MPRWA TAC Regular Meeting Agenda Packet 11-19-12

Agenda
Monterey Peninsula Regional Water Authority (MPRWA)

Technical Advisory Committee (TAC)
TAC Regular Meeting
2:00 PM, Monday, November 19, 2012
City Council Chamber
Few Memorial Hall of Records
Monterey, California
CALL TO ORDER
ROLL CALL
PLEDGE OF ALLEGIANCE
REPORTS FROM TAC MEMBERS
PUBLIC COMMENTS
PUBLIC COMMENTS allows you, the public, to speak for a maximum of three minutes on any
subject which is within the jurisdiction of the MPRWA TAC and which is not on the agenda. Any
person or group desiring to bring an item to the attention of the Committee may do so by
addressing the Committee during Public Comments or by addressing a letter of explanation to:
MPRWA TAC, Attn: Monterey City Clerk, 580 Pacific St, Monterey, CA 93940. The appropriate
staff person will contact the sender concerning the details.
APPROVAL OF MINUTES
1.
September 17, 2012
2.
October 15, 2012

AGENDA ITEMS
3.
Discuss MPWMD Financial Analysis of SPI Cost Comparisons Report
4.
Discuss Cal Am Requested Surcharge 2, Impacts to Ratepayers, and Provide Direction to

Staff
5.
Review Cost Model and Discuss Strategy and Recommendation for CPUC Cost and
Financial Workshops December 11-13, 2012
ADJOURNMENT
The Monterey Peninsula Regional Water Authority is committed to include the disabled in all of
its services, programs and activities. For disabled access, dial 711 to use the California Relay
Service (CRS) to speak to staff at the Monterey City Clerks Office, the Principal Office of the
Authority. CRS offers free text-to-speech, speech-to-speech, and Spanish-language services
24 hours a day, 7 days a week. If you require a hearing amplification device to attend a
meeting, dial 711 to use CRS to talk to staff at the Monterey City Clerks Office at
(831) 646-3935 to coordinate use of a device or for information on an agenda.
Created date 11/16/2012 11:57 AM
Monday, November 19, 2012
Agenda related writings or documents provided to the MPRWA are available for public
inspection during the meeting or may be requested from the Monterey City Clerks Office at 580
Pacific St, Room 6, Monterey, CA 93940. This agenda is posted in compliance with California
Government Code Section 54954.2(a) or Section 54956.
M I N U TE S
MONTEREY PENINSULA REGIONAL WATER AUTHORITY
TECHNICAL ADVISORY COMMITTEE (TAC)
Regular Meeting
2:00 PM, Monday, September 17, 2012
COUNCIL CHAMBERS
FEW MEMORIAL HALL OF RECORDS
MONTEREY, CALIFORNIA
Members
Present:
Absent:
Staff
Present:
Stoldt, Israel, Narigi, Riedl, Riley

None
Clerk of the Board Milton
CALL TO ORDER
Chair Stoldt called the meeting to order at 2:06 p.m.
ROLL CALL
PUBLIC COMMENTS
Chair Stoldt invited public comments for items not listed on the agenda. David Armanasco gave
an update on the reporting progress and communication with SPI Consultants indicating Deep
Water Desal released a comprehensive preliminary study on the modeling of potential impacts
from the operations of a desalination facility open intake prepared by Tamara Environmental on
September 12, 2012 and will be moving forward with a validation study. Having no further
requests to speak, Chair Stoldt closed Public Comment.
1.
Receive Report From MPRWA Board Meeting of September 13, 2012

Chair Stoldt reported on items presented at the MPRWA Authority meeting on September 12,
2012 including receiving the qualitative risk evaluation, but indicated that the primary discussion
of the Authority meeting was related to governance and finance. He also recommended that
future meeting arrangement include a less formal structure with TAC members sitting at tables
in a discussion format.
2.
Receive Other Reports from TAC Members

Member Riedl spoke about attending a water quality protection program meeting from the State
Water Resources Agency Board which gave progress reports on desalination regulations. He
commented that he received a voice message from Nadar Aga and did not return the call.
Member Israel reported that his agency is conducting meetings on groundwater replenishment
and crafting discussions with the growing community and anticipates a 6-month time frame and
expects positive results. Member Riley expressed concern that there is too much concern and
discussion about governance and time tables and not enough attention being paid to the cost of
water.
MPRWA Minutes
Monday, September 17, 2012
AGENDA ITEMS
3.
Discuss Kris Helm Preliminary Findings and Next Steps

Chair Stoldt introduced the item indicating the memorandum provided by Kris Helm had great
preliminary observations and was encouraged that in the near future data would be available to
give the Mayors enough time to make informed decisions for upcoming deadlines and not just
for February filing testimony. He then introduced Kris Helm, the contracted independent
consultant hired by the MPRWA with development analysis and interagency experience with
regards to water resources. Mr. Helm discussed his preliminary findings with regards to
compliance with environmental laws, permitting and financing implications.
He indicated that the focus of his review will be scheduling and determining if the project can be
implemented in an acceptable time frame to achieve the deadline. However, he needs to
understand the processes which lead to the critical path for accomplishing projects.
Mr. Helm discussed the analysis he is strategizing and requested direction for other areas of
concern. He also discussed his plan for an independent assessment for each project as well as
their development schedule.
Observations which are relevant presented in the memo, made independently about the
administrative process and the facts which may be significant to the Authority with regard to
deadlines and the opportunities to influence the process at specific steps. Discussed the areas
that could lead to a longer process and litigation. Presumptive way to take water with the least
impact was with a subsurface set of wells. Found to have minimal environmental effects, but
other significant issues related to development, not including legal challenges to water rights,
quantities of water extracted, questions about specific system, cost and design which led to an
inadequate review of the environmental review. Prior environmental review included no
analysis of taking water of the ocean , but from existing diversions, discharges as a source
water. 19:38
Observations and Concerns expressed:
CPUC is only reviewing the proposed Cal Am project and not all of the projects.
All projects will have problems reaching the deadline of 2017, and each has the
substantial risk of not achieving environmental compliance.
Determination of the permits and compliance levels that would need to adhere to: EIR,
CEQA, NEPA, Etc. A new intake or discharge system to Monterey Bay would included
Federal Discretionary Approval.
Concern in the record for brine disposal, water intake. The Authority should examine this
question more fully including possible ways the JPA could influence the path for
environmental compliance.
Environmental regulations need to address the cumulative impacts of intake and if there
is a unified approach to handling with a regional
Limited scope versus regional scope
Careful consideration to seek public private partnerships but does not replace CPUCs
advantage.
MPRWA TAC Meeting Minutes

Regular Meeting Minutes - Monday, September 17, 2012
2
MPRWA Minutes
Chair Stoldt recommended pushing item number 5 to next meeting.

Tom Rowley spoke representing the Tax Payer Association urging the MPRWA not to let the
CPUC relationship with Cal Am interfere with the objective analysis of the two other projects
and he expressed anticipation for the consultants results. David Armanasco spoke Deep Water
Desal indicating he attended a meeting in Sacramento that clarified NEPA/CQUA would be
combined project/document which will help with time schedule to a degree.
Nader Aga spoke in support of the Peoples Project that it can meet the deadlines and can
obtain necessary permits and requested three things of the Authority; honesty, commitment and
firmness
Paul Hart an attorney with the Peoples Project in Moss Landing spoke in support of Kris Helms
insights and encouraged the Authority to push for an evaluation of all three projects saying it is
in the publics best interest to consider alternatives. He also expressed concern about support
from the farming community. Chair Stoldt responded that the Farm Bureau submitted a letter of
support for the project echoing that they would support the project as long as it did not take
water from their water supply.
Libby Downey spoke in support of Kris Helm and acknowledged him for his independent
analysis. Safwat Malek expressed appreciation for reviewing multiple projects. Linda McCallam
spoke in support of proceeding with a project with a company other than Cal Am. With no
further requests to speak, Chair Stoldt closed public comment.
4.
Discuss SPI Preliminary Scoping and Constraints Evaluation Memorandum and Next Steps
(Stoldt)
Chair Stoldt deferred item number 4 to a later meeting.
5.
Plan October TAC Meeting Schedule and Agendas

Chair Stoldt recommended returning to the standard schedule of meetings for the month of
October, the first and third Monday and the TAC agreed. He also indicated he will send out an
email with requested topics for the next meetings.
Member Riely commented that he was disappointed that the TAC did not receive a copy of the
risk assessment or an opportunity to analyze and give input prior to distribution to the Authority.
He also requested to agendize a discussion regarding methods to get GWR strategy, as an
alternate plan, on the fast track to approval to ensure some kind of supply availability that will
meet the schedule and deadline. Member Israel responded that the Monterey Regional Water
Pollution Control Agency could put together an analysis of how much impact/assistance GWR
would make to the overall project.
ADJOURNMENT
With no further business to conduct Chair Stoldt adjourned the meeting at 4:08 p.m.

