ABSTRACT: The Monterey
Peninsula Water Management District (MPWMD) Board of Directors is scheduled to consider Action
Items
APPOINTMENT OF DISTRICT GOVERNANCE COMMITTEE REPRESENTATIVE FOR
MONTEREY PENINSULA WATER SUPPLY PROJECT and CONSIDER NEGOTIATING A COST SHARING
RELATIONSHIP WITH DEEPWATER DESAL TO ADVANCE A DESALINATION ALTERNATIVE TO THE
CAL-AM PROPOSAL at their Monday, March 18, 2013 meeting. The ACTION ITEMS are presented with a link to
Exhibit 16-A and Exhibit 17-A embedded.
Regular Meeting
Board of Directors
Monterey Peninsula Water
Management District
******************
Monday, March 18,
2013, 7:00 PM
Conference Room,
Monterey Peninsula Water Management District
5 Harris Court, Bldg G, Monterey, CA
by 5 PM on Friday,
March 15, 2013.
Board of Directors
David Pendergrass,
Chair – Mayoral Representative
Brenda Lewis, Vice
Chair – Division 1
Judi Lehman –
Division 2
Kristi Markey –
Division 3
Jeanne Byrne –
Division 4
Robert S. Brower, Sr.
– Division 5
David Potter – Monterey County
Board of Supervisors
General Manager
David J. Stoldt
CALL TO ORDER/ROLL CALL
ACTION ITEMS -- Public comment will be received on
each of these items. Please limit your comment to three (3) minutes
per item.
Action: The Board will appoint a representative
to the Governance Committee that also includes California American Water, County of Monterey, and the Monterey Peninsula
Regional Water Authority
APPOINTMENT OF DISTRICT
GOVERNANCE COMMITTEE REPRESENTATIVE FOR MONTEREY
PENINSULA WATER SUPPLY
PROJECT
Meeting
Date:
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March 18, 2013
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Budgeted:
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N/A
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From:
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David J.
Stoldt,
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Program/
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N/A
|
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General
Manager
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Line Item No.:
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N/A
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Prepared
By:
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David J.
Stoldt
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Cost
Estimate:
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N/A
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General Counsel Approval: N/A
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Committee Recommendation: The Water Supply Planning Committee reviewed
this item on March 11, 2013 and recommended approval.
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CEQA Compliance: N/A
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SUMMARY: At its January 30, 2013 meeting, the Board approved
the “Agreement to Form the Monterey Peninsula Water Supply Project Governance
Committee” attached as Exhibit 16-A. At its March 11, 2013 meeting the
Water Supply Planning Committee approved on a 3-0 vote, a recommendation that
the Board appoint Director Brower to be the District representative and that
Jeanne Byrne be designated as the alternate.
RECOMMENDATION: The Water Supply Planning Committee, on a 3-0 vote,
recommends the Board appoint Director Brower to be the District representative
to the Governance Committee and that Jeanne Byrne be designated as the alternate.
EXHIBIT
16-A Agreement to Form the Monterey Peninsula
Water Supply Project Governance Committee
Action: The Board will decide if staff should
negotiate with DeepWater Desal to establish a cost sharing
relationship for the environmental and permitting work necessary to advance a
desalination alternative to Cal-Am’s Monterey Peninsula Water Supply
Project.
CONSIDER NEGOTIATING A COST SHARING RELATIONSHIP WITH
DEEPWATER DESAL TO ADVANCE A DESALINATION ALTERNATIVE TO THE CAL-AM PROPOSAL
Meeting
Date:
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March 18, 2013
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Budgeted:
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Yes
|
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From:
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David J.
Stoldt
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Program/
|
|
|
General
Manager
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Line Item
No.:
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1-8-1, 1-5-1 adjusted
|
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Prepared
By:
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David J.
Stoldt
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Cost Estimate:
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Not to Exceed $500,000 per
year / 2 years
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General Counsel Approval: N/A
|
Committee Recommendation: On March 13, 2013, the Water Supply Planning
Committee recommended on a vote of 3 to 0 that the Board adopt the staff
recommendation to negotiate withDeepWater Desal on a cost sharing relationship for
environmental and permitting work to advance an alternative desalination
project.
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CEQA Compliance: N/A
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SUMMARY: At its December 10, 2012 meeting the Board approved a
plan that includes the following:
· Develop
a Request for Qualifications (RFQ) to be distributed to any and all potential
ocean desalination project developers to utilize water sources that are not
within the Salinas
Valley Groundwater
Basin. Such an RFQ would define specific project
parameters that the District would determine represents the best qualified
viable project for which a detailed description could be developed for
environmental review.
· The District would partner with
the developer to fund CEQA and NEPA review processes in an amount not to exceed
$500,000 per year; the expenditure would be made over two fiscal
years. The District could undertake this effort as the sole Lead
Agency for CEQA, or could act as co-Lead Agency for CEQA with a locally relevant
agency.
· The RFQ should provide that the
District hold the option, upon certification of the EIR/EIS, for one year to
become the owner of the project or, in the alternative, to negotiate with a
third-party for ownership, and enter into the design and permitting
phase. However, as a condition to a partnership with a developer,
the District should retain the option to terminate at any time, if the CPUC
issues a CPCN to Cal-Am for another project designed to timely meet the potable
water needs of the Peninsula.
· Engage County
representatives and Mayors of the six jurisdictions to discuss the merits of
this parallel plan as a safety “backstop” to the Cal-Am application and seek
their support.
