EXHIBIT 10-C

Quarterly Water Supply Strategy and Budget Report

California American Water Main Water Distribution System:

January – March 2020

1. Management Objectives

The Monterey Peninsula Water Management District (District) desires to maximize the long-term production potential and protect the environmental quality of the Carmel River and Seaside Groundwater Basins. In addition, the District desires to maximize the amount of water that can be diverted from the Carmel River Basin and injected into the Seaside Groundwater Basin while complying with the instream flow requirements recommended by the National Marine Fisheries (NMFS) to protect the Carmel River steelhead population. To protect the River, ASR water banked in the winter will be recovered in the summer months. To accomplish these goals, a water supply strategy and budget for production within California American Water’s (CalAm’s) Main and Laguna Seca Subarea water distribution systems is reviewed quarterly to determine the optimal strategy for operations, given the current hydrologic and system conditions, and legal constraints on the sources and amounts of water to be produced.

The Quarterly Water Budget Group discussed the idea of reducing the target production of 25 AF per month for the Sand City Desalination Plant. The group decided that the goal of the Quarterly Budget is to reduce the reliance on the river to the maximum extent and did not want to set a monthly target less than the maximum capacity of the plant.

2. Quarterly Water Supply Strategy: January – March 2020

On December 5, 2019 staff from the District, CalAm, State Water Resources Control Board’s Division of Water Rights (SWRCB-DWR), and the California Department of Fish and Wildlife (CDFW) met and discussed the proposed water supply strategy and related topics for upcoming quarter. National Marine Fisheries Services (NMFS) was unable to attend, but was given to opportunity to provide guidance into the process.

Carmel River Basin CalAm will operate its wells in the Lower Carmel Valley in a downstream to upstream sequence, as needed to meet customer demand. For this quarterly water budget, it was agreed that when flow triggers are met ending the Low Flow Period, CalAm will mobilize to operate the upper valley wells as a source of diversion to ASR and Table 13. Any new sources of water reduce the water available to be pumped from the river on a one to one basis consistent with SBO 2016-0016. If ASR season has not yet started, MPWMD and CalAm will cooperate to begin preparation for ASR season and when instream flow requirements are met, Carmel River water injection will begin.

Seaside Groundwater Basin CalAm will continue to produce water from the Coastal Subareas of the Seaside Basin during this period, as necessary pressurize the Seaside distribution system when ASR is operating. There is also a goal to produce 25 AF of treated brackish groundwater from the Sand City Desalination Plant in each of these three months. It is recognized that, based on recent historical use, CalAm’s production from the Laguna Seca Subarea during this period cannot be reduced to zero, as is set by CalAm’s allocation specified in the Seaside Basin Adjudication Decision. In this context, the production targets represent the maximum monthly production that should occur so that CalAm remains within its adjudicated allocation for the Laguna Seca Subarea. Under the amended Seaside Basin Decision, CalAm is allowed to use production savings in the Coastal Subareas to offset over-production in the Laguna Seca Subarea. However, the quarterly budget was developed so that CalAm would produce all native groundwater in the Coastal Subareas and Laguna Seca production would be over the Adjudication allotment.

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