ITEM: VI                    PUBLIC HEARINGS

A.        CONSIDER SECOND READING AND ADOPTION OF ORDINANCE NO. 96 -- AN ORDINANCE OF THE BOARD OF DIRECTORS OF THE MONTEREY PENINSULA WATER MANAGEMENT DISTRICT REVISING THE DEFINITION AND REGULATION OF WATER DISTRIBUTION SYSTEMS

Meeting Date: march 19, 2001
Staff Contact: Henrietta Stern
General Counsel Approval: N/A
Committee Recommendation: N/A
CEQA Compliance: Negative Declaration adopted in August 2000
  		Budgeted: No
Program/Line Item No.: N/A
Cost Estimate: Uncertain

SUMMARY:  The Board will consider the second reading and adoption of Ordinance No. 96, which revises the definition and regulation of water distribution systems within the District.   On November 20, 2000, the Board approved the first reading of the ordinance (Draft-4 version) and directed that several changes and clarifications be made, as summarized in Exhibit 1.   These changes were incorporated into a Draft-5 version in December 2000. 

Exhibit 2 provides the most current version (Draft-7, March 2001) of Ordinance No. 96, which supercedes all previous versions.  Draft-7 is very similar to Draft-6, except that it adds text to avoid "Catch-22" language about existing wells; remedy confusing language;  clarify the meaning of "expand/extend" a water distribution system; and have the ordinance be effective 30 days after adoption, consistent with all other non-urgency ordinances.  Staff believes these changes should be made, as discussed in the "Recommendations" section below.  Draft-7 text in bold italics refers to permanent changes to be made to existing MPWMD Rules and Regulations.  The red-line (shaded) text in Draft-7 reflects only the most recent changes from Draft-6.  This red-line (shaded) marker will be removed from the final text.

Staff has identified other refinements that should be considered by the Board for the Final Version of Ordinance No. 96, as discussed in Part 2 of the "Recommendations" section below.  In brief, they pose the following policy questions, which reflect how flexible the Board wishes to be:

At the February 22, 2001 meeting The Board heard the staff presentation, received public comments (both oral and written), and posed questions to staff.  Action was deferred until the March 19, 2001 meeting.  Please note that substantive questions raised by the Board and public on February 22, 2001 are addressed in the "Discussion" section below.

RECOMMENDATIONS:  Staff recommends that the Board take action in three parts: (1) approve Draft-7, which includes text staff believes should be in the ordinance; (2) provide policy guidance on additional text refinements requested by the public, and (3) provide other direction.  Text  to be included in the Final Version of Ordinance No. 96 is shown in bold italics.

Part 1 -- Consider Draft-7 Recommended by Staff

R1.      Approve Draft-7 of the ordinance, which includes corrections described in the February 22, 2001 staff note, Recommendation #1 (i.e., accurate County Code Title number, and accurate definition of projects in progress as directed by the Board on November 20, 2000).  Draft-7 also includes five changes to improve clarity, discussed on February 22, 2000, and one needed change discovered in early March 2001, as follows:

         Section Three, Rule 11, Definition of Active Well, amend the first sentence to read:

"An active well is a well that has been permitted by the Monterey County Health Department (or a well that was completed prior to year 1973) and constructed, and has produced ....."

This is a housekeeping change made to avoid a Catch-22 situation for existing, registered, active wells that have reported use to MPWMD for years, but would not be recognized because they do not have a Health Department permit for the simple reason that the well existed prior to 1973, the year the Department began issuing permits. Documentation of the well age can be based on MPWMD registration information (required for all wells since 1981), original pump tests, business receipts for a farm, local historic knowledge, old water use records, etc.

         Section Four, Rule 20-A, Permits Required, paragraph 2:  Delete the words, "...operated by a public utility" in line 3 because many entities other than public utilities own wells. Replace the words, "...on or before one day after this ordinance is adopted ..." with a date certain in lines 5-6 to clarify the deadline.  The first sentence reads:

Persons who hold a valid permit for construction and operation of a water distribution system from the Monterey County Health Department, prior to March 12, 1980, or a water distribution system in existence prior to that date operated by a public utility, shall be deemed to have been issued a permit in compliance with these Rules and regulations.

