

infrastructure and ecosystem services. The program will assist participating local, regional,

and State water and resource managers to modernize and rehabilitate their water resources

management systems, as requested. State modernization and rehabilitation funding assistance

will capitalize on local and federal cost-sharing. The program will utilize an integrated

approach to rehabilitation and modernization, including ecosystem restoration and climate

change adaptation. This program would help implement the actions recommended in the

Water Action Plan to “support and expand funding for integrated water management planning

and projects,” “encourage State focus on projects with multiple benefits,” “increase statewide

groundwater recharge,” and “encourage flood projects that plan for climate change and

achieve multiple benefits.”

This program will be informed by the results and prioritization established in the Statewide

Water Resource Management System Assessment Program. Results of this program will be

tracked and reported routinely to assess the attainment of the intended outcomes. Results will

also be considered in the development of Outlooks and future watershed sustainability

planning. This program would require authorization and funding from the Legislature to

ensure sufficient resources are allocated.

• Natural processes are restored by using vegetation and soils, and applying such land use

practices as working landscapes, mountain meadows, and forest management, to manage

water and create healthier urban, rural, and natural environments.

o Statewide Green Infrastructure and Working Landscapes Task Force. The California Natural

Resources Agency and the California Department of Food and Agriculture will jointly lead a

Statewide Green Infrastructure and Working Landscapes Task Force.


WORKING DRAFT 3-15

The task force would review alternatives and establish a framework for developing a

conservation easement program that supports green infrastructure and working landscapes

and considers protection of groundwater recharge areas and natural upper watershed lands.

The Task Force will prepare a report summarizing its findings and recommendations for use

by the Legislature and the Executive Branch in developing statute, regulations, and policy.

Establishing this task force would require authorization and funding from the Legislature to

ensure adequate resources are allocated. This Task Force would further the actions

recommended in the Governor’s Water Action Plan to “improve land use and water

alignment” and “increase statewide groundwater recharge.”

o Integrated Flood Managed Aquifer Recharge. DWR, in consultation with the U.S. Army

Corps of Engineers, regional flood agencies, groundwater sustainability agencies, and

landowners, will prepare a comprehensive plan and implement opportunities for integrating

flood, surface water supply, groundwater management, and ecosystem enhancement to

increase aquifer recharge (Flood-MAR). This would include using flood flows for managed

aquifer recharge to reduce flood risk; stopping or slowing groundwater overdraft and

subsidence; reconnecting floodplains; and improving ecosystems, drought preparedness, and

water quality. The plan will examine expanded flood bypasses and flood easements in

conjunction with groundwater recharge strategies, including groundwater banking and

storage. These strategies will include using agricultural, grazing lands, and other working

landscapes for recharge, expanded conveyance of flood flows to recharge areas, and

reoperation of reservoirs for early releases of water for recharge prior to storms. DWR will

provide technical, planning, and facilitation assistance to local and regional entities

evaluating managed aquifer recharge opportunities. The Flood-MAR program would help



projects with multiple benefits,” “increase statewide groundwater recharge,” and “encourage

flood projects that plan for climate change and achieve multiple benefits.”

o Integrated Land Use and Water Management Implementation Program. The California

Natural Resources Agency, Governor’s Office of Planning and Research, and the California

Department of Food and Agriculture will jointly implement an Integrated Land Use and

Water Management Implementation Program to promote the integration of land use and

water management activities.

This program will be designed to enable the State to improve the integration of its own green

and grey infrastructure, as well as provide technical and financial assistance to local and

regional agencies. This program will facilitate stronger collaboration among land use

planners and water planners. This program will provide regulatory and financial incentives

for local and regional plans that include integrated water management (IWM) and provide

technical tools and data resources to make it easier for local governments to prepare land use

plans that include IWM. The program will encourage measures that also include preservation

of existing floodplains, aquifer recharge areas, agricultural and working lands, and alluvial

fans; reduction of hardscapes; implementation of low-impact development practices;

restoration of natural floodplain functions; and design measures to increase post-flood

resiliency. This action would further the Water Action Plan to “improve land use and water

alignment” and “improve statewide groundwater recharge.”


WORKING DRAFT 3-16

Provide Sufficient and Sustainable Funding

• Consistent, ongoing State investment delivers specific long-term outcomes that contribute to

the four societal values.

o Investment Prioritization. State government should prioritize investments based on expected

contribution of a program or project to the four societal values, cost effectiveness, ability to

improve watershed resiliency, and consistent with the shared values and principles (see

“Consistency with Shared Funding Values and Principles” in Chapter 5).

• Use consistent, reliable, and diverse funding mechanisms, with an array of revenue sources,

to support managing water resources for sustainability, including ongoing management

actions and capital projects.

o Removal of Funding Barriers. DWR and other State agencies will engage local water

managers and elected officials in compiling strategies and best practices to remove barriers to

local and regional funding for water projects.

This evaluation will include recommendations to clarify the 1996 Right to Vote on Taxes

Act’s (Proposition 218’s) applicability to water-related fees and taxes, including potential

recommendations to modify legislation, if necessary. The evaluation will also identify

limitations to implementing multi-district/multi-benefit projects, such as using fees from

assessment districts for out-of-district actions. This activity would help implement the action

recommended in the Water Action Plan to “remove barriers to local and regional funding for

water projects.”

o Novel Funding Mechanisms Feasibility Study. In collaboration with water managers,

decision-makers, and other stakeholders, DWR, through the Water Plan Team, will work with

stakeholders and develop a feasibility study to identify any potential changes to existing

funding mechanisms and explore novel funding mechanisms.

Novel funding mechanisms may include an assessment to help fund the public benefits of

water projects or a statewide flood insurance program for funding flood management

activities. The study will provide recommendations to the Legislature and Administration

regarding novel funding mechanisms, who would pay them, how they would be collected,

and how they could be used. This program would help implement the action recommended in

the Water Action Plan to “analyze user and polluter fees.”


