MPRWA Regular Meeting Agenda Packet 08-08-13

8/22/2019 MPRWA Regular Meeting Agenda Packet 08-08-13

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AgendaMonterey Peninsula Regional Water Authority (MPRWA)

Regular Meeting

7:00 PM, Thursday, August 8, 2013

Council Chamber580 Pacific Street

Monterey, California

ROLL CALL

PLEDGE OF ALLEGIANCE

REPORTS FROM BOARD DIRECTORS AND STAFF

PUBLIC COMMENTS

PUBLIC COMMENTS allows you, the public, to speak for a maximum of three minutes on anysubject which is within the jurisdiction of the MPRWA and which is not on the agenda. Any personor group desiring to bring an item to the attention of the Authority may do so by addressing theAuthority during Public Comments or by addressing a letter of explanation to: MPRWA, Attn:Monterey City Clerk, 580 Pacific St, Monterey, CA 93940. The appropriate staff person will contactthe sender concerning the details.

APPROVAL OF MINUTES

1. July 25, 2013 Packet Page 1

AGENDA ITEMS

2. Receive Report, Discuss and Provide Recommendations on Opinion Editorials Publishedand Future Opinion Topics Cullem Packet Page 7

3. Receive Report, Discuss, and Provide Recommendations Regarding Trip to PoseidonDesalination Facility Cullem Packet Page 19

ADJOURNMENT

The Monterey Peninsula Regional Water Authority is committed to include the disabled in all of

its services, programs and activities. For disabled access, dial 711 to use the California RelayService (CRS) to speak to staff at the Monterey City Clerks Office, the Principal Office of theAuthority. CRS offers free text-to-speech, speech-to-speech, and Spanish-language services24 hours a day, 7 days a week. If you require a hearing amplification device to attend ameeting, dial 711 to use CRS to talk to staff at the Monterey City Clerks Office at(831) 646-3935 to coordinate use of a device or for information on an agenda.

Agenda related writings or documents provided to the MPRWA are available for publicinspection during the meeting or may be requested from the Monterey City Clerks Office at 580Pacific St, Room 6, Monterey, CA 93940. This agenda is posted in compliance with CaliforniaGovernment Code Section 54954.2(a) or Section 54956.


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MINUTES

MONTEREY PENINSULA REGIONAL WATER AUTHORITY (MPRWA)Regular Meeting

7:00 PM, Thursday, July 25, 2013COUNCIL CHAMBER580 PACIFIC STREET

MONTEREY, CALIFORNIA

Directors Present: Burnett, Edelen, Kampe, Pendergrass, Rubio

Directors Absent: Della Sala

Staff Present: Legal Counsel, Executive Director, Clerk

ROLL CALL

Vice President Burnett led the meeting in President Della Salas absence.

PLEDGE OF ALLEGIANCE

REPORTS FROM BOARD DIRECTORS AND STAFF

Vice President Burnett reported that the deadline for the settlement documents is unchangedand is still scheduled for on August 31, 2013 at 5:00 p.m. He explained that the pre-hearingconference has always been scheduled to be after the settlement concludes and if interveningparties are to resolve a substantial number of issues through the settlement process, theprehearing conference will be less intense.

Executive Director Jim Cullem reported on a scheduled trip for August 7, 2013 to visit theGround Water Replenishment and Desalination Facilities in Southern California. They will bringback any information and lessons learned to the Authority.

PUBLIC COMMENTS

Vice President Burnett opened the floor to public comment. Tom Rowley spoke representingThe Monterey Peninsula Taxpayers Association regarding an article in the Carmel Pine Conestating that the adopted position statement was a final document, but recalled statements madeby Directors that it was a working document. He then spoke to the public confusion due toinaccurate information in local news publications and that he is disappointed that MontereyCounty is not represented on the Authority. He then requested that the Policy PositionStatement more clearly specify the EIR to be a project level review of the alternative desalprojects. Lastly, he spoke to the quoted baseline increase to ratepayers bills of $44 dollars andwished the Authority luck with their proposed outreach plan. Having no further requests to

speak, public comment was closed.

