Staff Report for the Regular Meeting of the Board of Directors, November 12, 2014

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1 Nevada Irrigation District Staff Report for the Regular Meeting of the Board of Directors, November 12, 2014 TO: FROM: Board Members Timothy A. Crough, Assistant GM DATE: 11/4/2014 SUBJECT: Mercury and Sediment Removal at Combie and Rollins Reservoirs, and CABY IRWM Grant for Mercury Abatement Technical Assistance by the United States Geologic Surveys ADMINISTRATION RECOMMENDED ACTION: Approve the agreement for technical assistance by the United States Geologic Surveys for Mercury and Sediment Removal at Combie and Rollins Reservoirs, and Mercury Abatement at Malakoff Diggins, as recommended by the Administrative Practices Committee, and authorize the General Manager to execute the agreement. BACKGROUND: In 2013, the District authorized a grant application for the 2013 Integrated Regional Water Management (IRWM) Proposition 84, Round 2 Implementation Grant. The Sierra Fund (TSF) submitted the application on behalf of participating members of the Cosumnes, American, Bear, and Yuba River IRWM Planning Group (CABY). Earlier this year, the CABY IRWM was awarded a grant in the amount of $5.5 Million for several distinct projects, two of which include the District s participation: 1) Project 4 - a Water Supply, Water Efficiency, and Supply Reliability Project with Placer County Water Agency, and 2) Project 6 - a Mercury and Sediment Abatement Initiative with The Sierra Fund refer to another item on the Committee s agenda. For Project 6, the District will subcontract with the United States Geologic Surveys (USGS) to provide technical assistance for the Combie Reservoir Mercury Removal demonstrations, and provide sampling, testing and scientific expertise, - 1 -

2 including Land-based LiDar Data to The Sierra Fund, for its work at Malakoff Diggins. In addition, the District is currently evaluating ways to remove sediment and mercury from Rollins Reservoir at Greenhorn Creek. The attached scope of work was prepared by the USGS to address all three projects. A draft agreement for the work was drafted by the USGS - see attached Agreement and Scope of Work. On 10/7/2014, the Administrative Practices Committee approved a Budget Amendment for the District s portion of Project 6; this included the portion to be done by the USGS that is scheduled to begin later in November On 11/4/2014, the APC reviewed the USGS Scope of Work and discussed the agreement in brief. The APC recommended approval of the agreement by the Board of Directors, subject to final approval by District Counsel. BUDGETARY IMPACT: The total direct expenses for Project 6 are estimated at $546,390. These expenses are included in the recent 2014 Budget Amendment by the APC. Additionally, the USGS will be required to document a Cost Share of $28,500 (representing other project related expenses by the USGS related to its Land-based LiDar). Therefore, all of the expenses for the USGS portion of Project 6 should be reimbursed by the grant. tac attachments(3): Draft USGS Letter Scope of Work USGS Agreement - 2 -

3 California Water Science Center 6000 J Street, Placer Hall California State University Sacramento, California Phone: (916) Fax: (916) Mr. Tim Crough Nevada Irrigation District 1036 West Main Street Grass Valley, California Draft Dear Mr. Crough; This letter confirms discussions between our respective staffs, concerning the Technical Support for Three Sediment Projects: Combie Reservoir, Greenhorn Creek, and Malakoff Diggins, between the Nevada Irrigation District (NID) and the U.S. Geological Survey (USGS) during the period November 1, 2014, to July 31, Fiscal Year NID USGS Total 2015 $89,500 $24,000 $113, $30,500 $8,000 $38, $0 0 $0 Total $120,000 $32,000 $152,000 Enclosed, are three originals of Joint Funding Agreement (JFA), 15WSCA , for your approval. Work performed with funds from this agreement will be conducted on a fixed-price basis. If you are in agreement with this proposed program, please return two signed JFA s to our office. The third JFA is for your records, pending USGS approval. Upon approval, a fully executed JFA will be forwarded for your records. The USGS is required to have an agreement in place prior to any work being performed on a project. Please return the signed JFA by November 19, 2014 to avoid any disruption in the program.