WORKING DRAFT 3-17

Summary Table of Recommendations

Table 1 provides a summary of how the actions described above could support sustainability and a range of costs and time to implement. How

each action may support sustainable water resource management in California is scored by determining if the action has an indirect, low,

moderate, or high potential to contribute to the four societal values. The potential range of annual capital and State operations costs for each of the

identified actions is identified by the following ranges of costs:

Table 3-1. Summary of How the Recommended Actions Support the Societal Values and the Estimated Cost and Time to Implement the

Actions

Recommended Actions by the Five Priorities

Societal Values CA Water

Action Plan

Actions

Advanced

(Directly or

Indirectly)

Annual Cost Time to

Implement

Public

Health &

Safety

Healthy

Economy

Thriving

Ecosystems

Enriching

Experiences


Societal Value Legislation All $ 1–2 years

State Agency Alignment Around Sustainability i i i i All $ 1–2 years

Watershed Sustainability Planning Outreach

and Recommendations

i i i i All $ 1–2 years

Inventory and Evaluation of State Government

Responsibilities

i i i i All $ 5 years

Lead Agency Definition i i i i 9 $ 1–2 years

Tribal Consultation i i i i All $ 1–2 years

State Contracting with Tribes i i i i All $ 1–2 years


Programmatic Environmental Compliance Task

Force

i i i 9 $ 1–2 years

Restoration Project Permitting i i i 9 $ 1–2 years

Delegation of Federal Permitting i i i i 9 $ 1–2 years

Cooperative Agreements i i i i 9 $ 1–2 years

Provide Resources, Knowledge, Skills, and Tools Water Managers Need for Data-Driven Decision-making

Climate Science and Monitoring Program i i i i 5, 6 $$ Continuous

Comprehensive Water Resource Data

Collection and Management Program

i i i i 6, 9 $$$ Continuous

Regional Sustainability Outlooks i i i i All $ Continuous

Water Resources Management Sector Plans All $$ Continuous


WORKING DRAFT 3-18

Recommended Actions by the Five Priorities

Societal Values CA Water

Action Plan

Actions

Advanced

(Directly or

Indirectly)

Annual Cost Time to

Implement

Public

Health &

Safety

Healthy

Economy

Thriving

Ecosystems

Enriching

Experiences

Plan Alignment i i i i All $ 1–2 years

Statewide Water Storage Reconnaissance

Program

i i i i 5, 6 $ Continuous

Economic Benefits of Ecosystem Services 4

Regional Engagement in Update 2023 i i i i 2 $ 3–5 years

State Agency Performance Tracking and

Reporting

All $ Continuous

Reporting Requirements for State Funding All $ 1–2 years

Disadvantaged Community Liaisons 2 $ Continuous

Disadvantaged Communities Engagement in

Integrated Regional Water Management

i i i i 2 $$$ Continuous

Water Resource Education All $ Continuous

Modernize and Rehabilitate Water Resources Management Systems

Statewide Water Resources Management

Systems Operations and Maintenance

Assessment Program

i i i i 2, 6, 8, 9 $$$$ 3-5 years


Systems Operations and Maintenance

Modernization Program

2, 6, 8, 9 $$$$$ Continuous


Systems Asset Assessment Program

i i i i 2, 6, 8 $$$$ 3–5 years


Systems Modernization and Rehabilitation

Program

2, 6, 8 $$$$$$ Continuous

Statewide Green Infrastructure and Working

Landscapes Task Force

2, 6 $ 1–2 years

Integrated Managed Aquifer Recharge 4, 5, 6, 8 $$ 3-5 years

Integrated Land Use and Water Management

Implementation Program

2, 6 $$$$ 3-5 years

Provide Sufficient and Stable Funding

Investment Prioritization 10 $ Continuous

Removal of Barriers 10 $ 1-2 years

Novel Funding Mechanisms 10 $ 1-2 years


WORKING DRAFT 3-19

Notes:

i Potential indirect contribution to this outcome

Low potential contribution to this outcome

Moderate potential contribution to this outcome

High potential contribution to this outcome

$ < $2 million

$$ $2 million - $10 million

$$$ $10 million - $50 million

$$$$ $50 million - $200 million

$$$$$ $200 million - $500 million

$$$$$$ $500 million+


WORKING DRAFT 4-1

Chapter 4. Investing in Water Resource Sustainability

Aligning investments and funding mechanisms with the four societal values — public health and safety,

a healthy economy, ecosystem vitality, and opportunities for enriching experiences — is necessary to

manage California’s water resources for sustainability. Yet, annual historical funding will not support the

level of investment needed to effectively manage for sustainability. To build on the accountability

afforded by the Sustainability Outlook and Update 2018’s five priorities and the recommended actions,

Chapter 4 provides the analysis and findings that will inform decisions leading to sufficient and stable

State funding to implement those actions. The value of this funding, which the State has a role in

ensuring, will be realized in many ways, including:

• Improvement of California’s watersheds.

• Operation, maintenance, repair, rehabilitation, and replacement of existing systems.

• Tracking and reporting progress toward water resource management sustainability.

Scope and Setting Although local, federal, and other stakeholders play a crucial role in funding water management actions,

the scope of Update 2018’s funding recommendations are focused on State government roles,

responsibilities, and obligations for sustaining California’s water resources. Comprehensive in its scope,

Update 2018 supports the 10 actions of the Water Action Plan.

Some elements of water resource management, such as water supply and wastewater treatment, are

predominately funded by ratepayer revenues, as well as through local revenue bonds for larger capital

investments. On the other hand, many other elements — such as managing flood and stormwater,

statewide planning and data, statewide infrastructure, legacy impacts, and ecosystems — often are not

stably or sufficiently funded. This is particularly true of management actions that help sustain benefits of

past investments (e.g., operation and maintenance) and secure benefits from future investments (e.g.,

providing resources, knowledge, skills, and tools water managers need). State government has a major

role in funding these elements and actions statewide, and even more so in disadvantaged communities.

Yet, typically less than 2 percent of the State General Fund is used for water resource management,

while much of the remaining funding comes from general obligation (GO) bonds. (see Appendix XX.)

Because the General Fund serves a vast array of critical needs, and GO bonds are subject to voter

approval, water resource funding is subject to competing and shifting priorities. This makes the funding

required to sustainably manage water resources variable and uncertain.

Total statewide integrated water management (IWM) funding needs across all levels of government

were estimated to provide a common understanding of those funding needs, in the broadest context,

for the water-related management actions planned within California. The total estimated need is more

than $365 billion over the next 50 years. If current funding levels are maintained, a funding gap of more

than $175 billion will occur over the next 50 years. (See Appendix XX.) That said, these estimated total


WORKING DRAFT 4-2

IMW funding needs, which likely are beyond what California will be able afford, are provided only for

context and did not directly inform the funding options presented in Chapter 5.

