For this evaluation, water importation is defined as obtaining water from entities outside the MPWMD boundary, as opposed to building new water projects (such as dams or desalination projects) within the local area. Water marketing is similar and entails providing opportunities to purchase water (or water rights) from sources either outside or within the local area. The price of water defines water delivery at a specific point. If the water source is distant, both concepts may involve major expenditures to construct and operate facilities such as pipelines, pump stations, storage reservoirs or tanks, treatment plants, and other conveyance and distribution facilities to deliver water to the Cal-Am system. A group of entities can jointly fund an importation project to reduce costs.

MPWMD, other public agencies, Cal-Am, and private entities have evaluated the feasibility and cost-effectiveness of various water importation and marketing projects. Earlier analyses are summarized in the 1994 NLP EIR (MPWMD 1994a); MPWMD worksheets prepared for the February 8, 1996 Alternatives Workshop; and a draft matrix of alternatives prepared for the September 8, 1997 CPUC workshop. Table A-12 provides a summary of information obtained from these and more recent studies.

A.3.6.1 Water Importation and Marketing Concepts


Water sources for importation and marketing that have been explored previously or are suggested for consideration include the following:

  • San Felipe Project (San Luis Reservoir) and other federal and state contractors,
  • Salinas River Basin (including Arroyo Seco River),
  • Big Sur and Little Sur Rivers,
  • Carmel Valley watershed (within and outside the Carmel Valley alluvial aquifer),
  • FORA, and
  • Washington state ("water bags" concept).

The following paragraphs briefly describe each concept and evaluate whether each is a reasonably foreseeable, feasible source of additional lawful water yield for the Cal-Am system. Following this, a more detailed discussion is provided of those concepts considered to be feasible.

San Felipe Project and Other Federal and State Contractors. The San Felipe Project diverts water from the west side of San Luis Reservoir, which stores Northern California water delivered through the federal Central Valley Project (CVP). Presently, the Santa Clara Conduit and Hollister Conduit convey CVP water to the Santa Clara Valley Water District (SCVWD) and San Benito County, respectively. The Pajaro Valley Water Management Agency (PVWMA) has provisional rights to 19,900 af/yr from the CVP but has yet to enter into a formal contract for this water (Yost 1994). Since the passage of the Central Valley Project Improvement Act (CVPIA) in 1992, deliveries of CVP water to contractors south of the Sacramento-San Joaquin River Delta (Delta) have been less than historical deliveries because of increased restrictions on Delta pumping and export to protect fisheries and water quality. Thus, less than 16,000 af/yr of the 19,900-af/yr entitlement would be expected to be received in most years.

Coordination with PVWMA Project. Previous evaluations of the concept of coordinating with PVWMA assumed that water could be purchased during off-peak periods (October–May) and that PVWMA would extend existing pipelines to a terminus in Watsonville. Thus, previous cost estimates addressed only a generic 30- to 40-mile-long pipeline from Watsonville to the Monterey Peninsula (Figure A-5) and a 5,000- to 10,000-af storage reservoir for the off-peak water; pipeline alignments and the reservoir location were not specified. A preliminary estimate of capital costs for the pipeline and reservoir totaled about $94 million in 1988 dollars, which is equivalent to about $130 million in 1998 (escalated at 3% per year). Annual O&M costs were not known.

This alternative was deemed infeasible by MPWMD in its 1988 alternatives evaluation, based on lack of available water and excessive cost. Specifically, a contract for water between MPWMD and the CVP was not possible because all water had been previously contracted for by other agencies in the 1970s, and these agencies (SCVWD and San Benito County) had the right of first refusal for any excess water available from other contractors. In response to inquiries by MPWMD about possible water availability, SCVWD and SBC responded in 1988 that no excess water was available. Even if water were available, the high costs of constructing 30–40 miles of pipeline and build a reservoir to store off-peak water were deemed excessive at that time. Options other than surface storage were not pursued because tests performed in the early 1980s indicated that injecting water into the Seaside Basin was not a viable alternative to a reservoir. As noted previously and discussed below, injection and recovery in the Seaside Coastal Subareas is now considered a potentially viable water storage option, although storage capacity is limited. The complexity of the federal/state permit process involved with the CVP; obtaining rights-of-way outside MPWMD boundaries; and protecting environmental resources that could be affected by the pipeline, conveyance facilities, and reservoir were also identified as concerns.

New information has emerged since MPWMD’s last review in February 1996. The PVWMA completed a comprehensive Basin Management Plan in 1993 (Montgomery Watson 1993), which identified importation of water from the CVP as an integral component. Additional engineering studies completed in 1996 refined the PVWMA base project to include a 60-inch, 23-mile-long pipeline from the Santa Clara Conduit, near Gilroy, to Highway 1, south of Watsonville, with an estimated capital cost of $54.4 million and annual O&M cost of $46,000 per year for the pipeline alone. Also, important new restrictions that affect the reliability of federal water stem from the 1997 Draft Programmatic IS on the CVPIA (cited in Montgomery Watson 1998). Current estimates of the average annual entitlement range from 60% to 75% of the full 19,900-af/yr entitlement, or about 12,000–14,900 af/yr (Montgomery Watson 1998).

In June 1998, voters in the PVWMA passed Measure D, which obligates PVWMA to look for local (in-basin) solutions to the water supply shortage first and cease work on the proposed pipeline for at least 10 years. Thus, a decision by PVWMA on this issue cannot occur until at least 2008. Another consideration is the potential for SCVWD and San Benito County to take delivery of PVWMA’s 19,900-af/yr entitlement if PVWMA fails to act on its contracting opportunity within a reasonable time because these entities have the contractual right of first refusal. Should this occur, capacity for PVWMA or any other user would not be available in the San Felipe Project pipeline because of physical limitations of the pipe itself, and another import supply and conduit would need to be found (or constructed). Given the extremely rapid growth taking place in Silicon Valley and western San Benito County, it is reasonable to assume that these agencies will take delivery of PVWMA’s share if it becomes available within the next 10 years. For these reasons, reliance on imported water from PVWMA is not considered a reasonably foreseeable, feasible alternative that would yield new, lawful supply for the Cal-Am system.

