Poway council approves amended water-rights deal with San Diego, authorizes $441,866 appropriation

The Poway City Council on April 21 approved an amended water-rights agreement with the City of San Diego and authorized a $441,866 appropriation from the water fund balance to cover retroactive replacement-water charges for calendar years 2017 through 2025.

Utilities administrator Carlos Cortez told the council the agreement updates a 1968 arrangement tied to construction of the Poway Dam, replaces an absent meter with a new metering requirement, and resolves a decades-long billing lapse between the two agencies. "We're seeking to resolve a 20 year lapse in San Diego's administration of the 1968 water rights agreement," Cortez said, summarizing the purpose of the update.

Under staff recommendations, the city would use an updated measurement methodology where no meter exists (a proxy method that treats Lake Poway inflow as roughly 1% of Lake Hodges inflow) until a metering device is installed. Cortez said the city is in permitting and design to replace an existing culvert with a metering device, a project budgeted in the cost-of-service study at roughly $150,000.

Cortez said the negotiated retroactive lump-sum settlement totals $534,266 for an estimated 531 acre-feet covering 2017 through 2025. Poway has budgeted $92,400 in fiscal-year 2026 funds; the resolution authorizes the additional $441,866 appropriation to clear the retroactive charges. "This agreement also establishes a credit mechanism that benefits Poway," Cortez said, describing a 10-year credit for releases from Hodges Dam so certain releases will not require replacement deliveries.

Councilmembers questioned whether San Diego would pay cash when releases exceed local inflow; Cortez said Poway would receive a credit rather than a cash payment, and clarified that staff does not expect the settlement to change the city's water rates because the project and its O&M were included in prior cost-of-service planning. "This project and this agreement shouldn't have any impact on water rates," Cortez said.

Councilmember Pikes moved to approve the resolution and Mayor Voss seconded. The clerk called the roll and each member voted "aye." The motion passed unanimously.

The resolution also directs the city manager to execute non-substantive changes to the agreement and reestablishes an annual billing cycle with invoices due March 15. Staff said the new metering device must be installed within five years to replace the proxy method and improve future measurement accuracy.

The council approved the amendment and appropriation; the city manager is authorized to finalize the agreement and related administrative adjustments.