Agenda

Monterey Peninsula Regional Water Authority (MPRWA)

Technical Advisory Committee (TAC)
Special Meeting
12:00 PM, Wednesday, January 27, 2016
Council Chamber
580 Pacific Street, Monterey
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.

Approve Minutes from November 16, 2015 - Milton

AGENDA ITEMS

2.

Receive Schedule of Technical Advisory Committee Meetings for CY 2016 - Cullem

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

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

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
ADJOURNMENT

Created date 01/25/2016 3:31 PM

Wednesday, January 27, 2016
The Monterey Peninsula Regional Water Authority is committed to including the disabled in all
of its services, programs and activities. In compliance with the Americans with Disabilities Act,
if you need special assistance to participate in this meeting, please contact the Monterey City
Clerks Office at (831) 646-3935. Notification 30 hours prior to the meeting will enable the City
to make reasonable arrangements to ensure accessibility to this meeting [28 CFR 35.10235.104 ADA Title II]. Later requests will be accommodated to the extent feasible. For
communication-related assistance, dial 711 to use the California Relay Service (CRS) to speak to
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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 the Monterey City Clerk's Office at (831) 646-3935 to coordinate use of a
device.
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.

Monterey Peninsula Regional Water Authority

Agenda Report

FROM:

Date: January 27, 2016

Item No: 2.

Executive Director Cullem

SUBJECT: Receive Schedule of Technical Advisory Committee Meetings for CY 2016

RECOMMENDATION:
It is recommended that the Water Authority TAC receive the schedule for its meetings
during calendar year 2016.
DISCUSSION:
During calendar 2015, the Water Authority TAC has been able to conduct business on
the first Monday of each month, with the third Monday of each month reserved for an
optional meeting. Efforts were made to move the meeting to an earlier time or alternate
date but we were unable to secure a regular meeting place and had conflicts with
scheduling member attendance. Therefore, It is recommended that the meeting
schedule remain the same for 2016.
ATTACHMENTS:
A-Draft meeting schedule for CY 2016.

Attachment A

2016 Meeting Dates

Directors Meeting Dates through December 31, 2016
All meetings are on the Second Thursday of the month at 7:00 p.m. unless otherwise posted. The
Fourth Thursday of the month is an Optional Meeting if necessary.

January 14/January 28

August 11 / August 25

February 11 / February 25

September 8 / September 22

March 10 / March 24

October 13 / October 27

April 14 / April 28

November 10 only (November 24 is a

May 12 / May 26

Holiday)

June 9/ June 23

December 8 only

July 14/ July 28

TAC Meeting Dates through December 31, 2016

All meetings are on first Monday of the month at 10:30 a.m. unless otherwise posted. The third
Monday of the month is an Optional Meeting if necessary.

January 4

August 1

February 1

September 19 only (September 5 is a

March 7

Holiday)

April 4

October 3

May 2

November 7

June 6

December 5

July 18 (July 4 is a Holiday)

Monterey Peninsula Regional Water Authority

Agenda Report

Date: January 27, 2016

Item No: 3.

FROM:

Executive Director Cullem

SUBJECT:

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

RECOMMENDATION:
It is recommended that the TAC receive and discuss a Net Present Value
(NPV) Comparison between a 6.4 MGD Desal and a 9.6 MGD Desal
Project.
DISCUSSION:
Cost data was provided to the CPUC on the 6.4 and 9.6 MGD Desal
facilities on December 15, 2015. This cost data will be presented by Cal
Am and discussed at the TAC meeting.
The Water Authority Board has directed the TAC to review the cost
comparison data and provide recommendations to the Board as
appropriate.
ATTACHMENTS:
None

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Monterey Peninsula Regional Water Authority

Agenda Report

Date: January 27, 2016

Item No: 4.

FROM:

Executive Director Cullem

SUBJECT:

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

RECOMMENDATION:
It is recommended that the TAC receive and discuss a Net Present Value
(NPV) Comparison between a 6.4 MGD Desal facility with a 3.2 MGD GWR
vs a 9.6 MGD Desal Project.
DISCUSSION:
The submission deadline for Water Authority testimony was January 22,
and the CPUC Administrative Law Judge (ALJ) will be conducting
settlement discussions for the next two months to resolve differences and
will receive rebuttal testimony on March 22. See attachment A.
In addition, cost data was provided to the CPUC on the 6.4 and 9.6 MGD
Desal facilities as well as for the Pure Water Monterey (PWM)/Ground
Water Replenishment (GWR).
The Water Authority Board has directed the TAC to review and discuss the
cost comparison data and provide recommendations to the Board for
inclusion in rebuttal testimony as appropriate.
For reference, the Nov 30, 2015 MPWMD Status Report on PWM/GWR is
at attachment B. Specifics will be presented by Cal Am and the MRWMD at
the TAC meeting, including discussion of the Externalities Study.
ATTACHMENTS:
A- CPUC Schedule dated Nov 17, 2015
B- Nov 30, 2015 MPWMD Status Report on PWM/GWR
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Attachment A

