The Sheep Creek Mutual Water Company, The Phelan Pinon Hills Community Services District, The State Water Resources Control Board and the State Water Board’s Division of Financial Assistance have been working towards a consolidation agreement between Sheep Creek and the PPHCSD in an effort to comply with a source capacity compliance order issued by the Water Board on August 30, 2018.  At a recent Town Hall Meeting was held on July 23,  to update the public on the progress of the negotiations.

Both water districts have been developing a consolidation agreement that would be presented to each districts’ board for approval, and the Sheep Creek shareholders for approval.

Most of the details have been worked out with the exception of the transfer of water rights from Sheep Creek to the PPHCSD.  The Division of Financial Assistance is expected to reach a decision on the funding for such a transfer within the next 1-2 months.  Sheep Creek Water has said that if the State can fund the purchase of the water rights then the consolidation would move forward with a formal agreement.  If funding is not available then the company will move forward in self-funding the construction of the additional wells that are needed to comply with the source capacity compliance order.  This cost would fall upon the Sheep Creek Water shareholders.

If the consolidation project moves forward it would take the state 9-12 months to review the project, approve the project, establish a funding agreement and initiate construction.  Additionally, it is estimated that another 6-12 months would be needed to complete the construction of the water system infrastructure for the consolidation with PPHCSD.

The compliance order which resulted in a service connection moratorium was imposed because Sheep Creek was unable to meet it’s maximum daily demand, which is determined by the largest amount of water used in one day over a 10 year period.  In order to comply, additional wells would need to be installed to increase the amount of water needed to meet the compliance order or the company would need to consolidate with The PPHCSD.  A feasibility study conducted as a result of the compliance order identified other non-source capacity deficiencies that would need to be addressed once the company has complied with the order.  Sheep Creek water continues to meet the standards set by the State regarding the quality of drinking water provided to its users per their most recent water quality report submitted to the State.