EXHIBIT 21-D

 

MONTEREY PENINSULA WATER MANAGEMENT DISTRICT

 

FINDINGS of APPROVAL

 

CONSIDER APPLICATION TO AMEND

CALIFORNIA AMERICAN WATER DISTRIBUTION SYSTEM TO SERVE MONTEREY BAY SHORES ECORESORT

Service area: APN 011-501-014

Application #20080915MBS, Permit #M10-07-L4

 

Adopted by MPWMD Board of Directors on July _XX__, 2010

 

Unless noted otherwise, all cited documents and materials are available for review at the MPWMD Office, 5 Harris Court, Building G, Monterey (Ryan Ranch).

 

It is hereby found and determined as follows:

 

1.         FINDING:            Security National Guaranty, Inc., (SNG) is identified as the owner of the subject 39.04-acre parcel in Sand City identified as APN 011-501-014, on which a multi-use resort known as the Monterey Bay Shores Ecoresort (MBSE) is planned.  The proposed water purveyor and co-applicant is California American Water (CAW), a regulated public utility.  The Monterey Peninsula Water Management District (MPWMD or District) previously approved annexation of the subject parcel into the CAW service area as part of approval of the Sand City Desalination Project, but service to the parcel from Entitlements to desalinated water is restricted by MPWMD Ordinance No. 132, which created Rule 23.6.  The City of Sand City approved an earlier (larger) version of the MBSE in December 1998.  SNG holds adjudicated rights, including rights to an Alternative Producer Allocation of water totaling 149 acre-feet per year (AFY) from the Seaside Groundwater Basin as ordered by the Superior Court in the Seaside Basin Adjudication.

                                        

EVIDENCE:         Application #20080915MBS, site map and associated materials submitted September 15, 2008; additional application materials submitted in October 2008.  MPWMD Permit #M07-03-L4 to CAW approved on October 15, 2007.  MPWMD Ordinance No. 132 adopted January 24, 2008.  Notice of Determination for MBSE filed by City of Sand City on December 2, 1998. Seaside Groundwater Basin Adjudication Judgment dated March 27, 2006, as amended, Monterey Superior Court Case #M66343, California American Water vs. City of Seaside et al. (referred to herein as the “Seaside Basin Adjudication Decision”).

 

2.         FINDING:            The 39.04-acre parcel is in the process of being annexed into the CAW service area. Two Advice Letters filed by CAW with the California Public Utilities Commission (CPUC) in 2008 and 2009 were rejected for technical reasons.  In October 2009, CAW submitted a third Advice Letter, but withdrew it in November 2009 due to ongoing litigation.  On July 9, 2010, CAW prepared a new Advice Letter No. 850 to the CPUC to renew its annexation request; CPUC approval is expected shortly.

 

EVIDENCE:         Permit application and other materials specified in Finding #1.  CAW Advise Letter No. 712 to the CPUC and map dated October 23, 2008; CAW Advice Letter No. 724 dated January 26, 2009; CAW Advise Letter No. 806 dated October 30, 2009; CAW letter dated November 24, 2009 withdrawing Advice Letter No. 806; CAW letter to MPWMD dated July 6, 2010 describing annexation history; CAW Advice Letter No. 850 to the CPUC dated July 9, 2010.   

 

3.         FINDING:            No new wells or water supply facilities regulated by MPWMD are associated with this permit application.  The Monterey County Superior Court, Seaside Groundwater Basin Watermaster and Sixth District Court of Appeal have confirmed that an Alternative Production Allocation (APA) of 149 AFY is reserved for use on the subject property, and may be delivered from offsite CAW well(s) located in the Seaside Basin.   

                                        

EVIDENCE:         Permit application and other materials specified in Finding #1.  Seaside Basin Adjudication Decision specified in Finding #1.  Letter from Seaside Basin Watermaster to SNG dated September 19, 2008.  Order After Hearing on SNG’s Motion to Enforce and Clarify the Amended Decision, Case #M66343, filed by the Monterey County Superior Court (Judge Roger Randall) on May 11, 2009 (referred to herein as “Court Order”); Sixth District Court of Appeal Decision, Case #H034335, dated April 1, 2010 (referred to herein as the “Appeal Decision”).

 

4.         FINDING:            The applicants have applied for a permit to amend the CAW Water Distribution System (WDS) to enable CAW to produce (“wheel”) up to 90 AFY of SNG’s water to serve parcel APN 011-501-014 via a “Front-Loading” Water Delivery Agreement. 

 

EVIDENCE:         Permit application materials specified in Finding #1.  MPWMD Permit #M10-07-L4, Conditions of Approval #3 and #4.  Agreement Between Security National Guaranty, Inc. and California American Water Regarding Front-Loading Delivery of Water executed on May 18, 2009 (referred to herein as the “Water Delivery Agreement”).

