mprwa agenda packet 12-11-14

8/10/2019 MPRWA Agenda Packet 12-11-14

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AgendaMonterey Peninsula Regional Water Authority (MPRWA)

Regular Meeting

7:00 PM, Thursday, December 11, 2014

Council Chamber580 Pacific Street

Monterey, California

ROLL CALL

PLEDGE OF ALLEGIANCE

REPORTS FROM BOARD DIRECTORS AND STAFF

PUBLIC COMMENTSPUBLIC 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.

CONSENT AGENDA

1. Approve A One-Year Contract Extension With Environmental Resources, Inc. For PublicInformation Services At A Total Price Not-To-Exceed $10,000 And Authorize TheExecutive Director To Negotiate The Terms Of The Extension And To Award The Contract.- Cullem

2. Approve Minutes from November 13, 2014 Regular Meeting - Milton

3. Approve and File Checks Through December 11, 2014 - Milton

AGENDA ITEMS

4. Receive Report On The Status Of The Pure Water Monterey (PWM)/GroundwaterReplenishment (GWR) Project And Status Of The Bi-Lateral Agreements On The GWRSource Water Definitive Agreement. - Stoldt/Israel

5. Review, Discuss, And Provide Direction On The Mission Of The Water Authority And

Accomplishments In 2014. - Cullem

6. Receive Report, Discuss, And Provide Staff Direction On The Status Of The Slant TestWell Construction and Of The Litigation Related to The Marina Coast Water District Appealof the Coastal Development Permit (CDP) - Crooks

7. Receive Report, Discuss, And Provide Staff Direction On Updated CPUC Schedule. -

Cullem
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Monterey Peninsula Regional Water AuthorityAgenda Report

Date: December 11, 2014

Item No: 1.

FROM: Executive Director Cullem

SUBJECT: Approve a one-year contract extension with Environmental Resources,

Inc. for public information services at a total price not-to-exceed $10,000

and authorize the Executive Director to negotiate the terms of the

extension and to award the contract .

RECOMMENDATION:

Staff recommends a one-year contract extension with Environmental Resources, Inc. at

the current hourly rate for a total price not-to-exceed $10,000, to provide publicinformation services to the Water Authority for FY 2014-2015, and also recommends

the Authority authorize the Executive Director to negotiate the terms of the extension

and to award the contract.

DISCUSSION:

At its meeting on April 25, 2013, the Water Authority approved a Public Outreach

budget of $49,000 of which $20,000 was budgeted for Speakers Bureau Support.

Following an RFP process in September 2013, the Water Authority awarded a contract

to Environmental Relations PR for Public Outreach Services for the FY 2013-2014 at a

price not-to-exceed $15,000. A copy of the current Scope of Work is at Exhibit A.

The Executive Director has been satisfied with the quality and quantity of the services

provided by Environmental Services, Inc. Accordingly, and in light of the fact that the

contract is relatively small and re-advertisement of the Public Outreach Services

contract is relatively costly and time consuming, the Director recommends that the

Water Authority extend the contract for another year, as permitted under paragraph 3 of

the contract.

However, per Water Authority Board direction on October 9, 2014 to reduce budget

obligations wherever possible, and in light of anticipated of reduced public outreachneeds in the coming year, staff revised the Scope of Work for the FY 2014-2015

contract extension and the draft is at Exhibit B.

FISCAL IMPACT:

At fiscal year end, the Authority had expended quite a bit less than $49,000 in FY 2013-

2014 for Public Outreach, and actual contract expenditures for the Public Outreach


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Services contract were substantially less than $15,000 as well. Since the FY 2013-2014

budget was approved by the Authority Board on April 10, 2014, prior to fiscal year

closeout, the Public Outreach budget for FY 2014-2015 was left at $49,000.

The contract for the Public Outreach contract, at a total cost not-to-exceed $10,000, is

at attachment C. The cost of the contract is included in the approved budget. Ifauthorized by the Authority Board, this contract would be extended to September 30,

2015.

