ITEM:		INFORMATIONAL ITEMS/STAFF REPORTS
26.	QUARTERLY WATER SUPPLY PROJECT STATUS REPORT
Meeting Date:			July 18, 2005	Budgeted:	N/A
From:			David A. Berger,	Program/	N/A
			General Manager	Line Item No.:
Prepared By:			Henrietta Stern	Cost Estimate:	N/A
General Counsel Approval: N/A
Committee Recommendation: N/A
CEQA Compliance: N/A

This is a quarterly report on District water supply augmentation projects for the April through June 2005 period. The next quarterly report will be written in October 2005. Limited background information is provided herein. An historical overview of previous action may be found in year 2003 and 2004 reports. Information is also available as part of the weekly General Manager’s letter to the Board, which can be found on the District website at www.mpwmd.dst.ca.us.

Based on a Strategic Planning Session held in September 2004, the current priority water augmentation efforts include:

Ø Proceed with MPWMD aquifer storage and recovery (ASR) test project in Seaside Basin;

Ø Prepare an Environmental Impact Report (EIR) on a long-term District ASR project to be completed in phases;

Ø Collaborate and cooperate with other agencies on development of a long-term regional water supply solution, with emphasis on desalination;

Ø Prepare Seaside Basin Groundwater Management Plan.

At the September 2004 meeting, the District Board reviewed several proposed water augmentation projects in a detailed comparative matrix. The Board confirmed that it would not proceed on further analysis of a local MPWMD-owned desalination project in the Sand City area, and instead focus its efforts on collaboration with other agencies on a regional water supply project.

Conduct ASR Testing and Obtain Water Rights

ASR entails diverting excess winter flows from the Carmel River through existing California American Water (Cal-Am) facilities and injecting the water into the Seaside Groundwater Basin Coastal Subareas for later recovery. Since 1996, the District has evaluated the feasibility of ASR at greater levels of detail, including obtaining temporary water rights to divert Carmel River water and inject it into the Seaside Basin. From 1998 through March 2005, the District has injected approximately 1,450 acre-feet (AF) of excess winter flow from the Carmel River into the Seaside Basin. A similar amount has been recovered and delivered to the community via the Cal-Am system as part of the test program.

In November 2004, the District received a temporary permit from the State Water Resources Control Board (SWRCB) for continued testing of the MPWMD Santa Margarita Test Well in the Seaside Basin through May 14, 2005, pending adequate flows in the Carmel River. A diversion limit of 350 AF was set for 2005. Injection testing began on January 4, 2005 and ended in early April 2005, when the 350 AF limit was reached. Testing efforts in the April-June period concentrated on water quality effects of the injected water on the local groundwater.

Other ASR action in the April-June 2005 period included:

Ø Coordinated with SWRCB staff regarding the District’s permit application for water rights for the long-term ASR project. Two Petitions for Change were originally submitted by the District in October 2001 and revised in September 2003. The SWRCB noticed the District’s Petitions on April 15, 2005 with a 30-day response period for protests. Seven protests were received; only two were accepted by the SWRCB. The District prepared a formal response to the National Marine Fisheries Service protest in mid-June 2005; a response to the California Department of Fish & Game protest is nearing completion in early July 2005.

Ø Coordinated with Cal-Am, City of Seaside and U.S. Army staff regarding permits to construct a temporary, above-ground pipeline along General Jim Moore Boulevard to facilitate needed Cal-Am delivery system reliability in Summer 2005. District staff assisted Cal-Am in obtaining permit approval from the Seaside City Council at its June 16, 2005 meeting.

Ø Continued to meet with Cal-Am on a Memorandum of Agreement regarding ASR testing, mutual aid, cost-sharing, water rights and other issues. The District Board addressed this issue in May and June 2005, but a final agreement has yet to be approved.

Prepare EIR/EA to Evaluate MPWMD ASR Project

In September 2004, the Board directed staff to initiate preparation of an EIR on the District’s ASR project. Contract amendments with Jones & Stokes Associates (JSA) and Padres Associates were approved in October 2004. A Notice of Preparation (NOP) of an EIR was issued on December 13, 2004. Public hearings to receive oral comments on the NOP were held on January 12, 2005. The deadline for written comments was January 18, 2005. A total of 13 letters (including one e-mail) were received; a total of 11 (non-District) people attended the public hearings. At its February 24, 2005 meeting, the Board received a formal Scoping Report summarizing the NOP comments. At its March 21, 2005 meeting, the Board provided direction to staff on the ASR project description and revised scope of work for the EIR, in light of the NOP comments and several coordination meetings with local agencies and Cal-Am. Please see the Board packet materials for February 24 and March 21, 2005 for detailed information. This information is also on the District website: www.mpwmd.dst.ca.us.

