MPWMD BOARD MEETING--MAY 17, 2004--FINAL MINUTES

FINAL MINUTES

Regular Meeting

Board of Directors

Monterey Peninsula Water Management District

May 17, 2004

The meeting was called to order at 7:08 PM in the Monterey City Council Chambers.

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

David Potter – Monterey County Board of Supervisors (arrived at 7:30 PM)

Directors absent: None

General Manager present: Fran Farina

District Counsel present: David C. Laredo

The assembly recited the Pledge of Allegiance.

The following comments were directed to the Board during Oral Communications. (1) David Dilworth, representing Helping Our Peninsula’s Environment (HOPE), read an undated letter now on file at the District office. He requested that the May 27, 2004 Special Board meeting scheduled for discussion of Ordinance No. 109 be conducted at the Monterey City Council Chambers so the meeting can be televised. According to Mr. Dilworth, an EIR should be prepared on Ordinance No. 109. (2) Sheryl McKenzie, Government Affairs Director for the Monterey County Association of Realtors (MCAR), submitted a letter dated April 28, 2004 that was signed by Jean Manner Schwimmer, President of the MCAR. She thanked the Board for voting to reinstate the credits for the micro-flush toilets and for clarifying amendments to two ordinances that allow for some flexibility for residential property owners. She requested that Ordinance No. 60 be amended to eliminate a requirement that water credits expire after 10 years. (3) Lorna Torkos, a resident of Pacific Grove, requested that District staff review the water permit for the proposed Pacific Grove Golf Course Club House and ensure that the amount of water requested for the project is equal to the capacity of the building.

On a motion by Director Knight and second by Director Lehman, the Consent Calendar was approved on a vote of 6 – 0, except for Item 1 that was pulled for separate consideration. Director Potter was not present for the vote on this item.

On a motion by Director Knight and second by Director Lehman, minutes presented in the Board packet were approved, along with revisions to page 2 of the April 22, 2004 Board meeting minutes that were submitted by staff (on file at the District office). The minutes were approved on a vote of 6 – 0. Director Potter was not present for the vote on this item.

Approved.

Joe Oliver, Water Resources Manager, presented the Status Report. An outline of his presentation is on file at the District office. He reported that the District has injected 1,100 acre-feet of excess water from the Carmel River into the coastal area of the Seaside Basin. In 2003, 440 acre-feet of water were recovered and supplied to the California American Water (Cal-Am) system for customer use. The District has applied for permanent water rights for a long-term aquifer storage and recovery (ASR) project and is waiting on action by the State Water Resources Control Board (SWRCB). Staff is also developing plans and cost estimates for a second injection well. In addition, staff is coordinating with Cal-Am on ASR options as part of the proposed Coastal Water Project.

Director Potter arrived at 7:30 PM.

District Counsel Laredo reported that on April 28, 2004, the Board met in closed session to provide direction on recruitment of a General Manager. On May 3, 2004 the Board met again on recruitment issues; conducted a conference with labor negotiators on employee contract issues; and reviewed pending litigation on California-American Water versus the City of Seaside, Monterey Superior Court Case No. M66343. On May 17, 2004 the District met again to discuss recruitment issues; conduct a conference with labor negotiators on employee contract issues; and reviewed pending litigation on California-American Water versus the City of Seaside, Monterey Superior Court Case No. M66443.

At the request of Chair Edwards, Andy Bell, the District’s Planning and Engineering Manager/District Engineer, reported on the upcoming one-day workshop on desalination sponsored by Association of Monterey Bay Area Governments. The workshop is set for May 20, 2004 at the Monterey Beach Hotel.

Director Foy reported that he attended a one-day conference sponsored by the Public Officials for Water and Environmental Reform. The conference was titled Environmental Justice Framework for California Water and Desalination.

Director Markey requested that the May 27, 2004 public hearing on the second reading of Ordinance No. 109 be rescheduled to the June 21, 2004 Board meeting. The change would address concerns expressed by David Dilworth about access to the public hearing, and could signal an end to the scheduling of special Board meetings.

The Board discussed the draft budget and provided comments to staff. A revised draft budget will be presented at the June 21, 2004 Board meeting that incorporates the Directors’ comments. No action was taken on this item.

The following comments were directed to the Board during the public hearing on this item. (1) Robert Greenwood noted that one of the charts included in the presentation indicated the occurrence of several thousand-acre feet of illegal pumping. He asked if anything could be done to stop the illegal pumping. (2) David Dilworth, representing HOPE, recommended that funding for preparation of an update to the Allocation Program EIR and preparation of an EIR on a desalination project in Sand City should remain in the budget. He supported the idea of establishing a Water Distribution System Fee of $80 per acre-foot. (3) John Fischer, a resident of Pacific Grove, asked how projects that are being deferred would be funded in future years.

