 So, good morning and welcome to this very important conversation about water in San Antonio. This conversation is going to be taking place anywhere, practically in America. But, certainly in Texas where drought seems to be just hanging on, it is important to our community to talk about it. And it's important for this, any city in America to be talking about it because they all need abundant and fresh supply of waters. In fact, there are some cities that they predict will probably lose population as they lose water. So, that's why the UTSA College of Public Policy has embedded you today to learn more about the proposed Vista Ridge Pipeline Project and its impact on San Antonio. I'd like to thank the San Antonio Water System for their participation in this program in addition to hosting a series of public events about water, saws, UTSA. I've got a partnership that goes way back and I see some of our good friends here in terms of Mr. Puente and Berto Guerra and Reed Williams, whom we have known for many years. It's great to be in the same room with you all. You have been supporting us for quite a while. Many of you know UTSA students are very talented and they get hired by saws. You're an active supporter in our pre-freshman engineering program, which PREP, which we are proud of that. You continue to advise us on establishing our water institute at Texas that we have on our campus. We wouldn't be able to turn on the fountain without your assistance in helping us use condensed water and not fresh water. We got a prize from you all, the top prize in water conservation. We're proud to receive that. We got it because we are able to move in areas that are saving us water. For example, we now have AstroTurf, an artificial turf on our recreational playing fields. This is a savings of 14.5 million gallons of water per year. You can imagine if 10 acres is using 14 million acres of water a year. You can sense as to why this is a great savings. By the way, it costs us 7 million bucks to put those AstroTurfs in, but it'll pay off in the long run. We've also had, in terms of our new dorms, we have about 2,000 new dorms. The last batch of new dorms have the high efficiency toilets and shower heads to aid in the campus water savings. We continue to recycle condensed water from applied engineering building. Lots of things going on is zero-escaping and converting our irrigation system to high efficiency. We have exciting things happening every day in terms of water conservation. Thank you, Charles, for recognizing these initiatives and proud to say that we're doing our part. It's not a surprise to me that Reed Williams and I were talking about how we got our engineering folks engaged in this. He said it's going to take more than engineers. It's going to take the economists. It's going to take the public policy people. He's right. This is too complex, too big, too burdensome an issue to be resolved by any one group. We, in fact, have our public policy folks in talking about the proposed Vista Ridge Pipeline. As I mentioned, it's a series of communities that we get a sense that this conversation is extremely important to this community and others. Let me thank the UTSA and our staff who made this event possible. Aaron Giants and from the UTSA College of Public Policy. And Mario Aguilar and Selena Alvarez from SAWS, among the many people who really deserve some credit. And again, it's going to be a great conversation. Thank you all for being here. Now it is my pleasure to introduce us to the next speaker, which is our mayor, Ivy Taylor. And I am very pleased that Ivy is a member of our faculty in the College of Public Policy. She teaches in the Department of Public Administration and has been an excellent instructor for our students and the vision that she provides and the insights regarding public service. The mayor has been in her job, and I can say a very short period of time, but is already doing a lot of work and thinking ahead and trying to move our city forward in the next several months. So with that, please help me welcome Mayor Ivy Taylor. Good morning, everyone. Good morning. Thank you so much, Dr. Sines. And I also offer a warm welcome to everyone that's gathered here today for what I know will be a great public discussion about San Antonio's water future. Thank you to my friends and family at the UTSA College of Public Policy for taking a lead role in ensuring that our community has the information it needs in order to make informed decisions about the direction that we'll take on the Vista Ridge Pipeline Project. As you know, I have focused on a comprehensive planning path and my new role as mayor of San Antonio that will include a bottom-up approach driven by our citizens. So it's appropriate that the public is gaining insight today on San Antonio water systems plans for sustainable and affordable water supplies for our future. SAW's planning process has been open and transparent, including public negotiations on a contract for Vista Ridge and events like this one here in partnership with the UTSA College of Public Policy. I know that SAWs will continue vigorous public outreach efforts, which will be needed. The SAWs Water Management Plan includes investments in desalination, the Regional Cariso Aquifer Project, and the Aquifer Storage and Recovery Facility. We're currently weathering a serious drought, but due to our investment in a diverse and renewable supplies, which are critical to the quality of life and economic development, we're able to weather the storm. At a time when we're facing historic cuts to our supply from the Edwards Aquifer, it's even more critical that we closely examine diverse water supply options, not only for the benefit of our city, but for the benefit of our region. The more diversified we can become, the better off the Edwards Aquifer will be, and the better off our region will be. That's already been demonstrated with the non-Edward supplies that we utilize in San Antonio to meet local demand. And I would also just pause to thank those of you in the room that have been actively engaged and involved on this issue over many years. We appreciate your engagement and your continued involvement in this key issue for our city. So I know that you're eager to better understand the Visteridge Pipeline proposal and what it could mean for San Antonio's future and the health of our region, so we look forward to a vigorous discussion from the STEAM panel today. Thank you again for your participation and for supporting the UTSA College of Public Policy Scholarship Fund and SAWS Payment Assistance Program. Thank you. Thank you again for attending this excellent and important event. I'm just going to say a few words about the College of Public Policy that we're co-sponsoring this event. The College of Public Policy is located here in our UTSA beautiful downtown campus. There are a few things of pride that I point out about our college, and good thing that Greg gave me 45 minutes to brag about my college. But it is the college that is the most racially and ethnically diverse across the colleges at UTSA very much in line with the mission of an Hispanic serving institution. Our graduates have also played a very important role as its community leaders. A couple of years ago four of our graduates were among the top 40, under 40, the movers and shakers of this community that are making a difference. And we're also the third largest, we have the third largest number of graduate students at UTSA behind the College of Education and Human Development as well as business. One of my goals as dean has been to make UTSA and the college the primary hub in our city for the discussion of important and critical public policy issues and related social, economic, demographic and political issues. Through a variety of programs such as lectures, for example, town hall forums, panels, as well as workshops, the College of Public Policy has brought together broad segments of our community to engage in key issues affecting our community. In