ITEM: 

ACTION ITEM  

 

20.

CONSIDER CHANGES TO MPWMD RULES AND REGULATIONS FOR WATER DISTRIBUTION SYSTEM PERMITS

 

Meeting Date:
November 18, 2013

Budgeted: 

N/A

 

From:

David J. Stoldt,

Program/

N/A

 

General Manager

Line Item No.:

N/A

 

 

 

Prepared By:

Henrietta Stern

Cost Estimate:

N/A

 

General Counsel Review:  Provided guidance to staff

Committee Recommendation:  The Rules & Regulations Review Committee concurred that the Board should receive the staff recommendation.

CEQA Compliance:  N/A  Concept review

 

 

 

SUMMARY:  The Board will consider staff’s recommendation concerning options for changing the MPWMD Rules & Regulations regarding Water Distribution Systems (WDS). Staff is requesting Board direction on changes to the Rules that would reduce the regulatory burden for property owners, eliminate duplication between MPWMD and Monterey County, and bring the District’s Rules into conformance with generally accepted legal theories concerning rights to percolating groundwater.   If the Board directs staff to change WDS Rules, , a new ordinance to comprehensively amend District Rules (primarily Rules 20, 21 and 22) will be presented to the Board in early 2014, which would include California Environmental Quality Act (CEQA) review. 

 

The Board’s Strategic Plan Update adopted on April 15, 2013 included a goal to evaluate and revise the WDS regulations, including:

 

·         assess District interests and overall goals;

·         identify benefits to the District and to customers;

·         explore alternative frameworks;

·         assess which target areas need most regulation;

·         recommend amendments to rules; and

·         consider more exemptions.

 

The Board desired a more streamlined and “user-friendly” process.   During a review of the existing WDS Permit process, it was determined that the District’s authority to set System Limits (production and connection limits) is narrower than previously thought.  In addition, Monterey County is also assessing and revising its Well Ordinance; District and County staff are coordinately closely to ensure that new or revised regulations proposed by each agency do not conflict and avoid duplication.   More information is provided in the “BACKGROUND” section below.

 

Exhibit 20-A is Table 22-A from the current MWPMD Rule 22; it is a complex matrix of well location, parcel size, water production, land use and number of parcels served used to determine procedures for issuing a WDS permit.  Staff proposes to eliminate parcel size and water use as a determining factor for issuing exemptions for three or fewer parcels in locations that would not affect the Monterey Peninsula Water Resource System (MPWRS)[1].  In addition, the permit process for applications for four or more parcels could be simplified under certain circumstances.  It should be noted that no changes are proposed for applications that could affect the MPWRS.  Exhibit 20-B is a simplified table summarizing staff’s proposal for changing the WDS permit process.  Exhibit 20-C is a series of tables that represents the staff-proposed “regulatory roadmap.”   These are described more fully in the “DISCUSSION” section below.

 

The staff proposal would:

·         simplify the decision matrix on how to process an application;

·         delete the Pre-Application step;

·         expand exemptions for new facilities that are located outside of the MPWRS;

·         cease setting baseline limits for existing non-MPWRS systems that qualify for an exemption;

·         scrutinize non-MPWRS facilities located within a defined buffer zone (presently 1,000 feet) adjacent to the CVAA or other Sensitive Environmental Receptor (SER)[2] to ensure there is no adverse effect;

·         revise the District definition of a SER to include three additional tributaries to the Carmel River: Cachagua Creek, Pine Creek, and San Clemente Creek;

·         reserve the setting of System Limits (annual production and connection limits) and more detailed testing for a WDS Permit  for facilities within the MPWRS or that could affect the MPWRS;

·         include a process for non-well situations (e.g., desalination plants, springs, or trucked-in water);

·         designate staff (General Manager or his designee) to process all applications administratively, except complex or large projects; and

·         include a provision that all staff decisions can be appealed to the Board.

 

Two alternative policy options were presented to the Rules & Regulations Review Committee at its October 28, 2013 meeting:  (1) less regulation, similar to the Rules that were in effect before Ordinance No. 96 was adopted in 2001; and (2) regulation similar to the current situation, except production limits would not be set for facilities outside of the MPWRS.  The committee recommended that only the staff proposal be submitted to the Board.  Please refer to the District website under the “Meetings” topic for materials submitted to the Committee.   