The investments recommended in Update 2018 focus on implementation of the actions recommended

in Chapter 3, not the total estimated need described above. Update 2018 uses a disciplined approach by

adhering to the finance principles of Update 2013, and thus recommends a feasible increase in State

government funding. The total State funding need for all State agencies to implement these

recommended actions is about $102 billion over the next 50 years, averaging approximately $2 billion

per year. A 50-year planning horizon was used to determine long-term funding needs and trade-offs,

with emphasis on the initial five-year implementation period (2019–2023). (See Appendix XX.)

Assumptions [Note to Reviewer: This section is still under development with the primary goal of maximizing

transparency by disclosing all general findings and presuppositions.]

Several assumptions underlie the development of Update 2018’s reasoning and proposals related to

funding the recommended actions. Those assumptions are as follows:

• State government has unique roles, responsibilities, and obligations as summarized in Chapter 2.

Many of these cannot be undertaken or accomplished at a local or regional level. Tracking and

ensuring statewide water resources sustainably is a prime example.

• State government also has court-established responsibilities, such as financial liability for flood

damages in many parts of the state, as well as responsibilities resulting from, among many other

laws, State and federal endangered species act litigation rulings.

• Public benefits from flood management, statewide planning and data, statewide infrastructure,

assistance to disadvantaged communities, ecosystem management, and remediation of legacy

impacts are often inadequately or unstably funded. State government has a major role in many

of these areas.

• While Update 2018 focuses on State funding and does not include federal funding

recommendations, the State could benefit from establishing an advocacy program with

increased presence in Washington DC to secure more federal funding. Such advocacy can also

more directly influence and align federal water policies and regulations with State priorities. This

is especially important in the flood sector, where funding is largely federal.

• Annual historical funding will not support the level of investment needed for statewide

sustainability.

• Historical expenditures were often driven by funding constructs that have not adequately

funded what Californians value.

• A blend of several existing and novel mechanisms is necessary for sufficient and stable funding

for water resources management.

• Implementation of a novel mechanism by State government can reduce local agencies’ ability to

raise revenue for local activities. For example, assessments are currently the primary source of

funding for local flood agencies. Any new State assessment could reduce the public’s ability or


WORKING DRAFT 4-3

willingness to pay for local flood operations and maintenance (O&M) and capital projects. The

same is true for other water management sectors.

• Funding for ongoing management actions are often underfunded compared with capital

management actions. This has caused significant deferred maintenance for much of the state’s

infrastructure.

• State government does not have a stable and sufficient funding mechanism to assist

disadvantaged communities in securing funding for capital investment and, to a greater extent,

operation, maintenance, and other ongoing funding needs.

• Water supply reliability and water quality management actions conceptually have more reliable

funding because they are ratepayer supported. Nevertheless, insufficient funding still hinders

some areas of the state.

• Regional water management groups are well-positioned in many areas to interact with the State

to explore planning and funding innovations. Integrated regional water management (IRWM) as

a program and a practice has delivered significant value and continues to be the most effective

way for the State to fund local and regional activities.

• One of the most effective and flexible methods for State government to invest in statewide

suitability is to provide local and regional financial assistance with specified desired outcomes.

The outcomes must reflect the public benefits, be consistent with State government’s roles and

responsibilities, and occur at the appropriate scale. Local and regional entities can then

determine the best way to accomplish the outcomes based on local/regional priorities,

conditions, and available solutions.

• Increasing funding from local and federal mechanisms to match State expenditures results in

earlier implementation of management actions, especially for capital actions. This early

implementation is a result of additional funding becoming available sooner.

• Cost savings and efficiencies associated with implementing the recommended actions in

Chapter 3 are included in the cost estimates (see Table 4-2).

Building on Update 2013 Finance Accomplishments and Commitments Funding conversations and decision-making are complicated and often contentious. But broad

agreement was established in California Water Plan Update 2013 (Update 2013) regarding several

fundamental aspects of State government funding. Update 2018 builds on the accomplishments and

makes significant strides in fulfilling agreed-upon shared values and principles in developing viable, well-

vetted State IWM investment and funding recommendations. Table 4-1 illustrates how most of the

shared values and principles of Update 2013, those applicable in scale and scope to Update 2018,

helped shape five innovations developed and proposed in this update. These innovations represent a

practical end-to-end strategy for water resource management and, as discussed under “Implementing

Update 2018 Innovations” in Chapter 5, must be utilized if California is to make significant progress

toward sustainability. More specific guidance on how these values and principles incorporated in policy

and investment decisions is provided under “Consistency with Shared Funding Values and Principles” in

Chapter 5.


WORKING DRAFT 4-4

Table 4-1: Application of Update 2013 Shared Values and Principles Through Update 2018 Innovations

Update 2013 Shared Values and Principles (The paraphrased excerpts below are of the proper

scale, scope, and content to apply in Update 2018; a complete list in Update 2013, Volume 1, Chapter 7)

Update 2018 Innovations

Stat

ewid

e W

ate

r R

eso

urc

es S

ust

ain

abili

ty

Sust

ain

abili

ty O

utl

oo

k

Rec

om

men

ded

Act

ion

s

Imp

lem

enta

tio

n P

lan

an

d

Fun

din

g O

pti

on

s

CW

P A

nn

ual

Rep

ort

Decisions are informed and priorities set with broad stakeholder participation, based on shared funding values, defined principles, goals, objectives, and criteria.

X X X X

Decisions are made using best available data and knowledge, with the understanding that deferring decisions can result in increased costs of implementation, hesitation, and missed opportunities.

X X X

Investment decisions account for the availability of future revenues, cost of borrowing, and risks of indebtedness. Investments are matched with appropriate funding mechanisms.

X

Good stewardship of State government funds includes transparency, accountability, discipline to spend reasonably, clarity of purpose, and personal integrity of those entrusted with public funding. This engenders trust and increases the public’s willingness to pay for future IWM activities.

X X X X

State government funding is not redirected from its authorized purpose, and is proportional to public benefits. A nexus and proportionality are established between charges and benefits.

X X

State government helps communities that cannot help themselves, and helps them meet State regulations that they cannot fully cover.

X X

State government pays for legacy impacts, but only in cases where stressors cannot be identified or no longer exist. In some cases, legacy impacts may go unaddressed indefinitely.

X

State government uses a more coordinated and consistent funding approach across State agencies to increase return on investment, enhance accountability, and improve consistency and efficiency.

X X X


WORKING DRAFT 4-5

State funding leverages federal and private funding, includes flexibility to reflect local and regional conditions, and advances regional goals and investment priorities with grants and loans.

