M I N U TE S

MONTEREY PENINSULA REGIONAL WATER AUTHORITY (MPRWA)

Regular Meeting
7:00 PM, Thursday, August 13, 2015
COUNCIL CHAMBER
580 PACIFIC STREET
MONTEREY, CALIFORNIA
Directors Present:
Directors Absent:

Edelen, Burnett, Kampe, Pendergrass, Rubio, Alternate Director Downey

None

Staff Present:

Executive Director, Legal Counsel, Clerk

ROLL CALL
Vice President Kampe called the meeting to order at 7:00 PM.
President Burnett called in from a noticed location.
Alternate Director Downey was present for Director Roberson.
PLEDGE OF ALLEGIANCE
REPORTS FROM BOARD DIRECTORS AND STAFF
Vice President Kampe invited reports from the Board and Staff.
Executive Director Cullem reported that the Authority previously considered the final routing of
the pipelines as part of the DEIR for the Monterey Peninsula Water Supply Project (MPWSP)
and subsequently the City of Monterey sent a letter to the CPUC requesting consideration of a
third alternate, less intrusive route. Additionally, he announced that Keith Van Der Matten was
appointed the General Manager of the Marina Coast Water District and is now a representative
on the TAC. He then reported that the letter to the CPUC regarding the Geo Science conflict
approved the 29th of July was mailed on July 30th. Lastly, he provided a letter to the Directors
from resident Bill Hood, to Cal Am General Manager Rob MacLean as a letter of public input.
PUBLIC COMMENTS
Vice President Kampe invited public comments

George Riley expressed concern that the test well time period be too short for valuable
information and requested the Sand City pumping data be considered.
Tom Rowley, said the reason the Authority has been successful is that they approach all
issues from an independent perspective and urged the Board to take up the issue Mr.
Riley discussed.
An individual presented an alternative to the pipeline route to reduce impacts to traffic
and neighborhood.
Doug Wilhelm congratulated the Mayors for undertaking a review of the deal projects.
He hoped it was not just a show for the CPUC to prove the viability of Cal Am. He
requested agendizing a presentation on the Poseidon desalination facility.

CONSENT AGENDA

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Executive Director Cullem requested tabling Item #4 because no updated schedule is available.
On motion by Director Pendergrass and seconded by Director Rubio and approved by the
following roll call vote the Authority Directors approved Consent Agenda Items 1 through 3 and
tabling Item 4.
1.

Approve the Minutes of July 9, 2015 Regular Meeting

Action: Approved

2.

Approve the Minutes of July 29, 2015 Special Meeting

Action: Approved

3.

Approve and File Checks

Action: Approved

4.

Receive the Most Recent Update of the California Public Utilities Commission (CPUC)
Schedule for the Monterey Peninsula Water Supply Project
Action: Tabled
AGENDA ITEMS

5.

Receive an Update on the Summary Project Schedule for the Monterey Peninsula Water
Supply Project (MPWSP), including Status of the Application to the Coastal Commission for an
Amended Coastal Development Permit (CDP) to Resume Slant Test Well Operations, Receive
Responses to Questions Provided to California American Water Company on July 29, 2015,
Review the Table of Permits and Approvals, and Approve a Letter to Cal Am With Regard to
Slant Well Financial Risk
Ian Crooks from Cal Am provided an update on the latest project schedule for the Monterey
Peninsula Water Supply Project (MPWSP), which reflected what is known in the EIR at this
time. He detailed the schedule of the pipeline and thinks the construction can be done in 15-18
months and that Cal Am is working with the Design Build firm for efficiencies. Should be
breaking ground mid-2017. He then reported on the status on the application for the test slant
well. He then spoke to the responses to the questions posed by the Authority which were also
included within the agenda packet. Mr. Crooks invited questions regarding the responses.
Mr. Crooks also supplied and explained a table of permits that are anticipated as necessary for
the MPWSP project, delineated by state, federal and local permitting agencies. Also included
in the schedule necessary key documentation and the purpose of the permit. He reported
working with the TAC to review the permits in a Gant schedule noting many permits cannot be
completed until the CEQA/NEPA process is complete, but work can be done in anticipation. He
indicated that the Authority can assist with the anticipated schedule and assist with working with
the following agencies:

FORA regarding the terminal reservoir

The City of Seaside for the transfer of land
TAMC regarding acquiring utility easements
Other local permits from the individual cities.

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Executive Director Cullem spoke to the draft letter prepared to send to Mr. MacLean regarding
the financial guarantee project slant wells. President Burnett added that the notion of the letter
is asking Cal Am to guarantee that if the test well and does not turn into a production well, that
the community would not need to pay for it. It's not appropriate for the community to bear the
full risk and costs.
Vice President Kampe invited comments from the public.