 

RECOMMENDATION:  The Board should take the following actions:

·         Consider approving staff’s conceptual proposal for revisions to the WDS regulations (or identify other desired changes);

·         If appropriate, direct staff to prepare a comprehensive draft ordinance in consultation with the Rules & Regulations  Review Committee and Monterey County technical staff;

·         Direct staff to conduct a CEQA review on the first reading version of the proposed new ordinance for Board consideration; and

·         Provide the General Manager the discretion to waive the setting of System Limits for non-MPWRS applications in progress that do not affect Sensitive Environmental Receptors until the new WDS Rules are adopted.

 

Staff believes the proposed conceptual changes would: 1) make the WDS process more streamlined and reduce duplication of effort between agencies; 2) comply with the District enabling legislation (District Law); 3) address concerns about the District’s authority to set System Limits in certain situations; 4) be consistent with changes being considered for Monterey County’s well regulations; and 5) comply with the District’s mandate to protect water resources of the Monterey Peninsula. 

 

BACKGROUND:  The District has comprehensive authority to integrate management of the ground and surface water resources in the Monterey Peninsula area.  This includes a written permit system to regulate WDS, regardless of the number of connections served or the source of the water supply.  District Rule 11 defines the terms used in the regulation of WDS and Mobile WDS.  District Rules 20, 21, 22, 40, 54, 55, 56, 60, 114 and 173 further define procedural and substantive rules that regulate these systems.  The first regulation was enacted with Ordinance No. 1 in February 1980.  Significant refinements, changes and additions to the WDS Rules and Regulations were adopted as part of Ordinance No. 96 in 2001.  Since then, the WDS Rules have been refined through Ordinance No. 105, 106, 118, 122, 127, 128, 136, 145 and 150.   The MPWMD Rules & Regulations are provided on the District website.

 

At its July 22, 2013 meeting, the District Board adopted Resolution 2013-12, due in part to a revised understanding of District authority to set System Limits in certain situations in non-MPWRS settings.  The Resolution directed the General Manager to suspend for one year several actions for Fractured Rock Wells located on a single parcel until the WDS regulations could be amended.  The District would not: (a) set System Limits, (b) require hydrogeologic testing above and beyond the standard testing required by the Monterey County Health Department, and (c) perform other MPWMD staff activities relevant to setting a System Limit.   More information is provided in the staff note on the District website (see Board Meetings). 

 

Legal Issues:  District Law gives MPWMD the authority to regulate water producing facilities within its boundaries.  Water Code Appendix 118-363 states that a written permit from the MPWMD Board is needed to create, establish, extend or expand a WDS, with various rules and regulations to guide that process.  Further, it states that “The board may provide by ordinance for exceptions to the requirement for approval for systems furnishing domestic water to three or fewer parcels or lots in the District.”  Thus, an exemption may be given for a WDS serving three or fewer parcels, but a WDS serving four or more parcels must obtain a WDS Permit.  MPWMD Rule 20-C describes several conditions under which facilities could be exempt from the need to obtain a WDS Permit; however, prior to adoption of Resolution 2013-12, MPWMD set production limits for all exemptions.

 

District staff does not believe the District has the authority to set System Limits for most non-MPWRS water producing facilities.  As part of the Board’s consideration of Resolution 2013-12 on July 22, 2013, and at the Rules & Regulations Review Committee on October 28, 2013, District Counsel explained that MPWMD has the authority to regulate wells within its boundaries, including requiring a WDS Permit (or Confirmation of Exemption).  However, for most non-MPWRS situations, which rely on correlative water rights that are shared among overlying basin property owners, Counsel believes that MPWMD does not have the authority to set System Limits in the absence of evidence of overdraft or some physical or legal constraint affecting a specific water body.  In addition, MPWMD has the authority to require additional hydrogeologic testing for non-MPWRS facilities that could potentially impact the CVAA or the Seaside Groundwater Basin.  In these situations, the District has the authority to set System Limits if an adverse effect is shown to be likely. 

