z 2023-02-07 CC Staff Report - IID Energy Study & OptionsPUBLIC SPEAKER: Board Member and Secretary Aileen Alvarez with Shay's Warriors —
introduced herself, spoke about the services the organization provides to cancer
survivors, and thanked Council for the starter grant.
MOTION — A motion was made and seconded by Councilmembers McGarrey/Sanchez
to approve the second round of Community Services Grants for fiscal year 2022/23 as
detailed below for a total combined grant funding of $23,000:
• Angel Force $0
• Angel View $3,500
• Coachella Valley Horse Rescue $4,500
• Coachella Valley Volunteers in Medicine $5,000
• Friends of the Desert Mountains $4,500
• La Quinta High School AVID* $0
• Riverside County Sheriff Explorer Post 503 $5,000
• Shay's Warriors* $500 starter grant
Motion passed unanimously.
2. APPOINT ONE COUNCILMEMBER TO SERVE ON THE PILLARS OF THE
COMMUNITY, DISTINGUISHED ARTISTS, AND DISTINGUISHED ATHLETES
AWARD PROGRAMS REVIEW SUBCOMMITTEE
Community Resources Analyst Michael Calderon presented the staff report, which is on
file in the Clerk's Office.
MOTION — A motion was made and seconded by Councilmembers Pena/McGarrey to
appoint Councilmember Fitzpatrick to serve on the Pillars of the Community,
Distinguished Artists, and Distinguished Athletes award programs review subcommittee
as recommended. Motion passed unanimously.
MAYOR EVANS CALLED FOR A BRIEF RECESS AT 5:09 P.M.
MAYOR EVANS RECONVENED THE COUNCIL MEETING AT 5:15 P.M. WITH
ALL MEMBERS PRESENT
STUDY SESSION
1. DISCUSS IMPERIAL IRRIGATION DISTRICT (IID) CONTRACT EXPIRATION
AND CONSIDER OPTIONS IN MOVING FORWARD THAT ADDRESS AGING
EQUIPMENT AND STRESSED POWER GRID
City Manager McMillen presented the staff report, which is on file in the Clerk's Office.
Council discussed the current focus and governance of IID; IID being a special district
versus a stockholder corporation like Southern California Edison Co.; Riverside County's
non -representation on the IID Board; importance of representation on the IID Board if IID
continues to provide service to La Quinta residents; inability for La Quinta to grow unless
CITY COUNCIL MINUTES
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infrastructure is upgraded and aging equipment replaced; allowance of self -generation by
developers via wind, solar, gas, etc.; future existence of IID; both increased capacity for
new in -fill projects and replacement of existing deteriorating infrastructure need significant
funds and currently there is no source of those funds; need for media to cover this
important matter, i.e., what entity will provide electricity in 2033, how will upgrades be
funded, what will rates look like, will customers be represented, etc.; statewide move to
electric -powered vehicles stressing the grid; challenge of resolving matter when there are
multiple cities, jurisdictions, and agencies involved; unclear as to what entity owns the
infrastructure; the 1934 Compromise Agreement terms, including the imprecise language
on infrastructure ownership; City's ability to establish its own utility district; working with
other City Attorneys to scrutinize and dissect the 1934 Compromise Agreement,
subsequent agreements, and Agreement performance/non-performance; owner of
infrastructure would be responsible for repairs and upgrades, and would be the entity to
issue bonds to fund upgrades; City's options for buying/leasing land for a solar farm;
possibility of Coachella Valley Water District (CVWD) providing electricity in the future;
possibility of eastern Coachella Valley customers creating their own special district; Local
Agency Formation Commission (LAFCO) energy study underway will provide governance
options only, no recommendations; IID's Energy Consumers Advisory Committee (ECAC)
and the newly formed IID Coachella Valley Energy Commission (CVEC) have no vote,
authority, or power, only provide recommendations to the IID Board; past efforts of State
Assemblyman Chad Mayes to get representation on the IID Board for all its customers;
possibility of allowing off -grid, self-sustaining projects; conflict between mandated State
affordable housing project and insufficient power to supply them; lead time for delivery of
new generators, transformers and utility poles; important to provide incentives for rooftop
solar installation in IID territory; the pending failure of IID transformers, wood poles, etc.;
the need for IID to stockpile replacement equipment for emergencies, such as a major
earthquake; need to explore the effect the proposed Chuckwalla National Monument,
which contains IID transmission lines, would have on future energy service; getting
County Supervisor Perez personally involved; providing guidelines to LAFCO regarding
La Quinta's position; State's Public Utilities Commission does not have jurisdiction over
IID because it is a special district, not a public utility company; LAFCO is the agency that
has jurisdiction; need to engage regional partners; and importance of City Managers
working daily behind -the -scenes to study problem and examine solutions.
