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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 05/29/2018 - RESOLUTION 2018-053 DIRECTING THE CITY MANAGER ORAgenda Item 1 Item # 1 Page 1 AGENDA ITEM SUMMARY May 29, 2018 City Council STAFF Jennifer Shanahan, Watershed Planner Adam Jokerst, Water Resources Engineer Carol Webb, Water Resources/Treatmnt Opns Mgr Eric Potyondy, Legal SUBJECT Resolution 2018-053 Directing the City Manager or His Designees to Meet with the Northern Colorado Water Conservancy District to Negotiate a Potential Agreement Regarding the Northern Integrated Supply Project. EXECUTIVE SUMMARY The purpose of this item is twofold: 1) to provide a status update on the Northern Integrated Supply Project (NISP) in advance of the release of the project’s Final Environmental Impact Statement (EIS), anticipated for late June 2018; and 2) to consider a resolution that would direct the City Manager and/or his designees to meet with the Northern Colorado Water Conservancy District (Northern Water) to seek to and to engage in negotiations regarding the City’s key remaining concerns and issues related to NISP. Some of the City’s key concerns regarding NISP’s impacts, as expressed in previous Council resolutions, have not been adequately addressed to date. NISP continues to make progress toward receiving all necessary permits and approvals to ultimately be constructed and operated as currently proposed. Meanwhile, the City’s ability to influence the project through participation in permitting processes is diminishing. Negotiating with Northern Water may provide a means to address some of the City’s remaining concerns. Staff is requesting authorization to negotiate with Northern Water regarding NISP where mutual interests may be addressed. Any draft agreement(s) would be presented to Council for its review and approval. STAFF RECOMMENDATION Staff recommends adoption of the Resolution. BACKGROUND / DISCUSSION Federal and State Permitting NISP, a proposed water supply and storage project serving 15 communities and water districts in northern Colorado (including the Fort Collins-Loveland Water District that serves portions of southeast Fort Collins) has been undergoing federal and state permitting for the project for the past 14 years. NISP requires four primary permits, among other authorizations, listed below. 1. Section 404 of the Clean Water Act Permit (404 Permit). This permit is generally considered to be the key permit for NISP, and its issuance requires compliance with the National Environmental Policy Act (NEPA). NISP appears to be approaching the end of the process for the 404 Permit and NEPA. As discussed below, the Final EIS is currently scheduled to be released in late June of 2018. There will be a period of public comment, which is expected to be approximately 45 to 60 days, though Staff plans on requesting an extension to allow 90 days of comment. The U.S. Army Corps of Engineers Agenda Item 1 Item # 1 Page 2 (Corps) will subsequently issue a record of decision (ROD) on the issuance of the 404 Permit for NISP, but is unlikely to allow additional public comments past the Final EIS or on the ROD. 2. Fish and Wildlife Mitigation Plan. NISP has received approval from the State of Colorado for NISP’s Fish and Wildlife Mitigation and Enhancement Plan (State Mitigation Plan) under C.R.S. §37-60-122.2. Adoption of the Mitigation Plan constitutes the State’s “official state position on the mitigation actions required” of Northern Water for NISP. Staff submitted comments on the then-proposed plan pursuant to Resolution 2017-073. 3. State Water Quality Certification. NISP needs a water quality certification from the State under Section 401 of the Clean Water Act and state regulations. This certification attests that a project will comply with applicable federal and state water quality regulations, including those regarding temperature. This process is underway. It is anticipated that the permit application will be released for public comments in late 2018 or early 2019. 4. Larimer County 1041 Permit. NISP needs a permit (or an agreement in lieu of a permit) from Larimer County under its Land Use Code (a.k.a. “1041 regulations”). The 1041 regulations have twelve listed criteria, ranging from public health and safety, to consistency with County plans, to mitigation. It is staff’s understanding that Northern Water has initiated discussions with Larimer County for an agreement in lieu of this permit. The City does not have decision authority with respect to any of NISP’s permits. Past City comments have resulted in changes to NISP that have addressed some of the City’s concerns. However, the City is expected to have limited ability to influence the project through the various permitting and approval processes moving forward. To date, the City has participated in the various permitting processes as a stakeholder. Past actions include: 1. Providing comments on the Draft EIS in 2008 as provided in Resolution 2008-082, which states: “That the City Council opposes NISP as it is described and proposed in the [Draft] EIS and also opposes any variant of NISP that does not address the City’s fundamental concerns about the quality of its water supply and the effects on the Cache la Poudre River through the City, which are critical to the City’s quality of life, health, economic development and environment.” 2. Providing comments on the Supplemental Draft EIS in 2015 as provided in Resolution 2015-082, which states: “That the City Council cannot support NISP as it is currently described and proposed in the [Supplemental Draft] EIS, with the understanding that the City Council may reach a different conclusion with respect to a future variant of NISP…if such variant addresses the City’s fundamental concerns…” 3. Providing comments on the State Mitigation Plan in 2017 pursuant to Resolution 2017-073, which states that nothing in it “shall be construed to affect the City’s position regarding NISP. As described in Resolution 2015-82 and Resolution 2017-024.” (Resolution 2017-024 is discussed below.) Currently, the Corps is drafting a Final EIS, which the Corps is expected to release in late June 2018. The Corps is not required to accept, and commonly does not accept, comments on a Final EIS, but has indicated it will allow public comments on the NISP Final EIS. Staff intends to prepare comments on the Final EIS for City Council’s consideration. Staff intends to focus its technical comments on the Final EIS on impacts to the City and on addressing remaining gaps and inadequacies in the analyses, conclusions, and mitigation proposed for NISP. Staff expects some new information will be provided in Final EIS, primarily related to analysis of water quality impacts and information related to changes and adjustments to the project outlined in the Mitigation Plan. The Final EIS will be the City’s last formal opportunity to comment on the 404 Permit in the federal permitting process. The Corps will consider the City’s comments on the Final EIS, but is not required to follow City recommendations. Agenda Item 1 Item # 1 Page 3 NISP Status and Remaining Concerns Past City comments have positively influenced NISP; the project as designed today is considerably different than the version first proposed and the version set forth in detail in the initial Draft EIS in 2008. For example, City comments have influenced NISP operations as now proposed to maintain more water in the Cache la Poudre River and have led to stronger mitigation measures. City comments have also resulted in more detailed and rigorous environmental studies for certain resources. However, for certain other resources, gaps and inadequacies in environmental studies remain. A key mitigation element developed in 2017 is the Peak Flow Operations Plan. This plan partially addresses the City’s long-standing concern that NISP will reduce annual flushing flows, flows that create habitat, sustain riparian areas, and maintain channel conveyance needed to safely pass flood events. NISP’s Peak Flow Operations Plan proposes tiered operations that will result in some degree of peak flow bypasses in 90% of years, and full 3-day bypasses of peak flows in 70% of years. NISP’s Mitigation Plan also includes many measures that, while not directly mitigating NISP’s impacts, do improve conditions on the Poudre River. For example, NISP now proposes installation of fish passage on numerous diversion structures through Fort Collins. Also, NISP now proposes a “conveyance refinement” enhancement that will ultimately release up to 18 to 25 cfs of project water back to the Cache la Poudre River (depending on participant demands). Such releases will improve base river flows through much of the City and represent an improvement to current baseflow conditions to Mulberry Avenue. The appended table summarizes key issues raised in past City comments on NISP, identifies whether those issues have been addressed, and lists remaining concerns. The appended table summarizes extensive City comments on the 2008 Draft EIS, 2015 Supplemental Draft EIS, and 2017 Mitigation Plan, and thus, greatly simplifies past City positions. Despite these improvements, Staff remains concerned that NISP will negatively impact City assets and interests. Remaining key concerns are provided in the table below. This table also provides Staff recommendations of potential additional mitigation to offset some of NISP’s impacts. It is Staff’s view that certain impacts from NISP, such as increased river depletions, are impracticable to avoid and/or mitigate completely if the project is to be built and still