 

Because there is a declared overdraft in the Seaside Basin, the District has the authority to set System Limits on water-producing facilities in that area, consistent with the Superior Court’s 2006 Final Decision (as amended).  Similarly, the District Board determined that system limits can be applied to diversions in the CVAA and certain tributaries designated as Sensitive Environmental Receptors in Rule 11 (see Item 12, October 16, 2006 MPWMD Board meeting).  It should be noted that the State Water Resources Control Board (SWRCB) has determined the CVAA to be fully appropriated between May 1 and December 31 of each year.  The Carmel River and its tributaries are designated as critical habitat for steelhead and the entire watershed (255 square miles) is designated as critical habitat for California red-legged frogs under the federal Endangered Species Act. 

 

An overdraft has not been declared for areas outside of the MPWRS.  To date, the monitoring data available and the analyses performed for non-MPWRS applications have indicated a lack of hydrogeologic connectivity between Neighboring Wells in some cases, while connectivity is evident in other cases at similar distances from the pumping well.  In most cases where hydrogeologic connectivity is assumed to occur, adverse impacts have not been determined to be significant within standard hydrogeologic measurement practices.  Overall, the existing hydrogeologic testing and monitoring data available are inconclusive regarding the degree of connectivity between wells outside of the CVAA and wells within the CVAA.   The District plans to continue its hydrogeologic monitoring program to assess if any adverse changes are occurring.  In fact, a cornerstone of all proposed WDS Permits or Confirmation of Exemptions is the ability for District staff to monitor well production and water levels. 

 

Monterey County Efforts:  According to Monterey County documents, the Monterey County Codes need to be updated to implement policies adopted in the 2010 General Plan for the non-coastal unincorporated areas of the County. Existing County well regulations need clarification and updating to address on-going policy matters, update language to reflect changes in State regulations (State Bulletins), and resolve some recurring problems.  The County Board of Supervisors will be considering changes to County well regulations in the coming months.

 

In recent months, District staff has been coordinating with Monterey County agencies regarding their well-related activities.  Registered hydrogeologists at the Monterey County Water Resources Agency (MCWRA), working as consultants to the Monterey County Environmental Health Bureau (MCEHB), currently perform calculations on the potential of a well to adversely affect nearby wells and in-stream flow of specified rivers and creeks that sustain steelhead, including those in Carmel Valley.  This evaluation is performed as part of the process to approve a MCEHB Well Construction Permit in compliance with Monterey County General Plan Policy 3.3.  Monterey County is also revising its Well Ordinance and has met with stakeholder groups and other agencies, including MPWMD.  On October 22, 2013, the Monterey County Board of Supervisors considered various well Ordinance concepts, and provided direction to its agency staff.  The MPWMD General Manager wrote a letter to the Supervisors encouraging coordination between the County and MPWMD on well regulations, especially for specific areas within the District such as the CVAA and Seaside Groundwater Basin. 

 

The County calculates impacts to in-stream flow or neighboring wells before a Well Construction Permit is issued.  The MCEHB issues a “Source Water Quality and Quantity Analysis Certification Form” based on well testing that indicates the flow in gallons per minute (gpm) that the well is expected to reliably produce along with water quality data.  Both the County and MPWMD require a 72-hour test at a minimum pumping rate of 3 gpm, and the amount and type of data collected during the test are similar.  Current MPWMD Rules require more detailed analysis of the data.  MPWMD staff issues a memorandum quantifying the reliable supply and whether there are impacts to Sensitive Environmental Receptors or Neighboring Wells (note that this requirement was suspended by MPWMD Resolution 2013-12 for one year for certain single parcels outside the influence of the MPWRS).

 

DISCUSSION:  The following paragraphs first review the current regulatory setting and then describe the changes recommended by staff. 

 

Current Regulations:  The MPWMD Rules & Regulations currently require a WDS Permit for all wells within the District except for a few exemptions defined in Rule 20-A and 20-C.  Examples of exemptions include: wells older than March 1980; replace/refurbish/reactivate a well; and certain single-parcel situations outside of the California American Water (CAW) service area.  MPWMD Rule 21 identifies the required application information to be submitted and is linked to Implementation Guidelines found on the District website.  In May 2012, Ordinance No. 150 added additional notification and monitoring requirements for Neighboring Wells.  Some of these requirements were superseded by Resolution 2013-12, which suspended certain requirements for single non-MPWRS parcels served by onsite wells. 

 

Applicants start with a MPWMD Pre-Application Form, which must include the MCEHB Well Construction Permit and other information in order to be accepted.  After the well testing and analysis are completed, a full WDS Permit Application package may be submitted. Rule 21 describes required components of an application.

