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Metropolitan Water District of Southern California 1
Los Angeles 3rd Regional Investors Conference
Los Angeles, California
March 31, 2016
Metropolitan Water District of Southern California 2 Metropolitan Water District of Southern California 2
Metropolitan Water District of Southern California 3 Metropolitan Water District of Southern California 3
Metropolitan Water District of Southern California 4
– 26 Members Agencies – 5,200 square miles – 19 million people – $1 trillion regional economy – 4 million acre-foot average water
demand
Local Supplies
Imported Supplies
Metropolitan Water District of Southern California 5
MWD Service Area
Lake Powell
Lake Mead
Upper Colorado
River Basin
Colorado River
Colorado River Aqueduct
• Aqueduct Capacity: 1.25 MAF
• 242 miles of aqueduct
• 5 Pumping Plants
• 4 Reservoirs
Historic Range of Deliveries:
0.45 – 1.28 MAF
Metropolitan Water District of Southern California 6
MWD Service Area
San Luis Reservoir
Bay- Delta
Sacramento & Feather Rivers
California Aqueduct
Lake Oroville
Northern Sierra
• Total Contract: 4.2 MAF
• MWD is largest contractor (~2.0 MAF)
• 29 Contractors • 28 Dams • 26 Pumping &
Generating Plants • 660 Miles of
Aqueduct
Historic Range to MWD:
0.4 – 1.8 MAF
Metropolitan Water District of Southern California 7
Local Storage Diamond Valley Lake Mathews Lake Skinner Conjunctive Use Groundwater DWR State Project Reservoirs
Central Valley/SWP Storage San Luis Carryover Semitropic Arvin-Edison Kern Delta Mojave CRA Storage
DWCV Advance Delivery Lake Mead
ICS
Metropolitan Water District of Southern California 8
0.0
1.0
2.0
3.0
4.0
5.0
6.0
Mill
ion
Acre
-Fee
t
14x Increase in Capacity
Metropolitan Water District of Southern California 9 Metropolitan Water District of Southern California 9
Metropolitan Water District of Southern California 10
Water Year to Date
0
5
10
15
20
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Wat
er C
onte
nt (i
n.)
Normal
Current Water Year
97-98 El Nino
Previous Water Year
14.2 in. Current:
Metropolitan Water District of Southern California 11
Normal
Current Water Year
97-98 El Nino
Previous Water Year
Water Year to Date
0
5
10
15
20
25
30
35
40
45
50
55
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Wat
er C
onte
nt (i
n.)
` 28.2 in. Current:
Metropolitan Water District of Southern California 12
8 - Station
0
10
20
30
40
50
60
70
80
90
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Prec
ipita
tion
(in.)
Water Year to Date
Last Year: 37.2 in.
Driest
Wettest 88.5 in.
Average
97-98 El Nino: 82.4 in.
17.1 in.
50.0 in.
