ITEM:		CONSENT CALENDAR
3.	CONSIDER APPROVAL OF ANNUAL MEMORANDUM OF AGREEMENT FOR RELEASES AND DIVERSIONS FROM SAN CLEMENTE RESERVOIR BETWEEN CALIFORNIA AMERICAN WATER, CALIFORNIA DEPARTMENT OF FISH AND GAME AND MPWMD
Meeting Date:			May 16, 2005	Budgeted:	N/A
From:			David A. Berger, General Manager	Programs:	Aquatic Resources and Hydrologic Monitoring
				Line Item No.:	2.4-6
Prepared By:			David Dettman	Cost Estimate:	N/A
General Counsel Approval: N/A
Committee Recommendation: The Administrative Committee reviewed this item on May 3, 2005 and recommended approval.
CEQA Compliance: Consistent with SWRCB WR Order Nos. 95-10, 98-04, 2002-0002
ESA Compliance: Consistent with the September 2001 Conservation Agreement between the National Marine Fisheries Service and California American Water to minimize take of listed steelhead in the Carmel River

SUMMARY: Representatives from the Monterey Peninsula Water Management District (District), California American Water (Cal-Am), the California Department of Fish and Game (CDFG) office in Monterey, and the NOAA Fisheries office in Santa Rosa met on April 25, 2005, to negotiate the terms and conditions for the 2005 Memorandum of Agreement (MOA) for releases and diversions from San Clemente Reservoir. This was the first meeting to discuss and negotiate the 2005 MOA. Based on current storage conditions and expected reservoir inflows, it was agreed that Cal-Am will maintain minimum flows in the Carmel River at the Sleepy Hollow Weir of 20 cubic feet per second (cfs) in May and June, 11 cfs in July, 8 cfs in August, 7 cfs in September, and 6 cfs during the period from October through December 2005. Given the wet-year streamflow conditions, Los Padres Reservoir is expected to continue spilling through July and a portion of August. If the reservoir ceases spilling during July, Cal-Am will maintain a minimum flow of 11 cfs at the Sleepy Hollow Weir. Cal-Am will cease direct surface diversions from San Clemente Reservoir and most wells upstream of the Narrows when Carmel River flow at the District’s Don Juan gaging station in Garland Park is less than 20 cfs for five consecutive days. This should occur during late June, based on the projected inflows and Cal-Am’s ability to bypass inflow at San Clemente Dam. To compensate for the loss of direct diversion, Cal-Am will supply the portion of their service area in the upper Carmel Valley with combined production from the Russell Wells No. 2 and 4 at a maximum rate of 0.5 cfs, the pump at the Del Monte pressure/flow regulating station, located near Boronda Road, and surface storage in the Clear Well Tank located adjacent to the Carmel Valley Filter Plant (CVFP). These actions conform to SWRCB WRO 2002-0002 and the 2001 NOAA Fisheries Conservation Agreement. The 2005 MOA is included as Exhibit 3-A.

IMPACT ON STAFF AND FISCAL RESOURCES: Due to the projected wet-year inflows and generally wet conditions throughout the watershed, staff expects that the lower river will not begin drying-up until late June or early July 2005. While this will forestall the need to conduct rescues, staff is concerned that the transport of sand into and through San Clemente Reservoir, as a result of this year’s high flows and the 2005 Drawdown Project, may complicate the initial startup and operation of Sleepy Hollow Steelhead Rearing Facility (Facility). Management of this situation will require close monitoring of daily reservoir storage and releases and careful operation of the water intake at the Facility. At the present time, staff anticipates rescuing steelhead over a shortened length of stream channel, on the order of six miles, rather than seven to eight miles, and beginning rescues at a later date during the year.

RECOMMENDATION: Staff recommends that the Board approve the 2005 MOA and direct the General Manager to sign the agreement.

BACKGROUND: To define minimum instream flow standards for the Carmel River below San Clemente Dam during the low-flow period (i.e., May through December), the District annually enters into an agreement with Cal-Am and CDFG. In general, the MOA specifies the minimum release that must be maintained from San Clemente Reservoir to the Carmel River and the maximum diversion that is allowed from San Clemente Reservoir to Cal-Am's CVFP.

