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MPRWA Minutes March 13, 2014

MPRWA Minutes March 13, 2014

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Published by L. A. Paterson
Monterey Peninsula Regional Water Authority, California American Water Monterey Peninsula Water Supply Project
Monterey Peninsula Regional Water Authority, California American Water Monterey Peninsula Water Supply Project

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MI NUTES

MONTEREY PENINSULA REGIONAL WATER AUTHORITY (MPRWA)
Regular Meeting
7:00 PM, Thursday, March 13, 2014
COUNCIL CHAMBER
580 PACIFIC STREET
MONTEREY, CALIFORNIA

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

Directors Absent: None

Staff Present: Executive Director, Legal Counsel, Authority Clerk

ROLL CALL

The meeting was called to order at 7:01 p.m.

PLEDGE OF ALLEGIANCE

REPORTS FROM BOARD DIRECTORS AND STAFF

There were no reports from Directors. Executive Director Cullem reported on changes to the
printed packet materials and questioned direction on how to proceed with Cal Am’s request to
reduce Surcharge 1 from 15% to 4.5% and extend the period of time it was charged. The
Directors requested he handle it administratively.

PUBLIC COMMENTS

President Della Sala invited public comment for items not on the agenda.
• Tom Rowley spoke to the Government Affairs Committee meeting where Nichole
Charles reported regarding SB 936. He requested re-ordering the agenda to take up
Agenda Item 8 first.
• Doug Wilhelm questioned the proposed reduced surcharge asking if it would increase
the total amount of money over the course of the loan. Executive Director Cullem
responded that it would not.
• George Brehmer advocated strongly for residents to take care of themselves and
encouraged individuals to obtain personal rain water and grey water catchment, and
other self sustaining water supply systems.
• Darby Mossworth spoke concerning future legislation that would allow unlimited
amounts of money to be contributed to elections.

APPROVAL OF MINUTES

On a motion by Director Pendergrass, seconded by Director Edelen, and carried by the
following vote, the Monterey Peninsula Regional Water Authority approved the minutes for both
January 30, 2014 and February 13, 2014.

AYES: 6 DIRECTORS: Burnett, Edelen, Kampe, Pendergrass, Rubio, Della
Sala
NOES: 0 DIRECTORS: None
MPRWA Minutes Thursday, March 13, 2014


Monterey Peninsula Regional Water Authority
Regular Meeting Minutes - Thursday, March 13, 2014
2
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None

1. January 30, 2014 Special Meeting
Action: Approved

2. February 13 2014
Action: Approved

AGENDA ITEMS

3. Approve and File Checks for the Period of February 2014.
Action: Approved

Authority Clerk Milton reported regarding checks processed during February 2014. Under public
comment David Lifland requested an update regarding reimbursement from the County of
Monterey and the Monterey Peninsula Water Management District, both which are still pending.
On a motion by Director Rubio, seconded by Director Kampe, and carried by the following vote,
the Monterey Peninsula Regional Water Authority approved to file the checks for the month of
February 2014

AYES: 6 DIRECTORS: Burnett, Edelen, Kampe, Pendergrass, Rubio, Della
Sala
NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None

4. Authorize Staff to Send Letter Nominating the Salinas and Carmel River Basins Study for
Funding Under the Bureau of Reclamation's FY14 Basin Study Program

Dave Stoldt, General Manager of the Monterey Peninsula Water Management District spoke to
the item which would focus on assessing long term climate change on the local water supply
from the Salinas and Carmel river basins. Mr. Stoldt requested a letter of support nominating
this study to the Bureau of Reclamation to accompany the application put forth by MRWPCA
and MRWMD. In closing, he informed the Directors he would not stay for Agenda Item 8 to
maintain the neutrality of the MPWMD. President Della Sala invited public comment on the item
and had no requests to speak.

