Agenda

Monterey Peninsula Regional Water Authority (MPRWA)

Regular Meeting
7:00 PM, Thursday, November 13, 2014
Council Chamber
580 Pacific Street
Monterey, California

ROLL CALL
PLEDGE OF ALLEGIANCE
REPORTS FROM BOARD DIRECTORS AND STAFF
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 and which is not on the agenda. Any person
or group desiring to bring an item to the attention of the Authority may do so by addressing the
Authority during Public Comments or by addressing a letter of explanation to: MPRWA, Attn:
Monterey City Clerk, 580 Pacific St, Monterey, CA 93940. The appropriate staff person will contact
the sender concerning the details.

CONSENT CALENDAR
1.

Approve Minutes from October 9, 2014 - Milton

2.

Approve and File Checks Through November 13, 2014 - Milton

3.

Adopt a Resolution Approving Donald G. Freeman as Legal Counsel through December

31, 2015 and Authorizing the Authority President to Execute a Contract Extension with
Perry Freeman at a Price Not-to-Exceed $63,000. - Cullem

4.

Adopt a Resolution Approving Brownstein, Hyatt, Farber and Schreck as Special Legal
Counsel through December 31, 2015 and Authorize the Authority President to Execute a
Contract Extension at a Price not-to-Exceed $152,000. - Cullem

5.

Approve Extension of Deadline for Fiscal Year 2013-14 Financial Report and Full Opinion
Audit to December 21, 2014 and Authorize a Time Extension of the Contract with
McGilloway, Ray, Brown and Kaufman to March 31, 2015. - Cullem
AGENDA ITEMS

6.

Receive Report, Discuss, and Provide Direction on the Meeting with State Water
Resources Control Board Staff on November 7, 2014. - Cullem/Burnett

7.

Receive Report, Discuss, and Provide Direction on the Coastal Commission Decision on
the Test Slant Well CDP at its Meeting on Nov 12, 2014 - Crooks

Thursday, November 13, 2014

8.

Receive Report, Discuss, and Provide Direction to Staff on Crediting FY 13-14 Year-End
Budget Surpluses to Contributing Cities - Cullem
ADJOURNMENT

The City of Monterey 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 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 35.102-35.104 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 City offices. CRS offers free text-to-speech, speechto-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 the 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.

M I N U TE S
MONTEREY PENINSULA REGIONAL WATER AUTHORITY (MPRWA)
Regular Meeting
7:00 PM, Thursday, October 9, 2014
MONTEREY COUNCIL CHAMBER
PACIFIC STREET
MONTEREY, CALIFORNIA
Directors Present:

Burnett, Della Sala, Edelen, Kampe, Pendergrass, Rubio

Directors Absent:

None

Staff Present:

Executive Director, Legal Counsel, Clerk

ROLL CALL
The meeting was called to order at 7:00 PM.
PLEDGE OF ALLEGIANCE
REPORTS FROM BOARD DIRECTORS AND STAFF
President Burnett invited comments from the Directors and staff.
Director Pendergrass announced Todd Bodem was appointed as City manager of the City of
Sand City. Director Burnett reported that City of Carmel By the Sea appointed Doug Schmitz as
City Administrator. He also commended Dave Stoldt for being recognized as the Best Manager
of Special Districts in the State of California. All Directors concurred that he deserved it.
Executive Director Cullem reported that Cal Am will host a rate workshop for the public at
Monterey City Hall on Monday, October 10th and encouraged the residents to attend. He then
reported that there was a desalination conference in Monterey which was very informative.
PUBLIC COMMENTS
President Burnett invited public comment for items not on the agenda.
Tom Rowley reported that the TAC meeting, under Executive Director Cullem's leadership, was
run very efficiently and handled some tricky technical issues. He reported on the status of a
lawsuit against the Monterey Peninsula Water Management District.
CONSENT AGENDA
Executive Director Cullem requested that the Directors consider a 60 day extension instead of
one year for Public Relations, at no additional funding, due to the need to revise the scope
further.
On a motion by Director Kampe, seconded by Director Rubio, and carried by the following vote,
the Monterey Peninsula Regional Water Authority approved Items 1 and 2 on the consent
agenda as presented and approved a 60 day extension to the contract with Environmental
Relations at no additional cost.
AYES:

DIRECTORS:

Burnett, Della Sala, Edelen, Kampe, Pendergrass,

Rubio

MPRWA Minutes
NOES:
ABSENT:
ABSTAIN:
RECUSED:

0
0
0
0

Thursday, October 9, 2014

DIRECTORS:
DIRECTORS:
DIRECTORS:
DIRECTORS:

None
None
None
None

1.

Approve and File Checks

Action: Approved

2.

Approval of Minutes from September 11, 2014

Action: Approved

3.

Approve A One-Year Extension With Environmental Resources, Inc. For Public Information
Services At A Total Price Not-To-Exceed $15,000 And Authorize The Executive Director To
Negotiate The Terms Of The Contract Extension And To Award The Contract
Action: Approved a 60 Day Extension at no additional cost.
AGENDA ITEMS

4.