 The second full sentence begins with the words:

"Persons who hold a valid permit from the Monterey County Health Department dated on or before March 20, 2001....". 

This text assumes adoption of Ordinance No. 96 will be on March 19, 2001; the date will be changed in the final text if adoption occurs on a different date.

         Section Four, Rule 20-B, Permits to Expand/Extend a Water Distribution System:   Clarify that the term "expand/extend" refers to permits to intensify use and connection fees for individual structures within a water distribution system.  In contrast, Rule 22-E, "Amendments to Permit," refers to modification of the system as a whole, typically by increasing the total connections allowed, enlarging the annual water production limit, or expanding the service area boundary.  This change is made to help avoid confusion between two District permit processes. The first sentence adds text in bold italic:

Before any person expands/extends a water distribution system or any mobile water distribution system, such person shall obtain a written permit from the District or the District's delegated agent, as described in District Rules 23 and 24.

         Section Six, Rule 22-A-2-(b), Single-Connection Process for Subpotable Uses:   The entire first paragraph is stricken because it is old language that conflicts with current versions.  The Board has determined that any single-connection system (potable or subpotable) that is outside of the Carmel Valley alluvial aquifer and the Seaside coastal areas is exempt from regulation by Ordinance No. 96.  This outdated language provides for a hearing exemption, but not a permit exemption for subpotable systems meeting these criteria.

        Section Eleven, Effective Date: Change text to state that Ordinance No. 96 becomes effective at 12:01 a.m. on the 30th day following the date of adoption rather than the day after adoption.  Assuming adoption on March 19, 2001, the effective date will be Wednesday, April 18, 2001.  The 30-day time period is consistent with all other non-urgency ordinances.  This period is also needed for staff to develop the draft Implementation Guidelines, based on final board direction on March 19, 2001,  revise application forms, coordinate permit processing logistics, train staff, and other tasks.  The Draft Guidelines will be reviewed by the Board in April 2001.

        Global: Time period references to months have been changed to days (e.g., "six months" is now referred to as "180 days") to avoid confusion.

Part 2 -- Consider Further Text Refinements to Draft-7 for Final Text

R2.      Clarify the definition of a single-connection system in response to concerns raised by John Bridges at the November 20, 2000 meeting about the situation where a single parcel is subdivided  (see letter shown as Exhibit 3).  If the inclusion of subdivided parcels is desired, staff suggests the following change to Draft-7 text (Section Three, Rule 11, Definitions) for a single-connection system, which enables a subdivided parcel to retain its single-connection status if each new parcel is served by a separate well in a timely manner (new text is underlined):

A "single-connection system" refers to one or more buildings or structures on one individual legal parcel.  If the single parcel is subdivided into two or more separate parcels, the water distribution system is considered to be a multiple-connection system, regardless of parcel ownership, unless the newly formed legal parcels are each served by a separate well that has received a well construction permit from the Monterey County Health Department, registered, metered, inspected and approved by the District within 180 days of the date of final approval of the subdivision.

At the February 22, 2001 meeting, concerns were raised by members of the public regarding this requested change (see comment letters provided as Exhibit 4).  Some speakers believed the CEQA process would be subverted or that wells would be exempted from the ordinance in some way. One speaker suggested that the 180-day deadline be tied to the date of adoption of Ordinance No. 96 rather than the date of approval of the subdivision.  In that case, only subdivisions that could approved and drill wells before October 15, 2001 would be covered.  

As explained in the "Discussion" section below, staff does not believe lax regulation would occur due to this language change.  The County (or other lead agency) would still be required to comply with CEQA for the proposed subdivision, regardless of how the water is distributed via one well or numerous wells.  All MPWMD rules for single-connection systems would apply for each separate well on each new lot, including the requirement to demonstrate water rights.  The primary differences would be that less stringent water quality tests are required for single-connection systems (test for inorganics only rather than full Title 22 components), and the hearing officer would be the General Manager (or designee) rather than the full Board. 