maintain yield. Staff has, however, developed clear suggestions for the best next steps for better mitigation of impacts from NISP. For example, for impacts related to reductions in river flows, Staff advocates a full 3-day peak flow bypass every year, adaptive management in the form of flows, and restoration of river-floodplain connection to reduce increased flood risk. Key Remaining Issues and Concerns Potential Additional Mitigation Peak Flows and Flood Risks NISP will reduce peak flows which will increase flood risks and decrease river health and function. • Three-day peak flow bypasses every year • River-floodplain reconnection projects to reduce flood risks • More robust adaptive management plan that uses flows as the primary management response Base Flows NISP will increase base flows to Mulberry Ave., but full benefits may not be realized until build-out. • Operate full conveyance refinement at project startup • Base flow provisions dependent on NISP diversions rather than participants’ demands Water Quality NISP’s impacts to Poudre River water quality and wastewater dilution requirements are unknown. • Mitigation requirements depend on impacts determined in Final EIS water quality studies Agenda Item 1 Item # 1 Page 4 Key Remaining Issues and Concerns Potential Additional Mitigation Adaptive Management Current adaptive management plan and process not clearly defined and inadequately funded. • City involved in implementation • Third-party monitoring and verification • Defined, physical-based performance metrics • Enforce changes to future NISP operations Mitigation Funding Mitigation/enhancement funds should match the scope of NISP’s impacts. • Increased funding for channel improvements • Increased funding for enhancement projects. • Increase amount and duration of adaptive management monitoring funding Potential Negotiations The City’s previous comments and participation in the federal permitting process has resulted in changes to NISP that have addressed some of the City’s concerns, as discussed above. However, the City is expected to have limited ability to influence the project through the various permitting and approval processes moving forward. This is due to several reasons (several of which are discussed further below): the federal permitting process is coming to an end and there is only one main formal opportunity to participate in the federal permitting process; NISP has been vetted for numerous years resulting in the project as currently proposed; and indications from the Corps and Northern Water are that no major changes will result from this process. Staff thus recommends engaging in direct negotiations with NISP. Negotiations would commence with the goal of meeting mutual interests between the City and Northern Water. In part due to the City’s and Northern Water’s multi-faceted interests and various points of interaction, Staff believes there is the potential for mutual benefit to result from such negotiations. For example, negotiations could lead to cooperative river projects that benefit both the City’s long-term interest in improving the health of the Cache la Poudre River and Northern Water’s interest in mitigating NISP impacts. Negotiations could improve upon the status quo and current trajectory of the Cache la Poudre River, but that can only be known through exploring negotiations. It should be noted that it is unclear at this point if Northern Water desires to negotiate, though Staff anticipates that Northern Water will be willing to explore this option. Council has previously considered a similar request. At a February 21, 2017 City Council meeting, Staff sought a resolution to, among other things, be authorized to negotiate and prepare draft agreements with Northern Water that would be presented to City Council for its review and possible approval. After a lengthy consideration of this discussion item, City Council removed all references to negotiation from the proposed resolution. The resulting Resolution No. 2017-024 instead authorizes Staff “to meet on a regular basis with Northern Water regarding NISP and to discuss and explore the City’s concerns and interests in order to ascertain whether those interests can be met, including through potential solutions to address the City’s goals and issues related to NISP.” Staff has thus not historically negotiated with Northern Water on NISP, but has held regular meetings to discuss project status and the City’s concerns. Staff believes that, compared to negotiations, such discussions are less beneficial to the City’s interests. Certain events have transpired that have lead Staff to again recommend the City undertake direct negotiations: 1. NISP continues to make progress towards acquiring all permits. Based on input from permitting experts and observations of other water supply permitting projects, Staff increasingly believes that NISP will ultimately be issued all such permits and will be constructed as currently proposed. 2. The Final EIS is the last of three rounds of public comment on the 404 Permit. Thus, Staff does not believe that the Corps will make many, if any, substantive changes to the configuration and operation of NISP based on comments received on the Final EIS. It is unlikely that City comments on the Final Agenda Item 1 Item # 1 Page 5 EIS will significantly alter NISP or that the City’s remaining concerns can be addressed simply by its stakeholder role in the various permitting processes. 3. The Corps and City are relying on complex science and computer models in evaluating NISP’s impacts. It has become increasing clear that for certain issues, there often is not a clear, black-and- white answer on what the impacts will be and what mitigation is required. This uncertainty decreases the City’s ability to effectively influence the project through public comments, and will make it difficult to challenge the Corps’ findings. 4. Staff believes little, if any, changes to NISP’s Mitigation Plan will occur because of comments made on the Final EIS. The State’s approval of NISP’s Mitigation Plan in 2017 is a strong indication that additional comments will not achieve significant changes to NISP’s mitigation package. 5. While past discussions with Northern Water have been productive, the value of continued discussions, short of direct negotiations, is limited. Northern Water likely sees little value in addressing the City’s concerns unless the City is willing to offer something in return. For these reasons, Staff recommends that the City enter direct negotiations with Northern Water outside of the various permitting processes. Under this approach, the City would seek to pursue a negotiated agreement with Northern Water to address NISP’s impacts and achieve greater mitigation. A preliminary list of items the City could seek in negotiations is above. A negotiated agreement with Northern Water may further benefit the City by providing a mechanism for the City to enforce future mitigation measures related to NISP. Outside of an agreement, the City would rely on federal and state agencies to enforce NISP mitigation. Staff believes such negotiations may benefit the City. However, any such agreement would entail tradeoffs. Until negotiations begin, it is unknown what Northern Water would seek from the City. It is possible Northern Water could seek assurances from the City to expediate remaining permitting or facilitate mitigation implementation, among other actions. As with any such discussions regarding complex matters and potential agreements, there are no guarantees of success. Furthermore, the approach will depend on Northern Water’s willingness to participate. Staff sees no substantive downsides in engaging in negotiations with Northern Water. A negotiated agreement, if reached, would need to be brought to City Council for review and possible approval. Staff will also provide City Council regular updates concerning negotiation status. CITY FINANCIAL IMPACTS N/A BOARD / COMMISSION RECOMMENDATION Staff consulted three City advisory boards prior to the February 21, 2017, City Council meeting regarding NISP negotiations. On January 11, 2017, and January 18, 2017, the Land Conservation and Stewardship Board and the Natural Resources Advisory Board, respectively, voted unanimously to oppose Staff’s recommendation to pursue negotiations with Northern Water. On January 19, 2017, the Water Board voted 7 to 1 to support Staff’s recommendation to pursue negotiations. Subsequently, in 2017 the Water Board held three Work Sessions to discuss NISP in detail. Water Board provided it findings and recommendations to City Council by letter dated December 12, 2017 (attached). Agenda Item 1 Item # 1 Page 6 PUBLIC OUTREACH Staff provided public outreach prior to the February 21, 2017 City Council meeting. Presentations were made to three Council advisory boards (see above) and to City Council on January 24, 2017. An open house was held on February 13, 2017. Comments from the open house are attached. Staff also participated in three Water Board Work Sessions on NISP in 2017. Staff has developed a public engagement plan for the City's response to the Final EIS which is attached. ATTACHMENTS 1. Key Issues in past City Comments, NISP Revisions and Mitigation Measures, and Remaining Concerns (PDF) 2. Summary of Water Board Work Sessions on NISP (PDF) 3. Frequently Asked Questions (PDF) 4. Public Engagement Summary (PDF) 5. Power Point Presentation (PDF) Key Issues in past City Comments, NISP Revisions and Mitigation Measures, and Remaining Concerns Key Issues Past City Comments 1 Project Revisions and Mitigation Measures 2 Remaining