ITEM:		CONSENT CALENDAR
6.	CONSIDER APPROVAL OF CALIFORNIA AMERICAN WATER IMPLEMENTATION AGREEMENT FOR THE CARMEL RIVER MITIGATION PROGRAM COVERING CALENDAR YEARS 2013 AND 2014
Meeting Date:			May 20, 2013	Budgeted:	Yes
From:			David J. Stoldt,	Program/	Revenue
			General Manager	Line Item No.:	Mitigation Program
Prepared By:			Suresh Prasad	Cost Estimate:
General Counsel Approval: N/A
Committee Recommendation: The Administrative Committee reviewed this item on May 13, 2013 and recommended approval.
CEQA Compliance: N/A

SUMMARY: District staff and counsel have worked with California American Water (Cal-Am) staff and counsel to develop an extension of the existing interim reimbursement agreement to provide Cal-Am funding to continue the District’s Mitigation Program. The extended agreement will cover the District’s Mitigation Program for calendar years 2013 and 2014. A copy of the Implementation Agreement for the Carmel River Mitigation Program covering Calendar Years 2013 and 2014 (Carmel River Mitigation Agreement) is included as Exhibit 6-A.

RECOMMENDATION: District staff recommends that the Board authorize the General Manager to execute the Carmel River Mitigation Agreement between Cal-Am and the District for calendar years 2013–2014 Mitigation Program. The Administrative Committee reviewed this item at its May 13, 2013 meeting and recommended approval by a vote of 2 to 0.

BACKGROUND: Since 1990, the District has implemented a comprehensive Mitigation Program to lessen the environmental impacts resulting from community water use and Cal-Am diversions from the Carmel River and Seaside Groundwater Basins. The Mitigation Program has been funded primarily by a user fee that Cal-Am collected and remitted to the District. In July 2009, the CPUC ordered Cal-Am to discontinue collection and remittance of the District’s user fee and directed Cal-Am to file an application addressing the manner in which the Mitigation Program was funded. In January 2010, Cal-Am filed the requested application, which included an all-party all-issue settlement agreement. In March 2011, the CPUC rejected the settlement agreement and directed Cal-Am to file an amended application. In June 2012, the CPUC authorized Cal-Am to enter into Interim Implementation Agreement with MPWMD to provide funding for Carmel River Mitigation Program through December 2014. To ensure that the Mitigation Program continues, Cal-Am and the District have developed an extension to the interim reimbursement agreement that will provide approximately $1.76 million for 2013 and $1.94 million for 2014 to continue the Mitigation Program. Condition 11 of State Water Resources Control Board (SWRCB) Order No. 95-10 specifies that Cal-Am shall be responsible for implementing all measures in the “Mitigation Report for the District’s Water Allocation Program Environmental Impact Report” not implemented by the District. Condition 9 of SWRCB Order No. 2009-0060 (2009 Cease and Desist Order) also requires Cal-Am to comply with all requirements of Order 95-10, including Condition 11. The activities that will be funded under the Carmel River Mitigation Agreement are summarized in the exhibits to the agreement.

The Carmel River Mitigation Agreement will provide funding to continue the core activities of the Mitigation Program. As proposed, no funding will be provided for additional work at the Water Project 1 site (Phase 1 Aquifer Storage and Recovery site) or for water conservation activities.

EXHIBIT

6-A Implementation Agreement for the Carmel River Mitigation Program

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