EXHIBIT 17-A

 

DRAFT MEMORANDUM OF UNDERSTANDING

BETWEEN

PAJARO / SUNNY MESA

COMMUNITY SERVICES DISTRICT

AND

MONTEREY PENINSULA

WATER MANAGEMENT DISTRICT

 

WHEREAS, the California Legislature created the Monterey Peninsula Water Management District (MPWMD or District) to serve as the regional water resources manager; and

 

WHEREAS, the voters of the Monterey Peninsula ratified powers and functions for the Monterey Peninsula Water Management District (MPWMD) election held in June, 1978; and

 

WHEREAS, the Water Management District boundaries encompass the cities of Carmel-by-the-Sea, Del Rey Oaks, Monterey, the Monterey Peninsula Airport District, Pacific Grove, Sand City, Seaside and portions of Monterey County, primarily in Carmel Valley.  With minor exception, the entire Cal-Am water system lies within the jurisdictional boundary of the Water Management District; and

 

WHEREAS, the California Legislature found in Water Code Appendix, Section 118-2 that “the water problems of the Monterey Peninsula area require integrated management of ground and surface water supplies, for control and conservation of storm and wastewater, and for promotion of reuse and reclamation of wastewater;” and 

 

WHEREAS, the California Legislature declared in Water Code Appendix, Section 118-2 that, “In this region of primarily scenic, cultural, and recreational resources, which are particularly sensitive to the threat of environmental degradation, such need cannot be effectively met on a piecemeal basis;” and 

 

WHEREAS, the Monterey Peninsula area has both a physical shortage of water, and a limited quantity of water for which legal rights have been secured.  During periods of normal to wet hydrological conditions, there are sufficient water supplies to meet the hydrologic needs of the area.  However, during periods of drought, there has not been sufficient water to satisfy the needs of both environmental and municipal water requirements; and 

 

WHEREAS, in addition to the physical limitations which affect the water supply available to the Monterey Peninsula area, use limitations were added in 1995 by the State Water Resources Control Board in SWRCB Order WR 95-10 (as revised by Orders WR 98-04 and 2002-02).  This SWRCB proceeding was a hearing on complaints that alleged that Cal-Am’s use of Carmel River water was without valid rights and adversely impacted environmental and public trust values.  In Order WR 95-10, the State Board found and directed Cal-Am to cease and desist diverting water from the Carmel River in excess of 11,285 acre-feet-per-annum (AFA), beginning in 1997.  The effect of SWRCB Order WR 95-10 is that, since the issuance of Order WR 95-10, Cal-Am has diverted annually about 10,730 AFA from the Carmel River or its underflow without a valid basis of right, and Cal-Am has not developed new water resources to replace it’s dependence upon that Carmel River source; and

 

WHEREAS, other factors also adversely influence the present and future availability of water to the Cal-Am system from the Carmel River.  These include the recent listing of threatened species (i.e., California Red Legged Frog and Steelhead Trout) and associated regulatory limits which are or may be imposed under the federal Endangered Species Act by the U.S. Fish and Wildlife Service and NOAA Fisheries Service; and

 

WHEREAS, the Monterey Peninsula Water Management District has determined that it is fully necessary and appropriate to investigate and pursue the identification, acquisition, and provision of potable water supplies to it’s residents, property owners, and constituents from a desalination plant that may be developed by a public agency or consortium of public agencies to address regional water shortages and/or water quality and contamination problems; and

 

WHEREAS, the Pajaro-Sunny Mesa Community Services District is a public, not-for-profit governmental agency that was reorganized pursuant to provisions of the Cortese-Knox Act and the California Government Code in 1992 to provide multiple governmental services, including public potable water service and delivery, to its constituents in the areas of Pajaro, Sunny Mesa, and North Monterey County; and

 

WHEREAS, the Pajaro-Sunny Mesa Community Services District and it’s Board of Directors, pursuant to the decision of Judge Jeremy Fogel in the case of United States Of America v. Alisal Water Corporation (CASE NO. C97-20099 JF), were granted and assumed responsibility for five additional water systems located in the communities of Moss Landing, Prunedale, and other areas of North Monterey County that will be sold to Pajaro-Sunny Mesa Community Services District from the receivership assets of ALCO Water Company; and

 

WHEREAS, the areas and water systems of North Monterey County served currently and to be served in the future by the Pajaro-Sunny Mesa Community Services District cover many square miles, and have experienced and will continue to experience seawater intrusion and contamination of their groundwater supplies, and also experience sporadic contamination of their groundwater supplies from naturally occurring arsenic; and