On a motion by Vice President Burnett, seconded by Director Rubio, and carried by the
following vote, the Monterey Peninsula Regional Water Authority authorized staff to send a
letter nominating the Salinas and Carmel River Basins study for funding under the Bureau of
Reclamations’ FY 14 Basin Study Program.

AYES: 6 DIRECTORS: Burnett, Edelen, Kampe, Pendergrass, Rubio, Della
Sala
NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None
MPRWA Minutes Thursday, March 13, 2014


Monterey Peninsula Regional Water Authority
Regular Meeting Minutes - Thursday, March 13, 2014
3

5. Adopt Resolution Approving Brownstein Hyatt Farber Schreck, LLP (Brownstein) as Special
Counsel for the period January 1, 2014 through December 31, 2014, Authorize the Executive
Director to sign a Consent and Waiver of Conflict of Interest, and Authorize the President to
execute the agreement for legal services.

Executive Director Cullem spoke to the item regarding extending the legal services contract
through December 31, 2014 and authorize changing the firm from being the Authority’s
Attorney of Record to being Special Legal Council.
President Della Sala invited public comment on the item. Salfwat Malek questioned the total
cost of the contract. Mr. Cullem indicated the budgeted amount is not to exceed $194,000 for
2014.
Mayor Rubio questioned if there was any ability to align the contract with the fiscal year. Mr.
Cullem spoke to the administrative effort required to process, renew and track all contracts at
one time. Director Kampe spoke to the substantial costs for the legal services but defended the
costs by saying that these are substantial projects which require a large level of collaboration,
cooperation and perseverance and that this is a very modest budge considering the total cost of
the project. The Directors spoke in support Mr. McGlothlin's efforts and experience noting that
although expensive, his efforts saved rate payers over 120 million dollars between the
Settlement Agreements and through Governance Committee structure and participation of the
RFQ and RFP process.

On a motion by Director Edelen and seconded by Director Rubio, and carried by the following
vote, the Monterey Peninsula Regional Water Authority approved the staff recommendation and
adopted Resolution 14-02 Approving Brownstein Hyatt Farber Schreck, LLP (Brownstein) as
Special Counsel for the period January 1, 2014 through December 31, 2014, authorized the
Executive Director to sign a Consent and Waiver of Conflict of Interest, and authorized the
President to execute the agreement for legal services.

AYES: 6 DIRECTORS: Burnett, Edelen, Kampe, Pendergrass, Rubio, Della
Sala
NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None

6. Authorize Extension of Contract with the City of Monterey For Executive Director Services

On a motion by Director Rubio and seconded by Director Edelen, and carried by the following
vote, the Monterey Peninsula Regional Water Authority authorized extending the contract with
the City of Monterey for Executive Director services.

AYES: 6 DIRECTORS: Burnett, Edelen, Kampe, Pendergrass, Rubio, Della
Sala
NOES: 0 DIRECTORS: None
Authority Clerk Milton reported on the item requesting the Authority to authorize extension of
the contract for Executive Director services with the City of Monterey. President Della Sala
recused himself as mayor of the City of Monterey, the contracting agency. Vice President
Burnett invited public comment on the item and had no requests to speak. The Directors spoke
to the outstanding job Mr. Cullem has been doing.
MPRWA Minutes Thursday, March 13, 2014


Monterey Peninsula Regional Water Authority
Regular Meeting Minutes - Thursday, March 13, 2014
4
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None

7. Adopt Financial Policies and Procedures


On a motion by Director Edelen and seconded by Director Kampe, and carried by the following
vote, the Monterey Peninsula Regional Water Authority adopted the presented Financial
Policies and Procedures as amended.

6 5 DIRECTORS: Burnett, Edelen, Kampe, Pendergrass, Rubio, Della
Sala
NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None

8. Receive Report, Discuss and Provide Direction Regarding Issues, Implications of
Commissioning a Study Regarding a Public Take Over of Cal Am.

