ITEM:		PUBLIC HEARING
13.	CONSIDER ADOPTION OF JANUARY THROUGH MARCH 2012 QUARTERLY WATER SUPPLY STRATEGY AND BUDGET
Meeting Date:			December 12, 2011	Budgeted:	N/A
From:			David J. Stoldt,	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, 2009 Settlement Agreement between the National Marine Fisheries Service and California American Water to minimize take of listed steelhead in the Carmel River, and SWRCB WR Order Nos. 95-10, 98-04, 2002-0002, and 2009-0060.

SUMMARY: The Board will accept public comment and take action on the January through March 2012 Quarterly Water Supply Strategy and Budget for California American Water’s (Cal-Am’s) Main and Laguna Seca Subarea Water Distribution Systems (WDS). The proposed budget, which is included as Exhibit 13-A and 13-B, shows monthly production by source of supply that is required to meet projected customer demand in Cal-Am’s Main and Laguna Seca Subarea systems, i.e., Ryan Ranch, Bishop, and Hidden Hills, during the January through March 2012 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 13-A shows the anticipated production by Cal-Am’s Main system for each production source and the actual production values for Water Year (WY) 2012 to date through the end of November 2011. Please note that the anticipated production values for customer service assume that Cal-Am’s annual Main system production for Water Year (WY) 2012 will not exceed 12,977 acre-feet (AF), which is comprised of 2,669 AF from the Coastal Subareas of the Seaside Groundwater Basin, 300 AF from the Sand City Desalination Plant, and 10,008 AF from the Carmel River Basin (comprised of 1,117 AF of ASR Phase 1 recovery and 8,891 AF of direct diversion). The total from the Carmel River Basin is consistent with State Water Resources Control Board (SWRCB) Order No. 95-10, 98-04, 2002-0002 and 2009-0060; and the total from the Seaside Groundwater Basin is consistent with the Seaside Basin adjudication decision. In December 2011, the Seaside Watermaster determined there was 32 AF of native groundwater not produced by Cal-Am under the Seaside Basin Adjudication Decision in WY 2011, and this water will carryover to WY 2012. The 32 AF carryover will be applied to the next quarterly water budget. The “Carryover Credit” from WY 2011 is water that Cal-Am was allowed to produce, but did not produce that year due to physical constraints within its existing delivery system. For the purpose of this budget, it is conservatively assumed that normal inflow conditions will occur for the rest of the Water Year.

Exhibit 13-B shows the anticipated production by Cal-Am’s Laguna Seca Subarea systems for each production source and the actual production values for WY 2012 to date through the end of November 2011. Please note that the budgeted production values assume that Cal-Am’s annual Laguna Seca Subarea systems’ production for WY 2012 will not exceed 147 AF from the Laguna Seca Subarea of the Seaside Groundwater Basin. This total is consistent with the Seaside Basin adjudication decision.

If streamflow in the Carmel River exceeds the instream flow requirements specified by National Marine Fisheries Service (NMFS), a portion of the “excess” groundwater may be diverted from the Carmel River Alluvial Aquifer by Cal-Am for injection into the Seaside Groundwater Basin as part of the Phase 1 and Phase 2 ASR Project. The amount of water diverted from the Carmel River Alluvial Aquifer that is treated and delivered for injection will also depend on customer demand and Cal-Am production system availability 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 13-C, Quarterly Water Supply Strategy Report: January – March 2012.

BACKGROUND: The Quarterly Water Supply Strategy and Budget pertains to production within Cal-Am’s Main and Laguna Seca Subarea systems for the three-month period of January, February, and March 2012. Staff from the District, Cal-Am, and California Department of Fish and Game (CDFG), cooperatively developed this strategy on December 8, 2011. Staff from the National Marine Fisheries Service (NMFS) were unable to attend, but were consulted by phone for their approval. Based on current reservoir and Carmel River Alluvial Aquifer storage conditions, the higher than average base river flows in October and November 2011, it was agreed that “normal” year inflows would be used to conservatively assess Cal-Am’s operations and set monthly production targets for Cal-Am’s systems.

To meet customer demand in its main system, Cal-Am intends to avoid producing any groundwater from its wells in the Upper Carmel Valley during January through March 2012, and will focus instead on producing approximately 1,020, 1,037, and 1,202 AF of groundwater from its wells in the Lower Carmel Valley during January, February, and March 2012, respectively. Of this production, it is assumed that 230, 300, and 340 AF would be diverted from the Carmel River Alluvial Aquifer and injected for storage into the Seaside Groundwater Basin during the January through March 2012 period. These latter targets are based on the long-term average diversion rate for Phase 1 and half of the Phase 2 ASR capacity, predicted by average values from the Carmel Valley Simulation Model (CVSIM) for that month.

It was also agreed that, subject to rainfall and runoff conditions in the Carmel River Basin, Cal-Am would produce no water from the Coastal Subareas of the Seaside Basin during this period, except for 25 AF per month from the Sand City Desalination Plant, and would allow the basin to naturally recharge. In addition, it was also agreed that Cal-Am would plan to produce only 7, 6, and 9 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 Cal-Am would not divert any water from San Clemente Reservoir through the Carmel Valley Filter Plant during this quarter. Cal-Am 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.

EXHIBITS

13-A Quarterly Water Supply Strategy and Budget for Cal-Am Main System: January - March 2012

13-B Quarterly Water Supply Strategy and Budget for Cal-Am Laguna Seca Subarea: January - March 2012

13-C Quarterly Water Supply Strategy and Budget Report: January – March 2012

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