ITEM:		PUBLIC HEARING
16.	CONSIDER SECOND READING AND ADOPTION OF ORDINANCE NO. 160 – COMPREHENSIVE CHANGES TO MPWMD RULES AND REGULATIONS FOR WATER DISTRIBUTION SYSTEM PERMITS AND ADOPT REVISED FEE DEPOSIT SCHEDULE
Meeting Date:			April 21, 2014	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: Concurs with staff’s recommendation.
Committee Recommendation: N/A for second reading.
CEQA Compliance: Not a CEQA “project.”

SUMMARY: The Board will consider the second reading and adoption of MPWMD Ordinance No. 160 (Exhibit 16-A) to amend several rules governing Water Distribution System (WDS) and Mobile WDS Permits (Rules 11, 20, 21, 22, and 173). The ordinance also changes Rule 22, Table 22-A, which will provide guidance for the General Manager to determine the permit review level (Exhibit 16-B). The Board will also consider adopting Resolution 2014-XX that revises the fee deposit schedule (Exhibit 16-C, including Attachment 1) that was recommended in the Draft Implementation Guidelines approved by the Board at the first reading of the ordinance on March 17, 2014.

Ordinance No. 160 streamlines the WDS permit process, reduces duplication between MPWMD and Monterey County for permitting certain types of wells, and brings the District’s Rules into conformance with generally accepted legal theories concerning rights to percolating groundwater. While Ordinance 160 will reduce the regulatory burden and reduce permitting costs for certain situations, no rule changes are proposed for water systems located in, or those which could have an impact on, the Monterey Peninsula Water Resource System (MPWRS), which is defined in Rule 11 as “...the surface water in the Carmel River and its tributaries, Groundwater in the Carmel Valley Alluvial Aquifer (CVAA) which underlies the Carmel River, and Groundwater in the Seaside Groundwater Basin”.

The Board unanimously approved the first reading of Ordinance No. 160 at its March 17, 2014 meeting. The second reading version contains minor corrections and clarifications, which are described in the “Discussion” section below. If the Board approves the second reading of Ordinance 160, it would go into effect on May 21, 2014. The Board also previously approved Draft Implementation Guidelines, which provide information for staff and the public about how applications will be processed. Staff will finalize the Draft Implementation Guidelines prior to the effective date of the Ordinance 160. The District website will also be updated to include the new information.

The Draft Implementation Guidelines include recommended fee deposits for different permit pathways that reflect revised estimates of the time required for staff and legal review to process permits. In some areas of the District, some of the notification, monitoring and impact analysis requirements associated with new water distribution systems will no longer be required or can be satisfied with documentation from Monterey County. Thus, permit fee deposits for certain categories of permit review can be reduced. Actual permit fees reflect the cost of processing permits and can be more or less than the fee deposit shown. Staff recommends that the Board adopt Resolution No. 2014-XX (Exhibit 16-C), which authorizes the revised WDS Permit fee deposit schedule shown as Attachment 1 of Exhibit 16-C. This fee deposit schedule would become effective at the same time as Ordinance 160. Staff plans to present a comprehensive revision of the District’s overall fee schedule shown in Rule 60 to the Board for consideration at its June 16, 2014 meeting. At that time, staff will recommend updating the District’s Fee and Charges table to reflect the fee categories for WDS Permit processing shown in Exhibit 16-C.

At its March 17, 2014 meeting, the Board determined that Ordinance No. 160 “does not have the potential to result in either a direct or reasonably foreseeable indirect physical effect in the environment” and so is not considered a “project” under the California Environmental Quality Act (CEQA) Guidelines, Section 15378. The function of the ordinance and its associated Implementation Guidelines is to clarify permit processing protocol. In contrast, each future application received will be subject to CEQA review in order to determine whether the proposed project is exempt under CEQA or will require environmental review in compliance with the applicable CEQA sections.

RECOMMENDATION: District staff recommends that the Board:

· Approve the second reading and adopt Ordinance No. 160, shown as Exhibit 16-A, including revised Rule 22, Table 22-A as shown in Exhibit 16-B.

· Direct staff to finalize the Draft Implementation Guidelines prior to the effective date of the Ordinance, which is May 21, 2014.

· Adopt Resolution 2014-XX, Exhibit 16-C, which approves a revised fee schedule, shown as Attachment 1 to Exhibit 16-C, which would go into effect on May 21, 2014.