Executive Director Cullem began the item by informing the Directors of the discussion which
occurred during the February 3, 2014. Water Authority TAC meeting which discussed the
issues and implications of commissioning a study regarding a public acquisition of Cal Am and
recommended that the Authority first consider if the issue was appropriate for consideration and
authority under the formation agreement, and second, how the action may be interpreted by
state agencies, as well as any impact on future bond funding. Mr. Cullem outlined the following
four options for consideration should the Water Authority decide to consider conducting a study
of an acquisition of Cal-Am:

1. Commission a study of a public takeover of Cal-Am with the intent to provide information
prior to a vote by the public.
2. Commission a study of a public takeover of Cal-Am with the intent to provide a Water
Authority recommendation prior to a vote by the public.
3. Defer consideration of study until some undetermined time after a vote by the public.
4. Determine that commissioning a study of the subject is outside the purpose of the Water
Authority.
President Della Sala invited public comments on the item.
Executive Director Cullem provided the report and recommended adopting a policy that more
clearly outlines the procedures and operations with regard to financial operations for the
Authority. Director Kampe requested adding language to the whistle blower policy to report to
the President and/or Vice President any concerns.
MPRWA Minutes Thursday, March 13, 2014


Monterey Peninsula Regional Water Authority
Regular Meeting Minutes - Thursday, March 13, 2014
5

• Tom Rowley, Nelson Vega, John Narigi and Rick Heuer said the public needs correct
facts regarding the impacts if the ballot measure passes and spoke in support of the
study.
• Safwat Malek and Mike Baer spoke in support of publicly owned water utilities in the
county and expressed concern regarding costs and the PUC.
• Phil Wellman, Darby Mossworth, a citizen, Sal Cardinale, Melanie Krislock, Charlie
Check, Alan Ebels, Andrew Bell, Doug Whilhelm, John Hall, Dan Turner, George
Brehmer, Jay Rowland and Jessie Williams requested the Directors to support Public
Water Now and spoke against Cal Am.
• Dan Presser suggested having a public forum as a way to inform voters of Measure O.
• Kevin Tilden from Cal Am spoke to the comments regarding water spikes and requested
anyone who experiences a spike should contact customer service who will help
recognize the leak and fix it. If it is identified and fixed they are not penalized. He
indicated that all political advertisements paid for by cal am are clearly labeled and most
are not done at rate payer or customer expense. He urged an impartial, factual analysis
and spoke in support of the study.
• George Riley expressed disappointment regarding the TAC discussion of this item and
did not think that the staff report was objective or includes all the information available.
He spoke in support of Public Water Now and publicly owned water.
• David Lifland Spoke in support of public water but indicated that the community should
focus their efforts on obtaining a water source first.
• Ron Cohen Managing Director of Public Water Now spoke against the study indicating
the amount of money projected would only politicize the issue but not analyze it.
Public Comment was closed.

Director Edelen spoke to the Cease and Desist Order imposed and the requirement to find a
new water source and spoke to the challenges that the desal project is up against. He spoke in
support of the study, as an independent analysis from to provide factual information back to the
Board and the public.
Director Rubio spoke to the purpose of the Authority and to the need for non-biased, factual
information to help the voters understand the impacts of the Measure.

Director Burnett spoke to the TAC discussion on the item reiterating it was a regular, publicly
noticed meeting with an agenda distributed prior to the meeting and there was minimal public
participation. He spoke against comments that there was not an opportunities for proper or
equal debate. He spoke to the community debating water for generations and the Authority is
moving toward a decision. The TAC recommendation was for the Board to conduct an analysis
which focuses on the purpose of the Authority as written in the mission statement and listed the
reasons that this project falls within the scope of the authority.
MPRWA Minutes Thursday, March 13, 2014


Monterey Peninsula Regional Water Authority
Regular Meeting Minutes - Thursday, March 13, 2014
6

