EXHIBIT 12-D

DISTRICT RULE 23-D

D. CONDITIONS AND CONDITIONAL WATER PERMITS

The Board, or the General Manager on those applications acted upon by the General Manager, may place conditions upon the grant of any expansion/extension permit. For any permit, which would allow the use of potable water for greenbelt irrigation, the following condition shall be imposed:

1. The holder of this permit, or the holder's successor in interest, shall not use water derived from this connection to irrigate any greenbelt the Monterey Peninsula Water Management District has declared by resolution that sub‑potable water as defined by the District's Rules and Regulations is reasonably available for such use.

2. A category of water permits known, as Conditional Water Permits shall be available to a limited group of water permit applicants under restricted circumstances and only with the jurisdiction's endorsement. A Conditional Water Permit creates a record that specifically quantifies the increment of water assigned for use at the location designated by the jurisdiction and debits the jurisdiction's water allocation. Conditional Water Permits are available to those projects that are unable to meet all of the criteria of Rule 23-A-1 (a) and meet the requirements of Rule 23-D-2.

A. The following categories of projects may obtain a Conditional Water Permit:

1. Large Projects - Commercial projects with a projected water demand of over one acre-foot annually.

2. Government Projects - Projects owned and operated, or financed by a governmental agency.

3. Projects with Complex Financial Underwriting - Determined at the discretion of the Board of Directors.

B. The Conditional Water Permit may be issued when the following criteria have been met:

1. There is no water supply emergency;

2. There is sufficient water supply in the jurisdiction's allocation;

3. The governing body of a jurisdiction submits a written request that a Conditional Water Permit be issued to a project;

4. A completed Water Release Form for the project is submitted which includes the authorizing signature of the jurisdiction to debit its water allocation;

5. Payment of all connection charges and processing fees has been received by the District.

C. A Conditional Water Permit must be finally approved by the General Manager, following review of the proposed conditions by the District's legal counsel. The notarized signature of the project applicant is required before the General Manager's signature is obtained.

D. A Conditional Water Permit shall be numbered with the next sequential alpha and numeric number beginning with C-001, C-002, and etcetera. A final water permit bearing the final water permit number referenced in the conditional water permit shall be maintained, unsigned in the District's file. An amount of water approved for use by the jurisdiction for the project will be debited from the jurisdiction's water allocation at the time the conditional water permit is issued.

E. A Conditional Water Permit does not allow the setting of any water meter or the start of any new or expanded water use until the conditions of the permit have been met.

F. A condition shall be included in all Conditional Permits, which requires the adjustment of the connection charge to accurately reflect the cost-per-acre-foot at the time the final water permit is issued. Any difference in the connection charge between the time the Conditional Water Permit is issued and the final Water Permit is issued must be paid in full.

G. Each Conditional Water Permit is time limited. The Conditional Water Permit shall expire on December 31st of the year following issuance.

H. A written request for extension of the Conditional Water Permit may be requested and shall require Board authorization for extension. Requests for extension must be received no later than forty-five (45) days prior to expiration and must include an explanation for the request and the jurisdiction's agreement that the Board should grant an extension.

Added by Ordinance No. 77 (8/21/95)

U:\staff\word\boardpacket\2004\2004boardpacket\20041213\PublicHearings\12\item12_exh12d.doc