The December 2004 NOP originally envisioned in three phases, with emphasis on a smaller Phase 1 project to be implemented within one year of project approval. Based on public comments and Board direction in March 2005, the current EIR exclusively focuses on Phase 1 (one additional well at existing test site within the next 1-2 years). Future EIRs will address Phases 2 and 3, once more information is known about regional land use plans and infrastructure. Also, the environmental document is now a combined EIR and Environmental Assessment (EA) to comply with the National Environmental Policy Act (NEPA), with the U.S. Army as federal lead agency.

The Phase 1 project is focused on better management of existing water resources to help reduce current impacts to the Carmel River and Seaside Basins. The District ASR project is viewed as being complementary to other larger, long-term water augmentation projects that are currently being explored by various entities. The Phase 1 ASR concept envisions a maximum diversion of 2,022 AFY from the Carmel River in wet years and a maximum extraction from the Seaside Basin of 1,690 AFY in dry periods. Average values would be lower and depend on long-term weather conditions. The Phase 1 values were based on 2004 or previous information, and are subject to change in the EIR based on recent technical studies and planned computer modeling.

The above-ground, near-term Cal-Am pipeline approved by the City of Seaside in June 2005 (see above) would deliver water to the Phase 1 ASR project in the near-term. Once the final location of the new General Jim Moore Boulevard (GJM) road alignment is approved, the fate of California American Water (Cal-Am) Coastal Water Project is known, and approval of specific land use proposals occurs, a meaningful plan for Phase 2 and 3 ASR, including permanent below-ground pipelines, can be formulated.

Other EIR/EA-related action in the April-June 2005 period included:

Ø Continued coordination with Cal-Am and permitting agencies, especially U.S. Army, FORA, and City of Seaside.

Ø Formally requested that U.S. Army initiate NEPA process; met with Army staff about project assumptions, time lines and tasks.

Ø Completed project description for proposed ASR well site, including preliminary engineering drawings; determined contiguous and non-contiguous alternative well and pipeline locations for co-equal analysis. Began assessments of direct and indirect construction and operation impacts.

Ø Completed assessment of Seaside Basin hydrologic impacts with proposed ASR well and alternatives.

Ø Recoded CVSIM computer model to reflect current “no project” conditions and proposed Phase 1 ASR operations.

Ø Began laying foundation for assessment of Carmel River hydrology and fishery impacts.

Ø EIR/EA schedule has slipped about 3 weeks.

Ø

Collaborate on Regional Water Supply Solutions

District staff continues to regularly coordinate with Monterey County Water Resources Agency (MCWRA) and Monterey Regional Water Pollution Control Agency (MRWPCA) on regional water supply solution opportunities. The District General Manager participates in regular meetings of water district and city technical staff regarding regional solutions to water problems. The District staff helped plan and participated in the May 19, 2005 AMBAG Regional Water Forum, and spoke about water supply alternatives at the June 22, 2005 forum titled Get on Board: A Citizen’s Role in Water Supply, Concerns & Alternatives, sponsored Save Our Shores, an ocean conservation organization headquartered in Santa Cruz.

At its June 16, 2005 meeting, the Board determined that it would hold a Town Hall meeting on potential water supply solutions on August 25, 2005. Project proponents have been invited to set up trade-show style displays, participate in a discussion panel, and/or provide updated information on their projects for inclusion in the District’s comparative matrix. The District has contacted the following entities about the event:

Ø California American Water (Coastal Water Project);

Ø City of Sand City (desalination);

Ø Marina Coast Water District (desalination);

Ø Monterey County Water Resources Agency (Regional Urban Water Supply Project);

Ø Monterey Regional Water Pollution Control Agency (groundwater recharge using recycled water);

Ø Pajaro/Sunny Mesa Community Services District (Moss Landing desalination).

Prepare Seaside Basin Groundwater Management Plan

Staff and consultants are preparing a long-term Seaside Basin Groundwater Management Plan (SBGMP) in compliance with protocols set by the State of California (AB 3030 as amended by SB 1938). On October 7, 2004, District staff met with an Advisory Committee comprised of major groundwater pumpers, agency officials, and stakeholders invited to participate in the process. In December 2004, the Board approved a formal public outreach program that commenced in 2005.