On a motion by Director Pendergrass and second by Director Knight, the Board unanimously received the Water Supply Forecast for May 1, 2004 through September 30, 2005 on a vote of 7 – 0.

Darby Fuerst, Senior Hydrologist, advised the Board that an error appeared on page 103 of the Board packet. Usable storage in the Monterey Peninsula Water Resources System was cited as 97 percent of maximum capacity, but that number is actually 83 percent of maximum capacity. He reported that usable water storage is sufficient to meet projected water demand through the end of Water Year 2005; therefore, mandatory water use restrictions are not required at this time. However, regulatory limits established in SWRCB Order 95-10 must be met. If Cal-Am water production from the Carmel River basin exceeds the May 2004 year-to-date water use projections, water users in the Monterey Peninsula Water Resources System will be subject to Stage 3 water use restrictions established by the Expanded Water Conservation and Standby Rationing Plan.

The following comments were directed to the Board during the public hearing on this item. (1) John Fischer, a resident of Pacific Grove, warned that the community is “in trouble” if water use is not reduced to the legal limit. (2) Steven Leonard, representing Cal-Am, stated that his staff has met with District representatives regarding the increase in water use. He noted that water production is 15 percent above the normal level for the month of May. According to Mr. Leonard, local golf courses have contributed to the increased water use due to the recent flushing of golf course greens. (3) David Dilworth, representing HOPE, attributed high water use to the 8,000 water permits that have been issued since 1977, including 3 water permits for golf courses. He asked how many water permits had been issued in the month of May and since January 1, 2004.

Director Potter made a motion to adopt the amended Implementation Guidelines as presented in the staff report. Director Lehman seconded the motion.

Director Markey suggested that language of the proposed amendment be modified further to state: “either (a) be reported to the General Manager on the Form for Disclosure of Ex Parte Communication, which shall remain part of the public packet at the hearing, or (b) be disclosed orally on the record of the proceeding, which shall be recorded in the minutes.” Director Potter accepted the amended language. The amended motion was approved on a vote of 5 – 2. Directors Edwards, Knight, Lehman, Markey and Potter voted in favor of the motion. Directors Foy and Pendergrass were opposed.

The following comments were directed to the Board during the public hearing on this item. (1) David Dilworth, representing HOPE, suggested that any disclosure made by a Director at the Board meeting should be recorded in the minutes of the meeting, and that any written disclosure or communications should be included in the Board packet or be made available at a public meeting. (2) Robert Greenwood agreed that any disclosure made by a Director at the Board meeting should be recorded in the minutes of the meeting.

Director Potter made a motion to approve the recommendation of the Rules and Regulations Committee that Ordinance No. 112 should not be adopted upon second reading. Director Markey seconded the motion, and it was approved on a vote of 5 to 2. Directors Edwards, Knight, Lehman, Markey and Potter voted in favor of the motion. Directors Foy and Pendergrass were opposed.

The following comments were directed to the Board during the public hearing on this item. (1) David Dilworth, representing HOPE, expressed opposition to adoption of the ordinance. (2) John Fischer spoke in opposition to adoption of Ordinance No. 112.

On a motion by Director Knight and second by Director Lehman, the second reading version of Ordinance No. 114 was adopted unanimously on a vote of 7 – 0.

No public comment was directed to the Board during the public hearing on this item.

Director Potter offered a motion to: (a) delete section 5.C.2. of the ordinance that requires ownership of a site for 24 months; (b) adopt the amended ordinance; and (c) refer the ordinance to the Water Demand Committee and request that the committee develop language that addresses the reuse of saved water for redevelopment projects to ensure that they can move forward without the 24-month ownership requirement. The amended version of the ordinance would be presented for Board consideration. Director Knight seconded the motion.

Director Markey offered an amendment to adopt the ordinance as presented and refer it to the Water Demand Committee to consider whether changes should be made to address the issue of redevelopment projects. There was no second to the amending motion.

The original motion was approved on a vote of 5 – 2. Directors Edwards, Foy, Knight, Pendergrass and Potter voted in favor of the motion. Directors Lehman and Markey were opposed.

During the public hearing on this item the following comments were directed to the Board. (1) David Dilworth, representing HOPE, recommended that Rule 25.5 C.2 should specify that the site must have been under current ownership for at least 5 to 10 years. (2) Kelly Morgan, representing the City of Sand City, expressed concern that the 24-month provision in Rule 25.5 C.2 would prevent the construction of redevelopment projects. (3) Thomas Jamison, representing DBO Development Company, spoke in support of comments made by Kelly Morgan. He also presented two graphics that depicted urban redevelopment areas in Sand City (on file at the District office). He noted that it could take several years to assemble a group of parcels for a redevelopment project, and that ownership of those properties often changes late in the planning process.