Vice President Burnett requested to agendize discussion at a future meeting of ways theAuthority can assist the County to become a member of the Authority. He then spoke to Mr.Rowleys comments about the baseline bill increase of $44 and requested to get clarificationfrom Cal Am representation.

APPROVAL OF MINUTES


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MPRWA Minutes Thursday, July 25, 2013

Monterey Peninsula Regional Water Authority

Regular Meeting Minutes - Thursday, July 25, 20132

1. July 11, 2013Action: Approved

On a motion by Director Pendergrass, seconded by Director Rubio, and carried by the followingvote, the Monterey Peninsula Regional Water Authority approved the minutes of July 11, 2013:

AYES: 5 DIRECTORS: Burnett, Edelen, Kampe, Pendergrass, RubioNOES: 0 DIRECTORS: NoneABSENT: 1 DIRECTORS: Della SalaABSTAIN: 0 DIRECTORS: NoneRECUSED: 0 DIRECTORS: None

AGENDA ITEMS

2. Receive Presentation, Discuss and Provide Direction on Adopted Position StatementAction: Discussed, Direction Provided and Approved Changes

Executive Director Cullem gave a presentation on the adopted policy position statement with thepurpose to break down the elements of the currently adopted policy position statement in such a

manner that the public could understand the details. He then answered questions from the

Directors. Legal Counsel Freeman indicated that the presentation was for informationalpurposes only and was a general overview of the policy position statement adopted at aprevious meeting.

Director Rubio spoke to the adopted criteria for support of the Cal Am project and requested thedevelopment of more generic criteria that could be applied to other projects as a morecomparable approach.

Vice President Burnett opened the item to public comment. Tom Rowley suggested changes tothe presentation to clarify to the public who the Authority is, provide the status of Surcharge 2,questioned how many wells were needed for testing purposes for accurate results and lastly,questioned if the Authority had considered contracting with SPI Consultants to update theiranalysis to reflect relative costs. Nelson Vega spoke to the portfolio of water projects, andquestioned that they be listed in terms of the priority. He questioned the term competitiveeconomics" and suggested it be measured in dollars to the ratepayer. Lastly, he questionedwhy there was still discussion of other projects, as they are not demonstrating they can besuccessful at delivering water.

Having no more requests to speak, Vice President Burnett closed public comment, respondedto questions and brought the item back to the Directors for discussion. The Director's receivedthe report and acknowledged that it is important that the public is informed of this document dueto the Settlement Agreement deadline. They agreed to a few minimal word changes so thepresentation could be used as an outreach document and a reference between the settlementagreement and the position statement.

On a motion by Director Pendergrass, seconded by Director Rubio, and carried by the followingvote, the Monterey Peninsula Regional Water Authority approved changes to the receivedpresentation regarding the adopted position statement:

AYES: 5 DIRECTORS: Burnett, Edelen, Kampe, Pendergrass, RubioNOES: 0 DIRECTORS: NoneABSENT: 1 DIRECTORS: Della Sala


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ABSTAIN: 0 DIRECTORS: NoneRECUSED: 0 DIRECTORS: None

3. Receive Report, Discuss and Provide Direction on Draft Scope of Services for Public OutreachConsultantAction: Discussed and Approved Scope of Services

Executive Director Cullem spoke to the item and discussed the different options for publicoutreach without duplicating efforts of other public agencies, while keeping costs minimum. Herequested direction on the draft scope of services and permission to move forward securingconsultant services then answered questions from the Directors.

Director Pendergrass expressed concern about the cost and spoke to opportunities foroutreach via editorials in the local newspaper. Director Rubio requested that a meetingsynopsis be provided to report at member city council meetings.

Vice President Burnett opened the item to public comment. Nelson Vega suggested theAuthority communicate why they are different from the Monterey Peninsula Water Management

District and other water agencies and why this agency can deliver a successful project. Havingno additional requests to speak, public comment was closed.

