The Truckee River Operating Agreement (TROA) is an agreement among five parties:  California, Nevada, the Pyramid Lake Paiute Tribe (PLPT), the United States, and the Truckee Meadows Water Authority (TMWA).  There are approximately ten other parties signing which include:  The Cities of Reno and Sparks, Washoe County, water purveyors in the Truckee area, and the Sierra Valley Water Company which takes water from the Truckee system to the Loyalton/Sierra Valley area.  When implemented, TROA will allow for a congressionally authorized interstate allocation of water between Nevada and California and change the operations of the Truckee River system to accommodate multiple beneficial uses for drought supply, improve spawning flows for endangered and threatened fish species, improve water quality and California water use and storage.  In addition, operations will enhance riparian habitat, re-establish river canopy, enhance reservoir releases, improve recreational pools in the reservoirs, and improve emergency draw-down procedures for Lake Tahoe.

Section 1.E.4 of the TROA requires that the Cities of Reno and Sparks and Washoe County (the Entities) allocate 6700 acre-feet of Truckee Meadows Truckee River (Orr Ditch decreed) water rights to improve water quality within the Truckee River.  The Entities had anticipated that the decreed Truckee River water rights appurtenant to roadways and street right of ways within each jurisdiction would produce sufficient water rights to meet this requirement.  In 2006, the Entities selected TEC Engineering to perform water rights research associated with the Street Rights of Ways within each jurisdiction.

The Entities have accumulated 3952.08 acre-feet of water rights towards the obligation, which consists of 3499.18 acre-feet from streets and rights of ways and an acquired block; TMWA, through funding from Western Regional Water Commission (WRWC) for the specific purpose of satisfying the Obligation, acquired 452.90 acre-feet of water rights which it has transferred to the Entities.  Each Entity retains ownership of the water associated with their streets and rights-of-ways.  As to the acquired block of water rights (452.90 acre-feet), the Entities will each own one-third interest.

To address the remaining shortage, funding available from federal sources was sought.  Numerous meetings with Senator Reid’s Office, the Entities and the PLPT, resulted in Great Basin Land and Water (GBLW), a Nevada non-profit corporation, to receive, on behalf of the Tribe, grant funds (Terminal Lakes Assistance Grant),  in the sum of $7 million to buy water for the purpose of satisfying the balance of the Entities 6700 acre-feet obligation.  With this grant funding, GBLW will acquire 2747.92 acre-feet of Truckee River water rights from the Truckee Meadows Water Authority.  This water when added to the water rights accumulated by the Entities will total the sum of 6700 acre-feet to satisfy the obligation (3499.18 + 452.90 + 2747.92 = 6700.00).  The attached agreement memorializes this and is the final step for satisfaction of Obligation arising from Section 1.E.4 of TROA.

The agreement is also to assure the Entities that the water acquired by GBLW with the grant funds, which will be owned and managed by the PLPT, is credited toward satisfaction of the obligation of Reno, Sparks and Washoe County to provide 6,700 acre-feet of water rights as set forth in the Truckee River Operating Agreement.  The agreement further provides that the water acquired with grant funds is to be used for water quality purposes.  The agreement provides a timeline (the end of this calendar year) where the Entities are to file the transfer applications with the State Engineer for the purposes of water quality.  Moreover, upon full execution of this agreement by all parties, PLPT deems Section 1.E.4 of TROA (the 6700 acre-foot obligation; the 1.E.4 Agreement) to be fully and completely satisfied. 

This agreement was approved by the Tribe on August 19, and will be considered by Washoe County on August 25th and City of Reno on August 26th.

Staff recommends approval.

See Background.

1. City Council could approve the agreement as outlined by Staff.
2.  City Council could reject the agreement and provide direction to the City Manager.

I move to approve an agreement (AC-5192) regarding satisfaction of the obligation of the City of Reno, City of Sparks and Washoe County Pursuant to Section 1.E.4 of the Truckee River Operating Agreement to provide 6,700 acre feet of water rights.