On a motion by Director Knight and second by Director Markey, the Board voted unanimously to adopt the Water Demand Committee recommendation that no changes should be made to Ordinance No. 104 at this time. The motion was adopted on a vote of 7 – 0.

During the public comment period on this item, David Dilworth, representing HOPE, expressed support for the staff recommendation that no changes should be made to Ordinance No. 104.

Director Pendergrass made a motion to approve the recommendation of the Water Demand Committee to complete an Initial Study on Draft Ordinance No. 117 and bring the ordinance forward for first reading at the June 21, 2004 Board meeting. Director Foy seconded the motion.

Director Markey offered an amendment to: (a) add a statement on page 172 before items 9.c and d that reads, “water transfers would not be approved if they have an adverse effect on the water supply.”; (b) revise the conservation set-aside figure from 15 percent to 35 or 50 percent; and (c) specify that if an illegal transfer of money was associated with a water credit transfer, the transfer would be revoked and permanently lost to the donor and receiving sites, and the transfer would be applied towards permanent conservation savings. There was no second to the motion.

The original motion was approved on a vote of 5 – 2. Directors Edwards, Foy, Knight, Pendergrass and Potter voted in favor of the motion. Directors Lehman and Markey were opposed.

The following comments were directed to the Board during the public comment period on this item. (1) Robert Greenwood, representing the Carmel Valley Association, expressed support for the proposed modifications. He commended the District for developing a rule that would base water credit transfers on actual water use, and would establish monitoring of water use on donor and receiving sites for at least five years. (2) David Dilworth, representing HOPE, was skeptical about the District’s assertion that water credit transfers result in reduced water use. He recommended that any water use credit transfer should exhibit an actual reduction in water use.

There was no Board discussion of the Information Items.

The meeting was adjourned at 10:30 PM.

CALL TO ORDER/ROLL CALL

PLEDGE OF ALLEGIANCE

ORAL COMMUNICATIONS

CONSENT CALENDAR

1. Consider Adoption of Minutes of the March 31, 2004 Board Workshop, 7 PM Session; April 19, 2004 Regular Board Meeting; and April 22, 2004 Special Board Meeting

2. Consider Authorization of Contract with Accounting Firm to Conduct Annual Audits for Fiscal Years 2003-2004, 2004-2005 & 2005-2006

3. Consider Approval of Annual Memorandum of Agreement for Releases and Diversions from San Clemente Reservoir

4. Authorize Chair to Write Letter of Support for AB 2918 (Laird) – Desalination Utility Rates

5. Consider Adoption of Treasurer’s Report for March 2004

GENERAL MANAGER’S REPORT

6. Status Report on Seaside Basin Management Plan and ASR

ATTORNEY’S REPORT

7. Report on Closed Sessions of April 28, May 3 and May 17, 2004

DIRECTORS’ REPORTS

8. Board Comments and Referrals

PUBLIC HEARINGS

9. Consider Draft FY 2004-2005 MPWMD Budget

10. Receive Water Supply Forecast for Period of May 1, 2004 – September 30, 2005

11. Consider Amendment of Implementation Guidelines for Disclosure of Ex Parte Communications to Enable Board Members to Orally Report Ex Parte Contacts

12. Consider Second Reading of Ordinance No. 112 (Continued from April 19, 2004) – Rescinding Rules Requiring Disclosure of Ex Parte Communications and Repealing Penalties and Remedies for Non-Disclosure

13. Consider Second Reading of Ordinance No. 114 – An Ordinance of the Monterey Peninsula Water Management District Amending District Rule 24 to Clarify Special Fixture Unit Accounting for Second Bathrooms

14. Consider Second Reading of Ordinance No. 115 – An Ordinance of the Board of Directors of the Monterey Peninsula Water Management District Clarifying Water Use Credit Rules, Cancellation of Permits Rules, and Setting Fees for Water use Credit Documentation

ACTION ITEMS

15. Review Provisions and Make Recommendations Regarding Ordinance No. 104 – Modify Administrative Appeal Processes

16. Consider Potential Modifications to Water Use Credit Transfer Program and Provide Direction to Staff

May 17, 2004

CALL TO ORDER/ROLL CALL

PLEDGE OF ALLEGIANCE

GENERAL MANAGER’S REPORT

INFORMATIONAL ITEMS