Beginning in March 2002, Cal-Am was ordered to change its diversions and pumping schedule from the upper Carmel Valley according to the following conditions:^[1]

1. Cal-Am shall immediately upon issuance of this order cease withdrawal of water from the San Clemente Dam during low flow periods except during an emergency. “Emergency” means a system failure such as a pump failure, main breaks or fires, that jeopardizes the public health and safety. Hot weather demand alone shall not per se be an “emergency,” but it is recognized that after taking appropriate conservation measures, if levels in the Clear Well fall below nine feet from the bottom of the tank, an emergency may exist and diversions at San Clemente or the utilization of other facilities may be necessary. Nine feet from the bottom of the tank is a minimum requirement established by California Department of Health Services regulations. In all cases, diversions at San Clemente Dam or the utilization of other facilities shall be undertaken in a manner that is least damaging to the fishery resources, and these emergency operations shall be for the shortest practicable time. Cal-Am shall notify and consult with NMFS, FWS, DFG, and the District prior to implementation of emergency operations. If there is no time for consultation, Cal-Am shall notify NMFS, FWS, DFG, and the District of its emergency operation as early as practicable within eight (8) hours after Cal-Am first becomes aware of the emergency. Cal-Am shall notify, by telephone or telefax, the Chief of the Division of Water Rights within 24 hours of the emergency or by noon of the first business day following the incident. For the purpose of this Order, “low flow periods” are defined as times when stream flow in the Carmel River at the Don Juan Bridge (RM 10.8) gage is less than 20 cfs for five consecutive days. Pursuant to its continuing authority over the public trust, the SWRCB may amend this order to modify the definition of “low flow periods” or to add additional flow requirements to protect steelhead in the Carmel River. The Chief of the Division of Water Rights (Chief) is delegated the authority to modify the definition of “low flow periods” and the authority to add flow requirements based on new information, after finding that any proposed change to the order would better protect steelhead in the Carmel River. The Chief is also delegated the authority to modify the flow requirements of this order, in response to any changes in the requirements imposed under the Endangered Species Act, as necessary to prevent this order from being in violation of the Endangered Species Act or unreasonably interfering with efforts to comply with the Endangered Species Act. Prior to making the finding and prior to making any change to the order, the Chief shall provide notice to the parties to this hearing and give them an opportunity to comment on the proposed change.

2. Upon the issuance of this order, Cal-Am shall reduce diversions during low flow periods, from Garzas Wells Nos. 3 and 4, Panetta Wells, the Robles Well, the Scarlett 8 Well, and Los Laureles Wells Nos. 5 and 6. Current diversions are 1-7 days per month at each well. Diversions at these wells shall be reduced to a maximum of two eight-hour days per month except that those wells that currently operate only one eight-hour day per month shall continue to operate at not more than one eight-hour day per month. This reduction shall be undertaken in stages to enable Cal-Am to monitor water quality to ensure that this reduction can be maintained. Monitoring to ensure compliance with California Department of Health Services requirements and mechanical reliability shall be completed within 15 days of the adoption of this order. To the maximum degree practicable, Cal-Am shall operate these wells at night. In consultation with NMFS, FWS, DFG and the District, Cal- Am can operate the Scarlett 8 well incrementally to meet maximum daily demand after using all other available sources at maximum capacity.

3. Cal-Am shall install, not later than March 31, 2002, a pump that delivers water from the Begonia Zone to the Carmel Valley Village Zone. The “Begonia Zone” is defined to include water well production facilities in AQ3, AQ4 and the Seaside Groundwater Basin. The “Carmel Valley Village Zone” is defined to include all Cal-Am users upstream from the Del Monte Regulating Station. The pump size shall have the capacity, in conjunction with the operation of the Clear Well and the 0.5 cfs flow to be pumped from the Russell Wells, to meet the maximum daily demand of the Carmel Valley Village Zone. This shall minimize the emergency conditions described in Paragraph 1 above. The pump shall be sized within the physical constraints of the vault. Cal-Am shall make arrangements, not later than March 31, 2002, with appropriate contractor(s) to provide and have operational within twenty-four hours of the time that it is needed necessary back-up equipment to insure continued operations in the case of an outage associated with the Del Monte booster station facility.

4. The Russell Wells shall be limited to a combined total instantaneous diversion rate of not more that 0.5 cfs during low flow periods. These actions at the Russell Wells and the modifications at the Del Monte facility shall be evaluated by Cal-Am in consultation with NMFS, FWS, DFG, and the District during the period of January through December 2002. The evaluation shall address and focus on the adequacy of Cal-Am’s plumbing system and the Del Monte facility to accommodate (pump) the water supply needs of the Carmel Valley Village Zone from the Begonia Zone (except 0.5 cfs from the Russell Wells).

5. During the low flow periods, except for 0.5 cfs, all water diverted to Carmel Valley Village Zone shall be water that originates from the Begonia Zone (as defined in Paragraph 3 above).

