ITEM:		PUBLIC HEARINGS
10.	CONSIDER ADOPTION OF OCTOBER THROUGH DECEMBER 2006 QUARTERLY WATER SUPPLY STRATEGY AND BUDGET
Meeting Date:			September 18, 2006	Budgeted:	N/A
From:			David A. Berger,	Program/	N/A
			General Manager	Line Item No.:
Prepared By:			Darby Fuerst	Cost Estimate:	N/A
General Counsel Approval: N/A
Committee Recommendation: N/A
Committee Recommendation: Notice of Exemption, CEQA, Article 19, Section 15301 (Class 1)
ESA Compliance: Consistent with the September 2001 Conservation Agreement between the National Marine Fisheries Service and California American Water to minimize take of listed steelhead in the Carmel River, Consistent with SWRCB WR Order Nos. 95-10, 98-04, and 2002-0002.

SUMMARY: The Board will accept public comment and take action on the October through December 2006 Quarterly Water Supply Strategy and Budget for the California American Water (Cal-Am) Water Distribution System (WDS). The proposed budget, Exhibit 10-A, is based on “above normal year” inflow conditions for the first quarter of the Water Year 2007 (WY 2007). Specifically, the budget utilizes monthly inflows that are expected to be exceeded about 30% percent of the time at the San Clemente Dam site. The proposed strategy and budget is designed to maximize the long-term production potential and protect the environmental quality of the Seaside Groundwater and Carmel River Basins.

Exhibit 10-A shows the anticipated production by Cal-Am for each production source. Exhibit 10-A also shows actual production values for the water year to date. Please note that the anticipated production values assume that Cal-Am annual system production will not exceed 14,789 acre-feet (AF), including 3,504 AF from the Seaside Groundwater Basin and 11,285 AF from the Carmel River Basin. The total from the Carmel River Basin is consistent with SWRCB Order No. 95-10 and the total from the Seaside Groundwater Basin is consistent with the Seaside Basin adjudication decision. It should be noted, however, that Cal-Am’s annual production limit from the coastal subareas of the Seaside Basin (3,504 AF) is tracked on a calendar year basis.

For the first 11 months of Water Year 2006, Cal-Am’s production from Carmel River sources is below the SWRCB-based production target by 561 AF or 5.5 %. In addition, during this time, Cal-Am’s production from the coastal subareas of the Seaside Groundwater Basin is below the production target set by the court in the Seaside Basin Adjudication (Case No. M66343, Monterey County Superior Court) by approximately 110 AF or 3.1%. For the purpose of this budget, it is assumed that no water from the Carmel River Basin will be diverted and injected into the Seaside Groundwater Basin during the October through December 2006 period.

RECOMMENDATION: The Board should receive public input, close the Public Hearing, and discuss the proposed water supply budget. District staff recommends adoption of the proposed budget. The budget is described in greater detail in Exhibit 10-B, Quarterly Water Supply Strategy Report: October – December 2006.

BACKGROUND: The Quarterly Water Supply Strategy and Budget pertains to production within the Cal-Am WDS for the three-month period of October, November, and December 2006. This strategy was developed cooperatively by staff from the District, Cal-Am, the National Marine Fisheries Service (NMFS), and the California Department of Fish and Game (CDFG). Based on current usable storage conditions in San Clemente Reservoir (1 AF or 1.5% of capacity) and Los Padres Reservoir (1,071 AF or 72.5% of capacity) and streamflow conditions at the District’s Don Juan gaging station in Garland Park (11 cubic feet per second (cfs)), it was agreed that Cal-Am would not divert any water from San Clemente Reservoir through the Carmel Valley Filter Plant, except in the case of emergency conditions. This limitation is consistent with the 4d rules adopted by the NMFS to protect aquatic habitat and with the Conservation Agreement (CA) between NMFS and Cal-Am, which governs diversions during low-flow periods.^[1] For purposes of the CA, the low-flow periods are defined as times when streamflow in the Carmel River at the District gage at the Don Juan Bridge is less than 20 cfs for five consecutive days. If actual inflows are more or less than projected for the budget period, the group will reconvene and adjust the diversion and release rates accordingly.

The proposed budget also allows Cal-Am to divert a maximum of 0.5 cfs (approximately 31 AF/month) from its Russell wells in the Upper Carmel Valley. As proposed, Cal-Am will reduce its current production from the coastal area of the Seaside Basin (approximately 530 AF/month) to 450 AF, 400 AF, and 350 AF in October, November, and December, respectively. These reductions are scheduled to match reduced customer demands during the Fall and Winter months and will allow Cal-Am to stay within the production allocation specified by the adjudication decision (3,504 AF/year). The remainder of Cal-Am’s customer demand will be met by groundwater production from the Lower Carmel Valley aquifer. Cal-Am will operate its wells in the Lower Carmel Valley in a downstream-to-upstream order.

Rule 101, Section B of the District Rules and Regulations requires that a Public Hearing be held at the time of determination of the District water supply management strategy. Notice of this Public Hearing has been published in The Herald. Adoption of the quarterly water supply strategy and budget is categorically exempt from the California Environmental Quality Act (CEQA) requirements as per Article 19, Section 15301 (Class 1). A Notice of Exemption will be filed with the Monterey County Clerk's office, pending Board action on this item.

EXHIBITS

10-A Quarterly Water Supply Strategy and Budget: October-December 2006

10-B Quarterly Water Supply Strategy and Budget Report

U:\staff\word\boardpacket\2006\2006boardpackets\20060918\PubHrgs\10\item10.doc

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^[1] Under the 4d rules adopted by the National Marine Fisheries Service on July 10, 2000, the Take Guidance Section, Item E. (page 42472 of the FR Vol. 65, No 132) prohibits removing water or altering streamflow when it significantly impairs spawning, migration, feeding or other essential behavioral patterns.