3
MPRWA Minutes
Lesley Milton, Clerk to the Board, Secretary

4
MINUTES
MONTEREY PENINSULA WATER AUTHORITY (MPRWA)
TECHNICAL ADVISORY COMMITTEE (TAC)
Regular TAC Meeting
2:00 PM, Monday, October 15, 2012
FEW MEMORIAL HALL OF RECORDS
CITY COUNCIL CHAMBER
MONTEREY, CALIFORNIA
Members Present:
Members Absent:
Israel, Narigi, Riedl, Riley, Stoldt

None
Staff Present:
Legal Counsel , Acting Executive Director, Committee Clerk
CALL TO ORDER
ROLL CALL
Chair Stoldt called the meeting to order at 2:06 p.m.
George Riley requested that replenishment of the Seaside Aquifer be added to a future agenda.
Chair Stoldt directed that the item when agendized should include a formal report and draft
proposal.
PUBLIC COMMENTS
Chair Stoldt opened public comments for items not on the agenda. George Riley about the
October 2, 2012 Town Hall meeting discussing Cal Am bill spikes and the lowest cost
desalination facility options. David Armanasco spoke about California Public Utilities
Commission (CPUC) Notice of Preparation and that he identified a mistake on page 12 that
characterizes the Deep Water Desal. Incorrectly and notified the CPUC. Doug Wilhelm
questioned the limiting factors of Cal Ams proposed base assumption for replenishment of the
Seaside Aquifer at 350 acre feet per year and stated he was concerned with committing to a
base assumption because year to year changes occur. Chair Stoldt responded that it is related
to the capacity factor for which you can run a desalination plant. With no further requests to
speak, Chair Stoldt closed public comment.
AGENDA ITEMS
1.
Discussion of Potential Issues/Positions on the CEQA Process in Advance of Scheduled

Scoping Meetings
Chair Stoldt introduced the item specifying that there are two places for public participation in
the CEQA process. First, the scoping area provides the ability to give input into the range of the
environmental issues to be addressed in the document. This period invites all responsible
MPRWA TAC Minutes
Monday, October 15, 2012
agencies to try to coordinate early documentation and coordination on the scope of the
document and a chance also for others to make recommendations and comments. The review
and comment period after the draft EIR is released is the second public participation period.
Stoldt indicated the deadline for comments to be received is November 9th, 2012 with scoping
meetings October 24th and 25th. These meetings are chances for the CPUC to orally present
potential issues and this is an opportunity for the TAC to provide the Authority with
recommended messages and or comments to present. Alternatives to address are identified in
the NOP. Chair Stoldt suggested the TAC identify areas of concern that should be addressed
by the Authority.
Member Riley questioned the difference between a subsequent Environmental Impact Report
(EIR) versus a full EIR. Chair Stoldt responded that subsequent EIRs use many of the previous
supporting documents, where an initial EIR develops the initial studies and documents them.
Member Riley asked what triggers NEPA requirements. TAC members came to the conclusion
it is difficult to evaluate at this time.
Member Riley asked if the alternatives analysis is evaluated at the project or at the program
level. The TAC discussed their desire for analysis at the program level. The TAC also
discussed concerns about the ability of the Cal Am project to meet the proposed 2016 deadline
due to the lengthened EIR process and other factors. TAC members agreed that having
multiple projects evaluated is favorable to ensure a project will meet the 2016 CPUC deadline.
Also TAC discussed the possibility of recommending to the Authority the possibility of piece
milling projects as a way to meet the deadline.
Member Israel discussed current results from an MRWPCA analysis of wastewater flows
coming from the Monterey Peninsula and the Salinas Valley. Member Riley spoke to the size of
the facility concerned about the stated margin of 1,000 acre feet of water per year (af/y)of
water. Chair Stoldt responded that capacity can always be reduced if it's not necessary and
suggested the project be built where demand is today, or build larger and scale it back when
necessary to reduce the output. Member Riedl suggested addressing the issue of outfall - how
well the outfall will operate for disbursement.
Chair Stoldt recommended addressing two things with the MPRWA Authority. First is project
sizing and the second is any new data which might be available that can affect the analysis. He
then clarified the next steps the TAC will take. The TAC decided that each member will review
the Notice of Preparation and bring back comments and areas of concern and
recommendations that they would like to be forwarded to the MPRW. The TAC agreed to hold a
Special Meeting October 22 to collectively generate a list of recommendations to forward to the
MPRWA prior to its meeting October 22nd so that the MPRWA comments could be formulated
before the scoping meetings on October 24 and 25th. Chair Stoldt opened the item for
discussion from the public.
City Manager Meurer encouraged the TAC to use extra caution and detail with the CEQA
process to ensure the projects do not spend years in litigation and appeals, stating the scoping
hearing is the opportunity to request the most detailed scope, including review of alternative
projects at the project level and not the program level. He encouraged review of all types of
wells; slant, rainy and direct and review all of them in the different geographical positions. Mr.
Meurer also confirmed that projects built in the Monterey Bay National Marine Sanctuary
require a permit from the Sanctuary, which requires a NEPA document. He noted the NEPA
2
MPRWA TAC Minutes
document needs to be done in coordination from the beginning and not as an afterthought. Mr.
Meurer also encouraged the MPRWA to encourage individuals who are active and interested to
be part of the process and get them to comment on the adequacy of the scope of the document
to make it a community based effort. He requested the TAC pass on his recommendations to
the Authority, who are waiting for TAC recommendations about what they should be saying at
the Scoping Hearings.
Bill hood encouraged the TAC to request a specific level of review of the presented alternatives
indicating it was not guaranteed by the NOP notice unless requested.
Bridget Hoover from the Monterey Bay National Marine Sanctuary clarified from earlier TAC
questions that she has been contacted by ESA doing documentation for the PUC that the
decision was made Cal Am will need to go through the NEPA process. In the short term we
asked them to apply for different permits, one for the test well, apply separately, they were
going to let Cal Am know that this week. With no more requests to speak Chair Stoldt closed
public comment.
2.
Review of Timelines, Schedule for Analysis and Reports from Consultants SPI and Kris Helm
Chair Stoldt confirmed that the Consultant SPI is receiving data back from the different projects
and spoke with Consultant Kris Helm and his preliminary conclusions are very similar to Mr.
Meurers in terms of environmental review. Chair Stoldt asked both consultants to provide a
draft report by the end of the month, and to a repot prior to that so that the TAC has the ability
to review and comment on it before the MPRWA meeting. By consensus the TAC approved an
ad-hoc committee to review and comment on the drafts to provide to the Authority. Legal
Counsel directed the TAC to limit the ad hoc subcommittee to 2 individuals since the TAC is
currently a 5 member board.
Chair Stoldt indicated that the following items and deadlines will guide what the TAC will be
reviewing in the next two meetings.
October 22, 2012 - Cal Am response due for the public participation proposals
October 24 and 25, 2012 CPUC Public Scoping meetings
November 1, 2012 Cal Am report due on the contingency plans
November 9, 2012 - Deadline for providing scoping comments to the CPUC
November 15, 2012 Compliance report available from Cal AM
December 11, 2012 Financial Workshops
Stoldt opened public comment on the item. City Manager Meurer suggested having Consultant
Kris Helm provide input regarding the discussed October scoping meetings in terms of the
adequacy of the EIR/NEPA scope. He said it would leverage current resources and provide
value in the long run. Stoldt agreed to pursue this option and seeing no request to speak closed
public comment.
3.
Discussion of Recent Public Participation Proposals Under Cal-Am's California Public Utilities
Commission Application
Chair Stoldt indicated three responses were submitted to the CPUC Public Participation
proposal. He stated the first was a joint response from the Authority and Monterey County, a
3
MPRWA TAC Minutes
copy was included in the agenda packet, the second from the MPWMD which differed only on
finance and ownership, and two filings from the City of Pacific Grove. The first was combined
with the People's Project encouraging Cal Am to work jointly, and one was looking at Pacific
Grove specific water projects with the intent to get the golf course of the potable water.
Responses from Cal Am regarding the submitted proposals will be available on or after October
26, 2012.
Member Riley spoke to Mr. Meurers suggestion to have a contingency plan in place and is
concerned that the Authority needs to discuss this sooner rather than. Chair Stoldt agreed that
a contingency plan makes sense in the case the application is mired in litigation for years;
something needs to be advanced forward, at the project level and not the program level.
Member Narigi suggested waiting until the November 1, 2012 deadline when Cal Am will
present a contingency plan to the CPUC.
Member Israel spoke to Member Riley's comments that it's important to have some type of
project that can be fully or partially completed by 2016 therefore rationing will not be necessary.
Member Riley requested either the MPRWA or the TAC agendize a discussion on alternative
projects potentially being elevated to a legitimate review in the case that something outside the
scope of the EIR fails the process. Chair Stoldt responded that the discussion has been taking
place, but not with the MPRWA. The MPWMD has funding to advance a project or an
alternative project but there is public concern over one agency to having a majority of the
authority.
Chair Stoldt opened public comment on the item. Libby Downey said Bill Monning advised if the
deadline passes for the Cease and Desist order and the reduction of water is not reached,
having an alternative proposal is viewed more favorably by the State than just failing to reach
your deadline. She expressed concern that the MPRWA is taking too long to make decisions.
She also spoke to Member Riley's comment questioning funding availability from the MPWMD.
Fred Meurer disagreed with Ms. Downeys comments indicating the MPRWA is moving on
multiple fronts, collecting data in order to make proper decisions and switching tactics now it
would take additional time and resources as all proposed projects have substantial hurdles. He
encouraged the MPRWA to focus on the question before the Authority, to determine if the
scope of the environmental documentation is sufficient regardless of which direction the
Authority chooses. It needs to look at all projects and not just the Cal Am Project in the same
level of project detail. Having no further requests to speak, Chair Stoldt closed public comment.
Chair Stoldt said many people may benefit from attending the public meetings at the MPWMD
and MRWPCA. Member Narigi recommended receiving reports from MPWMD and the reports
from MRWPCA. The TAC agendized receiving an update from both the MPWMD and
MRWPCA at the next TAC meeting on November 5, 2012.
Member Israel and Riley questioned the possibility of discussing interim projects on the way to
a final project in order to get the lowest costs. Member Narigi disagreed recommending the
group stay focused on the priorities already set. He stated the purpose of this panel is to give
MPRWA TAC comments from the work of the consultants, and the contingency plan, and then
MPRWA TAC Minutes
move into the financing stage.