George Riley agreed with President Burnett citing concerns regarding stranded costs he
requested the Authority ask Cal Am to extend the time period for the test wells.
Mr. Check expressed concern regarding the Dana Point well data that the amount of
iron and manganese will impacts production. He expressed concern that there is no
chemical testing occurring which could have impacts to the operation of the plant.
Jan Schriner speaking as a resident and not as a Board Member of the MCWD, liked
the direction of the letter, and wanted to see if there was a rate of return based on
production instead of just the investment.
Nelson Vega thinks Mr. Check's point is valid, but we don't know the full story about
Dana point. He also requested consideration of private companys rights if they take a
risk, they should get a return and that if we ask them to take on risk, we should be
willing to share risk. Please dont lose sight of the goal to get the best price per acre
foot.

Director Edelen spoke to the regulatory hoops that are being required to jump through, are all
self-inflicted by the State government. He spoke to a desal plant in the Middle East and that did
not destroy the environment. Director Rubio spoke to his previous comment that baseline data
should have been collected for a variety of reasons, and in regards to the letter, it is a good
idea and it should be sent but at the same time the risk is already being shared by the
community in many ways. Alternate Director Downey thought the questions and answers
provided are interesting, but expressed frustration that many responses actually had no
answers. She does not want to pay for mistakes, but encouraged moving quickly when there is
a deadline.
Director Pendergrass motioned to authorize sending the proposed letter to Cal Am. It was
seconded by Director Edelen.
President Burnett requested a modification to the motion adding in the notion of stranded costs,
and inclusion of comments with pumping efficiencies. The amendments to the motion were
accepted.
The Authority Board discussed the Sand City intake and the efficiencies, water quality testing
results and the CPUC interpretation of the test wells if they would be considered stranded costs
and cannot be recovered or if it is a necessary project request and can be recovered.
On motion by Director Pendergrass and Seconded by Director Edelen and passed by the
following vote, the Authority Board approved the inclusion of stranded costs into the letter with
the same tone and principal of the draft letter, based on the discussion and authorized staff to
send the revised letter to Cal Am.

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6.

Thursday, August 13, 2015

Receive Report, Discuss, and Provide Direction on Final Application to the State Water
Resources Control Board (SWRCB) for a Cease and Desist Order (CDO) Extension Request,
and Authorize the Authority President to Send a Comment Letter to the Board Staff on Its Draft
Response to the Cal Am Draft CDO Application
Executive Director Cullem spoke to the previous discussions of this item and indicated a draft
response has been received on the draft application. Progress has been made but further
review and modifications are need which will be brought back to the Authority in the future.
Secondly, Mr. Cullem requested the Board to authorize President Burnet to send a comment
letter with respect to the draft responses to the State. Director Rubio expressed concern that
the Authority has not agreed with drafting a combined letter with Cal Am and the Water
Management District. His second concern is that before authorizing the comment letter, he
wants to see the draft responses and this item is too premature.
Vice President Kampe invited comments from the public.

Ron Witezman questioned why we want to fine the rate as opposed to Cal Am.

Tom Rowley agreed with Mayor Rubio regarding a co-petition citing that that the
independence of the Authority is crucial to the long term accomplishments.

George Riley spoke in agreement of Mr. Rowley and Mr. Weitzman

John Narigi representing the Coalition of Peninsula Businesses, pleased with the
outcome of the final document but remains concerned regarding fault imposed for
missing the milestones. He spoke in support of unification of the Authority and the
District as long as it does not impact the protection of the community.
Jan Shriner speaking as a Marina resident spoke to the confusion of the role of
government vs business. Urged being careful of resenting state government for
protection of people's resources.
Nelson Vega spoke in support of Mr. Narigi and Director Rubio to maintain
independence.
Michael Baer expressed concern that the Authority is assuming risk by co-signing and
that it is contradictory to the letter they discussed previously.

Director Rubio reiterated that before authorizing to send a comment letter he requested to see
the letter and requested to continue both of the items.
On motion by Alternate Director Downey and seconded by Director Rubio and passed by the
Following roll call vote the Authority Directors continued the item until more information is
available.
7.

Approve a Letter from the Water Authority to the Marina City Council Inviting Marina to Name a
Non-voting Hydrogeologist to the MPWSP Hydrogeological Working Group (HWG)
Executive Director Cullem spoke to the item detailed within the letter provided in the packet.

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Vice President Kampe invited Comments from the public.

Mark Baer spoke in support of allowing marina who will be impacted by the desal plant,
and questioned Mr. Williams representation.

Ron Weitzman questioned why the City of Marina and not Marina Coast Water District.

Jan Shriner agreed with Mr. Weitzman's question and encouraged someone with
historic information to help the CPUC understand, so there are no inaccurate
assumptions made.

President Burnett answered the question about extending the invitation to the City of Marina
because they are the permitting agency and it will benefit the Authority having the permitting
agency involved to address questions early on and avoid permitting delays down the road. He
then indicated Dennis Williams now represents Cal am, no longer the CPUC.
Director Downey questioned the paragraph that Marina can charge Cal Am and questioned the
intent of the statement. Director Kamp requested changing on the wording of that sentence to
eliminate "as long as the participation facilitated" and substitute with ______.
On motion by Alternate Director Downey and seconded by the Director Edelen and passed by
the following vote, the Authority Directors accepted the letter with the recommended changes.
5-0-1, Pendergrass voted no.
Director Pendergrass did not agree with the motion as it complicates the process and doesnt
think it is the right way to go.
8.