51.8 in. Current:
Metropolitan Water District of Southern California 13 0.0
0.5
1.0
1.5
2.0
Mill
ion
Acre
-Fee
t
0.96 CRA
0.96 Table A
0.10 T/E
1.7 MAF
50% SWP Allocation
Metropolitan Water District of Southern California 14
2.2 1.8 1.1 1.0
1.7 2.4 2.7 2.3
1.2
0
1
2
3
4
5
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Mill
ion
Acre
-Fee
t
Emergency Storage Dry-Year Storage
End of Year Balances
0.9
1.2
Metropolitan Water District of Southern California 15
Metropolitan Water District of Southern California 16
Protects State’s water supplies through Delta system upgrades Mitigation
Includes ~ 15,600 acres of habitat
Water contractor funded Dual tunnel facilities and mitigation
Supports long-term health of native fish & wildlife Habitat restoration
~ 30,000 acres in 5 years Includes broader public funding
16
Metropolitan Water District of Southern California 17 17
Tunnels
SWP Pumps CVP Pumps
Design modifications
Construction impacts
Water quality
Regulatory process
Metropolitan Water District of Southern California 18
IMPROVEMENTS Capital O&M (Total 50 Years)
TOTAL
Conveyance $14.99 B $1.46 B $16.45 B
Mitigation, Monitoring $0.56 to $0.82 B $0.22 B $0.78 to $1.04 B
TOTAL $15.55 to $15.81 billion
$1.68 billion
$17.23 to $17.49 billion
Estimated costs from DWR; in undiscounted 2014 dollars with a 36% contingency Metropolitan’s share is approximately 25%
Revised Cost Analysis
Within $5 per household per month
Metropolitan Water District of Southern California 19
DWR tracking amount of water that could have been diverted from the Delta and stored this winter if California WaterFix were in place
January 5-31 290,000 AF February 1-5 89,000 AF February 6-11 64,000 AF February 12-18 14,000 AF February 19-25 23,000 AF
Total 480,000 AF
• Equivalent to 156 billion gallons of water • Enough water to serve 3.5 million
people for one year
Metropolitan Water District of Southern California 20
Metropolitan Water District of Southern California 21
Nearly a decade of discussions on water recycling
November 2015 Metropolitan’s Board appropriated $15M for “Demonstration Project”
Advanced Water Treatment Demonstration Plant (1 MGD) On site-District’s Joint Water Pollution Control Plant
December 2016 Report findings to MWD Board
Feasibility Studies and Financing Plan Indirect potable reuse program through phased approach to up to 150 MGD
Metropolitan Water District of Southern California 22
● Diversify regional supplies
● Improve storage and delivery capabilities
● Provide new source of high quality, drought-resistant water
● Increase overall reuse within its system
● Begin beneficial reuse at the Joint Water Pollution Control Plant
● Reduce ocean discharges
Metropolitan Water District of Southern California
Metropolitan Water District of Southern California 23
Metropolitan Water District of Southern California 24
Fixed $3.2 billion
Variable $530 million
Synthetic Fixed
$494 million
$4.2 Billion
76%
12% 13%
Metropolitan Water District of Southern California 25
$1.0 Billion
Four series: Three Year
Reset March 2018
Self-Liquidity Weekly VRDO’s
$340M $89M
Bank Liquidity Weekly VRDO’s $62M
$338M
Bank Liquidity Daily VRDO’s
SIFMA Index Bonds
$198M Four series:
270 Day Reset Aug.-Sept. 2016
Three series
Available $180M bank
liquidity
Metropolitan Water District of Southern California 26
Adopted by Metropolitan’s Board on March 8, 2016 Increase flexibility to issue new debt structures Expect to initially use for short-term debt Allow for a “hard put” structure
Failure to pay on the put date is an event of default Plan to keep current senior lien open
Metropolitan Water District of Southern California 27
SIFMA Note Remarketing’s may utilize new Master Subordinate Resolution
$129M - 2011 Ser. A1/A3 (270 Days): August 2016 $104M – 2009 Ser. A (270 Days): August 2016 $105M – 2013 Ser. E (270 Days): September 2015
Current Refunding Opportunities-July 1, 2016
$175M 2005 Auth. Ser. C $ 24M - 2006 Ser. B $30M 2012 Ser. E3 and $15M 2015 Ser. G1
Metropolitan Water District of Southern California 28
AAA/AA+/Aa1 ratings Financials impacted by lower water sales Revenue Bond Debt Service coverage = 2.0X goal
Projected FY 2016: 1.40x Fixed Charge coverage = 1.2X goal
Projected FY 2016: 1.25X FY 2015/16: Unrestricted reserves anticipated to be approximately $400 million by end of fiscal year
Metropolitan Water District of Southern California 29
Essential service provider to large & diversified regional area
Vast service territory covering six counties and 19 million people
Diversified water supply and large water storage reserves to address drought conditions
Began 2016 with total water storage of approximately 1.5 MAF
CRA Supplies expected to be approximately 960 KAF for 2016
SWP current allocation at 30%
Strong financial profile Trend of sound debt service coverage Conservative water sales projections Reasonable and predictable water rate increases Over $1 billion in cash and investments