EXHIBIT 14-H

DRAFT

MONTEREY PENINSULA WATER MANAGEMENT DISTRICT (MPWMD)

FINDINGS of DENIAL of APPEAL

CONSIDER APPEAL OF HEARING OFFICER DETERMINATION RE: APPROVAL OF BARDIS WATER DISTRIBUTION SYSTEM; APN 169-181-051

Adopted by MPWMD Board of Directors on January 27, 2005

Unless otherwise noted, all evidence is on file and available for public review at the District office, 5 Harris Court, Bldg. G, Monterey (Ryan Ranch)

It is hereby found and determined as follows:

1. FINDING: Applicant Christo Bardis is the owner of property at the intersection of Carmel Valley and Schulte Roads, Carmel Valley. The existing parcel (APN 169-181-051) is 10.02 acres in size. Applicant applied for a permit to create the Bardis Water Distribution System (WDS) for a well to provide both potable and non-potable water on existing parcel APN 169-181-051 as allowed by Monterey County zoning and health regulations.

EVIDENCE: Application #20040426BAR, site map and application materials dated April 26, 2004 available for review at District office.

2. FINDING: Based on a public hearing held on November 19, 2004, the MPWMD Staff Hearing Officer on November 24, 2004 approved the application to create the Bardis WDS subject to 20 conditions.

EVIDENCE: MPWMD WDS Permit #S04-03 and associated Final Conditions of Approval, Final Findings of Approval and CEQA Notice of Exemption, all dated November 24, 2004. MPWMD Hearing Record for hearing held on November 19, 2004; MPWMD Order Following Hearing prepared by Hearing Officer on November 24, 2004.

3. FINDING: Condition No. 3 of Permit #S04-03 sets a system capacity (production limit) of 14.910 acre-feet per year (AFY divided as follows: 0.444 AFY for residential uses, including landscape irrigation, and 14.466 AFY for agricultural irrigation. These numbers were based on a June 7, 2004 Court Order and Stipulation affecting the Bardis parcel as well as a 1994 Grice Engineering Report specifically referred to in the Court Order.

EVIDENCE: MPWMD WDS Permit #S04-03 and associated Final Conditions of Approval dated November 24, 2004. MPWMD Order Following Hearing prepared by Hearing Officer on November 24, 2004. Monterey County Superior Court Case No. M43343 (Save Our Carmel River v. County of Monterey, et al.), including Stipulation and Order re: Water Usage on Remainder Parcel dated June 7, 2002. Hydrology Study and Nitrate Loading Assessment for the Mills College Property Minor Subdivision at Carmel Valley Road and Schulte Road, Carmel Valley, prepared by Grice Engineering, Inc., dated November 14, 1994.

4. FINDING: The applicant has appealed the Hearing Officer determination in accordance with MPWMD Rule 22-A-2 and Rule 70. The applicant agrees with the total parcel limit of 14.910 AFY, but requests a higher allotment than 0.444 AFY for the residential indoor and landscape uses. Specifically, an amount of 0.50 AFY is requested for indoor uses only; alternatively, an amount of 0.70 AFY is requested for the combined residential indoor and landscape uses for the home. The remaining amount would be designated for the agricultural use.

EVIDENCE: December 20, 2004 Application for Appeal, including cover letter, application form, exhibits, check for $750, and Disclosure Statement. MPWMD Rules and Regulations.

Rationale for Denial of Appeal

5. FINDING: MPWMD approval of the appeal, without further CEQA review, would not comply with CEQA given the unique legal history of the Bardis parcel and a Court Order and Stipulation addressing CEQA compliance for water use one the property. The Notice of Exemption filed by MPWMD for the November 24, 2004 approval of the Bardis WDS relied in part on compliance with the conditions specified in the June 7, 2004 Court Order and Stipulation (Part 3). The Court Order stated that further CEQA review would not be required if the specified conditions were followed. The applicant’s request for additional residential water allotment goes beyond the amount specified in Condition G of the Court Order (i.e., the amount specified in the November 1994 Grice Report).