Concerns Water Quality Issues Source Water Quality • Proposed Glade to Horsetooth pipeline, potential use of Pleasant Valley Pipeline (PVP), and/or increased residence time in Horsetooth Reservoir could degrade quality of City’s drinking water supply • Water quality studies insufficient • Removed Glade to Horsetooth pipeline • Residence time no longer a concern; NISP water no longer delivered through Horsetooth exchanges • Use of PVP requires City permission • PVP concerns remain but can be addressed outside of permitting process Poudre River Quality and Wastewater Treatment • Increased treatment and cost to stay compliant with City’s discharge permits • Water quality degradation and potential regulatory standards exceedances • Conveyance refinement may lessen water quality impacts above Mulberry Ave. • Multi-level outlet tower and release aeration • Water quality monitoring • Impacts to wastewater treatment and cost not addressed • Conveyance refinement does not address water quality impairments below Mulberry Ave. • Conveyance refinement needed as soon as NISP impacts begin • Water quality studies needed (anticipated in Final EIS) Trichloroethylene (TCE) Groundwater Contamination • TCE contaminated groundwater from abandoned missile site could migrate to Poudre River • Additional study needed • Additional monitoring and analysis by Key Issues Past City Comments 1 Project Revisions and Mitigation Measures 2 Remaining Concerns Poudre River Aquatic Habitat and Life • Degradation of spawning habitat and food source due to reductions in peak flows. • Reduced river flows will impair water quality and harm aquatic life • Insufficient study data and methods • Peak Flow Operations Plan lessens concerns • Conveyance refinement may improve base flows and habitat availability and lessen water quality impacts above Mulberry Ave. • Diversion structure retrofits • $1M for stream channel and habitat improvement plan • Stream channel and habitat projects (upstream of City) • Additional study provided • Peak Flow Operations Plan is insufficient, particularly by omitting peak flows following drought years • Conveyance refinement does not address water quality impairments below Mulberry Ave • Conveyance refinement needed as soon as NISP impacts begin • Insufficient funding of stream channel and habitat improvements Terrestrial Wildlife • Loss of wildlife in riparian areas • Impacts to big game habitat near City’s Gateway Natural Area • Insufficient study • Increased commitment to conserve lands near Glade Reservoir • Hwy 287 fencing and underpass • Additional study provided • Proposed Peak Flow Operations Plan is insufficient • Longer duration peak flows needed to maintain wetlands and riparian areas Water Management Issues Flood Risks • Reduced peak flows may lead to sediment accumulation and reduced channel capacity for conveyance of flood flows, increasing City’s flood risk • Peak Flow Operations Plan lessens concerns Key Issues Past City Comments 1 Project Revisions and Mitigation Measures 2 Remaining Concerns Other Issues Socioeconomics, Recreation, and Aesthetics • Changes to river health would adversely affect recreation, visitor experiences, and associated economic benefits in Fort Collins. • Mitigation funding • Recreation on Glade Reservoir and Poudre River parking area • Potential to increase flows for rafting in lower canyon • $1M for stream channel and habitat improvement plan • Recreation mitigation primarily focuses on areas outside of Fort Collins • Adverse effects to river health in City not adequately addressed • Insufficient funding of stream channel and habitat improvements Climate Change • Climate change not properly considered • Large pumping requirements would increase region’s greenhouse gas emissions • Additional climate change study provided • Allowances for hydropower generation at Glade Reservoir • Increased greenhouse gas emissions not addressed Air Quality • Air pollution negatively impacted by construction and motorized boating on Glade Reservoir • Insufficient study • Construction BMPs to address some air pollution • Additional study provided • Air quality impacts, particularly from construction traffic, not addressed Mitigation Funding • Mitigation funding should be increased • $53.3 million proposed for mitigation and enhancements • Mitigation funding is insufficient and should match the scope of NISP’s impacts Utilities – Water Board 700 Wood St. PO Box 580 Fort Collins, CO 80522 970.221.6702 970.416.2208 - fax fcgov.com M E M O R A N D U M DATE: December 12, 2017 TO: Mayor Troxell and Councilmembers FROM: Water Board THROUGH: Darin Atteberry, City Manager Kevin R. Gertig, Utilities Executive Director RE: Summary of Water Board Work Sessions on NISP Background and Purpose In May, the Water Board decided that it would dedicate a set of Water Board work sessions to digging into important water issues facing Fort Collins Utilities and the City, hereafter generally referred to as the City in this memorandum. The Northern Integrated Supply Project (NISP) was selected as one of the most important and controversial water issues facing the City in the near term. Over a series of three work sessions in June, August, and October, the Water Board discussed various aspects of NISP and the City’s relationship with the project, now and into the future. Our original goals of this effort were: (1) To become more informed about NISP, by building a basic knowledge foundation in order to better deliberate and act on NISP-related items that will likely come before the Water Board in 2018 and beyond. (2) To better understand the options available to the City in opposing and/or addressing aspects of NISP that cause negative impacts to the City’s water management and Poudre River function. This memorandum provides a summary of the Water Board’s discussion on NISP. It is organized by the discussion topics of the three Water Board work sessions. We hope that City Council finds this information useful when making future decisions related to NISP. Attached to this memo is a table summarizing the key concerns of the City, mitigation of those concerns that the City has previously sought, and the mitigation that was recently approved by the state under the Fish and Wildlife Mitigation and Enhancement Plan. The table also provides emerging ideas on how the City can take a proactive role in mitigating impacts of NISP using its own resources. It is important to note that several activities related to NISP have occurred in parallel with the Water Board work sessions. First and foremost, the City has continued to have a dialogue with Northern Water about the project with the end goal of minimizing negative impacts to the City’s natural resources and water system. A total of six meetings have taken place with Northern Water, following City Council’s support for starting these discussions in February 2017. In addition, a draft NISP Fish and Wildlife Mitigation and Enhancement Plan was released for comment in June 2017 and City staff made significant comments to enhance mitigation activities. The Mitigation Plan was approved by Colorado Parks and Wildlife and by the Colorado Water Conservation Board in September 2017. Since the Water Board work sessions started, additional information has developed about how the project will be operated and the extent of impact on the Poudre River. A clearer picture of NISP exists today compared with six months prior. ATTACHMENT 2 Meeting #1: Impacts of NISP June Water Board work session The first Water Board work session was devoted to better defining both the positive and negative impacts of NISP to the City. Much of the discussion on NISP in Fort Collins has centered on the detrimental effects of reduced streamflows on the health and function of the Poudre River. It is also important to recognize that a portion of the City’s Growth Management Area (GMA) will be served by the project by providing raw water supply to the Fort Collins Loveland Water District. The following points summarize our discussion of NISP impacts to the City. Positive Impacts x Increases in winter-time streamflows in the Poudre River through the City corridor, with possible river flow during historical “dry-up” reaches of the river in the winter. This should benefit fish and aquatic species, and could benefit water quality of the Poudre River below the effluent discharge points for City’s two water treatment (reclamation) facilities. x Additional water supply to the Fort Collins-Loveland Water District, which currently services approximately 15% of Fort Collins households. The District has subscribed for 3,000 acre-feet of yield from the project, which should help to meet its projected District-wide demands for roughly a decade. It should be noted that most of the demand growth in the District service area is expected to fall outside of the Fort Collins GMA. x Recreational opportunities are proposed to be available in Glade Reservoir. x Additional water storage capacity will not benefit Fort Collins Utilities, but it is considered a benefit to the Northern Colorado region. Additional storage is intended to help meet the water demands of regional population growth and is anticipated to provide flexibility in managing water resources in light of climate change uncertainty. As a related benefit, NISP may help to preserve water rights in the agricultural sector by providing a major water supply source for many fast growing communities, as an alternative to “buy and dry” of farmland. Negative Impacts x Reduce the ability for the Poudre River channel to convey flood flows, due to the lack of large scouring flows