Attachment B
Status Report
Pure Water Monterey
Groundwater Replenishment Project
(Prepared by MPWMD 11-30-15)

SUMMARY: In July 2013, the District participated with the various parties to A.12-04-019 at
the Public Utilities Commission the Cal-Am application in developing a settlement and
agreement for the proposed Monterey Peninsula Water Supply Project (MPWSP.) The
MPWMD Board of Directors provided direction in closed session whether to approve and sign
the settlement agreement(s). The District and other settling parties signed the agreements July
31, 2013.
At its January 30, 2013 and February 12, 2013 meetings the District Board indicated that it
would consider support for the Cal-Am application if certain conditions were met. One of those
conditions the Board proposed was a strong statement endorsing the Pure Water Monterey
groundwater replenishment project (GWR). This was addressed in the General Settlement
Agreement, Section 4, and included 9 findings or criteria for the acceptance of GWR as part of
the MPWSP. In the Settlement, the Parties agreed the Commission should make the GWR
Decision based upon the findings set forth below and/or information supplied pursuant to the
advice letter process in Section 4.3(f). If all of the findings are made or addressed through the
advice letter process, then California American Water shall be ordered to enter into a WPA and
build the smaller desalination plant.
The purpose of this report is to update the board on where the Pure Water Monterey project
currently stands relative to the 9 acceptance criteria in the July 2013 proposed Settlement
Agreement.
DISCUSSION: The 9 criteria and current status are as follows:
Criterion 1: MRWPCA has approved the GWR Project pursuant to a certified Final EIR; and
no CEQA suit has been filed within 30 days of a Notice of Determination ("NOD"), or if a
CEQA suit is filed, no stay of the GWR Project has been granted.
Status: Satisfied complete.
Criterion 2: The status of required permits is consistent with the published project schedule,
and for any required permits not yet obtained, the weight of the evidence in the record does not
show that any of the required permits for the GWR Project are unlikely to be obtained in a
timeframe consistent the published project schedule.
Status: The GWR Project will need to receive a wide variety of permits and approvals from an
equally wide variety of agencies in order to proceed to construction and operation. A separate
criterion (#4) specifically addresses the permit/approvals required from the California
Department of Public Health and Regional Water Quality Control Board; therefore, it is assumed
this criterion addresses all other permits. Permits are listed in the EIR. Contracts have been

Attachment B
provided to various consultants to work on those permits this fiscal year. There are more permits
required if the Coastal Alignment of the product water pipeline is used. MRWPCA will prepare
a detailed permitting plan that covers all of the components of the GWR Project. The permitting
plan will identify each required permit or approval, the permitting entity, the steps to complete
the permit, the party responsible for obtaining the permit, and the estimated schedule and cost for
the permitting effort. At this time, there is no reason to believe that this criterion will not be met.
Criterion 3: There is sufficient legal certainty as to agreements or other determinations in place
to secure delivery of source water(s) necessary to produce between 3,000 to 3,500 acre feet per
year of GWR product water for the recommended project.
Status: The MRWPCA-MCWRA Amended and Restated Water Recycling Agreement was
approved by both agencies and the County Board of Supervisors in the past 30 days. An
Agreement between MRWPCA and the City of Salinas has also been approved. Hence, this
criterion has been met. A draft definitive agreement is under review and will be circulated the
week of November 30th.
Criterion 4: The weight of the evidence in the record does not show that the California
Department of Health or the Regional Water Quality Control Board will decline to accept or
approve the GWR extraction or GWR treatment and injection processes, respectively.
Status: The Division of Drinking Water (DDW), formerly part of CDPH but now part of
SWRCB, provided a letter dated June 5, 2014 indicating that there were no issues they had to
decline approval of GWR. DDW has been involved in the Independent Advisory Panel meetings
and other update meetings along with their colleagues at the Regional Water Quality Control
Board (RWQCB.) The RWQCB has emailed the SWRCB in support of the project due to their
desire to see the diversion of Blanco Drain water away from the Salinas River. Hence, this
criterion appears to have been met, but additional evidence will be produced as needed.
Criterion 5: The GWR Project is on schedule, as verified by a report issued by an engineer
licensed in California, to be operable, on or before the later of (a) the then-effective date of the
Cease and Desist Order of the SWRCB or such other date as the SWRCB states in writing is
acceptable, or (b) the date the MPWSP desalination project is scheduled to become operable. The
Parties acknowledge that the actual date of operation for the GWR Project and the desalination
project could vary from the operation date projected in the schedules, and therefore agree to a
range of up to an additional four months from the projected date of operation, before the GWR
Project schedule would no longer be considered on an acceptable schedule.
Status: The project is on schedule to be operable long before the desalination project and the
projected revised CDO effective date. However, an engineers report to that effect will be
included in the GWR testimony at the CPUC.
Criterion 6: Preliminary design for the GWR Project is at least at the 10% level, represented by
a basis of design report (so that an accurate project cost estimate can be generated) or is at a level
similar to or more advanced than the level of design for the desalination project portion of the
MPWSP.