Receive Report, Discuss, And Provide Direction On California Public Utilities Commission
Decision On Surcharge 1 & 2 Schedules.
Executive Director Cullem spoke to the item in the absence of Dave Stoldt from the Monterey
Peninsula Water Management District and spoke to the memo provided by Ms. Catherine
Stedman, Manager of Public Affairs for Cal Am regarding surcharge 1 and 2 schedules.
President Burnett invited public comment on the item and had no requests to speak.

5.

Receive Report, Discuss, And Provide Guidance On Ground Water Replenishment Source and
Product Water Negotiations And Schedule.
Keith Israel, General Manager from the Monterey Regional Water Pollution Control Agency,
presented the item. He noted that the project has received approvals of the MOU from six
different parties. He spoke to additional presentations and outreach made to ensure full
understanding of the project, the water needs, and impacts. After the MOU is fully executed
staff will begin developing definitive agreements with various agencies with the goal of
completion by the end of March 2015. Mr. Israel acknowledged the cooperation and effort from
various organizations. He also reported an extension request has been submitted to the
California Public Utilities Commission to which he anticipates an answer soon.

Mr. Israel then answered questions from the Board. The directors asked Mr. Israel questions
regarding the details of the agreement and the negotiations. Mr. Israel indicated there will be
a number of activities going forward to develop the agreements. Director Pendergrass spoke to
the efforts of Mr. Israel and indicated that the approval of the MOUs released $1.4 million for
use toward the project.
Director Kampe questioned a provision in the agreement regarding the commitment of
all water in the service area, as opposed to the water entering into the system. He requested
that the agreement include only that water that enters the PCA facility. There was discussion
of the inclusion of stormwater and how it shoulde be defined and delineated in the document.
President Burnett invited public comments and had no requests to speak. This was an
informational briefing and no action was taken.
Monterey Peninsula Regional Water Authority
Regular Meeting Minutes - Thursday, October 9, 2014
2

MPRWA Minutes
6.

Thursday, October 9, 2014

Receive Report And Discuss The Latest Information On Public Funding, Including Bond
Funding, For The Monterey Peninsula Water Supply Project and Ground Water Replenishment
Project
Executive Director Cullem reported for Dave Stoldt regarding the new water bond. He
statedthat if passed, the bond would provide up to $729 million for projects like the GWR and
the desal facility.
Mayor Rubio indicated that he met with the Chair of the Latino Water Coalition who stressed
getting applications in early, and in communicating with key staffers who are shaping key
requirements for the bond. He also reported that a tour is scheduled for staffers
and this time they will make an unusual visit to the Central Coast which gives us an
opportunity to work together with them.
President Burnett invited public comment and had no requests to speak. He reported that he
will take Mayor Rubio's advice and reach out early to the staff members as suggested.

7.

Receive Report And Discuss Status Of The Deep Water Desal And Peoples Desal Projects,
Including The Kennedy/Jenks Consultants Cost Comparison Study.
Executive Director Cullem reported that the TAC discussed the Kennedy/Jenks Cost
Comparison Study addressing the costs of water from Deep Water Desal as well as the
Peoples Water project as compared to the estimated cost of water from Cal Am's MPWSP. The
TAC agreed that the report makes big assumptions because many cost figures are dependent
upon elements that still have yet to be developed. They expressed caution at apparent
discrepancies between what Kennedy/Jenks quotes and information on the Deep Water Desal
website. The TAC members also were concerned that the total necessary piping was not
included in the study but should be included in the cost of the DWD plant, as it is included in the
cost analysis of the MPWSP.

David Ball spoke representing the People's Moss Landing project and reported that the
Moss Landing Harbor District has agreed to become the lead CEQA Agency for the
project and is working with Pacific Grove to end their formation agreement. He spoke
to the Kennedy/Jenks report and expressed concern with inconsistencies.
George Riley requested that if the DWD project becomes more viable and that it be
looked at more favorably because it would be an economic development project as well
as may provide water to north Monterey County.
David Armanasco spoke representing Deep Water Desal and expressed concern that
the report data was skewed because they were not comparable metrics. He expressed
frustration with speculation made within the report instead of reaching out to DWD
directly.

The Directors requested the Executive Director and the TAC review the three
projects against the criteria previously established by the Authority as part of their work plan.
8.

