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It was somewhat encouraging watching the National Geographic documentary, “Water and Power: A California Heist,” and that’s because it showed that water politics throughout California are as messy as they are right here on the Monterey Peninsula. What with the decades of unproductive sparring over solving our water supply problem and with the rapidly escalating cost of tap water hereabouts, I had started thinking that maybe we were alone in our inability to fix anything.  I was thinking maybe it was something in the water.

The focus of the documentary, produced by Marina Zenovich with able assistance from author and investigative reporter Mark Arax, was the manipulation of groundwater rights and some remarkable profiteering that is going on, principally in the San Joaquin Valley but also just down the coast in San Luis Obispo County.

Which points me toward the purpose of this piece, a June 3 forum on new groundwater rules and what they mean to us in Monterey County. More specifically, it will focus on California’s long-delayed but hugely important effort to begin actually regulating groundwater instead of simply letting the fellow with the deepest well call the shots.

The speakers will be Tom Moore, vice president of the Marina Coast Water District board of directors, and Keith Van Der Maaten, general manager of the district. It’s not just an academic topic for these two because the desalination plant that California American Water plans to build would draw some of its water from underground supplies theoretically controlled by Marina Coast.

The terribly long title of the forum is “To learn how the Sustainable Groundwater Management Act may affect your water bill, your access to water and what groundwater sustainability agencies mean to us locally.” Under state mandate, Monterey County has formed a groundwater sustainability agency, which naturally is dominated by agribusiness interests.

In previous Partisan posts, I have labeled Moore as my favorite local politician, largely because of his incredibly deep knowledge of the subject matter and his ability to explain it all to folks like you and me.

The forum is set for 7 p.m. Saturday June 3 at the Marina Public Library, 190 Seaside Ave., in Marina. It is sponsored by the Marina Democratic Club, the Monterey County Democratic Central Committee and Citizens for Just Water.

In case you’d like to printout a reminder, here’s the flyer for the event.

BTW, the National Geographic special is available for rent on Netflix.

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Proprietor’s note: Tom Moore, an exceptionally well qualified member of the Marina Coast Water District‘s board, posted the following as a response to a previous Partisan post regarding the wisdom of private v. public ownership, a subject of current interest because of a looming effort to put privately owned Cal Am water under public ownership. As it stands, the group Public Water Now is expected to sponsor a ballot measure that would require a public buyout of the water utility and put it under the management of the Monterey Peninsula Water Management District, which is governed by a board of elected officials.  Moore did not intend this to be a standalone commentary, but it deserves more attention than it would have received otherwise.

—-

Point 1: The vast majority of public sector organizations, for-profit organizations and non-profit organizations provide significant benefits for their clients and society, at a cost that is as reasonable as their physical, legal and market circumstances allow.

Point 2: If you insist on clinging to the myth that all government organizations are inefficient, inept and run by lazy, overpaid bureaucrats then:

a. You must notify your local fire and police departments, along with the county 911 Center that they must NEVER respond to a phone call or alarm from your home. You must also never accept medical treatment under any circumstances from Salinas Valley Memorial Hospital. To do otherwise makes you a hypocrite.

b. If you really insist on dueling over the issue, then: AIG, ENRON (“Smartest Guys in the Room”), Bernie Madoff, Wells Fargo Bank, IndyMac Bank, Washington Mutual Bank, Bethlehem Steel, White Star Lines (owners of the Titanic), Pan Am, Eastern Airlines, Drexel Burnham Lambert, Bank of Credit and Commerce International, Union Carbide (Bhopal killings), PG&E (recent San Bruno killings), Three Mile Island, Exxon Valdez. How many trillions of dollars were wasted and innocent people injured or killed by these “efficient” private companies?

Point 3: How much do you think Cal Am would charge its customers if it was not regulated by the CPUC and instead all its water rates were set at the sole discretion of the Cal Am Board of Directors?

Point 4: The CPUC regulatory process is arcane, complex, difficult, time consuming and, above all, expensive for everyone involved. Hundreds of thousands of dollars and years can be spent on a given Cal Am rate setting process. The CPUC exists only so that a private company can be in a line of business that must, of necessity, be a monopoly (such as a utility).

Point 5: Marina Coast Water District is a government organization. Its Board of Directors consists of five locally elected citizens who are paid all of $50 per month. This Board meets one to two times a month. All meetings are held locally, not in San Francisco or New Jersey. The public is even welcome to attend these meetings. (Just try to get into a Board meeting at Cal Am, if you can even find out where and when they are meeting….).

Point 6: Marina Coast is beholden ONLY to its customers and the local voters. There are no shareholders to keep happy and no stock price to worry about. By law Marina Coast rates contain no profit and MUST be reasonably related to the actual cost of providing water and wastewater services. When a new rate plan is developed, it is put together for the next 3-5 years. It takes only about four months to develop and approve such a rate plan. The cost of a new rate plan is less than $50,000, including consultants and staff time. And all Board deliberations on new rate plans are done locally and open to the public. The public even gets to weigh in on new rate plans via the Proposition 218 process. So who is the inefficient bureaucracy here: the government owned utility or the privately owned monopoly?