Other Contractors. Based on research conducted by PVWMA (Montgomery Watson 1998, Yost 1994), other CVP contractors could conduct water transfers if capacity were available in the San Felipe Project pipeline. As noted above, capacity would only be available if SCVWD and San Benito County did not take the full 19,900-af/yr entitlement presently slated for PVWMA. Possible water sources investigated by PVWMA include CVP contractors in northern California, in the eastern San Joaquin Valley, and along the Delta Mendota Canal and State Water Project (SWP) contractors such as those in Kern County. Water from any of these sources must be conveyed through federal facilities governed by the restrictions inherent in the CVPIA. As of May 1998, the PVWMA was investigating an option to purchase a CVP contract from the Mercy Springs Water District. With the passage of Measure D in June 1998, however, PVWMA is prohibited from entering into such a contract for 10 years.

Any water transfer scenario involves a complex, multiyear process involving water purchase options, required cofunding of CVP facility operations, water rights issues, environmental concerns, competition with larger agencies such as Metropolitan Water District in southern California, required approval by other water contractors that have rights of first refusal, substantial limitations on water availability imposed by the CVPIA in certain types of water years, and limitations inherent in the physical capacity of the state and federal systems. Experts retained by PVWMA in 1994 estimated that the process to obtain a water contract with the U.S. Bureau of Reclamation would take 8–12 years to complete (Yost 1994).

Potential Costs. If water could be obtained from a source outside MPWMD boundaries, a variety of capital and operating costs would be associated with the process:

  • water purchase (sale price),
  • conveyance through CVP/San Felipe Project pipeline,
  • construction of conveyance facilities to Monterey Peninsula,
  • construction and operation of water storage facilities, and
  • construction and operation of water treatment and distribution facilities (the Cal-Am system).

The price of water would vary based on the delivery option selected. Options include permanent annual purchase of firm supply, as defined by CVPIA restrictions; nominal annual reservation fee, with actual water purchase taking place only during droughts; and water purchase only in normal or wet years, with a means to store water for local use during dry periods. Capitalized water prices in 1994 were $375–1,200 per af (equivalent to $30–200 per af per year). Variations on these three options are possible, including purchase only during off-peak periods (October–May).

Any CVP water user receiving water through San Felipe Project facilities would be assessed a "cost of conveyance" fee, to help pay for construction and operation of the original CVP, and a surcharge to cover construction and operation of the San Felipe Project. For PVWMA, these costs were estimated to be about $124–141/af in 1992 dollars. In addition, an estimated one-time cost of $500,000 would also be required from PVWMA to repay SCVWD and San Benito County a portion of the O&M costs incurred since the project was constructed in 1986. (Yost 1994.)

Major conveyance facilities, such as large pipelines and pump stations, must be built and operated if water is to be conveyed from the Gilroy area to the Monterey Peninsula. As noted above, PVWMA estimated the capital cost of the 23-mile-long Gilroy-to-Watsonville pipeline at $44–54 million (in 1996 dollars), depending on its diameter (48–60 inches); costs would be similar if another alignment were chosen. Another 30–40 miles of pipeline, at an approximate cost of $64 million in 1988 dollars (equivalent to $86 million in 1998 dollars, escalated at 3% per year), would be needed to bring water to the Monterey Peninsula, based on earlier investigations by MPWMD.

Because the least expensive and most viable purchase agreements entail off-peak (winter and spring) delivery of water, some method would be needed to store the water for use during summer and fall or an extended drought. Surface reservoirs, percolation ponds, tanks, or groundwater injection (or some combination of these) would be required to store the water. These facilities are assumed to be located in the Seaside Basin/Fort Ord area or along the Highway 68 corridor to reduce pipeline and pumping costs. In 1988, MPWMD estimated the cost of a 5,000- to 10,000-af surface reservoir at an unspecified location to be $30 million (equivalent to $40 million in 1998, escalated at 3% per year). Injection of imported water into the Seaside Coastal Subareas may be possible, although existing studies indicate that total available storage is limited to about 7,000 af (as discussed in Section A.3.4.2). Identifying a large enough site or sites for storage would be a critical task.

It is important to note that the CVP water considered here is suitable for agricultural use but not for use as drinking water. Construction of fairly large treatment plants would be needed to treat the water sufficiently to meet drinking water standards. As explained in Section A.3.2, major expansion of the Cal-Am distribution system in the Seaside area would be needed to enable Cal-Am to accept substantial quantities of water from the north. Hydraulic studies by Cal-Am indicate that a project that delivers 9,400 af/year (14 MGD) would entail $10–13 million in capital costs for new and upgraded system facilities.

Assuming that purchase of 10,000 af of off-peak water from CVP contractors is feasible, total capital costs (in 1998 dollars) for a pipeline extension from the Gilroy area to the Monterey Peninsula, a storage reservoir, and Cal-Am system improvements would be approximately $180–200 million. Substantial additional costs would also be required to improve the water to drinking water standards. Total annual costs, including purchase of the water, CVP fees, and O&M costs for the project facilities, have not been estimated. This information is summarized in Table A-13.

Entities other than MPWMD and Cal-Am, such as FORA, MCWD, and MCWRA, could share the costs of constructing and operating conveyance facilities (e.g., pipeline and pump stations) based on the proportional share of water received by each. Each of these agencies has a need for water and has developed a variety of plans to obtain it. No discussions have occurred to date among these agencies regarding cost sharing, but circumstances do not preclude such a discussion in the future. Evaluating the myriad combinations and permutations of cofunding arrangements that could be arranged is beyond the scope of this analysis.

In summary, the ability to purchase water from CVP contractors depends greatly on future actions by PVWMA, SCVWD, and San Benito County. If the latter two agencies contract for PVWMA’s entitlement as a result of restrictions imposed on PVWMA under Measure D, no physical capacity would be available in existing conduits to serve new users. Given the high costs of building a new conduit from Pacheco Pass and the conveyance, storage, treatment, and distribution facilities described above, importing and marketing water from the CVP would not be considered a reasonably foreseeable, feasible project. Even if SCVWD and San Benito County did not take PVWMA’s entitlement, the 8- to 12-year process required to obtain a CVP contract and the extremely high capital costs involved render the feasibility of this alternative questionable. Cost sharing by cooperating agencies is one means to address the cost concern but would reduce the portion of the overall yield available to water users in the Monterey Peninsula. Discussions on cost sharing for imported water have not been initiated by any party, and no plans are under way to initiate such discussions in the foreseeable future. Thus, even if water were available in theory, the viability of this alternative is questionable.