Receive And Discuss Report Made On September 30, 2014 to the Monterey County Board Of
Supervisors For Consideration Of Fair-Share Funding For The Water Authority Budget, And
Provide Staff Direction

Monterey Peninsula Regional Water Authority

Regular Meeting Minutes - Thursday, October 9, 2014
3

MPRWA Minutes

Thursday, October 9, 2014

Executive Director Cullem reported on his presentation to the Monterey County

Board of Supervisors regarding participating in the Authority. They accepted the report but did
not commit to future involvement. He noted that Supervisor Calcagno was concerned that
we were taking water from the Salinas Basin and that our plant size should be larger to
accommodate needs of more than the Peninsula. Supervisor Potter was concerned
regarding mission creep of the Authority, the involvement with GWR as well as issues with
budget requirements. Potter further requested that Members of the Board meet with
Supervisors to discuss fair share contributions for the current and future fiscal years.
Director Edelen requested clarification as to why they would not want to join the organization.
The directors discussed their perception that the County did not want to participate. President
Burnett elaborated on Supervisor Potter's concern regarding mission creep and the need to
discus and develop a plan to ramp down the Authority. The Directors discussed the mission of
the authority the work plan and the process of disbanding.
President Burnett invited public comments.
Tom Rowley spoke in support of obtaining Monterey County's Fair Share contribution
and participation and expressed disappointment that no Director attended the Board
of Supervisors meetings to rebut misconceptions and to defend the valiant efforts of
the Authority. He also requested that all land use jurisdictions should be
members of the MRWMD.
The Board discussed a range of ideas for the sunset of the Authority. They requested that Jim
work to create a ramp down plan, to monitor and watch for mission creep, and to review the
budget to see if there are any ways to reduce expenditures. They also requested that Legal
Counsel Freeman work with the Board of Supervisors and report back at the next meeting.
9.

Receive Separation Processes Inc. Analysis Of The Value Engineering Alternatives And TAC
Recommendations, Discuss, And Provide Water Authority Recommendations To The
Governance Committee
Jim provided a verbal review the Separation Processes, Inc. (SPI) analysis of Monterey of the
Final Value Engineering ( VE) Study of the Monterey Peninsula Water Supply Project (MPWSP)
requested any direction from the Directors to provide to the Governance Committee. Ian
Crooks, Engineering Manager from Cal Am spoke to the VE process and to which
suggestions that Cal Am is accepting and why it is rejecting others, mainly citing rejection of
those with high risk or unknown factors. Mr. Cullem noted that He reported that the TAC
recommended that the Directors accept Cal Am's recommendations as they are comfortable
the combination of the two reviews and the Cal Am Board provided a full analysis of options.
President Burnett invited public comment and had no requests to speak.
On a motion by Director Rubio, seconded by Director Edelen, and carried by the following vote,
the Monterey Peninsula Regional Water Authority approved the staff recommendation and
directed the recommendations be forwarded to the Governance Committee for approval. .
AYES:

DIRECTORS:

NOES:
ABSENT:
ABSTAIN:
RECUSED:

0
0
0
0

DIRECTORS:
DIRECTORS:
DIRECTORS:
DIRECTORS:

Burnett, Della Sala, Edelen, Kampe, Pendergrass,

Rubio
None
None
None
None

Monterey Peninsula Regional Water Authority

Regular Meeting Minutes - Thursday, October 9, 2014
4

MPRWA Minutes
10.

Thursday, October 9, 2014

Receive And Discuss The Current Monterey Peninsula Water Supply Project Critical Path
Schedule (Summary Version) With Emphasis On Permits And Approvals, Including Cemex
Access, As It Pertains To The November Coastal Commission Meeting On The Coastal
Development Permit For The Test Slant Well.
Ian Crooks reported on the item and to the Cemex Slant well anticipated schedule noting it is
a key part of the project and anything that the public can do to weigh in should be
communicated. Catherine Stedman, Public Affairs Manager from Cal Am Water reported on
the outreach that will be conducted by Cal Am to encourage people to contact the Costal
Commission.
Director Pendergrass questioned if the litigation from CEMEX will affect the Coastal
Commission to which Catherine responded that the Coastal Commission typically requires
that you have access to the property prior to the commission hearing and they could make it a
condition on the permit if the Judge does not rule favorably in advance.
President Burnett Invited public comments on the item.

George Riley requested that this be agendized for a longer discussion at a

future meeting.

Executive Director Cullem reported on the summary schedules for the MPWSP project and
noted that the TAC discusses it in more detail.
11.

Receive Report, Discuss, And Provide Guidance, Including The Nature And Timing Of A Water
Authority Letter To The State Water Resources Control Board On Current Efforts To Seek An
Extension Of The Cease and Desist Order Date Based On Circumstances Beyond Community
Control
Executive Director Cullem spoke to the purpose of the item discuss the tone and timing of
letters to the State Water Resources Board (SWRCB), as well as other appropriate actions to
support an extension of the Cease and Desist Order (CDO 2009-60) deadline. He requested
direction on the content and timing of the letter to be submitted. The Directors discussed the
advantages of sending a letter earlier rather than right at the deadline and decided that it be
sent after November 7th following the meeting with the State Water Resources Control Board.
President Burnett invited comments from the public.

George Riley expressed frustration with the timeline, noting it is tight is concerned that it
will go forward regardless of costs.

ADJOURNMENT
The meeting was adjourned at 9:28 PM.

