Meeting Date:           July 17, 2006                                      Budgeted: N/A

Program/Line Item No.: N/A

From:                          David A. Berger,                                Cost Estimate: N/A

General Manager


Prepared By:              Henrietta Stern


General Counsel Approval:  N/A     

Committee Recommendation: N/A

CEQA Compliance: N/A


This is a quarterly report on District water supply augmentation projects for the April through June 2006 period.  The next quarterly report will be written in October 2006.  Limited background information is provided herein.  A detailed historical overview of previous action may be found in year 2003 and 2004 reports.  Information is also available as part of the weekly General Manager’s letter to the Board, and quarterly updates at the January, April, July and October regular Board meetings, all of which can be found on the District website at:


Based on a Strategic Planning Session held on September 8, 2005, and ratified at the October 17, 2005 regular meeting, the Board identified the following water supply objectives for year 2006:


WS1: Determine existing and future water needs.

WS2: Evaluate water supply options to meet community needs.

WS3: Determine MPWMD role in governance of Regional Urban Water Supply project.

WS4: Encourage public participation and understanding.

WS5: Pursue MPWMD water supply projects.

WS6: Create Board Water Supply Committee and charge (deleted January 26, 2006).


At the November 21, 2005 regular meeting, the Board approved six workshop dates to address specific water supply issues consistent with the six water supply objectives noted above.  Since then, the workshop schedule was revised to the five workshop dates as shown below:


1/25/06:  Aquifer Storage and Recovery (ASR) – Overview and Future Possibilities

2/22/06:  Regional Urban Water Supply Board Governance

3/23/06:  Water Needs Analysis, Existing Setting and Demand

5/18/06:  Water Needs Analysis, Future Demand at Buildout

6/29/06:  Desalination Projects Assessment


In addition, the annual Water Supply Augmentation Update (Comparative Matrix) will be reviewed at the August 17, 2006 Board meeting.


The following paragraphs describe action on Water Supply Objectives WS1 through WS5 in the April 1 through June 30, 2006 period.  For clarity, background information is provided for certain objectives.



At the March 23, 2006 special workshop, District staff concluded that, all things considered, 7,690 acre-feet per year (AFY) of replacement water would be needed at a minimum to meet existing water needs.  A maximum of 13,236 AFY could be needed, depending on the assumptions made.   A second workshop was held on May 18, 2006 to address future water needs, based primarily on projections made by the District’s Technical Advisory Committee (TAC), comprised of jurisdiction planning staff.  The TAC evaluated water needs associated with various types of uses anticipated at “build-out,” based on current General Plans.  An estimated 4,545 acre-feet would be needed to meet these needs, including a 20% “contingency” factor to cover unanticipated water needs or upgrades from current restrictions as well as “paying back” current retrofit credits allowed by MPWMD Rules & Regulations (“borrowed” against a future water allocation). 



At its February 23, 2006 meeting, the District Board approved retaining a team of water supply engineering design experts led by Bookman-Edmonston/GEI Consultants to conduct an independent technical evaluation of three proposed desalination projects previously reviewed in the comparative water supply matrix: (1) Coastal Water Project at Moss Landing proposed by California American Water (Cal-Am); (2) the Monterey Bay Regional Desalination Project at Moss Landing proposed by Pajaro/Sunny Mesa Community Services District (PSM); and (3) MPWMD desalination project proposed in the Sand City area.   Through mid-June 2006, District staff and consultants reviewed available reports and worked with Cal-Am and PSM to obtain the most recent available engineering and cost information.  This culminated in a report presented to the Board at its June 29, 2006 workshop.  The consultants provided an independent review of the following attributes for each of the three desalination projects:


Ø      Function (Purpose and Water Distribution);

Ø      Projected Performance (Desalination Process and Waste Stream);

Ø      Economics (Cost and Financing);

Ø      Regional Supply Considerations (Regional solutions and Redirected Impacts);

Ø      Implementability (Permits and Readiness to Proceed).


The consultants noted that all projects are at early stages of development, which precludes accurate comparisons of component costs.  Recommendations were made to increase the contingency amounts for the Moss Landing projects and reduce the estimated cost of operations for the MPWMD Sand City project.  The Board may request additional information on certain report elements depending on the amount of available funding and contract limits. 



