TO: Napa County Flood Control and Water Conservation District
FROM: Richard Thomasser - District Manager
REPORT BY: Christopher Silke - Engineering Manager, Water Resources
SUBJECT: Amendment No. 5 with Somach, Simmons & Dunn Agreement No. F-103 (FC)
RECOMMENDATION
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Approve and authorize Amendment No. 5 to Agreement No. F-103 (FC) with Somach, Simmons & Dunn with an annual maximum cost of $120,000 for fiscal year 2024-25 for specialized services necessary to advise, assist, and represent the District in its dispute over proper interpretation of the 2013 Area of Origin Settlement Agreement with the California Department of Water Resources. (Fiscal Impact: $120,000 FY24-25 only Expense; Flood District-Water Supply Contracts; Budgeted; Discretionary)
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BACKGROUND
Napa County Flood Control and Water Conservation District (District), Solano County Water Agency (Solano), and City of Yuba City (Yuba City) (collectively, NOD 3 Contractors) are in dispute of the California Department of Water Resources' (DWR) Water Year 2020 accounting for the NOD 3 Contractors. Specifically, the NOD 3 Contractors disagree with DWR's interpretation of their respective 2013 Area of Origin (AOO) Settlement Agreements as implemented through the State Water Project (SWP) contract provisions that concern use and carryover of each contractor's unique Table A Allocation provided by their Settlement Agreement. For Water Year 2020, DWR's determinations are documented in its 2020 Finalization Report issued by DWR on January 15, 2021. On February 18, 2021, DWR issued a revised version of the 2020 Finalization Report to Yuba City correcting an accounting error for Yuba City's use of carryover. DWR's determinations resulted in a loss of water in carryover storage for each contractor as follows: District: 1,208 acre-feet (AF); Solano: 2,533 AF; and Yuba City: 960 AF; for a total loss of 4,701 AF. The estimated financial harm to District is $745,251.
NOD 3 Contractors hired Somach, Simmons & Dunn (SSD) to resolve the AOO water allocation dispute and submit a government claim. After unsuccessful settlement discussions, on July 14, 2022, NOD 3 Contractors filed a formal complaint against DWR in Sacramento County Superior Court. For Fiscal Year 2024-2025, the District has incurred additional legal expenses due to extensive discovery and in anticipation of mediation and trial. The District wishes to continue receiving specialized services from SSD to advise, assist, and represent it.
Approval of Amendment No. 5 to Agreement No. F-103 with Somach, Simmons & Dunn appropriates an additional $60,000 for a new maximum of $120,000 for Fiscal Year 2024-25 to provide continued legal representation.
Requested Actions:
1. Approve and authorize Amendment No. 5 to Agreement No. F-103 (FC) with Somach, Simmons & Dunn
FISCAL & STRATEGIC PLAN IMPACT
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Is there a Fiscal Impact? |
Yes |
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Is it currently budgeted? |
Yes |
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Where is it budgeted? |
Fund 8000, Subdivision 8001500 |
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Is it Mandatory or Discretionary? |
Discretionary |
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Discretionary Justification: |
Legal analysis for negotiations is needed |
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Is the general fund affected? |
No |
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Future fiscal impact: |
No direct impacts in future fiscal years will result from this particular action. |
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Consequences if not approved: |
Staff will not have the benefit of expert legal services to support dispute with DWR |
ENVIRONMENTAL IMPACT
ENVIRONMENTAL DETERMINATION: The proposed action is not a project as defined by California Code of Regulations, title 14, section 15378 (State CEQA Guidelines) and, therefore, CEQA is not applicable.