 

Rule 22 identifies: (a) the protocol for the four different levels of WDS Permits; (b) required Findings; (c) minimum standards of approval; and (d) mandatory conditions of approval, which include setting System Limits and at least 15 other requirements.  Except for those situations covered by Resolution 2013-12, applicants must define the quantity of water to be produced in acre-feet per year (AFY), and submit a hydrogeologic report that demonstrates that this quantity can be reliably produced by the WDS without harming Sensitive Environmental Receptors and/or Neighboring Wells, as defined by Rule 11. 

 

The applicant’s hydrogeologic report is reviewed by District technical staff and consultants, who confirm in writing whether they concur with the report conclusions.  Based on this evidence, the District Project Manager (with review by the District Engineer) prepares a WDS Permit package that includes a Staff Determination, hydrogeologic review memorandum, Findings and Conditions of Approval pursuant to Rule 22, CEQA documentation, invoice documentation for final fees (or refund), Acceptance Form, Indemnification Agreement and Deed Restriction that attaches the WDS Permit and related enclosures for the County Recorder.  The latter three documents are signed and notarized by the applicant.  District Counsel reviews the documents for legal accuracy (ownership, deed restriction language, etc).  The General Manager signs the final WDS Permit.

 

An Exemption Request is included as an option in the Pre-Application Form.  Staff determines whether the exemption criteria in Rule 20-C are met and prepares an abbreviated document that provides the rationale/evidence for the exemption and sets certain conditions of approval.  Currently, Rule 20-A directs staff to set baseline System Limits for “previously existing systems” according to the protocol defined in Rule 40.  The Confirmation of Exemption document is signed and notarized by the applicant, and recorded.

 

New Regulatory Concepts Recommended by Staff:  The staff recommendation is to expand the situations that qualify for an exemption, and (with a few exceptions) reserve the setting of System Limits and the current full WDS Permit process to facilities within the MPWRS (CVAA and Seaside Basin) or facilities within 1,000 feet of the MPWRS or a Sensitive Environmental Receptor that could cause a negative impact.   Staff would rely on assessments performed by Monterey County for non-MPWRS situations to determine adequacy of flow and potential impacts to Neighboring Wells or SERs.  This would reduce the MPWMD staff workload and create a more streamlined process for most applicants.  Notably, non-MPWRS wells on less than four Parcels comprise about 90% of the WDS Permit applications.  Counsel also recommended revising the definition of a Single-Parcel Connection System to a well or wells on one legal parcel that serves only that legal parcel.

 

Staff proposes to delete the Pre-Application phase, which would save applicants from a $665 charge, and have maps and necessary guidance information clearly delineated on the District’s website.  Staff would still be available to answer questions via phone or e-mail.

 

Staff also recommends discontinuing most of the MPWMD reviews of hydrogeologic tests that duplicate Monterey County well impact assessments in the non-MPWRS situations.  MCWRA hydrogeologists currently assess whether there would be an impact to in-stream flows or nearby wells before the Well Construction Permit is issued by MCEHB.  MCEHB staff confirms whether there is adequate water quality and quantity after reviewing the 72-hour well testing results.  Assuming that the future revised Monterey County Well Ordinance includes coordination with MPWMD regarding mutually agreeable thresholds and buffer distances for impacts to streams and wells within the District (especially in Carmel Valley), County analyses for the non-MPWRS situations should satisfy MPWMD interests.  If there is a concern about potential impacts or reliability of supply, the District has the option of requiring further evaluation or analysis for good cause, especially for wells near the CVAA.

 

Exhibit 20-C provides a “road map” for the recommended conceptual changes to the WDS Regulations.  Specific numerical values are still being developed for certain criteria, and will be included in future ordinance text.  The roadmap is based on a series of questions, which lead the reader to matrix tables. Based on the situation, the level of regulation is identified in the matrix.  Questions include:

 

·         Is the proposed WDS based on a well or not? 

·         Is the well located within or outside the MPWRS (CVAA or Seaside Basin)? 

·         Is the well located within 1,000 feet (or other distance to be determined) of the MPWRS or a SER?

·         How many parcels are served by the well(s)?

