EXHIBIT
4-A
Ordinance
152 Citizens’ Oversight Panel
2016
Annual Report
2015-16 Topics
of Discussion
The
following areas of discussion represent four key topics the Panel has
identified of particular interest or concern during the current year.
Therefore, it
is incumbent upon the Board to examine its needs and availability of its two
primary funding sources and develop a plan for their use, including reductions
or possible sunsets of either or both.
The General
Manager and Chief Financial Officer thoroughly examined the issue and in April
the Board adopted the following recommended strategy:
Collect both
charges for at least 3 years. This would
be done for 4 key reasons: (i) the User Fee would
primarily fund programs already in Cal-Am surcharges (District conservation and
river mitigation), so there is little “new” revenue; (ii) the Monterey
Peninsula Taxpayers Association lawsuit over the Water Supply Charge remains
unresolved, hence that revenue remains at risk; (iii) there are still large
near-term expenditures required on water supply projects; and (iv) Cal-Am has a
recent history of significant revenue undercollection,
so the viability of the User Fee is at risk until the CPUC rules on a more
stable rate design, and the predictability of the User Fee revenue is better
known. After that time, begin to sunset
or reduce collections of either or both, if possible.
Have only a
single MPWMD User Fee Surcharge on Cal-Am bill, instead of a mitigation
surcharge, a conservation surcharge, and the User Fee. Remove the existing Conservation Surcharge
and Mitigation Program expenses from the Cal-Am rates as soon as practicable. Capture in MPWMD User Fee budget. Cal-Am to remain responsible for its rebate
budget until the User Fee has capacity.
Remove the
same programs from the next GRC period (2018-2020).
Calculate
solely on “Total Water Service Related Charges” line on bill, plus any
prior-year uncollected water service related surcharges, ensuring that the User
Fee is based solely on Cal-Am water and meter revenues.
The Citizens
Oversight Panel cautiously supports this plan. The panel believes progress is being made on a
permanent water supply solution for which large scale expenditure of District
funds are being made. A 3-year
“wait-and-see” period makes sense.
However, the Panel expects the District to maintain fiscal discipline
and keep its financial “house in order.”
The Panel
believes that during this period the District should (a) develop a meaningful
plan to sunset the Water Supply Charge, in whole or in part, and (b) develop a
plan to retire the Rabobank loan that was initiated to pay for the Aquifer
Storage and Recovery water supply project in a timely fashion after the
District’s User Fee was suspended by the CPUC.
Local Water
Project Funding To-Date
|
Project |
Status |
|
Pacific Grove $200,000 |
First
$100,000 spent; Anticipate
construction start this fall; Will save 88 AFY |
|
Old Del Monte Golf Course $80,000 |
Two wells
completed; Awaiting CEQA review of
pond; Expect pond construction by
February; Will save 40-50 AFY |
|
Monterey Regional Airport $30,000 |
Completed study; Identified 104 AFY of non-potable supply; Will attempt to find users in FY 2016-17 |
|
City of Monterey $85,000 |
Storm water capture study; No expenditures to date; Trying to obtain state grant moneys |
|
City of Seaside $106,900 |
Laguna Grande non-potable well;
No expenditures to date |
|
Monterey County Fairgrounds $75,000 |
Replumb bathrooms to well
water; No expenditures to date; Almost 50% reduction in water due to
retrofits; Suggest canceling grant |
Primary Panel Function
The
Ordinance 152 Citizen’s Oversight Panel (the “Panel”) is a committee formed for
the sole purpose of providing a forum for public involvement in the budgeting
and expenditure of the District’s annual Water Supply Charge. The Panel is directed to meet quarterly and
review proposed expenditure of funds for the water supply activities of the
District. The Board does not seek
consensus from the Panel, but rather input on the ongoing budgeting and
expenditure of revenues raised by the water supply charge on water supply
related activities. The Panel will
submit an annual report for consideration by the Board of Directors. This document serves as that annual
report. In the Panel’s by-laws, the
report is to be submitted at the September Board meeting, however, the initial
panel was not constituted until December 2012, meeting for the first time in
early 2013. Hence, the first year of the
Panel’s activities just closed.
Also
under its by-laws, the Panel is expected to visit District facilities – to be
scheduled by the District – to become better acquainted with water supply
projects and operations. During the past
year, the Panel visited the Aquifer Storage and Recovery site and heard a
presentation on the Pure Water Monterey Groundwater Replenishment project.
The
Panel will also, from time to time, be requested to provide community input
with respect to water supply-related activities. One key area during the past year was the
Panel’s encouragement of the creation of funding for Local Water Project, as discussed
more within this report.
Pursuant
to the Ordinance, proceeds of the water supply charge may only be used to fund
District water supply activities, including capital acquisition and operational
costs for Aquifer Storage and Recovery (ASR), Groundwater Replenishment (GWR),
and desalination purposes, as well as studies related to project(s) necessary
to ensure sufficient water is available for present beneficial water use in the
main CAW system. In addition to direct costs of the projects, proceeds of this
annual water supply charge may also be expended to ensure sufficient water is
available for present beneficial use or uses, including water supply
management, water demand management, water augmentation program expenses such
as planning for, acquiring and/or reserving augmented water supply capacity,
including engineering, hydrologic, legal, geologic, financial, and property
acquisition, and for reserves to meet the cash-flow needs of the District and
to otherwise provide for the cost to provide services for which the charge is
imposed. No more than fifteen (15%) of
proceeds collected by reason of Ordinance No. 152 shall be used to fund general
unallocated administrative overhead.
Panel
Composition
The
Panel meets the definition of a “legislative body” as defined by the Brown Act;
therefore, all meetings shall be noticed and open to the public in compliance
with the Brown Act.
The
Panel is comprised of 9 members who shall reside within the boundaries of the
Monterey Peninsula Water Management District.
Members of the Panel shall serve at the pleasure of the District Board.
The
Board shall appoint one member from a panel of three persons nominated by the
Monterey Peninsula Taxpayers Association, and the Board shall appoint one
member from a panel of three persons nominated by the Monterey County
Association of Realtors, and each Director shall appoint 1 member to the
Panel. Appointees must reside within
the District boundaries and may be associated with a community group, but does
not have to officially represent any community group.
a)
Each
appointee shall serve a term of two years, with terms expiring on January 1, or
on the date the appointing Director vacates office as a member of the MPWMD
Board of Directors, whichever shall occur first.
b)
A
quorum of five (5) Panel members shall be required for an official meeting to
be conducted. Action may be taken by
majority vote of those Panel members present.
c)
The
General Manager will serve as Chair to the Panel, for purposes of facilitating
meetings. District staff will provide
support to the committee as appropriate.
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