Director Edelen indicated it was not cost effective for a consultant to attend Authority meetings.The Authority Clerk agreed to have an action summary prepared in a timely manner after themeetings to distribute to the member cities.

On a motion by Director Kampe, seconded by Director Rubio, and carried by the following vote,the Monterey Peninsula Regional Water Authority approved the presented draft scope ofservices, eliminating the need for the consultant to attend Authority meetings, and authorizedthe Executive Director to solicit for Public Outreach consultant services:

AYES: 5 DIRECTORS: Burnett, Edelen, Kampe, Pendergrass, RubioNOES: 0 DIRECTORS: NoneABSENT: 1 DIRECTORS: Della SalaABSTAIN: 0 DIRECTORS: NoneRECUSED: 0 DIRECTORS: None

4. Review, Discuss and Provide Direction on Draft Opinion Editorials for Future Publication

Action: Discussed and Provided Direction

Director Burnett spoke to the item and to the intent of providing opinion editorials to theMonterey Herald for publication as a method of public outreach. Executive Director Cullemspoke to the four proposed opinion editorial topics and indicated additional future articles couldaddress items such as the cost of water, contingencies and risks.

Director Burnett then spoke to the timing of the release of the articles and requested that theycoincide with the release of the pending settlement agreement. The Directors discussed timing,distributions that would be acceptable under the California Brown Act, as well as the namesthat should be listed as endorsing the article. The Directors agreed to have the AuthorityPresident endorse the message First.


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Director Burnett opened the item to public comment. Tom Rowley spoke to the importance ofhelping the public understand the true impact the water shortage. Nelson Vega repeated earliercomments that the Authority should not waste their political position and good reputation. Heencouraged the Authority to produce water, allow growth, but keep your eye on the game.Having no further requests to speak, public comment was closed.

Executive Director Cullem recapped the discussion that the Directors agreed to produce two

articles prior to the next meeting. The first would address the purpose of the Authority and it isto be signed by President Della Sala. The second article is to address the settlementagreement and will be signed by both President Della Sala and Vice President Burnett.Additionally, a news release will be completed and distributed if settlement agreement issigned, as it will be a significant event and the public should be made aware.

Director Burnett explained three reasons the settlement agreement is significant:

1) If there is a substantial number of intervening parties agreeing to sign, it is more thanhas been seen in a long time.

2) If Cal Am agrees to the settlement agreement, the savings to the public is in hundreds ofmillions of dollars

3) The ability to facilitate the plant being built, the various contingencies included, itsubstantially increases the prospective that it will cross the finish line.

Executive Director Cullem then explained that after the first two editorials are released, futureeditorials could rotate responsibility between the different Directors and allow them to speak ontheir different topics of interest.

Director Rubio indicated that due to Brown Act requirements only minimal Directors will not beable to review the document prior to release. Therefore, he requested a copy be sent to eachDirector, prior to or same time as it is sent to print. The Directors agreed and directed staff tofacilitate this request.

ADJOURN TO CLOSED SESSION

Vice President Burnett invited public comments on the closed session item and having norequests to speak, adjourned to closed session at 8:55 p.m.

5. Conference with Legal Counsel Existing Litigation, Gov. Code, section 54956.9 CaliforniaPublic Utilities Commission, In the Matter of Application of California-American Water Company(U210W) for Approval of the Monterey Peninsula Water Supply Project and Authorization toRecover All Present and Future Costs in Rates, A.12.04.019, Filed April 23, 2012Action:Discussed and Provided Direction to Negotiating Team

Legal Counsel Freeman announced that the Directors met with the negotiating team pursuant

to Existing Litigation, Gov. Code, section 54956.9 California Public Utilities Commission, Inthe Matter of Application of California-American Water Company (U210W) for Approval of theMonterey Peninsula Water Supply Project and Authorization to Recover All Present and FutureCosts in Rates, A.12.04.019, Filed April 23, 2012 where they discussed and gave direction tothe negotiating team. If the final documents are consistent with the direction provided, theAuthority authorized the President to sign the settlement negotiation documents.