EVIDENCE: MPWMD WDS Permit #S04-03 and associated Final Conditions of Approval dated November 24, 2004. MPWMD Order Following Hearing prepared by Hearing Officer on November 24, 2004. MPWMD Notice of Exemption for approval of Bardis WDS dated November 24, 2004. Monterey County Superior Court Case No. M43343 (Save Our Carmel River v. County of Monterey, et al.), including Stipulation and Order re: Water Usage on Remainder Parcel, dated June 7, 2002. Hydrology Study and Nitrate Loading Assessment for the Mills College Property Minor Subdivision at Carmel Valley Road and Schulte Road, Carmel Valley, prepared by Grice Engineering, Inc., dated November 14, 1994. Exhibit 5 of November 19, 2004 MPWMD hearing materials (site history).

6. FINDING: Though MPWMD is not bound by the Court Order and Stipulation, MPWMD believes that prudent management includes consistency with Monterey County regulations and activities whenever possible. Monterey County and its health, land use planning and water resources management departments were directed by the Court to ensure compliance with the water use limitations specified in Part 3A through 3G of the Court Order and Stipulation. Thus, MPWMD chooses to comply with the Court Order to avoid confusion and foster consistent standards for the Bardis parcel.

EVIDENCE: Monterey County Superior Court Case No. M43343 (Save Our Carmel River v. County of Monterey, et al.), including Stipulation and Order re: Water Usage on Remainder Parcel, dated June 7, 2002.

7. FINDING: The MPWMD Hearing Officer properly identified the quantity of water for residential indoor use and associated landscaping on the Bardis parcel, based on specific text in the 1994 Grice Report, as directed by the Court Order and Stipulation (Part 3-G).

EVIDENCE: MPWMD WDS Permit #S04-03 and associated Final Conditions of Approval dated November 24, 2004. MPWMD Order Following Hearing prepared by Hearing Officer on November 24, 2004. Monterey County Superior Court Case No. M43343 (Save Our Carmel River v. County of Monterey, et al.), including Stipulation and Order re: Water Usage on Remainder Parcel, dated June 7, 2002. Hydrology Study and Nitrate Loading Assessment for the Mills College Property Minor Subdivision at Carmel Valley Road and Schulte Road, Carmel Valley, prepared by Grice Engineering, Inc., dated November 14, 1994.

8. FINDING: The applicant appeal asserts that the 1994 Grice Report is outdated and the report assumptions on average family size per parcel are too low for the applicant’s specific family situation. Although the Grice Report stated it should be reviewed after three years, the Court Order compels use of the 1994 Grice Report. No language is contained in the Court Order that refers to updates, review or alterations to the Grice Report. The Grice Report could not have predicted the specific family size of future owners of the parcels evaluated in 1994. MPWMD Rules and Regulations stress use of water-using fixtures or other more stable units of measurement (such as regional averages), rather than individual family size at a particular point in time, due to the ever-changing nature of individual family situations.

EVIDENCE: December 20, 2004 Application to Appeal Hearing Officer Determination on Bardis WDS. MPWMD Order Following Hearing prepared by Hearing Officer on November 24, 2004. Monterey County Superior Court Case No. M43343 (Save Our Carmel River v. County of Monterey, et al.), including Stipulation and Order re: Water Usage on Remainder Parcel, dated June 7, 2002. Hydrology Study and Nitrate Loading Assessment for the Mills College Property Minor Subdivision at Carmel Valley Road and Schulte Road, Carmel Valley, prepared by Grice Engineering, Inc., dated November 14, 1994. MPWMD Rules and Regulations. MPWMD staff analysis for January 27, 2005 public hearing.