4 If you have any questions concerning the program described above, please contact Charles Aplers ), in our Sacramento Project Office. If you have any administrative questions, please contact Janee Hiett, in our Sacramento Office ). Sincerely, Eric G. Reichard, Director, USGS California Water Science Center Enclosures cc: Charles Alpers, USGS CAWSC

5 SCOPE OF WORK Term of Technical Assistance: November 1, 2014 through July 31, 2017 Summary: The purpose of this agreement is to reimburse the U.S. Geological Survey (USGS) for work on three separate projects: 1) The Combie Reservoir Sediment and Mercury Extraction Project, 2) The Greenhorn Creek Project, and 3) Land-based LiDAR at Malakoff Diggins Pit. The second of these projects is funded directly by NID, whereas the first and third projects are funded by the Department of Water Resources (DWR) through a grant from its Integrated Regional Watershed Management Program (IRWMP). The IRWMP grant is part of a block grant for the Cosumnes American Bear Yuba (CABY) area that is being administered by the Sierra Fund. NID will reimburse the USGS for the time, travel, and other expenses incurred by participation of a USGS scientist (Dr. Charles N. Alpers) in the technical review of documents to be prepared by NID and its contractors in relation to the Combie Reservoir and Greenhorn Creek projects, and for work related to land-based LiDAR, plus mineralogical and geochemical characterization of sediment by USGS staff on the Malakoff Diggins project. Task 1. Combie Reservoir Sediment and Mercury Extraction Project Background: Dredging to maintain water storage capacity has occurred at Combie Reservoir and the Bear River over the past 40 years on an as needed basis. Operations were halted by the Central Valley Regional Water Quality Control Board (CVRWQCB) in 2002 due to elevated mercury levels. As a result, Combie Reservoir has been filling in with sediment with each storm event. The project includes three major features. First, involves the dredging of upper Combie Reservoir to maintain water storage capacity; second, involves the mercury removal and separation process using a Knelson concentrator and dewatering of the dredge material using mobile on-shore equipment; and finally, involves the transport of sand and aggregate byproducts to the Chevreaux Aggregates, Inc. processing plant to the northeast of the Project site, or similar plant in Nevada County or Placer County. This project is intended to be an ongoing reservoir maintenance activity. The initial part will be conducted over a three- to five-year period and will remove approximately 150,000 to 200,000 tons of sediments that have been deposited in the upper Combie Reservoir. On a long term basis there is a public necessity to remove sediments from Combie Reservoir in order to restore and maintain water capacity while improving water quality by addressing legacy mercury contamination within the reservoir. Should NID be unable to regularly maintain its reservoir capacity, in time, it would fill up with sediments, gravels and sands from upstream sources, thereby reducing water storage capacity, power production opportunities and recreational use including fishing and hunting. An Anti-Degradation Study was conducted by NID at the request of the CVRWQCB to determine that standards for mercury are met. The Anti-Degradation Study included sampling water quality in the Bear River both upstream and downstream of Combie Reservoir, and evaluation of mercury removal efficiency in pilot tests with the Knelson Concentrator on sediments from Combie Reservoir.

6 Additional equipment demonstration tests will be conducted during 2014 to ensure that water quality standards will be met during dredging operations. Activities and deliverables: A USGS Research Chemist (Dr. Charles N. Alpers) will attend meetings, review sampling plans and be present at the field site during the equipment demonstration tests, as needed. The USGS will provide comments on the scientific information presented in documents prepared by NID and its contractors relative to published information in the scientific literature. Budget: Funds-in of approximately $10,000 are being provided by the Nevada Irrigation District (NID) to cover the costs of review and report services of Dr. Charles N. Alpers (GS-14 Research Chemist) plus anticipated costs of travel and incidental expenses. This will be a costreimbursable project. Table 1 shows the details for the overall project budget for Task 1, by management category. Table 1. Budget for Task 1, by management category Labor $ 10,325. Vehicles $ 1,177. Supplies and Shipping $ 726. Communications and Equipment $ 272. Total $ 12,500. Table 2 shows the breakdown of funding sources for Task 1 Table 2. Funding sources for Task 1 NID $ 10,000. USGS (Federal Matching Funds) $ 2,500. Total $ 12,500. Schedule: USGS review comments on NID documents from the equipment tests should be available within 21 days of receipt of the documents by the USGS.

