ITEM:		PUBLIC HEARING
18.	CONSIDER ADOPTION OF JULY THROUGH SEPTEMBER 2014 QUARTERLY WATER SUPPLY STRATEGY AND BUDGET
Meeting Date:			June 23, 2014	Budgeted:	N/A
From:			David J. Stoldt,	Program/	N/A
			General Manager	Line Item No.:
Prepared By:			Kevan Urquhart &	Cost Estimate:	N/A
			Jonathan Lear
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 July through September 2014 Quarterly Water Supply Strategy and Budget for California American Water’s (Cal-Am) Main and Laguna Seca Subarea Water Distribution Systems (WDS). The proposed budgets, which are included as Exhibit 18-A and 18-B, show monthly production by source of supply that is required to meet projected customer demand in CalAm’s Main and Laguna Seca Subarea systems, i.e., Ryan Ranch, Bishop, and Hidden Hills, during the April through June 2014 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 18-A shows the anticipated production by Cal-Am’s Main system for each production source and the actual production values for the Water Year (WY) 2014 to date through the end of May 2014. The anticipated production values assume that Cal-Am’s annual main system production for customer service will not exceed 12,735 acre-feet (AF), including 2,669 AF from Cal-Am’s wells in the Coastal Subareas of the Seaside Groundwater Basin, 300 AF from Sand City Desalination Plant, 0 AF recovered from Water Project 1 and 2 (formerly Phase 1 & 2 ASR), and 9,766 AF from the Carmel River Basin. The total from the Carmel River Basin is consistent with State Water Resources Control Board (SWRCB) Order No. 95-10 and 2009-0060. The total from the Seaside Groundwater Basin is consistent with the Seaside Basin Adjudication Decision. For the purpose of this budget, it is conservatively assumed that Critically Dry inflow conditions will occur for the rest of WY 2014.

Exhibit 18-B shows the anticipated production by Cal-Am’s Laguna Seca Subarea system for each production source and the actual production values for WY 2014 to date through the end of May 2014. Please note that the budgeted production values assume that Cal-Am’s annual production for WY 2014 will not exceed 147 AF from the Laguna Seca Subarea of the Seaside Groundwater Basin, whereas actual demand will exceed that amount. This total is consistent with the Seaside Basin adjudication decision.

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 18-C, Quarterly Water Supply Strategy Report: July – September 2014

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 July, August, and September 2014. Staff from the District and Cal-Am met to cooperatively review, refine and approve this strategy on June 10, 2014. California Department of Fish and Wildlife (CDFW), United States Fish and Wildlife Service (USFWS), and and the National Marine Fisheries Service (NMFS) staff were unable to attend, but have been informed of the outcome. Staff from the State Water Resources Control Board’s, Division of Water Rights were invited to attend the meeting by conference call. Based on current reservoir and Carmel Alluvial Aquifer storage conditions, river flows in October 2013 through May 2014, it was agreed that “Critically Dry” 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 try to avoid producing any groundwater from its wells in the Upper Carmel Valley during July through September 2014, and will focus instead on producing approximately 1,243, 1,100, and 1,513 AF of groundwater from its wells in the Lower Carmel Valley during July, August, and September 2014, respectively.

It was also agreed that, subject to rainfall and runoff conditions in the Carmel River Basin, Cal-Am would produce 250, 400, and 0 AF of water each month in July, August, and September 2014, respectively, from the Coastal Subareas of the Seaside Basin, in addition to 25 AF per month from the Sand City Desalination Plant during this period. It was also agreed that Cal-Am would budget to produce 18, 17, and 16 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

18-A Quarterly Water Supply Strategy and Budget for CAW Main System: July - September 2014

18-B Quarterly Water Supply Strategy and Budget for CAW Laguna Seca Subarea: July - September 2014

18-C Quarterly Water Supply Strategy and Budget Report: July - September 2014

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