WATER SUPPLY PLANNING COMMITTEE
ITEM:		DISCUSSION ITEMS
4.	DISCUSS PURE WATER MONTEREY BUDGET REVISION AND EXPECTATIONS FOR CURRENT FISCAL YEAR
Meeting Date:		October 14, 2014	Budgeted:	Yes
From:		David J. Stoldt	Program/	Groundwater Replenishment Project
		General Manager	Line Item No.: 1-5-1
Prepared By:		David J. Stoldt	Cost Estimate:	$1,405,000
General Counsel Approval: N/A
Committee Recommendation:
CEQA Compliance: N/A

SUMMARY: At its June meeting the District Board adopted a budget that included expenditure of up to $1,405,000 of the Water Supply Charge for the Groundwater Replenishment Project. This was based upon a 75% share of the Monterey Regional Water Pollution Control Agency (MRWPCA) May 22^nd “bare bones” GWR total budget of $1,580,000 plus what we believed was an additional $293,000 of incremental needs for the externalities study, water purchase agreement, outreach, etc.

After the District Board adopted its budget, MRWPCA subsequently adopted a budget of $1,000,000 which, based on the cost sharing percentages, implied a total GWR budget of $4,000,000. We have not ever agreed to a budget of that magnitude, nor do we have budgeted funds for a $3 million cost share. Subsequently, MRWPCA adopted monthly budgets totaling $1,083,000 year to date.

At its September 29, 2014 meeting the MRWPCA adopted a revised Groundwater Replenishment budget of $2,339,000 (Exhibit 4-A).

This was done with input from the District as described in Exhibit 4-B, where we requested an incremental addition of $607,000. That amount was pared down at the request of MRWPCA to $344,000 by reducing the Public Outreach budget to $90,000 and defining the time period as through the end of January 2015, rather than the whole year.

Please note that the District’s adopted number is also very close to 75% of the “Budget A” figure from MRWPCA’s June 19^th Recycled Water Committee memorandum (Exhibit 4-C), minus $74,883 in grant funds and minus $100,000 in carry forward balances. That number would be $1,417,000 hence our adopted budget was built on the bare bones, but consistent with MRWPCA representations. MRWPCA’s Recycled Water Committee initially recommended their Board adopt Budget A.

Now it is clear that are not sufficient funds available for GWR purposes this fiscal year. The newly adopted MRWPCA budget would yield a 75% cost share of $1,635,000 – an amount the District has not agreed to fund. The adopted MRWPCA budget at this time does not assume the 75%-25% cost sharing. Further, the adopted MRWPCA budget is now only through January 2015, so clearly additional funding will be required, for which the District has not identified sources of funds.

The Committee should discuss the funding situation and prepare for mid-year budget adjustments in January.

EXHIBITS

4-A MRWPCA Groundwater Replenishment Budget Approved September 29, 2014

4-B MPWMD Letter to MRWPCA Dated September 12, 2014

4-C MRWPCA Alternative GWR budgets

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