and the aggradation of sediment in certain river reaches within the City. This reduced flood conveyance capacity could result in a widening of the floodplain, an increase in flood frequency, and/or an increase in flood severity, in some reaches. Sediment aggradation around canal head gates may impact their operation. Sedimentation also may result in the need to raise bridges. x The project involves extensive pumping of water up into Glade Reservoir, with associated energy requirements, demands on local power sources, and corresponding carbon emissions impacts. For perspective, NISP annual pumping power requirements are estimated to be approximately 2% to 4% of the City’s total annual electric demand. x Summer river flow levels are likely to be decreased, which could impact current recreational uses of the river in the City and associated visitors to the City reaches of the river. x At times of reduced flow levels, there will be less flow to dilute the City’s wastewater effluent and could cause problems for the City meeting water quality standards at its discharge point. x A reduction in both peak flows and summer-time flows will likely impact aquatic species and riparian habitat within the City. x Raw water quality available to the City for its treatment and use may be affected by longer water retention times in Horsetooth Reservoir, specifically an increase in total organic carbon. x The Glade Reservoir dam site is located in close proximity to an abandoned missile silo site, which is known to have groundwater contamination concerns. There are questions on how the construction and operation of Glade Reservoir might interact with this legacy site. A quick review of these impacts shows a familiar story. Water development activities to help service new municipal water demands will have negative impacts on the river and riparian environment. The impacts on the river are bifurcated by season, with some winter-time benefits and some summer-time detriments. On the whole, the project is considered to be a net loss to the City’s river environment. Considering the continued population and economic growth that the Northern Colorado region will see, the project clearly provides a benefit as a major water supply source for the region. Meeting #2: Alternatives August Water Board work session The second Water Board work session was a discussion of alternatives. The Board discussed what options the City could take in responding to and challenging NISP. We defined the following potential options: 1. Negotiate with Northern Water on better mitigating negative impacts of the project. This option is the one currently being pursued by the City, following the City Council vote in February 2017 to pursue a discussion with Northern Water. City Council did not refer to these discussions as a negotiation. City staff have defined a set of target mitigation goals that they seek to achieve as part of these discussions. A list of these goals is provided later in this memo. At the present time, and specifically with the recent approval of the NISP Mitigation Plan, it is not clear how this dialogue between Northern Water and the City should continue. 2. Challenge the NISP Record of Decision in court. The City could file a lawsuit against the U.S. Army Corps of Engineers stating that the decision to allow construction of NISP was “arbitrary and capricious” and did not take into account the full suite of information. In a sense, the City would have to challenge certain aspects of the NISP project. The City would not want to challenge all technical aspects, because the City shares many datasets and assumptions in developing its own Halligan Reservoir Expansion EIS document. The City might seek to challenge two aspects of NISP: (1) Purpose & Need, developing information to support the idea that the project participants do not actually need this new water supply, or (2) Alternatives, arguing that the Corps of Engineers did not consider all of the viable water supply alternatives in the environmental permitting process, particularly if there exist alternatives that are less- damaging to the environment. There are several roadblocks to the City challenging NISP simply on the basis of river impacts within the City. First and foremost, the project seeks to develop a valid water right which has been decreed in water court. Colorado’s system of water laws do not inherently protect river conditions outside of specific (often junior-priority) appropriations for environmental flows. Second, some of the anticipated impacts to the City are not well-aligned with the Federal or State permitting requirements. Even if the City were successful in challenging the Record of Decision, the court would likely ask that the Corps revisit its decision, and thus delay but not defeat the project. So long as the project participants have an appetite to continue funding the development of NISP, a lawsuit is not likely to be a final decision on the project. Finally, the City should consider how its actions on NISP, particularly a lawsuit, might impact the comments received on the Halligan EIS and the overall pursuit of additional storage capacity in Halligan Reservoir. 3. Petition the Environmental Protection Agency to veto the project. Following a Record of Decision, assuming that the ROD is favorable to continued development of NISP, the City could petition (or request) that the EPA exercise its authority to veto a project if it presents irreparable harm to the environment. This EPA veto action is what halted the development of the Two Forks Dam project in the 1980s. The EPA has exercised this veto authority about 20 times in history (which represents less than 1% of all Federal water projects), all of which were tied to large-scale projects that had significant opposition. The probability that the EPA, and certainly the current EPA administration, would veto the project is considered low. 4. Lobby Congressional delegation for mitigation improvements. Switching branches of government, Fort Collins could pressure its representatives in Congress to develop required mitigation conditions to offset the negative impacts of the project. However, NISP does not require Federal funding, and therefore Congress would have limited ability to influence the project. Elected officials representing Northern Colorado may not want to challenge the project, as it benefits their constituents as well. 5. City would develop its own mitigation. A final option is for the City to develop its own mitigation efforts and projects to offset the negative impacts of NISP. This option would mean that staff and financial resources are focused on projects that the City can pursue while the NISP project continues to be developed. The City would utilize its assets and resources to build its own mitigation plan for NISP. Ideas for a City mitigation plan are presented as a table attached to this memorandum. One aspect of City mitigation which was discussed at the meeting is the concept of the City using a portion of its currently unused water rights portfolio to provide strategic environmental flows in the Poudre River. First, it was concluded that dedicated storage releases from an expanded Halligan Reservoir (which the City is currently pursuing) are unlikely to significantly benefit the Poudre River through the City and offset the impact from NISP. The reason is because Halligan is a relatively small storage reservoir, and the small release volumes are likely to primarily benefit streamflows in the North Fork of the Poudre River. Second, the City owns several agricultural ditch rights which it has not yet converted for municipal use and could be applied to environmental uses. In addition, the City’s water rights portfolio in the Poudre River has some excess supply in average and wet years. Available modeling suggests that Glade Reservoir storage levels will be much less than full capacity in most years, providing a storage void into which the City could put its unused direct-flow water rights. City staff have not analyzed this possibility in detail, but conceptually this could provide significant benefit if the City were to make peak flow releases from its stored water in Glade Reservoir. There are many aspects that would need to be considered, but perhaps most important would be the creation of an environmental storage pool in Glade Reservoir as part of the Record of Decision, allowing third- parties (non-participants in the project) to store water in Glade Reservoir. In defining these options, we considered that City staff are likely to continue to draft substantive comments during the permitting process for NISP. Most of the comment period has passed, with a Final Environmental Impact Statement (EIS) for NISP due in January 2018. The Corps of Engineers is not required to consider comments on the Final EIS when issuing the Record of Decision, but City comments are important to provide information to the Corps as it defines mitigation conditions in the Record of Decision. The City will also provide comments on other State agency permit documents, but should consider how these efforts will alter the project from its current form. The other aspect of our Alternatives discussion was what alternatives existed for the NISP project participants, and in particular the Fort Collins – Loveland Water District, if NISP were not permitted and not constructed. In the EIS process, the “No Action” alternative was presented as another regional storage project named Cactus Hill Reservoir, located east of Fort Collins. This alternative is not desired by the project participants and the EIS does not