Monterey Peninsula Regional Water Authority

Regular Meeting Minutes - Thursday, October 9, 2014
5

MPRWA Minutes

Thursday, October 9, 2014

ATTEST:

Lesley Milton, Clerk of the Authority

Jason Burnett MPRWA President

Monterey Peninsula Regional Water Authority

Regular Meeting Minutes - Thursday, October 9, 2014
6

Monterey Peninsula Regional Water Authority

Agenda Report

FROM:

Date: November 13, 2014

Item No: 2.

Authority Clerk Milton

SUBJECT: Approval and File Authority Checks Through November 13, 2014.
RECOMMENDATION:
It is recommended that the Authority approve and file the accounts payable payments
made during the period October 9, 2014 through November, 2014 with total payments
for the above referenced period of $26,693.81 from the general fund account and
$8,892.00 from the special reimbursement account and authorize the Directors to sign
for such checks.
DISCUSSION:
At its meeting on September 12, 2013, the Authority Board approved a staff
recommendation to provide the Directors a listing of general checks issued since the last
report so that it can inspect and confirm these checks. Each invoiced expense has been
reviewed and approved by the Executive Director and Finance personnel prior to payment
to insure that it conforms to the approved budget.
The following checks are hereby submitted to the Authority for inspection and
confirmation.

$ 525.00 Reimbursement o to Access Monterey Peninsula for Video

Production Services

$ 3,240.00 to Brownstein, Hyatt, Farber and Schreck for Special Legal Counsel

$ 5,000.00 to Perry and Freeman for Legal Counsel of Record Services

$17,603.81 to City of Monterey for Reimbursement for Executive Director

Contracted Services

325.00 to Jim Cullem for reimbursement for conference expenses

The bank balance as of November 7, 2014 is sufficient cover the above checks
therefore, staff is recommending approval of the above checks.
The following check is submitted to the Authority for inspection and payment from the
separate account established for the Value Engineering study, which is fully
reimbursable by Cal Am. The Authority has adequate funds to cover the balance of this
invoice.

$8,892.00 to Separation processes Inc. for Engineering Review of the Value

Engineering Study final Report from VMS.

ATTACHMENTS:

Budget to Actual Report through November 6, 2014

2:08 PM
11/06/14
Accrual Basis

Monterey Peninsula Regional Water Authority

Budget Status
July 1 through November 6, 2014
Budget

Jul 1 - Nov 6, 14

Balance

Ordinary Income/Expense
Income
47200 Program Income
47230 Membership Dues

458,680.00

0.00

458,680.00

47240 Program Service Fees

0.00

0.00

0.00

47250 Reimbursement SPI Contract

0.00

9,281.00

-9,281.00

47260 Reimburesment VE Contract

0.00

0.00

0.00

47200 Program Income - Other

0.00

0.00

0.00

Total 47200 Program Income

458,680.00

9,281.00

449,399.00

Fund Balance Carry Over

0.00

121,000.00

121,000.00

200,000.00

120,037.35

-79,962.65

658,680.00

250,318.35

490,436.35

60901 Clerk of the Board

24,000.00

24,000.00

0.00

60902 Executive Director

49900 (Carry Over from FY 13-14 VE Study)

Total Income

Expense
60900 Administration and Clerical

94,680.00

0.00

94,680.00

60903 Principal Offc of the Authority

5,000.00

0.00

5,000.00

60904 Financial Services

6,000.00

6,000.00

0.00

500.00

0.00

500.00

0.00

0.00

0.00

130,180.00

30,000.00

100,180.00

63,000.00

10,000.00

53,000.00

152,000.00

4,697.28

147,302.72

0.00

0.00

0.00

215,000.00

14,697.28

200,302.72

35,000.00

1,558.33

33,441.67

200,000.00

95,795.14

104,204.86

6,000.00

0.00

6,000.00

62803 Televised Meeting

10,000.00

1,450.00

8,550.00

62804 Contract Services & Studies

30,000.00

0.00

30,000.00

62805 Contract SPI

0.00

0.00

0.00

62800 Contract Services - Other

0.00

0.00

0.00

281,000.00

98,803.47

182,196.53

65000 Insurance

7,500.00

6,681.95

818.05

65100 Travel Expenses

5,000.00

0.00

5,000.00

0.00

0.00

0.00

20,000.00

0.00

20,000.00

60905 Misc Admin Expenses

60900 Administration and Clerical - Other
Total 60900 Administration and Clerical

62100 Legal Fees

62110 Board Counsel
62140 Special Counsel
62100 Legal Fees - Other
Total 62100 Legal Fees

62800 Contract Services

60801 Public Outreach
60806 Contract VE
62802 Audit Services

Total 62800 Contract Services

66000 Payroll Expenses

68300 Contingency

Page 1 of 2

2:08 PM
11/06/14
Accrual Basis

Monterey Peninsula Regional Water Authority

Budget Status
July 1 through November 6, 2014
Budget

Total Expense

Net Ordinary Income

Jul 1 - Nov 6, 14

Balance

658,680.00

150,182.70

25,818.05

0.00

100,135.65

100,135.65

0.00

1.65

1.65

0.00

1.65

1.65

0.00

0.00

0.00

0.00

0.00

0.00

0.00

1.65

1.65

0.00

100,137.30

100,137.30

Other Income/Expense
Other Income
47220 Interest Earned
Total Other Income

Other Expense
80000 Ask My Accountant
Total Other Expense

Net Other Income

Net Income

Page 2 of 2

Monterey Peninsula Regional Water Authority

Agenda Report

FROM:

Date: November 13, 2014

Item No: 3.