EXHIBITS:

The following attachments can be accessed from the below links:

A-Public Outreach Scope of Services for FY 13-14 :

http://www.isearchmonterey.org/view.aspx?cabinet=published_meetings&fileid=206888

B-Draft Public Outreach Scope of Work for FY 14-15:http://www.isearchmonterey.org/view.aspx?cabinet=published_meetings&fileid=206889

C- Contract for Public Outreach Services:

http://www.isearchmonterey.org/view.aspx?cabinet=published_meetings&fileid=206890


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MINUTES

MONTEREY PENINSULA REGIONAL WATER AUTHORITY (MPRWA)Regular Meeting

7:00 PM, Thursday, November 13, 2014COUNCIL CHAMBER580 PACIFIC STREET

MONTEREY, CALIFORNIA

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

Directors Absent: None

Staff Present: Executive Director, Legal Counsel, Clerk of the Authority

ROLL CALL

All Directors were present.

PLEDGE OF ALLEGIANCE

REPORTS FROM BOARD DIRECTORS AND STAFF

President Burnett invited reports from the Directors and Staff.

Vice President Kampe reported that during the Mayor's Association meeting he discussedMonterey Countys participation as a member of the Authority with Supervisor Potter whoinformed him there was a subcommittee established to meet with Authority Members. ExecutiveDirector Cullem reported that the TAC will conduct a site visit to both the People's MossLanding Desal and the Deep Water Desal Project. He invited the Directors to attend as well asextended an invitation to Monterey Mayor-Elect Roberson. Mr. Cullem spoke to the need tomeet with the County Supervisors regarding contributions, to the issue of sun setting the

Authority and requested direction to address both issues at the same time.

President Burnett presented a certificate of appreciation to Director Della Sala for his service onthe Authority and to the impacts he made during his tenure.

PUBLIC COMMENTS

President Burnett invited comments from the public.

George Riley expressed appreciation to Director Della Sala for his efforts and hisdiplomacy.

Tom McMahon of Monterey Bay Laundry, Chairman of the Pacific Grove DowntownBusiness Improvement District thanked the Authority for efforts to solve the problem butexpressed concern regarding his recent closure of one of his business locations due tothe unknown increase in the cost of water and expressed frustration that smallbusinesses have no voice in this process.

CONSENT CALENDAR


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MPRWA Minutes Thursday, November 13, 2014

Monterey Peninsula Regional Water Authority

Regular Meeting Minutes - Thursday, November 13, 20142

Legal Counsel Freeman left the room to recuse himself from Item 3.

On a motion by Director Rubio, seconded by Director Edelen, and carried by the following vote,the Monterey Peninsula Regional Water Authority approved the Consent Calendar aspresented.

AYES: 6 DIRECTORS: Burnett, Edelen, Kampe Pendergrass, Della Sala, RubioNOES: 0 DIRECTORS: NoneABSENT: 0 DIRECTORS: NoneABSTAIN: 0 DIRECTORS: NoneRECUSED: 0 DIRECTORS: None

1. Approve Minutes from October 9, 2014

2. Approve and File Checks Through November 13, 2014

3. Adopt a Resolution Approving Donald G. Freeman as Legal Counsel through December 31,

2015 and Authorizing the Authority President to Execute a Contract Extension with PerryFreeman at a Price Not-to-Exceed $63,000.

4. Adopt a Resolution Approving Brownstein, Hyatt, Farber and Schreck as Special Legal Counselthrough December 31, 2015 and Authorize the Authority President to Execute a ContractExtension at a Price not-to-Exceed $152,000.

5. Approve Extension of Deadline for Fiscal Year 2013-14 Financial Report and Full Opinion Auditto December 21, 2014 and Authorize a Time Extension of the Contract with McGilloway, Ray,Brown and Kaufman to March 31, 2015.

AGENDA ITEMS

6. Receive Report, Discuss, and Provide Direction on the Meeting with State Water ResourcesControl Board Staff on November 7, 2014.

President Burnett, Executive Director Cullem and Legal Counsel Freeman reported on theirmeeting with the State Water Resources Control Board to discuss and respond to requests forinformation regarding the Cease and Desist Order (CDO). Director Burnett indicated that theBoard is responsive to the need to modify the CDO but urged mindfulness of their position andrecommended to try to meet them in the middle.

Any modification of the CDO would require the following:

1) Continued pressure to deliver a water supply.2) Any modification must lead to more water in the Carmel River than there is today.3) Continued physical mitigation to the Carmel River4) Establishment of contingencies so that progress continues, and established

consequences if progress is not reached.