find it to be less environmentally damaging. The Board discussed some flaws of the EIS process and study documents. The Corps made a seemingly arbitrary decision to mandate that any alternative in the EIS process must be a regional water project. For the Fort Collins – Loveland Water District, future water supply development besides NISP will likely include development of water storage from former gravel pits, continued acquisition of CBT units in the short term, and additional acquisition of agricultural ditch rights which divert from the Poudre River in the longer term. The possibility of a wholesale water purchase from Fort Collins Utilities was previously explored for several Southside Ditch rights, but use limitations expressed on the Utilities water right decrees prevented their use beyond the Utility service area. Meeting #3: Mitigation & Moving Forward October Water Board work session The third and final Water Board work session was focused on how the City might seek mitigation for the negative impacts caused by NISP, and ideas about how the City might continue to move forward. The purpose of the meeting was influenced by the recent approval of the Mitigation Plan by Colorado agencies in September 2017. The City’s ability to influence required mitigation, at least those aspects regulated by the state, is limited given the approval of the Mitigation Plan. Therefore, the mitigation discussion was kept rather brief, and we focused on moving forward. Additional mitigation will be defined in the Record of Decision, with the term “mitigation” focused on impacts to wetlands, stream reaches, and conveyance capacity of the river channel. City staff’s comments on the Draft EIS and Final EIS will hopefully influence the quality of mitigation defined in the Record of Decision. In the near future, the City will also be commenting on the State water quality 401 permit decision. Most Water Board members believe that there will likely be a gap between the City’s desired mitigation and the type and level of mitigation that will be required for NISP under Federal and State permits. Part of our discussion on moving forward focused on how the City should best address this gap. The Water Board focused its final discussion piece on how the City should move forward with respect to advancing its concerns with NISP. No detailed position was developed by the Water Board, but Board members expressed the following points as considerations and recommendations for future actions of City Council with regard to NISP: x The City has spent considerable resources (staff time and consultant funding) in analyzing and challenging NISP with the goal of minimizing impacts on the City, particularly with regard to Poudre River health and function. A team of 12 outside consultants have previously been engaged by the City to help develop comments in the EIS process. This resource expenditure has resulted in some significant changes to the NISP project. Specifically, the inclusion of a bypass flow through the City and the changes in project operations defined in the approved Mitigation Plan. From here, these resources can and should be leveraged to help develop a City mitigation plan for NISP. Several Water Board members believe that the City should start to develop its own mitigation plan and not rely on Federal and State agencies to get mitigation right for the City. The attached table provides specific ideas on how the City might develop its own mitigation. Time is of the essence in starting to build this plan if that is what City leaders want to do. x A legal challenge to the Corps’ Record of Decision on NISP would be costly and highly uncertain. It is not an exaggeration to say that the City would have to spend millions of dollars to successfully challenge the Corps decision. Several Water Board members feel that developing a City mitigation plan could represent a fraction of the cost of a legal challenge and/or provide a far more certain outcome. x The NISP project represents a piece of a much broader water management discussion for Northern Colorado, and there are other issues which might actually be more important than NISP moving forward. These issues include: land use planning at both local and regional levels, irrigation ditch company planning, and advances in water conservation. The City might have more of a long-term impact leading on these issues than it would in standing opposed to NISP. Some Water Board members feel that as long as there is unappropriated streamflow in the Poudre River system, there will be some interest in developing a project to utilize the water supply. In other words, even if NISP does not become a reality, there will be others waiting to develop a similar project. x At least one Water Board member felt that the City should make a commitment on where it stands related to NISP. Historically, the City has been simultaneously opposed and neutral to the project, while some in the community feel that the February 2017 decision to engage in discussions with Northern Water was effectively an admission that the project will be completed. Some Water Board members feel that the City should take a strategic view on how to best react to the NISP project, and start to build on that strategy, rather than remain uncommitted. x If NISP continues to move forward, then several Water Board members have expressed a concern about data and information transparency, which has historically been lacking on NISP reports and analyses to date. In the future, the dialogue among stakeholders can be improved if more data and information are shared. A lack of transparency coupled with typically short EIS review period presents challenges to understanding and responding to the EIS. The City should continue to advocate for open data policies and lead by example. x Members of the Water Board also feel that collaboration among stakeholders may be a requirement to deal with some of the NISP impacts and to ensure that the Poudre River is able to provide for multiple benefits. This is due to the complexity of river operations and the inter- connections among water users and uses. A single entity acting alone will struggle to provide sufficient staff and financial resources to address water management issues in the Poudre River system. Within this collaborative environment, monitoring of critical river metrics, such as streamflow and water quality, will be essential to future management of the Poudre River, and NISP participants and other regional water users should contribute to these efforts as an extension of existing data collection and management programs. As stated previously, a table is attached which summarizes issues of concern and ideas for mitigation of those concerns. I hope that the information contained in this memorandum proves helpful in future deliberations and action items on NISP that come before City Council. Please contact the Water Board with any clarifying questions or follow-up comments. Sincerely, ___________________________________ Brett Bovee, Water Board Chairperson Attachment: Table of issues and mitigation ideas Issue/Concern City’s Mitigation Comments1 NISP’s Mitigation Plan2 Possible Future Action(s) for Consideration Peak Flows/Stormwater NISP will reduce peak flows which will increase flood risks and decrease river health and function. • Provide 3 day bypass every year • Large scale river-floodplain reconnection upstream and through the City to reduce flood risk • No further reductions to rise and fall of peak flows • 6 Tier peak flow bypass program • Full 3-day bypass achieved 70% of years • More frequent, shorter duration bypasses in certain years • Seek an environmental pool in Glade Reservoir to store non-NISP water (e.g. excess City sources as available) for peak flow augmentation (near-term) • Plan and fund large-scale floodplain restoration projects upstream of the City (long-term) Base Flows NISP will increase base flows, to Mulberry Ave, but full benefits may not be realized until build-out. • Provide full base flow via conveyance refinement at project start-up • 36% of all Glade releases to river at start-up • Interim delivery schedule coordinated through CPW • Advocate for delivery of Glade releases to river in lieu of other water supplies Ramping Rates Rapid flow changes are a safety hazard and can impact aquatic and riparian species • Flow changes should not exceed 500 cfs per day at Canyon mouth • 500 cfs per day ramping schedule adopted • None Water Quality NISP’s impacts to Poudre water quality and wastewater dilution requirements are unknown. • Postpose mitigation plan approval until data becomes available • Water quality data released in 2018 • Other water quality mitigation actions proposed (multi-level outlet tower, conveyance refinement, etc.) • Study the potential to acquire and develop small storage sites (like Rigden) near Drake to provide targeted WQ releases • Consider water lease options to provide targeted dilution to mitigate WQ impacts Adaptive Management 1 Frequently Asked Questions NISP Open House February 13, 2017 1) What is NISP? The Northern Integrated Supply Project (“NISP”) is a municipal water supply project designed and sponsored by the Northern Colorado Water Conservancy District (“Northern Water”) and fifteen municipalities and water districts, including the Fort Collins-Loveland Water District (FCLWD), a municipal water provider serving a portion of Fort Collins. At full build out and implementation, NISP would deliver 40,000 acre feet of water a year (for comparison, the Water Utility of the City of Fort Collins (“City”) currently delivers about 25,000 acre-feet a year). The project includes the construction of the 170,000-acre Glade Reservoir located north of Ted’s Place on Highway 287. The highway would be rerouted to the east side of the hogback. 