ADJOURNMENT


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Having no further business to conduct, the meeting was adjourned.

ATTEST:

Lesley Milton, Clerk of the Authority Chuck Della Sala MPRWA President


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Agenda Report

Date: August 08, 2013

Item No: 2.

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FROM: Executive Director Cullem

SUBJECT: Opinion-Editorial (op-ed) Articles in the Monterey Herald

RECCOMENDATION:

Staff recommends that the Authority determine the subject matter for future op-ed pieces to the

Herald or to other media outlets, and assign Authority members to co-author future opinion

editorials.

DISCUSSION:

On Aug 3, 2013, the Herald printed the first op-ed which provided an overview of the water

problem we face, the composition and purpose of the Authority, and Cal-Ams MPWSP

submission to the CPUC. Further, it discussed what the portfolio approach is, alluded to the

eight conditions that had to be met to secure the Authoritys approval, and noted topics for

future op-eds.

On Aug 5, 2013, the Herald printed the second op-ed. It reviewed the mission and organization

of the Water Authority, but focused on the four basic criteria that any water project was

expected to meet, as well as the eight specific conditions Cal-Ams MPWSP had to meet in

order to obtain Authority approval. The article then discussed that following the settlement

negotiations and agreements submitted to the CPUC on July 31, 2013, the Authority concluded

the eight conditions had been met. About half the op-ed went on to outline the specific reasons

why the Authority had reached that conclusion.

In both op-eds, we noted that future articles would cover water rates (cost of water to the

public), governance, decision-making, accountability, permit issues, contingency plans, and

schedules.

It has also been suggested that the Authority consider doing a co-authored op-ed with the

MPWMD on the cooperative efforts of both in finding and expediting a solution to the water

crisis.

ATTACHMENTS:

Submitted Opinion Editorials 1 and 2


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How to get that water we all want and need (aka Water 101)

By Chuck Della Sala

If you have lived on the Monterey Peninsula for any length of time, you

know that a major concern is ensuring that we have sufficient water.

Over the past few decades there is likely no local issue that has been

more debated, politicized, voted on and, finally, as frustrating.

Early last year, the Monterey Peninsula Regional Water Authority

(MPRWA) was created, consisting of the six Peninsula cities served by

California American Water (Cal-Am): Carmel-by-the-Sea, Del Rey Oaks,

Monterey, Pacific Grove, Sand City and Seaside. As the mayors of each of

those cities comprise the board were also known as the Mayors Authority.

Our mission is finding a solution to our water shortage created by the

over-drafting of the Carmel River. Despite the good intentions of many and

various ideas and concepts, that answer has remained elusive.

The MPRWA is working toward getting the necessary water in a timely

fashion and a financially responsible manner. In the process we need to

address such issues as why we have a water shortage and why it hasnt been

solved, why water is expensive and how much more it may cost in the


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future, what are the contingency plans and, finally, why what we are doing

will succeed.

Simple, eh?

For starters, how did we get to this point in time?

In 1978, the community formed the Monterey Peninsula Water

Management District (MPWMD) to address our growing demand for water,

which, by the mid 1990s, had resulted in over-drafting water from the

Carmel River and the Seaside Aquifer. Despite increased water

conservation efforts, the Peninsula was unable to reach a consensus or come

up with something that successfully passed judicial review.

In 2006, a court decision mandated reductions in pumping from the

Seaside Aquifer, and in 2009, the State issued a Cease and Desist Order

imposing a deadline of Jan. 1, 2017, to greatly reduce water withdrawals

from the Carmel River. With a Sword of Damocles hanging over us, the

task was clear: We simply had to find an alternative water supply in the face

of future severe rationing.

To facilitate the process, the State gave the California Public Utilities

Commission responsibility to decide what water project(s) would be built. In

2012, Cal-Am, Marina Coast Water District, and Monterey County proposed


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a Regional Water Project. After that project failed Cal-Am proposed the

current Monterey Peninsula Water Project.