Executive Director Cullem

SUBJECT: Adopt A Resolution, Approving Donald G. Freeman as Legal Counsel

through December 31, 2015 and Authorizing the Authority President to Execute a
Contract Extension with Perry and Freeman at A Price not-to-exceed $63,000.
RECOMMENDATION:
It is recommended that the Monterey Peninsula Regional Water Authority (MPRWA)
adopt a Resolution approving Donald G. Freeman as legal counsel through December
31, 2015 and authorizing the Authority President to execute a contract extension with
Perry and Freeman at a price not-to-exceed $63,000.
DISCUSSION:
Following a formal Request for Qualifications (RFQ) for legal services for the Water
Authority conducted during August and September 2012, an Ad-Hoc committee of the
MPRWA recommended selection of Perry and Freeman (Donald G. Freeman). On
September 27, 2012, the Water Authority adopted a resolution selecting Donald G.
Freeman to be legal counsel. On December 10, 2012, Donald G. Freeman provided the
Water Authority with waivers of conflict of interest from all other participating
jurisdictions to which he has professional, contractual obligations.
Due to Donald G. Freeman's extensive knowledge of the water supply issues that the
Water Authority has dealt with the last two years, and in light of his excellent
performance in the position of Authority Counsel, the Executive Director recommends
the Authority maintains continuity with Donald G. Freeman, at least through 31
December 2015.
The adopted budget for FY 2014-15 includes $63,000 for Legal Counsel which should
be adequate for services through June 30, 2015, by which time a new budget for FY
2015-16 will have been adopted.
The draft Resolution approves an extension of Donald G. Freeman as Authority legal
counsel through December 31, 2015 and authorizing the Authority President to execute
a contract extension accordingly.
ATTACHMENTS:
Draft Resolution and Draft Contract Extension for Legal Services

MPRWA RESOLUTION NO. 2014-XX

A RESOLUTION OF THE MONTEREY PENINSULA REGIONAL WATER AUTHORITY

ACKNOWLEDGING DONALD G. FREEMAN AS LEGAL COUNSEL FOR THE MONTEREY
PENINSULA REGIONAL WATER AUTHORITY AND AUTHORIZING THE PRESIDENT TO
EXTEND A CONSENT AND WAIVER OF CONFLICT OF INTEREST

WHEREAS, Donald G. Freeman has been requested to continue to represent the

Monterey Peninsula Regional Water Authority (MPRWA);
WHEREAS, Donald G. Freeman is currently the City Attorney for the City of Seaside and
the City of Carmel-by-the-Sea;
WHEREAS, Donald G. Freeman and MPRWA recognize the potential conflict of interest
which may arise as a result of Donald G. Freemans legal representation of MPRWA, City of
Seaside, and the City of Carmel-by-the-Sea;
WHEREAS, MPRWA wishes to acknowledge Donald G. Freeman as legal counsel for
MPRWA;
WHEREAS, the President of MPRWA and members of the MPRWA Board of Directors
have reviewed a letter from Donald G. Freeman dated November 20, 2012, indicating that Mr.
Freeman does not believe that his legal services for the Monterey Peninsula Regional Water
Authority will have any impact on his full and effective representation of each party, and does
not believe he has knowledge of any confidential information from any party which would be
material or relevant to his representation of MPRWA, the City of Seaside, and the City of
Carmel-by-the-Sea;
WHEREAS, Donald G. Freeman recognizes that by concurrently representing the
MPRWA, the City of Seaside, and the City of Carmel-by-the-Sea an issue of divided loyalty,
such as in litigation, could possibly arise at some future date, and that at that time it could be
necessary for him to make full disclosure to all parties, could be subject to disqualification from
representing any party, and at such time it would be necessary for each party to seek
independent legal counsel;
WHEREAS, the City of Carmel-by-the-Sea and the City of Seaside have passed their
respective Resolutions and their respective Mayors have executed the Consent and Waiver of
Conflict of Interest;
WHEREAS, the President and Board of Directors have reviewed this request with
independent legal counsel;
WHEREAS, according to Rule 3-310 of the California Rules of Professional Conduct
applicable to California lawyers which requires informed written consent of all represented
parties because of concurrent representation, MPRWA recognizes that Donald G. Freeman is
the City Attorney for the City of Seaside, and for the City of Carmel-by-the-Sea;
WHEREAS, the Board of Directors has been fully satisfied with the performance of
Donald G. Freeman during the period of his tenure as Authority legal Counsel between