X X

State government favors funding mechanisms that: o Improve cost effectiveness, efficiencies, and

accountability. o Avoid stranded costs and funding discontinuity. o Leverage funding across State government agencies. o Increase certainty of desired outcomes.

X X X

Any novel mechanism used by the State should be designed to avoid impacts on local agencies’ ability to generate revenue for local activities.

X

Notes: CWP = California Water Plan


WORKING DRAFT 4-6

Funding to Implement Priorities and Actions

Identifying, analyzing, and recommending ways to implement the recommended actions presented in

Chapter 3 is essential to putting California on a more sustainable path. The first step is estimating the

cost of implementation. The funding options in Chapter 5 are based on this cost estimate.

The cost of implementing Update 2018 actions totals about $102 billion for capital and $200 million per

year for ongoing actions over the next 50 years. This requires an annual increase of $2–$4 billion in State

funding, of which a significant portion would provide increased funding for financial and technical

assistance to regional and local entities. (The $4 billion number represents an accelerated

implementation schedule.) Table 4-2 shows estimated funding needs for each of the five Update 2018

priorities. This approach, when informed by the Sustainability Outlook, will provide practical knowledge

by which decisions can be made regarding how to invest among the five priorities.

Notes:

Table summarized from information in Appendix A. Table columns and row totals may not sum correctly as a result of rounding. A significant portion of the estimated funding need will provide increased funding for financial and technical assistance to regional and local entities. Investment in the Chapter 3 recommended actions will result in cost savings and efficiencies.

Funding Mechanisms A mix of funding mechanisms must be implemented to provide the stable and sufficient funding for

capital (large magnitude, short duration) and ongoing (low magnitude, long duration) management

actions. Stable funding helps increase efficiency and return on investment for addressing many of

California’s most pressing issues. This list includes deferred maintenance; avoided costs associated with

planning, research, development, or construction disruptions; and minimization of stranded investment

from data gaps and inaccessibility.

Several current mechanisms can be used to fund the recommended actions. Update 2018 also

introduces several novel mechanisms that may work in combination with current mechanisms. The

novel mechanisms would supplement, not replace, current funding mechanisms. Simply replacing

current mechanisms with novel mechanisms would result in funding insufficient to implement the


WORKING DRAFT 4-7

recommended actions. This would also be inconsistent with the shared values and principles presented

in Table 4-1.

Each funding mechanism, whether current or novel, has a unique set of characteristics, including

applicability, feasibility, inter-annual reliability, and limitations. These characteristics were used to

assess the feasibility and trade-offs of funding mixes, or scenarios. Each scenario is comprised of a mix of

funding mechanisms and levels. The funding scenarios were used, in turn, to develop the funding

options in Chapter 5.

Tables 4-3 and 4-4 provide a list of existing and novel funding mechanisms, along with a comparison of

their respective characteristics. Table 4-5 shows the historical maximum and average funding from the

State General Fund and GO bonds.

Table 4-3. Summary of Current and Novel Funding Mechanisms


WORKING DRAFT 4-8

Table 4-4. Comparison of Current and Novel Funding Mechanisms for State Investments

Notes: Historically, different water management sectors have relied on different funding mechanisms. OMRR&R – Operations, Maintenance, Repair, Rehabilitation, and Replace GHG- greenhouse gases Table summarized from information in Appendix A.


WORKING DRAFT 4-9

Table 4-5. Historical Funding Levels of Current Funding Mechanisms (Based on Average and Maximum Historical Expenditures 2006–20151,2)

Funding Scenarios Several funding scenarios were developed to evaluate the plausibility and trade-offs of different

combinations of funding mechanisms. Each scenario represents a different contribution of mechanisms

to provide the additional funding called for in Chapter 3. The scenarios were compared with current

trends, which assume that average annual State, local, and federal funding levels remain unchanged

(see Table 4-5). By comparing the scenarios with current trends, a common frame of reference is

established to examine how benefits and impacts vary among the scenarios. The scenarios were used to

develop the funding options, which can be used by the governor, Legislature, and other decision-makers

to formulate funding policies needed to implement this plan.

The funding scenarios are as follows:

Scenario A: Emphasis on Borrowing – This scenario depicts the debt, and interest on the debt,

throughout the 50-year planning horizon, accompanied by increased borrowing. State general funding

remains at the historical average level. State GO bonds increase to pay for recommended actions; no

novel mechanisms are utilized. Local and federal funding remains at historical annual averages.

Scenario B: Emphasis on State General Fund – This scenario explores increasing appropriations from the

State General Fund without increased borrowing. State general funding increases to implement the

recommended actions. State GO bonds remain at the historical average level; no novel mechanisms are

utilized. Local and federal funding remains at historical annual averages.

Scenario C: Current Mechanisms at Maximum Historical Levels, with Novel – This scenario depicts a

strategic mix of all funding mechanisms. State general funding and GO bonds are utilized at maximum

historical levels to help implement the recommended actions. Novel mechanisms are used to fund the

remaining need (see Table 4-X, Scenario C). Local and federal funding remains at historical annual

averages.

Scenario D: State General Fund Replaces Need for Novel Mechanisms – This scenario uses general

funds instead of novel mechanisms. GO bonds are utilized at the maximum historical levels, while the

General Fund is increased to alleviate the need for any novel mechanisms. Local and federal funding

remains at historical annual averages.


WORKING DRAFT 4-10

Scenario E: Accelerated Funding – This scenario explores an increase in annual expenditures for

accelerated implementation of actions. State General Fund is utilized at the maximum historical level.

Novel mechanisms are utilized (see Table 4-X, Scenario E), and GO bonds are increased at the level

necessary to meet an accelerated implementation of the recommended actions. Local and federal

funding remains at historical annual averages.

Scenario F: Complete Curtailment of Borrowing – This scenario explores the trade-offs involved in

completely curtailing borrowing. Only State general funds and novel mechanisms are used to implement

the recommended actions. No new borrowing (in the form of GO bonds) is undertaken. Local and

federal funding remains at historical annual averages.

Findings There are many complexities, considerations, and unknowns surrounding the identification,

implementation, and administration of the most appropriate, feasible, equitable, and cost-effective

ways to pay for Update 2018 implementation. The funding scenario metrics and findings below provide

a common understanding of specific trade-offs among the different funding scenarios. The metrics and

findings helped determine the funding options presented in Chapter 5.

Funding Scenario Metrics

These funding scenario metrics, in essence, are the specific, quantifiable trade-offs used to assess the

funding scenarios.

