ITEM:		CONSENT CALENDAR
4.	CONSIDER DISTRIBUTION OF FUNDS FOR LOCAL PROJECT GRANT FUNDING
Meeting Date:			October 17, 2022	Budgeted:	FY 22-23
From:			David J. Stoldt, General Manager	Program/	Protect Environmental Quality
				Line Item:	Project 2-6-1
Prepared By:			Maureen Hamilton	Cost Estimate:	Not-to-Exceed $25,000
General Counsel Review: N/A
Committee Recommendation: The Water Supply Planning committee reviewed this item on October 3, 2022 and recommended approval.
CEQA Compliance: This action does not constitute a project as defined by the California Environmental Quality Act Guidelines Section 15378.

SUMMARY: The City of Monterey (City) has proposed to perform development work for the Olivier Street Stormwater Diversion Project (Project), also referred to as Lighthouse Tunnel Diversion Project and Monterey Tunnel Stormwater Diversion Project.

The Project will divert urban drainage from an existing storm drain, currently discharging untreated to the Monterey Bay National Marine Sanctuary, to an existing City sanitary sewer utility for treatment at Monterey One Water Regional Treatment Plant. This diversion would provide 10-12 acre-feet of dry weather source water for water recycling at the time of year when source water is not abundant, and reduce point source discharge in a Disadvantaged Community.

In September 2022 the Project was selected by the Integrated Regional Water Management (IRWM) Group to include in its Proposition 1 IRWM Implementation Round 2 Grant (IRWM Grant) application. The IRWM Grant application is due February 2023. Due to timing of the IRWM Grant solicitation and City budgeting process, Project development funds were not budgeted at the City this fiscal year. Because dry weather source water is important for recycled water supply, MPWMD and Monterey One Water staff have been assisting with development of this important dry-weather diversion project.

The work to be funded by this potential MPWMD grant includes clarifying existing structure and utility locations, existence of utility easements, and whether State Parks and other property owner(s) may be impacted by the proposed diversion pipe alignments. Determining the complexity of the easements in a timely manner is needed to better estimate CEQA and permit costs required for the IRWM Grant application.

Staff is requesting authorization to allocate funds to and enter into a grant agreement with the City of Monterey for Project development costs. The Project’s public purpose is increased water supply.

The 2022 budget includes a line item for local water projects which has $25,000 in unallocated funds.

RECOMMENDATION: The Board of Director’s will consider approving the following actions to include to:

1. Approve the City of Monterey grant application to MPWMD for Olivier Street Stormwater Diversion Project development costs; and

2. Authorize the General Manager to enter into a grant agreement with the City of Monterey for Olivier Street Stormwater Diversion Project development costs in the amount of $25,000.

EXHIBIT

4-A Grant Agreement Between Monterey Peninsula Water Management District and the City of Monterey for Local Water Project Development Expenses

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