The RFQ was distributed January 25, 2013 to the Peoples Moss
Landing proponents, DeepWater Desal, Marina Coast Water District, JDL
Development, one of the Banks holding a mortgage on the Moss Landing
Commercial Park,
and to an advisor to one of the banks. A third-party developer
originally interested in the RFQ declined. A copy was also forwarded
to California American Water.
Responses from Peoples Moss Landing
and DeepWater Desal were received February 15,
2013. The statements of qualifications were reviewed by the District
Engineer and the General Manager, in conjunction with review of the SPI
consultants report(s) executed for the Monterey Peninsula Regional Water
Authority. The statements of qualification were also distributed to
the members of the Water Supply Planning Committee and made available to the public. Follow-up
questions were asked and the proponents filed additional
information. Staff visited the sites. The District
Engineer and General Manager used an objective scoring system attached hereto
as
Exhibit 17-A to
evaluate the statements. The results of the evaluation indicate that
both projects have great uncertainty, but the DeepWater Desalproject
can move more quickly and may offer advantages.
RECOMMENDATION: The
Water Supply Planning Committee recommended in a 3-0 vote that the Board should
direct staff to enter into further negotiations
with DeepWater Desal to establish a cost-sharing relationship
for the environmental and permitting work necessary to advance that project as
an alternative to the Cal-Am proposal.
BACKGROUND: Cal-Am
(Cal-Am) proposes that its Monterey Peninsula Water Supply Project will consist
of slant intake wells, brackish water pipelines, the desalination plant,
product water pipelines, brine disposal facilities, and related appurtenant
facilities. Depending on the availability of water from the Groundwater
Replenishment Project, the desalination plant is proposed to be sized at either
9.6 mgd or 6.4 mgd located just to the northwest of
the Monterey Peninsula Water Pollution Control Agency (MRWPCA) wastewater
treatment plant. The Project as proposed is to be owned and operated
solely by Cal-Am.
Salinas
Valley agricultural water
users claim that they are at risk of slant wells within the boundaries of the
Salinas Valley Groundwater Basin (SVGB) and that Cal-Am’s plan will cause a
protracted water rights dispute and possibly trigger an adjudication of the
water basin. The Farm Bureau has stated it does “not support any water
project that places a straw in the Salinas
Valley aquifer.”
Claims that have been raised in opposition to Cal-Am’s plan
include (i) whether the project would cause harm to others’ groundwater rights
and should be addressed through an independent hydrological assessment as soon
as possible, (ii) that the SVGB is in overdraft – even though that fact has not
been judicially determined – thus it appears there is no surplus water for the
project to appropriate, (iii) by leaving the groundwater component in the
Salinas Valley, Cal-Am may avoid violation of the Monterey County Water
Resource Agency (MCWRA) Agency Act ban on export of groundwater –
however, this does not mean that Cal-Am is not appropriating groundwater at the
expense of other groundwater users who may be injured by any additional
pumping.
Hence, the risk of litigation over Salinas Valley
Groundwater rights is very high.
Final Commission action on a Proposed Decision is scheduled
for January 2014. It is unclear if a decision can be rendered without
resolution of the water rights issues discussed above, but we can assume that,
just as in the case of the Regional Project previously, the Commission is able
to issue a Certificate of Public Convenience and Necessity (CPCN) to Cal-Am
before any data is obtained from the test wells, and without resolution of the
water rights issues.
However, completion and operation of test wells may be a
critical path to forestall litigation over SVGB water rights. One of
the proposed methods to address the concerns of the agricultural interests is
to develop the supply source from the shallow Sand Dunes
Aquifer. The Growers have indicated that such a solution would be
satisfactory. Cal-Am has indicated that it will gather the necessary
data on the shallow aquifer from its test well.
However, construction of a test slant well is time
constrained, as well. Cal-Am recently reported that it did not
secure permits necessary to begin construction of the test well in the current
November to February 2012-13 Snowy Plover season and will have to wait until
2013-14. This places data-gathering over a year away.
Further, according to Coastal Commission sources, gathering
data from the test well may take as many as two years. Hence, data
to support a shallow Sand Dune Aquifer approach will not become available until
early 2015, and possibly as late as the beginning of 2016.
Therefore, a single linear path that relies on test well
data to resolve potential litigation creates significant risk that the Cal-Am
project proposal to use slant wells may not work or become significantly
delayed. Indeed, even if data are available, it may not yield a
solution that will avoid litigation. It may be in the Monterey Peninsula community’s interest to
develop a parallel process to advance or qualify an alternative project as a
safety contingency. The District could continue to support steady
advancement of the Cal-Am application at the CPUC, while at the same time work
to advance environmental review and permitting of an alternative water
source. This alternative project would be a back-stop to Cal-Am’s
proposal.
The recent draft report “Evaluation of Seawater Desalination
Projects” performed by Separation Processes Incorporated (SPI) indicates
proposed projects utilizing open water intakes and located at Moss Landing
could provide water of equal quality to Cal-Am’s proposal, at that these
alternatives may be realized at comparable or lower costs. To
determine if an open water intake alternative can be approved, it is necessary
to undertake the CEQA/NEPA environmental review, as well as begin the
permitting process with the Coastal Commission. The District could
seek to partner with one of the project proponents, or develop an alternative
with a new/undetermined partner.
EXHIBIT
17-A Evaluation
Matrices of District Engineer and General Manager