 

R3.      Consider additional changes regarding projects in progress in response to concerns raised by members of the public in phone conversations to staff in December 2000 and January 2001 as well as comments by  John Bridges at the November 20, 2000 meeting (see letter shown as Exhibit 3).  Concern was raised about existing backlogs at the Monterey County Health Department preventing applicants from receiving well construction permits in a timely manner as well as possible MPWMD backlogs in inspecting and approving meters on the wells.  If the Board wishes to add additional flexibility regarding the timing of the Health Department permit, staff suggests the following change to Draft-7 text (new text compared to Recommendation #1 is underlined): 

Section Four, Rule 20-A, Permits Required, second paragraph, would read:

Persons who hold a valid permit for construction and operation of a water distribution system from the Monterey County Health Department, prior to March 12, 1980, or a water distribution system in existence prior to that date operated by a public utility, shall be deemed to have been issued a permit in compliance with these Rules and regulations.  Persons who filed a completed application to the Monterey County Health Department, date-stamped by the Department on or before the date of adoption of this ordinance, for construction of a well serving a single-connection water distribution system (as that term was applied by the District at the time the well construction permit was issued) shall be deemed to have been issued a permit in compliance with these Rules and Regulations provided all of the following actions are taken: (1) the person receives a valid well construction permit from the Monterey County Health Department, makes the well active, meters the well, has the well inspected by MPWMD and receives an approved MPWMD Water Meter Installation Inspection form dated on or before 180 days from the effective date of this ordinance; and (2) each water gathering facility of the system was registered with the District within 180 days from the effective date of this ordinance.

Assuming the Board adopts Ordinance No. 96 on March 19, 2001, the effective date would be Wednesday, April 18, 2001, and the deadline would be Monday, October 15, 2001.

R4.      Determine whether changes should be made to Section Four, Rule 20-C, Exemptions, first paragraph of Draft-7 describing exemption from regulation of single-connection systems unless the source of supply is within the Carmel Valley alluvial aquifer, "...from wells within 1,000 feet of that aquifer, or within 1,000 feet of any watercourse tributary to the Carmel River..."

One change was recommended by the Carmel Valley Property Owners Association (CVPOA) (Exhibit 5) because the existing language is too broad and imprecise.  Exhibit 6 is a small-scale map that indicates the area within which single-connection systems would be regulated in Carmel Valley, if CVPOA's recommendation were adopted.  Exhibit 7 provides examples of specific locations in Carmel Valley that would be included within a 1,000-foot boundary.  If the CVPOA refinement is desired, the final text should specify the tributaries, refer to a map, and read (new text is underlined):

"An MPWMD permit is not required for a single-connection water distribution system unless that system derives its source of supply from the Carmel Valley alluvial aquifer; from wells within 1,000 feet of that aquifer,  or within 1,000 feet of Tularcitos, Hitchcock Canyon, Garzas, Robinson Canyon or Potrero Creeks, up to the limits of the Monterey Peninsula Water Resources System, as shown in the map provided in the Implementation Guidelines; and/or the Seaside coastal areas defined in Section Three of this ordinance."

Staff continues to have concerns regarding water law issues as well as the impact on staff resources to implement the ordinance within the 1,000-foot zone recommended by CVPOA.  Water law concerns relate to the fact that the boundaries of the Carmel Valley alluvial aquifer were set by the SWRCB in its Order 95-10.  The designation of water in the aquifer as "water flowing in a subterranean stream and subject to the jurisdiction of the SWRCB" has specific, important meaning in California water law.  Expanding the zone of certain provisions of this ordinance to areas outside the alluvial aquifer could result in added complexity and expense for both single-connection applicants and MPWMD.

 Other concerns include:

                    the need to develop and disseminate a professionally drawn map of the 1,000-foot boundary at a scale large enough for individual parcels to be identified, at an estimated cost of $2,800;

                    the increased workload associated with regulation of single-connection systems in portions of the Carmel Valley upland areas, due to the fact that upland well permit applications are far more numerous than alluvial area applications

                    impact to other staff activities such as the water supply project EIR; and

                    low benefit-to-cost ratio (i.e., relatively low impact to public trust resources from single-connection systems in the upland area does not justify significant staff time needed to process permits); see "Discussion" section below. 

