1. California-American Water Company is authorized to enter into the Revised Water Purchase Agreement contained in Appendix C.
2. California-American Water Company (Cal-Am) shall participate in each Monterey Regional Water Pollution Control Agency (Agency) and Monterey Peninsula Water Management District (District) rate proceeding involving the Revised Water Purchase Agreement (WPA). Cal-Am shall serve written comments to the Agency and District in that rate proceeding. The written comments shall state any and all concerns of Cal-Am with Agency and District proposals, and provide alternative recommendations. If Cal-Am has no concerns, the written comments shall state it has no concerns. At the time Cal-Am serves its comments on the Agency and District, it shall simultaneously serve a copy of the comments on the Commission’s Director of the Division of Water and Audits.
3. California-American Water Company is authorized to upgrade the existing Hilby Avenue Pump Station and construct and operate the Monterey pipeline that was evaluated in the Environmental Impact Report prepared for the Pure Water Monterey Groundwater Replenishment Project as the “Alternative Monterey Pipeline.”
4. Construction of the pipeline and pump station is conditioned on compliance by California-American Water Company with the Mitigation Monitoring and Reporting Program contained in Appendix E.
5. Within 30 days after completion of the pipeline, and the pump station, California-American Water Company shall notify the Division of Water by letter that those facilities are used and useful.
6. The authorization to build the pipeline and pump station is subject to a cost cap of $46.5 million for the pipeline, and $3.8 million for the pump station. If actual costs exceed either cap, California-American Water Company is authorized to file a Tier 3 advice letter to seek additional recovery.
7. California-American Water Company (Cal-Am) is authorized to make two separate Tier 2 advice letter filings to place the costs of the pipeline and pump station into rates. Cal-Am shall file the first Tier 2 advice letter by April 30, 2017 to cover costs for the pipeline and pump station through March 30, 2017, reflecting the recovery of actual costs for the used and useful portions of the facilities to date. Costs for the used and useful portions are the actual reasonable expenditures spent on construction. Cal-Am shall include a showing of reasonableness with its advice letter. Cal-Am shall file the second Tier 2 advice letter within 90 days after the pipeline and pump station are completed and fully in service, and shall include a showing of reasonableness with its advice letter.
8. California-American Water Company (Cal-Am) shall track in a separate section of the its facilities memorandum account: (a) the costs of the pipeline and pump station (including allowance for funds used during construction), (b) a pro-rated portion of the engineering and environmental costs of the entire Cal-Am facilities, (c) and any portion of the pipeline or pump station placed in service prior to the Commission approving the costs to be included in plant in service and recovered in base rates.
9. The Rulings of the Administrative Law Judge(s), and the Joint Rulings of the assigned Commissioner and the Administrative Law Judge(s), are affirmed.
10. The Commission hereby adopts this Statement of Overriding Considerations, which is attached to Monterey Peninsula Water Management District Resolution No. 2016-12 and incorporated herein by this reference.
11. Application 12-04-019 remains open to address Phase 1 issues.
NOTE: "Until and unless the Commission hears the item and votes to approve it, the proposed decision has no legal effect. This item may be heard, at the earliest, at the Commission’s September 15, 2016 Business Meeting."
PROPOSED DECISION
DECISION ON THE APPLICATION OF CALIFORNIA-AMERICAN WATER COMPANY’S APPLICATION FOR APPROVAL OF THE MONTEREY PENINSULA SUPPLY PROJECT SPECIFICALLY IN REGARDS TO PHASE 2
APPENDIX A
SUMMARY OF GROUNDWATER REPLENISHMENT -FOCUSED PROCEDURAL HISTORY
APPENDIX B
POSITIONS OF PARTIES
California American Water Company (Cal-Am), Monterey Peninsula Water Management District (MPWMD), Monterey Region Water Pollution Control Agency (MRWPCA), Monterey Peninsula Regional Water Authority (MPRWA), Planning and Conservation League Foundation (PCL) (Collectively Joint Parties)
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