2) Is the City a participant in NISP? The City and its Water Utility is not a participant. The Fort Collins-Loveland Water District, which serves southeast third or so of Fort Collins’ Growth Management Area, is a participant. It would receive about 3,000 acre feet of water annually and ultimately about 1,400 acre feet would be delivered to Fort Collins’ residents. 3) What is the City’s official stance on NISP? In 2015, City Council adopted Resolution 2015-082. The resolution states that “the City Council cannot support NISP as it is currently described and proposed in the [Supplemental Draft Environmental Impact Statement, dated June 2015], with the understanding that City Council may reach a different conclusion with respect to a future variant of NISP… if such variant addresses the City's fundamental concerns expressed in the City's comments to the [Draft Environmental Impact Statement] and comments to the [Supplemental Draft Environmental Impact Statement].” 4) Who decides if NISP can be built? In order to construct NISP, Northern Water must acquire several permits from federal and state agencies and from Larimer County. NISP requires no approvals from the City. The key permit that NISP needs is a Clean Water Act Section 404 permit from the U.S. Army Corps of Engineers (“Corps”). In order to issue this permit, the Corps must write an environmental impact ATTACHMENT 3 2 statement (“EIS”), which investigates the need for the project, evaluates alternatives, and studies environmental impacts. Results from the EIS are used for various other permitting processes. 5) History of NISP NISP’s participants formally agreed in 2003 to pursue the project. Shortly thereafter NISP entered the federal permitting process, which is administered by the Corps. In 2008, the Corps published a Draft EIS. Based on public comments, including comments from the City, the Corps decided to issue a Supplemental Draft EIS, which was published in 2015. The City reviewed the Supplemental Draft EIS and submitted numerous comments to the Corps. The Corps currently is preparing the Final EIS, which is expected to be complete by the end of 2017. Concurrently, the State of Colorado is preparing to review a Fish and Wildlife Mitigation Plan that Northern Water will submit in 2017. In addition, the Colorado Department of Public Health and Environment is preparing a water quality model and report that will be issues with the Final EIS. 6) What is staff proposing to City Council? Staff has proposed a resolution that would authorize staff to discuss and explore mutual interests pertaining to NISP with Northern Water. Staff would meet with Northern Water to discuss the City’s key goals and issues related to NISP, while regularly reporting to City Council. If mutual interests can potentially be met, staff would be authorized to negotiate draft agreements that would be presented to Council for its review and possible approval. 7) What is different about the staff proposal from past steps? In the past, the City has participated in the Corps permitting process as a stakeholder, submitting comments to the Corps when it published the EIS’s in 2008 and 2015. Staff has never been authorized by City Council engage in direct negotiations with the project proponent. 8) What would the City expect to gain for negotiating? The City may gain better outcomes than it could by relying on the permitting agencies. The permitting agencies have their own criteria and are not focused on impacts to the City. Staff is concerned that relying on these agencies to protect the City’s interests is risky and passive. By engaging Northern Water directly, the City’s concerns may be better addressed. Key issues of concern to the City include peak and base flows; biological affects to the Poudre; potential affects to storm water conveyance; and, affects to recreation. These concerns are extensively documented in the City’s 2008 and 2015 comments to the Corps. 3 9) What would the City give up by negotiating? The City would not give up anything by meeting with Northern Water to negotiate as proposed. It is not known at this time what the City may be ultimately requested to do to reach an agreement and to receive a benefit, although there a variety of potential scenarios. The City may maintain its lack of support for the project but agree not to comment on certain project elements. On the other hand, the City might adopt a position of neutrality. Although the City could adopt a support position – staff considers this an unlikely outcome given the known negative impacts of NISP. The decision of whether the City should give up or commit to anything would be decided by City Council later if a draft agreement were brought back to City Council. 10) Why is staff proposing this approach now? Why not just wait and see what happens? From staff’s perspective, the City faces a risk in relying solely on the permitting agencies to determine mitigation for impacts to Fort Collins. It is likely that the mitigation measures determined by agencies will be less rigorous than those desired by the City. Many state and federal agencies will be involved in the development of mitigation for NISP, each within their own regulatory arena. For example, mitigation of wetlands is overseen the Army Corps, mitigation of fish and wildlife is handled by CPW, and mitigation of endangered species is regulated by the U.S. Fish and Wildlife Service. Fort Collins interests are beyond a single resource and are focused on the overall ecological health of the Poudre River. This places the City in a unique position to advocate mitigation for NISP. While the permitting process is long and complex, the Final EIS is expected late this year. Further, the Fish and Wildlife Mitigation Plan will be finalized this year. The City’s ability to influence the Final EIS as well as federal and state mitigation plans is modest and, as noted above, the agencies are not focused on impacts to Fort Collins. As the permitting processes continue to march forward, in staff’s view, the City’s window to directly influence mitigation with the project proponent diminishes. 11) Does negotiating mean that the City will facilitate the construction of NISP? As part of the federal permitting process, the Corps must evaluate a range of alternatives to meet the needs of the NISP participants, and then from that range select the least environmentally damaging practicable alternative (or “LEDPA”). Corps guidance specifically precludes considering mitigation in making a LEDPA determination. Consequently, if, hypothetically, Northern and the City were to reach agreement on certain mitigation measures, these measures could not be used by the Corps in its selection of the LEDPA. Once the LEDPA has been selected, the Corps moves to the decision as to whether or not to permit the project. It is possible that if there were an agreement between the City and 4 Northern Water regarding mitigation, it could speed the Corps permitting process by reducing the number of comments submitted to the Corps or by simply leading to a better mitigation package that is easier to permit by the Corps. These implications would only be applicable if an agreement between the City and Northern Water were ultimately approved. They would be evaluated if a proposed agreement were to be brought back to City Council and the public following negotiations. The proposal to enter into discussions and negotiations does not itself facilitate NISP. 12) Will NISP harm the river? Flows, and in particular spring peaking flows, drive much of the overall condition on the Poudre River. NISP will take water out of the Poudre River primarily during the peak flow months of May, June, and July. If NISP is constructed, flows will be reduced on average 20% annually and 30% during the highest peak flow days. The reach from the NISP diversion near the canyon mouth through town will see the greatest reductions in flow. Under today’s river management, these reaches receive flows that are greatly reduced from the native flows. Studies conducted by the City, such as the Ecosystem Response Model have enhanced understanding of current and possible future conditions on the Poudre. Poudre River flows (both in volume and in inter-annual patterns) continue to support many essential ecosystem functions, yet they are approaching critical thresholds below which the river’s health and resilience will suffer. In sum, it is likely the health of the river will be negatively impacted by NISP, especially without well-planned and extensive mitigation actions. 