EXHIBIT 1-A

DRAFT MINUTES Regular Meeting Board of Directors Monterey Peninsula Water Management District July 19, 2004
The meeting was called to order at 7:10 PM in the Monterey City Council Chambers. Board members present: Alvin Edwards, Chair – Division 1 Larry Foy, Vice Chair – Division 5 (Arrived at 7:30 PM) Judi Lehman – Division 2 Kristi Markey – Division 3 Michelle Knight – Division 4 David Pendergrass – Mayoral Representative David Potter – Monterey County Board of Supervisors Board members absent: None General Manager present: David A. Berger District Counsel present: David Laredo The assembly recited the Pledge of Allegiance. The following comments were directed to the Board during Oral Communications. (1) John Fischer, a resident of Pacific Grove, asked if California-American Water (Cal-Am) had developed a system maintenance program to replace old transmission pipes. He noted the system would only be upgraded if a maintenance plan was in place. (2) Steven Leonard, Cal-Am General Manager, thanked the public for reducing water use and lowering the year-to-date production total by 60 acre feet (AF) so that Cal-Am production is now only 35 acre-feet above the limit. (3) Susan Kippling congratulated the Board for adopting a resolution expressing opposition to Senate Bill 1529. She warned the Board that any future desalination project should not be owned by Cal-Am, but should remain a publicly held resource. On a motion by Director Pendergrass and second by Director Lehman, the Consent Calendar was adopted on a vote of 6 – 0, except for Item 7 that was pulled for separate consideration. In addition, Directors Lehman and Markey voted in opposition to Item 4. Adopted. Adopted. Adopted. The item was adopted on a vote of 4 – 2. Directors Edwards, Knight, Pendergrass and Potter voted in favor of the motion. Directors Lehman and Markey were opposed. Director Foy was absent. Adopted. Adopted. On a motion by Director Potter and second by Director Lehman, the Board authorized the expenditure of $2,500 for the rental of irrigation equipment on a vote of 6 – 0. Directors Edwards, Knight, Lehman, Markey, Pendergrass and Potter voted in favor of the motion. Director Foy was absent. Adopted. At the request of Director Edwards, Director Potter presented the resolution to Fran Farina. He acknowledged Ms. Farina for her success at handling the administrative functions of the District, and for her thorough knowledge of local water supply issues. Director Knight presented Ms. Farina with a framed photo of the Carmel River lagoon. Director Lehman presented Ms. Farina with a framed photo of the Carmel River that had been signed by District staff and Board members. Keith Israel, General Manager of the Monterey Regional Water Pollution Control Agency (MRWPCA) introduced the agency’s current Chair, David Pendergrass, and the past Chair, Peggy Sherril. He also acknowledged Director Knight as a previous member of the MRWPCA Board. Mr. Israel reviewed the background of the MRWPCA, described the current recycled water operations, noted current projects of interest, and described recycled water availability. A copy of the presentation is on file at the District office. Mr. Israel responded to questions from the Board following the presentation. He stated that MRWPCA is interested in developing an ASR project in which recycled water is injected into the groundwater basin and stored there until it is needed. The MRWPCA wastewater treatment plant is producing 13,500 AF per year of recycled water for reuse. The project could produce up to 23,000 AF per year. One goal of the MRWPCA is zero discharge into the Monterey Bay. General Manager Berger reported that Cal-Am production from the Carmel River basin was 11.13 percent under the month-end target. However, production is still 22.8 acre-feet above the annual goal. Managers of golf courses that utilize water from the CAWD/PBCSD Recycled Water Project have agreed to defer their flushing schedule until July 23, 2004, in order to conserve potable water and reduce Cal-Am production. Mr. Berger advised the Board that the District’s Santa Margarita injection well is temporarily being used to replace production from Cal-Ams Paralta Well that is off line due to a pump failure. General Manager Berger announced that the Board will conduct a Strategic Planning session in September 2004, at that meeting the Board will also set six-month goals for Mr. Berger. District Counsel Laredo reported that the Board met in closed session for a conference with its labor negotiators for the unrepresented employees in the confidential staff unit. The Board provided general direction to the negotiators and directed them to meet again with the confidential staff unit. Director Lehman asked to be included in any tour of the MRWPCA reclamation plant that is scheduled. She reported on the July 13, 2004 meeting of the Special Districts Association of Monterey County that she and General Manager Berger attended. One topic of discussion at the meeting was Proposition 65 regarding protection of revenues of local services. The District cannot take a political stand and financially support Proposition 65, so she urged the Directors to donate to the Proposition 65 campaign their compensation for attendance at one Board meeting. Director Markey reported that at the direction of the Board, she and Director Foy met on July 8, 2004 with representatives of