such a manner the College of Public Policy over the last year has collaborated on a few forums related to the important issue of water. So that we're very happy to continue this line of collaboration through the partnership with SAWS to bring together various sectors of the community to engage in discussions regarding SAWS new proposed water project. In addition to this luncheon, there will be two other public forums, one in late September I believe and the other one in the spring that will continue this discussion and community engagement. I want to recognize a few people at UTSA then that have helped organizing this event. Erin Jines, our development assistant is over here. Francine Romero who is an associate dean in the College of Public Policy is up here in front. We have a couple of our students in public policy that were personing the table out there as you came in, Eyle Mubanga who is a master's student in public administration and he also works in Congressman Joaquin Castro's office. We also have Gary Wade who is a BPA graduate and is now in our MPA program and we also like to recognize our student body president or student government association, Zach Dunn over here who was also in Washington this summer working in the Congressman's office also, Congressman Joaquin Castro. And let's see, we're also very grateful to SAWS in that half of the proceeds of the $23,000 will go to scholarships to support students in the College of Public Policy. So we're very happy about that. I would also like to thank the people who have cooked for us, who are serving us and will be cleaning up after us if we could give them a hand for the work that they're doing. And last but not least, I'd like to recognize elected and other officials in audience today. So Mayor Ivy Taylor is here today. Councilman Ron Nirenberg is right here. Representative Doug Miller, Chairman Carlos Rubenstein. Robert Cuente, President and CEO of SAWS. Berto Guerra, Chairman of SAWS. Also, SAWS Board Member. Reed Williams, another SAWS Board Member. Ernest Arayano, SAWS Board Commissioner Kevin Wolf. Louise Rowe, also a member of the SAWS Board. Luana Buckner, EAA Board Chair. Ben Young-Rulad, EAA Board. Gabriel Duran Hollis, Mayor of Hill Country Village. And Representative Mike Villarreal. So now we will take a few minutes to begin eating or continue eating and then we'll introduce the panelists. Thank you. All right, we're back. Just very brief introductions of each of our panelists. So first of all, serving as the panel discussion here, the moderator is Evan Smith, who is the Editor-in-Chief and CEO of the Texas Tribune. Okay. Then our panelists, we have Carlos Rubenstein, who is the Chair of the Texas Water Development Board. We have Robert Cuente, who is President and CEO of SAWS. And we have Michael Belden, who is the Local Business Leader for Belden Roofing. And he's the Chairman of the Belden Roofing. Thank you, sir. Dr. Seins, thank you very much. Good afternoon, everybody. Nice to be here. Always wonderful to be in San Antonio. I would prefer to always be in San Antonio, in fact, but come as often as possible. Thank you for being here, panelists. Dr. Romo, always wonderful to be with you. Thank you. We're going to just launch right in. I have the honor of being on stage with one current Chairman and two former Chairman. So I'm just going to address everybody as Chairman to make it simple. And Chairman Rubenstein, I thought I would begin with you, and I thought I would begin at a satellite view of the water crisis that we face in this state, precipitates actions like the one that SAWS and the city of San Antonio are considering taking in this instance. We hear all the time hyperbole about the magnitude of problems, not just on water, but on every public policy issue. And we hear specifically on the problem of water that we've just come out of or recently come out of the worst one-year drought in the history of the state. Back some of us who are old enough to remember, or at least who have read about the time it never rained, this is worse. Is it as bad as all that? And is it continuing to be as bad as all that to the extent that this kind of significant action needs to be taken? Well, the short answer is absolutely. We need to be taking the steps that are being contemplated here in other parts of Texas to diversify our water supplies. You're correct. We no longer have a 2011. It's kind of tough to be 2011 when you have all 254 counties in significant or exceptional drought conditions. So it's tough to beat that. But what we're not out of is this drought. The drought is not over. We do not yet know if this drought will end up being the new drought of record. You go to Wichita Falls, they will tell you that they think that they already surpassed and they're already in a drought worse. It doesn't feel any better to them. It does not. And then we look at, so it's going to rain again, it will have another drought. And so where are we going to be in Texas in the following decades? Where are we going to be in 2060? You know, we plan on a 50-year horizon. If we fail to undertake the appropriate implementation if we fail to diversify where our water comes from. The impact to Texas in 2060 is about $115 billion a year. The impact to Texas jobs is about 1.1 million jobs lost. The impact to Texas population is 1.4 million folks leaving. And so, yes, we need to be doing these things. And having passed Proposition 6 last November, there are some people who don't pay attention at the detail level who think, okay, problem solved conversation over when, in fact, it really is conversation just beginning. Absolutely. We're just getting started. And thank God, the folks that showed up at the polls last November Prop 6 passed by 73%. But the hard work begins now. I was having a great conversation with Representative Miller about all of the variables and all of the timelines they put in House Bill 4 that we're about implementing this year. And God willing, we will have all of them completed by December. We're going to be implementing applications, and that's when we start moving these projects forward. Right. Now, on the same line of questioning, you are Mr. Chairman, former in two instances. You're the former chairman of the Edwards Aquifer Authority, former chairman of the San Antonio Chamber, so Mr. Chairman Chairman. I want to ask you about two aspects of what Chairman Rubinstein said. First of all, the economic development aspect or the prospects that our economic health as a state and as a region will be impacted if we fail to act and ask you about the difficulty that we face right now with regard to the Edwards Aquifer specifically, which in its own way has precipitated this discussion. So talk with your former Chamber or Commerce Chairman had about the economic development predicament that we find ourselves in. Nobody's going to come to San Antonio to bring a new business or build business if we don't have an adequate water supply. I remember back when I was chair of the EAA and the USAA Bob Davis threatened to move out of San Antonio because he was concerned about our future water supply. Right. From the Chamber perspective we've watched SAWS have water plans that have changed year to year to year to year to year. The great plans for the future did not eventuate. Right. My good friend and former president of the Chamber, Joe Pryor used to say SAWS will have a water plan when they put forth a plan that Tom Frost and I think that is where we are today. I think we finally have a plan that makes sense that can help San Antonio in future economic development that's crucial to everybody in the city for all across the economic spectrum. If we don't have adequate water it's a bad place for all of us. If we do have a great water supply it's a wonderful place for all of us. It's a win-win. Chairman Puente, I want to come back to on the Aquifer question in a second. What do you understand from your years of service in public office and in the SAWS capacity and