Receive Presentation, Discuss, and Provide Staff Direction on the Deep Water Desal Project
Executive Director Cullem provided procedural instructions on how the presentations would be
facilitated.
David Armanasco from Deep water Desal began by explaining theyre not in competition with
Cal Am but are a regional water solution for the Monterey area. He also shared that the State
Lands Commission is the lead agency for the DWD EIR and the Monterey Bay National Marine
Sanctuary is the lead for the EIR. He assured the Directors that there is enough demand for this
project without the Monterey Peninsula and the project continues to move forward. He noted
that Jim Heitzinger, legal counsel was present in the audience and can respond to permitting
questions. He then introduced the General Manager of Deep water Desal, Kim Adamson who
provided the presentation. He spoke to her qualifications.
Ms. Adamson, spoke to their role as the back-up option for the WMD, they felt it was important
to do. She also clarified that there is no competition between projects. She provided a project
overview/features detailing the desalination process, potential offtakes and explained the intake
and outfall strategy as well as the project schedule, the public/private partnership models and
financing and then highlighted the risks and contingencies for the project. She indicated that
DWD has already done many of the required preliminary reports that will be required for the
EIR so their timeline is extensively truncated.
Vice President Kamp recessed the meeting at 9:06 PM. The meeting was reconvened at 9:16
PM and Mr. Kampe invited public comment on the item.

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Mark Baer questioned the pipeline and the easement agreements for intake.
Ron Witezman requested clarification that they have an NOI and not a NOP.
Ms. Adamson responded to public comments that easements and permits for intake piping and
easements related to the Harbor District. She indicated the Harbor District said they would work
with them in fair dealings. They are going through Dynagy easements and confirmed that they
did an NOP according to the State Lands Commission.
Director Rubio questioned the estimated costs per acre foot and asked if that included a
conveyance costs, and in the offtakers risk to which Ms. Adamson responded she does not
have pipeline estimates for the pipeline route to the Peninsula. No cost estimates are available
but they are comparable. Alternate Director Downey questioned the total investment required
and Ms. Adamson indicated they are not ready right now and it would be shared with potential
customers and partners based on specific parameters. Director Edelen questioned how difficult
would it be to increase demand for this project in the future to which Ms Adamsan said there
may be redundancies built in for future growth but growth was not included in the existing EIR.
Vice President Kampe questioned Monterey County's requirement to have public ownership of
desal projects to which the first model falls under that ordinance and the second copies the Cal
Am project model. Legal Counsel Heitzinger responded that the ordinance will have to be
reinterpreted or changed to allow. This model would reduce the risks discussed earlier, and
believes that depending on the partner, it could significantly reduce the cost of water because it
will reduce the cost of debt and there are public policy reasons that they may want to reinterpret
their ordinance differently.
Executive Director Cullem indicated the Kennedy Jenks Study included costs and is available to
the Board and the TAC, which includes cost information, although somewhat dated. The
Directors thanked DWD staff for their presentation.
9.

Receive Presentation, Discuss, and Provide Staff Direction on the Peoples Desal Project
David Balch with the People's Moss Landing Desal project indicted that the largest differences
between the two projects is in the intake and the intake structure. Mr. Balch provided overview
of the project including the goals and objectives, the rehabilitation of existing infrastructure, the
existing water demands and needs, proposed project description, overview, the environmental
review process and their draft schedule. He indicated that the project is designed to serve North
Monterey County, and does not include growth and cited this project as being the simplest
project due to all existing infrastructure. Project Hurdles include project financing, long term
and short term, pending litigation in foreclosure of the property, but indicated that they are
working with investors, easements with the Harbor Master as the outfall pipeline easement
needs to be extended due to the expiration. Mr. Balch answered questions of the Board.
Vice President Kampe invited comments from the public.

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Tom Rowley spoke to the need for a back-up project and it's good to hear other projects
are moving forward.
Mr. Chevk agreed for the need for a back-up but also to create competition.
John Narigi agreed with competition but expressed concern regarding no information
about the cost of the project. He suggested the Authority resend the 8-9 questions and
request the alternative projects to answer them factually and specifically.
George Riley spoke to the SPI reports that Cal Am had a schedule advantage and since
the advantage is gone we should be addressing who can get there the quickest and to
ignore other projects is missing an opportunity.
Ron Witesman dont be afraid of Cal Am they will not cut off our water Cal am.
Mark Baer it was a horse race for the regional failed project, let it continue.

Director Rubio expressed frustration with gaps and non-answers in terms of cost conveyance
and until we can compare with specifics, he finds it hard to make an informed decision.
The Directors thanked Mr. Balch for the presentation and acknowledged there is more to learn
about all of the alternative projects.

ADJOURNMENT
The meeting adjourned at 10:09 PM.

ATTEST:

Lesley Milton-Rerig, Clerk of the Authority

Bill Kampe, Authority Vice President

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