1. DISCUSS ACTION TO BE TAKEN ON WATER
SUPPLY PROJECT INITIATIVE
Meeting
Date: March 27, 2003 Budgeted: N/A
Program/Line
Item No.: N/A
Staff
Contact: Henrietta
Stern Cost Estimate: N/A
General Counsel Approval:
Staff note not reviewed
Committee Recommendation:
staff note not reviewed by committee
CEQA Compliance:
EIR in progress
SUMMARY: The Board will consider various policy options that affect the Phase 2 scope of work for Jones & Stokes Associates (JSA) and its primary subcontractor, Camp Dresser McKee (CDM), for preparation of a Draft Environmental Impact Report (DEIR) for a long-term water supply project on the Monterey Peninsula. Please see Item 1-C for detailed information on the Phase 2 scope of work.
RECOMMENDATION: The Board should provide policy guidance on the following issues:
ISSUE 1: Does the MPWMD wish to propose its own water supply project, to be funded by the District as authorized by a public vote?
ISSUE 2: Should the MPWMD EIR continue to evaluate three increments of Cal-Am production at a project level of detail?
ISSUE 3: What is the production goal for the proposed MPWMD water supply project?
ISSUE 4: Which agency should serve as CEQA lead for Cal-Am’s Coastal Water Project?
ISSUE 5: How should Cal-Am’s current application to MPWMD for the Carmel River Dam and Reservoir Project be addressed?
DISCUSSION: The following paragraphs provide a more detailed look at the five policy questions. Board direction will affect the scope of work for the water supply project EIR, which is discussed in Item 1-C.
ISSUE 1: Does the MPWMD wish to propose its own water supply project, to be funded by the District as authorized by a public vote?
It is assumed (to be confirmed by Board direction in Item 1C) that the MPWMD project would focus on local desalination, with a small aquifer storage and recovery (ASR) component. This project would be independent of the California-American Water Company (Cal-Am) Coastal Water Project (CWP), comprised of a large desalination plant in Moss Landing, ASR and infrastructure such as pipelines. This question goes to a fundamental policy issue of public versus private ownership of water supply facilities, and from where those supplies should be derived. It should be noted that District enabling legislation directs, “To the extent feasible, the District policy shall require development of water resources within the District boundaries before utilizing water originating outside its boundaries” (State of California Statutes of 1977, Chapter 527, page 1687, Section 325.5). [emphasis added]
ISSUE 2: Should the MPWMD EIR continue to evaluate three Cal-Am production increments at a project level, or evaluate some at the project level and the others at the program level?
In 2002, the Board directed that the EIR should examine facilities needed to meet three levels of Cal-Am production, and the three increments were included in the Notice of Preparation (NOP) for the EIR. In previous presentations, these three levels were referred to as “Steps 1, 2 and 3.” The three increments include:
(1) Meet and legalize existing demand constrained by SWRCB Order 95-10 to 15,285 AFY Cal-Am production; need new supply totaling 8,409 AFY for lawful supply.
(2) Enable full use of existing MPWMD Allocation Program EIR limit of 17,641 AFY Cal-Am production; entails a potential increment of growth; need new supply totaling 10,675 AFY for lawful supply.
(3) Provide an additional 1,300 AF increment of growth in addition to Increment #2 totaling 18,941 AFY Cal-Am production; need new supply totaling 12,065 AFY for lawful supply.
The policy question is: “Should combinations of facilities be evaluated at the project level in the EIR to meet all three production increments, or should some be selected for project level analysis, while the others discussed at a program level in the EIR?” The choices include one, two or all three increments being evaluated at the project level. For example, if only the first increment is selected, facilities needed to meet 8,409 AFY of production would be described in detail in the EIR. A general description and less detailed analysis of additional facilities to meet higher increments of production would also be included in the EIR.
ISSUE 3: What is the production goal for the proposed MPWMD water supply project?