Member Riedl questioned why the letter submitted to the CPUC on October 1, 2012 was
different from the letter the County of Monterey submitted. Legal Counsel redirected the
discussion to comments on the agenda. With no more business to discuss, Chair Stoldt
adjourned the meeting at 3:45 p.m.
ADJOURNMENT
Respectfully Submitted,
Approved,
Lesley Milton, Committee Clerk
President MPRWA
Monterey Peninsula Regional Water Authority

Agenda Report
Date: November 19, 2012

Item No: 3.
FROM:
Clerk of the Authority
SUBJECT:
Discuss MPWMD Financial Analysis of SPI Cost Comparisons Report
DISCUSSION: An oral discussion of the attached will take place at the meeting.
Attached: Financial Analysis of SPI Cost Comparison
08/12
Monterey Peninsula Water Supply Project

Financial Analysis of SPI Cost Comparisons
of
Alternative Desalination Projects
Prepared by MPWMD for MPRWA Technical Advisory Committee
Financial Measure
Cal-Am
9kAFY
5.5 kAFY
COSTS (in Millions)
Construction Proceeds
$207.0
$175.0
O & M Cost (2012 $)
$11.0
$7.77
First Year of Operations
2017
2017
Total Revenue Requirement over Lifecycle (40 Years)
$1,331.3
$965.7
Net Present Value of Revenue Requirements (2012 $)
$508.1
$382.5
Revenue Requirement in Common Year, 2019
$29.2
$20.5
Amount of Surcharge 2 Proceeds
$99.15
$99.15
Project Proponent
DWD
9kAFY
5.5 kAFY
$160.0
$12.3
2018
$1,355.4
$434.5
$27.1
$0
$134.0
$9.38
2018
$1,060.0
$342.2
$21.5
$0
PML
9kAFY
5.5 kAFY
$190.0
$10.1
2019
$1,254.1
$401.9
$27.5
$0
$161.0
$7.06
2019
$942.2
$306.5
$21.5
$0
The net present value was calculated using a 5.0% discount rate. Our other assumptions are as follows:
Cal-Am Financing
47% debt / 53% equity
5.00% debt interest rate
9.99% post-tax equity rate of return
40.75% Effective Tax Rate
35% Federal tax rate
8.84% California tax rate
1.05% Ad Valorem Tax Rate
0.2643% Uncollectibles
40 year depreciable life (2.50% factor)
25 year tax depreciable life (4.00% factor)
Use of $99.15 million from Surcharge 2
No SRF Loans
O&M escalation at 2.8% per year
Project operations begin 2017
Public Debt
4.0% interest cost
30 year term
No access to Surcharge 2
Must borrow all interest during construction
Debt service reserve fund equal to one annual debt payment
Issuance costs equal to 1% of proceeds plus reserve
No SRF Loans
O&M escalation at 2.8% per year
Project operations begin 2018 for DWD; 2019 for PML

Financial Analysis of SPI Costs for Cal-Am Project
Scenario 1: 9,000 AF Cal-Am Plant
With Surcharge 2; No SRF Loans
Construction Schedule and Costs
Project Component
Misc Cost
Surcharge 2
Other
Other
Other
Other
Total
2012
2013
Inflated Dollars
2014
2015
2016
Totals
0
0
0
0
0
0
0
0
7,500,000
2,938,000
0
0
0
10,438,000
0
25,000,000
1,225,000
0
0
0
26,225,000
0
33,870,000
15,070,000
0
0
0
48,940,000
0
32,780,000
88,617,000
0
0
0
121,397,000
0
99,150,000
107,850,000
0
0
0
207,000,000

Revenue Requirements Calculation
Capital Costs
Surcharge #1
AFUDC Amount
AFUDC Excluded from ROR
Plant(Transfer to CWIP)
Accumulated AFUDC Excluded from ROR
Accumulated Depreciation
Cumulative Surcharge 2
Cumulative Outside Contributions
Cumulative Deferred Taxes
Rate Base & Return
Average Rate Base
Equity Return Necessary
Debt Return Necessary
Return Necessary, Gross-Up for Taxes
Interest Income Tax Savings, Gross-Up for Taxes
2012
$0
2013
$10,438,000
2014
$26,225,000
2015
$48,940,000
2016
$121,397,000
0
0
0
52,452
37,688
10,490,452
237,216
226,135
36,952,668
617,313
427,225
86,509,981
7,518,185
2,030,084
215,425,166
37,688
263,823
691,049
2,721,133
0
0
7,500,000
0
32,500,000
0
66,370,000
0
99,150,000
0
0
0
2,968,348
1,484,174
4,226,618
3,597,483
19,573,885
11,900,252
114,256,644
66,915,265
Total Return Required (Pre-Tax)
215,425,166
2,721,133
2,838,851
99,150,000
0
738,453
111,160,168
112,708,406
5,967,572
2,648,648
14,503,751
-1,816,835
12,686,917
Expenses
O&M Expense
Purchased Water Cost
Ad Valorem Taxes
Depreciation & Amortization
Total Expense
Revenues from Expenses, Gross-Up for Uncollectibles
15,584
37,774
124,953
702,610
SRF Loan Repayment

Public Agency Contribution Repayment
12,628,689
0
1,183,438
2,838,851
16,650,978
16,695,053
0
0
Total Revenue Requirement (Lifecycle)

NPV of Revenue Requirement (2012 $)
$1,334,035,346
7,500,000
25,000,000
33,870,000
32,780,000
29,381,970
$508,983,124
7,142,857
22,675,737
29,258,179
26,968,187
23,021,542
Cost of Water ($/A-F)

