M I N U TE S MONTEREY PENINSULA REGIONAL WATER AUTHORITY (MPRWA) Regular Meeting 7:00 PM, Thursday, August 8, 2013 580 PACIFIC STREET MONTEREY

, CALIFORNIA Directors Present: Directors Absent: Staff Present: ROLL CALL PLEDGE OF ALLEGIANCE President Della Sala called the meeting to order at 7:00 p.m. Alternate Director Talmage was attending in Vice President Burnett's absence. REPORTS FROM BOARD DIRECTORS AND STAFF Executive Director Cullem stated that the success of the three California Public Utilties Commission settlement agreements was achieved primarily through the efforts of Vice President Burnett, TAC Member Dave Stoldt, and Legal Counsel Russ McLaughlin. Mr. Cullem read the list all of the parties who signed the final settlement agreement as proof of a great diversity of interests that came together in agreement. Signatories of the largest agreement included:
• • • • • • • • • • • • • • • California-American Water Company Citizens for Public Water City of Pacific Grove Coalition of Peninsula Businesses County of Monterey Division of Ratepayer Advocates Landwatch Monterey County Monterey County Farm Bureau Monterey County Water Resources Agency Monterey Peninsula Regional Water Authority Monterey Peninsula Water Management District Monterey Regional Water Pollution Control Agency Planning and Conservation League Foundation Salinas Valley Water Coalition Sierra Club Surfrider Foundation

Edelen, Kampe, Pendergrass, Rubio, Talmage, Della Sala Burnett Executive Director, Legal Counsel, Clerk

Signatories of the second agreement included:
• • • • • California-American Water Company Citizens for Public Water City of Pacific Grove Coalition of Peninsula Businesses

MPRWA Minutes
• • • • • Division of Ratepayer Advocates Monterey Peninsula Regional Water Authority Monterey Peninsula Water Management District (“MPWMD”), Monterey Regional Water Pollution Control Agency Planning and Conservation League Foundation

Thursday, August 8, 2013

PUBLIC COMMENTS President Della Sala invited public comment for items not on the agenda. Tom Rowley spoke as a citizen regarding a recently published article he felt was misleading. Additionally, he was disappointed that Land Watch and the Sierra Club were not signatories to the final settlements. He encouraged the Authority to communicate potential major hurdles for the project and to emphasize there is still a lot of work to do. Dean Province introduced himself and indicated that he will be running for a position on the Water Board, Division One. Having no further requests to speak, public comment was closed and President Della Sala responded to Mr. Rowley’s comments agreeing that there is more work to do but that the public should also know what has been accomplished to date. APPROVAL OF MINUTES 1. July 25, 2013 Clerk Milton requested one correction to the draft minutes. On a motion by Director Rubio, seconded by Director Kampe, and carried by the following vote, the Monterey Peninsula Regional Water Authority approved the minutes of July 25, 2013 as amended. AYES: NOES: ABSENT: ABSTAIN: RECUSED: 5 0 0 1 0 DIRECTORS: DIRECTORS: DIRECTORS: DIRECTORS: DIRECTORS: Edelen, Kampe, Pendergrass, Rubio, Della Sala None None Talmage None

AGENDA ITEMS 2. Receive, Discuss and Provide Recommendations on Opinion Editorials Published and Future Opinion Topics Executive Director Cullem spoke to the item and clarified the process staff used to vet the articles prior to publication. He reported that the first article focused on the Authority, its responsibilities, and Cal Am’s efforts on complying with the Cease and Desist Order (CDO). The second article pertained to the settlement process and meeting the four basic and eight specific criteria imposed upon the Monterey Peninsula Water Supply Project. Mr. Cullem requested direction for additional articles topics and answered questions from the Directors.

Monterey Peninsula Regional Water Authority Regular Meeting Minutes - Thursday, August 8, 2013 2

MPRWA Minutes

Thursday, August 8, 2013

Director Rubio requested that a table be created for the benefit of the public connecting the policy document and the settlement agreements. Director Talmage suggested similar momentum and focusing on topics such as next steps, GWR, or financing. He also suggested that the website include a representative sample of articles published regarding the water supply solution to give a sense of history. The Directors agreed to include a representative variety of articles published regarding the water supply solution on the Authority website. President Della Sala opened the item to public comment. Sue McCloud spoke to her experience of developing propaganda for government agencies. She suggested the following tactics: • • • • • • Always have a document available as a “Take Away” with the information presented to refute converse articles. In determining marketing pieces answer; “What does the rate payer want to know? How much will it cost me? How much water will I be allowed to have?” Royal Calkins from the Monterey Herald should be thanked for publishing so many water articles. Discourage joint statements from other agencies and encourage the Authority to keep its independence. All messages should be indicate the challenges still to be overcome. Inform the public of impacts on a personal and community level if there is no water solution by 2016 and that it is not an issue of supply, but of storage.

Tom Rowley spoke representing the Monterey Peninsula Taxpayers Association in agreement with Ms. McCloud that there are no quick solutions. Having no further requests to speak, President Della Sala closed public comment and he then responded for the public's benefit that recent projections have concluded that if there is not an adequate water supply in place by the cease and desist order deadline, and the community is forced to ration, it would generate a loss of 6,000 jobs in the region with an economic impact of over $1 Billion dollars. The success for bringing a water supply online is important or it will devastate our community. He closed by saying the Authority will consider the tactics suggested by the public and try to incorporate into the education method. 3. Receive Report, Discuss, and Provide Recommendations Regarding Trip to Poseidon Desalination Facility Executive Director Cullem reported on a trip to the Poseidon Desalination facility in Carlsbad, CA and noted that one of the largest challenges the project was confronted with was brine disposal.

Monterey Peninsula Regional Water Authority Regular Meeting Minutes - Thursday, August 8, 2013 3

MPRWA Minutes Additional Notable Points from the Tour: • • • •

Thursday, August 8, 2013

• • •

Poseidon is a privately owned enterprise, a private venture A study will be forthcoming regarding the brine discharge systems. - The current proposed brine discharge outfall may be the most impacting to the marine environment. Costs: For the pipeline infrastructure Poseidon funded $200 million, Cal Am’s proposed cost is $100 million Public Financing – Poseidon utilized tax exempt private activity bonds under 5%, with an equity position at 18%, while Cal Am is 27%. Note: Poseidon did not have access to public funding Storm Water Inflows: Biggest issue is silt San Diego Water Authority was able to secure funding through pipeline bonds Built into the agreement was a buyout option after ten years at a set price. After 30 years, the ability to sell to Public for $1. The facility produces 56 million gallons per day, which is only 10% of the water supply for the region. The local project will provide 60% of the water supply to our community.

Mr. Cullem suggested to agendize at a future meeting a discussion of how to address or prevent a big ticket mitigation requirement and then answered questions from the Directors. President Della Sala opened public comment and had no requests to speak. President Della Sala noted that the Poseidon facility is six times larger than the proposed Cal Am facility, therefore the costs are not comparable for operations. The unit cost per water should be much cheaper for a larger plant. He and Director Talmage agreed that source water is the most important factor yet to be determined for the success of the project, but the ratepayer’s the most important factor is cost. ADJOURNMENT Having no further business to conduct, the meeting was adjourned at 7:58 p.m.

ATTEST:

Lesley Milton, Clerk of the Authority

Chuck Della Sala, MPRWA President

Monterey Peninsula Regional Water Authority Regular Meeting Minutes - Thursday, August 8, 2013 4

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