13) Will the public get to weigh in on any mitigation proposals? How so? Yes. Staff would meet with Northern Water initially. If any concepts were generated by those discussions that would be of interest to the City, there would be outreach and discussion with City Council and citizen advisory boards such as the Natural Resources Advisory Board. In addition, there would be more general outreach with the public through, for example, open houses or web-based materials. Ultimately, it is up to City Council to make any final decision(s) about the City’s NISP related interests. PUBLIC ENGAGEMENT SUMMARY PROJECT TITLE: CITY’S RESPONSE TO NORTHERN INTEGRATED SUPPLY PROJECT (NISP) FINAL ENVIRONMENTAL IMPACT (EIS) STATEMENT OVERALL PUBLIC INVOLVEMENT LEVEL: Inform and Consult BOTTOM LINE QUESTION: What is your feedback on the City’s response to NISP Final EIS? KEY STAKEHOLDERS: Water Board, Land Conservation and Stewardship Board, Natural Resources Advisory Board City Council City Leadership River visitors River neighbors/ land owners Locally engaged scientific community Poudre water stakeholders and water districts Stakeholders involved in current collaborative efforts Community members TIMELINE: *The timeline is dependent upon when Army Corps of Engineers releases the Final EIS for comment, and the comment period they establish. Staff is anticipating the Final EIS will be released in late June with a 45-60 day comment period and possible extension up to 90 days. June/July- Preview to community through Coloradoan column, enewsletters, social media, website, email blast. OurCity, platform and preparation of City’s NISP website. Late June- Final EIS released, staff begins to analyze and formulate comments. Continue to reinforce preview messages. July- Identify broad-level themes that staff envisions including in City’s response. Share themes with City Council, Boards, and community via OurCity platform, board meetings, City Council meetings. Gather feedback from all and summarize for August City Council meetings. August- City Council considers staff-drafted response and resident feedback. September- Comments due to Army Corps of Engineers (ACOE) Key Messages: • Comments on the final EIS are just one way the City is working to positively influence outcomes. • The City has limited power to influence the process. • Anyone may directly comment to ACOE. Link provided to ACOE comment opportunity. • The timeline is likely to be 60 days and the document is extensive so the engagement timeline will be compressed. • The City is collecting feedback on the City’s response to the Final EIS, only. Background • City Council passed a resolution stating opposition to the project as it was then configured but that this position could change if a future NISP configuration addressed the City’s concerns (2015) ATTACHMENT 4 Tools and Techniques • Speaking points- internal • Coloradoan column • Outreach to Coloradoan, North Forty News, and KUNC reporters directly (preview, key messages)- new idea to prevent misinformation. Press release/media advisory could also be effective. • Board meetings • City Council meetings • Our City platform • NISP website • Email blast to stakeholders • Enewsletters (Natural Areas, Utilities) • Potential meetings/presentations/webinar with key stakeholders, upon request and depending on capacity • No open house is planned due to the compressed timeline 1 Northern Integrated Supply Project Status & Proposed Approach May 29, 2018 ATTACHMENT 5 Overview 1. City goals 2. Background and history 3. Modifications and mitigation 4. Remaining concerns 5. Staff recommendations 2 1. What are we working towards 3 1. Protect City assets and interests 2. Reduce risk and costs to the City 3. Ensure long-term resilience and sustainability 4. Maintain and build regional relationships What we are working towards 4 5 6 • Clean Water Act 404 Permit & National Environmental Policy Act • Clean Water Action 401 Certification • Colorado Fish & Wildlife Mitigation Plan • Larimer County 1041 Approval Permits and Process History 7 Permitting begins Draft EIS 2008-082: “…City Council opposes NISP as it is described and proposed in the [Draft] EIS and also opposes any variant of NISP that does not address the City’s fundamental concerns about the quality of its water supply and the effects on the Cache la Poudre River through the City…” NISP Timeline 2004 2008 History 8 2004 Supplemental draft EIS 2008 2015-082: “…City Council cannot support NISP as it currently described and proposed in the [supplemental draft] EIS, with the understanding that the City Council may reach a different conclusion with respect to a future variant of NISP….if such variant addresses the City’s fundamental concerns…” 2015 History 9 2004 2008 Fish & Wildlife Mitigation Plan 2015 2017 Staff proposes negotiations 2017-024: City Council directed Staff to discuss concerns with Northern Water, but did not authorize negotiations History 10 2004 2008 Final EIS 2015 2017 2018 2019 2020 Record of Decision 401 Certification Past Comments 11 Reduced River Flows • Flood Risks • Water Quality & Wastewater Treatment • Fish & Aquatic Life • Riparian Areas & Wildlife • Recreation & River Experience Past Comments 12 Construction & Operation • Source Water • Groundwater Contamination (TCE) • Air Quality • Climate Change • Habitat Loss NISP Modifications 13 • No Glade to Horsetooth pipeline • No Horsetooth Reservoir exchange • Conveyance refinement 14 NISP Conveyance Refinement Mitigation & Enhancement 15 • Peak flow operations • Diversion structure retrofits • Channel & riparian improvements • Land conservation • Monitoring & adaptive management Status 16 Mostly Addressed Partially Addressed Not Addressed • Source water • Groundwater contamination • Habitat loss from inundation • Flood risks • Fish & aquatic life • Riparian areas & wildlife • Recreation & river experience • Water quality & wastewater treatment • Air quality • Climate change Key Remaining Concerns 17 Flood Risk • Complete 3-day peak flow bypass • Increase river-floodplain connection • Adaptive management to address channel constriction Key Remaining Concerns 18 Ecosystem Impacts • Complete 3-day bypass • Conveyance refinement as soon as NISP impacts the river • Better defined, flow-based adaptive management • Increased funding for channel improvements Key Remaining Concerns 19 Water Quality & Wastewater Treatment • Additional study & data • Conveyance refinement at start-up • Adaptive management - third-party monitoring Key Remaining Concerns 20 Other • Long-term groundwater monitoring • Increase mitigation funding • Adaptive management improvements Constraints 21 • Limited influence in permitting process Comments unlikely to significantly alter NISP • NISP likely to receive permits Recent examples: Windy Gap, Moffat • Mitigation unlikely to change in permitting State approval received Risk Assessment 22 Likelihood of achieving or influencing outcomes Do nothing Oppose NISP Comment Negotiate Best Alternative to a Negotiated Outcome Staff Recommendation 23 1. Participate in public process • Technical comments on Final EIS & other permits • Advocate accurate assessment of impacts 2. Seek to negotiate • Goal - meet mutual interests • May improve status quo • Will entail tradeoffs • No guarantee of success 24 Discussion -1- RESOLUTION 2018-053 OF THE COUNCIL OF THE CITY OF FORT COLLINS DIRECTING THE CITY MANAGER OR HIS DESIGNEES TO MEET WITH THE NORTHERN COLORADO WATER CONSERVANCY DISTRICT TO NEGOTIATE A POTENTIAL AGREEMENT REGARDING THE NORTHERN INTEGRATED SUPPLY PROJECT WHEREAS, since at least 2001, the Northern Colorado Water Conservancy District (“Northern Water”) has been pursuing various forms and iterations of the Northern Integrated Supply Project (“NISP”), a water storage and supply project that would divert significant amounts of water from the Cache la Poudre River upstream of Fort Collins; and WHEREAS, Northern Water requires various governmental permits and approvals to construct NISP, including: a permit under Section 404 of the federal Clean Water Act; a State water quality certification under Section 401 of the federal Clean Water Act and applicable State of Colorado (“State”) statutes and regulations; and a “1041” permit (or agreement in lieu thereof) under Chapter 14 of the Larimer County Land Use Code; and WHEREAS, since NISP’s inception, the City has been concerned about the potentially significant impacts that NISP would have on the City and the Fort Collins community; and WHEREAS, the City has historically participated in numerous and varied discussions with Northern Water related to NISP, both in the context of the various required governmental permits and approvals and otherwise; and WHEREAS, the City submitted comments on two occasions in the federal permitting process for NISP, which is being managed by the U.S. Army Corps of Engineers as the permitting agency under the federal Clean Water Act and National Environmental Policy Act, first pursuant to Resolution 2008-082 and then pursuant to Resolution 2015-082, both as described below; and WHEREAS, pursuant to Resolution 2008-082, the City submitted comments on the draft environmental impact statement (“DEIS”) for NISP, which Resolution states, among other things, that “the City Council opposes NISP as it is described and proposed in the DEIS and also opposes any variant of NISP that does not address the City’s fundamental concerns about the quality of its water supply and the effects on the Cache la Poudre River through the City, which are critical to the City’s quality of life, health, and economic development and environment”; and WHEREAS, pursuant to Resolution 2015-082, the City submitted comments on the supplemental draft environmental impact statement (“SDEIS”) for NISP, which Resolution states, among other things, that “the City Council cannot support NISP as it is currently described and proposed in the SDEIS, with the understanding that City Council may reach a different conclusion with respect to a future variant of NISP, such as the proposed Modified Alternative Number 4 as described in the City’s comments, if such variant addresses the City’s -2- fundamental concerns expressed in the City’s comments to the DEIS and comments to the SDEIS” and WHEREAS, pursuant to Resolution 2017-024, City Council authorized and directed the City Manager or his designees “to meet on a regular basis with the Northern Water regarding NISP and to discuss and explore the City’s concerns and interests