Attachment B
Status: The MPWSP desalination facility design is between the 60% and 90% level. GWR has
been designed at or beyond the 10% level of design and one component, connection between the
Ag Wash water and the Salinas Pump Station has been constructed. The connection from the
Salinas storm water and the Salinas Pump Station or the Salinas Industrial Ponds will be
designed to 100%. Criterion met. No additional work required.
Criterion 7: A GWR Project funding plan, sufficient in detail to be accepted as an application
for a State Revolving Fund loan, is in place.
Status: This is complete with one exception, an Approval Order on a change petition to the
SWRCB for the discharge of Salinas Industrial Pond water to the MRWPCA Regional Treatment
Plant, which is expected by the end of November.
Criterion 8: California American Water, MPWMD, and MRWPCA have agreed on a WPA
whose terms are just and reasonable.
Status: A substantially complete version has been exchanged between the parties and looks like
the form of agreement will be agreed to by the end of November. This is covered further under
Agenda Item 21.
Criterion 9: The revenue requirement for the combination of the GWR Project and the smaller
desalination project, including the projected debt equivalence for the GWR Project, if any,
determined pursuant to Section 4.4, is just and reasonable when compared to the revenue
requirement for a larger desalination project alone. The parties agree that a revenue requirement
premium for the combination of the GWR Project and a smaller MPWSP desalination project
may be determined just and reasonable, if the combined GWR/smaller desalination project
affords significant net benefits including, but are not limited to, the following: (i) a material
schedule advantage in that the GWR Project is anticipated to be operable sooner than the
desalination plant; (ii) water supply resilience and reliability (benefit of the portfolio approach);
and (iii) other positive externalities of the GWR Project, including, but not limited to reduced
atmospheric carbon emissions, reduced brine discharge, and the implementation and
encouragement of State policies regarding water recycling through early adoption of a water
reuse project.
Status: An initial cost comparison analysis prepared by the District, but based on cost estimates
made by Cal-Am and filed with the CPUC and estimates prepared by MRWPCA, has been
shared with Cal-Am November 12th. The analysis was revised and circulated the week of
November 16th. The results of that analysis shows positive impact to ratepayers for the Project
Variant of GWR-plus-6.4MGD Desal for both life-cycle savings and net present value of lifecycle savings.
However, the CPUC on October 12th held a prehearing conference on revisions to the Phase 2
proceedings on GWR. At that time, it was made clear that the economic cost comparison
analysis shall be redone for purposes of testimony based on updated Cal-Am costs expected in
December and then-current best available GWR cost estimates. As a result, this analysis shall be
revisited. Cal-Am, the District, and MRWPCA will meet on December 9th to discuss the cost
comparison framework, methodology, and data. A Cal-Am filing of updated costs is due at the
CPUC on December 15th.

Attachment B

Further, the Districts consultant, HDR, is undertaking a study or triple bottom line analysis to
demonstrate the potential benefits environmentally and/or socially, of the externalities. The
HDR study is expected to be complete by the end of the year and inform expert testimony in the
CPUC Phase 2 proceedings on GWR. HDR will hold a half-day workshop for interested
stakeholders on December 8th.

Monterey Peninsula Regional Water Authority

Agenda Report

Date: January 27, 2016

Item No: 5.

FROM:

Executive Director Cullem

SUBJECT:

Receive, Discuss, and Make Recommendations as

Necessary on a CPM Schedule for Permits and Approvals
for the Monterey Peninsula Water Supply Project
(MPWSP)

RECOMMENDATION:
It is recommended that the TAC receive and discuss Cal Am's schedule for
the required permits and approvals for the MPWSP, identify the permits
and approvals critical path to project completion, and make appropriate
recommendations to the Water Authority Board if needed.
DISCUSSION:
An estimated fifty (50) or more permit and approvals remain to be obtained
before the desal plant can be completed and placed in operation in 2020.
Accordingly, the TAC has been tasked by the Water Authority Board to
closely examine Cal Am's latest "detailed" permits and approvals schedule,
including identification of the "permit critical path" in an effort to identify
potential future delays or approval challenges that might require Water
Authority attention.
Cal Am will provide the current Cal Am critical path schedule for Permits
and Approvals at the meeting.
ATTACHMENTS:
None

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