Monterey Peninsula Regional Water Authority

MINUTES MONTEREY PENINSULA REGIONAL WATER AUTHORITY (MPRWA) Director's Meeting 7:00 PM, Thursday, January 12, 2017 MONTEREY MONTEREY, CALIFORNIA Directors Present: Director Dallas, Director Edelen, Director Pendergrass, Director Roberson, Director Rubio, President Kampe Directors Absent: None Staff Present: Legal Counsel Damon, Executive Director Cullem, Clerk Romero CALL TO ORDER President Kampe called the meeting to order at 7:00 pm. ROLL CALL All directors were present. PLEDGE OF ALLEGIANCE REPORTS FROM BOARD DIRECTORS AND STAFF 1. 1. Status of the MPWSP EIR/EIS Release and postponement of TAC review 2. Status of Authority contract with SPI (Geosyntec) for focused analysis of EIR/EIS 3. Status of MCWD and County applications to serve as Groundwater Sustainability Agency (GSA) for the portions of the Salinas Valley Groundwater Basin 4. Status of Public Records Act request relative to the MPRWA 5. CPUC approved the Citizens for Just Water (CJW), incl. Rosemary Knight from Stanford University, as an additional intervener in the MPWSP application 6. Status of the proposed amendment to the Large Settlement Agreement (LSA) 7. Status of Public Water Now's motion to withdraw from the LSA President Kampe asked the board if there are any reports from Directors and Staff. Executive Director Cullem reported the following: o The Monterey Peninsula Water Supply Project (MPWSP) Environmental Impact Report (EIR) has been released for public review and there is a 45-60 day comment period. o Geosyntec will be conducting a focused analysis of the EIR/EIS per the Authority's request. o The Marina Coast Water District (MCWD) and County have applications to serve as a GSA for portions of the Salinas Valley Groundwater Basin which could have some impact on California American Water (Cal Am). o The large Public Records Act Request (PRA) received by the Authority re: MPWSP is being compiled and Don Freeman is facilitating the request.  MPRWA Minutes Thursday, January 12, 2017 o There is a new intervener "Citizens for Just Water" in the large settlement agreement and a Judge has allowed them to participate in the agreement. o Public Water Now has made a motion to withdraw from the settlement agreement. PUBLIC COMMENTS None CONSENT AGENDA On a motion by Director Pendergrass, seconded by Director Edelen, and carried by the following vote, the Monterey Peninsula Regional Water Authority Approved the consent agenda, with Director Rubio abstaining from the November 10, 2016 Minutes: AYES: 6 DIRECTORS: Dallas, Edelen, Pendergrass, Roberson, Rubio, Kampe NOES: 0 DIRECTORS: None ABSENT: 0 DIRECTORS: None ABSTAIN: 0 DIRECTORS: None RECUSED: 0 DIRECTORS: None 2. Approve Minutes of Director's Meeting of November 10, and December 8, 2016 - Romero Action: November 10, 2016, Minutes Approved (5-0-1; Rubio abstained), December 8, 2016, Minutes Approved (6-0) 3. Approve and File Authority Checks Through December 31, 2016 - Romero Action: Approved ***End of Consent Agenda*** AGENDA ITEMS 4. Receive and Approve Annual Financial Report and a Full Opinion Audit for FY 2015-2016 from McGilloway, Ray, Brown and Kaufman CPA (Kaufman), and Provide Staff Direction - Kaufman Patricia Kauffman, CPA, McGilloway, Ray, Brown and Kaufman, gave a presentation on the financial audit for FY 2015-2016. She gave an overview of the audited financial statements and audit opinions. She gave a report on the operating revenues and expenses and stated that contract expenses are lower and legal expenses are higher which was expected. She explained the communication with management accounting policies and said there were no disagreements with management and reported that no material weaknesses were found. She announced the recommendations for FY 15-16 is a general journal entry process and cash disbursement check sequencing. She also recommended QuickBooks security password, control accurate dating of checks and deposits, cutoff controls, and backup of QuickBooks. PUBLIC COMMENT Monterey Peninsula Regional Water Authority Director's Meeting Minutes - Thursday, January 12, 2017 2  MPRWA Minutes Thursday, January 12, 2017 None Mayor Rubio reported that the finance committee went over audit in detail and recommends approval. Executive Director Cullem thanked the Ms. Kaufman and the City of Monterey finance staff for assisting in the audit. On a motion by Director Rubio, seconded by Director Edelen, and carried by the following vote, the Monterey Peninsula Regional Water Authority Approved the Annual Financial Report and Opinion Audit for FY 2015-2016 from McGilloway, Ray, Brown and Kaufman CPA: AYES: 6 DIRECTORS: Dallas, Edelen, Pendergrass, Roberson, Rubio, Kampe NOES: 0 DIRECTORS: None ABSENT: 0 DIRECTORS: None ABSTAIN: 0 DIRECTORS: None RECUSED: 0 DIRECTORS: None 5. Receive Update, Discuss, and Provide Staff Direction on the Deep Water Desal Project and the People's Moss Landing Desal Project - Project Representatives Action: Received Update Kim Adamson from Deep Water Desal (DWD) distributed a list of