 

WHEREAS, the Pajaro-Sunny Mesa Community Services District Board of Directors has determined that it is necessary, prudent, and in the best interests of its constituents, and their health and safety, to secure and build a publicly owned site and facility for the desalination of seawater and the production of low cost potable water to address the long-term water supply needs, shortages, and water contamination problems of the communities of North Monterey County; 

 

 

NOW, THEREFORE, BE IT RESOLVED that the Monterey Peninsula Water Management District and the Pajaro-Sunny Mesa Community Services District (the Parties) hereby agree and enter into this Memorandum of Understanding as follows:

 

1.                  PURPOSE OF AGREEMENT.  This document recites shared understandings, agreements, and common beliefs of the Parties, and provides a template for future collective action to facilitate management and development of water resources that shall be of common benefit to the Parties, and to all of the constituents that they serve. 

 

2.                  OPPOSITION TO PIECEMEAL MANAGEMENT OF WATER RESOURCES.  Actions that would result in piecemeal development or management of vital public water resources, and that would thwart integrated public ownership and management of such resources, are not in the best interest of the Parties, their public, their citizens and constituents, or the unique and important environmental and natural resources of the Monterey Bay area. Such piecemeal management would threaten the public welfare, our region’s environmental quality and resources, and the health, safety, and property of the residents of the service areas of the Parties.

 

3.                  CONFIRMATION OF JOINT INTENT TO COOPERATE.  The Parties acknowledge and confirm their mutual desire and intent to cooperate and jointly undertake efforts to plan the development and ultimate construction and operation of a publicly owned, regional desalination plant for their mutual benefit and for the benefit of their constituents, voters, property owners, and residents.  To assure and facilitate this effort, the Parties, and their representatives, shall fully cooperate in the conduct and coordination of meetings, shall fully share information and data, and shall jointly establish necessary budgets and timelines.  Meetings between staff, committees, and boards shall be held to further this end.

 

4.                  DEVELOPMENT OF A DESALINATION PLANT PLAN.  The Parties desire and intend that their cooperative effort shall result in the development, refinement, and completion of a mutually acceptable development and financing plan that will lead to construction and operation of a publicly owned and operated desalination plant, situated in Moss Landing, California, to meet the potable water needs of the Parties currently and in the future. The Parties acknowledge that the Pajaro-Sunny Mesa Community Services District has previously entered into agreements and secured a site for the purposes of the development of a desalination facility, previously known as the National Refractories property, in Moss Landing, CA.

 

5.                  DEVELOPMENT OF A JOINT POWERS CONCEPT.  The Parties further desire and intend to develop a joint powers concept, or acceptable alternative governance structure, to facilitate implementation, development, and operation of the water supply plan.

 

6.                  AQUIFER STORAGE & RECOVERY (ASR) TO CONTINUE.  The Parties confirm their agreement and understanding that the Monterey Peninsula Water Management District shall continue its independent efforts to plan, test, design, and implement ASR activities and programs in the Seaside Groundwater Basin. 

 

7.                  ALTERNATIVES NOT PRECLUDED.  The Parties expressly acknowledge that the effect of this agreement shall not limit or otherwise inhibit independent and ongoing discussions of either Party that may address cooperative efforts between that Party and any of the following entities:  California American Water, Monterey County, Monterey County Water Resources Agency, Monterey Regional Water Pollution Control Agency, Marina Coast Water District, and/or Fort Ord Reuse Authority (FORA). The Parties, and their representatives, shall fully disclose to each other the nature and content of such independent and ongoing discussions in a complete and timely manner.

 

8.                  EFFECTIVE DATE.  This MOU shall take effect on September 1st of 2004, and the representatives and counsels for the Parties are directed to fully comply with, pursue, and implement the provisions and directives found herein upon the execution of this MOU by both Parties. 

 

9.                  TERMINATION.  Any Party may terminate this MOU by providing written notice to the other.  The effective date of termination shall be thirty (30) days following receipt of such written notice.

 

10.              ENTIRE AGREEMENT.  This MOU represents the entire agreement between the Parties, and supersedes any prior written or oral negotiations and representations between the Parties.

 

 

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement:

 

Pajaro / Sunny Mesa CSD

 

 

                                                                       

                        (Date)

General Manager

 

Approved as to form:

 

                                                                       

Counsel for CSD                            (Date)

 

 

Monterey Peninsula Water Management District

 

                                                                       

                        (Date)

General Manager

 

Approved as to form:

 

                                                                       

Counsel for MPWMD                              (Date)