Assumptions:
Purchase Water Annual Cost
Reduction After Yr 30
Purchased Water in AF
Annual O&M Expense (2012)
O & M Cost Inflation Index
Annual Surcharge 2 Contribution
Outside Contribution for Debt?
Contribution Principal Due
Contribution Interest Due
Contribution Length of Loan
Contribution Interest Cost
Outside Contribution for Equity?
Contribution 2 Principal Due
Contribution 2 Interest Due
Contribution 2 Length of Loan
Contribution 2 Interest Cost
AFUDC Rate - 2016
AFUDC Rate thru 2015
Equity Ratio
Equity Rate of Return
Debt Ratio
Debt Interest Cost
Effective Tax Rate
Gross-Up Factor
Ad Valorem Tax Rate
Gross-Up for Uncollectibles
Discount Rate for NPV
Total Acre-Feet Production
2017
$3,265
$0
$0
0
$11,000,000
2.8%
Depreciation Summary:
Remaining Years of Book Depreciation
Composite Depreciation Rate
Cumulative Book Depreciation
Remaining Years of Tax Depreciation
Tax Depreciation Rate
Cumulative Tax Depreciation
Excess of tax over book
Deferred Taxes
(per AF and escalation at 1/2 the O&M rate)

(assumes $76,288,000 at 3.70% for 30 years)
(GWR included or not)
(from SPI Table ES-2)
(combination of labor @ 2.0% and non-labor @ 3.23%)
$0
$7,500,000
N Amount --->
$0
$0
$25,000,000
$0
$33,870,000
$0
$32,780,000
$0
$0
$0
20 years
2.50% (SRF at 2.5% per Linam testimony A.13; 3.70% for municipal debt)
N Amount --->
$0
$0
$0
$0
$0
$0
$0
30
3.70%
4.98%
1.00%
53%
9.99%
47%
5.00%
40.750%
1.683
1.050%
99.736%
5.00%
9,000
years
(SRF at 2.5% per Linam testimony A.13; 3.70% for municipal debt)
(approximation based on Stephenson testimony, Attachment 5)
(Stephenson testimony A.11, A.51; Assumes future capital structure per A.11-05-003)
(Linam testimony A.13; Future capital structure per A.11-05-003 would be 6.63%)
(Linam testimony A.12)
(based uncollectibles rate and state and federal tax rates as shown)
(Stephenson testimony A.57; Linam testimony A.12)
( 0.2643% uncollectible revenues)
2.50% (based on 40 year life; Linam testimony A.12))
4.00% (based on 25 year tax life)
40
2,838,851
2,838,851
25
4,651,007
4,651,007
1,812,156
738,453

Summary of Annual Costs
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
2056
Surcharge 2
7,500,000
25,000,000
33,870,000
32,780,000
99,150,000
Depreciation Pre-Tax Return Property Taxes
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
2,838,851
1,440,809
0
0
0
0
0
0
95,122,887
12,686,917
12,309,320
11,902,527
11,495,578
11,088,630
10,681,681
10,274,732
9,867,783
9,460,834
9,053,885
8,646,936
8,239,987
7,833,038
7,426,089
7,019,141
6,612,192
6,205,243
5,798,294
5,391,345
4,984,396
4,577,447
4,170,498
3,763,549
3,356,600
2,949,652
2,584,484
2,261,317
1,938,373
1,615,429
1,292,486
969,542
646,599
323,655
81,092
0
0
0
0
0
0
207,509,270
1,183,438
1,148,216
1,110,270
1,072,310
1,034,350
996,389
958,429
920,469
882,509
844,548
806,588
768,628
730,667
692,707
654,747
616,787
578,826
540,866
502,906
464,946
426,985
389,025
351,065
313,104
275,144
241,081
210,936
180,812
150,688
120,563
90,439
60,315
30,191
7,564
0
0
0
0
0
0
19,356,508
O&M Costs
12,628,689
12,982,292
13,345,796
13,719,478
14,103,624
14,498,525
14,904,484
15,321,810
15,750,820
16,191,843
16,645,215
17,111,281
17,590,397
18,082,928
18,589,250
19,109,749
19,644,822
20,194,877
20,760,333
21,341,623
21,939,188
22,553,485
23,184,983
23,834,162
24,501,519
25,187,562
25,892,813
26,617,812
27,363,111
28,129,278
28,916,898
29,726,571
30,558,915
31,414,564
32,294,172
33,198,409
34,127,964
35,083,547
36,065,887
37,075,732
910,184,408
Note: No adjustment for uncollectibles for depreciation and Ad Valorem.

Discount rate utilized =
5.00%
Total
Revenue
Requirement
7,500,000
25,000,000
33,870,000
32,780,000
29,337,895
29,278,679
29,197,444
29,126,218
29,065,454
29,015,446
28,976,496
28,948,912
28,933,014
28,929,127
28,937,590
28,958,747
28,992,953
29,040,575
29,101,988
29,177,578
29,267,742
29,372,888
29,493,435
29,629,815
29,782,471
29,951,859
30,138,448
30,342,718
30,565,166
30,851,977
31,203,918
31,575,847
31,968,078
32,381,178
32,815,730
33,272,335
33,751,611
32,944,030
32,294,172
33,198,409
34,127,964
35,083,547
36,065,887
37,075,732
1,331,323,073
Net Present
Value of
Requirement
7,142,857
22,675,737
29,258,179
26,968,187
22,987,008
21,848,201
20,750,078
19,713,771
18,735,851
17,812,967
16,941,957
16,119,837
15,343,795
14,611,175
13,919,475
13,266,336
12,649,530
12,066,959
11,516,645
10,996,722
10,505,432
10,041,118
9,602,216
9,187,255
8,794,846
8,423,683
8,072,533
7,740,234
7,425,695
7,138,452
6,876,079
6,626,702
6,389,541
6,163,913
5,949,173
5,744,715
5,549,968
5,159,212
4,816,610
4,715,691
4,616,886
4,520,151
4,425,443
4,332,719
508,143,534

45,000,000
40,000,000
O&MCosts
PropertyTaxes
PreTaxReturn
Depreciation
Surcharge2
35,000,000
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
1
9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44

Construction Schedule and Costs
Project Component
Misc Cost
Surcharge 2
Other
Other
Other
Other
Total
2012
2013
Inflated Dollars
2014
2015
2016
Totals
0
0
0
0
0
0
0
0
7,500,000
2,293,000
0
0
0
9,793,000
0
25,000,000
2,561,000
0
0
0
27,561,000
0
33,870,000
5,738,000
0
0
0
39,608,000
0
32,780,000
65,258,000
0
0
0
98,038,000
0
99,150,000
75,850,000
0
0
0
175,000,000

Revenue Requirements Calculation
Capital Costs
Surcharge #1
AFUDC Amount
AFUDC Excluded from ROR
Plant(Transfer to CWIP)
Accumulated AFUDC Excluded from ROR
Accumulated Depreciation
Cumulative Surcharge 2
Cumulative Outside Contributions
Cumulative Deferred Taxes
Rate Base & Return
Average Rate Base
Equity Return Necessary
Debt Return Necessary
Return Necessary, Gross-Up for Taxes
Interest Income Tax Savings, Gross-Up for Taxes
2012
$0
2013
$9,793,000
2014
$27,561,000
2015
$39,608,000
2016
$98,038,000
0
0
0
49,211
37,688
9,842,211
237,414
215,353
37,640,625
577,333
493,695
77,825,958
4,650,121
1,554,815
180,514,079
37,688
253,042
746,737
2,301,552
0
0
7,500,000
0
32,500,000
0
66,370,000
0
99,150,000
0
0
0
2,316,685
1,158,343
4,925,605
3,621,145
10,791,738
7,858,671
79,536,752
45,164,245
Total Return Required (Pre-Tax)
2017
180,514,079
2,301,552
1,976,563
99,150,000
0
520,785
77,389,039
78,462,896
4,154,375
1,843,878
10,096,907
-1,264,804
8,832,103
Expenses
O&M Expense
Purchased Water Cost
Ad Valorem Taxes
Total Expense
Revenues from Expenses, Gross-Up for Uncollectibles
12,163
38,022
82,516
474,225
SRF Loan Repayment

Public Agency Contribution Repayment
8,920,446
0
823,860
1,976,563
11,720,870
11,751,895
0
0
Total Revenue Requirement (Lifecycle)
$967,567,999
7,500,000
25,000,000
33,870,000
32,780,000
20,583,998
NPV of Revenue Requirement (2012 $)
$383,095,350
7,142,857
22,675,737
29,258,179
26,968,187
16,128,101
Cost of Water ($/A-F)