September 27, 2012 and the present;

WHEREAS, due to the critical nature of on-going legal activities associated with the
CPUC consideration of the California American Water application for the Monterey Peninsula
Water Project, the Board of Directors finds that the public interest is better served by renewing
Donald G. Freemans contract at this time than to re-advertise a request for proposal for legal
services and;
WHEREAS Board of Directors wishes to authorize the President to extend a Consent
and Waiver of Conflict of Interest, and hereby acknowledges Donald G. Freeman as legal
counsel for the Monterey Peninsula Regional Water Authority until December 31, 2015.
NOW, THEREFORE, BE IT RESOLVED, that the President of MPRWA is hereby
authorized to extend on behalf of MPRWA a Consent and Waiver of Conflict of Interest thereby
acknowledging Donald G. Freeman as legal counsel for the Monterey Peninsula Regional Water
Authority and authorizes the President to execute a contract extension with Perry and Freeman
for legal counsel services.
PASSED AND ADOPTED BY THE MONTEREY PENINSULA REGIONAL WATER
AUTHORITY this ____day of ____ 201___, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:

0
0
0
0

DIRECTORS:
DIRECTORS:
DIRECTORS:
DIRECTORS:
APPROVED:

ATTEST:
Jason Burnett, President

Clerk to the Authority

EMPLOYMENTAGREEMENT FOR LEGAL SERVICES

by and
between the MONTEREY PENINSULA REGIONAL WATER"AUTHORITY, hereinafter
is. 'O \ day of
THIS AGREEMENT, made and entered into this

"MPRWA", and the LAW OFFICES of PERRY and FREEMAN hereinafter referred to as
"Attorney", both of whichunderstandas follows:
A.
Term: The term ofthis Agreement shall be for one (1) year commencing December
31, 2013, and shall terminate on December 31, 2014, unless terminated pursuant to paragraph H. of
this Agreement.

B.
Compensation. Attorney will provide ordinary legal services to MPRWA at a
monthly retainer of $2500. Extraordinary legal services will be billed at $350 per hour. Total billings
for legal services are not-to-exceed$60,000 for Fiscal Year 2013-2014
C.
Billing and Reimbursement of Costs. An accountingof services and hours will be
provided to MPRWA on a monthly basis. Attorney shall be reimbursed for actual out-of-pocket
expenses and costs advanced or paid on behalf of the MPRWA, including court reporter fees and
charges, court costs, and costs of outside investigators or experts pertaining to MPRWA litigation.
Travel to conduct MPRWArelated businessexpenses shall be billed asactual out-of-pocket costs
unless otherwise negotiated. There will be no charge for actual travel time.
.

D.
Ordinary Services. Legal advice and legal opinions to MPRWA as outlined in the
Amendment to Agreement for Legal Services dated 14 December 2012 (Exhibit A to this
Agreement) and Attorney Standard Terms and Conditions (Exhibit B to this Agreement).
E.

Extraordinary Legal Services. Preparation ofcomplex legal documents, representing

MPRWA in court appearances, litigation, or in proceedings before other public or administrative

bodies, or legal services provided to anyindependent or separate agency or entity ofgovernment not
operated as an integral part of MPRWA.

F.
Miscellaneous. MPRWArecognizesthatAttorney is a private lawpracticecurrently
located in Carmel-By-The-Sea, California, and will retain that office as its principal place of
business. Inaddition,MPRWArecognizesAttorney alsorepresentsandadvisesotherpublicentities

upon request. Attorney will submit conflict waivers to MPRWA whenever such potential arise
during the term of this contract.
G.

Association of Special Legal Counsel. MPRWA and Attorney recognize, that from

time to time, it may become necessary to associate with special legal counsel for matters involving
litigation, labor negotiations, worker's compensation personnel or bond issue proceedings and other
matters where either MPRWA Board of Directors or Attorney feel effective representation requires
special legal counsel.

H.

Termination. Eitherparty may terminate this Agreement without cause by providing

written notice to the other party in the manner set forth in item I. of this Agreement at least 30 days
prior to the effective date of termination.
I.

Notices. All notices herein provided to be given, or which may be given by either

party to the other, shall be considered fully received when made in writing and deposited in the
United States mail, certified andpostage prepaid, and addressed to the respective parties asfollows:
MPRWA:

ATTORNEY:

President, Board of Directors

Donald G. Freeman

Monterey Peninsula Regional

Water Authority
580 Pacific Street

Perry and Freeman

PO Box 805

Carmel By-The-Sea, CA 93921

Monterey, CA 93940
J.