just what you've observed? We find ourselves in a very interesting situation with regard to population change. Both have alluded to that. We're adding something like a thousand or more people a day to the state's population and as far as I know none of those people is bringing water with him. We're at risk of being victims of our own success in terms of population growth and straining what after all that resource in the course of water. That's at least part of what's at work with attempting to solve this problem and that's not just the San Antonio problem. What we have to address is the continued growth that we have. We want to participate in those solutions I think in our 2012 water management plan we have identified how to meet our needs in this region and we look forward to reaching an agreement potential agreement with Mr. Ridge to see if we can satisfy those needs that we have out into the future. What's in San Antonio is outpacing the growth in a lot of other cities and the growth in this region similarly is outpacing the growth in a lot of other regions in the state so it's a particular problem here. And we at SAWS have a duty to address that need to address that growth to make sure that we are not the hindrance of the economic well-being that Mr. Beldin talks about. Chairman, the fact is that and this now on your Edwards Aquifer authority former chairman had, was no longer the available source for this region that it was once in part because drought conditions and other things have impacted the ability of the Aquifer to be as plentiful as we'd like it to be. Well, I think what we all came to realization in the 93 and 95 time frame that this was a resource that we were going to share. We needed to share. Because we need to share that there are limitations on what we can fund and I will tell you that although I've had disagreements with SAWS over the years about long-term water supply I think everybody needs to appreciate what a great job SAWS has done in the ASR project and the Crizo project and having adequate additional water right now at this point in time as the EAA is moving into Stage 3 and Stage 4 that SAWS customers are still in Stage 2. And that's because of the great work that Robert and his staff have done. And so I think this is just the next step is to put in place a really large long-term water supply but they've done a great job in keeping us in a position today that is more favorable than most cities. Chairman Puente, can you be specific about the reliance of SAWS in this region historically on the Edwards versus where we are now and versus where we're projected to be? Up until a few years ago, 15 years ago we were 100% reliant on water. So when the legislation changed in the early 1990s to where there was cutbacks, there was a certain amount of water that different stakeholders were able to withdraw from the Edwards we were now limited. We now knew that we were not only limited when that legislation passed there was another cutback 15 years later which would be 2008 where another series of cutbacks had to take place. So during that 15-year period there was a mode of addressing the future. That's when we commissioned and built the ASR. That's when we commissioned and built the largest recycle system in the nation and that's when we started looking at other water sources such as the Trinity the Carisa Aquifer. And so we've done that in the early part now we're getting ready again for the future. Our plans have shown that there's supply gaps in the near future as early as what is meant to meet that need to make sure we have an abundant supply of water for our community. So you've heard, we've just heard the case for action of some sort. Let's get to the specific thing that is before or as soon to be before we think the city of San Antonio. Saunas has previously in fact recently considered in recent history considered pipeline projects of this sort. Seemed at one moment to have pivoted away and then pivoted back to this. What about how we got here? Our 2012 management plan identified gaps as early as 2019 and that's the worst case scenario, drought of record all those planning numbers in addition to the other supplies that we were looking at we identified a gap. And to meet that gap we needed about 50,000 acre feet and we put out a proposal. So that number has been the number all along. I know there's been some question as to where that number came from or whether that number is too much or whether that number is tied to this specific plan. Your contention is that number has been the number all along. That's the identified need. That's the identified need. We put our proposal with that need to be addressed. We had nine respondents. We narrowed it down to three, narrowed it down to eventually to one. Our board selected for allowed us to start negotiating with the Vista Ridge Consortium which is made up of Abangoa and Blue Water and so they allowed us to start negotiating with them so that 50,000 acre feet was identified. This will meet that need but that's not exclusive to this project. To meet the need that we have, the gaps that we have, we have to have additional water projects that we don't talk much about. One for example is an aquifer right here in Bear County, the Cariso Aquifer. Our desalination plant which was groundbreaking just occurred a month ago. It will be online in 2016. Water conservation was identified in the 2012 plan that would create at least 16,000 acre feet. So those plan that plan was in place so we have to have continued water conservation to meet our need and we have to have even these other water projects to meet that need not just this particular Vista Ridge project. Come back to the history of how we got here in a second but Chairman Rubenstein, this kind of any and all approach conservation where necessary, figuring out deals that could be made, desal the application of technology to solve these kinds of problems. That's really in essence what the program that you're administering at the Water Development Board through the SWIFT and Prop 6, that's really what that's about. Couldn't have said it any better. I do want to highlight one other thing that I think San Antonio has done exceptionally well. Let's start with the first one, conservation. When you talk about conservation when San Antonio has done since 1979-1980 I believe the numbers reflect that you've cut the per capita consumption by 100 gallons per day per person. That is remarkable and San Antonio should be applauded for that. I think you went from some around 225 gallons per day per person to I think you're in the 120 range now. That helps but that only addresses part of the need. The other part of the need is the raising the awareness of how we're using our water. If you're going to conserve water to keep using it the same way you always have you really haven't helped yourself long term. I think San Antonio does a great job in being able to raise the awareness of the value of our water. But when we look at our state water plan and we look holistically at the entire state trying to come up with 8.3 million acre feet of water, we look at all aspects of it. So yes, part of it can come from conservation and it is here. Part of it can come from reuse and it is here in San Antonio. Part of it can come from moving water from where it is to where it is and the water we already have today available today moving it from where it is and I guess that's part of what we're all here talking about today. Part of it is also developing new sources of water and that's when you talk about ASR, you talk about brackish, you talk about seawater and if you hear the discussion that's going on today, San Antonio is hitting on all of those and I think that is very appropriate. Chairman Puente, do I understand the history of this to be that at one point you all were so high on DSAL that you were considering not doing a pipeline project at all. Is that right? Correct. At one point we looked at expanding our current DSAL program. Our