ITEM:		PUBLIC HEARINGS
18.	CONSIDER ADOPTION OF JANUARY THROUGH MARCH 2008 QUARTERLY WATER SUPPLY STRATEGY AND BUDGET
Meeting Date:			December 10, 2007	Budgeted:	N/A
From:			David A. Berger,	Program/	N/A
			General Manager	Line Item No.:
Prepared By:			Darby Fuerst	Cost Estimate:	N/A
General Counsel Approval: N/A
Committee Recommendation: N/A
CEQA Compliance: Notice of Exemption, CEQA, Article 19, Section 15301 (Class 1)
ESA Compliance: Consistent with the September 2001 and June 2006 Conservation Agreements between the National Marine Fisheries Service and California American Water to minimize take of listed steelhead in the Carmel River and Consistent with SWRCB WR Order Nos. 95-10, 98-04, and 2002-0002.

SUMMARY: The Board will accept public comment and take action on the January through March 2008 Quarterly Water Supply Strategy and Budget for the California American Water (CAW) main Water Distribution System (WDS). The proposed budget, which is included as Exhibit 18-A, shows the monthly production, by source of supply, that is required to meet projected customer demand in CAW’s main system during the January through March 2008 period. The proposed strategy and budget is designed to maximize the long-term production potential and protect the environmental quality of the Seaside Groundwater and Carmel River Basins.

Exhibit 18-A shows the anticipated production by CAW for each production source and the actual production values for the water year to date through the end of November 2007. Please note that the anticipated production values assume that CAW annual main system production will not exceed 14,789 acre-feet (AF), including 3,504 AF from the coastal subareas of the Seaside Groundwater Basin and 11,285 AF from the Carmel River Basin. The total from the Carmel River Basin is consistent with State Water Resources Control Board (SWRCB) Order No. 95-10 and the total from the Seaside Groundwater Basin is consistent with the Seaside Basin adjudication decision. For the purpose of this budget, it is conservatively assumed that critically-dry inflow conditions will persist and no water from the Carmel River Basin will be diverted and injected into the Seaside Groundwater Basin during the January through March 2008 period.

It should be noted that, because of the uncertainty associated with predicting rainfall and runoff for the upcoming winter quarter, the anticipated monthly production may change. Specifically, if the rainfall and runoff amounts in the Carmel River Basin are greater than projected under the assumed dry conditions, then the projected production from the Seaside Basin will be curtailed and production from sources in the Carmel River Basin will be increased to meet customer demand. Similarly, if rainfall and runoff amounts are greater than projected and streamflow in the Carmel River exceeds the instream flow requirements specified by National Marine Fisheries Service (NMFS), a portion of the “excess” water will be diverted by CAW for injection into the Seaside Groundwater Basin as part

of the Phase 1 ASR Project. The amount of water diverted from the Carmel River that is treated and delivered for injection will also depend on customer demand and the condition of CAW’s wells in the Carmel Valley at that time.

RECOMMENDATION: The Board should receive public input, close the Public Hearing, and discuss the proposed quarterly water supply budget. District staff recommends adoption of the proposed budget. The budget is described in greater detail in Exhibit 18-B, Quarterly Water Supply Strategy Report: January – March 2008.

BACKGROUND: The Quarterly Water Supply Strategy and Budget pertains to production within CAW’s main WDS for the three-month period of January, February, and March 2008. Staff from the District, CAW, California Department of Fish and Game (CDFG), and the National Marine Fisheries Service (NMFS) cooperatively developed this strategy on November 28, 2007. Based primarily on the conservative assumption that “critically-dry” inflows will continue during the January through March 2008 period and that the “low-flow” restrictions on CAW’s operations in the Upper Carmel Valley (UCV) will be in effect, it was agreed that CAW would produce no more than 31, 29 and 31 AF in January, February, and March from its wells in the UCV, respectively. In addition, it was agreed that CAW would produce approximately 150, 50 and 0 AF in January, February, and March from its wells in the Coastal Subareas of the Seaside Groundwater Basin during this period, respectively. The projected diversions from the UCV reflect the maximum production allowed during the defined low-flow period. The projected production from the Coastal Subareas of the Seaside Basin during January, February, and March reflects the assumption that there will be cooler temperatures and reduced customer demand. Ideally, during this period, CAW would cease production from the Coastal Subareas and allow the basin to recharge. However, due to the possibility of continued dry conditions and production limitations in the Lower Carmel Valley (LCV), some production from the Seaside Basin may be needed and is projected for January and February. If normal rainfall occurs, then CAW’s production from the Coastal Subareas of the Seaside Basin in January and February will be shifted to the LCV.

It was also agreed that CAW would not divert any water from San Clemente Reservoir through the Carmel Valley Filter Plant during this quarter. The remainder of the water needed to meet projected customer demand would be provided by CAW’s wells in the LCV. Specifically, it was agreed that Cal-Am would produce 760, 788, and 968 AF from its LCV wells in January, February, and March, respectively. CAW will operate its wells in the LCV in a downstream-to-upstream order. If actual inflows are more or less than projected for the budget period, the group will reconvene and adjust the diversion and release rates accordingly.

Rule 101, Section B of the District Rules and Regulations requires that a Public Hearing be held at the time of determination of the District water supply management strategy. Notice of this Public Hearing has been published in The Herald. Adoption of the quarterly water supply strategy and budget is categorically exempt from the California Environmental Quality Act (CEQA) requirements as per Article 19, Section 15301 (Class 1). A Notice of Exemption will be filed with the Monterey County Clerk's office, pending Board action on this item.

EXHIBITS

18-A Quarterly Water Supply Strategy and Budget: January - March 2008

18-B Quarterly Water Supply Strategy and Budget Report: January – March 2008

U:\staff\word\boardpacket\2007\2007boardpackets\20071210\PubHrgs\18\item18.doc