7 Task 2. Greenhorn Creek Project Background: Greenhorn Creek contains abundant sediment that consists largely of debris from historical hydraulic mining operations. Ongoing transport of sediment in Greenhorn Creek is deposited in Rollins Reservoir, which is operated by NID. To maintain storage capacity in Rollins Reservoir, NID is planning to dredge sediment from the Greenhorn Creek Arm of the reservoir. Previous work by the USGS ( ) and by NID ( ) has shown that sediment transported in Greenhorn Creek and occurring in the streambed has elevated concentrations of mercury and methylmercury. Additional sampling of Greenhorn Creek water quality and sediment chemistry is needed over a range of hydrologic conditions to provide information needed for planning future sediment removal activity in either wet, dry, or semi-dry conditions. Activities and deliverables: A USGS Research Chemist (Dr. Charles N. Alpers) will attend meetings, review sampling plans, and conduct field visits, as needed. The USGS will provide comments on the scientific information presented in documents prepared by NID and its contractors relative to published information in the scientific literature. Budget: Funds-in of approximately $10,000 are being provided by the Nevada Irrigation District (NID) to cover the costs of review and report services of Dr. Charles N. Alpers (GS-14 Research Chemist) plus anticipated costs of travel and incidental expenses. This will be a costreimbursable project. Table 3 shows the details for the overall budget for Task 2, by management category. Table 3. Budget for Task 2, by management category Labor $ 10,325. Vehicles $ 1,177. Supplies and Shipping $ 726. Communications and Equipment $ 272. Total $ 12,500. Table 4 shows the breakdown of funding sources for Task 2 Table 4. Funding sources for Task 2 NID $ 10,000. USGS (Federal Matching Funds) $ 2,500. Total $ 12,500. Schedule: USGS review comments on NID documents related to sampling of water and sediment in Greenhorn Creek should be available within 21 days of receipt of the documents by the USGS.

8 Task 3. Land-based LiDAR at Malakoff Diggins Pit Background: Malakoff Diggins, once the largest hydraulic mine in the Sierra Nevada and now a State Historic Park, represents a major source of sediment and mercury to the Humbug Creek and South Yuba River watersheds. The abandoned hydraulic mine pit at Malakoff Diggins is estimated to be 3000 ft long, 1000 ft wide and up to 600 ft deep in places. The Malakoff Diggins pit exhibits extreme badland topography and continues to erode massive amounts of sediment contaminated with mercury during storm events. Sediment from the exposed and eroding mine workings, along with mercury, is mobilized by heavy rainfall and seasonally impacts the South Yuba River, a State designated and federally nominated Wild and Scenic River. Humbug Creek itself is listed under Section 303(d) of the Clean Water Act as impaired for sediment, mercury, copper and zinc. A three-year grant from the California Sierra Nevada Conservancy and supplemental grants from Bella Vista Foundation and the Rose Foundation have funded The Sierra Fund to complete an assessment of the Humbug Creek watershed starting in Partners in this collaborative assessment effort include California State Parks, California State University Chico (CSUC), and the South Yuba River Citizens League. This work has included: (1) review and compilation of historical documents and previous studies including extensive work by State Parks in the 1970s and 80s to identify sediment sources; (2) establishment of a Working Group of technical advisors to the project including State Parks, the U.S. Forest Service and the Bureau of Land Management (federal landowners neighboring the project), USGS, CSUC, CSU Sonoma, and others, and (3) original research over two field seasons to quantify water quality impairment and identify sources of mercury in the watershed. An IRWMP grant from DWR as part of the CABY block grant addresses several follow-up tasks at Malakoff Diggins pit and the Humbug Creek watershed. The IRWMP grant is being managed by the Sierra Fund, which will reimburse NID for costs incurred by USGS for this part of the project. The goals of the overall project are to identify, quantify, and trace sources of sediment in the hydraulic mining pit (the pit), which will directly lead to developing effective sediment and mercury abatement techniques that can be used at this site. Specific activities include identification of erosional rates of specific land form processes using land-based (terrestrial) Light Direction and Ranging (t-lidar), to be done by the USGS, and development of a comprehensive sediment budget by measuring deposition in and discharge loads from the pit (to be done by the Sierra Fund), to facilitate development of effective sediment and mercury abatement techniques for Malakoff Diggins.

9 Activities and Deliverables: Task 3.1. Land-based LiDAR to measure erosion rates of geologic units in Malakoff Diggins pit The USGS will make land-based LiDAR measurements at two or more hill-slope locations within the Malakoff Diggins pit. LiDAR measurements will be taken at each location on three or more different dates, including annual surveys over a 24-month time span. In addition, measurements will be made after a large rain event, if conditions and funding permits. The total number of datasets will be six or more (two locations on three or more dates). The data will be analyzed to quantify erosion quantity and rate. The data will be interpreted to infer transport processes within the pit. Based on geologic mapping and air-photo interpretation in the pit, the LiDAR results from the three discrete hill slope locations will be applied to other areas in the pit to estimate erosion rates over a larger area. The results from Task 3.1 will be provided to NID and the Sierra Fund in mutually agreed-upon format so that the Sierra Fund can incorporate the information into its report on sediment budgets. It is anticipated that a journal article will be written, in collaboration with the Sierra Fund, addressing the modern-day sediment budget for the pit. However, the journal article is not a required deliverable product under this agreement. Task 3.2. Collection and analysis of sediment samples Sediment samples from the Malakoff Diggins pit will be processed for grain-size distribution (GSD) by Coulter counter, mineralogy by x-ray diffraction (XRD), major elements by x-ray fluorescence (XRF), and (or) trace elements by inductively coupled plasma (ICP) using existing available equipment. The total number of samples to be analyzed will be determined by budgets and availability of volunteers but will include at least 9 in situ samples from hill slopes, 9 in situ samples from other source areas such as the pit floor, and 7 samples of suspended sediment from the Hiller Tunnel discharge and various locations on the pit floor. The minimum total number of sediment samples to be collected and analyzed is 25. All samples will be processed for GSD and XRD; additional analyses (XRF and ICP) are to be determined based on remaining funds and equipment availability. The results from Task 3.2 will be provided, as soon as available, to NID and the Sierra Fund. Methods and data will be documented in a mutually agreed upon format that the Sierra Fund can use in its final report to DWR for the CABY grant. The information may also be used in the journal article referenced in Task 3.1.