current program has three stages in five-year increments to a total of 33,000 acre-feet. That's still on the board, that's still what we're going to do, that's still on our plan, that's still what our board has appropriated money for and that's still what our city council has given us. But it's only a component. It's only a component. Right. The conspiracy theorists and there are some on this issue as there are on almost every issue in Texas believe that the chamber was instrumental, the business community in causing SAWS to pivot away from a DSAL heavy plan to one that involved a big pipeline project like the one we're here to talk about today. Did you get taken to the woodshed as one person described it to me by the business community? Just because you told me ahead of time that you were going to ask me tough questions doesn't mean you were going to ask me tough questions. I realize I'm a guest in your house but I know where the door is, so it's okay. Did the business community have some impact on the way this went? Sure, the business community along with the environmental community, others are stakeholders in this endeavor, they have a right to say what they want to say. But we always gave our board the options. If you look at that particular board meeting, our mayor said he wanted an abundant supply, an adequate supply. When we presented this to the board, we did recommend that they go the DSAL route, the expanded DSAL route. But that opening was there for the board to evaluate. It wasn't an issue where that particular day they needed to vote. We purposely address the board, give them information, and in subsequent board meetings is when they actually vote. During that time period, they sought further information, they received further information, and our board gave us the direction to go this other route and talk about this particular project. And the reason for that was up until this point, we were constrained by the legalities of a request for competitors to seal proposal. We needed the opportunity to sit down with Avingoa and Bluewater to clarify what their proposal was. Once we were allowed to clarify that proposal, we found out that we had a lot more in common on a potential contract. When we clarified certain issues and we informed our board collectively said this is the project that we want you to start negotiating on, and that's where we are today. Mr. Belden, Mr. Chairman, again, former Chamber of Commerce Chairman, you believe the business community is with SAWS in thinking that this would be good for San Antonio, not just in terms of water, but in terms of the economic development aspect of this that would cause the business community generally speaking to before this and may even have pushed SAWS in the direction of getting this done. Absolutely, but I think it would be unfair to say we push SAWS or we in the business community that wobbly on these sorts of issues, that we push SAWS to do the Avingoa deal. What we pushed was don't preclude it, look at it, be willing to talk about it, see if there's a deal there. You all have to decide whether the numbers work, you have to decide if there is a deal to be made. But we were very concerned that they would completely cut off and not look at the deal, and I think that's where the business community is coming from. So explain, Chairman Puente, explain the contours of this project. So what is the overall cost of the project, what is the time frame in which the project would be executed, kind of give us the nuts and bolts of it? It's a 50,000 acre-feet project that's a lot of water that would be roughly about a fourth of the supply that we have now. It would really truly diversify us and we will have a good diversity portfolio of water. And it's as much as, again, going back to the original question of where that number came from, it is what you need. It is not more than you need. Correct. So you're not going to have so much when this project is done that you're going to have to sell some of it off. The key to that is at the beginning and in wet years, it is more than what we need. Right. In the beginning. In the beginning. And even today, when we have a series of wet years, we don't have more than what we need. Right. And we never want, obviously, to have less than what we need. So ideally, the first part of this project, we will look at partners up and down the that corridor from here to Burleson County. It's a very high growth corridor, Highway 130, and look at all those communities. And we're currently talking to a lot of those communities about potential partnerships where they would buy part of this water for their own needs. And so this will help drive down the cost. This will help any rate increase that we may need from City Council that our rate payers would have to pay for. It will help in that endeavor. So it's hard to say exactly what it will cost. But we knew that we do know that it's an expensive project. Yeah. Ballpark. And I know hard to say is truthful and sincere, but just for fun, ballpark it. Ballpark it's about a three billion dollar project. Right. Can you also ballpark what the potential rate increase for rate payers is going to be? Remember, this is a very big ballpark, major league ballpark. I've been to big major league ballparks. They're not infinite sized. So I know it may be big, but ballpark it nonetheless. And they have very low fences to where you can actually hit a home run. So it's roughly we're talking about 16% rating. 16%. Yes. Our goal is to drive that number down through a lot of mechanisms. One is the partnerships that we talked about. Right. Another one is negotiations that are currently undergoing where there's an issue of the ONM cost. Power is very important. Water is very heavy. We have probably four different electrical providers along this route. One of them being CPS energy. We want to negotiate with CPS to give us very favorable rates, but also have these other entities use CPS as the power provider. Right. And trade power with them to where their rates that they charge us are actually CPS rates. And you'll have to deal with the proceeds of sale of water in those early years or any of the other deals that you cut with the partners you're referring to. That will be passed on down the line to rate payers. Exactly. So that the 16% is kind of an outbound prediction of what the rating may be, but ideally you'd like it to be less. Sure. And the power cost, whatever dollar we pay, we know 14% goes back to our city. Mr. Chairman, if I understand again, it's complicated as it is in any city, but as I understand it, the council has to approve a rate increase, correct? They own SAWS, the city of San Antonio owns SAWS, our rate payers own SAWS, so yes. What guarantee do you have if this deal is done that the city council, as the ones who have to approve rate increases would approve rate increases? I think the council, as they have done previously, in particular the six years that I've been there, as long as SAWS does the ground they do the outreach, they go into the communities, they talk to their constituents, they tell them the reasons why we need this rate increase like we did a few years ago for our consent decree with EPA regarding our sewer system, that they'll see the support that their own constituents, our own rate payers will support it and then they feel comfortable supporting. You're not concerned about the uncertainty of a council at some point in the future, that maybe a council with different people on it are talking about today. You don't see the uncertainty of the council having to approve a rate increase as a potential hurdle to get over. As a former political person, I understand the difficulties of it, but I understand that that's the reason we run for office, is to make hard decisions if it was easy, a lot of more people would be doing it. So we will give the council the information that they need to feel very confident that what the decisions that they make are the good for this community. I want to