ITEM:		PUBLIC HEARING
19.	CONSIDER SECOND READING AND ADOPTION OF ORDINANCE NO. 142 – AN ORDINANCE OF THE BOARD OF DIRECTORS OF THE MONTEREY PENINSULA WATER MANAGEMENT DISTRICT AMENDING REGULATION XV, THE EXPANDED WATER CONSERVATION AND STANDBY RATIONING PLAN, TO ALLOW AN EXCEPTION TO THE MANDATORY REQUIREMENT FOR IMPLEMENTION OF STAGE 5, 6, OR 7 WHEN A FINAL CEASE AND DESIST ORDER IS ISSUED
Meeting Date:			January 28, 2010	Budgeted:	N/A
From:			Darby Fuerst,	Program/	N/A
			General Manager	Line Item No.:
Prepared By:			Stephanie Pintar	Cost Estimate:	N/A
General Counsel Review: Yes
Committee Recommendation: By a vote of 3-0 on December 7, 2009, the Water Demand Committee recommended the Board adopt the ordinance through the regular process. The District’s Technical Advisory Committee (TAC) and the Policy Advisory Committee (PAC) reviewed and supported the ordinance on November 30, 2009 as a non-urgency ordinance.
CEQA Compliance: The ordinance is exempt under CEQA Section 15301, Existing Facilities and Section 15321-b-2, Project

SUMMARY: Ordinance No. 142 (Exhibit 19-A) modifies the automatic triggers required by the District’s existing Expanded Water Conservation and Standby Rationing Plan (Regulation XV). The modifications (to Rules 165 (Stage 5 Water Rationing), 166 (Stage 6 Water Rationing) and 167 (Stage 7 Water Rationing)) allow the General Manager to forestall implementation of specified rationing stages in place of a lower Stage of the plan when there is evidence that implementation of a lesser Stage would be sufficient to achieve regulatory compliance. Stage 5 is the first water rationing stage that automatically takes effect when a final Cease and Desist Order (CDO) is issued requiring reductions of more than 15 percent but less than 35 percent of base year use. The CDO issued against California American Water (Cal-Am) by the State Water Resources Control Board (SWRCB) in October 2009 would have triggered Stage 5 if a court-ordered stay had not suspended the action. Automatic regulatory triggers also exist in Stages 6 and 7; each automatic trigger requires the District to implement that Stage of water rationing when there is a final CDO that mandates water supply targets associated with that Stage.

The proposed ordinance provides a mechanism for the General Manager to implement a lower conservation or rationing stage when credible evidence shows that the community is likely to achieve compliance with regulatory production limits. At this time, evidence supports a position that production during this water year shall comply with the CDO without the need to implement Stage 5 water rationing. This potential is supported by the last year’s production, imposition of new rates that will discourage high use, and a plan to focus on high outdoor water users, rather than all Cal-Am customers. The proposed ordinance allows the General Manager to declare a rationing Stage by memorandum, but the decision is appealable to the Board.

Ordinance No. 142 has been reviewed by the PAC/TAC and the Water Demand Committee. All three committees unanimously supported the ordinance and recommended that it be considered without urgency. California American Water (CAW) and the Division of Ratepayer Advocates of the California Public Utilities Commission also support the ordinance. CAW will modify its Rule 14.1.1 to match the District’s action upon adoption of the ordinance.

RECOMMENDATION: Staff recommends the Board approve the second reading and adoption of Ordinance No. 142. This ordinance is exempt from CEQA, and the proper notice will be filed with the County Clerk upon adoption. The ordinance takes effect on March 1, 2010.

IMPACT ON STAFF/RESOURCES: The cost and impact of rationing on the community is high. Beyond the cost of labor and overhead to run a rationing program, rationing triggers unavoidable economic costs, particularly to local businesses who may not qualify for rationing variances and to jurisdictions who have planned use of their remaining water allocations. To avoid water rationing (and the corresponding moratorium) at the outset, staff is proposing interim measures that will reduce demand and ideally maintain water demand below regulatory limits.

EXHIBITS

19-A Draft Ordinance No. 142

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