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MPRWA Minutes Thursday, November 13, 2014

Monterey Peninsula Regional Water Authority

Regular Meeting Minutes - Thursday, November 13, 20144

Executive Director Cullem reported on this item and spoke to the substantial savings in the lastfiscal year that was driven with the slowdown of the project, requiring less demand from speciallegal counsel, fewer meetings and administrative costs resulting in a budget surplus. He thenspoke to the joint powers authority agreement bylaw which allows the Authority to returnunused contributions to the Cities in the event of an end of year surplus. He recommendedagainst modifying the current fiscal year budget at this time.

President Burnett invited public comment on the item and had no requests to speak.

On a motion by Director Kampe, seconded by Director Edelen, and carried by the followingvote, the Monterey Peninsula Regional Water Authority directed staff to credit any FY 13-14year-end budget surpluses to the FY 14-15 contribution request for each contributing Citybased on approved distribution percentages:

AYES: 6 DIRECTORS: Burnett, Edelen, Kampe Pendergrass, Della Sala,Rubio

NOES: 0 DIRECTORS: None

ABSENT: 0 DIRECTORS: NoneABSTAIN: 0 DIRECTORS: NoneRECUSED: 0 DIRECTORS: None

ADJOURNMENTThe meeting was adjourned at 8:28 PM.

ATTEST:

Lesley Milton, Clerk of the Authority Jason Burnett, President


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Item No: 3.

FROM: Authority Clerk Milton

SUBJECT: Approval and File Authority Checks Through December 11, 2014.

RECOMMENDATION:

It is recommended that the Authority approve and file the accounts payable paymentsmade during the period November 13 through December 1, 2014 with total paymentsfor the above referenced period of $850.00 from the general fund account and authorizethe Directors to sign for such checks.

DISCUSSION:

At its meeting on September 12, 2013, the Authority Board approved a staffrecommendation to provide the Directors a listing of general checks issued since the lastreport so that it can inspect and confirm these checks. Each invoiced expense has beenreviewed and approved by the Executive Director and Finance personnel prior to paymentto insure that it conforms to the approved budget.

The following checks are hereby submitted to the Authority for inspection andconfirmation.

$ 850.00 to Environmental Relations for public outreach and website updates

The bank balance as of December 5 2014 is sufficient cover the above check therefore,staff is recommending approval.

ATTACHMENTS:

Budget to Actual Report through December 5, 2014


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Item No: 4.

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SUBJECT: Receive Report On The Status Of The Pure Water Monterey(PWM)/Groundwater Replenishment (GWR) Project And Status Of The Bi-Lateral Agreements On The GWR Source Water Definitive Agreement.

RECOMMENDATION:

It is recommended that the Water Authority Board receive a presentation from DaveStoldt and Keith Israel on the status of the projected bi-lateral agreements leading to a

"Definitive Agreement" on source water for GWR.

DISCUSSION:

Following agreement on an MOU for the source water for the Monterey RegionalPollution Control Agency Pure Water Monterey (PWM)/ Groundwater ReplenishmentProject (GWR) project, a series of bi-lateral agreements are required leading to a"Definitive Agreement" which would finalize the waste water and recycled wateravailable for injection into the Seaside Aquifer as part of the Monterey Peninsula WaterSupply Project (MPWSP).

At the TAC meeting of December 1, 2014, Dave Stoldt and Keith Israel provided anddiscussed the attached list of legal agreements and tentative dates. Since the WaterAuthority Board will be reviewing the updated CPUC schedules on a later agenda item,a review of the attached list is appropriate at this time.

ATTACHMENTS:

Roadmap for a Definitive Agreement on Source Waters and Water Recycling


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Item No: 5.

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Item No: 5.

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Item No: 6.

06/12


SUBJECT:Receive Report, Discuss, and Provide Staff Direction on theStatus of the Test Slant Well Construction and of the LitigationRelated to the Marina Coast Water District Appeal of theCoastal Development Permit (CDP).

RECOMMENDATION:

It is recommended that the Water Authority Board receive a report from CalAm on the status of the construction of the test slant well and how theMCWD litigation might impact the schedule. The Authority may want toprovide direction to staff since the litigation may delay the entire MontereyPeninsula Water Supply Project (MPWSP).