Immunity. As an authorized representative ofMPRWA, Attorney shall be recognized

ashaving rights to any immunity MPRWAis entitled to. In no event shall any duties contained in
this Agreement, or otherwise herein, negate any legal protections or immunities available to the
parties under local, state or federal law.
W WITNESS WHEREOF, MPRWA has caused this agreement to be signed and executed on

its behalfby its President, and duly attested by its Clerk; andthe Attorney has signedandexecuted
this agreement in duplicate originalsthe day andyear first hereinabovewritten.
MPRWA

<9L^^e-^
Chuck Della Sala, President
ATTORNEY:

Donald G. Freeman

Monterey Peninsula Regional Water Authority

Agenda Report

FROM:

Date: November 13, 2014

Item No: 4.

Executive Director Cullem

SUBJECT: Adopt A Resolution Approving Brownstein Hyatt Farber Schreck as Special

Legal Counsel through December 31, 2015 and Authorize the Authority
President to Execute a Contract Extension at a Price not-to-Exceed
$152,000.
RECOMMENDATION:
It is recommended that the Monterey Peninsula Regional Water Authority (MPRWA)
adopt a resolution approving Brownstein Hyatt Farber Schreck, LLP as Special Legal
Counsel for the period January 1, 2015 through December 31, 2015 and authorize the
Authority President to execute a contract with Brownstein at the current hourly rates and
a total contract price not-to-exceed $152,000.
DISCUSSION:
In March 2012, The Authority negotiated an agreement for Attorney of Record services
with Brownstein. The firm provided special expertise in water law, at a reduced rate, in
support of Water Authority formation and activities.
For reasons outlined in the staff report on the subject at the Water Authority meeting of
Jan 9, 2014, the Authority extended the Brownstein agreement to December 31, 2014.
The CPUC process, as well as negotiations with the State Water Resources Control
Board on the Cease and Desist Order, will continue to require a substantial amount of
legal work in 2015. To insure continuity in Special Legal Counsel services, the
Executive Director recommends the Authority extend the contract with Brownstein
through 31 December 2015.
BUDGET CONSIDERATIONS:
In the approved budget for FY 2014-2015 the Water Authority authorized an
expenditure for Special Legal Counsel not-to-exceed $152,000.
ATTACHMENTS:
Draft Resolution
Contract Extension for Special Legal Counsel Services

DRAFT-Nov 13, 2014

EMPLOYMENT AGREEMENT FOR LEGAL SERVICES

THIS AGREEMENT, made and entered into this ___ day of _____________, 2014, by
and between the MONTEREY PENINSULA REGIONAL WATER AUTHORITY, hereinafter
MPRWA, and the LAW OFFICES of BROWNSTEIN HYATT FARBER SCHRECK, LLP,
hereinafter referred to as "Attorney", both of which understand as follows:
A.
Term: The term of this Agreement shall be for one (1) year commencing January
1, 2015, and shall terminate on December 31, 2015, unless terminated pursuant to paragraph H.
of this Agreement.
B.
Compensation. Attorney will provide legal services to MPRWA at an average
rate of no more than $350.00 per hour.
C.
Billing and Reimbursement of Costs. An accounting of services and hours will be
provided to MPRWA on a monthly basis. Attorney shall be reimbursed for actual out-of-pocket
expenses and costs advanced or paid on behalf of the MPRWA, including court reporter fees and
charges, court costs, and costs of outside investigators or experts pertaining to MPRWA
litigation. Travel to conduct MPRWA related business expenses shall be billed as actual out-ofpocket costs unless otherwise negotiated. There will be no charge for actual travel time.
D.
Budget. Attorney will not accrue costs for legal services in excess of $152,000
between January 1, 2015 and December 31, 2015 and in without prior approval of the Authority
Executive Director.
E.
Ordinary Services. Legal advice and legal opinions to MPRWA as outlined in the
Amendment to Agreement for Legal Services dated December 5, 2013 (Exhibit A to this
Agreement) and Brownstein Hyatt Farber Schreck, LLP Standard Terms and Conditions (Exhibit
B to this Agreement).

F.
Miscellaneous. MPRWA recognizes that Attorney is a private law practice
currently located in Santa Barbara, California, and will retain that office as its principal place of
business. In addition, MPRWA recognizes Attorney also represents and advises other public
entities upon request. Attorney will submit conflict waivers to MPRWA whenever such
potential arise during the term of this contract.

G.
Termination. Either party may terminate this Agreement without cause by
providing written notice to the other party in the manner set forth in item I. of this Agreement at
least 30 days prior to the effective date of termination.
H.

Notices. All notices herein provided to be given, or which may be given by either

party to the other, shall be considered fully received when made in writing and deposited in the
United States mail, certified and postage prepaid, and addressed to the respective parties as
follows:
MPRWA:
President, Board of Directors
Monterey Peninsula Regional
LLP
Water Authority
580 Pacific Street
Monterey, CA 93940

ATTORNEY:
Russell M. McGlothlin
BROWNSTEIN HYATT FARBER SCHRECK,
21 East Carrillo Street
Santa Barbara, CA 93101

I.
Immunity. As an authorized representative of MPRWA, Attorney shall be
recognized as having rights to any immunity MPRWA is entitled to. In no event shall any duties
contained in this Agreement, or otherwise herein, negate any legal protections or immunities
available to the parties under local, state or federal law.
IN WITNESS WHEREOF, MPRWA has caused this agreement to be signed and
executed on its behalf by its President, and duly attested by its Clerk; and the Attorney has
signed and executed this agreement in duplicate originals the day and year first hereinabove
written.
MPRWA
____________________________
Jason Burnett, President
ATTORNEY:
ATTEST:
_____________________
Russell M. McGlothlin

_________________________
Clerk of the Board

Monterey Peninsula Regional Water Authority

Agenda Report

FROM:

Date: November 13, 2014

Item No: 5.

