Vacaville council authorizes marketing up to 3,000 acre-feet of raw water from wet-year surplus

Vacaville City Council on June 10 authorized the city manager to execute contracts to market and, if a buyer is found, sell up to 3,000 acre'feet of raw water held in San Luis Reservoir or Lake Berryessa. The authorization covers agenda items E and F and allows staff to finalize agreements that would direct proceeds to the utility fund for capital projects.

Director of Utilities Justin Cole told the council the city sells raw water in wet years when state allocations are higher than typical. "This is something we've done, last year and a couple of years before," Cole said. He said last year the city sold water and realized "almost a half a million dollars to the utility fund" that was used for capital improvement projects.

Key details - Maximum authorization: up to 3,000 acre-feet to market/sell (cap specified by staff). - Sources: raw water stored in San Luis Reservoir and Lake Berryessa; the city also referenced allocations from the State Water Project and the Solano Project. - Recent context: Cole said the city received a 50% allocation from the State Water Project this year on an allocation of 8,978 acre-feet; Solano Project allocations and stored carryover in Lake Berryessa were also discussed. Cole noted that when Lake Berryessa spilled last year the city lost roughly 20,000 acre-feet of carryover. - Financials: Cole said the city previously sold water and received about $500,000; he estimated that water bought from SID costs about $60 to $80 per acre-foot, which could make a spilled carryover worth "a couple million dollars" if sold before loss.

Why it matters: selling surplus raw water in wet years is a cash'management tool for Vacaville's utilities. Proceeds reduce net costs for infrastructure projects in the utility fund, but the city emphasized that transactions are opportunistic: staff said they do not have a buyer in hand and transactions typically move quickly when the market exists.

Council action and public comment The council opened the topic to public comment; a member of the public asked how the city could be in a position to sell water while also managing well capacity issues, noting community concerns about utility reliability. Justin Cole and staff explained the difference between treated and raw water capacity and said the sales would be of raw water; the city would maintain treated water capacity to meet local needs. Councilmember Ken Stockton moved to approve; the motion was seconded and carried by vote.

Ending Staff said the authorization was intended to give the city manager authority to execute a sale if a buyer is identified; no buyer had been identified at the time of the meeting. If transactions go forward, staff will return as required with documentation of the agreements and will use sale proceeds for utility capital improvements.