Salinas River Basin. A more locally based importation concept involves the Salinas River and its tributaries, particularly the Arroyo Seco River (Figure A-5). Use of the Salinas River directly would entail water releases from Nacimiento and San Antonio Dams, which would travel to wellfields near either Spreckles or Chualar, where groundwater would be pumped and conveyed to the Monterey Peninsula by pipeline. This alternative was dismissed by MPWMD in 1988 because a similar project was proposed by Monterey County to address its chronic seawater intrusion problem. Notably, Monterey County policy prohibits out-of-basin transfers, especially in light of the significant water quality and quantity issues facing the Salinas Basin.

In recent years, lawsuits have been filed by parties in southern Monterey County and San Luis Obispo County regarding rights to water from the two existing dams. Since 1992, the MCWRA has evaluated and pursued several projects under its Basin Management Plan (BMP). The MCWRA, in conjunction with the MRWPCA, constructed a large wastewater reclamation project to provide recycled wastewater for agricultural irrigation in coastal areas near Castroville. This project, known as the Monterey County Water Recycling Projects (MCWRP), began water deliveries in April 1998. Several of the projects evaluated under the BMP are included in the Salinas Valley Water Project (SVWP). A Draft Master EIR on the SVWP was released in October 1998 (EDAW 1998). Components of the SVWP include "reoperation " of Nacimiento and San Antonio Reservoirs to increase the amount of water available for groundwater recharge and diversion downstream; additional diversion, storage, and reuse of Salinas River water; and storage of recycled water from the MCWRP during low-demand periods for use during the irrigation season. None of the projects currently being evaluated would provide water service to the Monterey Peninsula.

Monterey County has considered construction of a new dam and reservoir on the Arroyo Seco River, a tributary to the Salinas River, since the early 1980s. Preliminary designs included a 100,000-af dam and a 56-mile lined canal to convey water to the Salinas area, at which point pipelines could emanate to convey water to areas such as the Monterey Peninsula, Fort Ord, and Marina. Capital costs were estimated to be $79.5 million (1988 dollars) for the dam and lined canal, which is equivalent to about $107 million in 1998 dollars (escalated at 3% per year). Costs of an approximately 15-mile pipeline from Salinas to the Monterey Peninsula (which were not developed in 1988) would be about $20 million, based on recent cost estimates for the PVWMA importation project pipeline. Significant additional costs would be required to treat water to a level that would meet drinking water standards and for integration into the Cal-Am distribution system.

The Monterey County Board of Supervisors voted not to proceed after analyzing the Arroyo Seco project in 1983, and the project was dismissed again in 1991 in favor of other BMP projects. This alternative was dismissed by MPWMD in 1988 because the cost of construction would be too high to carry out without joint funding by Monterey County. Other ongoing concerns include the uncertain water rights situation, the current Monterey County policy prohibiting out-of-basin transfers, consistent public controversy over damming a wild river known for its recreational opportunities, impacts on fishery and wildlife habitat (which support species now listed as threatened), and dislocation of property owners. For these reasons, reliance on imported water from the Salinas River and its tributaries is not considered a reasonably foreseeable, feasible alternative that would yield a new, lawful supply for the Cal-Am system.

Big Sur and Little Sur Rivers. A portion of winter stormflow from the Big Sur or Little Sur River could be captured and conveyed to the Monterey Peninsula, possibly through the Carmel River (Figure A-5). Facilities would include a dam, reservoir, and pipelines from the Big Sur or Little Sur River to Monterey Peninsula, as well as other conveyance and storage facilities. An estimate of costs associated with specific pipeline alignments and reservoir locations was never developed, but costs were expected to be very high because of the rugged terrain and the distances involved. This alternative was dismissed by MPWMD in 1988 based on environmental, regulatory, and cost concerns. These concerns included impacts on a large portion of the Ventana Wilderness, protected wild rivers, and biological and cultural resources, as well as the low likelihood of federal approval given that other options for water supply exist. Importation of water from the Big Sur and Little Sur Rivers is not reasonably foreseeable given Monterey County’s policy prohibiting transfer of water between watersheds, in addition to the concerns described above.

Carmel Valley Watershed. Purchase of water and/or water rights from property owners in Carmel Valley (both in and outside of the Cal-Am service area) has been suggested as a means to help legalize Cal-Am’s supply. The two basic sources of water, those outside the alluvial aquifer and those within the alluvial aquifer, are distinguished as follows:

  • Outside alluvial aquifer: These sources are upland areas outside the jurisdiction of the SWRCB that could offset existing Cal-Am use on a one-for-one basis in compliance with SWRCB Order WR 95-10 (SWRCB approval for the offset is assumed). Production sources are typically deep wells in fractured bedrock, characterized by low production potential per well (most less than 20 gallons per minute). Dozens of wells would be needed to reliably produce more than 500 af of water annually.
  • Within alluvial aquifer: These sources are areas within SWRCB jurisdiction, many of which are identified as water rights applicants in Table 13 of SWRCB Decision 1632. All applicants must complete rigorous, multiyear environmental review and hearing processes to establish legal appropriative rights to water use, as identified in Table 13, before any sale to Cal-Am could be contemplated. Endangered Species Act issues could also result in limits on water extraction in the alluvial area. Production sources would be wells in the alluvial aquifer, which are characterized by relatively high production potential (as much as 2,000 gallons per minute for large municipal wells).

Three elements are needed for water marketing to occur: an adequate supply of water at reasonable cost, a willing seller, and the legal authority to sell the water. These elements are discussed below. In the case of Carmel Valley, significant new Cal-Am facilities would not be needed to receive water delivered to sites within or near the existing Cal-Am distribution system. Modification or expansion of treatment facilities may be needed if water quantities would be significant.