Assumptions:
Purchase Water Annual Cost
Reduction After Yr 30
Purchased Water in AF
Annual O&M Expense (2012)
O & M Cost Inflation Index
Annual Surcharge 2 Contribution
Outside Contribution for Debt?
Contribution Principal Due
Contribution Interest Due
Contribution Length of Loan
Contribution Interest Cost
Outside Contribution for Equity?
Contribution 2 Principal Due
Contribution 2 Interest Due
Contribution 2 Length of Loan
Contribution 2 Interest Cost
AFUDC Rate - 2016
AFUDC Rate thru 2015
Equity Ratio
Equity Rate of Return
Debt Ratio
Debt Interest Cost
Effective Tax Rate
Gross-Up Factor
Ad Valorem Tax Rate
Gross-Up for Uncollectibles
Total Acre-Feet Production
Depreciation Summary:
Remaining Years of Book Depreciation
Composite Depreciation Rate
Cumulative Book Depreciation
Remaining Years of Tax Depreciation
Cumulative Tax Depreciation
Excess of tax over book
Deferred Taxes
$2,287
$0
$0
0
$7,770,000
2.8%
(per AF and escalation at 1/2 the O&M rate)

(assumes $76,288,000 at 3.70% for 30 years)
(GWR included or not)
(from SPI Table ES-2)
(combination of labor @ 2.0% and non-labor @ 3.23%)
$0
$7,500,000
N Amount --->
$0
$0
$25,000,000
$0
$33,870,000
$0
$32,780,000
$0
$0
$0
20 years
2.50% (SRF at 2.5% per Linam testimony A.13; 3.70% for municipal debt)
N Amount --->
$0
$0
$0
$0
$0
$0
$0
30
3.70%
3.60%
1.00%
53%
9.99%
47%
5.00%
40.750%
1.683
1.050%
99.736%
5.00%
9,000
years
(SRF at 2.5% per Linam testimony A.13; 3.70% for municipal debt)
(Linam testimony A.13; Future capital structure per A.11-05-003 would be 6.63%)
(Linam testimony A.12)
(based uncollectibles rate and state and federal tax rates as shown)
(Stephenson testimony A.57; Linam testimony A.12)
( 0.2643% uncollectible revenues)
2.50% (based on 40 year life; Linam testimony A.12))
4.00% (based on 25 year tax life)
40
1,976,563
1,976,563
25
3,254,563
3,254,563
1,278,000
520,785

2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
2056
Surcharge 2
7,500,000
25,000,000
33,870,000
32,780,000
99,150,000
Depreciation Pre-Tax Return Property Taxes
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
1,976,563
835,578
0
0
0
0
0
0
66,062,163
8,832,103
8,569,290
8,285,307
8,001,213
7,717,119
7,433,024
7,148,929
6,864,835
6,580,740
6,296,645
6,012,551
5,728,456
5,444,361
5,160,267
4,876,172
4,592,077
4,307,983
4,023,888
3,739,793
3,455,699
3,171,604
2,887,509
2,603,415
2,319,320
2,035,225
1,780,596
1,555,588
1,330,736
1,105,885
881,034
656,183
431,332
206,482
47,028
0
0
0
0
0
0
144,082,387
823,860
799,345
772,855
746,355
719,854
693,354
666,854
640,353
613,853
587,352
560,852
534,352
507,851
481,351
454,850
428,350
401,850
375,349
348,849
322,348
295,848
269,347
242,847
216,347
189,846
166,094
145,106
124,131
103,157
82,183
61,209
40,235
19,261
4,387
0
0
0
0
0
0
13,440,035
O&M Costs
8,920,446
9,170,219
9,426,985
9,690,941
9,962,287
10,241,231
10,527,986
10,822,769
11,125,807
11,437,329
11,757,574
12,086,787
12,425,217
12,773,123
13,130,770
13,498,432
13,876,388
14,264,927
14,664,345
15,074,946
15,497,045
15,930,962
16,377,029
16,835,586
17,306,982
17,791,578
18,289,742
18,801,855
19,328,306
19,869,499
20,425,845
20,997,769
21,585,706
22,190,106
22,811,429
23,450,149
24,106,753
24,781,742
25,475,631
26,188,949
642,921,168
Note: No adjustment for uncollectibles for depreciation and Ad Valorem.

Discount rate utilized =
5.00%
Total
Revenue
Requirement
7,500,000
25,000,000
33,870,000
32,780,000
20,552,973
20,515,417
20,461,711
20,415,072
20,375,823
20,344,172
20,320,332
20,304,520
20,296,962
20,297,890
20,307,540
20,326,157
20,353,992
20,391,303
20,438,355
20,495,422
20,562,783
20,640,727
20,729,550
20,829,556
20,941,060
21,064,382
21,199,854
21,347,815
21,508,617
21,714,831
21,966,998
22,233,285
22,513,912
22,809,280
23,119,800
23,445,899
23,788,012
23,077,099
22,811,429
23,450,149
24,106,753
24,781,742
25,475,631
26,188,949
965,655,753
Net Present
Value of
Requirement
7,142,857
22,675,737
29,258,179
26,968,187
16,103,792
15,308,920
14,541,756
13,817,724
13,134,437
12,489,557
11,880,877
11,306,317
10,763,913
10,251,814
9,768,274
9,311,647
8,880,379
8,473,008
8,088,151
7,724,509
7,380,854
7,056,030
6,748,947
6,458,577
6,183,953
5,924,162
5,678,345
5,445,692
5,225,439
5,024,322
4,840,636
4,666,014
4,499,913
4,341,856
4,191,395
4,048,108
3,911,597
3,613,997
3,402,278
3,330,992
3,261,200
3,192,870
3,125,972
3,060,475
382,503,661

45,000,000
40,000,000
O&MCosts
PropertyTaxes
PreTaxReturn
Depreciation
Surcharge2
35,000,000
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
1
9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44

Financial Analysis of SPI Costs for DWD Project
Scenario 3: 9,000 AF DWD Plant
No Surcharge; No SRF Loans

Principal Due
$0
0
0
0
0
3,895,788
4,051,619
4,213,684
4,382,231
4,557,520
4,739,821
4,929,414
5,126,591
5,331,654
5,544,920
5,766,717
5,997,386
6,237,281
6,486,773
6,746,243
7,016,093
7,296,737
7,588,606
7,892,151
8,207,837
8,536,150
8,877,596
9,232,700
9,602,008
9,986,088
10,385,532
10,800,953
11,232,991
11,682,311
12,149,603
0
0
0
0
0
0
0
0
0
$218,495,000
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
2056
Interest Due
$0
0
0
0
0
8,739,800
8,583,968
8,421,904
8,253,356
8,078,067
7,895,766
7,706,173
7,508,997
7,303,933
7,090,667
6,868,870
6,638,202
6,398,306
6,148,815
5,889,344
5,619,494
5,338,851
5,046,981
4,743,437
4,427,751
4,099,437
3,757,991
3,402,887
3,033,579
2,649,499
2,250,056
1,834,634
1,402,596
953,277
485,984
0
0
0
0
0
0
0
0
0
$160,572,625
Total
Debt Service
$0
0
0
0
0
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
12,635,588
0
0
0
0
0
0
0
0
0
$379,067,625
Debt Service
Reserve Used
$0
0
0
0
0
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
505,424
12,635,588
0
0
0
0
0
0
0
0
0
$27,292,869
Net
Debt Service
$0
0
0
0
0
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
12,130,164
0
0
0
0
0
0
0
0
0
0
$351,774,756
O&M Costs
$0
0
0
0
0
14,516,563
14,923,027
15,340,871
15,770,416
16,211,987
16,665,923
17,132,569
17,612,281
18,105,425
18,612,377
19,133,523
19,669,262
20,220,001
20,786,161
21,368,174
21,966,483
22,581,544
23,213,827
23,863,814
24,532,001
25,218,897
25,925,026
26,650,927
27,397,153
28,164,273
28,952,873
29,763,553
30,596,933
31,453,647
32,334,349
33,239,711
34,170,423
35,127,195
36,110,756
37,121,857
38,161,269
39,229,785
40,328,219
41,457,409
$1,003,630,486
Total
Revenue
Requirement
$0
0
0
0
0
26,646,727
27,053,191
27,471,035
27,900,580
28,342,151
28,796,087
29,262,733
29,742,445
30,235,589
30,742,541
31,263,687
31,799,426
32,350,165
32,916,325
33,498,338
34,096,647
34,711,708
35,343,991
35,993,978
36,662,165
37,349,061
38,055,190
38,781,091
39,527,317
40,294,437
41,083,037
41,893,717
42,727,097
43,583,811
32,334,349
33,239,711
34,170,423
35,127,195
36,110,756
37,121,857
38,161,269
39,229,785
40,328,219
41,457,409
$1,355,405,242
Net Present
Value of
Requirement
$0
0
0
0
0
19,884,198
19,226,198
18,593,478
17,984,962
17,399,622
16,836,476
16,294,585
15,773,054
15,271,027
14,787,688
14,322,255
13,873,984
13,442,162
13,026,108
12,625,171
12,238,731
11,866,193
11,506,989
11,160,578
10,826,439
10,504,077
10,193,019
9,892,810
9,603,016
9,323,224
9,053,036
8,792,074
8,539,973
8,296,388
5,861,903
5,739,083
5,618,835
5,501,107
5,385,846
5,273,000
5,162,518
5,054,351
4,948,450
4,844,768
$434,527,374
Assumes 4.0% interest rate, issuance costs, and reserve fund

