Meeting Date:

December 13, 2004





David A. Berger,




General Manager

Line Item No.:




Prepared By:


Stephanie Pintar

Cost Estimate:


General Counsel Approval:  Staff note was provided for review

Committee Recommendation:  N/A

CEQA Compliance:  CEQA review by City of Seaside determined project is exempt from CEQA. Notice of Exemption filed November 2, 2004.


SUMMARY:  Pursuant to District Rule 28-B (Property-To-Property And Property-To-Jurisdiction Transfers Of Water Use Credits For Commercial And Industrial Uses), the Redevelopment Agency of the City of Seaside has applied to transfer 2.166 AF (acre-feet) of commercial Water Use Credits from APN 011-293-002 (a.k.a. 866-890 Broadway Avenue) in Seaside to the City of Seaside (Exhibit 12-A).  District Rule 28-B allows the transfer of Water Use Credits to a jurisdiction’s allocation when the credits originate from prior documented commercial water use capacity (Rule 28-B (9)).  The Water Use Credit proposed for transfer originated from documented commercial uses that included a movie theater, restaurant, two beauty salons, a photo processing store and retail uses.  The buildings were demolished in December 1994.


The Water Use Credit that is the subject of this transfer expires on December 27, 2004.  The City of Seaside approached the District earlier this year for information about the process for transferring the credit.  The property-to-jurisdiction application for water credit transfer was received on August 4, 2004, but was deemed incomplete.  The complete application was submitted October 18, 2004. 


The City of Seaside completed the CEQA (California Environmental Quality Act) analysis on the water credit transfer and found that the project is exempt from CEQA under Section 15302, Class 2 (Exhibit 12-B).  The City filed a Notice of Exemption at that time as the Lead Agency under CEQA.  It should be noted that the application packet included both an Environmental Checklist and a Notice of Exemption.  The Notice of Exemption was filed with Monterey County on November 2, 2004.  District staff asked the City of Seaside for clarification regarding the outcome of the Environmental Checklist that indicated that a Negative Declaration was in order.  Seaside’s response to the District is attached as Exhibit 12-C.  At the August 26, 2004 joint special meeting of the Board, TAC (Technical Advisory Committee), and PAC (Policy Advisory Committee), members of the TAC and PAC acknowledged that CEQA (California Environmental Quality Act) review of each transfer request would be required by the jurisdiction prior to consideration by the District’s Board of Directors.  It was also acknowledged that as part of its deliberation when an application to transfer water credits, the Board would consider the CEQA analysis of the jurisdiction and any cumulative impacts of the project. 


The Redevelopment Agency’s application to transfer Water Use Credits would result in a net transfer of 1.841 AF of water to the jurisdiction’s allocation (the remaining 0.325 AF would be retained by the District as permanent conservation savings).  The City of Seaside has indicated that the water will be returned to the site for a redevelopment project that is substantially the same capacity and size as the structure(s) being replaced.  District Rule 28-B (7) does not prohibit a property-to-jurisdiction water credit transfers from being banked in a jurisdiction’s allocation for a future use, whereas property-to-property transfers do not allow banking of water credits for future use.  The use of credits resulting from a property-to-jurisdiction transfer is “at the discretion of the jurisdiction.” (District Rule 28-B (8)).


The City of Seaside also indicated in its December 2, 2004 letter to the District (Exhibit 12-C) that staff intends to pursue a Conditional Water Permit for the site concurrently with the application to transfer.  In this regard, Seaside’s City Council is scheduled to consider the topic at a special meeting on December 9, 2004.  District Rule 23-D (Exhibit 12-D) outlines the application and approval process for conditional permits.  A conditional permit creates a record that specifically quantifies the increment of water assigned for use at the location designated by the jurisdiction and debits the jurisdiction’s water allocation.  Conditional Water Permits are available to projects that are unable to meet all of the criteria of Rule 23-A-1 (a) (the District’s regular permit process), but that meet criteria for a conditional permit.  These criteria include (1) large projects with a projected water demand of over one acre-foot annually, and (2) governmental projects that are owned and operated, or financed by a governmental agency.  Conditional water permits meeting the criteria listed above are ministerial actions of the District.  In the event that the City of Seaside approves the application and applies for a Conditional Water Permit, the applicant may withdraw its water credit transfer application and there would be no need for a public hearing.


RECOMMENDATION:  Prior to considering the Seaside Redevelopment Agency’s request for a property-to-jurisdiction transfer, the Board, as a Responsible Agency under CEQA, should concur with the City’s determination that the project is exempt from CEQA.  Based on the information in the District’s file and in the application submitted by the Seaside Redevelopment Agency, staff concludes that the City of Seaside has submitted confirmation that (1) the water credit being transferred will be returned to the site, and (2) that the replacement structure(s) will have substantially the same purpose and capacity as the structure(s) replaced.  These findings must be made to support a Notice of Exemption under Section 15302, Class 1.  Staff recommends the Board direct staff to prepare and file a Notice of Exemption based upon the documentation provided by the City.  A copy of the guideline for Section 15302 is attached as Exhibit 12-E.


The application to transfer Water Use Credits from APN 011-293-002 (Broadway and Fremont, Seaside) to the City of Seaside meets the criteria to transfer credit listed under Rule 28-B.  If approved, the District would retain 15 percent of the Water Use Credit (0.325 AF) as permanent conservation savings, resulting in a net transfer of 1.841 AF.  A copy of District Rule 28-B is attached as Exhibit 12-F. 

As this item is a quasi-judicial decision, Rule 181 requires the Board to disclose any oral or written ex parte communications they may have received from effected parties.  Disclosure should occur prior to consideration of the transfer request.


If the application is approved, the following conditions should be attached to the approval:


  1. The applicant that the replacement structure(s) on the site to which the transferred water is returned shall have substantially the same purpose and capacity (as defined in Rule 11).
  2. The applicant will be required to remove any unused water meter on the site and record a deed restriction on the property stating that the Water Use Credits have been permanently abandoned as a result of the transfer.  Cal Am was unable to very the presence of any water meters on the transfer site.
  3. The applicant is required to verify under penalty of perjury that no valuable consideration has been given in exchange for use of the water credit.
  4. The applicant is required to enter into an indemnification agreement with the District as a condition of approval, giving the City of Seaside full legal and financial responsibility for all liability and litigation that may arise as a result of this transfer.


BACKGROUND:  The Redevelopment Agency of the City of Seaside’s Water Use Credit originated from demolition of mixed-use commercial buildings at the site on December 27, 1994.  The water credit expires December 27, 2004, unless transferred to the jurisdiction.  The location of the Water Use Credit is presently a vacant lot at the intersection of Broadway Avenue and Santa Barbara Street, immediately west of Fremont Boulevard.



12-A    Application for Water Credit Transfer

12-B    Notice of Exemption, Received October 21, 2004

12-C    City of Seaside Correspondence Related to CEQA Conclusion, Dated December 3, 2004

12-D    District Rule 23-D

12-E    Section 15302 of the 2004 CEQA Guidelines

12-F     District Rule 28-B