FINAL MINUTES Special Meeting Board of Directors Monterey Peninsula Water Management District April 22, 2004

The meeting was called to order at 7 PM in the District conference room. Directors present: Alvin Edwards, Chair – Division 1 Larry Foy, Vice Chair – Division 5 Judi Lehman – Division 2 Kristi Markey – Division 3 Michelle Knight – Division 4 David Pendergrass – Mayoral Representative Directors absent: David Potter – Monterey County Board of Supervisors General Manager present: Fran Farina District Counsel present: David C. Laredo The assembly recited the Pledge of Allegiance. No comments were directed to the Board during Oral Communications. Director Foy offered a motion that was seconded by Director Pendergrass to adopt the staff recommendation and approve the CEQA Findings and the first reading of Ordinance No. 109 with the following clarifications and amendments: (a) page 10 of the ordinance, section 9, line 5, delete the reference to 30^th day; (b) page 11 of the ordinance, section C.3, line 5, delete the words “up to”; (c) page 15 of the ordinance, section C.3, line 4, delete the words “up to”; (d) page 12 of the ordinance, section 6, line 5, delete the reference to “actual” water use in accordance with the SWRCB determination regarding calculating water use by fixture unit method; (e) page 16 of the ordinance, section D, paragraph 3, line 9 delete the reference to “actual” water use; (f) page 20 of the ordinance, section 5, sentence 7, delete the reference to 15^th day and eliminate the reference to email notification; (g) page 27 of the ordinance, Section Five, paragraph (c), line 6, the words “one or more components” shall remain; (h) the phrase “within a specified period of time acceptable to MPWMD” shall remain on pages 28, 29 and 31; and (i) page 30 of the ordinance, second paragraph, line 4, delete the word “actual.” Director Knight proposed an amendment that language presented in Section Five on page 28, paragraph 3, lines 2 through 7, should be removed from pages 24, 30 and 31. District Counsel could include that language in the supplemental agreements where necessary. Directors Foy and Pendergrass accepted the amendment. Director Lehman proposed the following amendments: (a) page 20 of the ordinance, paragraph 5, line 7, should refer to the “15th” day following service of the notice; (b) the phrase “within a specified period of time acceptable to MPWMD” on pages 28, 29 and 31 shall be amended to specify a 15 or 30 day time period; (c) the phrase “up to” should remain part of the ordinance on page 11, section C.3, line 5; and page 15 of the ordinance, section C.3, line 4; and (d) add language to the ordinance before Section Eight which states that if there is no performance within 18 months and commencement of construction within 12 months thereafter, than these agreements and the ordinance should become void. Of these proposed amendments, items (a), (c), and (d) were accepted by Directors Foy and Pendergrass. The motion to approve the CEQA findings was approved on a vote of 4 – 2. Directors Edwards, Foy, Knight, and Pendergrass voted in favor of the motion. Directors Lehman and Markey were opposed. Director Potter was absent. The motion to approve Ordinance 109 with amendments was approved on a vote of 4 – 2. Directors Edwards, Foy Knight and Pendergrass voted in favor of the motion. Directors Lehman and Markey were opposed. Director Potter was absent. The following comments were directed to the Board during the public hearing on this item. (1) Thomas Jamison, representing the Pebble Beach Company (PBCo), requested that the following changes be made to Ordinance No. 109. (A) Amend the ordinance to reflect the State Water Resource Control Board’s (SWRCB) determination by letter dated April 21, 2004, (on file at the District office) that it is not opposed to the continued use of the “fixture unit” method of estimating water use for the unused portion of the 380 acre-feet of potable water entitlement. (B) Page 10 of the ordinance, section 9, line 5, recommend deletion of reference to 30^th day and delete reference to notification by email. (C) Page 12 of the ordinance, section 6, line 5, delete the reference to “actual.” (D) Page 15 of the ordinance, section C.3, line 4, the reference to “up to” could be deleted. (E) Page 16, section D, paragraph 4, line 3, words “which purports to authorize” should remain. (F) Page 20, section 5, line 7, delete reference to 15^th day and delete reference to email notification. (G) Page 24, first paragraph, bracketed text in lines 10 through 16, should be deleted. However, similar language in Section 5 of the ordinance is appropriate. (H) Page 27, paragraph (c) line 6, reference to “one or more components” should remain in document. (I) Page 28, line 1, specify 30 days after the effective date, or leave language as presented and incorporate more specific requirements into the supplemental agreements. (J) Delete language in Sections Six and Seven that refer to payment of costs associated with monitoring the water entitlement. Mr. Jamison stated that there were no substantive issues that would prevent PBCo from reaching consensus on the supplemental agreements. (2) Lloyd Lowrey, representing the Independent Reclaimed Water Users Group (IRWUG), referred to comments outlined in a letter to the Board dated April 20, 2004 (on file at the District office). (3) George Thatcher, representing CAWD and PBCSD, expressed satisfaction with the ordinance as written. He requested that references to notification by email be deleted. Mr. Thatcher also asked that on page 20 of the ordinance, section 4, line 2, the words “30 days” remain unchanged. In addition, on page 27 of the ordinance, section (c), line 6, the words “one or more components” should remain unchanged. (4) David Dilworth, representing Helping Our Peninsula’s Environment (HOPE), expressed opposition to the proposed expansion of the recycled water project and adoption of Ordinance No. 109. According to Mr. Dilworth, the CEQA review presented for Ordinance No. 109 was out of date. He submitted written comments in a letter dated April 22, 2004 (on file at the District office). In addition, Mr. Dilworth submitted a copy of a letter dated March 23, 2004 from Robert W. Floerke, California Department of Fish and Game, that contained comments on the Pebble Beach Company Del Monte Forest Preservation and Development Plan Draft EIR. Mr. Dilworth proposed that all water distributed from the reclamation project should be measured by actual use, not by the fixture unit method. He chastised the project proponents for limiting use of the water to the Del Monte Forest area, in order to avoid preparation of an expanded environmental review. (5) Alan Williams, representing PBCo, stated that 390 acre-feet of water from the reclamation project are allocated to environmental uses. He maintained that the project expansion should result in an excess of 800 acre-feet of reclaimed water for use on golf courses, which could be used to offset additional potable golf course water use. He noted that PBCo did offer 40 acre-feet of water for use outside of the Del Monte Forest, but the District did not accept that proposal. Mr. Williams stated that PBCo would consider allocation of the 40 acre-feet of water in the future, but not in conjunction with the present discussion on Ordinance No. 109. The meeting was adjourned at 9:10 PM.

CALL TO ORDER/ROLL CALL PLEDGE OF ALLEGIANCE ORAL COMMUNICATIONS PUBLIC HEARINGS 1. First Reading of Ordinance No. 109 – Revising Rule 23.5 and Adopting Additional Provisions to Facilitate the Financing and Expansion of the Carmel Area Wastewater District (CAWD)/Pebble Beach Community Services District (PBCSD) Recycled Water Project A. Review CEQA Findings B. Review Supplemental Financing Agreement C. Review Supplemental Operation and Construction Agreement D. Review Agreement for Sale of Recycled Water ADJOURNMENT

__________________________________ Fran Farina, Secretary to the Board

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