ITEM:		CONSENT CALENDAR
2.	ADOPTION OF FINDINGS, CONCLUSIONS AND DECISION FOR THE HEARING ON APPARENT INSUFFICIENT PHYSICAL SUPPLIES TO SERVE RYAN RANCH WATER DISTRIBUTION SYSTEM
Meeting Date:			June 15, 2009	Budgeted:	N/A
From:			Darby Fuerst,	Program/	N/A
			General Manager	Line Item No.:
Prepared by:			David Laredo,	Cost Estimate:	N/A
			General Counsel
General Counsel Approval: Yes
Committee Recommendation: N/A
CEQA Compliance: Class 21 Exemption – Enforcement Action, Guideline section 15321

SUMMARY: The Board of Directors for the Monterey Peninsula Water Management District (“District”) previously convened an administrative hearing pursuant to District Rule 40 as to whether the Ryan Ranch Water Distribution System (“WDS” or “System”) has sufficient physical supplies of water to meet demand, and whether modifications to System Capacity and/or Expansion Capacity Limits should be made. That hearing is closed. This matter presents the Findings, Conclusions and Decision of the Board for adoption.

RECOMMENDATION: Approval of the Consent Calendar shall cause the attached Findings, Conclusions and Decision to be adopted. After adoption, a Notice of Decision shall be served upon all Parties. The decision of the Board shall be final.

BACKGROUND: The District previously held an administrative hearing on the sufficiency of Ryan Ranch WDS water supplies pursuant to District Rule 40. Parties to that hearing included the District staff prosecution team, California American Water (Cal-Am), Wilson Street Investors, LLC, Ryan Court Investors, LLC, and Community Hospital of the Monterey Peninsula.

That hearing is closed. The draft Findings, Conclusions and Decision (Exhibit 2-A) have been prepared in accord with direction provided by the Board at its May 20, 2009 meeting.

The draft Findings present the following conclusions:

1. The Ryan Ranch WDS ability to take on new consumers is limited by the amount of its supply. When demand reaches this limit, it has no right to take on new consumers.

2. The District may restrict new connections to the Ryan Ranch WDS to ensure the system does not exceed the existing safe yield of its water supply, and continue the restrictions until the water supply is augmented.

3. Substantial evidence, including credible expert analysis, establishes the physical water supply available to the Ryan Ranch WDS is not sufficient to meet either the permitted system capacity or maximum day conditions.

4. Since the Ryan Ranch WDS wells are no longer capable of producing water at the rates required in the MPWMD permit, or to meet maximum day conditions, the system capacity must be adjusted downward to reflect current production capacity.

5. The system capacity for the Ryan Ranch WDS should be set at 72 acre-feet per year (AFY). This is consistent with the firm well production capacity of 101 gallons per minute (GPM) that is available to that system.

6. The District shall not accept an application for a water permit to expand water use in the Ryan Ranch WDS service area until Cal-Am develops additional well production capacity to sustain a higher system capacity and has its system capacity modified.

7. Upon development of additional well production capacity, or based upon credible expert analysis that the Ryan Ranch WDS can sustain operations in excess of the System Capacity limit set by this order, Cal-Am may apply for amendment of its Ryan Ranch WDS system capacity. The Board shall at that time set an amended system capacity for the Water Distribution System, based upon such credible expert analysis in accord with its Rule 40 B 4.

8. Any decision to create an exception to the Ryan Ranch WDS capacity limits set by this decision for CHOMP or others, similar to the water allocation set by District Ordinance No. 87, is not limited by this decision. Such an exception could result from an exercise of legislative prerogative beyond the scope of this proceeding.

9. The decision of the Board is subject to judicial review within ninety (90) days pursuant to the provisions of the Code of Civil Procedure, section 1094.6, and in accord with District Rule 16.

Based upon the conclusions referenced above, the draft Findings presents the Order:

1. Physical water supplies are not sufficient to support the system capacity for the Ryan Ranch WDS.

2. Modification of the system capacity for the Ryan Ranch WDS is required.

3. The system capacity for the Ryan Ranch WDS shall be 72 AFY.

4. The District shall not accept an application for a water permit to expand water use in the Ryan Ranch WDS service area until its system capacity is further modified.

5. Cal-Am may apply for, and the District may further amend, the Ryan Ranch WDS system capacity based upon credible expert analysis in accord with Rule 40 B 4.

The Findings note that Community Hospital of the Monterey Peninsula (CHOMP) requested that its circumstances require special consideration, perhaps in the nature of a special allocation of WDS system capacity similar to the process enabled by District Ordinance No. 87. While the draft Findings, Conclusions and Decision does not create the exception CHOMP requested to the Ryan Ranch WDS capacity limits, it also does not prohibit future action to create such an allocation. Such an exception can only result from an exercise of the District’s legislative discretion – in the form of enactment of a District ordinance. The Findings determine this result lies beyond the scope of this hearing, but does not prevent future consideration of this request.

The Decision of the Board may be subject to judicial review within ninety (90) days pursuant to the provisions of the Code of Civil Procedure, section 1094.6. (District Rule 16.)

EXHIBIT

2-A Findings, Conclusions and Decision

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