 

5.         FINDING:            Based on District staff analysis of the application, 90 AFY has been set as the annual CAW production limit from the Seaside Basin to meet the water needs of the parcel specified in Finding #1.  This is equivalent to metered sales of 83.7 AFY, based on an assumed system loss factor (unaccounted for water) of seven percent (7%).  This factor is considered as reasonable in light of the 7% goal set in the MPWMD Rules & Regulations, the CPUC goal of 9% set in July 2009, and other CPUC approvals to replace and repair water mains.

                                        

EVIDENCE:         MPWMD Permit #M10-07-L4, Condition of Approval #3. CPUC Decision 09-07-021 dated July 9, 2009 (issuance date 7/10/2009); MPWMD Rules & Regulations.

 

6.         FINDING:            The application to amend the CAW water distribution system, along with supporting materials, is in accordance with District Rules 21 and 22.

 

EVIDENCE:         Permit application materials specified in Finding #1.  Letter from MPWMD to SNG dated October 31, 2008 re: complete application.

 

Required Findings (MPWMD Rule 22-B)

 

7.         FINDING:            The approval of the permit would not cause unnecessary duplication of potable water service with any existing system.   The proposed system will be limited to one master CAW connection for the resort complex on the subject parcel, and will be guided by a Water Delivery Agreement between SNG and CAW.  It is noted that an onsite well owned by SNG exists on the property, and could be used as a back-up, with proper treatment for potable use.  Two monitoring wells owned by MPWMD also exist on the property. The property benefits from overlying water rights to percolating groundwater.  [Rule 22-B-1]

 

EVIDENCE:         Permit application materials specified in Finding #1. Water Delivery Agreement described in Finding #4. MPWMD Permit #M10-07-L4, Conditions of Approval #1 through #4. 

 

8.         FINDING:            The approval of the permit would not result in water importation or exportation to or from the District, respectively. The referenced property is located wholly within the MPWMD. [Rule 22-B-2]

 

EVIDENCE:         District boundary location maps.  

 

9.         FINDING:            Approval of the application would not result in significant adverse impacts to “Sensitive Environmental Receptors” (SER) as defined by MPWMD Rule 11, including the Seaside Groundwater Basin and the Carmel Valley Alluvial Aquifer (CVAA).  The Monterey County Superior Court has determined the Seaside Basin “natural safe yield” and specified pumping rights of property owners as part of the Seaside Basin Adjudication Decision, including 149 AFY for the applicant.  The Monterey County Superior Court has determined that serving the SNG parcel with CAW wells further inland (rather than onsite wells) is an overall benefit to the ongoing integrity of the Seaside Basin and is part of the Physical Solution. On April 1, 2010, the Court of Appeal confirmed the findings of the Superior Court.  The Water Delivery Agreement is consistent with the May 11, 2009 Court Order finding that with “front-loading,” there is no resultant adverse impacts to the Carmel River or the CVAA.  [Rule 22-B-3]

 

EVIDENCE:         Seaside Basin Adjudication Decision specified in Finding #1. May 11, 2009 Court Order and April 1, 2010 Appeal Decision specified in Finding #3. Water Delivery Agreement specified in Finding #4.

 

10.       FINDING:            The application is based on specified water rights associated with the subject parcel as determined by the Superior Court as part of the Seaside Basin Adjudication.  [Rule 22-B-4]

 

EVIDENCE:         Seaside Basin Adjudication Decision specified in Finding #1. May 11, 2009 Court Order and April 1, 2010 Appeal Decision specified in Finding #3.

 

11.       FINDING:            A long-term reliable source of water supply of 90 AFY of CAW is available to the subject property as this amount is less than the 149 AFY specified under the Seaside Basin Adjudication.    [Rule 22-B-5]

 

EVIDENCE:         Seaside Basin Adjudication Decision specified in Finding #1. May 11, 2009 Court Order and April 1, 2010 Appeal Decision specified in Finding #3. Water Delivery Agreement specified in Finding #4.  Letter from Seaside Basin Watermaster to SNG dated September 19, 2008.

 

12.       FINDING:            The source of water supply is the CAW water distribution system, solely from wells in the Seaside Basin, consistent with the May 2009 Court Order, April 1, 2010 Appeal Decision, and Water Delivery Agreement.  The cumulative effects of issuance of this WDS permit do not result in significant adverse impacts to the source of supply or the species and habitats dependent on the source of supply due to actions by the Superior Court to reduce Seaside Basin pumping to the natural safe yield.  [Rule 22-B-6]

 

EVIDENCE:         MPWMD Permit #M10-07-L4, Condition of Approval #3.  Letter from Craig Anthony, CAW General Manager, dated January 29, 2009.  Letter from James Kassel, State Water Resources Control Board (SWRCB) Assistant Deputy Director for Water Rights, dated February 5, 2009.   Seaside Basin Adjudication Decision specified in Finding #1. May 11, 2009 Court Order and April 1, 2010 Appeal Decision specified in Finding #3.  Water Delivery Agreement specified in Finding #4.