 

Based on the answers, the application would follow one of four pathways:

 

1.      Type A Exemption (basic, standard text);

2.      Type B Exemption (additional analysis may be required; possible restrictions);

3.      Type C WDS Permit (multi-Parcel, no System Limits); and

4.   Type D WDS Permit (full analysis and includes System Limits).

 

Type A and B would be used for situations that have a lower probability of adverse effect due to location, fewer parcels served, production below a threshold, or other factors such as correlative water rights.  Hydrogeologic analysis above and beyond that already performed for the MCEHB would not be required. Type C would be for situations where a WDS Permit may be required (due to four or more parcels being served) but does not include System Limits.  Type D would be very similar to current requirements and applies to sensitive areas (such as the CVAA or Seaside Basin) or larger non-well projects.

 

Removing the requirement to set System Limits for non-MPWRS well owners with correlative water rights will result in fewer notifications of owners of Neighboring Wells as currently embodied in Ordinance No. 150, which was passed in 2012 to increase awareness of new well construction.  Many of the Ordinance No. 150 requirements would not apply to most of the non-MPWRS situations.  However, the County has increased its review of impact to nearby wells before a MCEHB Well Construction Permit is issued, so there is greater protection sooner in the process.

 

Importantly, all regulatory paths include the requirement for the applicant to enable the District to physically monitor the wells or other facilities as needed.  This is in addition to current requirements to register, meter, and annually report production each water year. 

 

The Rules & Regulations Review Committee discussed the level of involvement of the Board for the various regulatory paths.  They concurred that the General Manager (or his designee) should administratively handle all applications except more complex, unique or large projects in sensitive areas; past examples include September Ranch, Monterey Bay Shores or Ocean View Plaza.  Staff would continue to post its decisions on the District website under “Appealable Decisions.”  The applicant or any other party may appeal the staff decision to the Board pursuant to MPWMD Rule 70. 

 

After the Rules & Regulations Review Committee meeting, staff determined that a few non-MPWRS applications not covered by Resolution 2013-12 are in-progress and could be ready for a WDS Permit decision before a new ordinance is adopted and the MPWMD Rules are changed.  Thus, staff recommends enabling the General Manager with the discretion to waive setting System Limits for qualified WDS applications that are ready for permit issuance.  Staff is aware of only one application that is nearing completion at this time, but others are expected in the next few months with the end of the 2013 well testing season on October 31, 2013.

 

IMPACT TO DISTRICT RESOURCES:  In the near-term, a comprehensive revision to the MPWMD Rules & Regulations governing WDS, and the associated CEQA review and public hearings, will require staff in the Water Resources and Planning & Engineering Divisions as well as review by District Counsel and the General Manager.  Additional staff time will be needed to revise the Implementation Guidelines and develop new permit fees that best match the anticipated staff, consultant, legal and direct costs.  However, in the long-term, this effort will reduce the staff workload, reduce costs for applicants, avoid duplication with Monterey County and be consistent with the District’s authority over Monterey Peninsula water resources.  MPWRS-related applications will still receive full review under the Rules and Regulations; however, non-MPWRS submittals will be processed without assessing hydrogeologic testing results or reviewing historical water use that would be needed to determine production limits.  Time coordinating monitoring of Neighboring Wells (Ordinance No. 150) also would be significantly reduced for non-MPWRS wells.

 

EXHIBITS

20-A    Current Table 22-A from MPWMD Rule 22

20-B    Overview table of staff’s proposed regulatory concept

20-C    Regulatory concept tables for different WDS situations

 

U:\staff\Boardpacket\2013\20131118\ActionItems\20\item20.docx


[1] The Monterey Peninsula Water Resource System (MPWRS) means the surface water in the Carmel River and

its tributaries, Groundwater in the Carmel Valley Alluvial Aquifer which underlies the Carmel River, and Groundwater in the Seaside Groundwater Basin.

[2] A “Sensitive Environmental Receptor (SER)” is any one of the following areas or locations: (1) the Carmel Valley

Alluvial Aquifer (alluvium); (2) the five tributaries listed in MPWMD Rule 20, including Tularcitos, Hitchcock Canyon, Garzas, Robinson Canyon and Potrero Creeks; (3) the Seaside Groundwater Basin; (4) the Pacific Ocean as delineated by the mean high tide line; or (5) other sensitive locations as designated by Resolution of the MPWMD Board of Directors.