Bond Sizing:
Proceeds
Capitalized Interest
Debt Service Reserve Fund
Debt Issuance Costs
Balancing Amount
Issuance Amount
160,000,000
43,699,000
12,635,588
2,163,346
-2,933
218,495,000
Assumptions:
Maturity of Bonds
Interest-Only Period
Interest Rate on Bonds
35 years
5 years
4.00%
5.00%
O&M Expense
12,300,000 in 2012 $
14,516,563 in 2018 $
2.80% escalation rate

$45,000,000
$40,000,000
O&MCosts
DebtService
$35,000,000
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$0
1
10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44


Principal Due
$0
0
0
0
0
3,262,819
3,393,332
3,529,065
3,670,228
3,817,037
3,969,718
4,128,507
4,293,647
4,465,393
4,644,009
4,829,769
5,022,960
5,223,878
5,432,833
5,650,147
5,876,153
6,111,199
6,355,647
6,609,873
6,874,268
7,149,238
7,435,208
7,732,616
8,041,921
8,363,598
8,698,141
9,046,067
9,407,910
9,784,226
10,175,595
0
0
0
0
0
0
0
0
0
$182,995,000
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
2056
Interest Due
$0
0
0
0
0
7,319,800
7,189,287
7,053,554
6,912,391
6,765,582
6,612,901
6,454,112
6,288,972
6,117,226
5,938,610
5,752,850
5,559,659
5,358,741
5,149,786
4,932,472
4,706,466
4,471,420
4,226,972
3,972,746
3,708,351
3,433,381
3,147,411
2,850,003
2,540,698
2,219,021
1,884,478
1,536,552
1,174,709
798,393
407,024
0
0
0
0
0
0
0
0
0
$134,483,570
Total
Debt Service
$0
0
0
0
0
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
10,582,619
0
0
0
0
0
0
0
0
0
$317,478,570
Debt Service
Reserve Used
$0
0
0
0
0
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
423,305
10,582,619
0
0
0
0
0
0
0
0
0
$22,858,457
Net
Debt Service
$0
0
0
0
0
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
10,159,314
0
0
0
0
0
0
0
0
0
0
$294,620,113
O&M Costs
$0
0
0
0
0
11,070,354
11,380,324
11,698,973
12,026,545
12,363,288
12,709,460
13,065,325
13,431,154
13,807,226
14,193,829
14,591,256
14,999,811
15,419,806
15,851,560
16,295,404
16,751,675
17,220,722
17,702,902
18,198,584
18,708,144
19,231,972
19,770,467
20,324,040
20,893,113
21,478,121
22,079,508
22,697,734
23,333,271
23,986,602
24,658,227
25,348,658
26,058,420
26,788,056
27,538,121
28,309,189
29,101,846
29,916,698
30,754,365
31,615,488
$765,370,241
Total
Revenue
Requirement
$0
0
0
0
0
21,229,669
21,539,639
21,858,288
22,185,859
22,522,602
22,868,774
23,224,639
23,590,468
23,966,541
24,353,143
24,750,570
25,159,125
25,579,120
26,010,875
26,454,718
26,910,990
27,380,036
27,862,217
28,357,898
28,867,458
29,391,286
29,929,782
30,483,355
31,052,428
31,637,435
32,238,822
32,857,049
33,492,585
34,145,917
24,658,227
25,348,658
26,058,420
26,788,056
27,538,121
28,309,189
29,101,846
29,916,698
30,754,365
31,615,488
$1,059,990,353
Net Present
Value of
Requirement
$0
0
0
0
0
15,841,906
15,307,819
14,794,549
14,301,202
13,826,924
13,370,899
12,932,348
12,510,529
12,104,732
11,714,278
11,338,521
10,976,843
10,628,653
10,293,386
9,970,505
9,659,494
9,359,862
9,071,138
8,792,874
8,524,640
8,266,027
8,016,642
7,776,110
7,544,073
7,320,189
7,104,130
6,895,583
6,694,248
6,499,839
4,470,297
4,376,634
4,284,933
4,195,153
4,107,255
4,021,198
3,936,944
3,854,456
3,773,696
3,694,628
$342,153,138

Bond Sizing:
Proceeds
Debt Issuance Costs
Balancing Amount
Issuance Amount
134,000,000
36,599,000
10,582,619
1,811,816
1,565
182,995,000
Assumptions:
Maturity of Bonds
35 years
5 years
4.00%
5.00%
O&M Expense
9,380,000 in 2012 $
11,070,354 in 2018 $

$45,000,000
$40,000,000
O&MCosts
DebtService
$35,000,000
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$0
1
10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44

Financial Analysis of SPI Costs for PML Project
Scenario 5: 9,000 AF PML Plant

Principal Due
$0
0
0
0
0
0
4,893,738
5,089,488
5,293,067
5,504,790
5,724,981
5,953,981
6,192,140
6,439,826
6,697,419
6,965,315
7,243,928
7,533,685
7,835,032
8,148,434
8,474,371
8,813,346
9,165,880
9,532,515
9,913,816
10,310,368
10,722,783
11,151,694
11,597,762
12,061,673
12,544,139
13,045,905
13,567,741
14,110,451
14,674,869
15,261,864
0
0
0
0
0
0
0
0
$274,465,000
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
2056
Interest Due
$0
0
0
0
0
0
10,978,600
10,782,850
10,579,271
10,367,548
10,147,357
9,918,357
9,680,198
9,432,513
9,174,920
8,907,023
8,628,410
8,338,653
8,037,306
7,723,904
7,397,967
7,058,992
6,706,458
6,339,823
5,958,523
5,561,970
5,149,555
4,720,644
4,274,576
3,810,666
3,328,199
2,826,433
2,304,597
1,761,887
1,197,469
610,475
0
0
0
0
0
0
0
0
$201,705,145
Total
Debt Service
$0
0
0
0
0
0
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
15,872,338
0
0
0
0
0
0
0
0
$476,170,145
Debt Service
Reserve Used
$0
0
0
0
0
0
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
634,894
15,872,338
0
0
0
0
0
0
0
0
$34,284,250
Net
Debt Service
$0
0
0
0
0
0
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
15,237,445
0
0
0
0
0
0
0
0
0
$441,885,894
O&M Costs
$0
0
0
0
0
0
12,253,867
12,596,976
12,949,691
13,312,282
13,685,026
14,068,207
14,462,117
14,867,056
15,283,334
15,711,267
16,151,182
16,603,416
17,068,311
17,546,224
18,037,518
18,542,569
19,061,761
19,595,490
20,144,164
20,708,200
21,288,030
21,884,095
22,496,849
23,126,761
23,774,310
24,439,991
25,124,311
25,827,792
26,550,970
27,294,397
28,058,640
28,844,282
29,651,922
30,482,176
31,335,676
32,213,075
33,115,042
34,042,263
$812,199,238
Total
Revenue
Requirement
$0
0
0
0
0
0
27,491,312
27,834,420
28,187,136
28,549,727
28,922,471
29,305,652
29,699,561
30,104,501
30,520,778
30,948,712
31,388,627
31,840,860
32,305,756
32,783,669
33,274,963
33,780,013
34,299,205
34,832,935
35,381,608
35,945,645
36,525,474
37,121,539
37,734,294
38,364,206
39,011,755
39,677,436
40,361,755
41,065,236
41,788,414
27,294,397
28,058,640
28,844,282
29,651,922
30,482,176
31,335,676
32,213,075
33,115,042
34,042,263
$1,254,085,132
Net Present
Value of
Requirement
$0
0
0
0
0
0
19,537,562
18,839,431
18,169,679
17,527,056
16,910,370
16,318,483
15,750,312
15,204,819
14,681,016
14,177,961
13,694,754
13,230,535
12,784,485
12,355,820
11,943,794
11,547,693
11,166,837
10,800,575
10,448,287
10,109,380
9,783,287
9,469,468
9,167,408
8,876,612
8,596,610
8,326,951
8,067,207
7,816,965
7,575,834
4,712,580
4,613,840
4,517,169
4,422,524
4,329,861
4,239,141
4,150,320
4,063,361
3,978,224
$401,906,211