• Total Annual Funding by Funding Mechanism — Represents annual amounts provided by each

mechanism for both ongoing and capital funding needs. This helps derive the proportional funding

amounts among of the mechanisms used in each scenario.

• Total Funding Required over Planning Horizon — Depicts the entire amount of State funding

required to implement the recommended actions over the next 50 years. This metric is particularly

useful for understanding the cost of borrowing.

• Annual Fiscal Impacts of Novel Mechanisms — Illustrates the relative magnitude of cost impacts

from novel mechanisms and their distribution in terms of households, individuals, property owners,

and taxpayers. These metrics are hypothetical and not intended to signal a specific funding

mechanism or literal distribution of costs among Californians. These are hypothetical and not

intended to signal a specific funding mechanism nor an actual distribution of costs among

households.

o Cost per Household — The equivalent cost per household, assuming 90 percent of households

have the ability to pay.

o Equivalent Cost per Capita — The equivalent cost per capita assumes 85 percent of the

population pays, assuming 85 percent of the total population has the ability to pay.

o Per Parcel — The equivalent cost per parcel, calculated as a flat amount per parcel.

o Dollars per $100 of Assessed Value of Property — The equivalent of an ad valorem tax rate in

terms of dollars per $100 of net assessed value.

o Per Acre — The equivalent of a per-acre charge on private land ownership to mimic assessments

or taxes based on acreage of property.


WORKING DRAFT 4-11

• Primary Payers — Identifies what portion of California’s population provides the funding. Categories

include urban water users, agricultural water users, income-tax payers, and property owners.

Funding Scenario Findings

If current trends continue, the Update 2018 recommended actions would go unimplemented. It is likely

that some current State funding would be redirected to sustain ongoing State activities, and thus leave

less funding available for State, regional, and local capital investment. If this were the case, State

funding for local assistance programs would be cut.

Using current trends as the backdrop, the results of exploring the trade-offs for each funding scenario

are summarized below and shown in greater detail in Table 4-6. Table 4-7 shows the annual fiscal

impacts of funding the recommended actions across the different scenarios. For every scenario, total

annual local and federal funding is assumed to remain at current levels of approximately $28 billion and

$800 million, respectively.

Scenario A: Rely Heavily on Borrowing — Historical average funding from State GO bonds would need

to be more than doubled to fully fund the recommended actions. Relative to current trends, this would

significantly increase debt and accrued interest (more than $240 million annually). The total cost over

the 50-year planning horizon would be $$$. Because GO bonds are intermittent and unpredictable, they

are not appropriate for funding ongoing activities. Moreover, borrowing to pay for ongoing State

activities is inconsistent with several shared values, including good stewardship of State government

monies and recognition of the cost of borrowing and the risks of indebtedness.

Scenario B: Rely Heavily on State General Fund — This scenario would require a considerable increase

(more than 10 times the historical average) in State General Fund appropriations to implement the

recommended actions. Historical average use of State GO bonds and an increased reliance on the State

General Fund would result in a total cost of $$ over the 50-year planning horizon. State General Fund

appropriations have a lower inter-annual reliability because they must compete with other State

services for funding. Because it is highly unlikely the State would increase General Fund appropriations

by 900 percent, this scenario is inconsistent with the shared value that calls for reasonable assumptions

about future revenues.

Scenario C: Utilize Current Mechanisms at Maximum Historical Levels, with Novel — A tax or

assessment, of about $10 per month for every household in California (above the poverty level),

combined with historical maximum General Fund and GO bond use, would fully fund the recommended

actions. The total cost over the 50-year planning horizon would be $$. Consideration of a number of

shared values and principles would be integral to the authorization and administration of any novel

mechanism. An example would be no redirection of current levels, or deferral of future increases, in

General Fund or GO bonds. Novel mechanisms also must improve cost effectiveness and efficiency, as

well as assure value. Any new tax or assessment would require legislation.

Scenario D: Utilize State General Fund to Replace Need for Novel — This would require an increase of

more than six times the historical average of State General Fund appropriations, while sustaining the

historical maximum funding from GO bonds. The total cost over the 50-year planning horizon under this

scenario would be $$. There are several shared values and principles that would be integral to the


WORKING DRAFT 4-12

authorization and administration of such a large increase in General Fund appropriations. They include

no redirection of GO bond or other existing mechanisms, as well as assurances regarding value, cost

effectiveness, and efficiency.

Scenario E: Accelerated Funding — An accelerated implementation of the recommended actions would

require an increase in funding from State general funds (60 percent), more than doubling of State GO

bond funding, and the implementation of novel mechanisms. The total State cost over the 50-year

planning horizon under this scenario would be $$. An accelerated funding scenario may provide a more

balanced approach to funding (as each State funding mechanism is increased), but significant challenges

remain, including:

• Significant debt accrued because of increased State GO bonds ($260 million per year).

• Implementation of novel funding mechanisms would require legislation for a new tax or

assessment.

• May overwhelm State and local institutional capacity to perform work. Examples include initial

shortages in staffing or expertise.

Because many investments would involve cost-sharing to implement all management actions under this

scenario, existing local funding would need to double, State funding would have to almost double, and

federal appropriations would need to be increased to historical annual maximums.

Scenario F: Pay as you Go — Paying for the recommended actions without borrowing would result in an

increase in State General Fund appropriations of more than eight times the historical average. Novel

mechanisms would also need to be implemented at a magnitude of less than $14 per month from every

household in California (above the poverty level). The total cost over the 50-year planning horizon under

this scenario would be $$. Novel mechanisms of this magnitude likely exceed the public’s willingness

and ability to pay and is not likely to be politically viable because such a mechanism would require

legislation. Any new tax or assessment would require legislation.


WORKING DRAFT 4-13

Table 4-6. Summary of Scenario Tradeoffs


WORKING DRAFT 4-14

Table 4-6. Summary of Scenario Tradeoffs

Notes: 1 Table summarized from information in Appendix A. Historic annual average expenditures are based on best available information from California Department of Finance and engineering judgement.. 2 Other includes designated special funds, user fees, and existing debt service. 3 Table columns and row totals may not sum correctly due to rounding.