in order to ascertain whether those interests can be met, including through potential solutions to address the City’s goals and issues related to NISP”; and WHEREAS, pursuant to Resolution 2017-073, the City submitted comments and provided testimony in a State process under Section 37-60-122.2 of the Colorado Revised Statutes, by which Northern Water sought and subsequently received State approval of a plan to mitigate NISP’s impacts on fish and wildlife resources; and WHEREAS, the City’s discussions, meetings, and formal comments and participation in the permitting processes (as well as the participation of others) have resulted in some—but not all—of the City’s concerns regarding the significant impacts that NISP would have on the City and the Fort Collins community being addressed, including: • the removal of a proposed pipeline from Glade Reservoir to Horsetooth Reservoir; • the removal of exchanges through the Colorado-Big Thompson Project system; • the “conveyance refinement” that will deliver NISP water in the Cache la Poudre River through a portion of Fort Collins; • the inclusion of a multi-level outlet tower and the aeration of releases from Glade Reservoir; • the addition of water quality monitoring; additional monitoring of the Trichloroethylene plume near the Glade Reservoir forebay; • the Peak Flow Operations Plan; proposed wetland mitigation and improvements; • the stream channel and habitat improvement plan; • the proposed alterations to certain diversion structures in the Cache la Poudre River; • the plan to conserve lands near Glade Reservoir for terrestrial wildlife and for fencing and underpass construction along Highway 287; • certain best management practices to address some air pollution concerns; and • the completion of various additional studies; and WHEREAS, despite the above improvements to NISP, and other improvements that have been made to NISP over time, and following the City’s discussions, meetings, and formal comments and participation in the permitting processes, the City still has significant concerns regarding the impacts that NISP would have on the City and the Fort Collins community, including those related to base flows, peak flows (also known as “flushing flows”), ecological impacts, flooding impacts, the mitigation of impacts, mitigation funding, and other matters; and WHEREAS, the various permitting processes are proceeding towards their conclusions and the City will have limited opportunities moving forward to influence NISP through formal participation in those processes; and -3- WHEREAS, the City and Northern Water have a multi-facetted relationship, including various roles with respect to the Colorado-Big Thompson Project and the Windy Gap Project; their roles as water users on the Cache la Poudre River that are concerned with matters of water quality and quantity; and their mutual involvement in other water-related endeavors, matters, and projects; and WHEREAS, the City wishes to express its support for other communities, including participants in NISP, in their quest to acquire reliable water supplies without significantly adversely affecting other communities and the environment; and WHEREAS, it will be to the benefit of the City to have designated staff members meet with Northern Water to seek to engage in negotiations regarding NISP, and if Northern Water is so willing, to engage in negotiations regarding NISP; and WHEREAS, nothing herein is intended to affect the City’s position regarding NISP, as described in Resolution 2015-082, Resolution 2017-024, and Resolution 2017-073, and as may be modified in the future; and WHEREAS, such meetings, discussions, and negotiations with Northern Water regarding NISP will not change the City’s position regarding NISP, as described in Resolution 2015-082, Resolution 2017-024, and Resolution 2017-073, and will not bind the City without subsequent action from City Council. NOW THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. Section 2. That the City Manager is hereby authorized and directed to meet with Northern Water to seek to negotiate regarding NISP, and if Northern Water is so willing, to engage in negotiations regarding NISP. The City Manager in his discretion may designate certain qualified staff members for such discussions and negotiations. Section 3. That in negotiating with Northern Water regarding NISP, the City Manager and his designees shall focus on the following key goals and issues, which are listed in no particular order: (a) A reduction of source water quality and other adverse impacts to the City’s water supplies that are used by the City to meet treated and untreated water demands; (b) A reduction of water quality and other adverse impacts to the City’s wastewater treatment facilities; (c) A reduction of adverse impacts to the river health and ecology of the Cache la Poudre River and associated biological resources, including riparian vegetation and wetlands, aquatic habitat and life, and terrestrial wildlife, from the point of diversion for NISP to the location where the river crosses Interstate 25; -4- (d) A reduction of adverse impacts to the ability of the Cache la Poudre River to adequately convey storm and flood waters; (e) A reduction of NISP’s diminishment of “peak flows” in the Cache la Poudre River from the point of diversion for NISP to the location where the river crosses Interstate 25. (f) A reduction of adverse impacts to the aesthetic, recreational, and socioeconomic attributes of the Cache la Poudre River from the point of diversion for NISP to the location where the river crosses Interstate 25; and (g) A reduction of adverse impacts to air quality. Section 4. That in such negotiations, the City Manager and his designees shall be guided by the concerns that are more fully expressed in the comments provided pursuant to Resolution 2008-082, Resolution 2015-082, Resolution 2017-024, and Resolution 2017-073, in addition to such other information and investigations that are prudent and further the purposes of this Resolution. Section 5. That the City Manager and his designees shall report back to City Council regarding such discussions at regular intervals. Passed and adopted at a special meeting of the Council of the City of Fort Collins this 29th day of May, A.D. 2018. _________________________________ Mayor ATTEST: _____________________________ City Clerk Adaptive management should be well funded and include clear performance standards • Add performance standards or postpose mitigation plan approval until standards/triggers are defined • Independent monitoring • Increase annual budget to $100,000 • Performance standards and triggers not defined • Flows will not be used in adaptive management • Pledge $50,000 annually for 20 years beyond build-out • Advocate for local science and monitoring efforts, performance standards (near-term) • Help to identify and develop sustainable funding for mitigation beyond 20-years (long- term) Mitigation/ Funding Mitigation/enhancement funds should match the scope of NISP’s impacts • Provide $77.2M for mitigation and enhancement • Take a functions based, long term approach to restoration for loss of function • $59M for mitigation and enhancement • Certain short-term/small scale approaches proposed for mitigation/restoration (e.g., dredging). • Allocate new funding to the Natural Areas budget to conduct targeted mitigation in riparian corridor that is not done by project • Leverage volunteer resources to help with these activities as appropriate Big Game Habitat Construction of Glade Reservoir will impact big game habitat near the City’s Gateway Natural Area. • Partner with City to conserve 5,000 acres near Glade Reservoir • Increases commitment to conserve lands near Glade • Consents to GOCO easement requirements • None 1Taken from the City’s comments on NISP’s Draft Fish and Wildlife Mitigation and Enhancement Plan (FWMEP), and the City’s September 1, 2017 letter to Colorado Parks and Wildlife Commission responding to revisions to the FWMEP 2Taken from the NISP’s final approved FWMEP • Peak Flow Operations Plan is insufficient, particularly by omitting peak flows following drought years • Even with Peak Flows Plan, channel constriction anticipated, leading to increasing flood risks • Peak flows during initial fill period should be provided Water Resources • Hydrologic modeling is insufficient • No ability to protect mitigation releases and bypasses from downstream diverters • Created Common Technical Platform to cooperatively address flow modeling • Senate Bill 18-170 now protects mitigation flows • N/A Corps shows TCE plume degrading and decreasing • Long-term TCE monitoring is needed Environmental Issues Riparian Vegetation and Wetlands • Reduced river flows will cause narrowing of riparian corridor and loss of ecosystem services (e.g. pollution filtration) • Inappropriate study data and methods • Peak Flow Operations Plan lessens concerns • Wetland mitigation planned • 10 acres of riparian vegetation improvements in Fort Collins • $1M for stream channel and habitat improvement plan • Additional study provided • Peak Flow Operations Plan is insufficient • Longer duration peak flows needed to maintain wetlands and riparian areas • Insufficient funding of stream channel and habitat improvements 1 Abbreviated from City comments on the 2008 NISP Draft EIS, the 2015 NISP Supplemental Draft EIS, and the 2017 NISP Mitigation Plan. 2 Listed mitigation measures are not exhaustive and specific to Fort Collins’ interests. Additional mitigation will be provided through NISP’s proposed Poudre River Adaptive Management Program. ATTACHMENT 1