10 Budget: Table 5 shows the budget for Task 3.1 by management category and federal fiscal year. Table 5. Budget for Task 3.1, by management category and federal fiscal year. FY15 FY16 FY17 Totals Labor $ 70,033 $ 30,908 $ 100,941 Vehicles $ 3,074 $ 904 $ 3,978 Travel $ 5,435 $ 1,266 $ 6,701 Supplies & Shipping $ 3,469 $ 1,204 $ 4,673 Communication & Equipment $ 3,489 $ 2,218 $ 5,707 Laboratory Total $ 85,500 $ 36,500 $ 122,000 Table 6 shows the breakdown of funding sources for Task 3.1 Table 6. Funding sources for Task 3.1, by federal fiscal year. FY15 FY16 FY17 Totals USGS Federal Matching Funds (FMF) $ 19,000 $ 8,000 $ 27,000 NID unmatched $ 47,500 $ 20,500 $ 68,000 NID matched $ 19,000 $ 8,000 $ 27,000 NID total $ 66,500 $ 28,500 $ 95,000 Total $ 85,500 $ 36,500 $ 122,000 Table 7 shows the budget for task 3.2 by management category and federal fiscal year. Table 7. Budget for Task 3.2 by management category and federal fiscal year FY15 FY16 FY17 Totals Laboratory $3,000 $2,000 $5,000 Totals $3,000 $2,000 $5,000 Table 8 shows the breakdown of funding sources for Task 3.2 Table 8. Funding sources for Task 3.2, by federal fiscal year. FY15 FY16 FY17 Totals NID $3,000 $2,000 $5,000 USGS (Federal Matching Funds) Total $3,000 $2,000 $5,000

11 Schedule: It is anticipated that terrestrial LiDAR data (Task 3.1) will be collected in fall 2014, fall 2015, and fall Preliminary results for erosion volume and rates from the first two LiDAR data collection events should be available by May 31, 2016 and will be presented to NID and the Sierra Fund in a PowerPoint presentation as part of the Mercury Forum. Final results for erosion volume and rates from all LiDAR collection events should be available by January 31, Mineralogical and chemical data (Task 3.2) from samples collected during should be available by May 31, Data from samples collected during 2016 should be available by January 31, Data tables and text describing methods and quality assurance / quality control for analyses in Tasks 3.1 and 3.2 will be completed by the USGS by February 15, 2017 and provided to NID and the Sierra Fund. It is anticipated that a journal article resulting from this research will completed in draft form by April 15, 2017 and submitted to USGS peer review and a journal at that time, although the article is not a required deliverable product of this agreement. The article will likely be published by December 31, 2017.

12 Budget Summaries for All Tasks: Tables 9 through 11 summarize funding from NID, USGS, and total funding by task and federal fiscal year. Table 9. Summary of funding from NID by task and federal fiscal year. FY15 FY16 FY17 Totals Task 1 Combie $ 10,000 $ - $ 10,000 Task 2 Greenhorn $ 10,000 $ - $ 10,000 Task 3.1 Malakoff LiDAR $ 66,500 $ 28,500 $ 95,000 Task 3.2 Malakoff Sediment Samples $ 3,000 $ 2,000 $ 5,000 Total NID Funding $ 89,500 $ 30,500 $ 120,000 Table 10. Summary of USGS Federal Matching Funds (FMF) by task and federal fiscal year. FY15 FY16 FY17 Totals Task 1 Combie $ 2,500 $ - $ 2,500 Task 2 Greenhorn $ 2,500 $ - $ 2,500 Task 3.1 Malakoff LiDAR $ 19,000 $ 8,000 $ 27,000 Task 3.2 Malakoff Sediment Samples $ - $ - $ - Total USGS Federal Matching Funds $ 24,000 $ 8,000 $ 32,000 Table 11. Summary of total funding by task and federal fiscal year. FY15 FY16 FY17 Totals Task 1 Combie $ 12,500 $ - $ 12,500 Task 2 Greenhorn $ 12,500 $ - $ 12,500 Task 3.1 Malakoff LiDAR $ 85,500 $ 36,500 $ 122,000 Task 3.2 Malakoff Sediment Samples $ 3,000 $ 2,000 $ 5,000 Totals $ 113,500 $ 38,500 $ 152,000

