EXHIBIT 12-B

REVISED REQUEST FOR PROPOSALS FOR

CONSULTANT ASSISTANCE TO IMPLEMENT RULES AND REGULATIONS GOVERNING WATER DISTRIBUTION SYSTEMS

Today’s Date: Monday, February 10, 2003

Proposal Deadline Date: 5 copies received by Friday, February 28, 2003 at 4:30 PM

INTRODUCTION:

At its December 16, 2002 meeting, the Monterey Peninsula Water Management District (MPWMD) Board of Directors adopted Ordinance No. 105, which amends current MPWMD Rules and Regulations that govern water distribution systems. Ordinance No. 105 became effective on January 15, 2003. The most significant change to the existing rules is that single-parcel connection systems within the Carmel River Watershed and within MPWMD boundaries will be regulated. Currently, only single-parcel systems within the Carmel Valley Alluvial Aquifer, or within 1,000 feet from the Carmel Valley Alluvial Aquifer and five previously named tributaries are regulated. Single-parcel systems refer to one well serving only one legal parcel, typically a single-family home.

At its December 16, 2002 meeting, the MPWMD Board also authorized District staff to issue a Request for Proposals (RFP) to consultants to help District staff (1) reduce back-logged water production limit assignments, and assist with other data management tasks, as needed; (2) assist with a higher anticipated volume of new applications; and (3) assess how well the permit process is functioning. An RFP was transmitted in late December 2002 to four local planning firms, with the assumption that the Board would authorize a contract with the selected consultant at its January 30, 2003 meeting. This did not occur because the Board believed the RFP should be circulated to a broader mailing list of consultants, and that an additional question should be added to the RFP regarding litigation. This revised RFP represents the direction by the Board.

A proposal is being solicited from your firm to carry out the three major tasks that are more completely described below. The Proposal can be in letter format that responds to the consultant questions enumerated below, with attachments as needed. The deadline for submitting a Proposal is Friday, February 28, 2003 at 4:30 PM. A recommendation will be presented to the Board Administrative Committee at its March 11 meeting, to be confirmed by the full Board at its March 18, 2003 meeting.

BACKGROUND:

The MPWMD has regulated water distribution systems within its boundaries for many years. In the past, that regulation has focused on multiple-parcel systems with the parcels being served under separate ownership. MPWMD Ordinance No. 96, approved in March 2001 (effective on April 18, 2001), amended several MPWMD Rules and Regulations governing permits for water distribution systems. The primary change was that single-parcel systems are considered to be water distribution systems that need permits, except for those outside of the Carmel Valley Alluvial Aquifer or more than 1,000 feet from the Alluvial Aquifer and five named tributaries.

In April 2001, the District Board approved draft Implementation Guidelines, including a Supplement to the Guidelines, which provide guidance on the water distribution system permit process. Please note that the Implementation Guidelines will be revised by District staff in the near future, based on recent ordinances and other direction provided by the Board.

The December 16, 2002 information package, which includes the second reading version of Ordinance No. 105, is provided as Attachment 1). Applicable sections of the MPWMD Rules and Regulations, which incorporate Ordinance No. 96, are provided as Attachment 2; excerpts from the draft Implementation Guidelines are provided as Attachment 3.

Based on Monterey County well permit trends to date, adoption of Ordinance No. 105, with its regulation of all single-parcel connection systems within the Carmel River Watershed, could increase the number of MPWMD water distribution system permits to process annually by a factor of four to six times the current workload.

CONSULTANT TASKS:

The consultant would be retained for the April 1-December 31, 2003 period (or shorter, if budgeted funds are expended) to assist District staff with three major tasks:

(1) Set production and connection limits for current systems that need a case-by-case review. If time and resources allow, this task may also entail organizational assistance of well-related data that includes a geographic information system (GIS).

(2) Process the expected influx of new applications for water distribution system permits.

(3) Assess workload impacts and procedures, and make recommendations to improve ordinance implementation.

Task 1, Set Production Limits -- There are an estimated 30 permitted multiple connection systems that currently do not have annual production limits and/or connection limits associated with the permits. In addition, there are an unknown number of “grandfathered multiple-parcel connection systems” that need system limits to be set on a case-by-case basis. An example of a “grandfathered system” might be a farm in Carmel Valley that is comprised of several adjacent parcels owned by the same owner and served by one well, a situation that was not previously considered to be a water distribution system. It is estimated that these systems may require five to ten hours each to develop the system limits using the newly defined criteria in Rule 40 (see Ordinance No. 105 for these criteria). The consultant will work with system owners to review well testing and production records, zoning, water rights, land use and other factors, and make a recommendation to District staff. The General Manager would determine the limit as specified in Rule 40.

If time and resources allow, the consultant will work with District staff to organize well-related data and collect new data to enable a more comprehensive, usable data set. Tasks might include locating well locations with a GPS unit, updating the well-related database, organizing and portraying information using GIS, and/or writing a technical procedures manual on specific aquifer testing and evaluation methods to be used by applicants and their agents.

