CC Minutes - 06/07/10 Work Session

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EWEB's plan. She explained that the initial estimate was for 150 million gallons per year, with a minimum purchase quantity by month of eight million gallons. She said the maximum amount of water Veneta could take from EWEB, as outlined in the contract, was four million gallons per day (MGD). She stressed the importance of noting that EWEB would not be providing all of the water Veneta needed; it would continue to use its water sources. Ultimately, the amount of water Veneta would use represented less than one percent of EWEB's current water sales to retail customers. She said the point of sale would be at the Eugene city limits. She underscored that this was a surplus water contract; the supply to Veneta would be discontinued should there be a water shortage in Eugene. Mr. Clark thanked Mr. Taylor and Ms. Smith. He appreciated the chance to learn more about the water rights. Ms. Taylor asked who would get the water rights if EWEB lost them. Mr. Taylor reiterated that the rights would be lost and the next applicant in line would get them and EWEB, if it made a new request, would be placed at the back of the line. In response to a follow -up question from Ms. Taylor, Mr. Taylor explained that EWEB had just expanded its Hayden Bridge Filtration Plant and increased its water capacity. He pointed out that the drop in water usage caused by the departure of Hynix and the service change to Glenwood represented a larger amount of water than Veneta would use. Ms. Taylor asked if it would cost the City of Eugene to put the pipeline in to Veneta. Mr. Taylor reiterated that the responsibility for the pipeline fell solely to Veneta. Ms. Taylor asked how this would minimize rate increases. Mr. Taylor responded that the water utility had high fixed costs and the increase in the amount of water sold would not increase those fixed costs, but it would spread those costs out over a greater number of customers. Ms. Taylor asked what was meant by "junior users." Mr. Taylor explained that they were the users who had come after the point in time at which the 1961 water right had been granted. He said if for some reason the flows from the McKenzie were not sufficient to meet that in- stream water right, the junior users would be regulated off to ensure that the river had the flow in it for EWEB's water right. Ms. Taylor asked where the "salmon [came] in." Mr. Taylor responded that the in- stream flow was the protected quantity of flow needed to protect aquatic species within the river. Ms. Taylor asked if that would come ahead of junior users and Veneta. Mr. Taylor replied that, ultimately, it came ahead of EWEB. Ms. Taylor observed that the contract had already been signed and asked what they were talking about. Intergovernmental Relations Manager Brenda Wilson replied that this was not just about the sale of water to Veneta, it was about certifying and protecting this particular water right and the Veneta contract would help to certify the first quarter of that. Mr. G. Brown asked what was meant by a "reasonable timeframe" within which to perfect the water right. Mr. Taylor responded that the 2005 legislation had put sideboards on all future water rights, directing that they be perfected within 20 years. He said there were entities in Oregon that had received extensions out to 50 years. In response to a follow -up question from Mr. G. Brown, Mr. Taylor explained that the state had told EWEB that if the water right was not perfected within 20 years, EWEB would be at a higher risk of losing it or of receiving additional conditions that would make development of that water right difficult. MINUTES —Joint Meeting - Eugene Water & Electric Board and Eugene City Council June 7, 2010 Page 3