PUBLIC SPEAKER: Philip Bettencourt, La Quinta, At -Large Commissioner on the IID
CVEC — said it's important for each stakeholder city to develop its own economic and
intellectual library of tools needed to protect constituents, and be an effective dealmaker
when the time comes.
Council directed City Manager McMillen to continue to work with the other City Managers
within the affected regions, and for the City Attorney to work with other City Attorneys
representing the affected regions to determine options and solutions available to Council.
PUBLIC HEARINGS — None
CITY COUNCIL MINUTES
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STUDY SESSION ITEM NO. 1
City of La Quinta
CITY COUNCIL MEETING: February 7, 2023
STAFF REPORT
AGENDA TITLF: DISCUSS IMPERIAL IRRIGATION DISTRICT CONTRACT
EXPIRATION AND CONSIDER OPTIONS IN MOVING FORWARD THAT ADDRESS
AGING EQUIPMENT AND STRESSED POWER GRID
RECOMMENDATION
Discuss the objectives of a Riverside Local Agency Formation Commission (Riverside
LAFCO) study exploring "Alternative Governance Structures and Alternative Electricity
Service Provisions" (Study). The primary objectives of the Study are to evaluate the
current conditions of electricity service provisions by the Imperial Irrigation District (IID)
and address two tasks in response to Assembly Bill 1021 (Mayes):
• Task No. 1: Options for providing continued publicly and/or independent system
operator owned and managed electrical service.
• Task No. 2: Options for alternative governance structures that would extend
voting rights to registered voters who reside within the IID electrical service area
to provide for proportional representation on a governing board that will have
primary jurisdiction on all electrical service matters.
BACKGROUND/ANALYSIS
A 99-year lease agreement between the IID and the Coachella Valley Water District
(CVWD), which provides the basis for which Eastern Coachella Valley residents and
businesses receive electricity, is set to expire in January 2033.
The California Water Resources Control Board has requested that the Riverside LAFCO
in conjunction with the Imperial LAFCO conduct a Study that would provide options for
the future governance of IID to include proportional representation of Riverside County
electricity customers being served by IID. The Study is also to provide options for future
electrical service by alternative public agencies if IID prefers to terminate the service to
Riverside and/or Imperial counties.
The LAFCO consultant reviewing the current conditions of energy service provisions by
IID has requested that stakeholders state what they see as an ideal governance for
providing reliable energy service beyond 2033.
Stakeholders include the cities of La Quinta, Indio, Coachella, and portions of the Cities
of Palm Desert, Rancho Mirage, and Indian Wells, and areas of unincorporated Riverside
County. Today, the Coachella Valley represents more than 60% of IID's energy
ratepaying customers.
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Below are some options to explore:
1. Enter into a new contract with IID — The current IID board is made up of Imperial
County representatives whose focus is the delivery of water. It does not include
representatives of the Eastern Coachella Valley which has no stake in the water
service, only energy. A new agreement may include breaking into two IID boards
— one for water district and one board for energy services which must include
Eastern Coachella Valley stakeholders with voting privileges.
2. Find another entity to provide service — The Eastern Coachella Valley region
can invite another entity that would assume the responsibility of being the power
provider. This would require looking into what it would take for another entity to
acquire existing infrastructure and gain access to the grid.
3. Form a municipal utility authority — The City can operate a municipal electric
utility, either on its own or as part of a Joint Powers Agreement (JPA) that includes
other public agencies. To do this, the City would need to know the value and cost
of the infrastructure that would have to be transferred from IID. And, who owns the
infrastructure now, and who would own it when the lease expires — IID, CVWD, or
the ratepayers?
Addressing equipment needs and upgrades
In choosing a path for the future, the stakeholders must also consider that IID equipment
was not designed and planned to handle the growth that has occurred in the Coachella
Valley. Intensified electrification by our current customer base is pushing transmission
and substation capacity to the limits.
Equipment problems are also impacting new development that can't be served by the
current substations and grid. IID's current policy is to not pay for growth, but for growth
and development to pay for itself.
An estimated $800 million is currently needed to increase generation transmission and
build the required substations for near -term growth in the region. So, consideration must
also be given to funding the necessary upgrades, which may include the sale of bonds
and a rate increase to customers, with programs in place to help those on fixed and low
incomes that might not be able to afford higher prices.
Prepared by:
Approved by:
Sherry Barkas, Management Specialist
Jon McMillen, City Manager
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