ask Chairman Puente and Chairman Belden as well, who's making money on this deal? Somebody has to be making money on the construction of this pipeline. Who's making money on this deal? Well, anybody associated with Admin Go and Blue Water making money, there's nothing wrong with making money. Our free enterprise system, capitalism are what makes this world go. What makes the United States go, what makes San Antonio go. So different engineering firms it is their business to acquire work and get work, and they happen to employ a lot of San Antonians, so they'll make money. Construction companies, steel manufacturers, people that service the pipeline, they will all make money. They will be investors that make money. There's nothing wrong and we recognize that at SAW that there's nothing wrong with, because we are reaching an agreement with a private entity. Private entities need to make money, they should make money. We recognize that. They deserve a rate of return that will be attractive to their investors because we are buying a product and there's nothing wrong with buying a product. Surely you agree with that, right? Robert said he used to be a politics. I got news for you. Still in politics? It's like riding a bike. You never lose it. So in addition there's 3400 I believe water rights holders that are also going to make money off this. But there's nothing wrong with making money. I think you need to put this in perspective and let's look historically. If we had bought water in the 70s or 80s it would have ranged from 30 to 40 dollars an acre foot. Today we're talking north of 2,000 dollars an acre foot. Do we want to be 20 years from today have people look back when water now is 5,000 dollars an acre? Pick a number. The only thing we know for sure is it's going to be more. We want to have people come back and say what were those guys thinking when they had an opportunity to buy 50,000 acre feet of water and they didn't do it? So in terms of the economics of this the question that I've been asked and that I feel duty bound to ask you is everybody who stands to make a buck off of this thing public I've been a critic of this project said to me well why won't SAWS release the list or why won't the people behind this release the list of investors in the project. I know you all have talked about this project. Have you released or would you release the list of investors? They have released a list of their investors and they went even beyond what is required under our city ordinance to release those investors. So you're satisfied that there's been adequate transparency. Chairman Rubenstein let me ask you about groundwater law. Obviously a lot of the success of this project hinges on the ability of sort of the need to intersect properly with what the law is and available resource and everything else. Back in February Chairman Puente was quoted in the Texas Tribune. You may have heard of it. Once or twice. As saying the following groundwater law in Texas leaves too much uncertainty and risk for the private and public sectors. Was he right then that groundwater law at present is risky and so risky that taking on a project such as this made itself be too risky? You know groundwater law in Texas is what it is and I think when you find a way to work within the constraints of you could say the same for surface water as well. Yeah sure. So you can make that argument for wherever you want to go. I think in this instance when I look at the information that's been made public when you appropriately work with a groundwater conservation district because it appears that that has occurred. When you appear to be able to satisfy the water right holders the area, the folks that own that land in that area. Then I think you find a way to move things forward. I think there's innovation to be had. There is a reason why in Texas groundwater law is what it is. The preferred method in Texas of dealing with groundwater is at the local level. And we do so by establishing groundwater conservation districts. We don't have them everywhere in Texas but we have just around 100 of them around it. So if you work with a science that exists the desired future condition what is it that aquifer is going to look like? How much water do you have available to permit so that you're also protecting future interests as well. I think you can get to a point where you can collaborate to also work through these obstacles that are there. But you could say the same for surface water. If you want to go and attract surface water how much water is available? What reliability do you have? And then you can quantify all of those as challenges but it's just part of what we have to deal with. Chairman Puente, what changed between February and now that back then you were expressing concern publicly about the risk that groundwater law would pose for a project of this sort but not today? What changed were those clarification talks we had with Avangoa and Bluewater Rister Ridge. And essentially you talked about a profit. Who's making a profit? One of the reasons why they should make a profit is because what we've agreed to is to take that risk. So the risk is actually with them? The risk of groundwater changes, state law changes, they will have to be burdened with that risk. And because they are part of the reason they are able to is to take on that risk is that they will be able to get a rate of return that is sufficient to meet that risk. And there's no chain, I know Representative Miller is here, Representative Rial apparently or not in the legislature, but Representative Miller at least will be here. Is there anything that he and his colleagues up the road should be thinking about that you'd like them to be thinking about in terms of changes to groundwater law as they would affect this project or other projects? The quote you said I still stand by, we were able to negotiate that away in this particular project but that is true for every other project that we undergo and the rest of the state undergoes. We still have very difficult groundwater district rules and state law that does not help projects. So you'd like some sort of changes but not only for this project, generally? Yes, for example our brackish desalant plant that we are currently building, we're spending money on could benefit from regulatory changes, state law changes. Our expansion could benefit from it and other parts of the state are looking at brackish and they should benefit also from those changes. Okay, let me move on to Chairman Rubinstein and ask about the nature of groundwater supplies and the particular situation we have with geography. So this project, Chairman Puente, I understand is a Burleson County, this is a Burleson County view. As I understand it, the adjacent counties are Lee and Bastrop counties and there is a big fight going on right now over access to groundwater. I believe there are two active bits of litigation over groundwater in Lee and Bastrop counties. 