WATER SUPPLY PLANNING COMMITTEE
PRESENTATION
4.	REVIEW OF CEASE AND DESIST ORDER MILESTONES
Meeting Date:		July 6, 2020	Budgeted:	N/A
From:		David J. Stoldt	Program/
		General Manager	Line Item No.:	N/A
Prepared By:		David J. Stoldt	Cost Estimate:	N/A
General Counsel Approval: N/A
Committee Recommendation:
CEQA Compliance: This action does not constitute a project as defined by the California Environmental Quality Act Guidelines Section 15378.

SUMMARY: On April 29, 2020 California American Water (Cal-Am) filed with the State Water Resources Control Board its 2nd Quarterly Report for the 2019-2020 Water Year Addressing Operations for the Period of January 1, 2020 to March 31, 2020. Such a report is required under the extended Cease and Desist Order (CDO). That compliance filing included the following passages (emphasis added):

· “Milestone 5, Water Year 2019-2020 ((1) Drilling activity for at least one MPWSP Desalination Plant source water production well complete; (2) foundation and structural framing complete for MPWSP Desalination Plant pretreatment seawater reverse osmosis, and administration buildings at desalination plant; (3) excavation complete for MPWSP Desalination Plant brine and backwash storage basins; and (4) 25% of Desalination Plant transmission pipelines installed based on total length, including 100% installation of the "Monterey Pipeline and other ASR related improvements".)

· The stay on physical construction of the desalination plant imposed by the Monterey Superior Court currently remains in place until at least April 21, 2020. Although Cal-Am had been on track to complete permitting and begin construction activities at the site, the court's stay precludes Cal-Am from starting the necessary activities at the plant site in order to be able to complete construction of the various plant facilities required under Milestone 5 by September 30, 2020. It is therefore unlikely that Cal-Am will be able to complete all of the activities required under Milestone 5 by September 30, 2020. This setback resulting from the court's stay is beyond Cal-Am's control.

· The Coastal Commission has not set a date for the continued hearing and determination on Cal-Am's application for a coastal development permit for the project's slant wells. Without a permit, Cal-Am cannot begin the necessary activities in order to complete drilling activities for a slant well, as required under Milestone 5. The delay caused by the Coastal Commission's decision to continue the hearing, based on a determination made just 10 days before the scheduled hearing that additional investigation was required, is beyond Cal-Am's control.”

This highlights a need to revisit what the CDO milestones dictate going forward. Attached as Exhibit 4-A are the milestones as incorporated in WR 2016-0016, Section 3.b.v and vi.

EXHIBIT

4-A Milestones Under the CDO

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