DISCUSSION: MPWMD Rules 20, 21 and 22 describe the WDS Permit process. Ordinance No. 160 would amend, refine or clarify the following rules:

· Rule 11, Definitions

· Rule 20-A, Permits Required

· Rule 20-C, Exemptions

· Rule 21-A, Application

· Rule 22-A, Process on Application

· Rule 22-B, Required Findings

· Rule 22-C, Minimum Standards for Granting Permit

· Rule 22-D, Mandatory Conditions of Approval

· Rule 22-E, Permit Amendments

· Table 22-A, Permit Review Matrix

· Rule 173, Mobile WDS.

A WDS application will be processed based on the water system’s location, water production and other factors, as explained in the Implementation Guidelines, a draft of which was presented in the March 17, 2014 meeting packet and can be viewed on the District’s website. Based on a determination by the General Manager of the permit process level, a WDS application would follow one of four pathways:

· Confirmation of Exemption

· Level 1 WDS Permit (Basic Non-MPWRS; no System Limits)

· Level 2 WDS Permit (Seaside Groundwater Basin, subject to adjudication decision)

· Level 3 WDS Permit (Project-Specific MPWRS/Other with System Limits).

The level of review for Mobile WDS depends on the water source location and number of parcels served. Mobile WDS may not be used for long-term potable (drinking water) supply and are allowed for drinking water only in a health-related emergency.

Additional background information is provided in the March 17, 2014 agenda package (Item 13), which is available on the District website.

Changes to Second Reading Version of Ordinance No. 160

No substantive changes were made to the first reading version of Ordinance No. 160; however, staff made several minor grammatical and typographic corrections, which are not described herein. In addition, the following three changes are noted for improved clarity:

· Clarify Rule 11 definition of Level 3 WDS Permit

· Clarify Rule 21-A-5 text describing Monterey County’s role in well assessments

· Properly label Table 22-A (at end of ordinance) and make corrections

New text for the second reading version is provided as bold italic in the paragraphs below.

FOR RULE 11, DEFINITIONS: Text is added to accurately reflect Rules 20, 21 and 22:

LEVEL 3 WDS PERMIT (PROJECT-SPECIFIC LIMITS IN MPWRS/OTHER) – “Level 3 WDS Permit (Project-Specific Limits in MPWRS/Other)” shall mean a discretionary Permit for a Water Distribution System or Mobile Water Distribution System located within the Monterey Peninsula Water Resource System, or a system located outside of the Monterey Peninsula Water Resource System that does not meet the exemption criteria in Rule 20, and does not meet the criteria for a Level 1 or Level 2 Permit in Rules 21, 22 and 173, and the associated Implementation Guidelines specified in those rules. The Level 3 Permit is issued with System Limits as a condition of approval, and other restrictions as necessary to protect the MPWRS. Examples include: any water system that extracts water from the Carmel Valley Alluvial Aquifer; a multiple-Parcel system in the Seaside Groundwater Basin that produces more than 5.0 Acre-Feet per year that is not specified in the Adjudication Decision; and major water supply projects such as a dam, desalination plant or reclamation facility that require an Environmental Impact Report.

FOR RULE 21-A-5, REQUIRED SUBMITTALS IN AN APPLICATION: The words “if applicable” are added because the referenced Monterey County agencies do not perform assessments or provide a certification form for certain situations such as irrigation-only wells. Thus, an applicant could not submit this documentation.

5. A copy of: (a) an approved Water Well Construction Permit issued by the Monterey County Environmental Health Bureau, including the associated impact assessment conducted by the Monterey County Water Resources Agency (if applicable); (b) the State of California Well Completion Report submitted to the California Department of Water Resources (“well log”); and (c) Monterey County Environmental Health Bureau “Source Water Quality and Quantity Analysis Certification Form” or similar approval document from that agency (if applicable); and …….

FOR TABLE 22-A (Exhibit 16-B): The first reading version did not properly label the table as “Table 22-A,” which would replace the current table at the end of Rule 22. Also, the second row designated as “<4” parcels in the far right column is corrected to show that a water system in the Seaside Groundwater Basin with production less than 5.0 acre-feet per year and that serves 2 or 3 parcels would be a Level 2 Permit; an Exemption can be granted only for a single-parcel system. The table is a simplified matrix and the Implementation Guidelines provide more detail on the possible Seaside Basin permit processing levels.

EXHIBITS

16-A Ordinance No. 160, second reading version

16-B Table 22-A for Rule 22, second reading version

16-C Resolution No. 2014-XX, including Attachment 1, “Proposed Fee Schedule”

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