Rancho San Carlos. Purchase of water from Rancho San Carlos, a 20,000-acre property southwest of the Carmel River that is slated for low-density development, has been suggested as a means to obtain water for Cal-Am and, at the same time, preserve the property as a regional park. In support of development plans for Rancho San Carlos, extensive hydrologic and other environmental studies were performed through 1995. These studies demonstrated that 400 af/yr could be reliably extracted from 20,000 acres of upland (nonalluvial) fractured bedrock to serve the proposed uses without significant impact, but that 95–139 wells may need to be operated to extract this amount because of the low production capability of the fractured bedrock (Monterey County 1995). No specific cost estimate for delivery of the 400 af/yr was provided in the hydrologic evaluations, but this would be in addition to the estimated $15,000 per af in capital costs that would be required for well completion.

Hydrologic studies indicated that a maximum of 3,100 af/yr from fractured granite might be available for consumption if it could be reliably extracted (which was not demonstrated); this level of extraction would result in environmental impacts far more severe than those analyzed in the Rancho San Carlos EIR. Assuming that the entire 3,100 af/yr could be extracted, and based on cost information developed by the Rancho San Carlos Partnership (Wilcoxon pers. comm.), an estimated $46.5 million would be needed for well drilling alone (930 wells at $50,000 each). An additional $46 million would be needed for the extensive infrastructure to supply electrical power to the well network and a collection system of water mains to consolidate and deliver the water. Thus, nearly $93 million in capital costs would be needed to obtain 3,100 af/yr. Annual costs were not provided. These costs do not include the sale price of the water or access rights by the Rancho San Carlos Partnership. The environmental impacts of drilling more than 900 wells and the extensive infrastructure associated with power facilities (e.g., overhead or underground power lines) and water conveyance (e.g., maintenance roads, pipelines, and pump stations) to convey water from disaggregated well sites are expected to be adverse and significant.

A second source of water from Rancho San Carlos might be found within the alluvial aquifer if water rights approvals from the SWRCB were obtained. The Rancho San Carlos Partnership has applied for a 268-af/yr appropriation, as shown in SWRCB Decision 1632, Table 13. Costs to pump this water from an alluvial well would be minimal.

In response to inquiries by MPWMD in October 1997 about the possible sale of water, the Rancho San Carlos Partnership responded in November 1997 that it "does not plan to offer its water resources for sale" because such a sale does not meet the partnership’s business objectives; also, conditions of the approved vesting tentative map preclude the development and/or connection of the Rancho San Carlos water system to any other supplier (Wilcoxon pers. comm.). In summary, the existence of a reliable supply greater than 400 af/yr is unproven, the cost would be high, environmental damage would result from construction of the infrastructure network, the proposed seller is unwilling, and regulatory prohibitions would need to be overcome. Therefore, sale of Rancho San Carlos water is not considered a reasonably foreseeable, feasible alternative to provide a new, lawful supply for the Cal-Am system.

Other Properties. MPWMD is aware of no local property owner with established water rights acknowledged by the SWRCB who has expressed an interest in marketing water to Cal-Am or MPWMD. Most property owners use their supply sources to maintain existing uses or plan to serve specific planned development projects. In previous years, the MPWMD Board of Directors has approved short-term arrangements in which property owners "convert" their non-Cal-Am water use (along with a permanent conservation savings requirement) into Cal-Am service to a property; no money is involved in the conversion, and the net water use from the Carmel River Basin is reduced. In general, the water production in upland areas is limited by low productivity of wells in those areas, whereas property owners in alluvial areas must first establish water rights for existing use in accordance with SWRCB procedures (Anton pers. comm.). For these reasons, water marketing from other properties in Carmel Valley is not considered a reasonably foreseeable, feasible alternative to provide a new, lawful supply for the Cal-Am system.

Fort Ord Reuse Authority. Purchase of water from FORA has been suggested as another marketing option. The reuse authority has a 6,600-af allocation from Monterey County to serve the homes, businesses, and institutions proposed for development in the Fort Ord Reuse Plan, adopted in June 1997 (Fort Ord Reuse Authority 1997). Full implementation of the plan would require acquisition of additional water from other sources. In response to inquiries by MPWMD in September 1997 about the possible sale of water, FORA responded that the reuse plan is "fully reliant upon the entire 6,600 af" and that previous actions in 1996 had allocated water resources to water users as enumerated in an agreement with federal and county authorities. The letter concluded that it is "not reasonable to expect that any portion of the 6,600 af will be available for use outside the boundaries of the former Fort Ord". (Jordan pers. comm.) Because Cal-Am and MPWMD have no right or claim to this water, this option is not considered a reasonably foreseeable, feasible alternative to provide a new, lawful supply for the Cal-Am system.

Washington State ("Water Bags" Concept). Inventor Terry T. Spragg has proposed that water could be transported from areas where it is inexpensive and plentiful to water-impoverished areas by means of ocean-going "trains" of 500-foot-long, 4.5-million-gallon, rubber water bags connected by huge zippers and towed by tugboats. The concept has received international attention as a possible means of easing tensions relating to water supply in the Middle East. On the West Coast, Mr. Spragg has actively communicated with entities such as MPWMD and Metropolitan Water District as possible contractors for water. The source of water has been described as certain rivers in Washington’s Olympic Peninsula for which Spragg has applied for water rights. Spragg has described the purchase price of the water as being in the range of $600–1,000 per af, but this has not been confirmed. To receive the water locally, a water delivery system would need to be constructed, including an ocean pipeline and off-loading facility to remove water from the bags; a system to handle and transport empty bags back to Washington; mooring and bag-handling facilities near the off-loading facility; and shore-based facilities such as water treatment plants, booster-pump stations, and pipelines to municipal reservoirs or other storage facilities (CH2M Hill 1996b). No costs have been developed for construction and operation of the off-loading and bag-handling facilities, but they are expected to be millions of dollars. Several more millions of dollars’ worth of Cal-Am capital facilities would be needed to treat the imported water to meet drinking water standards and integrate the water into the Cal-Am distribution system. Actual costs would depend on the quantities delivered. The cost of mitigation measures must also be considered.