45,000 acre feet at issue. What is to say that the resolution of the way this works is basically that water knows no county lines, right? You have one county, you have another county, but the fact is which water, where does it go, kind of how does this all work? If the Lee and Bastrop county lost it, this is the lost pines groundwater conservation. If that is resolved in a way in which water is withdrawn, is that going to in any way impact the available resources at Burleson County in the post-oaks of underground water conservation, proximity being what it is? In a simplistic way I think, you know, the way we do water planning, the way we do water availability in Texas accommodates for those potential changes. We need to revisit desired future conditions consistent with when we're revisiting the state water plan. All of those things firm up how much water we have available. There's a couple of things we already know, for example, by 2012 in Texas, just because of the way by 2060 in Texas from the 2012 plan. We know there's going to be 10% less water. That's already built into the planning that is occurring statewide. When you have a process where you revisit desired future conditions, when you have a process where you revisit and true up manage the available water that's available for permitting, I think you're able to catch up in this endemic process that we follow. The thinking behind this project takes into account the possibility that a nearby repository of groundwater might suddenly see 45,000 acre feet withdrawn. It doesn't necessarily impact the calculation made about the available resources for this project. And the responsibility for determining the availability of that water still rests at the local level with that groundwater conservation district. I read the Express News Chairman Puente within the last couple of days. In fact, I think it was yesterday that there was a story about this project. And I was struck by this statement related to the Post-Otah Savannah Groundwater Conservation District from which you seek 50,000 acre feet of water for this project. It's modeled this is referring to the resource that you're going to be taking from. It's modeled available groundwater is 61,020 acre feet annually. Now, I'm a simple-minded person when it comes to this stuff, so I may be doing the math wrong or I may be reading that in a way that's not sophisticated enough, but taking 50,000 acre feet from a repository that is said by the Express News to have 61,000 or so of modeled available groundwater annually, that sounds like a lot of water coming out of a limited pool of water. Help me understand how that all works. There is that number, but this again, these are conservative numbers. This is a groundwater district that has a very different philosophy than most groundwater districts. They recognize that there's a need for water and that the exportation of that water can be very beneficial to their own economy, their own well-being. So they for example are one of the only groundwater districts that give out permits for even more than five years. They actually have 30 and 35 year permits because you need two different permits a permit to get the water out of the ground and a permit to move it out of the county. They Mr. Rich project already has permits for both and so that philosophy of that groundwater district and those numbers you talked about are very conservative numbers, so we feel very confident that the 50,000 acre feet is a firm number. Part of this negotiation, Abingoa has also Mr. Rich has also agreed that if for example they have more than 50,000 acre feet of land leased. They have enough for a buffer in case that there is some kind of drawdown or there's some kind of regulatory change by the groundwater district. So again, our proposal was 50,000 firm acre feet of water not drought, not subject to drought firm and so their response to this proposal was firm 50,000 acre feet and so those issues were addressed during the proposal. You're confident that this was. And this is the Carrizo Wilcox correct aquifer. So you know something Chairman Belden about aquifers having chaired that Edwards Aquifer Authority. Do those numbers concern you in terms of the water that would be withdrawn and available resources and long-term health of the local communities from which this water would suddenly be transported? The last thing I would claim to be is a technical water guy. Right. But from everything I know I'm confident that they have that Abingoa and Blue Water have enough water that they can meet this need and San Antonio is only going to pay for delivered water. Well so let's come to that specifically. So the phrase that I've heard is take and pay. Which sounds you know kind of great. I like that. So if you take it you pay for it but if you don't get it you don't pay for it. Right. That's how that goes. So that's another case of the vendor in this instance bearing risk. Could you talk about how that works? Oftentimes when a project is built no matter what happens someone has to pay for that project. Yeah. Whether it's a drought condition or anything like that in this particular proposal the contract negotiations that we're undergoing we have agreed that if they don't deliver the water we don't pay for anything. And so that risk is on them. For example if for whatever reason upstream from our meter from our gate they cannot deliver that water. They still have to make their bond payments. They still have to pay for this project. Yeah I am. But we don't have to pay for the water. You're not on the hook for that stuff as it turns out. But the risk we take is if they do deliver the water regardless of our situation we have to pay for that water. So if it's a series of wet years we take that risk. We have to dispose of that water some through our distribution system to our customers. Chairman. But doesn't that also make the exact case for why it's so wise for San Antonio for example to be diversifying and looking into multiple sources to be able to overcome whatever potential shortage may materialize from any one given source. Right. In the event that things don't work out. Exactly. You've got multiple options that you can draw on. And currently those things don't work out. So currently we do have for example some surface water that we had that had water quality issues and we turned that off. Our surface water supply Medina Lake doesn't exist anymore. We had to turn that off. Right. That's down to zero. That's at zero. So that diversity that we have of the Trinity Aquifer the Cariso Aquifer and the management not just the Edwards water but the management of the Edwards water means that we can meet the demands of our customers. Let me ask one more big question that we'll get each of you to talk about and then maybe we'll throw it open for questions from the audience. And well I think we're supposed to have microphones on either side. We'll ask you to line up and we'll take as many questions as time permits today. Chairman Rubinstein Chairman Puente both talked about conservation that is now among other things that is San Antonio's land. Right. We're the community that really got it right or has gotten it right on conservation and has seen a significant savings of our water use. How will this sudden plentiful abundant availability of water impact the city's psyche as it gets to conservation. So it's easy to persuade people to do things in a crisis. It's harder to get people to do things that they think well we got 50,000 acre feet. We can all water our lawns every day 10 times. We have all this water. Everything's great. So the city is going to hear in the course of this project working its way through well we've got all this additional water available to us. Why would anybody at that point feel like we're in enough of a crisis situation that the kind of good stewardship of our resources and conservation that we've done would still be necessary going forward. Again in 2011 when we started developing our 2012 water management plan we had new 2010 census numbers. We had the integration of the bare met system that was very water poor. So we had to so the plan that we developed identified this gap, identified the need for this 50,000 acre feet, but still identified the need to continue the water conservation programs that we have and even to expound on them and make them more aggressive to drive down that per capita use. And so our goal is still to drive down that goal to meet the needs that we have in the future. It's not only a big expensive project like this, it's that day-to-day water conservation that we're very good at we have to continue to drive that down to our customers that we still need them to use water very wisely. And so this concept that we're drawing away from water conservation that we will lose that ethic is just not there. To meet the goals we need to have a 16,000 acre feet of water conserved from the 2012 plan into the future. And that's not going to be a passive messaging of conservation. It's actually going to be an active messaging