ITEM:		PUBLIC HEARINGS
22.	CONSIDER ADOPTION OF JANUARY THROUGH MARCH 2010 QUARTERLY WATER SUPPLY STRATEGY AND BUDGET
Meeting Date:			December 14, 2009	Budgeted:	N/A
From:			Darby Fuerst,	Program/	N/A
			General Manager	Line Item No.:
Prepared By:			Kevan Urquhart & Jonathan Lear	Cost Estimate:	N/A
General Counsel Review: N/A
Committee Recommendation: N/A
CEQA Compliance: Notice of Exemption, CEQA, Article 19, Section 15301 (Class 1)
ESA Compliance: Consistent with the 2001 Conservation Agreement and, 2009 Settlement Agreement 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 2010 Quarterly Water Supply Strategy and Budget for California American Water’s (CAW) Main and Laguna Seca Subarea Water Distribution Systems (WDS). The proposed budgets, which are included as Exhibits 22-A and 22-B, show monthly production by source of supply that is required to meet projected customer demand in CAW’s Main and Laguna Seca Subarea systems, i.e., Ryan Ranch, Bishop, and Hidden Hills, during the January through March 2010 period. The proposed strategy and budgets are designed to maximize the long-term production potential and protect the environmental quality of the Seaside Groundwater and Carmel River Basins.

Exhibit 22-A shows the anticipated production by CAW’s Main system for each production source and the actual production values for the Water Year (WY) 2010 to date through the end of November 2009. Please note that the anticipated production values assume that CAW annual main system production will not exceed 14,868 acre-feet (AF), including 3,583 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. The total from the Seaside Groundwater Basin is consistent with the Seaside Basin adjudication decision, and includes 496 AF of “Carryover Credit” from WY 2009 that CAW was allowed to produce, but did not produce that year due to mechanical problems with some of its Seaside Coastal wells. For the purpose of this budget, it is conservatively assumed that below normal inflow conditions will occur.

Exhibit 22-B shows the anticipated production by CAW’s Laguna Seca Subarea system for each production source and the actual production values for the water year to date through the end of November 2009. Please note that the anticipated production values assume that CAW’s annual Laguna Seca Subarea systems’ production for WY 2010 will not exceed 246 AF from the Laguna Seca Subarea of the Seaside Groundwater Basin. This total is consistent with the Seaside Basin adjudication decision.

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. 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 budgets are described in greater detail in Exhibit 22-C, Quarterly Water Supply Strategy Report: January – March 2010.

BACKGROUND: The Quarterly Water Supply Strategy and Budget pertains to production within CAW’s Main and Laguna Seca Subarea systems for the three-month period of January, February, and March 2010. Staff from the District, CAW, and California Department of Fish and Game (CDFG), cooperatively developed this strategy on December 3, 2009. Based on current reservoir and Carmel Alluvial Aquifer storage conditions, the early rainfall in October 2009, and early season runoff projections, it was agreed that “below normal” year inflows would be used to conservatively assess CAW’s operations and set monthly production targets for CAW’s systems.

To meet customer demand in its main system, CAW intends to avoid producing any groundwater from its wells in the Upper Carmel Valley during January through March 2010, and will focus instead on producing approximately 1,215, 1,198, and 1,368 AF of groundwater from its wells in the Lower Carmel Valley during January, February, and March 2010, respectively. Of this production, it is assumed that 265, 330, and 370 AF would be diverted from the Carmel River and injected for storage into the Seaside Groundwater Basin during the January through March 2010 period.

It was also agreed that, subject to rainfall and runoff conditions in the Carmel River Basin, CAW would produce no water from the Coastal Subareas of the Seaside Basin during this period and would allow the basin to naturally recharge. In addition, it was also agreed that CAW would produce 11, 10, and 14 AF of groundwater from its wells in the Laguna Seca Subarea for its customers in the Ryan Ranch, Bishop, and Hidden Hills systems during this period. Lastly, it was agreed that CAW would not divert any water from San Clemente Reservoir through the Carmel Valley Filter Plant during this quarter. CAW will operate its wells in the Lower Carmel Valley 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.

It should be noted that the projected monthly demands used in Exhibit 22-A to represent customer service in Cal-Am’s main system for the January through March 2010 period differ from those discussed at the December 3, 2009 Quarterly Budget meeting. The values have been increased to match the monthly production targets that are recommended for Board approval. Accordingly, these recommended targets do not include reductions in Cal-Am’s diversions from the Carmel River that are specified in from the Carmel River that are specified in State Water Resources Control Board Order WR 2009-0060. The reductions are not included in the monthly targets because the order has been stayed by Monterey County Superior Court.

EXHIBITS

22-A Quarterly Water Supply Strategy and Budget for CAW Main System: January - March 2010

22-B Quarterly Water Supply Strategy and Budget for CAW Laguna Seca Subarea: January - March 2010

22-C Quarterly Water Supply Strategy and Budget Report: January – March 2010

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