For these reasons, staff recommends that the language expanding the boundary beyond the Carmel Valley alluvial aquifer be removed from the ordinance.  If the Board agrees with staff's recommendation, the Draft-7 text should be changed so that it reads as follows:

"An MPWMD permit is not required for a single-connection water distribution system unless that system derives its source of supply from the Carmel Valley alluvial aquifer and/or the Seaside coastal subareas, defined in Section Three of this ordinance."

Notably, the SWRCB-defined alluvial aquifer boundary already includes portions of at least ten tributaries to the Carmel River, including major tributaries such as Potrero, Robinson Canyon, Garzas, Hitchcock and Tularcitos Creeks.

Part 3 -- Other Recommendations

R5.      Direct staff to file a Notice of Determination regarding approval of Ordinance No. 96 and the Negative Declaration adopted in August 2000.  A Notice of Determination is filed when the agency takes formal action to approve a project.

R6.      Direct staff to amend the MPWMD Rules and Regulations to reflect changes described in the final version of Ordinance No. 96.

R7.      Direct staff to prepare Draft Implementation Guidelines for Board review in April 2001.

R8.      Provide direction to staff regarding relative priority of Ordinance No. 96 permit processing activities and other augmentation and management activities, (e.g., long-term water project EIR, Seaside Basin injection/recovery project, Seaside Basin Management Plan).  Please refer to the "Impact to Staff/Resources" section for further discussion.

BACKGROUND AND PRIOR BOARD ACTION: Public comment and/or Board action has been taken on Ordinance No. 96 at six previous public hearings since March 2000.  A proposed Negative Declaration was adopted in August 2000, based on a circulated Initial Study.  The Board approved the first reading of Ordinance No. 96 (Draft-4) at its November 20, 2000 meeting, and directed that changes be made to the text as described in Exhibit 1.  Public comment and board questions for the second reading were received on February 22, 2001, with action deferred until March 19, 2001.

DISCUSSION/ANALYSIS:  Please refer to Recommendation #1, where staff describes refinements it believes should be included in the final Ordinance No. 96 text. The following discussion focuses on policy decisions reflected in Recommendations #2, #3 and #4, and other issues, based on questions raised by the public and the Board on February 22, 2001.

Recommendation #2 B Single-Connection Status for Subdivided Parcels with Individual Wells:

At its November 20, 2000 meeting, the Board directed that single-connection status be provided for subdivided parcels if each have their own separate well (Exhibit 1, 4th row).  An additional text refinement was requested in November 2000 for new parcels, regardless of when the wells are constructed (Exhibit 3, 2nd paragraph).  Concerns were raised in February 2001 (Exhibit 4) that the requested language would circumvent CEQA and the MPWMD regulatory process.  Changing the text is a policy decision, and staff has no position.  Technically, staff does not believe the requested text change will harm the regulatory process for the following reasons:

                    Status as a single-connection system does not mean exemption from Ordinance No. 96 application and approval requirements;

                    CEQA requires the County (or other lead agency) to evaluate all environmental impacts of the proposed subdivision, whether water is produced from one well or several wells;

                    The lead agency must assess the direct, indirect and cumulative impact of total water production from the subdivision, whether water is produced from one or several wells;

                    There could be environmental advantages of several smaller wells serving a subdivision rather than one larger well (e.g., smaller cone of depression, dispersed impact);

                    Water rights must be demonstrated to the County before an application to subdivide is accepted as complete;

                    If each parcel is treated as a single-connection system, each must still demonstrate water rights as part of the approval process specified in Ordinance No. 96;

                    There are few differences between information needed for single versus multiple-connection systems; the primary differences are the degree of required water quality testing and who functions as the hearing officer (staff rather than the Board).

 

Recommendation #3 B Trigger for Projects in Progress:

The primary difference between the existing text and the requested text is how far along the Monterey County Health Department well construction permit process an applicant must be by March 19, 2000, the assumed date of adoption of Ordinance No. 96.  As written, the ordinance requires that a well construction permit be issued by the County by March 19, 2001; as requested, the text would require a well construction application to be accepted as complete by the County by that date.  One citizen asked that the word "complete" be dropped.  In all cases, the well must be approved by the Health Department, drilled, registered, metered, inspected and approved by MPWMD by October 15, 2001 (180 days after the effective date of Ordinance No. 96, assuming adoption on March 19, 2001).  Changing the text is a policy decision that will affect a small number of applicants who are awaiting a County well permit, and staff has no position.  The changed text was requested to address situations where well construction permits were submitted in previous months, but no action has been taken by the County due to backlogs and other factors.