9. FINDING: The applicant appeal cites a September 20, 2004 letter from Harold Grice that contradicts text in the November 1994 Grice Report. The September 2004 letter asserts that the water use figures included only indoor use, while the 1994 Report text states that water use figures represented both indoor and outdoor use. The September 20, 2004 letter offers no evidence, documentation or rationale to justify the revised statements. The MPWMD Hearing Officer considered, but did not accept, the changed interpretation in the September 20, 2004 Grice letter. Also, the Court Order compels use of the 1994 Grice Report. No language is contained in the Court Order that refers to updates, review or alterations to the Grice Report.

EVIDENCE: December 20, 2004 Application to Appeal Hearing Officer Determination on Bardis WDS. Letter dated September 20, 2004 from Harold Grice to Henrietta Stern. MPWMD Order Following Hearing prepared by Hearing Officer on November 24, 2004. Monterey County Superior Court Case No. M43343 (Save Our Carmel River v. County of Monterey, et al.), including Stipulation and Order re: Water Usage on Remainder Parcel, dated June 7, 2002. Hydrology Study and Nitrate Loading Assessment for the Mills College Property Minor Subdivision at Carmel Valley Road and Schulte Road, Carmel Valley, prepared by Grice Engineering, Inc., dated November 14, 1994. MPWMD staff analysis for January 27, 2005 public hearing.

10. FINDING: The applicant appeal asserts that four neighboring parcels involved in the original Mills College Subdivision received a Monterey County water allotment of 1.0 AFY per parcel, and requests “equal treatment” from MPWMD. The 1.0 AFY quantity was designated by Monterey County, not MPWMD, in direct violation of MPWMD Ordinance No. 81, which had designated only 0.5 AFY per parcel of metered California American Water (Cal-Am) sales for each parcel (total of 2.0 AFY metered sales for the four parcels). The MPWMD Hearing Officer properly identified the 0.444 AFY quantity of water for residential indoor use and associated landscaping on the Bardis parcel, based on specific text in the 1994 Grice Report, as directed by Part 3-G of the Court Order and Stipulation for the “remainder” parcel (i.e., the Bardis parcel). The Court Order does not allow “equal treatment” as the subject parcel is specifically identified. If “equal treatment” by MPWMD were allowed, the quantity would be 0.5 AFY, not 1.0 AFY, pursuant to MPWMD Ordinance No. 81.

EVIDENCE: December 20, 2004 Application to Appeal Hearing Officer Determination on Bardis WDS. MPWMD Order Following Hearing prepared by Hearing Officer on November 24, 2004. Monterey County Superior Court Case No. M43343 (Save Our Carmel River v. County of Monterey, et al.), including Stipulation and Order re: Water Usage on Remainder Parcel, dated June 7, 2002. Hydrology Study and Nitrate Loading Assessment for the Mills College Property Minor Subdivision at Carmel Valley Road and Schulte Road, Carmel Valley, prepared by Grice Engineering, Inc., dated November 14, 1994. MPWMD Ordinance No. 81 adopted on November 20, 1995. MPWMD staff analysis for January 27, 2005 public hearing.

11. FINDING: Denial of the appeal does not prevent the applicant from enjoying beneficial use of the property. The approval of the Bardis WDS on November 24, 2004 would remain in effect. The water quantities are adequate for a reasonably sized home and extensive agricultural irrigation on the property. Denial of the appeal does not constrain the applicant from obtaining new information, such as additional CEQA evaluation by Monterey County, an amended Court Order, or other documentation to support an application to MPWMD to amend the Bardis WDS pursuant to MPWMD Rule 22-E.

EVIDENCE: MPWMD WDS Permit #S04-03 and associated Final Conditions of Approval dated November 24, 2004, Condition #11. MPWMD Rules and Regulations, Rules 20-22.

Compliance with CEQA

12. FINDING: An action to deny an appeal is exempt under CEQA. In the previous review of this application, MPWMD has followed those guidelines adopted by the State of California and published in the California Administrative Code, Title 14, Section 15000 et seq.

EVIDENCE: CEQA and CEQA Guidelines, Section 15000 et seq. Notice of Exemption for approval of the Bardis WDS dated November 24, 2004, was transmitted to the County Clerk on November 30, 2004.

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