Bond Sizing:
Proceeds
Debt Issuance Costs
Balancing Amount
Issuance Amount
190,000,000
65,871,600
15,872,338
2,717,439
3,622
274,465,000
Assumptions:
Maturity of Bonds
36 years
6 years
4.00%
5.00%
O&M Expense
10,100,000 in 2012 $
12,253,867 in 2019 $

$45,000,000
$40,000,000
O&MCosts
DebtService
$35,000,000
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$0
1
10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44


Principal Due
$0
0
0
0
0
0
4,146,835
4,312,709
4,485,217
4,664,626
4,851,211
5,045,259
5,247,070
5,456,952
5,675,230
5,902,240
6,138,329
6,383,862
6,639,217
6,904,786
7,180,977
7,468,216
7,766,945
8,077,623
8,400,727
8,736,757
9,086,227
9,449,676
9,827,663
10,220,769
10,629,600
11,054,784
11,496,976
11,956,855
12,435,129
12,932,534
0
0
0
0
0
0
0
0
$232,575,000
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
2056
Interest Due
$0
0
0
0
0
0
9,303,000
9,137,127
8,964,618
8,785,210
8,598,625
8,404,576
8,202,766
7,992,883
7,774,605
7,547,596
7,311,506
7,065,973
6,810,618
6,545,050
6,268,858
5,981,619
5,682,891
5,372,213
5,049,108
4,713,079
4,363,608
4,000,159
3,622,172
3,229,066
2,820,235
2,395,051
1,952,860
1,492,981
1,014,707
517,301
0
0
0
0
0
0
0
0
$170,920,059
Total
Debt Service
$0
0
0
0
0
0
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
13,449,835
0
0
0
0
0
0
0
0
$403,495,059
Debt Service
Reserve Used
$0
0
0
0
0
0
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
537,993
13,449,835
0
0
0
0
0
0
0
0
$29,051,644
Net
Debt Service
$0
0
0
0
0
0
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
12,911,842
0
0
0
0
0
0
0
0
0
$374,443,415
O&M Costs
$0
0
0
0
0
0
8,565,575
8,805,411
9,051,962
9,305,417
9,565,969
9,833,816
10,109,163
10,392,219
10,683,202
10,982,331
11,289,836
11,605,952
11,930,919
12,264,984
12,608,404
12,961,439
13,324,359
13,697,441
14,080,970
14,475,237
14,880,544
15,297,199
15,725,520
16,165,835
16,618,478
17,083,796
17,562,142
18,053,882
18,559,391
19,079,054
19,613,267
20,162,439
20,726,987
21,307,343
21,903,948
22,517,259
23,147,742
23,795,879
$567,735,309
Total
Revenue
Requirement
$0
0
0
0
0
0
21,477,417
21,717,253
21,963,804
22,217,259
22,477,811
22,745,658
23,021,005
23,304,061
23,595,043
23,894,173
24,201,678
24,517,794
24,842,760
25,176,826
25,520,246
25,873,281
26,236,201
26,609,283
26,992,812
27,387,079
27,792,385
28,209,041
28,637,362
29,077,677
29,530,320
29,995,638
30,473,984
30,965,724
31,471,233
19,079,054
19,613,267
20,162,439
20,726,987
21,307,343
21,903,948
22,517,259
23,147,742
23,795,879
$942,178,724
Net Present
Value of
Requirement
$0
0
0
0
0
0
15,263,599
14,699,091
14,158,064
13,639,470
13,142,310
12,665,633
12,208,530
11,770,135
11,349,619
10,946,196
10,559,112
10,187,650
9,831,124
9,488,881
9,160,297
8,844,778
8,541,754
8,250,685
7,971,052
7,702,362
7,444,144
7,195,947
6,957,342
6,727,919
6,507,286
6,295,069
6,090,913
5,894,474
5,705,429
3,294,140
3,225,120
3,157,546
3,091,388
3,026,616
2,963,201
2,901,115
2,840,330
2,780,818
$306,479,139

Bond Sizing:
Proceeds
Debt Issuance Costs
Balancing Amount
Issuance Amount
161,000,000
55,818,000
13,449,835
2,302,678
4,486
232,575,000
Assumptions:
Maturity of Bonds
36 years
6 years
4.00%
5.00%
O&M Expense
7,060,000 in 2012 $
8,565,575 in 2019 $

$45,000,000
$40,000,000
O&MCosts
DebtService
$35,000,000
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$0
1
10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44

Agenda Report

Item No: 4.
FROM:
SUBJECT:
Discuss Cal Am Requested Surcharge 2, Impacts to Ratepayers, and Provide

Direction to Staff
DISCUSSION: There is no report for this item. A discussion will take place at the meeting.
08/12

Agenda Report

Item No: 5.
FROM:
SUBJECT:
Review Cost Model and Discuss Strategy and Recommendation for CPUC Cost
and Financial Workshops December 11-13, 2012
DISCUSSION: An oral discussion of the attached will take place at the meeting.
Attached: California-American Water Company Compliance Filing On The Monterey Peninsula

Water Supply Project Financial Model
08/12
BEFORE THE PUBLIC UTILITIES COMMISSION

OF THE STATE OF CALIFORNIA
Application of California-American Water
Company (U210W) for Approval of the
Monterey Peninsula Water Supply Project and
Authorization to Recover All Present and Future
Costs in Rates.
A.12-04-019
(Filed April 23, 2012)
CALIFORNIA-AMERICAN WATER COMPANY

COMPLIANCE FILING ON THE MONTEREY PENINSULA WATER SUPPLY
PROJECT FINANCIAL MODEL
Sarah E. Leeper
Javier E. Naranjo
California-American Water Company
333 Hayes Street, Suite 202
San Francisco, CA 94102
Telephone: 415.863.2960
Email: sarah.leeper@amwater.com
Email: javier.naranjo@amwater.com
Attorneys for Applicant
Dated: November 15, 2012
BEFORE THE PUBLIC UTILITIES COMMISSION

OF THE STATE OF CALIFORNIA
Application of California-American Water
Company (U210W) for Approval of the
Monterey Peninsula Water Supply Project and
Authorization to Recover All Present and Future
Costs in Rates.
A.12-04-019
(Filed April 23, 2012)
CALIFORNIA-AMERICAN WATER COMPANY

COMPLIANCE FILING ON THE MONTEREY PENINSULA WATER SUPPLY
PROJECT FINANCIAL MODEL
Pursuant to the Administrative Law Judges Directives to Applicant and Ruling on
Motions Concerning Scope, Schedule, and Official Notice, dated August 29, 2012, CaliforniaAmerican Water Company (California American Water) respectfully submits this compliance
filing to provide a financial model that can be used to compute various revenue requirement
scenarios for the Monterey Peninsula Water Supply Project. California American Water worked
jointly with representatives from the Division of Ratepayer Advocates (DRA) and Monterey
Peninsula Water Management District (MPWMD) to develop the financial model,1 attached
hereto as Attachment 1.
The attached financial model reflects the collaborative efforts of DRA, MPWMD, and
California American Water and includes the input of these interested parties. Counsel for DRA
and MPWMD have authorized the undersigned to state that they support the model, as well as
the use of the model as the basis for a common methodology.2
In addition to an in-person meeting that took place amongst these parties at MPWMD's offices on Tuesday,
October 30, California American Water, DRA, and MPWMD also met on other occasions to develop the model.
2
By telephone, on November 15, counsel for MPWMD and DRA represented that they support the model and based
on the input of their clients believe that the model can be used as the basis for a common methodology to calculate
Dated: November 15, 2012
Respectfully submitted,
By: /s/ Sarah E. Leeper

Sarah E. Leeper
Attorney for Applicant
the various revenue requirement scenarios.
Attachment 1
Monterey Water Supply Project

Key Assumptions
Plant Assumptions
Project Summary ($MM)
Plant Size (MGD)