 

13.       FINDING:            The source of supply for the subject parcel is derived from the Paso Robles and Santa Margarita Aquifers in the Seaside Basin, which is not within the jurisdiction of the SWRCB.   The SWRCB has determined that the one-for-one replacement required in its Order WR 95-10 does not apply to the MBSE application so long as CAW supply to the subject parcel is derived solely from the Seaside Basin.  [Rule 22-B-7]

 

EVIDENCE:         MPWMD hydrogeologic maps on file. January 20, 2009 e-mail confirmation of Kenneth Emanuel, SWRCB technical staff member, confirming applicant written summary of October 10, 2008 meeting regarding SWRCB jurisdiction in Seaside Basin.  Letter from Craig Anthony, CAW General Manager, dated January 29, 2009.  Letter from James Kassel, SWRCB Assistant Deputy Director for Water Rights, dated February 5, 2009. 

 

14.       FINDING:            MPWMD Permit #M10-07-L4 does not allow a permanent intertie to any other water distribution system.  The proposed project will be connected to the CAW system, which derives supply from several wells in the Seaside Basin.  Furthermore, there is an existing onsite non-CAW well that can be activated for certain back-up uses, as allowed by the Monterey County Health Department.   [Rule 22-B-8] 

 

EVIDENCE:         Permit application materials specified in Finding #1.  MPWMD Permit #M10-07-L4, Conditions of Approval #3, #4, #13 and #32.  Water Delivery Agreement specified in Finding #4.   

 

15.       FINDING:            A back-flow protection device to prevent contamination of the CAW system is not necessary as CAW is the water purveyor.  CAW may determine that a device is needed if a non-CAW onsite well is activated for back-up use. [Rule 22-B-9]

 

EVIDENCE:         Permit application materials specified in Finding #1.  MPWMD Permit #M10-07-L4, Condition of Approval #14.  

 

Minimum Standards for Granting a Permit (MPWMD Rule 22-C)

 

16.       FINDING:            The application adequately identifies the responsible parties as California American Water and Security National Guaranty, Inc.  [Rule 22-C-1]

 

EVIDENCE:         Permit application materials specified in Finding #1.

 

17.       FINDING:            The application meets the definition of a “multiple-parcel connection system” as water will be provided by CAW, a public utility with nearly 39,000 customers, for commercial, residential and landscape use on the 39.04-acre parcel, and is therefore subject to California Title 22 water quality standards.  [Rule 22-C-2]

 

EVIDENCE:         Permit application specified in Finding #1.  MPWMD Permit #M10-07-L4, Conditions of Approval #1, #2, #3, and #15. California Administrative Code, Title 22.

 

18.       FINDING:            The application identifies the location of the source of supply for the water distribution system as CAW wells in the Seaside Basin.  [Rule 22-C-3]

 

EVIDENCE:         Permit application specified in Finding #1, including engineering maps. Letter from Craig Anthony, CAW General Manager, dated January 29, 2009.  MPWMD Permit #M10-07-L4, Condition of Approval #4.

 

19.       FINDING:            The approval of the application would not create an overdraft or increase an existing overdraft of a groundwater basin, and a superior right has been demonstrated.  The Superior Court has determined the “natural safe yield” and specified pumping rights of property owners as part of the Seaside Basin Adjudication, and has designated 149 AFY for SNG for use on the MBSE parcel identified in Finding #1.   [Rule 22-C-4]

 

EVIDENCE:         Seaside Basin Adjudication Decision specified in Finding #1. May 11, 2010 Court Order and April 1, 2010 Appeal Decision specified in Finding #3.  Water Delivery Agreement specified in Finding #4.  Letter from Seaside Basin Watermaster to SNG dated September 19, 2008.  MPWMD Permit #M10-07-L4, Conditions of Approval #3 and #4.

 

20.       FINDING:            The approval of the application would not adversely affect the ability of existing systems to provide water to users due to conditions of approval that limit future water use to a reasonable and acceptable amount. Overlying water rights holders are also co-equal to other overlying users. [Rule 22-C-5]

 

EVIDENCE:         Seaside Basin Adjudication Decision specified in Finding #1.  Letter from Seaside Basin Watermaster to SNG dated September 19, 2008.  May 11, 2009 Court Order and April 1, 2010 Appeal Decision specified in Finding #3.  MPWMD Permit #M10-07-L4, Condition of Approval #3.  California Water Code.

