ITEM:		CONSENT CALENDAR
2.	AUTHORIZE AGREEMENT WITH CALIFORNIA AMERICAN WATER FOR REIMBURSEMENT OF CARMEL RIVER MITIGATION
Meeting Date:			March 31, 2011	Budgeted:	N/A
From:			Darby Fuerst,	Program/	N/A
			General Manager	Line Item No.:
Prepared By:			Darby Fuerst	Cost Estimate:	N/A
General Counsel Review: Yes
Committee Recommendation: N/A
CEQA Compliance: N/A

SUMMARY: On March 24, 2011, the California Public Utilities Commission (CPUC) denied California American Water’s (Cal-Am) application to reinstate the District’s user fee on Cal-Am’s monthly bills and authorized Cal-Am to file an amended application within 60 days with a joint program proposal for MPWMD to perform Carmel River Mitigation measures and fund a portion of the Aquifer Storage and Recovery (ASR) Project. District and Cal-Am staff have been meeting to develop the joint program proposal and an interim reimbursement agreement to provide funding to the District for performing the mitigation measures during the period when Cal-Am’s application is pending. The proposal and agreement are scheduled to be completed by May 23, 2011, and will be considered by the Board at its May 16, 2011 meeting. In the period between March 24 and May 23, 2011, Cal-Am has agreed to withdraw its January 6, 2011 Notice of Intent to Terminate Reimbursement Agreement letter (Exhibit 2-A) and submit a revised letter extending the September 24, 2011 Reimbursement Agreement between Cal-Am and the District (Exhibit 2-B) through May 23, 2011, consistent with the CPUC decision. At that time, Cal-Am’s MPWMD User Fee Memorandum Account will be closed and Cal-Am is authorized to amortize the amount in the account over a 12-month period. Cal-Am’s revised letter extending the existing reimbursement agreement is included as Exhibit 2-C.

RECOMMENDATION: Staff recommends that the Board authorize the General Manager to accept Cal-Am’s proposal to extend the September 24, 2011 Reimbursement Agreement between Cal-Am and the District for Mitigation and ASR Activity Expenses through May 23, 2011.

EXHIBITS

2-A January 6, 2011 letter from Cal-Am regarding Reimbursement Agreement for Mitigation and ASR Activity Expenses; Notice of Intent to Terminate Reimbursement Agreement for Convenience; Request to Meet and Confer on Modification to Reimbursement Agreement

2-B September 24, 2011 Agreement between MPWMD and Cal-Am regarding Reimbursement for Mitigation and ASR Activity Expenses

2-C March 30, 2011 letter from Cal-Am Amending Notice of Intent to Terminate Reimbursement Agreement for Convenience

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