Capital Scenario
vs. Most Probable Capital Scenario
Include CAW-Only Facilities?
9.0
High End
+25.0%
No
Mobilization/Demobilization
Engineering/Startup
Implementation
Elec, Inst & Control Systems
Contingency
Mitigation Allowance
Exclude Test Well?
2.0%
15.0%
20.0%
40.0%
25.0%
1.0%
Yes
Ground Water Recharge

Annual AF
Cost per AF ($)
0
$3,000
Capital Investment
Desal Plant
CAW-Only Facilities
AFUDC
Total Project Cost
CAW Rate Base at Year End 2017
Utility Plant *
SRF Funded Costs *
Surcharge Funded Costs *
Pub Agency Funded Costs
Deferred Taxes
Total CAW Rate Base
* Net of depreciation & amortization
$254.7
0.0
12.8
$267.5
$260.9
0.0
(102.5)
0.0
(1.2)
$157.2
Total Cost to Customer
Financing Assumptions
Cost of Capital
Cost of Equity
Cost of Debt
Equity %
Debt %
9.99%
5.00%
53.00%
47.00%
Cost of Capital
7.64%
Other Debt Rates

Short Term Debt Rate
Short Term Debt Cap ($MM)
SRF Debt Rate
SRF Term (yrs)
SRF Assets Exempt from Prop Tax?
1.00%
$20.0
2.50%
20
Yes
CAW Financing Scenario

% of SRF Debt in CAW Cap Structure? (Max = 47.0%)
SRF Borrowings ($MM)
CAW Pre-Tax Equity Cost

CAW Pre-Tax Debt Cost
General Taxes
Fixed O&M
Variable O&M
Year 1 CAW Rev Req ($MM)
Customer SRF Surcharge
Public Agency Costs
Total Yr 1 Cost to Customer
3 - CAW Equity & Debt / SRF

0.0%
$0.0
Surcharge & Contribution Assumptions

Utilize a Surcharge?
Period
Period 1
Period 2
Period 3
Period 4
Period 5
Period 6
Period 7
Yes
% of Mont Revenue Req
30.0%
45.0%
60.0%
60.0%
60.0%
60.0%
60.0%
Start Date
07/01/13
01/01/14
07/01/14
01/01/15
07/01/15
01/01/16
07/01/16
End Date
12/31/13
06/30/14
12/31/14
06/30/15
12/31/15
06/30/16
12/31/16
Non CAW Debt via Public Agencies (ie. Public Agency Contribution, SRF Funding off CAW Debt Balance Sheet)
Contribution Amount ($MM)
$0.0
Contribution Date
Jan-14
Financing Rate
2.5%
Financing Term
20
$14.0
3.7
4.1
1.8
2.8
6.9
$33.3
0.0
0.0
$33.3
Fixed Cost per AF

Variable Cost per AF
Total Cost per AF
$2,619
$689
$3,309
CAW Captial Structure

CAW Equity
CAW Debt
SRF Debt
Total
53.0%
47.0%
0.0%
100.0%
Monterey Water Supply Project

Inputs
Project Dates / Timing

Engineering Start Date
Engineering Length (months)
Jul-13
24
Construction Start Date

Construction Length (months)
Jul-15
18
Total Project Length (months)

O&M Expenses Begin
PUC Order
Ground Water Recharge
Cost as of
GWR Begins
Depreciation/Amortization
Book Depreciation Rate
Reg Asset Amorization Rate
CAW Pipeline Depr Rate
CAW Share of O&M in Year 1
Fuel & Power
Chemicals
Membrane/Media Replacemen
Repairs & Maintenance
Purchased Water
Labor
Avoided Costs
O&M Items
Avoided Costs ($MM)
Date of Estimate
Portion of R&R Capitalized
Property Taxes
Property Tax Rate
Surch Exempt from Prop Tax?
42
Jan-17
Jul-13
Jan-17
Jan-17
2.50%
4.00%
2.50%
1.33%
100.0%
100.0%
0.0%
20.0%
100.0%
100.0%
100.0%
$2.0
Dec-12
50.0%
1.05%
Yes
AFUDC Rates
% of Debt as ST in AFUDC Rate
AFUDC Rate
Grossed Up AFUDC Rate
7.64%
11.29%
Taxes
Federal
State
35.00%
8.84%
Effective Tax Rate
40.75%
Yr 1 Monterey Rev Req

Annual Rev Req Inflator
$50.0
3.0%
Uncollectible %
0.3%
Inflation Rates
Consumer Price Index
Water & Sewer Maintenance
1.3%
5.6%
PUC Labor Escalation

2011
2012
2013
2014
2015
CAGR
1.60%
3.10%
1.50%
1.70%
2.10%
2.00%
PUC Non-Labor Escalation

2011
2012
2013
2014
2015
CAGR
5.50%
0.10%
2.00%
6.60%
2.10%
3.23%
Capex
Desal
North Pipeline
Engineering
In Service
Dec-16
Dec-16
Dec-16
Other Ratemaking
CWIP in Rate Base
Reg Assets in Rate Base
Rev Req Inflator
No
No
2.0%
Replacement Capital
Pumps
Chemical Equipment 1
Chemical Equipment 2
Year
20
15
30
O&M Expenses
Fuel & Power
Chemicals
Membrane/Media Replacement
Repairs & Maintenance
Purchased Water
Labor
Avoided Costs
Capacity Factor
Fixed %
0.0%
0.0%
0.0%
0.0%
0.0%
100.0%
0.0%
In Rates
Dec-16
Dec-16
Dec-16
Date
Dec-36
Dec-31
Dec-46
Variable %
100.0%
100.0%
100.0%
100.0%
100.0%
0.0%
100.0%
100.0%

MPRWA TAC Regular Meeting Agenda Packet 11-19-12

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

MPRWA TAC Regular Meeting Agenda Packet 11-19-12

Uploaded by

Copyright:

Available Formats

Agenda

Monterey Peninsula Regional Water Authority (MPRWA)

September 17, 2012

October 15, 2012

Discuss MPWMD Financial Analysis of SPI Cost Comparisons Report

Discuss Cal Am Requested Surcharge 2, Impacts to Ratepayers, and Provide Direction to

Created date 11/16/2012 11:57 AM

Monday, November 19, 2012

Stoldt, Israel, Narigi, Riedl, Riley

Receive Report From MPRWA Board Meeting of September 13, 2012

Receive Other Reports from TAC Members

Monday, September 17, 2012

Discuss Kris Helm Preliminary Findings and Next Steps

MPRWA TAC Meeting Minutes

Monday, September 17, 2012

Chair Stoldt recommended pushing item number 5 to next meeting.

Plan October TAC Meeting Schedule and Agendas

MPRWA TAC Meeting Minutes

Monday, September 17, 2012

Lesley Milton, Clerk to the Board, Secretary

MPRWA TAC Meeting Minutes

Israel, Narigi, Riedl, Riley, Stoldt

Legal Counsel , Acting Executive Director, Committee Clerk

Discussion of Potential Issues/Positions on the CEQA Process in Advance of Scheduled

MPRWA TAC Minutes

Monday, October 15, 2012

MPRWA TAC Minutes

Monday, October 15, 2012

MPRWA TAC Minutes

Monday, October 15, 2012

MPRWA TAC Minutes

Monday, October 15, 2012

move into the financing stage.

Lesley Milton, Committee Clerk

Monterey Peninsula Regional Water Authority

Date: November 19, 2012

Clerk of the Authority

Discuss MPWMD Financial Analysis of SPI Cost Comparisons Report

Attached: Financial Analysis of SPI Cost Comparison

Monterey Peninsula Water Supply Project

Monterey Peninsula Water Supply Project

Construction Schedule and Costs

Monterey Peninsula Water Supply Project

Revenue Requirements Calculation

Total Return Required (Pre-Tax)

SRF Loan Repayment

Total Revenue Requirement (Lifecycle)

Cost of Water ($/A-F)

(per AF and escalation at 1/2 the O&M rate)

2.50% (based on 40 year life; Linam testimony A.12))

4.00% (based on 25 year tax life)

Monterey Peninsula Water Supply Project

Summary of Annual Costs

Depreciation Pre-Tax Return Property Taxes

Note: No adjustment for uncollectibles for depreciation and Ad Valorem.

Monterey Peninsula Water Supply Project

Monterey Peninsula Water Supply Project

Construction Schedule and Costs

Monterey Peninsula Water Supply Project

Revenue Requirements Calculation

Total Return Required (Pre-Tax)

SRF Loan Repayment

Total Revenue Requirement (Lifecycle)