Court Decision Strengthens Water Security Across the Inland Empire

Ruling Finds Inland Empire Utilities Agency Undermined Decades-Old Water Agreements

ONTARIO, Calif., May 28, 2025 /PRNewswire/ -- The City of Ontario welcomes the recent State of California Fourth Appellate District Division Two court decision reversing Chino Basin Watermaster's application of the IEUA-led 2019 Letter Agreement in relation to the Dry-Year Yield (DYY) Program. This ruling affirms Ontario's position that the Chino Basin Watermaster's approval of the Fiscal Year 2021/2022 and 2022/2023 Assessment Packages were inconsistent with the core agreements, judicial orders, and performance criteria governing the DYY Program in the Chino groundwater basin.

"Ontario has always supported regional water solutions, but we will not allow our residents to be penalized for following the rules while others seek shortcuts," said City Councilmember Debra Porada. "IEUA's actions, in coordination with Watermaster and others, deviated from decades of cooperation and transparency, and we're pleased the court has recognized the importance of upholding both the law and the trust between agencies."

Increased water assessments can lead to higher utility costs and place an unfair financial burden on the community. Ensuring fair implementation of water storage and recovery agreements helps protect ratepayers from being penalized for adhering to rules while others benefit from exceptions. The court's ruling safeguards Ontario residents by reaffirming the principle that all parties must follow the same standards to ensure affordability and reliability in local water service.

The DYY Program, launched nearly two decades ago, was designed as a conjunctive use strategy to bolster regional water supply reliability by storing water in wet years and recovering it in dry years to offset imported water demand. Governed by Court orders and agreements, including the 2000 Peace Agreement, the 2003 DYY Funding Agreement, the 2004 DYY Storage and Recovery Agreement, and related Local Agency Agreements, the DYY Program ensures a coordinated and equitable approach among eight designated "Operating Parties," including the City of Ontario.

However, this balance was disrupted when the Inland Empire Utilities Agency (IEUA), along with the Metropolitan Water District, pushed for operational changes through the 2019 Letter Agreement that circumvented the original intent and structure of the DYY Program. Under IEUA's leadership on the DYY Program Operating Committee, with support from Watermaster, unauthorized voluntary withdrawals were allowed, benefiting two agencies that produced the water, without proper performance commitments or court-approved agreements. Watermaster and IEUA downplayed these significant changes as mere "operational flexibility," but the appellate court decisively rejected that argument, finding the changes materially affected the rights of other agencies, including Ontario.

By supporting the exemption of these voluntary withdrawals from financial assessments, actions by Watermaster and IEUA led directly to Ontario and other compliant agencies being unfairly burdened with increased water costs. This maneuvering not only violated the terms of the court-adopted agreements but also broke with more than two decades of collaborative governance. Despite Ontario's early warnings and calls for transparency, Watermaster and IEUA proceeded with changes that undermined the integrity of the program and the legal structure that protects all participating communities.

With this hard-won appeal, prior implementation of the IEUA-led 2019 Letter Agreement is reversed to protect the integrity of the DYY Program. Watermaster is made to amend and reissue annual assessment packages fairly, sparing the Inland Empire from losing the originally envisioned broad mutual benefits of the program and the inequitable shifting of million-dollar consequences to agencies like Ontario. The City of Ontario remains committed to regional collaboration based on fairness, transparency, and legal compliance, and will continue to advocate for its residents and ratepayers in all matters affecting local water management.

Learn more at www.ontarioca.gov/government/municipal-utilities-company.

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SOURCE City of Ontario