M I N U TE S

MONTEREY PENINSULA REGIONAL WATER AUTHORITY (MPRWA)

Director's Meeting
7:00 PM, Thursday, January 11, 2018
COUNCIL CHAMBERS
580 PACIFIC STREET, MONTEREY
MONTEREY, CALIFORNIA

Directors Present: Director Carbone, Director Dallas, Director Edelen, Director Rubio, Alternate
Director Smith, President Kampe
Directors Absent: Director Roberson

Staff Present: Executive Director Cullem, Legal Counsel Freeman, Clerk Romero

CALL TO ORDER

President Kampe called the meeting to order at 7:00 p.m.

ROLL CALL

All Directors present, with Alternate Director Smith filling in for Director Roberson.

PLEDGE OF ALLEGIANCE

REPORTS FROM BOARD DIRECTORS AND STAFF

PUBLIC COMMENTS

• Tom Rowley, Monterey Peninsula Taxpayers Association (MPTA), encouraged the

Authority to keep up the good work.

CONSENT AGENDA

Executive Director Cullem requested that consent agenda items #2 and #4, approval of
minutes, be continued. He gave administrative edits to the audit report for consent item #6, on
pages 23 and 24. Director Smith gave administrative edits to audit report page 16, stating that
the percentage in bullet point 4 is incorrect. He abstained from voting on items #1 and #3,
approval of minutes, since he was not present for those meetings.

On a motion by Director Rubio, seconded by Director Carbone, and carried by the following
vote, the Monterey Peninsula Regional Water Authority Approved the Consent Agenda items
#1, and #6, with edits made to item #6, and continued items #2 and #4:

AYES: 6 DIRECTORS: Carbone, Dallas, Edelen, Rubio, Smith, Kampe

NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None
 MPRWA Minutes Thursday, January 11, 2018

On a motion by Director Rubio, seconded by Director Carbone, and carried by the following
vote, the Monterey Peninsula Regional Water Authority Approved the Consent Agenda items
#3, and #5, with Member Smith abstaining:

AYES: 5 DIRECTORS: Carbone, Dallas, Edelen, Rubio, Kampe

NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 1 DIRECTORS: Smith
RECUSED: 0 DIRECTORS: None

1. Approve Minutes from June 22, 2017

Action: Approved 5-0-0-1 (Smith abstained)

2. Approve Minutes from September 18, 2017

Action: Continued

3. Approve Minutes from November 11, 2017

Action: Approved 5-0-0-1 (Smith abstained)

4. Approve Minutes from December 14, 2017

Action: Continued

5. Approve and File Authority Checks Through December 31, 2017

Action: Approved

6. Receive the Audit Report for FY 2016-2017 and Authorize an Extension of the Audit Contract
with McGilloway, Ray, Brown, & Kaufman for FY 2017-2018 and FY 2018-2019
Action: Received report, noted administrative corrections

***End of Consent Agenda***

AGENDA ITEMS

7. Receive an Update on the Summary Project Schedule for the Monterey Peninsula Water
Supply Project, Status of Test Well Operation and Pipeline Construction
Action: Received report

Chris Cook, California American Water (Cal Am) Engineer, gave an update on the Monterey
Peninsula Water Supply Project (MPWSP), the status of the test well operation and pipeline
construction. He answered questions of the board.

Monterey Peninsula Regional Water Authority

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8. Receive Report, Discuss, and Provided Direction on Issues Being Discussed at the Settlement
Meetings
Action: Received report; discussed; Authorized Special Legal Counsel, Authority
President and Vice President to draft a response to the motion letter and submit to the
ALJ

Russ McGlothlin phoned in via speakerphone and reported that there have been two recent
settlement party meetings with Dr. Marci DuPraw as facilitator, and part of the discussion was
to provide an update to the Administrative Law Judge (ALJ) who requested more info on Pure
Water Monterey (PWM) expansion. Executive Director Cullem said that staff needs direction
from the Authority on what the response to the motion should say. He added that the packet
includes a letter from Mayor of Salinas Joe Gunter saying there is no more water available from
Salinas Valley Basin.

President Kampe said during the discussions there was focus on the desal plant, and out of
that there was hopeful progress on how to reconcile differences, particularly around the aquifer
in Marina. He added that the next meeting is January 25th and that so far the scope of the
discussions has been far more specific than in the past. He also said that he was invited to go
to Marina and engage with them which is an important step to build bridges with MCWD.

Director Rubio reported that he attended the settlement meeting and the Cal Am project is
staying on its track. He voiced concern about the short time frame for the settling parties to
come to an agreement and isn't sure that some participants are willing to take the leap.