WORKING DRAFT 4-15

Table 4-7. Annual Fiscal Impacts of Funding Scenarios

Cost per Household1,2 (90% Pays)

Cost per Capita2,3 (85% Pays)

Cost per Household1,2 (90% Pays)

Cost per Capita2,3

(85% Pays)

Cost per Parcel4

Dollars per $100

Assessed Value4

Cost per Acre5

Taxpayers

Taxpayers

Taxpayers Ratepayers

Property owners

Taxpayers


Property owners


Property ownersNotes: Table does not include local or federal funding needed to complement State funding and meet all water management needs. Columns and rows of table are not additive This table represents hypothetical implications and is not intended to signal a specific funding mechanism nor an actual distribution of costs among Californians. Table summarized from information in Appendix A. 1 Number of household estimates (13,307,614) and persons per household (2.79) are from California Department of Finance County/State Population and Housing Estimates, 1/1/2017 (http://www.dof.ca.gov/Forecasting/Demographics/Estimates/E-1/). 2 Number of households and persons under the poverty line are from American Community Survey, Percentage Of Families And People Whose Income In The Past 12 Months Is Below The Poverty Level (http://www.dof.ca.gov/Reports/Demographic_Reports/American_Community_Survey/). 3 Population estimates are from California Department of Finance State/County Population Estimates with Annual Percent Change (http://www.dof.ca.gov/Forecasting/Demographics/Estimates/E-1/). 4 Number of parcels (11,649,442) and net assessed evaluation ($4,604,886,582,000) are based on FY 2014-2015 Secured Local Tax Roles. 5 Private land ownership in California (46,103,707 acres) was estimated based on public/private ownership maps from CALFire California Multi-Source Land Ownership (http://frap.fire.ca.gov/data/frapgisdata-sw-ownership13_2_download) and total California acreage (99,698,701 acres) from U.S. Census Bureau Quickfacts California (https://www.census.gov/quickfacts/CA) 6 Taxpayer refers to all tax (income tax payers, corporate taxes, sales and use taxes) and revenue sources for the State general fund. Ratepayer refers to water use or other relevant ratepayers (urban and/or agricultural) or other identified beneficiaries.


WORKING DRAFT 5-1

Chapter 5. Implementation Plan and Funding Options

Managing water for a sustainable future requires implementation of critical near-term actions and a long-

term commitment to advancing Update 2018’s five innovations. Implementation can only occur through

significant and strategic investment, cooperation and collaboration of State, federal, tribal, and local

agencies, and tracking of progress — all of which enable decision-makers to manage for sustainability by

adjusting to changing conditions. Successfully managing for sustainability requires collaborative and

strategic leadership, as well as increased awareness and active participation on the part of all Californians.

Bringing this Water Plan to fruition

will result in a shift from reactionary

to proactive and adaptive

management, and in more effective

water policy and investment. To that

end, this chapter provides an

actionable five-year plan, with an

emphasis on funding and

implementing the recommended

actions described in Chapter 3. By

implementing those actions, the State

will effectively empower local

agencies to fulfill their crucial role in

managing California’s water

resources for sustainability.

Implementing Update 2018

Innovations

Update 2018 produced several innovations that taken together represent a practical end-to-end strategy for

water resources sustainability. These innovations embody significant stakeholder collaboration and

investment. Significant return on investment will be realized through their implementation, continued

refinement, and broad use. The five innovations of Update 2018 are:

1. Statewide Water Resources Sustainability — The operational description of statewide

sustainably enables planners and decision-makers to create policy and track progress in advancing

four societal values — public health and safety, healthy economy, ecosystem vitality, and

opportunities for enriching experiences.

2. Sustainability Outlook — The Sustainability Outlook is a method of collecting, organizing, and

standardizing data to evaluate the status and trends of water resource conditions in terms of the

four societal values. Applying this method at a regional scale provides mutual understanding of

resource limitations, management deficiencies, and shared intent in identifying State policy and

investment priorities.

3. Actions for Sustainability — Update 2018 channels prior updates and other State plans into a

feasible set of actions consistent with State government’s responsibilities for supporting and

investing in public benefits for sustainability. The actions presented in Chapter 3 are well-vetted


WORKING DRAFT 5-2

and represent improved alignment of State agencies, as well as empowerment and capacity-

building for regional water management.

4. Funding Update 2018 Implementation — Update 2018 provides an estimate of funding needs

and funding options for implementing the actions for sustainability. The funding options, with

acceptable trade-offs, are plausible and can be used by the governor, Legislature, and other

decision-makers to formulate funding policies that meet Californians’ funding preferences and

priorities. This chapter includes an implementation schedule, identifies implementation roles, and

presents options for paying for the actions recommended in Chapter 3.

5. California Water Plan Annual Report — This annual report will highlight accomplishments

and provide progress assessments for each of the five Update 2018 priorities. Based on these

assessments and any emerging challenges, the report will recommend refinements to priorities,

actions, roles and responsibilities, policies, and/or legislation to ensure continued progress.

Timing of Recommendations

Consistent with the Governor’s California Water Action Plan (2016 update), it is imperative that

California acts NOW to set the foundation for the next 50 years. Early activities are centered on

authorization and funding for State agencies to initiate activities that address urgent needs. Subsequent

actions target long-term implementation, monitoring, and adaptation to change. Table 5-1 presents the

anticipated timeline for implementation of Update 2018 policy recommendations and prioritized actions.


WORKING DRAFT 5-3

1 2 3 4 5 11-20 21-30 31-40 41-50

2019 2020 2021 2022 2023 2029-2038 2039-2048 2049-2058 2059-2068

Societal Value Legislation

State Agency Alignment

Watershed Sustainability Planning Outreach and Recommendations

Lead Agency Definition

Tribal Involvement with Regional Planning Efforts

State Contracting with Tribes

Programmatic Environmental Compliance Task Force

Ecosystem Restoration Project Permitting

Delegation of Federal Permitting

Cooperative Agreements

Climate Science and Monitoring Program

Comprehensive Water Resources Data Collection and Management Program

Watershed Sustainability Outlooks

Thematic Plans

Plan Alignment

Statewide Water Storage Reconnaissance Program

Regional Engagement in Update 2023

State Agency Performance Tracking and Reporting

Reporting Requirements for State Funding

Disadvantaged Community Liaisons

Disadvantaged Communities Engagement in Integrated Regional Water Management

Water Resources Education

Statewide Water Management System Operations and Maintenance Assessment

ProgramStatewide Water Management System Operations and Maintenance Modernization

ProgramStatewide Water Management System Assessment Program

Statewide Water Management System Modernization and Rehabilitation Program

Statewide Green Infrastructure and Working Landscapes Task Force

Integrated Land Use and Water Management Implementation Program

Investment Prioritization

Removal of Barriers

Novel Funding Mechanisms

Key:

Provide Sufficient and Stable Funding

Policy Recommendation / Prioritized Action

Year



Provide Water Managers Resources, Knowledge, Skills, and Tools Needed for Data-Driven Decision-making


6-10

2024-2028

Legislation - Authorization/Funding Implementation Note: Details on specific activities for year 6 and beyond will be developed in subsequent CWP Updates.