District staff continues to coordinate with Monterey County Water Resources Agency (MCWRA), Monterey Regional Water Pollution Control Agency (MRWPCA),  Marina Coast Water District (MCWD) and other entities on regional water supply solution opportunities.  The District General Manager continues to participate in Monterey County-led meetings ofa Managers Working Group comprised of water/wastewater districts and cities from the Monterey Peninsula and north Monterey County, including the northern Salinas Valley, regarding a potential governance structure for a regional water supply planning entity currently known as the Monterey Bar Regional Water Authority (MBRWA).  At the MPWMD Board’s request during its February 22, 2006 workshop on this subject, local elected leaders of the above-noted public entities met on April 10, 2006 at the Seaside Community Center.  The outcome of this public meeting was that the Managers Working Group was asked to draft a proposed memorandum of understanding and scope of work to enable formal consideration of the regional water supply planning entity by all effected agencies at the earliest possible date.   A MOU has been drafted for review by the Managers Working Group later this month.  



District staff continues to communicate with the public through weekly updates posted to the District website and monthly presentations at Board meetings, which are carried by public access television.  Public participation and understanding of water supply issues are a major goal of the five special workshops noted above. 



The primary water supply efforts at this time focus on ASR, including: (1) continued testing of the existing full-scale Santa Margarita Test Injection Well; and (2) pursuit of the permanent Phase 1 ASR Project at the Santa Margarita test site, which entails completion of an Environmental Impact Report (EIR) and Environmental Assessment (EA) to meet state and federal environmental review requirements.   Both the existing and future ASR programs require permits from the State Water Resources Control Board (SWRCB) and other entities.  The adjudication of the Seaside Basin also affects water project activities.


For reference, at the September 2004 strategic planning workshop, the District Board confirmed that it would not proceed on further analysis of a local MPWMD-owned desalination project in the Sand City area at this time, and instead focus its efforts on collaboration with other agencies on regional water supply solutions, as well as pursue the MPWMD Phase 1 ASR Project planned to be operational in year 2007.  In June 2005, the Board approved a user fee adjustment to fully fund the Phase 1 ASR Project.


Conduct ASR Testing in 2006   

ASR entails diverting excess water flows (typically in Winter/Spring) from the Carmel Valley Alluvial Aquifer through existing Cal-Am facilities and injecting the water into the Seaside Groundwater Basin for later recovery in dry periods.  Since 1996, the District has evaluated the feasibility of ASR at greater levels of detail, including obtaining annual temporary water rights to divert water from the Carmel River Basin water and inject it into the Seaside Basin.  From 1998 through March 2005, the District injected approximately 1,450 acre-feet (AF) of excess winter flow from the Carmel River Basin into the Seaside Basin at the MPWMD Santa Margarita Test Injection Well (SMTIW) located on the former Fort Ord military base, just east of General Jim Moore Boulevard near Eucalyptus Avenue.  During this period, approximately 1,140 AF were recovered and delivered to the community via the Cal-Am system as part of the test program. 


On December 14, 2005, the District received a temporary permit #21175 from the SWRCB for continued ASR testing through May 2006, pending adequate flows in the Carmel River as set by the SWRCB in consultation with federal and state fishery agencies.  An annual diversion limit of 650 AF was set for 2006.  Injection testing began on January 4, 2006 and proceeded until January 31, 2006, when flows dwindled.  Diversions began anew on February 27, 2006 and continued through May 2006.  In Water Year 2006, a total of 411 AF were diverted and injected into the Seaside Basin.  Thus, the grand total to date is 1,863 AF at the SMTIW site.  As water was injected, various testing efforts associated with water quality and storage were carried out. 


District and Cal-Am representatives finalized a Management and Operations Agreement (MOA) regarding ASR testing, mutual aid, cost-sharing, water rights and other issues.  The MOA was signed by both parties in late March 2006.  Since then, cooperative meetings and action on ASR technical issues and water rights have occurred. 


Prepare Draft EIR/EA to Evaluate MPWMD ASR Project

In Fall 2004, the Board directed staff to prepare an EIR on the District’s ASR project, and retained Jones & Stokes Associates (JSA) and Padre Associates to assist in this effort.  A Notice of Preparation of an EIR was issued on December 13, 2004.  Based on comments received, the Board in March 2005 directed staff and consultants to focus only on the Phase 1 project.  Please refer to the January 2006 quarterly report or weekly reports on the District website for specific details on the project and document preparation history. 


The primary goal of the MPWMD Phase 1 project is better management of existing water resources to help reduce current impacts to the Carmel River, especially during the dry season.  The project is viewed as being complementary to other larger, long-term water augmentation projects that are currently being explored by various entities.  The project entails a maximum diversion of 2,400 acre-feet per year (AFY) from the Carmel River for injection, a maximum extraction of 2,000 AFY from the ASR wells in the Seaside Basin, and an average yield of about 1,050 AFY.  The proposed operation of the Phase 1 ASR Project would result in reduced pumping of the Carmel River in the Summer/Fall and increased storage in the Seaside Basin, which are both considered to be environmentally beneficial. 