The Board should select one of the three increments noted above. A related question previously posed by members of the public is: “If the project goal is focused on making the existing supply lawful, what project(s) and process is envisioned to meet the water needs associated with existing legal lots of record and remodels, and other future water needs? A future separate EIR can focus on additional facilities that are defined to meet future needs.
ISSUE 4: Which agency should serve as CEQA lead for Cal-Am’s Coastal Water Project? In light of the answer to Issue #1, MPWMD should respond to the California Public Utilities Commission (CPUC) request for feedback on which agency should serve as lead agency for Cal-Am’s CWP. The March 12, 2003 CPUC Ruling on this matter is provided as Exhibit 1-B. Specifically, the Board should provide direction to staff regarding:
1. Should the District serve as lead agency (or co-lead agency) for the EIR that evaluates Cal-Am’s CWP? Under what circumstances? If not MPWMD, then what agency is recommended? Cal-Am has requested that the CPUC serve as lead agency, but the CPUC has not agreed to serve as lead to date. On March 18, 2003, the Monterey County Board of Supervisors indicated its interest in serving as lead agency. The CPUC will likely make its decision after receiving feedback from agencies on April 11, 2003.
2. If MPWMD is assigned to be lead agency (or co-lead agency) for the CWP EIR, and assuming MPWMD will pursue its own local desalination proposal, should there be two separate EIRs – one for the MPWMD local desalination proposal and one for the CWP proposal -- or should the EIRs be combined into one comprehensive document? The pros and cons relate primarily to the impact to the schedule to hold a November 2004 election versus duplication of effort for two similar documents. It should be noted that MPWMD would serve as a responsible agency at a minimum due to its authority to regulate the Cal-Am water distribution system, including major new facilities such as pipelines and ASR wells.
CEQA does not prevent the MPWMD from serving as the lead agency for an EIR that evaluates the Moss Landing desalination project that is located outside of the District boundaries. CEQA enables any water agency in California to prepare an EIR to evaluate importation of water from a variety of distant sources to provide water for use within the agency boundaries. A permit to amend the Cal-Am water distribution system must still be obtained from the District, but the permit may not be needed until the system is ready to be used. Thus, another entity could be the lead agency and the District could serve as a responsible agency. The discretionary decision on the permit application must be based in part on environmental review in compliance with CEQA.
ISSUE 5: How should Cal-Am’s current application to MPWMD for the Carmel River Dam and Reservoir Project be addressed?
Cal-Am currently has an active application before MPWMD to amend its water distribution system by constructing the Carmel River Dam and Reservoir Project. The State Permit Streamlining Act requires due diligence to process this application. To date, Cal-Am has amended its CPUC application for the dam but not the MPWMD application. Based on comments by Cal-Am’s General Manager in a March 12, 2003 speech to the League of Women Voters, it is unclear whether Cal-Am plans to retain its application for a dam as active or not. In its March 12, 2003 Ruling (Exhibit 1-B), the CPUC directs Cal-Am to “describe the status of the Cal-Am environmental compliance/CEQA related to the Carmel River Dam at the Monterey Peninsula Water Management District (MPWMD), the process that would be used to wind down those activities while preserving the work developed by MPWMD, and other issues that would be impacted by the designation of the Commission as lead agency.”
If Cal-Am is no longer going to pursue the dam as its proposed project, the MPWMD Board has options such as:
Ø In a letter, ask Cal-Am to formally rescind or request that MPWMD indefinitely put on hold its application for the Carmel River a dam;
Ø Hold a public hearing and deny the application;
Ø Continue to process the application, which includes evaluation of the dam in the EIR.
Voluntary action by Cal-Am would be the easiest option from the perspective of the District. Pros and cons of the other options relate to the staff/consultant time and cost to evaluate the project in the EIR versus developing Findings of Denial and other efforts associated with the public hearing on the water distribution system permit.
U:\staff\word\boardpacket\2003\2003boardpacket\20030327\7
PM Session\ActionItems\1\B\item1b.doc