Task 2, Process New Permit Applications -- Based on Monterey County Health Department well construction permit records, District staff expect to process 25 single-parcel well applications per year as compared to the four applications per year that were processed in year 2002. Each single-connection permit takes about 35 hours total for cumulative District staff and counsel participation in the permit process. The State Permit Streamlining Act involves several tight deadlines when processing permits, with only one option for a limited time extension if both parties agree. The tight deadlines result in a situation where the water distribution system permit becomes the de facto top priority for staff’s time, which can interrupt other high priority strategic initiatives.

The consultant would help MPWMD staff process the expected influx of single-parcel permit applications on an as-needed basis, with emphasis on assessing the technical information in the application. The consultant would also assist staff with complex multi-parcel applications that may be received. Attachment 4 provides a summary of the steps involved in processing a permit. These steps include: assessing information provided in the application, communications with applicants, writing completion letters, setting up hearings, roughing out staff notes for the public hearing, developing water system production and connection limits, developing draft Findings and Conditions, and preparing post-approval letters using materials developed by District staff in the past year as a guide.

Task 3, Assess Workload and Procedures; Recommend Action -- The consultant would help staff to assess the workload impacts and procedures in the April-December 2003 period, and make recommendations on how to improve the process.

BUDGET:

At the December 16, 2002 Board meeting, the District Board authorized a budget of up to $51,000 for consultant services, based on an estimated total of 600 hours (as shown below) at a rate of $85 per hour. The Board was advised that staff would pursue the most cost-effective option as part of the consultant selection process, with the intent that the $51,000 amount would be used as efficiently as possible.

Ø 360 hours for Task 1, setting production limits for existing systems with possible GIS or data base management. Assume 45 systems times an average of 8 hours each. (Assume 30 known permitted systems and 15 currently grandfathered systems such as farms in Carmel Valley). The 360 hours include additional database related tasks, if time and resources are available.

Ø 200 hours for Task 2, assisting staff in processing permits, with technical assistance or overview provided by District staff. Assume 10 applications received times 20 hours per application expended by the consultant. This does not include the cost of MPWMD staff time, which would be an estimated cumulative 15 hours for each application. It should be noted that the actual number of permit applications received may be larger or smaller than the 10 applications that are estimated. The District will only pay for actual time where work is performed, and will not engage a consultant “on retainer.”

Ø 40 hours for Task 3, assess resource impacts and procedures, and make recommendations; assist MPWMD staff as needed.

QUESTIONS FOR CONSULTANTS:

In lights of Tasks 1-3 described above, please answer each of the following questions; include supporting attachments as needed.

1. Describe the qualifications of your firm as well as the members of your staff who will be assigned to this project. Please provide names and resumes of assigned staff members.
2. Describe your experience assisting public agencies with permit processing or similar regulatory tasks. What types of permits were involved; what tasks and types of evaluations did you perform? Did you work directly with applicants? What type of agency staff supervision was involved?
3. Describe your experience and/or ability to set water production limits (reasonable annual production that would be expected for a given project situation) based on the hydrologic, zoning, environmental and other criteria listed in Ordinance No. 105, Rule 40 (see ordinance text in Attachment 1).
4. Describe your experience and expertise regarding water wells, including your ability to assess hydrologic and geologic information about a well, and make conclusions about the reliable yield that may be expected from that well.
5. Provide up to three references, including at least one local governmental agency.
6. Describe your knowledge and familiarity with local water resource issues in the Monterey Peninsula area, including Carmel Valley and the Highway 68 corridor.
7. Provide a cost estimate for your services, including your assumptions about the number of hours works, the staff assigned and the rates charged. In a table format, please break out the cost estimates for each of the three tasks enumerated above. Please describe how you would handle the uncertainties associated with the number of permits actually received.
8. Describe your office facilities with emphasis on computer hardware and software that you regularly use (e.g., word processing, scan documents, printing capability, GIS). Your system must be able to send and receive Microsoft Word documents as e-mail attachments.
9. Describe your experience with GIS systems and databases. The District is currently building a GIS for water resources data, including water wells, on the ARCView 8.1 platform. Organizational assistance of water well data may be requested as part of this work effort, if timing and volume on water distribution system applications allow.
10. What expectations do you have regarding District logistical support to enable you to successfully accomplish Tasks 1-3?
11. Are you aware of any projects or clients that could impede your ability to carry out Tasks 1-3 in a fair and unbiased manner? If selected, you must complete the MPWMD Conflict of Interest Statement (provided as Attachment 5).
12. In the past 10 years, describe any legal challenges or litigation involving work products by your firm (excluding billing disputes) or your subcontractors for which you were directly responsible. Describe the outcome and any other relevant information. Have any permit violations been lodged against your firm under the Endangered Species Act or by the permitting agency associated with implementation of a mitigation/monitoring plan for which you were responsible?

PROPOSAL SUBMITTAL:

Please submit five (5) copies of your proposal to be received in the District office no later than Friday, February 28, 2003 at 4:30 PM to:

Henrietta Stern, Project Manager

Monterey Peninsula Water Management District

5 Harris Court, Building G (Ryan Ranch)

Monterey, CA 93940

Please contact Henrietta Stern at 658-5621 or henri@mpwmd.dst.ca.us if you have questions.

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Feb 10, 2003, REVISED 5 pp.