on the part of this. Talk to me Mr. Belden, chairman on the business community and to this. So I think that San Antonio has that culture. Yeah. And let me contrast that for a moment. I recently heard a speaker from California talk about the nexus of water and energy. And she said something that was absolutely astounding to me. The city of Sacramento until recently had no water meter. Flat rate for water. That is so alien to our culture in San Antonio. I for one think that we have the best leadership we've ever had in the water arena. I have confidence that our city council is as good a council as the city has ever seen. They're not going to get stupid all of a sudden and let us go away from what we've done so well with. You either have confidence in your leadership which I have a great deal of confidence in or you don't. And I believe that they have the foresight and the understanding and the intelligence to continue to do those things that have worked well for us. And so I'm not the least bit worried about the concern. Let the record show that it took 45 minutes for somebody to beat up on California in Texas. In a public policy conversation in Texas may be a new record. Chairman, last word to you on conservation. Well, you hadn't opened up the door on being able to be here. So that's part of the problem. I wasn't doing my job. And Chairman Puente has heard me say this before. He and I gave a presentation three years ago in shirts and there was a slide in his presentation. The point I'm making is history for San Antonio absolutely supports the fact that conservation will remain. There's a slide in Chairman Puente's presentation that showed and I think it was since 1980 the population growth, 62% population growth if I'm remembering correctly, still dealing with the same amount of water. The psyche's already built in. The rate structure that San Antonio has already put in place is built in. The comment that I made to you earlier you don't get San Antonio from going for 225 gallons per capita per day to 125 just because it was dry. In that period of time we had periods of flood periods of plenty. And yet it is a marked record of being able to reduce that consumptive rate which indicates to me that people understand that it isn't to conserve water just so when we have it we're going to continue to use it the same way. It's to conserve water because, one, it's the cheapest water we will have. But we learn the value of it and I think that that clearly is going on here. I think it's sustainable. Okay, well let me ask that anybody in the audience who has questions we have the two microphones and so for the benefit of people in the audience who would like to hear your questions, we'll ask you to stand at the microphones and I'll go one, the other, one, the other until we run out of time. I think we have a few minutes. Sorry you were fastest to your feet. Well first of all I want to thank the panel for superb job and I do realize this is a Vista Ridge topic. But since we have a new leader at our Texas Water Development Board and he's here in San Antonio and our new leader has two billion dollars fall on his head you know I'd really like to hear from you chairman about what are we going to see happen in Texas how are you going to effectively manage this, what are you going to be priorities because you listed a bunch of ways to approach the water, how can you quickly turn over this money because you're not it's not grants it's loans but so we can use it and reuse it but it's a tremendous opportunity and I'd love to hear what your thoughts are. And let's be clear chairman before you start that the swift money that's available as a consequence of Prop 6 actually does not intersect with this project specifically right so it is not the case that you're administering a fund that will in part go to support this project. Well right now I don't believe that that is contemplated but we could support projects like this. There's a lot of things about the project that would play well in future projects or similar projects. If you build a project you have extra capacity in the early years and you end up enhancing regionalization House Bill 4 speaks to that. And we're supposed to give high priority to projects like that. And so those are things that are of interest to me and I hope that we see those going forward to your question and I hope you appreciate that by asking that question you could team me up for another hour discussion so I hope you all have some time. The two billion dollars, the two billion dollars has been transferred the day before. So shortly after Texans by 73% approved to prop 6. The two billion dollars is being managed by the Texas safekeeping trust. It is a function of the state comptroller's office so while the money is dedicated for the water development board I wish I could tell you that I saw it for like a microsecond. I didn't. It's all at the safekeeping trust. The trust is already investing and it's already making money. How are we going to use it? It's very specific. How the money is going to be utilized? Well, we're going to hear from you all. House Bill 4 is very specific about how the projects are to be picked. House Bill 4 did not change the bottom-up approach on prioritizing what a local area wants to do to meet its future demands for water. So we are waiting for the regional planning groups to finalize their final prioritization list by statute that is required by September 1st of this year. I want to tell you that there hasn't been a single deadline that was established in House Bill 4 that hasn't been met. We established, working with the regional planning groups, the uniform set of standard prioritized projects at the regional level and did that early. The regional planning groups were required to submit their draft list by June 1st. They did that. Every single one of them, all 16, without exception. Some of them in reading updates that I get from all of the regional planning groups have already voted on submitting their final prioritized list that is due in September. They're voting on that right now. So I'm very confident that all those lists will be finalized September 1. House Bill 4 also established a tremendous amount of oversight which I welcome. We get to report to an advisory committee made up of three members of the House, three members of the Senate and somebody from the comptroller's office on how we're investing the fund, how we're doing the rules. We've already met with those members. We're also meeting with all of the elected officials that we can on what it is that we're doing. But the other thing that we're doing is and I hope you all have seen it the board has really taken on outreach, just like the transparency that you spoke about earlier to make sure that we get by in an understanding of what people's ideas are on how we should implement the rules. House Bill 4 requires that before we can cut the first check, the Water Development Board has to construct a set of rules and adopt them. They have to be adopted by March of next year. I promise you we have no interest in having that rule open until March of next year. Right now we're on a path to having that rule adopted and final by December of this year, which means that we will be able to, from the list that the regional planning groups have prioritized, accept applications for funding this time next year. How quickly are we going to be able to do it? We have run a tremendous amount, countless amount of stress tests on the model to determine the capacity of how we're going to turn 2 billion to 27 billion over 50 years. Right now we know that when we open up the first round of applications, we will be able to accept applications up to $800 million a year for the first few years. A little over $8 billion in applications in the first decade. Think about that. The 2012 plan says that to implement all the water management strategies that are there is going to cost us $53 billion over 50 years. We're on a path to be able to potentially