EXHIBIT 17-B

FINAL MINUTES

Water Supply Planning Committee Meeting of the

Monterey Peninsula Water Management District

September 13, 2010

Call to Order

The meeting was called to order at 8:30 a.m. in the District conference room.

Committee members present: Bob Brower, Chair

Alvin Edwards

Kristi Markey (arrived at 8:40 a.m.)

Staff present: Darby Fuerst, General Manager

Andy Bell, Planning & Engineering Manager/District Engineer

Joe Oliver, Water Resources Manager

Jonathan Lear, Senior Hydrogeologist

Arlene Tavani, Executive Assistant

District Counsel present: Heidi Quinn

Comments from Public

No comments.

Discussion Items

1. Update on Potential Water Projects Including Desalination

A. Desalination Projects

Bell reported that he and General Manager Fuerst met with Sand City Manager, Steve Matarazzo regarding development of another desalination project in Sand City. Matarazzo was opposed to use of lots in Sand City for several reasons: (a) potential adverse affects on Sand City Desalination project; (b) assertion that Sand City has a right to brackish water in upper zone of the Aromas Sands Aquifer; and (c) loss of tax revenue on any additional lots utilized for a water project. The committee requested that District Counsel determine if Sand City does have an exclusive right to use of brackish water in the upper zone of the Aromas Sands Aquifer. The committee agreed that staff should investigate the possibility of open ocean intake. Bell will schedule a meeting with representatives from the Naval Postgraduate School regarding use of the abandoned City of Monterey wastewater treatment plant site for an open ocean intake desalination project. At the October committee meeting, Bell will present a report on the findings of his investigation.

2. Progress Report on Aquifer Storage and Recovery Project

Oliver reported the following. Phase 1 ASR – Construction of the electrical/facilities building for the Phase 1 ASR site should be complete by late October or early November 2010. The existing easement for access to the well site will need to be enlarged (additional 50 x 300 square feet), in order to plan for the eventual increase in the number of delivery pipes related to Phase 2 of the ASR project. California American Water (Cal-Am) has approached the City of Seaside for the easement. The property belongs to FORA but will be ceded to the City of Seaside. A determination must be made as to which entity will receive compensation for the expanded easement. The committee directed that landscaping and paving at the site be delayed until District staff has resolved the easement issues, and that the District should fund the easement. Staff has scheduled a meeting to coordinate with Cal-Am on the first injection of ASR water into the distribution system for customer use. Phase 2 ASR – Cal-Am is working with the Monterey Peninsula Unified School District on procuring a long-term lease on the Seaside Middle School site for continued use of the test well, and potential development of a second well. Cal-Am will reimburse the District for the cost to install the test well. Fuerst noted that the protest filed by National Marine Fisheries Service on the District’s water rights permit for Phase 2 ASR has been resolved.

3. Report on Potential for Increasing Capacity of Los Padres Reservoir

Bell reported that Cal-Am is opposed to any modification of the Los Padres Dam or Reservoir. The committee requested that staff provide an update on this issue in March 2011.

4. Update on Status of San Clemente Dam Removal/Reroute Proposal

The committee reviewed the staff report. There was a consensus on support for the project.

5. Update on Development of Recycled Wastewater Alternatives

Fuerst reported that he spoke with Keith Israel, General Manager of the Monterey Regional Water Pollution Control Agency about the status of the Groundwater Replenishment (GRP) and Regional Urban Water Augmentation (RUWAP) projects. State funds are available for the RUWAP, but given the high cost of the water, there are concerns about potential demand. The agency is prepared to begin planning for development of the GRP. Israel will provide an update to the Board of Directors at the September 20, 2010 meeting.

Other Items

No discussion of other items to report.

Schedule Next Meeting Date

The next meeting was scheduled for October 11, 2010, at 9 a.m.

Adjournment

The meeting adjourned at 10:05 a.m.

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