Executive Director Cullem

SUBJECT: Approve Extension of Deadline for Fiscal Year 2013-14 Financial Report
and Full Opinion Audit to December 31, 2014, and Authorize a Time
Extension of The Contract with McGilloway, Ray, Brown and Kaufman to
March 31, 2015.
RECOMMENDATION:
It is recommended that the MPRWA approve an extension of deadline for Fiscal Year
2013-14 Financial Report and Full Opinion Audit to December 31, 2014, and authorize a
time extension of the contract with McGilloway, Ray, Brown and Kaufman to March 31,
2015.
DISCUSSION:
Following an informal solicitation for proposals in May 2013, the Executive Director
selected McGilloway, Ray, Brown and Kaufman for the Water Authority audit. The
contract was executed on October 31, 2013. At its meeting of November 14, 2013, the
Water Authority extended the deadline for audit completion to December 31, 2013
which was met by the auditing firm. At its meeting of February 13, 2014, the Authority
received a formal presentation of the FY 2012-2013 audit and extended the McGilloway,
Ray Brown, Kaufman contract to conduct the FY 2013-14 audit.
Pursuant to Article 6 of the JPA, the audit and annual report are due December 1, 2014.
Due to changes in our accounting procedures and accounting staff this past year, the
Executive Director is again requesting an extension of the deadline for completion of the
audit and annual reports to December 31, 2014.
In addition, an extension of the contract completion date from December 31, 2014 to
March 31, 2015 will give us room for any unanticipated audit follow-up after the reports
have been completed.

ATTACHMENTS:
McGilloway, Ray, Brown and Kaufman contract dated October 31, 2013.

06/12

Monterey Peninsula Regional Water Authority

Agenda Report

FROM:

Date: November 13, 2014

Item No: 6.

Executive Director Cullem

SUBJECT: Receive Report, Discuss, and Provide Direction on the Meeting with
SWRCB staff on Nov 7, 2014

DISCUSSION:
There is no written report for this item. A verbal report regarding the State Water
Resources Control Board Staff Meeting will be presented at the Authority meeting.

06/12

Monterey Peninsula Regional Water Authority

Agenda Report

FROM:

Date: November 13, 2014

Item No: 7.

Executive Director Cullem

SUBJECT: Receive Report, Discuss, and Provide Direction on the Coastal

Commission Decision on the Test Slant Well CDP at its Meeting on
November 12, 2014.
DISCUSSION:
There is no written report for this item. A verbal report on the Coastal Development
Permit (CDP) will be presented at the meeting.

06/12

Monterey Peninsula Regional Water Authority

Agenda Report

FROM:

Date: November 13, 2014

Item No: 8.

Executive Director Cullem

SUBJECT: Receive Report, Discuss, and Provide Direction to Staff on Crediting FY

2013-14 Year-End Budget Surpluses to Contributing Cities.
RECOMMENDATION:
It is recommended that the MPRWA receive an update on the budget surplus from FY
2013-2014 and authorize a return of excess contributions to the Cities.
DISCUSSION:
At its meeting of April 25, 2013, the Water Authority adopted a budget of $423,680 for
Fiscal Year 2013-2014. Due to a slowdown in the CPUC process for the Monterey
Peninsula Water Supply Project as a consequence of delays in required permits and
approvals, expenses for Special Counsel were substantially less than expected.
In addition, a reduction in the number of regular Water Authority meetings from 2 per
month to 1 per month resulted in significant savings in administration and staff salaries.
Finally, a $83,300 contribution from the County that had been approved in September
2012 was received in FY 2013-14.
A total budget surplus of approximately $121,000 is available for return to the Cities.
Article 13 of the Joint Exercise of Powers Agreement (JPA) authorizes the Board to
return unneeded contributions in direct proportion to the contributions made. Staff
recommends that the contributions be returned as credits against requested
contributions for FY 2014-15.
FISCAL IMPACT:
The credit to each City using the contribution formula previously approved by the Water
Authority is as follows:
Carmel-by-the-Sea
Sand City
City of Pacific Grove
City of Seaside
City of Monterey
City of Del Rey Oaks

06/12

@ 9.3%
@ 1.3%
@ 18.80%
@ 22.00%
@ 46.50%
@ 2.10%

=
=
=
=
=
=

$ 11,253
$ 1,573
$ 22,748
$ 26,620
$ 56,265
$ 2,541