WORKING DRAFT 5-4

First Five Years, 2019–2023

The first five years focus on actions the State will initiate as necessary precursors for moving toward

Update 2018’s long-term vision. Activities include working with the Legislature to initiate legislation that

may be needed to authorize or fund recommendations presented in Update 2018, and collaboration among

State agencies to plan for and begin implementing the recommendations.

Improving government alignment, providing sufficient and stable funding, and improving regulatory

framework set the stage for better-informed decisions and more effective and efficient investment in

maintaining and improving the state’s infrastructure and ecosystems. Early investments in these strategic

actions will provide the greatest return on investment for the more than $100 billion in capital and

ongoing expenditures to modernize and rehabilitate water systems (grey and green infrastructure). The

first five years of implementation focus on these actions.


This effort is foundational to achieving the other four Update 2018 priorities and must be initiated early

and be completed in the first three years. This will involve new legislation to authorize activities and

funding, as well as commitments by State agencies to operate in alignment with the societal values.


These early activities fund and facilitate productive conversations, at all levels of State government, on

improving the existing regulatory framework. These conversations will focus on developing and

implementing strategies to make the regulatory statutes and permitting more efficient and effective. New

legislation will likely be required to authorize funding, and the Administration will need to provide

direction to State agencies.

Provide Resources, Knowledge, Skills, and Tools Water Resource Managers Need for Data-Driven

Decision-Making

Many efforts to provide the necessary data, skills, and tools have been sporadic and lacked longevity.

Early activities equip all levels of State government and regional partners with the ability to manage water

sustainably and efficiently by using leading edge technologies. Long term, this effort will allow for more

effective project and program analysis, tracking, and reporting — all based on specific, measurable

outcomes. There are two particularly time-sensitive actions in this category, and they both relate to plan

alignment and regional engagement in Update 2023. It is likely that new legislation will be required to

authorize funding, and the Administration will need to provide direction to State agencies.


The intent of these activities is to assess and attend to existing infrastructure before focusing on

modernization and new infrastructure. Assessment is a vital first step is to collect the intelligence

necessary to prioritize infrastructure and ecosystem needs and to direct funding toward those needs. Most

of these efforts will be initiated in the first five years; assessments will be completed within a few years,

while modernization and rehabilitation are considered long-term actions and will be completed over time.

It is likely that new legislation will be required to authorize funding, and the Administration will need to

provide direction to State agencies.


WORKING DRAFT 5-5

Provide Sufficient and Sustainable Funding

Codifying the societal values in legislation allows for State investment priorities and incentives to be

established based on those values, and doing so commits State government to sustainability, resiliency,

and cost effectiveness. Early initiation involves identifying methods for removing funding barriers to

local and regional projects and exploring novel funding mechanisms. The results of both activities will be

incorporated as recommendations in Update 2023.

The Long Term, 2024–2068

Implementation of some long-term actions initiated during the first five years will continue through 2068.

The five innovations of Update 2018 provide a foundation for future Water Plan updates by supporting

greater planning consistency and efficiency, as well as more practical and timely decision-support. Future

updates will reflect accomplishments while also adapting based on emerging knowledge, challenges, and

priorities. The plans will identify near-term actions and re-calibrate the Water Plan to maintain progress

toward a long-term vision for future water management sustainability.

Funding for the State to Implement the Water Plan

State Funding Options

Implementation of Update 2018 will require considerable resources as well as time-sensitive, sequenced

actions by State government and decision-makers. It will take a balanced mix of investments and funding

mechanisms to manage California’s water sustainably into the future.

The two State funding options described herein are intended to be used by the governor, the Legislature,

and other decision-makers to formulate effective and equitable funding strategies. The strategies will

appropriate funds and direct State agencies to implement Update 2018 recommended actions and provide

incentivize outcomes that only local and regional entities are capable of accomplishing.

• Utilize Current Mechanisms at Maximum Historical Levels, with Novel — State General

Fund and general obligation bonds are utilized at maximum historical levels to help implement

the recommended actions. Novel mechanisms are used to fund the remaining need. Local and

federal funding remains at historical annual averages. This option depicts a strategic mix of all

funding mechanisms.

• Utilize State General Fund to Replace Need for Novel — General obligation bonds are utilized

at maximum historical levels, while the State General Fund is increased to alleviate the need for

novel mechanisms. Local and federal funding remains at historical annual averages.

These plausible options emphasize different mixes of funding mechanisms (described in detail in Chapter

4) and are meant to be viewed comparatively (see Table 5-2). Neither option is recommended for

implementation “as is.” The Administration and the Legislature are encouraged to utilize the critical

insights provided by the options to help balance funding decisions with prevailing policy drivers, such as

the amount of debt the State will tolerate, the feasibility of novel mechanisms in a given legislative

session, and urgency of infrastructure needs.

Implementing the recommended actions in Update 2018 over the next five years will require additional

General Fund dollars; appropriation of remaining existing bond funding; passage of a new water bond;

and investigation of new, novel funding mechanisms. If this funding is not secured, the recommended

actions and ongoing management actions will likely go unfunded, resulting in continued degradation of


WORKING DRAFT 5-6

water management systems; continued deferred maintenance; poor planning; increased risk, especially to

vulnerable communities; and continued trending away from sustainability.

As elected officials determine the funding mechanisms they are interested in advancing, the Water Plan

will continue to evolve the analysis and inform the implementation aspect of future Water Plan Annual

Reports (described later in this chapter).

[PLACEHOLDER FOR YEAR-BY-YEAR FUNDING]

Consistency with Shared Funding Values and Principles

State policy-makers are encouraged to consider the following ways to remain consistent with the shared

values and principles summarized in Table 4-1. Doing so will enhance the effectiveness, efficiency, and

political viability of authorizing and funding the implementation of Update 2018, as well as other State-

funded water investment. [Note to reviewer: this section is still under development and requires

significant stakeholder input.]


