The Board discussed the proposed agreement and requested that District staff contact California American Water about renegotiating the agreement to address the following issues: (1) clarify that the license is not assignable and would revert to the District; (2) specify a 15 year licensing period; (3) clarify the return on equity limitation; (4) identify ownership of ASR water rights; (5) present two options to the Board for settling disputes, litigation and arbitration; (6) specify the District’s intent to support future ASR projects that are jointly undertaken with Cal Am; (7) delete any reference that connects the District’s ASR project to the Coastal Water Project. A date for Board consideration of the renegotiated agreement was not specified. David Dilworth addressed the Board during the public comment period on this item. According to Mr. Dilworth, an agreement with Cal Am is not necessary because the District could operate the ASR project as a water distribution system. He urged the Board to delete the requirement for arbitration because those sessions would be closed to the public. He also suggested that CEQA review should be completed on the proposed MOA. The Board discussed various methods of determining who has the authority to place items on committee or Board meeting agendas. The consensus was that each month the Chair and Vice Chair will review proposed agenda items and assign them to a committee or place them on the Board meeting agenda for consideration. The Board would like to see a charge developed for each committee sometime in the future, but that is not a priority task. The meeting was adjourned at 9:45 PM.

2. Discuss Proposed Agreement with California American Water Regarding Management and Operation of Seaside Basin Aquifer Storage and Recovery Facilities 3. Clarify Authority of Chairperson, Officers and Board Committees ADJOURNMENT

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David A. Berger, Secretary to the Board