Complicating this task is litigation filed by Cal-Am on August 14, 2003. The suit asserts Cal-Am’s water rights and requests a Court adjudication of the Seaside Basin. The Cal-Am lawsuit involves issues of public concern such as: prioritization and quantification of water rights within the basin; rights to aquifer storage within the basin; rights to artificially introduce non-native water into the basin through direct injection or spreading grounds; a judicial determination that the basin is in overdraft; and the appointment of a water master to manage the basin water rights and resources. The District is a recognized interested party in the litigation, and has continued to participate in settlement meetings, mediation and other litigation activities during the April-June period.

On April 25, 2005, the District announced the availability of a new report on the status of the Seaside Groundwater Basin. The peer-reviewed report, Seaside Groundwater Basin – Update on Water Resource Conditions, was authored by expert consultants retained by MPWMD as part of the SBGMP. The report took over two years to prepare and provides an overview of previous studies and conclusions about the Seaside Basin. The report evaluates new information developed since the District’s last comprehensive report was prepared in 1997.

The technical report made important new findings and conclusions about the status of the Seaside Basin and sustainable water yield for the community. The analysis shows consistently declining water levels and deficit water budgets over an 8-year period, indicating that the Basin is in a state of overdraft since groundwater extractions exceed the sustainable yield. The reported outlines a range of potential actions to correct the problem. It is notable that ASR is an important tool to help address the overdraft condition.

A public review copy of the report is available at the District office; individual copies on CD may be purchased for $5. The report is also available on the MPWMD website: www.mpwmd.dst.ca.us.

Related SBGMP action in the April-June 2005 period included:

Ø Held May 5, 2005 public workshop for the District’s SBGMP Advisory Committee, comprised of Seaside Basin stakeholders, to review the Status of the Seaside Basin Report and answer questions.

Ø Held June 9, 2005 SBGMP Advisory Committee meeting to review the groundwater management planning process, develop management objectives and discuss stakeholder involvement. Monthly meetings are planned in the future.

Ø Continued to help Cal-Am develop management strategies to reduce extractions from the coastal basin during the wet season and determine which wells would be best to use as production from Seaside increases in the dry season. SWRCB Order WR 98-04 requires Cal-Am reductions in pumping from the Seaside Basin when Carmel River flow at the Highway 1 Bridge is greater than 40 cubic feet per second (cfs) from November 1 through April 30.

Ø Prepared extensive Proposition 50 grant application for planning and implementation grants in coordination with several agencies; includes ASR component as basin management tool.

Related Water Augmentation Activities

The following table summarizes related water augmentation efforts in the April-June 2005 period:

ACTIVITY	ACTION
Seismic Retrofit and Sediment Removal from San Clemente Reservoir.	District staff participates in the EIR/EIS process on the seismic retrofit of San Clemente Dam. Potential removal of sediment from San Clemente Dam continues to be explored by Cal-Am and the California Department of Water Resources (DWR). District staff participates in meetings and provides technical expertise upon request. Cal-Am maintains the water level of San Clemente Reservoir at 515 feet (10 feet below spillway elevation of 525 feet) pursuant to direction from DWR’s Division of Safety of Dams.
Implement and Refine Water Distribution System (WDS) Rules and Regulations.	District staff developed two ordinance concepts on ways to improve WDS regulations, which were approved by the District Board on August 16, 2004. The Board adopted Ordinance No. 118 refining procedures, fees and enforcement on December 13, 2004. Staff developed Conceptual Ordinance No. 122 for review by the Rules & Regulation Committee in April and May 2005; the Board approved the conceptual ordinance on May 16, 2005. Staff prepared an Initial Study and Proposed Negative Declaration for public circulation in June 2005. The first reading of Ordinance No. 122 will be considered on July 18, 2005. Staff and consultants continue to refine Implementation Guidelines and technical procedures to accompany the ordnances. Several applications were approved either by the Board or staff Hearing Officer in April-June 2005, and several more applications are currently at various stages in the permit process.
Review CEQA Documents for Other Projects	The District logs incoming CEQA notices and comments on selected documents prepared by other agencies for projects within the District boundary that could potentially affect water supply, water quality or environmental resources managed by the District.

U:\staff\word\boardpacket\2005\2005boardpackets\20050718\InfoItems\26\item26.doc