MP Regional Water Authority TAC Meeting

MINUTES MONTEREY PENINSULA WATER AUTHORITY (MPRWA) TECHNICAL ADVISORY COMMITTEE (TAC) Special Meeting 12:00 pm, Wednesday, January 27, 2016 COUNCIL CHAMBER 580 PACIFIC STREET MONTEREY, CALIFORNIA Members Present: Huss, Narigi, Van Der Maatten, Stoldt, Scuito, Riley, Cullem Members Absent: Riedl Staff Present: Legal Counsel, Clerk CALL TO ORDER Executive Director Jim Cullem called the meeting to order at 12:03pm. ROLL CALL TAC Members Riedl and Stoldt were absent. PLEDGE OF ALLEGIANCE PUBLIC COMMENTS Executive Director Cullem opened public comments:  Tom Rowley, representing Monterey Peninsula Taxpayer Association (MPTA) spoke about California American Water’s (Cal Am) proposed 8% water rate increase. He added that the citizens need help lobbying on water rates and it’s time for the TAC and MPRWA (Monterey Peninsula Regional Authority) to look into this.  Gary Cursio, co-Chair of Monterey County Hospitality Government Affairs Committee (MCHA), supports the Collation of Peninsula Businesses and voiced concerns about building proper size desal plant and said MCHA is worried that it will be undersized. With no further requests to speak Executive Director Cullem closed public comments. REPORTS FROM TAC MEMBERS Executive Director Cullem stated the Authority has taken action to co-apply with Cal Am and the Water Management District and extension on the Cease and Desist Order (CDO). He added that many of the major players on board have agreed and the milestones seem reasonable. Member Stoldt arrived at 12:11pm. Member Narigi said the Coalition will be submitting a letter disputing the starting point of 8,310 acre-feet per year(afy) as the acceptable Effective Diversion limit as proposed by the Community in the CDO extension apllication. Executive Director Cullem continued that the Monterey Peninsula Regional Water Authority (MPRWA) had a very significant meeting on Jan. 10th. He reported that MPRWA gave support to Ground Water Replenishment (GWR), gave  MPRWA TAC Minutes Wednesday, January 27, 2016 support to the Castroville Community Services District receipt of return water from the Salinas Basin, and gave support to the Surfrider’s memo regarding brine disposal. He said that what is facing MPRWA now is the revised California Public Utilities Commission (CPUC) schedule which directs that rebuttal testimony be submitted by March 22nd and settlement discussions commence, hopefully bringing Cal Am closer to the desalination (desal) project. Member Narigi said that he is concerned that major decisions by the MPRWA were made without involvement from the TAC. He stated there are a lot of unanswered questions, such as cost, sustainability, environmental value of GWR, and the MPRWA did a disservice to the ratepayers by pushing the GWR Water Purchase Agreement (WPA) forward. Member Riley agreed with Member Narigi that he was surprised at the lack of involvement of the MPRWA with the TAC. He said he was concerned that the current lab composition of the test well water was not posted and doesn’t think Cal Am is meeting the feasibility criteria. Member Huss said he agrees with Riley’s concerns and wants to see the data from the hydrologist. Executive Director Cullem opened public comments:  Tom Rowley, representing Monterey Peninsula Taxpayers Association, said the presentation given at the recent Director’s meeting gave a start date of July 1, 2019, for the desal plant. He said he wants to know if we are going to have a small desal and GWR as backup.  A member of the public said he wished to speak to Dave Stoldt after the meeting. With no further requests to speak Executive Director Cullem closed public comments. Member Sciuto responded to the question about the schedule for GWR, and said that GWR should be ready in the 4th quarter of 2017, and Cal Am can start extracting and put it in the system in mid February, 2018. Member Stoldt said that Water Purchase Agreement (WPA) has a performance start date and the delivery start date for CalAm for immediate use. Don Freeman directed the TAC back to the agenda items. APPROVAL OF MINUTES On a motion by Member Narigi, seconded by Member Riley, and carried by the following vote, the Technical Advisory Committee approved the November 16, 2015 minutes: AYES: 4 MEMBERS: Narigi, Stoldt, Riley, Cullem NOES: 0 MEMBERS: None ABSENT: 1 MEMBERS: Riedl ABSTAIN: 3 MEMBERS: Huss, Vandermaaten, Sciuto RECUSED: 0 MEMBERS: None 1. Approve Minutes from November 16, 2015 – Milton Action:Approved 2  MPRWA TAC Minutes Wednesday, January 27, 2016 AGENDA ITEMS 2. Receive Schedule of Technical Advisory Committee Meetings for CY 2016 - Cullem Action:Approved Executive Director Cullem said in regards to the schedule of meetings, if a meeting is not needed it will be cancelled. On a motion by Member Narigi, seconded by Member Riley, and carried by the following vote, the Technical Advisory Committee approved the Schedule of Technical Advisory Committee Meetings for 2016: AYES: 7 MEMBERS: Huss, Narigi, Riley, Sciuto, Stoldt, Vandermaaten, Cullem NOES: 0 MEMBERS: None ABSENT: 1 MEMBERS: Riedl ABSTAIN: 0 MEMBERS: None RECUSED: 0 MEMBERS: None 3. Receive Report, Discuss, and make Recommendations on the Cal Am Net Present