13 Form (Oct. 2005) Page 1 of 2 U.S. Department of the Interior U.S. Geological Survey Joint Funding Agreement FOR Water Resources Investigations Agreement #: 15WSCA Customer #: Project #: ZG009J5 TIN #: USGS DUNS #: Fixed Cost Agreement Yes X No THIS AGREEMENT is entered into as of the 1st day of November, 2014, by the U.S. GEOLOGICAL SURVEY, UNITED STATES DEPARTMENT OF THE INTERIOR, party of the first part, and the Nevada Irrigation District, party of the second part. 1. The parties hereto agree that subject to the availability of appropriations and in accordance with their respective authorities there shall be maintained in cooperation for the Technical Support for Three Sediment Projects: Combie Reservoir, Greenhorn Creek, and Malakoff Diggins, herein called the program. The USGS legal authority is 43 USC 36C; 43 USC 50, and 43 USC 50b. 2. The following amounts shall be contributed to cover all of the cost of the necessary field and analytical work directly related to this program. 2(b) include In-Kind-Services in the amount of $0.00. (a) $32, by the party of the first part during the period November 1, 2014 to July 31, 2017 (b) $120, by the party of the second part during the period November 1, 2014 to July 31, 2017 (c) Additional or reduced amounts by each party during the above period or succeeding periods as may be determined by mutual agreement and set forth in an exchange of letters between the parties. (d) The performance period may be changed by mutual agreement and set forth in an exchange of letters between the parties. 3. The costs of this program may be paid by either party in conformity with the laws and regulations respectively governing each party. 4. The field and analytical work pertaining to this program shall be under the direction of or subject to periodic review by an authorized representative of the party of the first part. 5. The areas to be included in the program shall be determined by mutual agreement between the parties hereto or their authorized representatives. The methods employed in the field and office shall be those adopted by the party of the first part to insure the required standards of accuracy subject to modification by mutual agreement 6. During the course of this program, all field and analytical work of either party pertaining to this program shall be open to the inspection of the other party, and if the work is not being carried on in a mutually satisfactory manner, either party may terminate this agreement upon 60 days written notice to the other party. 7. The original records resulting from this program will be deposited in the office of origin of those records. Upon request, copies of the original records will be provided to the office of the other party. 8. The maps, records or reports resulting from this program shall be made available to the public as promptly as possible. The maps, records or reports normally will be published by the party of the first part. However, the party of the second part reserves the right to publish the results of this program and, if already published by the party of the first part shall, upon request; be furnished by the party of the first part; at cost, impressions suitable for purposes of reproduction similar to that for which the original copy was prepared. The maps, records or reports published by either party shall contain a statement of the cooperative relations between the parties. 9. USGS will issue billings utilizing Department of the Interior Bill for Collection (form DI-1040). Billing documents are to be rendered quarterly. Payments of bills are due within 60 days after the billing date. If not paid by the due date, interest will be charged at the current Treasury rate for each 30 day period, or portion thereof, that the payment is delayed beyond the due date. (31 USC 3717; Comptroller General File B , August 23, 1983.).

14 Form (Oct. 2005) Page 2 of 2 U.S. Department of the Interior U.S. Geological Survey Joint Funding Agreement FOR Water Resources Investigations Agreement #: 15WSCA Customer #: Project #: ZG009J5 TIN #: USGS DUNS #: Name: USGS Administrative Point of Contact Janee Hiett Name: Customer Technical Point of Contact Tim Crough Address: Telephone: Fax: J Street, Placer Hall Sacramento, CA (916) (916) jdhiett@usgs.gov Address: Telephone: Fax: West Main Street Grass Valley, CA (530) crough@nidwater.com U.S. Geological Survey United States Department of the Interior Nevada Irrigation District Signature Signatures By Date: Name: Eric G. Reichard Title: Director, USGS California Water Science Center By Date: Name: Remleh Scherzinger Title: General Manager By Date: Name: Title: By Date: Name: Title:

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