DISCUSSION:

At its meeting of November 7, 2014, the California Coastal Commission

issued a Coastal Development Permit (CDP) for Cal Am's test slant well atthe CEMEX site. In addition, Cal Am and CEMEX have reached agreementfor access to the site.

On November 26 the Marina Coast Water District (MCWD) filed a lawsuit inSacramento Superior Court appealing the Coastal Commission CDP andrequesting a Restraining Order preventing Cal Am from starting the testwell construction.

On December 5 Cal Am requested a change of venue to the MontereyCounty Superior Court. The judge will rule on that motion on December 10.

The issuance of the CDP is critical to the MPWSP schedule, since drillingof the test slant well needs to commence on or about Dec 15 and proceed24/7 to complete installation prior to the Snowy Plover nesting season,estimated to start around March 1, 2015. The delay of even a few weeks


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from Dec 15 construction start could result in the inability to get the test wellinstalled in time with a likely resultant 1 year delay in the completion of theMPWSP and additional delay past the deadline for CDO 2009-60.

As the result of the December 10th hearing should be known at the time ofthe Water Authority meeting, staff requests the Authority Board receive astatus report from Cal Am, discuss the situation, and provide staff guidanceas appropriate.


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Item No: 7.

06/12


SUBJECT: Receive Report, Discuss and Provide Staff Direction onUpdated CPUC Schedule.

RECOMMENDATION:

Staff recommends that the Water Authority review and discuss the current

CPUC schedule for the Monterey Peninsula Water Supply Project(MPWSP) as annotated by staff.

DISCUSSION:

At its meeting of June 12, 2014, the Water Authority received a "focused"staff revision of the 7 October 2013 CPUC schedule for the MPWSPincluding the activities needed for a successful and timely GWR project.

Since that time, a number of delays in both the Cal Am Desal project and inthe GWR source water negotiations have resulted in the CPUC makingadditional changes. In addition, the Securitization legislation was signedinto law and the slant test well approvals have moved forward.

Since changes have been made in a piecemeal fashion, staff has preparedan update for the complete schedule, as of 11 December 2014, identifyingdifferences in comparison to the 7 October 2013 schedule.

This annotated schedule should help identify upcoming deadline dates andhelp to focus the efforts of the Authority and the staff.

ATTACHMENTS:

Updated CPUC schedule for the MPWSP dated 11 December 2014.


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UPDATED Schedule and Task List for MPWSP Post Settlement (REV 11 DEC 2014)

RED are changes from 7 Oct 13 Schedule.

CPUC Calendar Dates

Task Due Date Responsible Party NotesComments onSettlement Agreements

Due

August 30, 2013 Complete

Reply Comments onSettlement Agreements

Due

September 13, 2013 Complete

PrehearingConference: Status ofSettlement Motion (ifany), of CEQA work

& other matters

September 16, 2013 Complete

Quarterly Check-in Call

with Settling Parties

October 2014 MPRWA Complete

Informational Hearingon SettlementAgreements

April 16, 2015

Quarterly Check-in Callwith Settling Parties

January 2015 MPRWA

DEIR circulated forComment

Jan 30, 2015


April 2015 MPRWA

Cal-Am to file and servea common outline for

legal and policy briefs,after consulting with

parties

Feb 17, 2015

Comments on DEIRDue

Mar 16, 2015

Common OutlineOpening Briefs filed and

served on legal andpolicy issues

April 1, 2015

Reply Briefs filed andserved on legal and

policy issues

April 16, 2015

FEIR published July 30, 2015

ProposedDecision addressing

certification of FEIR andissuance of CPCN

3rd Qtr 2015


July 2015 MPRWA

Target for CommissionAction on Phase I

3rd Qtr 2015

Quarterly Check-in Call October 2015 MPRWA


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Task Due Date Responsible Party Notes

with Settling PartiesQuarterly Check-in Call

with Settling PartiesJanuary 2016 MPRWA


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GWR (Rev 11 Dec 2014)


File Motion forBifurcation of theGWR Decision

August 2013 MRWPCA Complete and Granted

Board Actions toApprove RevisedGovernance Committee

Agreement

August/Sept 2013 MPWMD, MPRWA,County, & Cal-Am Completed ????