 

Compliance with California Environmental Quality Act (CEQA)

 

21.       FINDING:            In the 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.  Specifically, the MPWMD, as a Responsible Agency under CEQA for this action, has complied with Guidelines Section 15096, and relies on actions by the CEQA Lead Agency, the City of Sand City and the Monterey County Superior Court.  In December 1998, Sand City certified the Final Environmental Impact Report for the MBSE (SCH#97091005), and adopted a series of resolutions associated with approving the Coastal Development Permit for the project.   In October 2008, a Revised Draft Addendum to the Environmental Impact Report for the Monterey Bay Shores Resort was prepared to describe the revised (smaller) project that is now proposed.  A key change is water service by CAW via SNG’s adjudicated water rights rather than service by onsite wells.  The finalized version, Addendum to the Environmental Impact Report for the Monterey Bay Shores Resort, October 2008, was completed in December 2008 (blue cover) and adopted by the City of Sand City at a public hearing on January 20, 2009.  The Monterey County Superior Court concluded that its Adjudication Order included environmental determinations related to the Seaside Basin and adjudication of the rights therein.  In making its decision on this application, the MPWMD has considered all of the environmental documents and findings made by the Lead Agency.  The MPWMD further has concluded that none of the conditions set forth in CEQA Guidelines 15162 have occurred, and a Subsequent EIR is not required for the MPWMD WDS permit.  The MPWMD action is also consistent with the May 11, 2009 Court Order as confirmed by the Sixth District Court of Appeal, which limits CEQA review of water-related issues to areas other than the Seaside Basin in this matter.

 

EVIDENCE:         Notice of Determination for Monterey Bay Shores Resort Final EIR (SCH#97091005), filed with the County Clerk on December 2, 1998, along with Cal. Dept. of Fish and Game Environmental Filing Fee Cash Receipt #68608.  List of resolutions of approval by Sand City dated December 4, 1998.  Addendum to the Environmental Impact Report for the Monterey Bay Shores Resort, October 2008 prepared for City of Sand City (blue cover transmitted December 2008).   City of Sand City Resolution #SC 09-06 dated January 20, 2009 adopting the Addendum and providing a list of minor errata.  Letter from City of Sand City to Land Watch Monterey County dated February 9, 2009. Seaside Basin Adjudication Decision specified in Finding #1. May 11, 2010 Court Order and April 1, 2010 Appeal decision specified in Finding #3.  Water Delivery Agreement specified in Finding #4.    Findings and Evidence provided in Finding #12 above.  MPWMD Notice of Determination prepared on July XX, 2010 as directed by the MPWMD Board on July XX, 2010 as part of its approval of the subject WDS permit.

 

22.       FINDING:            Pursuant to CEQA Sections 15091 and 15092, the MPWMD Board finds that the project will not have a significant effect on the environment, based on the documentation cited in Finding #21.  Mitigation measures are not made as conditions of approval by MPWMD for this action. The full record for all facets of the project is located in the offices of the City of Sand City, 1 Sylvan Way, Sand City. 

 

EVIDENCE:         Findings and Evidence provided in Finding #21 above. MPWMD Notice of Determination prepared July XX, 2010 as described in Finding #21.

 

23.       FINDING:            Pursuant to CEQA Section 15093, a Statement of Overriding Considerations was not required to be adopted by the MPWMD Board for approval of the subject permit. 

 

EVIDENCE:         Findings and Evidence provided in Finding #21 above. MPWMD Notice of Determination prepared July XX, 2010 as described in Finding #21.    

 

CAW Request for Moratorium on New Connections

 

24.       FINDING:            In May 2010, CAW filed a request to the CPUC for a moratorium on new connections within its Monterey District, with certain defined exceptions, until compliance with the SWRCB Cease and Desist Order has been achieved. The text of the filing is unclear regarding the effect on the MBSE parcel, but CAW representatives have stated the intent was to exclude the MBSE parcel from the moratorium because the Water Delivery Agreement ensures that Carmel River resources would not be affected..  SNG submitted a formal response to the CPUC on July 1, 2010 requesting clarification that all parcels in Sand City are exempt from the moratorium request, if approved.  CAW intends to support the SNG request.  Action by the CPUC is anticipated in late 2010.   

 

EVIDENCE:         SWRCB Order WR 2009-0060 issued October 2009; CAW Amended Application to the California Public Utilities Commission dated May 27, 2010 (Application #10-05-020 filed May 24, 2010); SNG Response to CAW Application #10-05-020 dated July 1, 2010; CAW letter to MPWMD dated July 6, 2010.

 

 

 

 

 

 

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