the Monterra and Pasadera developments, Alan Williams and Michael Waxer, to continue discussions on Condition 19 of a water distribution system permit issued on July 21, 2003. The applicant will submit all information required in Condition 19 by September 30, 2004, and submit a revised application for a water distribution system in the fall of 2004. The applicant has requested that the Local Agency Formation Commission delay action on the application to succeed from the MPWMD boundaries. Director Potter reported that his office has received inquiries from the public regarding Caltrans’ installation of an irrigation system in the median on Highway 1. Director Potter asked District staff to contact Caltrans regarding this issue and report back to the Board. Director Knight reported that the Monterey County Hospitality Association has notified all its members about the water conservation and rationing program policies that the Association helped develop. In addition, table signs encouraging customers to conserve water were provided to Association members at no cost. Director Edwards thanked members of the public that opposed SB1529 and AB1300. He expressed hope that the public would allow the Board to move forward on carrying out the jobs they were elected to do. Director Edwards stated that he plans to work with the Board and public as much as possible. Director Foy made a motion to adopt Ordinance No. 116 on second reading. Director Knight seconded the motion, which was approved on a vote of 5 – 2. Directors Edwards, Foy, Knight, Pendergrass and Potter voted in favor of the motion. Directors Lehman and Markey were opposed. During the public hearing on this item, Robert Greenwood, representing the Carmel Valley Association, expressed opposition to adoption of Ordinance No. 116. He stated that the appointments should be non-political and based on the nominee’s interest in and knowledge of environmental issues on the Carmel River. Director Potter offered a motion to convene a public study session between the Board and the Policy and Technical Advisory committees to discuss Ordinance No. 117. Director Edwards seconded the motion. The motion was approved unanimously on a vote of 7 – 0. During the public hearing on this item, David Dilworth, representing Helping Our Peninsula’s Environment (HOPE), spoke in support of the motion to conduct a study session. Director Foy offered a motion that was seconded by Director Knight, to adopt the Water Demand Committee recommendation that Rule 25.5, as modified by Ordinance No. 115, will remain without a time requirement for ownership of adjacent properties before a new connection can be built using Water Use Credits. The motion was adopted on a vote of 5 – 2. Directors Edwards, Foy, Knight, Pendergrass and Potter voted in favor of the motion. Directors Lehman and Markey were opposed. During the public comment period on this item, Virginia Collister, a property owner and resident of Monterey County, spoke in support of the Water Demand Committee recommendation that no change should be made to Ordinance No. 115. On a motion by Director Knight and second by Director Pendergrass, the Board adopted Resolution 2004-11 with amendments proposed by District Counsel to: (1) Strike the word “temporary” from the title, from the first paragraph, and from the 15th paragraph; (2) in paragraph 16, line 2, add the word “would” between the words “which” and “result”; and (3) add a new finding that reads “the imposition of a moratorium would disable the financing and expansion of the CAWD/PBCSD Recycled Water Project which if successfully accomplished would reduce the demand for potable water for Cal Am and its sources of supply.” The motion was adopted on a vote of 6 – 1. Directors Edwards, Foy, Lehman, Knight, Pendergrass and Potter. Director Markey was opposed. The following comments were directed to the Board during the public comment period on this item. (1) Robert Greenwood, representing the Carmel Valley Association, spoke in opposition to establishment of a temporary water permit moratorium. (2) David Long, read a statement prepared by James Berg (on file at the District office), expressing opposition to establishment of a water connection moratorium. He also requested that if a moratorium is established, his water permit application should be processed due to unique circumstances. (3) Les Turnbeaugh, Deputy Public Works Director for the City of Monterey, expressed opposition to establishment of a water connection moratorium. He reported that the Monterey City Council will consider sending a letter to the California Public Utilities Commission in opposition to a moratorium. (4) Lloyd Lowrey, representing the Independent Reclaimed Water Users Group and the Monterey Peninsula Country Club, stated that establishment of a water connection moratorium could prevent implementation of plans for expansion of the Carmel Area Wastewater District (CAWD)/Pebble Beach Community Services District (PBCSD) Recycled Water Project. He proposed that the following language by added to Resolution 2004-11, “the imposition of a moratorium would disable the financing and expansion of the CAWD/PBCSD Recycled Water Project which if successfully accomplished would reduce the demand for potable water for Cal Am and its sources of supply.” (5) Myron Etienne, representing J. Lohr, a fiscal sponsor of the CAWD/PBCSD Recycled Water Project and owner of 