Accordingly, in January 2012, the MPRWA was created. Our purpose is

to study, plan, develop, finance, acquire, construct, maintain, repair, manage,

operate, control and govern water projects. Its like being a clearinghouse.

One of our primary responsibilities is to address public concerns about

the transparency of the project development process and about the projected

increased cost of water.

Mastering the complexity of the water issue requires the MPRWA to

travel a sometimes prickly path: navigate bureaucracies, sit through long

meetings, balance competing interests, and understand engineering,

hydrology, the law, and, of course, politics.

Cal-Am thinks it has a solution. It filed an application in April 2012

with the state Public Utilities Commission for the Monterey Peninsula Water

Supply Project, a project chosen after Cal-Am examined 11 potential

alternatives to the original Regional Desalination Project. The current

project is comprised of three primary elements referred to as a Portfolio

Approach. They are desalination of seawater (desal), aquifer storage and

recovery and groundwater replenishment or water recycling. A recent small


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addition to the Portfolio is the Pacific Grove recycling project that might

reduce potable water demand by up to 3 percent.

The Mayors Authority supports the portfolio approach because even if

one major aspect gets delayed the other two can continue to move forward.

Cal-Am plans to build a saltwater desal plant with slant well intakes

beneath the seabed on the coast north of Marina. Its size depends on the

success of the recycled water project. Our belief is that desal has to be part

of the mix because, without it, the rest of the portfolio would be unable to

provide the needed water.

Aquifer storage and recovery is already used by Cal-Am and the

MPWMD to take excess flows off the Carmel River in the winter to be

stored in the Seaside Groundwater Basin for later use. This process will be

expanded in the new project.

Groundwater replenishment is a project of the Monterey Regional Water

Pollution Control Agency and MPWMD that would thoroughly treat

wastewater before returning it to the Seaside Basin.

Although there are two other desal alternative projects under

consideration, time is of the essence. Accordingly, the Mayors Authority

could support Cal-Ams project as part of the portfolio approach if eight

conditions are met. Our position policy statement outlines those conditions,


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which we will detail in a subsequent commentary in The Herald. We will

also examine the effect of water rates, governance, decision-making and

accountability, and the issues of permits, contingency plans and schedules.

In summary, over the last year and a half, we have all worked hard to

address past failures and to find a viable water project. We have focused on

consensus, transparency, adequate financing, and the importance of

contingency planning. As a result, we strongly believe the community is

the closest it has ever been to a achieving a water supply solution.

And we know that you will be closely watching us.

Chuck Della Sala is the mayor of Monterey and the president of the

Monterey Peninsula Regional Water Authority.

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Cal-Am has best plan to prevent water rationing (Water 102)

By Chuck Della Sala and Jason Burnett

A few days ago, in How to get that water we all want and need (aka Water

101) that appeared in this space in The Herald, we discussed how the Monterey

Peninsula, after years of fits and starts, continues to find itself in a serious water

supply crisis.

We noted some of the steps that have put us in this position, but the bottom line

remains that the state has imposed a cease and desist order, with a deadline of Jan.

1, 2017, to greatly reduce the over-drafting of water from the Carmel River. If

that condition isnt met, the Monterey Peninsula faces the likelihood of drastic

water rationing.

In January 2012 a new group was formed to address the problem and provide

some public control: the Monterey Peninsula Regional Water Authority

(MPRWA), made up of the mayors of the six Peninsula cities served by California

American Water. They are Carmel-by-the-Sea, Del Rey Oaks, Monterey, Pacific

Grove, Sand City and Seaside. It is known as the Mayors Authority because it is

made up of the mayors of each of those half-dozen cities.


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We know some of you may be thinking: Why do we need yet another alphabet

soup agency to deal with our longstanding water issues?

We aim to answer that by fulfilling our mission to find a solution and to get the

needed water in both a timely and financially responsible manner.