At a December 22, 2005 meeting between the staffs of the U.S. Army, MPWMD and Cal-Am, the Army staff confirmed that the EIR/EA adequately addressed the environmental effects of the MPWMD Phase 1 ASR Project.  However, the Army also indicated that a permit (easement) for the Phase 1 ASR project could not be issued until another Environmental Assessment was prepared for a temporary Cal-Am pipeline to help improve existing operational flexibility and maximize the Phase 1 ASR Project performance.  The Army position was a significant, substantial change from previous direction to both MPWMD and Cal-Am.  The Army recommended that the Cal-Am temporary pipeline information be incorporated into the EIR/EA for the MPWMD Phase 1 ASR project as the most efficient way to facilitate issuance of two separate permits – one to MPWMD for the ASR Project and one to Cal-Am for the temporary pipeline.   On January 12, 2006, Cal-Am agreed to separately pay Jones & Stokes to add the pipeline information into the District’s EIR.  The new information was incorporated, then reviewed by MPWMD, Cal-Am and the Army prior to formal release for public review in late March 2006.


On March 23, 2006, the District issued the Draft EIR/EA on the MPWMD Phase 1 ASR Project, including information on the temporary pipeline for NEPA (Army) purposes.  District action only addresses the CEQA EIR component.  The document was circulated for comments through May 8, 2006, and an extension May 22, 2006 was granted to agencies that requested it.  A public hearing to receive oral comments was held on April 17, 2006.   A Notice of Availability, Executive Summary and detailed impact table are on the District website:


A total of nine comment letters and one oral comment (referring to a letter) were received in May and early June 2006.  Staff and consultants continue to develop responses to public comments, with emphasis on comments submitted by California Dept. of Fish and Game (CDFG), and NOAA Fisheries, which encapsulate many comments offered by other entities.  Key tasks have included meetings and other communications to educate CDFG and NOAA staff, computer modeling, and preparing specific text for ASR operations and mitigation measures to demonstrate benefit to and protection of the Carmel River.  These efforts reflect the verbal concurrence with CDFG and NOAA obtained in May-June 2006 based on several meetings and information exchanges.  Notably, both CDFG and NOAA previously filed water rights protests, which the District General Manager wishes to have fully resolved prior to the certification of the Final EIR/EA.  This parallel track will avoid the need to revise the adopted FEIR or its Mitigation and Monitoring Plan if the water rights protest process resulted in a different outcome than the CEQA process.  Due to the ASR Management and Operations Agreement (MOA) signed between the District and Cal-Am, the proposed water rights protest dismissal text needs to be reviewed by Cal-Am before transmittal to CDFG and NOAA for final signoff.  Due to Cal-Am staff vacations, holidays and needed review time, this series of steps cannot be completed in time for certification of the Final EIR on July 17, 2006; instead, the goal is now August 21, 2006.   


Obtain Water Rights Permit for ASR Project

District staff met with SWRCB staff on June 21, 2006 to continue to: (1) update the SWRCB on responses to comments on the Draft  EIR/EA on the Phase 1 ASR project, particularly the efforts to address CDFG and NOAA concerns (see above); (2) describe coordination with Cal-Am; (3) determine next steps for the District’s permit application for water rights for the long-term ASR project; (4) discuss other District water rights issues; and (5) describe Seaside Basin status and activities.  Regarding Item 3, two Petitions for Change were originally submitted by the District in October 2001 and revised in September 2003.  The SWRCB noticed the District’s Petitions on April 15, 2005.  The District prepared formal responses to the National Marine Fisheries Service (NOAA Fisheries) and California Department of Fish & Game (CDFG) protests in mid-June and July 2005, respectively.  Since then, the District has worked with NOAA and CDFG regarding protest dismissal terms.   If the two protests are dismissed, the SWRCB could issue a water rights permit for the Phase 1 ASR Project administratively in a short period of time.  


In related action, District staff is communicating with SWRCB staff about the water rights for the associated with the New Los Padres Reservoir Project (issued in 1995).  As noted above, the District obtained a temporary urgency permit for the 2006 test season for the existing ASR test well.   On a positive note, an important element of the MOA between MPWMD and Cal-Am is retraction of previous Cal-Am complaints and other communications to SWRCB challenging various water rights held by or proposed by MPWMD. 


