EXHIBIT 1-A

FINAL MINUTES

Regular Meeting

Board of Directors

Monterey Peninsula Water Management District

February 22, 2007

The meeting was called to order at 7 PM in the MPWMD Conference Room.

Board members present:

David Pendergrass, Chair – Mayoral Representative

Alvin Edwards, Vice Chair – Division 1

Judi Lehman – Division 2

Kristi Markey – Division 3

Michelle Knight – Division 4

David Potter – Monterey County Board of Supervisors

Board members absent: Larry Foy – Division 5

General Manager present: David A. Berger

District Counsel present: David Laredo

The assembly recited the Pledge of Allegiance

No comments were directed to the Board during Oral Communications.

On a motion by Director Edwards and second by Director Potter, the Consent Calendar was approved unanimously on a vote of 6 – 0. Director Foy was absent.

Approved.

Chair Pendergrass presented a plaque to Michelle Knight in recognition of her service as Chair to the Board in 2006.

General Manager Berger reviewed the Strategic Plan Update that was presented in the Board packet.

Henrietta Stern, Project Manager, presented the report. An outline of her presentation is on file at the District office and on the District’s website.

During the public comment period, Manual Fierro, a member of the District’s Community Advisory Committee (CAC), asked for an update on negotiations between the District and California American Water (CAW) on water rights for the Aquifer Storage and Recovery (ASR) Project. Mr. Berger responded that Mr. Fierro posed an identical question to the CAC in writing, and that the question would be answered at the next CAC meeting.

Darby Fuerst, Water Resources Manager, presented the report. An outline of his presentation is on file at the District office and on the District’s website. Mr. Fuerst reported that CAW production from the Carmel River between October 1, 2006 and February 20, 2007 was 3,615, which is 100 acre-feet below the limit established as a result of SWRCB Order 95-10. Mr. Fuerst also provided an update on the near-term and 90-day precipitation forecast as reported by the National Weather Service. The 90-day forecast indicated that an equal chance existed to receive above normal, normal or below normal precipitation.

District Counsel Laredo reported that he provided the Board with a status report on items 3.A through 3.C. No action was taken on those items. Regarding Item 4, the Board agreed unanimously on a vote of 6 – 0 (Director Foy was absent) to retain Ellen Aldrich of William Avery and Associates to act as the District’s lead bargaining representative related to negotiations with the General and Management Staff Bargaining Units, for a not-to-exceed amount of $22,000.

Director Knight reported that the Seaside Groundwater Basin Watermaster authorized a contract with Martin Feeney to implement a Seawater Sentinel Monitoring Well Work Plan. In addition, the Watermaster’s 2006 Annual Report was submitted as required by the adjudication decision. Ms. Knight thanked Joe Oliver, Senior Hydrogeologist, for the effort he put forth to ensure completion of the Annual Report. She reported that the replenishment assessment monetary amount was established. CAW and the Seaside Municipal Water Company were required to pay the assessment based on the amount of water they produced in excess of their estimated safe yields.

Director Potter reported that his office received several phone calls expressing concern about the quality of repaving associated with the CAW pipeline replacement project on Carmel Valley Road. Mr. Potter asked that District staff advise CAW General Manager, Steven Leonard, about his concern and ask that he investigate the issue and ensure that the pavement is restored to its original condition.

Director Pendergrass reported that he attended the January 28, 2007 meeting sponsored by the Public Utilities Commission Division of Ratepayer Advocates (DRA) on regional water supply planning. He also reported that on February 21, 2007, a meeting was conducted to review a draft Memorandum of Understanding regarding formation of a regional water management planning group. The meeting was well attended by managers, board members and council members of local government agencies. The agency managers agreed to submit the MOU to their governing bodies for review within 45 to 90 days. The MOU will be revised based on comments received, and another meeting will be scheduled to review the document. It should then be forwarded to participating agencies for signature.

Director Potter made a motion to approve the variance with the conditions described in the staff report, and to include two additional conditions: (1) the applicant will indemnify the District should a legal challenge be filed based on the CEQA findings adopted by the Board; and (2) specify by deed restriction that outdoor water use could not be converted to an indoor use. The motion was seconded by Director Knight and approved unanimously on a vote of 6 – 0. Director Foy was absent.

During the public hearing on this item, Fred Hintz, construction manager for the Design Center addressed the Board. He explained that the metering system proposed for the project will monitor water consumption for each residential and commercial user in the building. The information can be accessed by computer upon request. Mr. Hintz stated that he would accept the two additional conditions of approval proposed by the Board at the meeting.

On a motion by Director Edwards and second by Director Knight, the item was continued to the March 19, 2007 Board meeting. The motion was approved on a vote of 4 – 2. Directors Edwards, Knight, Pendergrass and Potter voted in favor of the motion. Directors Lehman and Markey were opposed. Director Foy was absent.

The following comments were directed to the Board during the public hearing on this item. (1) Derinda Messenger, representing the applicant, apologized for late submittal of the request for a continuance. She explained that there was insufficient time for her to review the facts of the appeal, and that the architect is out of the country. (2) Luyen Vun, representing Eric Miller Architects, stated that the staff report was available for review on Friday, February 16, 2007. Due to the February 19, President’s Day Holiday, there was insufficient time for the applicant to respond to the staff recommendation.