78 acres of property in the Del Monte Forest, expressed support for comments made by previous speakers. He proposed that instead of establishing a moratorium, Cal-Am could impose strict conservation measures and work to reduce its unaccounted for water use. (6) Tex Irwin, representing the Monterey Peninsula Airport District, spoke in support of Resolution 2004-11. He agreed with the suggestion by Director Pendergrass that the reference to “temporary” moratorium in the title should be changed to the word “permanent.” (7) John Fischer, a resident of Pacific Grove, stated that he understands why Cal Am has proposed establishment of a water connection moratorium. He warned the Board that NOAA Fisheries has reported that this could be a mild La Niña weather year. (8) David Dilworth, representing HOPE, spoke in support of establishment of a water connection moratorium. He expressed opposition to adoption of Resolution 2004-11. (9) Mark Stilwell, representing the Pebble Beach Company, expressed agreement with comments made by Lloyd Lowrey. Mr. Stilwell stated that if a moratorium were imposed, it should not apply to Pebble Beach Company’s water entitlement from the CAWD/PBCSD Recycled Water Project. According to Mr. Stilwell, under SWRCB Order 95-10 use of the water entitlement increases the community water supply limit of 11,285 AF. (10) Jim Staples, owner of property in the City of Carmel-by-the-Sea, expressed support for adoption of Resolution 2004-11. He stated that the move to establish a moratorium is an effort by Cal-Am to solve a problem it has neglected to address over the years. (11) Steve Leonard, General Manager of Cal-Am, reported that an application for a moratorium could be filed with the CPUC in a month, but a definite date has not been set. The details of the application have not been finalized. There was no discussion of the Informational Items/Staff Reports. The meeting was adjourned at 9:50 PM.	CALL TO ORDER/ROLL CALL PLEDGE OF ALLEGIANCE ORAL COMMUNICATIONS CONSENT CALENDAR 1. Consider Adoption of Minutes of the Regular Board Meeting of June 21, 2004 2. Adopt Resolution of Appreciation for Fran Farina 3. Amend Contract for Water Demand Database Project CONSENT CALENDAR 4. Consider Adoption of Findings of Approval for Appeal of General Manager’s Decision to Deny a Water Use Credit for an Outdoor Fountain/Pond Pursuant to MPWMD Rule 24-C, Residential Fixture Unit Count – Jonathan D. Ryan, 1050 Marcheta Lane, Pebble Beach – APN: 007-342-008 5. Consider Contract Amendment with RAMLIT Associates for Computer Modeling Assistance 6. Consider Contract Amendment with Idias Consulting for Water Distribution System Permitting Assistance 7. Consider Authorization of Funds to Rent Irrigation Equipment for the San Carlos Area Irrigation System 8. Consider Adoption of Treasurer’s Report for May 2004 PRESENTATIONS 9. Presentation to Fran Farina by Chair Edwards 10. Keith Israel – Monterey Regional Water Pollution Control Agency Reclamation Project Partnership Possibilities PRESENTATIONS 10. Keith Israel – Monterey Regional Water Pollution Control Agency Reclamation Project Partnership Possibilities GENERAL MANAGER’S REPORT ATTORNEY’S REPORT 11. Report on Closed Session of July 19, 2004 DIRECTORS’ REPORTS 12. Board Comments and Referrals DIRECTORS’ REPORTS 12. Board Comments and Referrals PUBLIC HEARINGS 13. Consider Second Reading of Ordinance No. 116 – Amending Rule 120 to Modify Terms of Office for the Carmel River Advisory Committee 14. Consider First Reading of Ordinance No. 117 – Amending Rule 28-B Clarifying the Ministerial Review of Water Use Credit Transfer Applications, Setting Standard Conditions of Approval, and Setting Fees for Transfers and Review of New Technology ACTION ITEMS 15. Provide Direction on Modifications to Rule 25.5, Water Use Credits, Pertaining to Redevelopment Projects ACTION ITEMS 16. Consider Resolution in Opposition to an Anticipated Request by California-American Water that the California Public Utilities Commission Establish a Temporary Moratorium on New Water Connections and Expansion of Existing Water Connections in the Shortage-Affected Areas of its Monterey District ACTION ITEMS 16. Consider Resolution in Opposition to an Anticipated Request by California-American Water that the California Public Utilities Commission Establish a Temporary Moratorium on New Water Connections and Expansion of Existing Water Connections in the Shortage-Affected Areas of its Monterey District INFORMATIONAL ITEMS/STAFF REPORTS 17. Letters Received 18. Committee Reports 19. Strategic Planning Initiatives Progress Report 20. Carmel River Fishery Report 21. Water Conservation Program Report 22. Monthly Allocation Report 23. Monthly California-American Water Production Report 24. Production Report – CAWD/PBCSD Wastewater Reclamation Project 25. Monthly Water Supply Status Report 26. Quarterly Geographic Information systems Program Update 27. Quarterly Public Information Program Report 28. Quarterly Water Supply Project Status Report 29. Quarterly Irrigation Program and Riparian Projects Report 30. Quarterly Carmel River Erosion Protection and Restoration Projects Report 31. Quarterly Water Use Credit Transfer Status Report 32. Quarterly Cal-Am Sales Report ADJOURNMENT
U:\staff\word\boardpacket\2004\2004boardpacket\20040816\ConsentCalendar\01\item1_exh1a.doc	________________________________ David A. Berger, Secretary to the Board