To date, MPWMD has declined to enter into a contract with Mr. Spragg because this concept is still in the R&D phase and has not been shown to be a viable alternative for technical and regulatory reasons. A videotape shown by Mr. Spragg at the January 23, 1997 MPWMD Board of Directors meeting described a 100-mile-long ocean test of two 770,000-gallon bags in Puget Sound, where one of the bags failed. No subsequent test demonstrating the bags’ seaworthiness has been performed. (Successful tests of similar concepts have been conducted by European companies in the Mediterranean Sea.) MPWMD consultation with regulatory agencies in Washington also indicated that Native American groups had protested Spragg’s application to use water from rivers on the Olympic Peninsula and that water rights for Mr. Spragg’s proposal are questionable. Locally, NOAA officials for the Monterey Bay National Marine Sanctuary indicated that no categorical prohibitions would prevent such a project, but a complete project description, environmental analysis, and consideration of alternative off-loading strategies would be needed before NOAA could provide an opinion on the project in light of regulations that protect the seabed (Jackson pers. comm.). Until the technical and regulatory feasibility of the water bag concept is demonstrated, this alternative is not considered a reasonably foreseeable, feasible means to provide lawful water yield to the Cal-Am system.


Based on SWRCB Order WR 95-10 and Decision 1632, several legal, regulatory, and other actions have been suggested as means to help legalize Cal-Am’s existing supply and encourage permanent water conservation without requiring construction of expensive capital facilities. Some of these concepts were previously reviewed in MPWMD worksheets prepared for the February 8, 1996 alternatives workshop and a draft matrix of alternatives prepared for the September 8, 1997 CPUC workshop. Table A-14 provides a summary of these water supply alternatives based on previously acquired and current information.

Four main concepts have been proposed that involve legal, regulatory, and other actions:

  • obtain additional water rights from SWRCB,
  • change the relationship between land use and water availability,
  • reduce impacts on the Carmel River environment, and
  • no action (permanently reduce the legal supply).

A.3.7.1 Obtain Additional Water Rights from SWRCB


SWRCB Order WR 95-10 determined that Cal-Am’s existing water rights total 3,376 af/yr, comprising 1,137 af/yr of pre-1914 appropriative rights, 60 af/yr of riparian rights, and 2,179 af/yr of appropriative rights. (These figures were based on existing storage at Los Padres Reservoir; technically, the 2,179 af of appropriative rights can be used only in Carmel Valley.) Based on historical water production, Order WR 95-10 estimated that 10,730 af/yr of water is being unlawfully diverted by Cal-Am, and ordered Cal-Am to legalize its supply. As an interim measure, a production goal of 11,285 af/yr was set for Cal-Am diversions from the Carmel River Basin beginning in water year 1997. As described in previous sections of this appendix, various projects and actions have been explored to develop replacement water for the unlawful 10,730 af/yr or to permanently reduce demand as a means of decreasing the 10,730 af/yr diversion. Another possibility is to obtain additional water rights from the SWRCB through additional regulatory and legal processes. Four water supply alternative concepts have been discussed:

  • obtain new or expanded water rights in accordance with Table 13 of SWRCB Decision 1632,
  • obtain additional water rights over and above those already recognized,
  • assert additional water rights under a "pueblo water right" claim (explained below), or
  • request and obtain modification or elimination of the current water use restrictions imposed by the SWRCB.

Obtain Water Rights in Accordance with SWRCB Decision 1632. Table 13 in SWRCB Decision 1632 lists water rights applicants who divert (or plan to divert) water for in-basin use within the Carmel River. The decision established that water rights that may be obtained in the future (under the applications listed in Table 13) are afforded a higher priority than the rights already approved for MPWMD’s dam application and identified quantities of water that are reserved for those applicants for future appropriation, assuming the CRDRP is constructed. One exception is Cal-Am’s water rights application, which will not be given priority "to the extent that [Cal-Am] is diverting and supplying water for use outside the Carmel Valley watershed". Cal-Am’s water rights request in Table 13 is for 33,153 af/yr of combined storage and diversion. The amount reserved for future appropriation by Cal-Am in Table 13 is 2,964 af/yr, and this amount can only be appropriated for in-basin use. A general estimate of Cal-Am’s deliveries within the hydrologically defined watershed (i.e., Carmel Valley) is about 1,000 af/yr; this amount must be confirmed by an examination of Cal-Am’s metered sales in Carmel Valley.

In July 1998, the SWRCB explained the environmental and water rights processes that must be completed before a decision can be made on the pending water rights applications, including that of Cal-Am (Anton pers. comm.). First, a comprehensive EIR must be prepared by the SWRCB (and paid for by the applicants) that includes an analysis of the cumulative effects of the applications to Carmel River on species listed as threatened under the Endangered Species Act. Second, the formal water rights protest and hearing process must take place. If the CRDRP is not constructed, "there may be less water available for appropriation [than is listed in Table 13] because the storage and subsequent release of water [from the dam] would have provided both instream and out-of-stream needs within the watershed". Applicants have an "obligation to develop information sufficient for the SWRCB to conclude that an adequate supply of water is available for existing watershed needs and the applicants projects". (Anton pers. comm.)

The processes required before an SWRCB decision can be made will take at least 2–4 years to complete, and it is unknown when these processes will begin. The outcome of the EIR and water rights hearings cannot be predicted at this time, and no outcome can be predicted as being reasonably foreseeable. Thus, the computer modeling evaluations in Section A.4 presently rely only on currently known water rights.

Obtain New Water Rights over and above Recognized Rights. In September 1997, the SWRCB discussed the concept of granting Cal-Am the right to divert 8,000 af/yr from the Carmel River throughout the year (Pettit pers. comm.). The SWRCB emphasized the importance of the Decision 1632 findings that no new, unappropriated water is available in the summer season and that any new water rights application can be approved only if the diversion season extends from January 1 through April 30. Furthermore, "only 4,161 [af/yr] would be available for continuous year-round diversion by Cal-Am" whether Cal-Am depends on MPWMD’s permit for the new dam or obtains its own permit (Pettit pers. comm.). (In case MPWMD does not transfer or license its permit for the dam, Cal-Am has already applied for separate rights associated with a new dam.) Of the available 4,161 af/yr, 1,197 af/yr is already included in Cal-Am’s existing, recognized right of 3,376 af/yr described above. The remaining 2,964 af/yr refers to the reserved amount identified in Table 13 and discussed above. Thus, the possibility of obtaining additional Cal-Am water rights above the Table 13 amount is not reasonably foreseeable.