fund a third of that in the first decade alone. So I think it bodes very, very well. Clearly when applications come to us, hospital fall also requires that we apply a different set of criteria to prioritize those as well. Among the things that we'll be looking forward for is what size of population is this serving? Does it also protect rural Texas? Does it protect it because you can have a small project that per capita or percentage wise supplies a tremendous amount of water for that area? We'll be able to protect rural Texas as well. Is there a percentage in the deal that has to go to rural or ag? There is. There are very specific set of sides in house before. The legislature told us very directly what their vision was. The actual wording in the bill is somewhere along the lines that the water development board will undertake a fund for conservation and reuse. It also says that the water development board has to undertake the utilization of not less than 10% of the fund for rural and agricultural interests. Chairman Poentha knows when you include words in statute that says undertake the utilization of not less than that is a floor and not a ceiling. And so we'll be looking for the regional planning groups to identify those projects, bring them forward and help us identify them. So I hope that is at least responsive to the question that was asked. And on the question, I'll come to your question in one second, I promise ma'am. On the question of buying Chairman Poentha, the city of San Antonio understands that projects that seem like slam dunks when they don't have adequate buy-in from the public tend to go away. How are you going to avoid this falling into the same trap that some others have fallen into? By the outreach that we do. This is an example, but the real examples that we have to give our members is asking council members, who in your district should we meet with? You set up the meeting, we will go to it, we will explain this project to them. We're asking our advisory boards and our board members to participate in that. So retail politics. Yes, it's a matter of that outreach. Ma'am. Is this on? I can repeat your question if it's not. It used to be Medina Lake. The forests outside San Antonio are dying from the current drought. On our property we are currently cutting down 30 to 40 foot trees because they're dead. This proposal is very exciting to hear about and I think it's much better than previous proposals over the past 20 years that I've heard about. So my question is, and you may have partially answered this for me, I didn't hear rain water capture as a factor in the complex equation of water conservation and water use. Will there be any state or regional incentives for commercial and residential builders to include rain water capture and use in construction and remodels? Mr. Belton, we're sort of walking up to your business. What do you think about that? I think there's a great opportunity there. We're in the roofing business. We're also in the gutter business in 14 cities across the country. And we sell a lot of rain barrels. So there's no question that there's a lot that can be done in that arena. Mr. Chairman, Puente, do you see that as a component of this? Yes. When I was in the legislature, I passed a couple of rain harvesting bills. We do recognize that there's limitations as far as a public utility is concerned regarding that, because first of all, it has to rain to capture that water and also it's for outdoor use. We're very protective of the indoor use, the cross-contamination that could potentially happen. But as far as the items that she talked about or the incentives that she talked about, I think those are great ideas and things that we're looking at and hopefully participate in. I see another chairman looming. So it may be that our time has come to an end here. I appreciate the questions. I want to say how much I appreciate the panelists willing this to answer the questions and to engage in a serious conversation. Please give them a hand. Thank you very much. Thank you. Thank you very much and good afternoon, everyone. I want to thank for those of you that don't know me. I'm Berto Guerra, chairman of SAWS. I want to thank Mayor Taylor and Councilman Nirenberg for being here and whatever other council members are here that I have not recognized. But thank you for being here today. Dr. Romo and Dr. Sainz, thank you for helping us with this endeavor. To my good friend representative Mike Villarreal, thank you for being here and caring today. We appreciate you and representative Doug Miller who I just met today. Thank you for being here, representative Miller. To Chairman Carlos Rubenstein and Robert Puente and my friend Mike Beldin and Evan Smith for all the great questions and answers that we went through. And to now cast SA who has live streamed to the public sponsored by CPS these issues. There has never been in my very humble opinion a more important topic that we as citizens can discuss. 36 years ago I was a member of the Hispanic Chamber in Austin, Texas and I admired this city from afar because we in Austin would get together and we would go to Washington, DC to try to save Bergstrom and to try to bring things to our city. We would get to Washington, DC to find African-Americans Latinos Anglo-Americans, Asian-Americans Republicans and Democrats arm in arm from San Antonio visiting our state capitol our nations capitol and our state capitol getting things done for San Antonio. I had never seen anything like that in my life. The one thing that I did not admire San Antonio for was why in the world weren't you diversifying your water supply? That bothered me and I had nothing to do with water other than washing my car and taking a shower and drinking some water but I thought it was important for a city. And so 20 years ago my wife and our four kids moved here and we now have two grandkids that live here and I could no longer complain about why weren't we diversifying our water supply. It was time to put a team together to do just that and I asked former councilman Reed Williams to join me and Robert Puente in that effort we asked our staff to get behind us we asked our city council one by one to be courageous to step up to the plate and that we would step up to the plate with them so that we could diversify our water supply. And in answer to your first question I will tell you this yes we decided to go desal but only because at that time the price was too high and as board of trustees we have a fiduciary responsibility to you for how much we're going to pay for the water is it going to be a fixed price? Are we going to get the pipeline at the end of 30 years not pay for it but we're already paying for it along the way so we're going to get it is it going to be a way to grow our economy you grow your economy it creates jobs and one thing we didn't mention today's talk was affordability we have not forgotten about the poor people that need to have affordable water another thing we did not mention was building over the aquifer and by that I mean responsible building over the aquifer we've always as citizens been very responsible there so I stand before you today as chairman of SAWS a volunteer job to ask for your help it's going to take every single one of us in this community to make this happen and to secure our future for our children and our grandchildren I told the city council in an executive session that maybe today people won't appreciate your vote and 20 years from now nobody will remember who did it but 20 years from now when water could be who knows you name a price you're well done said I'm going to say $15,000 just to scare you somebody will say someone way back 20 years ago had the courage and had the vision to do what was right so I want to thank each and every one of you for being here our panelists Evan Smith for asking very good questions Dr. Romo Dr. Sines and all of you who participated today for caring and we're going to ask for your help have a great afternoon thank you