DWD questions and responses to the Authority and verbally went over the responses to the questions: o The status of DWD public ownership - moving forward as a public-private partnership. This model allows project to move forward more quickly, and private equity is being put to work freeing up off takers bonding capacity. o The status of the support/approval for project source water - approval will not take place until all alternatives for subsurface intake have been ruled infeasible. Determination by SWRCB should be made by the end of the year. o The CEQA/NEPA status - DWD has requested to include the subsurface feasibility study and associated timelines be included in the EIR/EIS o Status of state/local permitting agencies - DWD entered into an agreement with the California Marine Sanctuary foundation to provide funds as a third party for the California Coastal Commission for their review of all marine related permit material as part of the EIR process. o Overall schedule for delivery of water to end user - late 2021. o New info/development pertinent to the project - DWD has initiated power agreement efforts with Salinas and the City will be forming a municipal power agency to supply wholesale power for the project. DWD has estimated a price of $2000-2500 per acre foot. Design level is at 10-20%. Director Edelen asked Ms. Adamson if the bureaucratic process for this project in California is more extensive and costly than other areas. Ms. Adamson responded that she didn’t know but said that the process may be streamlined better. President Kampe asked about the Monterey Peninsula Regional Water Authority Director's Meeting Minutes - Thursday, January 12, 2017 3  MPRWA Minutes Thursday, January 12, 2017 geographical feasibility of subsurface intake, and at what capacity. Ms. Adamson responded that they are looking at two areas: the mouth of the old Salinas River and the Pajaro River mouth, and the capacity is 25,000 acre feet per year. Director Roberson asked about slant wells. Ms. Adamson responded that due to the angles and restrictions of the slant wells they would have to be put on the beach. She added they have asked the California State Parks for access to the beach but aren’t sure how they will respond. Director Roberson asked who the DWD customers would be and what the cost would be from the customer to the public including delivery. Ms. Adamson said that Soquel Creek Water District, Santa Cruz, the Peninsula, Salinas, and Castroville are potential customers. She responded that she doesn't have an answer for the consumer cost because she doesn’t know what the rate structures for deciding cost with delivery are. Director Rubio asked if there is a unit price for cost of water related to the cost of the project. Ms. Adamson responded that for every $10 million dollars spent adds approximately $10 to the cost of water. PUBLIC COMMENT  Tom Rowley, Monterey Peninsula Tax Association (MPTA), thanked the Authority for the presentation from DWD. He stated that MPTA thinks diversified projects are the best. The Board thanks Ms. Adamson for her presentation and update on Deep Water Desal 6. Receive an Update on the Summary Project Schedule for the Monterey Peninsula Water Supply Project (MPWSP) and Status of Test Well Operation and Pipeline Construction - Crooks Action: Received update Catherine Stedman, Cal Am, gave a presentation on MPWSP schedule, pipeline, and test well updates: o The MPWSP EIR came out January 12, 2017. o The consultant on the EIR will be holding public meetings to explain the document. o The remainder of the permitting schedule has stayed the same because the Public Utilities Commission (PUC) has not released new dates. o The desal water start up window is still the end of 2019 or early 2020. o The current Aquifer Storage Recovery (ASR) program has benefited from recent rains to store water. o The Monterey Pipeline construction main relocates will be completed by February. o The test wells are at 92-93% salinity and the data has been posted online. Monterey Peninsula Regional Water Authority Director's Meeting Minutes - Thursday, January 12, 2017 4 MPRWA Minutes Thursday, January 12, 2017 Director Edelen asked if Authority involvement with the MPWSP will be needed once constructions begins in 2018. Ms. Stedman replied that the Authority has been helpful in the permitting process but once construction begins all the necessary permits will have been acquired. She added that perhaps Ian Crooks would have more input to give on the Authority’s involvement during the construction phase. Director Roberson asked for clarification on “main relocates”. Ms. Stedman responded that there are certain areas where the pipeline has to be relocated to accommodate the larger pipeline. PUBLIC COMMENT None President Kampe thanked Ms. Stedman for the Cal Am progress update. ADJOURNMENT President Kampe adjourned the meeting at 8:14pm. ATTEST: Nova Romero, Authority Clerk MPRWA President Monterey Peninsula Regional Water Authority Director's Meeting Minutes - Thursday, January 12, 2017 5