WORKING DRAFT 5-7

Option Total

Funded

Funding Mechanisms

Outcomes

General Fund General Obligation Bonds Novel Mechanisms

$ % Change Per capita $ % Change

New Debt Service

Per Capita $

Per Capita /

Household /

Parcel $

% Change

Current Trends Continue Frame of Reference

•

Utilize Current Mechanisms at Maximum Historical Levels, with Novel

•

Utilize State General Fund to Replace Need for Novel

•

Key:

<add key>

Notes:

• Table does not include local or federal funding needed to complement State funding and meet all water management needs.

• <add notes>


WORKING DRAFT 5-8

State Government’s Implementation Role and Responsibility

Implementing the recommended actions in Update 2018 is a shared responsibility of federal, State, and

local agencies and other entities. It will require both effort and expenditure, involve new collaboration

and alignment, and span multiple decades. Local and regional entities will continue to be primarily

responsible for funding projects and programs that create local benefits and to participate in larger,

systemwide projects that benefit them individually. The State will continue to take leadership in activities

for which it is uniquely suited or positioned, such as leading statewide sustainability efforts, activities to

characterize the potential effects of climate change on the State’s water and natural resources, and helping

to ensure all California’s have access to safe water supplies.

Table 5-3 highlights the involvement of the various branches of State government in implementing the

recommended actions — State agencies, the State Legislature, and the Executive Branch (the Governor’s

office).


WORKING DRAFT 5-9

Successful implementation will be at the direction of the Governor’s office and include the leadership and

participation of the agencies in the Executive Branch and the State Legislature. Success will also be

founded on continued partnerships between State, local, and federal agencies and the public. These

partnerships help align State priorities with regional needs, direct funding from various sources to priority

areas, and open dialogue about the effectiveness of actions in addressing California’s water management

challenges. Working together will help maximize the many mutual benefits of implementing Update

2018. For example, regional water management groups can help shape reforms by partnering with DWR

on various initiatives, such as the Programmatic Environmental Compliance Task Force, or

implementation efforts related to the Open and Transparent Water Data Act (Assembly Bill 1755).

Partnerships at the regional scale are equally important in characterizing needs and identifying multi-

objective projects aligned with Californian’s values and desired outcomes. Partnerships with the State

Legislature are needed to advance new legislation, and reforms are needed to implement sustainable water

management actions and funding mechanisms.

California Water Plan Annual Report

Change is a constant in California, whether it be our variable hydrology, our priorities, or our challenges.

California’s path to sustainable water management is no different. Emerging issues and unanticipated

outcomes from actions and policies will require adaptive management while the recommended actions are

implemented. On an annual basis, DWR will prepare an assessment of implementation progress to ensure

progress and to provide accountability. It will be based on progress-monitoring to be conducted by both

DWR and other State departments and agencies throughout the preceding year.

Similar to the annual California Water Action Plan Implementation Report, the California Water Plan

Annual Report will highlight accomplishments. It will also report on progress specifically toward

implementing Update 2018 actions for sustainability and identify impediments for actions that have not


WORKING DRAFT 5-10

been implemented. In collaboration with Water Plan advisory groups and State Agency Steering

Committee, the annual Water Plan Annual Report will include recommendations to overcome

implementation implements, as well as refinements to priorities, actions, roles and responsibilities,

policies, and/or legislation, to ensure continued progress.

This annual status report will inform State policy and investment by equipping decision-makers and

stakeholders with an annual checkup on implementation of key actions. It will identify gaps and urgent

water management needs with a frequency that informs lawmaking as it occurs. The status report can be

used to address challenges, such as drought and flood, as they emerge. This report will provide the

foundation for performance-tracking by highlighting the actions and investments for which the outcomes

need to be measured to determine return on investment and effectiveness of policies and actions. The first

report will be released in 2019 and every year thereafter except the years ending in ’03 and ’08 — when

Water Plan updates are released. It will provide a timely assessment of current conditions and policy

priorities before and during the five-year Water Plan update cycles. As the Sustainability Outlook is

refined and more thoroughly applied at regional scales, annual reports will gradually assess the

sustainability indicators identified in Chapter 2 and report on how effective actions and polices were in

moving the state toward successful water outcomes. This learn-and-adapt cycle will enable decision-

makers to adjust actions and priorities, reinvigorate partnerships, and continue to navigate a path toward

water resource sustainability.

The Way Forward

Four essential steps are required to move California toward Update 2018’s long-term vision: (1) strategy

formulation, (2) strategy implementation, (3) collaboration and partnerships, and (4) evaluation and

adaptation. Update 2018 represents an extensive strategy formulation process that has resulted in a shared

vision and practical guidance regarding implementation and adaptation. Update 2018 is designed to be

actionable. But to produce results State government must continue to fulfill its leadership role, and State

agencies and regional partners must be provided with the tools, authorizations, and funding to implement

the Water Plan.

Among many potential uses, DWR would like to see Update 2018 utilized in these specific ways:

• Elected officials and stakeholders use this Update 2018 to inspire action and unite constituents and

representatives behind the long-term vision (Chapter 1) and desired outcomes described in the

Sustainability Outlook (Chapter 2).

• Administrations and the State Legislature use the “Schedule for Implementing Recommended

Actions” (Table 5-1), as well as accompanying details found in the recommended actions in Chapter

3, to inform the type, timing, and content of future policy and legislation. These recommended actions

and the “Funding Options” section represent guidance from the state’s water communities and,

together, provide a policy template for developing funding authorizations and policies.

• Local and regional entities use the California Water Plan to promote State policies that benefit

respective interests, areas, and jurisdictions. They also begin planning, aligning, and partnering based

on Update 2018’s guidance for empowering regional water management (Chapter 3).

• Update 2018 provides a framework for accountability for timely and cost-effective action (Table 5-1)

that complies with the shared funding values and principles (Table 4-1). It does so by tracking


WORKING DRAFT 5-11

progress (Chapter 2) and annual reporting (California Water Plan Annual Report, as described in this

chapter).

Update 2018 is only a beginning. As our understanding, uses, and stressors of California’s water

resources continually change over time, elected officials and water managers need to leverage and honor

past plans and commitments while supporting a long-term, sustained effort. Successful implementation of

this California Water Plan requires early authorizations and funding (Table 5-1), a commitment by State

and local water managers to foster and sustain partnerships, and adaptive management. Meeting Update

2018’s five priorities, implementing its recommended actions, and applying and refining its innovations

over the long term will enhance mutual understanding and shared intent, implement recommended

actions, stabilize funding, and provide more timely decision support. Doing so will ensure that water

sustainability strategies are effective and rooted in what Californians value.

water plan update 2018 draft reviewer’s guide · 1/9/2018 · california water plan update 2018...

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