On April 23, 2012, Cal-Am submitted an application to the California Public

Utilities Commission (CPUC) for a new Monterey Peninsula Water Supply

Project. It includes a desalination facility north of Marina. Meanwhile, since its

inception, the MPRWA has adopted a portfolio approach to water projects,

including the desal option, to avoid placing all our supply options in one basket.

After a series of public meetings, the Mayors Authority adopted a policy

position statement that mandated that any project (particularly desal projects) must

meet the following four basic criteria:

Competitive economics (especially from the ratepayers perspective); Control by elected officials, accountability to the public, and a transparent

decision-making process;

A clear path to permits and construction as near to the cease and desist orderdeadline as feasible, and

Contingency plans to address technical, permit, and legal risks.


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Besides Cal-Ams desal facility, there were other projects in the running, but the

MPRWA recently determined that while none immediately met all of our basic

criteria, the Cal-Am project was the most likely to be able to do so.

Granted, many folks feel weve been down this road before. But we indicated

we could support Cal-Ams project if it meets eight fairly detailed and precise

conditions of approval:

Accept approximately 50 percent public funds to reduce interest rate andprofit expenses;

Diligently seek lowest electricity rates to lower the costs of desal operations; Agree that any additional surcharges on ratepayers bills be spent only on

actual project construction, subject to PUC approval;

Be able to obtain a state loan and accept a public agency partner if neededto qualify for that loan;

Agree to public oversight by a Governance Committee that includes electedofficials;

Agree to resolve certain environmental and approval requirementsrelated to how it obtains necessary feed water (intake) for the desal facility;

Develop contingencies for feed water that do not impact farmingactivities in the Salinas Valley and are completed in a timely manner, and

Ensure its feed water wells (slant intake wells) can withstand sea level


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rise, coastal erosion, earthquakes, and tsunamis.

On July 31, agreements between Cal-Am, the MPRWA, and a significant

number of groups that had previously voiced concerns about the Monterey

Peninsula Water Project, were filed with the CPUC. Cal-Am has met the

MPRWAs eight conditions of approval.

Accordingly, the MPRWA decided to approve the Cal-Am project because:

Cal-Am has made some very significant concessions that are of great benefitto the ratepayers.

Cal-Ams 9.6 million gallon per day (mgd) desal, or an alternative 6.4 mgdplant supplemented by a 3.2 mgd groundwater replenishment project, can

replace Carmel River water and replenish the Seaside aquifer and can satisfy

the communitys water needs through a variety of new water sources

(portfolio approach),

The Cal-Am project appears to have a substantial lead over the competingDeepwater Desal (DWD) and Peoples Moss Landing (PML) projects in

planning, financial, permitting, electrical power acquisition, and

minimization of risk, and,

Cal-Am has agreed to minimize costs to the ratepayers by utilizing cheaperpublic funding if available, by using a competitive process to select the


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design build contractor, and utilizing a value-engineering firm to squeeze out

more savings in the desal design.

There were a number of additional considerations that the Mayors Authority

successfully negotiated with the state PUC as part of the agreements submitted on

July 31 to include local control of water allocation decisions, measures to address

future water supply needs, inclusion of water recycling projects proposed by the

City of Pacific Grove, and a connection fee for new water users to reimburse

current ratepayers.

We intend to further examine these important issues in a future column,

covering such issues as accountability, contingency plans, the cost of water to the

public and schedules.

Chuck Della Sala is the mayor of Monterey and the president of the Monterey

Peninsula Regional Water Authority. Jason Burnett is the Mayor of Carmel-by-the-

Sea and the Authority Vice-President.

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Agenda Report

Date: August 08, 2013

Item No: 3.

06/12

FROM: Executive Director Cullem

SUBJECT: Receive Report, Discuss, and Provide Recommendations Regarding Trip to

Poseidon Desalination Facility

DISCUSSION:

There is no written report for this item. An oral report will take place at the meeting.


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MPRWA Regular Meeting Agenda Packet 08-08-13

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