http://cdec.water.ca.gov/cdecapp/resapp/getResGraphsMain.act...
Levels were slightly lower in 1977, but the population of California was 16 million people lower then. The California Water Project was designed to store enough water to get through 3 years of drought. We just finished drought year 3. (The water year ends Sep. 30, before rainy season starts.)
San Jose has a new sewerage treatment plant so good it can be used to provide drinking water. It just came on line last summer. Right now, it's just being used for irrigation and recharging ground water, but if things get really bad, that backup is available. (http://www.mercurynews.com/science/ci_26160300/california-dr...)
So, yes, extensive preparations for this were made a long time ago.
Rain so far during this water year, starting Oct. 1, is slightly above normal.