Valley Water continues investment in future water storage at San Luis Reservoir

August 21, 2026

An aerial view from a drone shows green vegetation around Dinosaur Point Boat Launch Ramp and high lake levels at San Luis Reservoir on April 15, 2025. On this date, the reservoir storage was 1,805,235 AF, or 88 percent of the total capacity. Photo courtesy of Xavier Mascareñas / California Department of Water Resources.

On Aug. 11, 2026, the Valley Water Board of Directors approved up to $1.34 million for ongoing planning costs for the B.F. Sisk Dam Raise and Reservoir Expansion Project.

Six agencies, including Valley Water, are collaborating with the San Luis & Delta-Mendota Water Authority and the U.S. Bureau of Reclamation to develop this expansion project. The project’s goal is to raise the existing B.F. Sisk Dam by 10 feet, which will increase San Luis Reservoir’s storage capacity by 130,000 acre-feet. Valley Water has reserved 63,560 acre-feet of the new storage, which is more than any of its local reservoirs except Anderson.

The Reservoir Expansion Project is integral to the lower-cost strategy within Valley Water’s Water Supply Master Plan 2050, which the Board adopted on Nov. 12, 2025. The plan serves as a roadmap for Valley Water’s potential investments over the next decade that will help maintain a safe and reliable water supply for our community.

The Water Supply Master Plan was developed with extensive public outreach and input from community members and partner organizations.

San Luis Reservoir, located about 30 miles east of Gilroy off State Route 152, already plays a crucial role in Valley Water’s water supply system. Valley Water receives imported water through State Water Project and Central Valley Project contracts. The San Luis Reservoir serves as a major storage and staging location for imported water before it is delivered to Santa Clara County. Because of this, all water rights, as well as the infrastructure needed to deliver Valley Water supplies to store and later send to Santa Clara County, are already in place.

Water storage projects are an important part of Valley Water’s project portfolio because they help build reserves during wetter periods for use during droughts, providing an important buffer against water shortages. They also enhance the benefits of water supply projects outlined in the Water Supply Master Plan.

Valley Water can currently store water in San Luis Reservoir when space is available, but we do not have dedicated, reliable storage capacity there. Our stored water often exceeds our storage capability during wet years. The Reservoir Expansion Project would provide Valley Water with dedicated storage capacity at San Luis Reservoir, enabling reliable, long-term storage even in wet years. This would allow Valley Water to save more water during wet years and keep it for use during dry years.

The Water Supply Master Plan analysis indicates that this project is among the most cost-effective projects available to Santa Clara County. Valley Water is working diligently with its partners to advance this project through the planning phase.

Valley Water has contributed about $3.4 million toward planning and development of the Reservoir Expansion Project to date. The additional funding approved by the Board will cover Valley Water’s share of continued program management, planning and design costs through February 2027.

The project’s total capital cost is projected to range from $847 million to $1.045 billion. Based on Valley Water’s current participation level, its estimated share ranges from $414 million to $512 million. Planning and design work continues on several fronts. The project is expected to reach its 30% design milestone later this month, which will provide the basis for an updated construction schedule and cost estimate anticipated this fall.

A major component of the project involves modifying State Route 152 near San Luis Reservoir. As part of the project, an estimated one-mile stretch of the highway would be raised by about 10 feet and slope protection would be added to an overlook.

Design teams will continue their work until mid-2028. Project partners are expected to make their final participation decisions before August 2028. The Bureau of Reclamation anticipates the construction of the dam raise to be completed in 2034.

The Board’s decision allows Valley Water to stay involved as planning and design of the Sisk Project continue. This will give Valley Water more information about the project’s costs, funding and other details. The information will help the Board decide whether the project is a good investment for Santa Clara County.

B.F. Sisk Dam is pictured at San Luis Reservoir in Merced County, California. Photo taken April 15, 2025. On this date, the reservoir storage was 1,805,235 AF, or 88 percent of the total capacity. Photo courtesy of Xavier Mascareñas / California Department of Water Resources.

Valley Water manages an integrated water resources system that includes the supply of clean, safe water, flood protection and stewardship of streams on behalf of Santa Clara County's 2 million residents. Valley Water effectively manages 10 dams and surface water reservoirs, three water treatment plants, an advanced recycled water purification center, a state-of-the-art water quality laboratory, nearly 280 acres of groundwater recharge ponds and 350 miles of waterways. We provide wholesale water and groundwater management services to local municipalities and private water retailers who deliver drinking water directly to homes and businesses in Santa Clara County.