Value (NPV) Cost Comparisons between the 6.4 and 9.6 MGD Desal Plants – Cullem Action: Received report; Discussed Ian Crooks from Cal Am gave a presentation on the Net Present Value (NPV) Comparison between 6.4 MGD desal and a 9.6 MGD desal project. Member Vandermaaten asked about the economies of scale. Ian Crooks responded that the bids came in at about $3 million per well, and the 6.4 MDG plant requires 8 wells, and the 9.6 MDG plant requires 10 wells. Member Vandermaaten said he expected to see an equivalent size and cost increases. Executive Director Cullem agreed with Member Vandermaaten that the numbers don’t match and could be questioned. Ian Crooks responded that he is confident in the numbers and the economies of scale. Executive Director Cullem opened public comment:  Tom Rowley said that the public is becoming more concerned with water rates, timing of the Water Supply Project (WSP) and CDO deadline. He said there is public confusion and in order to gain community support the MPRWA needs to give clear information. Receiving no further comments Executive Director Cullem closed public comments. Member Narigi said that in regard to the sizes of the desal plant, he said the larger desal appears to be more efficient. Member Riley said the risk of litigation will be high after the EIR is completed, and in the process of seeking water rights. 3  MPRWA TAC Minutes Wednesday, January 27, 2016 4. Receive Report, Discuss, and Make Recommendations on the Draft NPV Cost Comparisons between a 6.4 Desal plus GWR vs 9.6 Desal Project, as Well as on the Draft Externalities Study – Cullem Action: Received Report; Discussed Member Stoldt gave a presentation on the Draft Net Present Value (NPV) comparisons between a 6.4 desal plus GWR versus 9.6 desal project and the Draft Externalities Study. He said there are realistic financial scenarios that benefit the ratepayer, and some do not. He added that we have a Water Supply Project that could be economic and beneficial based on the costs alone, and meets policy objectives. Mr. Stoldt continued that the Water Supply Project has received support from State Water Resources Control Board, Legislative Delegation, and Assembly Members. He stated there is a positive net present value to the social and environmental items and the externalities are favorable although the externalities are not included in the cost comparison. Executive Director Cullem invited questions of the Board on Member Stoldt’s presentation. Member Huss said that over the long term he favors the 9.6 desal facility plus GWR. Member Narigi said on behalf of the Coalition, they favor the 3 prong approach to the Water Supply Project but remain concerned about the cost to the ratepayer. He said that GWR is not a guarantee and it’s not a sustainable water source. He questioned if the Peninsula ratepayers will be on the hook for paying for the unseen costs. He said the cost comparison numbers favor the larger size desal facility with GWR as a backup and that is the direction the Authority should go in. Member Huss echoed his colleague’s concern about the cost of the project. Member Sciuto said that his testimony will discuss sustainability. Member Narigi said that Cal Am’s rate design is going to become an issue with residents, on top of the additional costs of the Water Supply Project. Member Riley questioned what is the 20 year cost replacement plan when the data shows pump inefficiency over 18 months of testing. Executive Director Cullem opened public comments:  Tom Rowley, representing MPTA, said the community has a different set of circumstances now than in 2013. He voiced his concern about the ratepayers being on the hook for the cost Water Supply Project and Monterey County should not be compared to Orange County. He urged the Authority and the TAC to lobby for State bond money to pay for the project and not the ratepayers. Receiving no further requests to speak Executive Director Cullem closed public comments. 5. Receive, Discuss, and Make Recommendations as Necessary on a CPM Schedule for Permits and Approvals for the Monterey Peninsula Water Supply Project (MPWSP) – Cullem Action: Received Report; Discussed 4 MPRWA TAC Minutes Wednesday, January 27, 2016 Ian Crooks gave a presentation on Cal Am’s schedule for the required permits and approvals for the Monterey Peninsula Water Supply Project (MPWSP). He spoke about the critical path timeline for the Environmental Impact Report (EIR), and Coastal Commission Approval Process. Executive Director Cullem said the City of Marina permit approval process could take 4 months and doubted whether the Marina City Council would aid in speeding up the process. Member Narigi asked Mr. Crooks if progress has been made with the City of Monterey on the pipeline issue and Mr. Crooks responded that it is progressing. Member Riley questioned if EIS is merged with EIR if the approval process timeline would change. Mr. Crooks responded that EIR and CPCN have to be approved before the EIS. Executive Director Cullem opened public comments and receiving none closed public comments. ADJOURNMENT Executive Director Cullem adjourned meeting at 2:08pm. Respectfully Submitted, Approved, Nova Romero, Committee Clerk President MPRWA 5