Below are Frequently Asked questions that may help you understand some of the dynamics of the current water situation, such as:
- Who is the Water Authority?
- Why do we have a water problem?
- What is the “Cliff” we’ve been hearing about?
- What is the timeline for the projects within the water portfolio?
- How much water will be produced?
- What will happen since none of these projects are scheduled to be completed in time to prevent rationing?
- Why does the Authority support the Cal Am desal project?
- What is the Groundwater Replenishment (GWR) Project and who is involved?
- How much should I expect my water bill to increase?
- What is being done to keep the cost of water down for Monterey Peninsula residents?
- What are the economic effects of not finding new water sources before the January 1, 2017 Cease & Desist Order?
Who is the Water Authority?
The Monterey Peninsula Water Authority was formed in January 2012 with the goal of finding a timely water solution for the Monterey Peninsula that is in the best interests of the rate payers. The Directors of the Authority are the mayors from six Peninsula cities: Carmel-by-the-Sea, Del Rey Oaks, Monterey, Pacific Grove, Sand City and Seaside. Monterey County also participates on the Governance Committee to represent approximately 1/3 of residents who live in the unincorporated part of the county. The Water Authority is responsible for many accomplishments and agreements bringing us every closer to a water solution on the Peninsula. In pursuing a water solution, the Authority has worked closely with all stakeholders and has taken a portfolio approach that includes three main water sources. The Authority meets the second Thursday of every month at 7:00pm at the Monterey City Chambers and encourages the public to attend.
Why do we have a water problem?
The Monterey Peninsula has a history of chronic water shortage. Many still remember the moratorium and water rationing of the late 1970’s. In 1995, the state of California required reductions in our water use from the Carmel River. In 2006, a court reduced pumping from the Seaside aquifer, and in 2009, the state issued a cease-and-desist order imposing a deadline of Jan. 1, 2017, to significantly reduce water withdrawals from the Carmel River. Now we must find an alternative water supply or face severe water rationing again. This would have an extremely negative impact on our local economy and those living in the area.
What is the “Cliff” we’ve been hearing about?
The State Board’s Cease and Desist Order (CDO) requires Cal Am to stop most of its pumping from the Carmel River by January 1st, 2017. This is often referred to as the CDO “cliff.” It is broadly recognized that the community would face severe water rationing if we were required to meet the CDO “cliff” without new water supply projects.
Any request to modify the CDO “cliff” will need to have two elements. First, Cal Am and the community will need to be able to demonstrate that we are doing all we can to comply with the CDO. Second, mitigation measures will be needed to address continued pumping from the Carmel River.
What is the timeline for the projects within the water portfolio?
Currently, the GWR project, called Pure Water Monterey, is estimated to begin operations by the end of 2017. The desal plant, the size of which will depend on the success of the GWR project, is scheduled for completion mid-2018.
How much water will be produced?
All water projects will produce a combined total of approximately 15, 296 acre feet (AF) per year. This number includes the water needed for existing use, lots of record, an economic rebound allowance, and the Pebble Beach proposed Del Monte Forest.
What will happen since none of these projects are scheduled to be completed in time to prevent rationing?
Given the successful progress being made on Peninsula water projects, the Water Authority will request a one to two year extension to the Cease and Desist Order (CDO) with the California Public Utilities Commission (CPUC). The approval of this extension will largely depend on the continued progress on these water projects, which the Water Authority Directors are working hard to achieve.
The Authority’s current thinking is that we will want to ask the State Board for an amendment to the CDO “cliff” late this year or early next year and ask the State Board to act on that request within a year. This timeline will allow us to continue to demonstrate progress on the water projects over the next 18 months prior to the State Board action. We will continue to actively seek both a CPCN from the CPUC and a Coastal Development Permit from the Coastal Commission within this 18-month period.
Why does the Authority support the Cal Am desal project?
The Authority recognizes that in order to fulfill our water needs, desal has to be part of the project portfolio. We have four project criteria for any proposed water project, and of the desal project, Cal Am comes closest to achieving those. It is also the only proposed desal project that has the financing and capacity to deliver a desal project close to our deadline. Therefore, to address concerns over the Cal Am desal project, a diverse group of stakeholders met and developed eight requirements Cal Am must address in its project. This agreement was signed by 15 parties, including environmental advocates, Peninsula business interests, community organizations, Salinas Valley agricultural representatives and Cal Am. One of these requirements was for Cal Am to accept public funding for the project, lowering its equity to 27% and saving rate payers tens of millions of dollars.
What is the Groundwater Replenishment (GWR) Project and who is involved?
The GWR project, called Pure Water Monterey, is a joint project between the Monterey Peninsula Water Management District (MPWMD) and the Monterey Regional Water Pollution Control Agency (MRWPCA), in partnership with Cal Am. A GWR replenishment project would recharge the Seaside groundwater basin by injecting high quality purified water. The project is sustainable, drought-resistant and would improve and protect drinking water supplies. It also diversifies the community’s water supply portfolio for a more secure water supply.
How much should I expect my water bill to increase?
While there have been many numbers thrown by differing groups, the consensus by the Authority, the Water District and Cal Am is that rate payers’ water bills will increase by an estimated 41% by 2018, when it will level out except for general rate increases.
What is being done to keep the cost of water down for Monterey Peninsula residents?
The Authority is constantly working in the best interests of the rate payers. For any water project to be supported by the Authority, it must first be transparent in process and accountability and economically competitive. The projects included in the Authority’s portfolio approach achieve those standards. To ensure ongoing transparency and public involvement in the process, Governance and Technical Advisory Committees were created. Through these arrangements, the Authority was represented in the negotiations and RFP process as Cal Am selected its Design-Build Firm, CDM Smith. The Authority will also facilitate the value engineering consultant who will review the desal plans to maximize efficiencies and potentially find other cost saving measures. However, potentially the greatest cost savings to rate payers comes as an outcome from the July 2013 Settlement Agreement between the Authority and 15 other parties: Cal Am agreed to reduce its equity (investor funds) from 53% to 27%, to be replaced by public financing (State bonds and state loans). This will save rate payers approximately $125 million in lifetime savings ($79 million present value savings).
What are the economic effects of not finding new water sources before the January 1, 2017 Cease & Desist Order?
Water is crucial for the local economy. Agriculture and tourism- our two largest employers- both rely on water for their business. And therefore, we rely on water for those jobs. In fact, estimates project that our economy will lose more than $1 billion a year if the Peninsula loses just half of its current water supply. This includes 6,000 lost jobs, $461 million per year in lost industrial production such as food, and an estimated $742 million annual loss in commercial sales from hotels, restaurants and grocery stores. It is critical that we work together to continue the progress on our water projects.