Director Markey offered a motion that was seconded by Director Potter to adopt the proposed mid-year budget adjustment for Fiscal Year 2006-07. The motion was adopted unanimously on a vote of 6 – 0. Director Foy was absent.

No comments were directed to the Board during the public hearing on this item.

Director Edwards made a motion to approve the staff recommendation to amend the existing contract with B-E/GEI at a cost not-to-exceed $30,000, which includes a $2,800 contingency amount. The motion was seconded by Director Knight and adopted on a vote of 4 – 2. Directors Edwards, Knight, Lehman and Markey voted in favor of the motion. Directors Potter and Pendergrass were opposed. Director Foy was absent.

Manual Fierro addressed the Board during the public comment period on this item. He stated that the Community Advisory Committee and DRA discussions will occur before the report is updated. He described this timing issue as a catastrophe.

Director Edwards made a motion to adopt the staff recommendation to conduct a workshop on August 30, 2007, and to adopt the five suggestions for improving understanding and cooperation with CAW with the following amendments: (1) add the words “when warranted” at the end of the second sentence in Suggestion No. 3; (2) delete the text of Suggestion No. 5 and replace it with the words, “For Issues that have potential as publicly reported disagreements, CAW and the District commit to discussion in order to reach a common understanding of the facts, and mutual recognition of divergent perspectives.” The motion was adopted unanimously on a vote of 6 – 0. Director Foy was absent. Chair Pendergrass asked that the Public Outreach Committee review the outline submitted by CAW, and refer it to the Chair and Vice Chair for review. The outline will then be submitted to the full Board for approval as a Consent Calendar item.

No comments were directed to the Board during the public comment period on this item.

The Informational Items/Staff Reports were not discussed.

The meeting was adjourned at 9:12 PM.

CALL TO ORDER/ROLL CALL

PLEDGE OF ALLEGIANCE

ORAL COMMUNICATIONS

CONSENT CALENDAR

1. Consider Adoption of Minutes of the January 25, 2007 Regular Board Meeting

2. Consider Expenditure of Budgeted Funds for 2006 MPWMD Annual Report

3. Consider Recommendation of Administrative Committee to Authorize its Continued Work on the Draft PowerPoint Presentation Regarding MPWMD Strategic Water Issues Affecting the Jurisdictions

4. Consider Authorization of Budgeted Contingency Adjustment for Drilling of Full-Scale Aquifer Storage and Recovery (ASR) Well as Part of MPWMD Phase 1 ASR Project

5. Consider Approval of Second Quarter Fiscal Year 2006-07 Investment Report

6. Consider Adoption of Treasurer’s Report for November 2006

7. Consider Adoption of Treasurer’s Report for December 2006

PRESENTATIONS

8. Presentation to 2006 Board Chair, Michelle Knight

9. Strategic Plan Update

10. Water Supply Project Alternatives Update

GENERAL MANAGER’S REPORT

11. Status Report on California American Water Compliance with State Water Resources Control Board Order 95-10 and Seaside Groundwater Basin Adjudication Decision

ATTORNEY’S REPORT

12. Report on 5:30 PM Closed Session of the Board

3. Conference with Legal Counsel – Existing Litigation (Gov. Code 54956.9 (a))

A. Application of California-American Water Company to the Public Utilities Commission Application No. 04-09-019 and the Coastal Commission – Coastal Water Project

B. State Water Resources Control Board Permit No. 7130B

C. State Water Resources Control Board Permit No. 20808

4. Conference with Labor Negotiators (Gov. Code 54957.6)

Agency Designated Representatives: Rick Dickhaut, Cynthia Schmidlin and David A. Berger

Employee Organization: General Staff and Management Staff Bargaining Units Represented by Laborer’s International Union of North America, AFLCIO, (LIUNA/UPEC) Local 270

5. Adjourn to 7 PM Session

DIRECTOR’S REPORTS (INCLUDING AB 1234 REPORTS ON TRIPS, CONFERENCE ATTENDANCE AND MEETINGS)

13. Oral Report on Activities of County, Cities, Other Agencies/Committees/Associations

PUBLIC HEARINGS

14. Consider Request for Variance from Water Meter Requirements (District Rule 23-A) – Design Center, LLC, 600 Ortiz Avenue, Sand City (APN 011-236-026)

15. Consider Appeal of District General Manager’s Decision to Deny a Water Permit for a Third Bathroom Addition to 905 Ocean View Blvd., Pacific Grove (APN 006-031-004)

16. Consider Adoption of MPWMD Mid-Year Fiscal Year 2006-2007 Budget Adjustment

ACTION ITEMS

17. Consider Expenditure of Funds to Prepare Revised Version of June 26, 2006 Report by Bookman-Edmonston/GEI Consultants, “Seawater Desalination Projects Evaluation” Including Seawater Conversion Vessel Alternative

18. Consider Conducting Board Workshop on August 30, 2007 Regarding Operating Functions and Service Responsibilities of California American Water (CAW), and Other Recommendations of the Public Outreach Committee Regarding CAW/MPWMD Relationship Enhancement

INFORMATIONAL ITEMS/STAFF REPORTS

19. Semi-Annual Financial Report on the CAWD/PBCSD Wastewater Reclamation Project