In addition to the five conditions above, Cal-Am’s ability to divert surface flow at San Clemente Dam is constrained by implementation of the San Clemente Dam Drawdown Project (SCDDP), which is mandated by the California Department of Water Resources’ Division of Safety of Dams. A primary facet of the SCDDP is the planned lowering of the water surface elevation in the reservoir to reduce the risk of flooding during a seismic failure of the dam. Under this plan, Cal-Am is required to bypass the inflow to the reservoir through the existing outlet works beginning as early as April 15, 2005, or when the flow at the Sleepy Hollow Weir equals 30 cfs, and to keep the water surface elevation at 515 feet through December 2005. During this period, Cal-Am proposes to supply water to the Carmel Valley Village Zone from the Russell Wells and the Begonia Zone. The MOA group discussed the application of the SWRCB Order 2002-0002 and the SCDDP to conditions this year and agreed to specify the diversions from San Clemente Reservoir and the production from Cal-Am’s Upper Valley Wells, accordingly.

Based on current reservoir storage and expected inflow conditions for the remainder of Calendar Year 2005, it was agreed by all parties at the April 25, 2005 meeting that Cal-Am would release the following minimum flows from San Clemente Reservoir to the Carmel River (as measured at the Sleepy Hollow Weir) of 20 cfs in May and June, 11 cfs in July, 8 cfs in August, 7 cfs in September, and 6 cfs during the period from October through December 2005. It was agreed that once San Clemente Reservoir stops spilling as Cal-Am begins to draw down San Clemente Reservoir, total diversions to the CVFP would be limited to a maximum of 0.5 cfs, supplied from the nearby Russell Wells No. 2 and 4. At that time, no diversions can physically occur from San Clemente Reservoir. The projected monthly inflows, spills, releases, diversions and storage values for the May 2005 - December 2005 period are shown on Exhibit A of the 2005 MOA. The parties agreed to meet on June 6, 2005 to negotiate the District’s Quarterly Water Supply Strategy and Budget for the July-September 2005 period and determine whether to modify the diversions and releases, if actual inflow and storage do not meet the expectations. Exhibit A of the 2005 MOA also includes actual values for the January 2005 - March 2005 period, which are shown in bold or italic type.[2]

Prior to 1999, the storage in Los Padres Reservoir was managed to limit the drawdown of surface storage and the minimum end-of-month goals during the MOA period ranged from 244 acre-feet (AF) in 1994 to 1,252 AF in 1998. The minimum end-of-month goal for the 2005 MOA period is 720 AF in October (Exhibit A of the 2005 MOA). In 1998, Cal-Am estimated the total storage capacity in Los Padres Reservoir and found that it had declined to 1,569 AF. This represents a loss of 610 AF of surface storage capacity, based on the previous estimate of 2,179 AF in 1984. The loss of surface storage capacity, coupled with the goal of trying to maximize the extent of habitats in the lower river, means that Los Padres Reservoir is expected to be drawn down to approximately 700 AF by the end of Water Year 2005. Also of concern is the need to provide cool, well-oxygenated water for the release below Los Padres Dam. Due to the reduction in reservoir storage there is a risk of releasing water that is too warm for juvenile steelhead, particularly during the early fall. As a consequence, staff anticipates there may be a need to periodically modify the MOA terms and conditions throughout the remainder of the calendar year.

To maximize the instream flow benefits from the proposed releases, the 2005 MOA also includes a condition that limits the amount of water pumped from Cal-Am's production wells in the Upper Carmel Valley (i.e., above the Narrows) to levels required for maintenance of the wells (Exhibit 3-B). This limitation and schedule also applies to the former Water West wells that are now owned and operated by Cal-Am. Similarly, the MOA includes a provision that Cal-Am will make all reasonable efforts to operate its Lower Carmel Valley production wells beginning with the most downstream well and moving to upstream wells as needed to meet system demand. This provision is consistent with Condition No. 5 of SWRCB Order 95-10.

The proposed MOA may be modified by mutual consent of all the parties and will be monitored weekly by representatives of the three parties. It should be noted that the releases and operations specified in the MOA are consistent with the releases and diversions that were approved in the Quarterly Water Supply Strategy and Budget for Cal-Am for the April-June 2005 period. The agreement becomes effective upon being signed by the three parties and extends through December 31, 2005.

EXHIBITS

3-A 2005 Memorandum of Agreement between California American Water, the Monterey Peninsula Water Management District, and the State of California Department of Fish and Game to Release Water into the Carmel River from San Clemente Reservoir

3-B Maintenance and Water Quality Pumping Schedule, 2005

U:\staff\word\boardpacket\2005\2005boardpackets\20050516\ConsentClndr\03\item3.doc

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^[1]Order WRO 2002-0002 was adopted by the State Water Resources Control Board on March 21, 2002. As noted in paragraphs 5, 6, and 8 of the 2005 MOA, Paragraphs One and Two of Order WRO 2002-0002 are referenced as Exhibit B in the 2005 MOA.

^[2] Bold type indicates final estimates and bold italic indicates preliminary estimates.