Director Kampe questioned the election dates and the ability to complete the project prior to the
election and then spoke to public sentiment of priorities presented 1.5 years ago within his
jurisdiction with the priority being sufficient water supply. He spoke in support of low cost water,
but noted it was more important is having sufficient water first. He lastly indicated that no matter
how objective the report is, it will always be viewed as partisan and also did not think that it
would be a wise use of money for timing purposes.
Director Pendergrass spoke against a study that the results will be taken as the Authority
position and will perpetuate skepticism. He spoke to the history of the failed desal project
which caused the formation of this group to provide governance of the public site. He reminded
the public of the concession by Cal Am to allow public oversight.
Vice President Burnett indicated we are operating in the realities of a water-constrained
environment faced with a regulatory guideline in the way the CDO was intended. This is not a
question of if we like or don't like Cal Am, it is about what will deliver a water supply solution to
have sufficient water, cost effectively with appropriate governance. He expressed fear that the
single greatest risk is losing the consensus that the community has built in the last two years.
This issue has the potential to be divisive enough to leave us in a position not to be able to
petition for a relaxation of the CDO because no project will be complete by January 1, 2016 and
the ramifications are severe because there will be no water supply, regardless of ownership.
Vice President Burnett then outlined the accomplishments of the Authority over the last two
years of its existence including the tenants of the Authority Governance committee and the
benefits it provides, the profit cuts achieved through the public financing work saving the rate
payers over 20 million dollars and then he spoke to the hurdles yet to come.
The Directors discussed their authority and weather the public would be better served by the
Authority taking a position or if the public would be better served by laying out impartial, factual
information. The Directors spoke against the study due to timing, unknown true cost charged
back to the member jurisdictions and many will not change their minds based on the report and
suggested taking a position as peninsula mayors.

On Motion by Director Rubio and seconded by Director Pendergrass and passed by the
following vote the Authority directed staff to write up and bring back for approval a document
which outlines the Authority position opposing ballot Measure O, described this evening, and
verify the legal ability to take such a position.
AYES: 6 DIRECTORS: Burnett, Edelen, Kampe, Pendergrass, Rubio, Della
Sala
NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None

President Della Sala adjourned the meeting to recess at 10:09 p.m.

9. Receive Report, Discuss and Provide Recommendation on the Status of Monterey Peninsula
Water Supply Project
MPRWA Minutes Thursday, March 13, 2014


Monterey Peninsula Regional Water Authority
Regular Meeting Minutes - Thursday, March 13, 2014
7

The meeting reconvened at 10:14 p.m. Executive Director Cullem provided an update on the
status of the borehole construction project noting the second bore hole drilling was about to
begin and the results of the water analysis will be released once certified. He then spoke to the
power purchase agreement status and indicated the report regarding the capital costs of the
engineering solution will be published by the end of march. He further reported on the slippage
being reflected in the CPUC schedule reflected as a total 6-month delay being imposed by the
CPUC.
The Directors discussed the timeline and indicated that the City of Marina’s ultimate approval
sped up the process by months and should be recognized and that the schedule as presented
is doable unless something else delays the project. President Della Sala invited public
comment on the item.
• Tom Rowley expressed concern regarding lack of data in the draft EIR from the test
slant wells indicating since it is new technology it will be challenging and will invite
criticism. Suggested having the TAC review.
• David Lifland requested getting Point Blue to sign off on a well, requested an update on
the remaining reports due to the City of Marina and asked if the Authority should or
could intervene.

Ian Crooks, Engineering Manager for Cal Am spoke to the issue of getting viable slant well
technology and reported that nearly all reports due to the City of Marina have been completed
and the consultant will have a draft MDNA ready in April for public review. Chair Burnett
indicated that if there is any desire by the Board for additional review or analysis of the Draft
EIR, or the issue of brine disposal it should be agendized in the near future.

ADJOURNMENT

Meeting was adjourned at 10:33 p.m.

ATTEST:





Lesley Milton, Authority Clerk Chuck Dells Sala, President

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