Obtain Use Permit from City of Seaside for ASR Project

After an initial consultation meeting, The District submitted an application and fees for a Conditional Use Permit (CUP) to the City of Seaside on May 26, 2006.  In a letter dated June 25, 2006, the City determined that the application was not complete.  It asked for certain property owner and construction-related information and requested consideration of an altered site location.  The letter also asserted proposed terms for a joint easement from the U.S. Army, which the District questioned as a real estate issue rather than a use permit issue.  In its response letter dated June 29, 2006, the District requested a meeting with City officials to discuss these issues.  The earliest a meeting is feasible is in mid-July 2006.   


Participate in Seaside Basin Management as Part of Watermaster 

Litigation filed by Cal-Am on August 14, 2003 asserted Cal-Am’s water rights and requested a Court adjudication of the Seaside Basin.    The District was a recognized Interested Party and participated in all litigation activities through 2005.  Judge Robert Randall rendered a Final Decision on March 27, 2006.  The complex and lengthy Decision determined that the Seaside Basin is in overdraft; set a reduced “natural safe yield” and a near-term “operating yield” allowed to be produced by the parties as they work toward a “physical solution” (including ASR and wastewater reclamation) to eliminate the overdraft.   A nine-member Watermaster Board was created to implement the Decision with continued oversight by the Court.  The MPWMD holds one seat on the Watermaster with two out of 13 votes.  The MPWMD Board selected Chairwoman Michelle Knight as the MPWMD representative to the Watermaster Board.  The Watermaster has held several meetings since its formal commencement on April 5, 2006.  District staff have also participated  on the Watermaster Technical Committee and contributed significantly to the Basin Monitoring and Management Program report that was submitted to the Court in late May 2006 (within 60 days of the Final Decision).


Interagency Cooperation

District staff continued to work with Cal-Am staff and consultants to discuss ways to further ASR as a needed component of the “water portfolio” for the Peninsula, both now and in the future.  The District continues to work with Cal-Am and resource agencies to develop quarterly management strategies to reduce impacts to the Carmel River and Seaside Basins, while meeting community water needs. 


District staff led the effort to obtain $497,000 of Proposition 50 grant funds to prepare an Integrated Regional Water Management Plan (IRWMP) for the Monterey Bay Area.  Final written approval of State Department of Water Resources (DWR) funding was made in early January 2006.  Since then, the District staff has worked closely with its local public and non-profit partners to complete the IRWMP, including retaining specialized consultants for this type of work.  Completion of a professional IRWMP will position our Area to receive implementation funds for specific projects, such as the MPWMD ASR Project.



The following table summarizes related water augmentation efforts in the January–March 2006 period.  These activities do not directly reflect the six water supply objectives, but are relevant to overall water supply efforts. 






Seismic Retrofit and Sediment Removal from San Clemente Reservoir.

District staff participates in the EIR/EIS process on the seismic retrofit of San Clemente Dam. Potential removal of sediment from San Clemente Dam continues to be explored by Cal-Am, California Department of Resources (DWR), and the U.S. Army Corps of Engineers (USCOE).  District staff participates in technical meetings and provides technical expertise upon request.  In late June 2006, District staff submitted extensive technical comments on the Draft EIR/EIS issued in April 2006.  


Implement and Refine Water Distribution System (WDS) Rules and Regulations.

Ordinance No. 122 refining the Water Distribution System (WDS) process became effective on September 14, 2005.  The ordinance created a Pre-Application process for all new wells in the District along with an impact-based, multi-level permit process, based on the size, location and water use of affected parcels.  Staff and consultants continue to refine Implementation Guidelines and forms to accompany the ordinance.  More than 20 applications are currently at various stages in the permit process.  In a related matter, the Board in June 2006 approved a Negative Declaration and the first reading of Ordinance No. 124 to exempt projects in the Former Fort Ord served by water sources other than the Carmel River or Seaside Basin from MPWMD WDS regulations.  This is most pertinent to service by Marina Coast Water District for redevelopment as part of Fort Ord Reuse Plan. 


Review CEQA Documents for Other Projects


The District logs incoming CEQA notices and comments on selected documents prepared by other agencies for projects within the District boundary that could potentially affect water supply, water quality or environmental resources managed by the District.  Projects or issues of note in April-June 2006 included adequate water supply for new development at Ryan Ranch (Monterey) and the Recirculated Portion of a Revised Draft EIR for the proposed September Ranch Subdivision (Carmel Valley).





Draft 3, reviewed by DAB 7/10/06 and JO 7/11/06