Executed Agreementsfor GWR Source Water

and/or DeclaratoryRelief

6 Party JointMOU Approved mid-Oct

2014

MRWPCA Meet & Confer inProgress for DefinitiveAgreements (March

2015)

Draft WPAApril 2015

MPWMD & MRWPCA Delayed per Oct 2014CPUC Adjustment of

Phase 2 Schedule

Obtain Representations

from DPH re Use ofExtracted GWR Water June 2014

MRWPCA Dept Public Health

Concept ProjectApproval receivedJune 2014

Obtain Representationsfrom RWQCB re Use ofExtracted GWR Water June 2014

MRWPCA ????

Storage Agreementwith Seaside Basin

Watermaster March 2015

MRWPCA & MPWMD

GWR Basis of DesignComplete with At Least

10% Design October 2015

MRWPCA ????

GWR Financing PlanSufficient for SRF

Funding May 2015

MRWPCA & MPWMD

Agreement on Terms ofWPA

June 2015

Cal-Am, MRWPCA,&MPWMD

Perform RevenueRequirement Analysis

Including Any DebtEquivalency Effect

May 2015

MRWPCA & MPWMD

Perform Assessment ofGWR Positive and

Negative Externalitiesfor Any Premium

Showing

April 2015MRWPCA & MPWMD

DEIR Circulated March 2015 MRWPCA Coord w/Cal Am DEIR

Dilution Water MRWPCA


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Requirements Not RequiredProject Approved and

FEIR September 2015MRWPCA

All Permits for GWRConstruction Obtained

February 2016

MRWPCA For Major Permits


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Source Wells (Rev 11 Dec 2014)


Drill ExploratoryBoreholes

Sept. 2013 February2014

Cal-Am Complete

Commence

Hydrogeologic Studyand Technical Report

August 2013 Cal-Am / SVWC IN PROGRESS

Permits for CEMEXSite Test Well

Nov 12, 2014 Cal-Am MND in May 2014Coastal Commission

CDP Req'd

Drill CEMEX Site TestWell

Nov 14-Feb 15 Cal-Am

Results of Test WellOperation Obtained

February 2015 February 2017

Cal-Am

Hydrogeologic Studyand Technical ReportComplete and Results

Filed with CPUC?

Cal-Am

Necessary Agreementsfrom CEMEX forSource Wells

? Cal-Am ?

All Necessary Permitsfor Construction of

Source Wells Obtained?

Cal-Am ?


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Securitization (Rev 11 Dec 2014)

Initial Revision and

Redline of Legislation

Early September 2013 MPWMD Complete

Obtain Cal-Am Input onDraft Legislation

Late September 2013 MPWMD, MPRWA, &Cal-Am

Complete

Retain Necessary

Additional

Financial/Legal

Consultants (Charles

Atkins)

October 2013 MPWMD Complete

Revise Financial

Comparison of

Securitization v. Cal-Am

Financing

October 2013 MPWMD & Cal-Am On-Going

Meeting with

Community/Interest

Groups and Cities

October-December

2013

MPWMD & MPRWA Complete

Further Revise

Legislation as

Necessary

October-November

2013

Complete

Draft Summary of

Legislation

December 2013 MPWMD Complete

Introduce Legislation January 2014 Complete

Lobbying Effort February-April 2014 MPWMD, MPRWA, &

Cal-Am

Complete

Governor Signed Sept 19, 2014 Complete

Initial Draft of Motion for

Financing Order

March 2015 MPWMD

Perform Analysis toDemonstrate Annual

Customer Benefits

Exceed 1.0% of Total

Annual Revenue

Requirement

March 2015 MPWMD & Cal-Am

Application for May 2015 MPWMD


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Financing Order

Obtain CPUC Financing

OrderNovember 2015

Order on securitization

financing on satisfaction

of remaining criteria

from Settlement K

Complete??

