ITEM:		PUBLIC HEARING
17.	CONSIDER ADOPTION OF JULY THROUGH SEPTEMBER 2016 QUARTERLY WATER SUPPLY STRATEGY AND BUDGET
Meeting Date:			June 20, 2016	Budgeted:	N/A
From:			David J. Stoldt,	Program/	N/A
			General Manager	Line Item No.:
Prepared By:			Kevan Urquhart & Jonathan Lear	Cost Estimate:	N/A
General Counsel Review: N/A
Committee Recommendation: N/A
CEQA Compliance: Notice of Exemption, CEQA, Article 19, Section 15301 (Class 1)
ESA Compliance: Consistent with the 2001 Conservation Agreement, 2009 Settlement Agreement between the National Marine Fisheries Service and California American Water to minimize take of listed steelhead in the Carmel River, and SWRCB WR Order Nos. 95-10, 98-04, 2002-0002, and 2009-0060.

SUMMARY: The Board will accept public comment and take action on the July through September 2016 Quarterly Water Supply Strategy and Budget for California American Water’s (Cal-Am) Main and Laguna Seca Subarea Water Distribution Systems (WDS). The proposed budgets, which are included as Exhibit 17-A and 17-B, show monthly production by source of supply that is required to meet projected customer demand in CalAm’s Main and Laguna Seca Subarea systems, i.e., Ryan Ranch, Bishop, and Hidden Hills, during the July through September 2016 period. The proposed strategy and budgets are designed to maximize the long-term production potential and protect the environmental quality of the Seaside Groundwater and Carmel River Basins.

Exhibit 17-A shows the anticipated production by Cal-Am’s Main system for each production source and the actual production values for the Water Year (WY) 2016 to date through the end of May 2016. The anticipated production values assume that Cal-Am’s annual main system production for customer service will not exceed 11,954 acre-feet (AF), including 2,251 AF from Cal-Am’s wells in the Coastal Subareas of the Seaside Groundwater Basin, 300 AF from Sand City Desalination Plant, 600 AF recovered from Water Project 1 and 2 (formerly Phase 1 & 2 ASR), and 8,803 AF from the Carmel River Basin. The total from the Carmel River Basin is consistent with State Water Resources Control Board (SWRCB) Order No. 95-10 and 2009-0060. The total from the Seaside Groundwater Basin is consistent with the Seaside Basin Adjudication Decision. For the purpose of this budget, it is conservatively assumed that Dry inflow conditions will occur for the rest of WY 2016.

Exhibit 17-B shows the anticipated production by Cal-Am’s Laguna Seca Subarea system for each production source and the actual production values for WY 2016 to date through the end of May 2016. Please note that the budgeted production values assume that Cal-Am’s annual production for WY 2016 will not exceed 48 AF from the Laguna Seca Subarea of the Seaside Groundwater Basin, whereas actual demand will exceed that amount. This total is consistent with the Seaside Basin adjudication decision.

RECOMMENDATION: The Board should receive public input, close the Public Hearing, and discuss the proposed quarterly water supply budget. District staff recommends adoption of the proposed budget. The budgets are described in greater detail in Exhibit 17-C, Quarterly Water Supply Strategy Report: July – September 2016.

BACKGROUND: The Quarterly Water Supply Strategy and Budget pertains to production within Cal-Am’s Main and Laguna Seca Subarea systems for the three-month period of July, August, and September 2016. Staff from the District, California Department of Fish and Wildlife (CDFW), the National Marine Fisheries Service (NMFS), and Cal-Am met to cooperatively review, refine and approve this strategy on June 14, 2016. Staff from the State Water Resources Control Board’s, Division of Water Rights (SWRCB-DWR), and the United States Fish and Wildlife Service (USFWS) also attended by phone. Based on current reservoir and Carmel Alluvial Aquifer storage conditions, river flows in October 2015 through May 2016, it was agreed that “Dry” year inflows would be used to conservatively assess Cal-Am’s operations and set monthly production targets for Cal-Am’s systems.

To meet customer demand in its main system, Cal-Am intends to try to avoid producing any groundwater from its wells in the Upper Carmel Valley during July through September 2016, and will focus instead on producing approximately 1,143, 912, and 761 AF of groundwater from its wells in the Lower Carmel Valley during July, August, and September 2016, respectively.

It was also agreed that, subject to rainfall and runoff conditions in the Carmel River Basin, Cal-Am would produce 300, 321, and 350 AF of native groundwater each month in July, August, and September 2016, respectively, from the Coastal Subareas of the Seaside Basin, in addition to 25 AF per month from the Sand City Desalination Plant, and 150 AF per month of stored water from Water Project 1 and 2 (formerly Phase 1 & 2 ASR), during this period. It was also agreed that Cal-Am would budget to produce 6, 5, and 5 AF of groundwater from its wells in the Laguna Seca Subarea for its customers in the Ryan Ranch, Bishop, and Hidden Hills systems during this period. Cal-Am will operate its wells in the Lower Carmel Valley in a downstream-to-upstream order. 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.

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. 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

17-A Quarterly Water Supply Strategy and Budget for CAW Main System: July - September 2016

17-B Quarterly Water Supply Strategy and Budget for CAW Laguna Seca Subarea: July - September 2016

17-C Quarterly Water Supply Strategy and Budget Report: July - September 2016

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