In February 1998, Cal-Am applied for rights to divert a maximum of 3,900 af/yr in winter (December 1–March 31) for community use, "when and only when there are excess flows running to the Pacific Ocean" in December–March. The determination of "excess flows" is assumed to be similar to the bypass requirements included in Decision 1632, which are designed to protect the steelhead resource. Excess flows could range from zero in a drought year to thousands of acre-feet in a wet year such as 1998. The stated purpose of Cal-Am’s application is to supplement previous water rights applications and, in the near term, to permit total diversions in excess of the interim goal of 11,285 af/yr from the river basin. As of September 1998, the SWRCB had not published a notice for a public hearing on this application, and the timing of the board’s consideration is unknown.

MPWMD has informed the SWRCB that MPWMD plans to apply for a permanent water rights permit to divert these same excess winter flows as part of the Seaside Basin injection/recovery program described in Section A.3.4. MPWMD has already obtained a temporary SWRCB permit to use excess winter flow to facilitate testing of the injection pilot project in early 1998 and has submitted a second application to continue testing in early 1999. The Cal-Am application could conflict with MPWMD’s injection project unless a cooperative assignment of rights is made, which is reasonably foreseeable. However, Cal-Am’s winter water right would not be in addition to the yield from the injection project because the same water would be used for both purposes.

Assert Pueblo Water Rights. A pueblo water right is the highest priority water right of a California city to use all the water that flowed naturally through an original Mexican or Spanish pueblo, if three prerequisites are satisfied:

  • the city must be the successor in interest to a former pueblo,
  • the city must have presented a specific claim to the appropriate land commission no later than March 1853, and
  • the city must show that it has a need for water.

The determination of a pueblo water right and the extent of those rights can only be confirmed by the courts. To date, only the cities of Los Angeles and San Diego have perfected water rights under a pueblo right.

The SWRCB has rejected the suggestion that the City of Carmel meets the criteria for pueblo water rights and has asserted that "no pueblo right existed for Carmel for water from any source" (Anton pers. comm.). The SWRCB has responded to a suggestion that the City of Monterey may have pueblo rights to the Carmel River. In April 1998, the SWRCB concluded that "it does appear that there is evidence to support a pueblo right for the City. However, the pueblo right would not include the right to divert and use the water of the Carmel River or the Carmel Valley subterranean stream because neither source is located within the boundaries of the pueblo" (Anton pers. comm.). Documents submitted by the City of Monterey more than a century ago indicate that the Salinas River may be included in the original pueblo boundaries.

It would be the responsibility of the City of Monterey to pursue any pueblo right in the courts and to comply with the criteria necessary for a modern city to obtain water through a pueblo right. For example, the pueblo right can only be used by a city-owned municipal water company, and the water gained can only be delivered within existing city boundaries. In theory, the City of Monterey could create and operate a municipal water company separate from Cal-Am and seek access in the courts to water from the Salinas Basin to meet its needs. Informal discussions with city staff indicate that such action is unlikely because of the costs and uncertainties involved, particularly given existing water rights issues in the Salinas Basin. In the unlikely event that the City of Monterey successfully asserts a pueblo water right, that action would not provide additional legal rights for Cal-Am or provide valid water rights to serve the remaining five cities and unincorporated county areas that depend on Cal-Am water. If exercised, however, the City of Monterey’s right would reduce water demand on the Cal-Am system by the amount used by the City of Monterey (presently about 4,400 af/yr).

For these reasons, reliance on pueblo water rights is not a reasonably foreseeable, feasible means to provide a lawful water supply for the Cal-Am system.

Request Changes to Current Restrictions Imposed by SWRCB. Current water use restrictions imposed by the SWRCB could be modified or eliminated. Such changes could be arrived at through persuasion, negotiation, or litigation. For example, litigation filed by various parties against SWRCB Order WR 95-10 and Decision 1632 was settled in February 1998 and resulted in refinements to the order and decision in SWRCB Order WR 98-04. These refinements did not change the basic conclusions about Cal-Am’s water rights. In August 1998, the SWRCB rejected a petition for statutory adjudication of water rights of the Carmel and Salinas Rivers and noted that previous SWRCB determinations about the Carmel River subterranean stream and the lack of prescriptive water rights by Cal-Am were final and are no longer subject to legal challenge (Schueller pers. comm.).

In July 1998, MPWMD filed suit alleging arbitrary and capricious enforcement of Order WR 95-10 by the SWRCB because the interim production goal of 11,285 af/yr is not consistent with the stated intent of Order 95-10 to "honor existing commitments (allocations)" by MPWMD. (The MPWMD suit does not challenge the order itself, only the implementation of it.) This case is pending and the results cannot be predicted at present. Any resolution of this case pertains to near-term, interim water use only and does not address long-term water rights. For these reasons, substantive changes to previously issued SWRCB determinations are not reasonably foreseeable.

A.3.7.2 Change the Relationship between Land Use and Water Availability

Philosophical changes could result in local regulatory changes that affect the relationship between land use and water availability. Several examples of such changes are identified below.

Coordinate Land Use Plans and Water Supply. Currently, each jurisdiction develops a general plan that reflect the community’s vision of the future, based on social, economic, environmental, and other factors. Typically, infrastructure providers such as MPWMD, Cal-Am, and other utility services perceive their mission as providing adequate water and other services to meet the future needs of the community represented in the general plan. An alternative concept encourages a change in philosophy toward "living within our means". The concept assumes that each jurisdiction would revise its general plan to reflect the existing and reasonably foreseeable new water supply and would consider restraining growth potential under the existing circumstances. This type of action could result in reduced water demand in the future but does not address existing Cal-Am consumption. The concept also raises important legal issues regarding "taking" of property that was previously zoned for specific uses that may not be available if general plans are revised substantially. The suggested coordination is laudable from a planning perspective but is not a reasonably foreseeable means to provide a lawful supply for the Cal-Am system.

Restrict Certain Land Uses. A stricter variation on the previous theme is outright prohibition or restriction of certain land uses to reduce future water use. Examples suggested at public forums include prohibiting construction of new golf courses, hotels, and restaurants and reducing existing hotel rooms and restaurant seating by a certain percentage for businesses over a certain size. This concept is not consistent with MPWMD’s longstanding policy of not interfering in the land use plans of jurisdictions within the district, when these plans are adopted in compliance with CEQA. Each jurisdiction manages the water allocated to it by MPWMD. The jurisdiction is responsible for determining which projects will be permitted, in compliance with its zoning codes and other regulations.