Drafting of bond

Documents

January-April 2015 MPWMD & Cal-Am

Preliminary Discussions

with Rating Agencies

February-April 2015 MPWMD

Issuance of Public BondFinancing

Q2-Q3 2015 MPWMD


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Monterey Peninsula Regional Water AuthorityMonterey Peninsula Regional Water AuthorityMonterey Peninsula Regional Water AuthorityMonterey Peninsula Regional Water AuthorityAgenda ReportAgenda ReportAgenda ReportAgenda Report


Item No: 8.

06/12


SUBJECT:Receive Status Report on the FY 2013-2014 Audit, Discuss,and provide Staff Direction.

RECOMMENDATION:

It is recommended that the MPRWA Board receive an update on the FullOpinion Audit for Fiscal Year 2013-2014.

DISCUSSION:

At its meeting of February 13, 2014, the Authority received a formalpresentation of the FY 2012-2013 audit and extended the McGilloway, RayBrown, Kaufman contract to conduct the FY 2013-14 audit.

Pursuant to Article 6 of the JPA, the audit and annual report are dueDecember 1, 2014. Due to changes in our accounting procedures and

accounting staff this past year, at the November 13, 2014 Water Authoritymeeting the Executive Director received Board approval for an extension ofthe audit deadline to December 31, 2014.

In addition, an extension of the contract completion date from December31, 2014 to March 31, 2015 was approved to allow for for any unanticipatedaudit follow-up.

The draft audit was completed on December 10, 2014 but needs to beapproved by the Finance Committee before being presented to the

Authority Board. That meeting will take place in the next few weeks.

Though staff expects the December 31, 2014 date for completion of theaudit will to be met, the Water Authority will not have an opportunity toreceive the audit report until its January or February 2015 meetings, unlessthe Board wishes to hold a special meeting before then.


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Item No: 9.

06/12


SUBJECT:Receive Report, Discuss, and Provide Staff Direction on theUpdated MPWSP Critical Path (CPM) Permits & ApprovalsSchedule (Summary Version) to Include the Impact of GWR,and Discuss Future Permits and Approvals Required of Marina.

RECOMMENDATION:

It is recommended that the Water Authority receive an update from Cal Amon the most current Summary Version of the MPWSP Critical PathSchedule for Permits and Approvals, including the GWR project and thosefuture permits and approvals that will be required from the City of Marina,and provide guidance to Authority staff accordingly.

DISCUSSION:

Cal Am reviews the "Detailed" CPM Permits and Approvals Schedule for

the MPWSP with the TAC each month. That schedule will be getting moreattention by the TAC to enable it to better anticipate the kinds of delays CalAm experienced the last two years in trying to obtain bore hole and testwell permits from the city of Marina.

Cal Am usually briefs the Water Authority Board with a "Summary" versionof the CPM. Cal Am has now included the relationship between the GWRschedule and the MPWSP. Staff has also requested Cal Am include futurerequirements to obtain permits from the City of Marina and how these might

impact the community's ability to meet the CDO deadline.

ATTACHMENTS:

Current Cal Am critical path schedule (Summary Version) for Permits andApprovals - (to be provided at the meeting)


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Item No: 10.

06/12


SUBJECT:Receive Report, Discuss, and Provide Staff Direction onCurrent Efforts to Seek an Extension of the CDO Deadline ofDecember 31, 2016.

RECOMMENDATION:

It is recommended that the Water Authority Board receive an update on

efforts by the settling parties, including Cal Am, the Water ManagementDistrict, and the MPRWA to obtain an extension of the CDO 2009-60deadline date.

DISCUSSION:

Due to a variety of reasons, many beyond the control of Cal Am, as well asthe community, the Monterey Peninsula Water Supply Project (MPWSP)has been delayed to the point where it is virtually impossible for Cal Am to

meet the State Water Resources Control Board CDO 2009-60 deadline ofDecember 31, 2016.

Representatives of the settling parties have been in discussion withSWRCB staff in an effort to develop proposals acceptable enough tosecure SWRCB staff concurrence with a formal request for a CDOextension that will be made to the State Board in 2015.

Discussions and negotiations continue under a tight timeline, since, for a

variety of reasons, we believe we need to have an agreement in draft earlyin 2015.

Of particular importance during these negotiations, however, is that we willaccept no penalties or other measures mandated by the SWRCB that resultin unfair or punitive impacts on ratepayers who have exceededconservation goals and who have no responsibility for the delay.


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