Russ McGlothlin echoed Director Rubio's concerns about uncertainty of coming to an

agreement with all parties. He said to keep in mind that this process needs to happen, whether
it’s now or later, and if the CPCN is issued as anticipated in the Spring then it’s best to have
these discussions. He said mini breakthroughs were being made at meetings and he remains
cautiously optimistic.

PUBLIC COMMENT:

• George Riley, Public Water Now (PWN), said the settling parties seem willing to discuss
problems with litigation and set up some procedural options in the short term to deal
with conflicts. He added the conversation reflected time demands, the CDO, milestones,
and getting the whole picture on the page. He said that outsider influences may become
a factor, such as the letter from the Mayor of Salinas.

• Tom Rowley, MPTA, questioned if hiring a facilitator was money well spent.

• Fred Meuer, gave comment on community infrastructure and the ability to sustain with
the role with BRAC in this area. He said any effort to delay or downsize the desal plant
is a major threat to the community and the closure of BRAC. He added that the portfolio
approach is the best option, and gave the Board a written copy of his statement.

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 MPRWA Minutes Thursday, January 11, 2018

• Norm Groot, Monterey County Farm Bureau, said he was frustrated during the
settlement meetings he senses that not everyone has come to the table with willingness
to compromise. He said the portfolio approach is still the best approach. He added that
the while the Salinas basin has done their part on working on water shortage issues, the
Peninsula has not, and there is a loss of a common goal for a long term solution.

President Kampe noted that Mayor Joe Gunter's letter is a factor to consider, and he and Don
Freeman feel that the facilitator is money well spent and seems to be developing a process in a
timely fashion. Director Smith commented in response to Mr. Meuer’s comment that resiliency
and having long term resources on the Peninsula is crucial to keeping BRAC in the area.

Director Rubio said the Authority need to be specific in language for the motion on the direction
for settlement meetings. Mr. McGlothlin said that the motion can be filed individually or jointly
with Cal Am’s attorney, and either way will emphasize that any proceeding at the PUC must not
compromise compliance with the milestones. He added that the draft motion in the packet has
already been filed by other settling parties and he suggests that the Authority reply to it and
highlight to the ALJ that any further evidentiary meetings do not cause a delay to the project.
He said he can draft a reply and have it ready by early next week, and will have it focus on the
two main issues. Don recommended that the Authority authorize Russ to write the reply to the
motion and have the President and Vice President approve it before filing.

Director Dallas requested that the Authority to draft their own response to the motion apart from
Cal Am.

Director Rubio made a motion that he and President Kampe authorize and approve a reply
letter to the ALJ.

Director Edlen seconded the motion. Director Smith clarified that the motion is to have Russ
draft a reply to the ALJ saying that the portfolio is still the project, including a desal plant as the
long term project in the portfolio.

On a motion by Director Rubio, seconded by Director Edelen, and carried by the following vote,
the Monterey Peninsula Regional Water Authority Authorized Russ McGlothlin to draft a
response letter to the ALJ and have President Kampe and Vice President Rubio approve it
before submitting:
AYES: 6 DIRECTORS: Carbone, Dallas, Edelen, Rubio, Smith, Kampe
NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None

9. Receive Report, Discuss, and Approve an Increase in the FY 2017-2018 Budget to Provide for
Additional Special Counsel Services and Technical Support Services and Authorize Utilization
of Not-to-Exceed $40,000 from the Reserve Account
Action: Authorized $40,000 increase in the FY 2017-18 budget from the reserve account
for additional special counsel and technical support services

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MPRWA Minutes Thursday, January 11, 2018

Executive Director Cullem requested that the Authority approve additional funding for special
legal counsel up to $30,000 from the reserve account to pay for special legal counsel costs to
get through June 2018 and/or additional technical support from Geosyntec if additional scientific
studies or analysis are needed as part of the settlement process. Russ McGlothlin reminded the
board that the settlement meetings were not part of his original budget estimate for FY2017-18,
and has evolved. He added that the last 3 years his services have been under budget.

PUBLIC COMMENT:

None

The board members agreed that any funds used for Russ McGlothlin’s services is money well
spent, and since funding is available decided it’s best to remain prepared to move the desal
project forward.

On a motion by Director Smith, seconded by Director Edelen, and carried by the following vote,
the Monterey Peninsula Regional Water Authority Approved a FY2017-18 Budget Adjustment to
Provide for Additional Special Counsel Services and Technical Support Services and Authorize
Utilization of Not-to-Exceed $40,000 from the Reserve Account:
AYES: 6 DIRECTORS: Carbone, Dallas, Edelen, Rubio, Smith, Kampe
NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None

ADJOURNMENT

ATTEST:

Nova Romero, Clerk of the Authority MPRWA President

Monterey Peninsula Regional Water Authority

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