Such a focused restriction on a particular type of land use would raise legal issues of discrimination against the hospitality industry, which is the primary force of the local economy. It is questionable whether MPWMD or any other public entity has the authority to take such action. From a practical perspective, the concept has flaws regarding expected savings. For example, if construction of new golf courses were prohibited, the jurisdictions could designate the water "saved" for another similar use, such as a park. If addition of restaurant seats or hotel rooms were limited, visitors would patronize alternate venues when the most popular venues were full. (This situation would probably occur only on the busiest holiday weekends.) Golf courses account for about 6% of Cal-Am water consumption, and the hospitality industry (hotels and restaurants) accounts for about 7% of Cal-Am water deliveries. Golf courses and most new hospitality-oriented developments that are planned or are currently under construction rely on reclaimed water or independent water rights and delivery systems outside the Cal-Am service area. Thus, the suggested restrictions on new construction would have little impact on future Cal-Am water use. For these reasons, this concept is not a reasonably foreseeable means to provide a lawful supply for the Cal-Am system.

Change MPWMD Water Allocation Program. Reducing the Cal-Am production limit (17,641 af/yr) set by the MPWMD Water Allocation Program to a lower amount (15,285 af/yr) has been suggested as a means to achieve consistency between the 11,285-af/yr interim diversion goals for the Carmel River Basin, specified in the SWRCB order, and existing community water use. (The 15,285-af/yr amount reflects the Carmel River diversion goal of 11,285-af/yr plus the 4,000-af/yr average limit set by MPWMD for Cal-Am extractions from the Seaside Basin.) As noted above, the MPWMD has filed litigation against the SWRCB to achieve consistency by the SWRCB by increasing the interim Cal-Am diversion goal to an amount greater than 11,285 af/yr. Until that lawsuit is resolved, no change in MPWMD policy is anticipated. The 1990 Water Allocation Program EIR would need to be updated and recertified before any substantive change could be made in the program.

Changing the MPWMD Water Allocation Program to include a revised Cal-Am production limit of 15,285 af/yr would address only the SWRCB interim diversion goal. It would not address the long-term need to legalize 10,730 af/yr of Cal-Am production, as cited in Order WR 95-10. To address this need, the MPWMD Water Allocation Program would need to reduce the Cal-Am production limit by about 10,000 af/yr, to a new limit of about 7,400 af/yr, based on existing Cal-Am water rights and production potential from the Seaside Basin. Such a substantial reduction (nearly 60%) in existing community use is not considered reasonable or achievable given the adverse public health, safety, and economic ramifications.

Complicating the matter is the fact that nearly all of the most recent 358-af/yr water allocation, derived from the Paralta well in 1993, has been distributed in the intervening 5 years. Only 20–50 af/yr of the original 358 af/yr is estimated to remain for use by new construction and remodels. Community water use from Cal-Am production in 1997 was more than 17,100 af, which is approaching the 17,641-af/yr allocation program limit; an additional concern is the fact that these data do not include water use anticipated from projects approved in the past year that are presently under construction. In this context, discussing a change to reduce the Water Allocation Program limit may be irrelevant.

Setting a new Cal-Am production limit below the level of current community water use could be construed as implementing de facto mandatory rationing and a moratorium. Such an action could not be taken without completing the public review processes required by CEQA and the MPWMD laws. The MPWMD Board of Directors presently opposes any moratorium on new connections because of the small savings involved and because such a policy would penalize jurisdictions that have made careful use of their 1993 allotment, rather than using it up quickly. The board presently opposes mandatory rationing unless such action is needed in a water supply emergency. CPUC Decision 98-08-036 recommended that MPWMD and Cal-Am work to amend the Water Allocation Program to address public concerns about new construction in light of SWRCB Order WR 95-10 while considering the rights of existing legal lots of record. Cal-Am and MPWMD are jointly developing standby rationing plans that would be available to address interim production goals set by Order WR 95-10 and could be used in a physical drought emergency. If the position of the MPWMD Board of Directors changes, a limited reduction in the Cal-Am production limit could be achieved through various conservation measures, as described in Section A.3.5.

Based on these considerations, altering the MPWMD Water Allocation Program alone is not a reasonably foreseeable means to provide a lawful supply for the Cal-Am system. Similar results could be achieved through viable conservation efforts. However, a change in the allocation program, even if symbolic, could serve as a catalyst to reduce community water use to a limited extent. In turn, a permanent reduction in community water use would result in a smaller quantity of water that other projects would be required to generate to legalize the Cal-Am supply.

A.3.7.3 Reduce Impacts on the Carmel River Environment


Most attention on SWRCB Order WR 95-10 has focused on elements relating to legalizing the Cal-Am diversions from the river basin. Another important aspect of the order is the finding that existing community water use, even if lawfully diverted, has an adverse impact on the public trust (environmental) resources of the Carmel River. Because the SWRCB’s mandate includes protection of these resources, the SWRCB can order reductions in lawful water diversions to protect the environment. Thus, efforts to reduce diversion impacts on the Carmel River have value even if they do not legalize Cal-Am production. Suggested efforts to reduce diversion impacts are described below.

Refine the Cal-Am Water Delivery System. SWRCB Order WR 95-10 (as amended by Order WR 98-04) includes the following actions by which Cal-Am could reduce impacts of its water diversions on the Carmel River:

  • maximize extractions from the Seaside Basin (to the extent feasible within limits set by MPWMD to protect the basin) during periods of low flow in the Carmel River, and minimize Seaside Basin extractions when riverflow exceeds 40 cfs;
  • maximize water diversions from wells in the Lower Carmel Valley to the extent feasible (without resulting in adverse effects on the environment or other wells);
  • conduct feasibility and cost studies by February 1999 to determine whether alternative configurations of existing water treatment plants and production wells could be used to serve water customers while allowing more water to flow downstream for a longer distance than is allowed at present, and implement changes as deemed feasible by the SWRCB as a result of those studies;
  • evaluate the feasibility of bypassing early storm runoff to recharge the subterranean stream rather than immediately storing it in the reservoirs; and
  • assess the feasibility and costs of modifying critical stream reaches to ensure easier passage of steelhead.