Recommendation #4 B Extent of Regulation in Carmel Valley for Single-Systems:

At its November 20, 2000 meeting, the Board discussed whether the geographic extent of regulation for single-connection systems should include the entire Carmel Valley watershed within District boundaries.  The Board directed that single-connection systems in Carmel Valley should be regulated within 1,000 feet of the alluvial aquifer or a watercourse tributary to the Carmel River (Exhibit 1, 6th row).  This determination balanced the desire for comprehensive regulation in light of water production trends, County well permit volume and distribution, data indicating that a measurable hydrologic effect of upland production on the Carmel River would be difficult to demonstrate, as well as staff workload considerations.  Information on these subjects was detailed in the October 26 and November 20, 2000 board packets.

As noted previously, the CVPOA letter (Exhibit 5) suggests limiting the water courses to five major tributaries.  CVPOA commented on February 22, 2001 that if workload were a problem, the 1,000 feet from the alluvial aquifer boundary should still remain.  Notably, the SWRCB-defined alluvial aquifer boundary already includes portions of at least ten tributaries to the Carmel River, including portions of CVPOA-suggested tributaries such as Potrero, Robinson Canyon, Garzas, Hitchcock and Tularcitos Creeks.

In February 2001, questions were posed and data requested regarding the distribution of previous well permits within the 1,000-foot boundary and outside of it.  Definitive information is not available because the District database tracks County well permits only for the "alluvial" and  "upland" categories in Carmel Valley).  An accurate estimate of future permit volume is difficult to assess.   Exhibit 7 provides a rough indication of the dozens of potential permit applicants based on the number of lots that exist within the 1,000-foot boundary.  Notably, most lots within the 1,000-foot boundary already have Cal-Am water service, and many have already drilled wells for gardens, livestock etc.  With a long County waiting list for Cal-Am water, District staff have received more calls from property owners asking whether they can drill a well to serve part of remodel project to make up for the lack of Cal-Am water.  Conceptually, any existing lot within the 1,000-foot boundary could represent a permit request under Ordinance No. 96.  It is unknown how many will actually be received.  Ironically, the lengthy review process for Ordinance No. 96 has already stimulated a rush for County well permits in Carmel Valley, so future permit volume may be lower than volume in year 2000.  As noted above in the ARecommendation #4" section above, and the "Impact on Staff/Resources" section below, staff has concerns about the impact of Ordinance No. 96 on workload, impact on other projects, and quality of service to the public.

Two speakers in February 2001 suggested mapping of recent well permits approved by the County.  Because the District lacks a Geographic Information System (GIS), and well information is provided based on the Assessor's Parcel Number, hand mapping would be very time-consuming. Even with a new GIS system, the existing well location data must still be entered, and Global Position System (GPS) data do not exist for nearly all existing wells.  Due to other workload priorities, the General Manager determined that the requested mapping cannot be accomplished at this time.  Staff concurs that an integrated GIS-based mapping system is very desirable, and  will be requesting funding for GIS software and training in future budget cycles.

Other Topics:

One speaker suggested that critical habitat for California red-legged frog should be covered by the ordinance.  The frog issue is being addressed by several Endangered Species Act efforts in progress, such as the District's Regional General 404 permit and the joint Habitat Conservation

Plan by larger Carmel Valley water pumpers.  It is possible that the Carmel River Watershed Council may also address this issue in the future as part of a watershed management plan.

One speaker requested that certain language about approval of a permit be changed from a "negative" to a "positive" tone.  The Draft-7 language reflects Board-directed changes from earlier versions of the ordinance, in response to complaints by previous speakers in Fall 2000 that the original wording was too "negative."  It appears that "negative" and "positive" is in the eye of the beholder.