The first two conditions have been implemented by Cal-Am as part of MPWMD’s quarterly water supply strategy in consultation with the California Department of Fish and Game. The feasibility studies are in the planning stages. In addition to the conditions noted above, Cal-Am also plans to explore the feasibility of drilling one or more new wells in the Lower Carmel Valley on donated property that is farther downstream than any other Cal-Am well. Cal-Am emphasizes that the new well would not be a source of new, lawfully diverted water; it would replace diversions from upstream wells to enable the river to flow farther downstream before being dewatered. Given proposed location of the new well near the Carmel River Lagoon, operation of the well would need to be designed and managed carefully to avoid dewatering of the lagoon or increasing the potential for seawater intrusion.

In summary, certain refinements to the Cal-Am system have already taken place since 1995. The feasibility of other refinements, and the degree to which they can result in environmental improvements, will be assessed by studies scheduled to begin in 1999.

Encourage Watershed Protection and Management. Cooperation among agencies, private property owners, academic institutions, and the public could be encouraged and continued, leading toward comprehensive stewardship of watersheds on the Monterey Peninsula. A comprehensive approach would be needed because many activities outside the Cal-Am and MPWMD boundaries (such as grazing, agricultural practices, and road building) can have significant effects on Carmel River habitats and the community water supply. An important step toward ensuring cooperative action should occur in the next 1–2 years as a result of the Endangered Species Act. MPWMD has volunteered to serve as the lead entity to facilitate preparation of a habitat conservation plan for at least the Cal-Am service area, and potentially encompassing a broader area of the watershed, in compliance with Section 10 of the Endangered Species Act. Initial contacts with Carmel Valley golf courses and other landowners indicated a desire to develop a proactive, cooperative strategy to meet community needs and protect threatened species. The specific results of this action cannot be predicted, but it is reasonably foreseeable that some benefit will occur.

A.3.7.4 No Action (Permanently Reduce Legal Supply)

The No-Action Alternative would involve MPWMD ceasing its efforts to obtain a long-term, lawful supply for the Cal-Am system or permanent reductions in community demand. Based on Condition 14 of SWRCB Order WR 95-10 and on various letters and public statements by the SWRCB, it is reasonable to assume that such inaction would lead to full enforcement of Order WR 95-10 as written. This would mean that Cal-Am would be allowed to extract only 3,376 af/yr (its recognized right) from the Carmel River and that the interim diversion goal of 11,285 af/yr would be terminated. Assuming that as much as about 4,000 af/yr can be taken from the Seaside Basin, this would mean that a total of about 7,400 af/yr would be available to serve the community. This amount is about 43% of the total Cal-Am production amount (17,100 af/yr) in water year 1997 and about 42% of the current 17,641-af/yr production limit set for Cal-Am by MPWMD.

An approximate 60% reduction in water use would require severe personal and economic hardship for the community. It is not reasonably foreseeable that such a level of inaction would be taken. For example, CPUC Decision 98-08-036, dated August 6, 1998, stated that a plan is needed so that "the Monterey Peninsula does not have to face rationing as a long-term solution" to its water problems. The CPUC has ordered Cal-Am to develop a contingency plan in case the proposed CRDRP does not come to fruition. Also, AB 1182, passed in August 1998, requires that the CPUC develop an alternative resource plan to meet community needs in the event that the CRDRP does not go forward. Given these actions, it is reasonable to assume that the CPUC would order Cal-Am to implement specific water augmentation and conservation projects to avoid chronic rationing.


Of the more than 70 alternatives evaluated above, some (such as conservation and reclamation) are already being substantively implemented, whereas others have the potential to be pursued and implemented in the reasonably foreseeable future. Table A-15 summarizes the results of this qualitative evaluation, which is focused on technical and regulatory feasibility. The following alternative concepts are selected for further quantitative evaluation in Section A.4, either alone or in combination with other options:

  • desalination, with production potential ranging from 3 MGD to 14 MGD;
  • Seaside Basin injection and recovery, with existing Cal-Am facilities to transfer water from Carmel Valley to the Seaside Basin;
  • Seaside Basin injection and recovery, with expanded Cal-Am facilities to transfer water from Carmel Valley to the Seaside Basin;
  • dredging at Los Padres Reservoir (854 af of recovered storage capacity); and
  • additional conservation and reclamation totaling 800 af of annual permanent savings, resulting in a reduced Cal-Am production limit of 16,850 af/yr.

The feasibility of some of these alternatives is questionable or must be confirmed by studies that are under way or planned to begin in the near future. Important concerns exist for some of these alternatives, but not to such a degree that they were dismissed from further consideration in this evaluation.

As described in Section A.4, the selected alternatives were combined in various ways and evaluated quantitatively using MPWMD’s CVSIM computer model. CVSIM is a custom computer model developed by the MPWMD and its consultants that simulates the surface water and groundwater resources within the Monterey Peninsula Water Resources System, with particular focus on the Cal-Am system. It predicts system performance as measured by a variety of factors, based on selected periods of analysis (e.g., water years 1958–1996).

Various sizes and types of water supply alternatives (water production sources), water demand levels, water storage assumptions (e.g., dredging), management scenarios (e.g., rationing programs) and other factors can be input into the model. Its output includes daily and monthly data on surface water and groundwater water storage in Carmel Valley and the Seaside Coastal Subareas, streamflow rate at various locations along the Carmel River, Cal-Am system yield, drought reserve, factors relating to drought protection (e.g., months of rationing and intensity of rationing), environmental factors such as indices of fish health and others. The CVSIM model has been calibrated and has been evaluated by an independent consultant to ensure quality and reliability. The CVSIM model has been accepted as an important predictive tool by various federal and state agencies, such as the Corps, National Marine Fisheries Service, USFWS, SWRCB, California Department of Fish and Game, and Cal-Am.

The combinations of alternatives evaluated using CVSIM were developed with the specific goal of diverting no more than 3,376 af/yr of Cal-Am production from the Carmel River (Cal-Am’s recognized rights), in full compliance with SWRCB Order WR 95-10. The computer model assumes that total community water use is the same as the existing Cal-Am production limit of 17,641 af/yr set by MPWMD’s water allocation program. This assumption is consistent with the "no growth" intent of the proposed CRDRP. An exception is made for computer simulations that assume a permanent reduction of 800 af of annual community water use as a result of permanent conservation and reclamation savings beyond those already achieved or anticipated in the near future.


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