Regarding single-connection systems, one speaker asked for an explanation of the language, "...as that term was applied by the District at the time the well construction permit was issued..." for Rule 20-A, 2nd paragraph.  The Board directed on November 20, 2000 that this language be added to protect a limited class of existing projects from being regulated retroactively.

Regarding replacement of a well, one speaker asked about consistency with County ordinances regarding the distance from the river in which special permits are required.  The County uses 200 feet as a zone of regulation in the floodway fringe; the District uses 25 feet for all of its riparian corridor-related ordinances.

Director Erickson asked whether certain text on page 158 and 159 of the February 22, 2001 packet addressed only potable supply.  Both subpotable and potable supply are regulated by Ordinance No. 96, except subpotable supply sources have less stringent water quality and quantity information requirements.

Director Chesshire requested that a letter be written to the State Water Resources Control Board  asking whether landowners or other water users other than Cal-Am are subject to Order WR 95-10 regarding drilling wells for their own use.  A draft letter is shown in Item V-C. Previous letters from the SWRCB and California water law indicate that properties drawing water within the jurisdiction of the SWRCB must receive a permit from that agency.  In Carmel Valley, this would apply to properties within the Carmel Valley alluvial aquifer that do not have established riparian or pre-1914 appropriative rights.  

One speaker asked for clarification of what Ordinance No. 96 actually does. Existing MPWMD Rules and Regulations define and govern water distribution systems (two or more connections with different owners).  Ordinance No. 96 would change existing rules in the following ways:

                    expands the scope of the District's regulation to include all water distribution systems, including mobile systems;

                    expands the definition of a water distribution system to include single-connection systems;

                    applies to systems which derive a source of supply from alternative sources such as imported water, reclamation or desalination plants;

                    refers to Implementation Guidelines for an orderly and consistent permit process;

                    expands definition of terms for increased clarity;

                    specifies exemptions to the ordinance;

                    expands information that must be provided by permit applicants, including water rights;

                    sets additional minimum standards for approval, expands required findings, and expands conditions of approval;

                    staff functions as the hearing officer for single-connection systems;

                    distinguishes between permits for "expand/extend" and "amend" a system;

                    changes regulations that govern mobile water distribution systems;

                    increases fee structure;

                    makes "housekeeping" changes to be consistent with other ordinances;

                    sunsets when Cal-Am complies with SWRCB Order 95-10.

IMPACT ON STAFF/RESOURCES: As described in the August 21 and October 26, 2000 board packets, staff has concerns about the impact of Ordinance No. 96, especially if regulation of single-connection systems in portions of the Carmel Valley upland area is directed by the Board. 

Ordinance No. 96 would affect all divisions within the District.  The General Manager or designee would be the hearing officer for potentially several dozen hearings each year.   Certain staff positions (e.g., Project Manager, Water Resources Manager, Senior Hydrologist), which already are responsible for major projects, would also be primarily responsible for evaluating applications, complying with CEQA, writing hearing staff notes, and processing permits.  The water demand (permits) office will be the first contact for water distribution system applicants, which will add to their existing workload.  The administrative services division will have additional workload related to copying hearing packets, public notices and other logistical tasks.  

Based on well construction trends in previous years, regulation of wells in the Carmel Valley upland area could add another 10 to 50 applications per year, in contrast to the average of three per year that are presently processed.  It is unclear what proportion of the upland permits is represented by the 1,000-foot area outside the alluvial aquifer contemplated by the Board.

Staff is concerned that Ordinance No. 96 activities would impact responsibilities associated with the Seaside Basin full-scale injection/recovery test well, hydrogeologic update for the Laguna Seca subarea, Seaside Basin Management Plan, and long-term water supply project EIR.  Alternatively, applicants may feel their applications are not processed in a timely manner if major water augmentation and resource management tasks take priority.  Staff requests Board guidance on the relative priority of Ordinance No. 96 implementation and other tasks if time conflicts arise.

The Board may need to consider additional staff or contract workers if the application volume becomes excessive, or if ongoing programs are adversely affected.   Staff will track Ordinance No. 96 permit volume, staff effort, and impacts, and report to the Board in late 2001.

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