Point 7: Points 5 and 6 can be repeated (with a couple of slight adjustments) for the Monterey Regional Water Pollution Control Agency (MRWPCA). Note: with the cooperation and assistance of the Marina Coast Water District, the MRWPCA will soon be bringing the Cal Am service area 3,500 acre-feet per year of new water. This is the largest amount of new water for the Cal Am service area that has been developed in the past 22 years. And guess what? The MRWPCA is a government owned utility.

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Antique water fountain, detail of a source for drinking water, drinking water

Antique water fountain, detail of a source for drinking water, drinking water

Editor’s note: The following by Tom Moore of the Marina Coast Water District originally appeared as a response to a previous Partisan post about the advertising for the Sea Haven development, formerly Marina Heights, planned for Marina. It is reposted here to expose it to a wider audience.

Now that we’ve gotten out of our system the national politics associated with the “Coming Soon Marina Heights” development or whatever misleading marketing names they will come up with for it, let’s get back to water and why you should not worry/worry.

The Sea Haven/Marina Heights project, along with all of the former Fort Ord, is served by Marina Coast Water District (MCWD). While most of you know the following facts, they are included here for any new readers:

  • MCWD is a government organization, not a private company. As such it is prohibited from making a profit off its ratepayers.
  • MCWD has nothing to do with Cal Am or the Cal Am service area (unless you count the various suits filed by Cal Am against MCWD and MCWD’s countersuits against them as “having to do with”…).
  • MCWD owns outright all of the water service and wastewater collection infrastructure on the former Fort Ord and in Marina itself.
  • MCWD owns nearly 5,200 acre-feet per year (AFY) of the 6,600 AFY of groundwater pumping rights attached to the former Fort Ord (the U.S. Army owns the other approximately 1,400 AFY).
  • MCWD owns 2.2 million gallons per day (MGD) of wastewater treatment rights for the former Fort Ord (the Army owns the other 1.1 MGD).
  • By contract (with FORA), MCWD is honoring and will continue to honor FORA’s allocation of the 5,200 AFY of groundwater pumping rights to the underlying land use jurisdictions (Seaside, DRO, Marina, City of Monterey and Monterey County).
  • FORA long ago divvied up the 5,200 AFY and distributed portions to these land use jurisdictions (even though they do not actually own the rights themselves).
  • ALL of this groundwater comes from the Salinas Valley Groundwater Basin (SVGB). None of it comes from the Carmel River or Cal Am.

When the “Coming Soon Marina Heights” development proposal came to the city of Marina many years ago (under a different political regime) it got several sweet deals. The one that irked those of us keeping an eye on MCWD was that the city pretended that the development would use less water than MCWD engineers said the development would need. This occurred because the city wanted to entitle not only “Coming Soon Marina Heights” but also the Dunes development and Cypress Knolls. However, MCWD’s engineer told the city that there would most likely not be quite enough water in the city’s allocation of groundwater from FORA to build out all three developments.

Those of us who have been paying attention have noted that the full build-out of these various Ord Community developments (despite even the current rapid pace of construction) is many years away. So there is still time for MCWD to find and develop the additional relatively small amounts of water needed to support full build-out …. (OK, if you want to glom onto the “no worries” viewpoint you should stop reading here)… unless things go badly with our groundwater.

So how could things go badly with our groundwater? There are two broad possibilities:

1. If Cal Am succeeds in using the CEMEX property to obtain source water for the size of desal plant that it wants, Cal Am will be taking at least 27,000 AFY from a location a mere 1.8 miles from MCWD’s nearest potable water well and less than 1,800 feet from the location of the source water well for MCWD’s desal plant. This presents a serious potential threat to the groundwater south of the Salinas River where all of MCWD’s wells are located.

(For comparison purposes, MCWD currently pumps less than 4,000 AFY from its wells — thanks to water-conserving ratepayers in Marina and the Ord Community! However, MCWD has the right to pump more than a total of 10,000 AFY eventually. Just the Ord Community’s build out demand has been estimated at 9,000 AFY.)

2. The new groundwater sustainability act ends up forcing MCWD to forfeit some portion of its current total groundwater pumping rights. The whole point of the act was to make groundwater pumpers behave collectively in such a way as to sustain indefinitely the groundwater basins that serve them. Since the Salinas Valley Groundwater Basin has for decades been experiencing seawater intrusion, it is not currently in a sustainable condition. The consequence could be cutbacks in future pumping of groundwater.

And for those of you who may believe that we really don’t have a problem because we live next to the ocean and there is an infinite amount of water there, here is some more bad news. For the past 20 years or so, Cal Am has been proving that it’s not so easy to get source water from the ocean. If it was so easy, why aren’t they getting their source water from Monterey, Seaside or Sand City beachfronts? They could buy up a property in Sand City for the Cal Am desal plant itself and save a whole bunch of pipeline construction. For that matter, if it is so easy to get source water for a desal plant, why not get it from Carmel beachfront? They would avoid tens of millions of dollars of new pipelines through Monterey that are required under their current proposal.

The fact is that desal is NOT easy. Ratepayers don’t want to pay for it, some folks don’t want infrastructure on their pristine beach, regulatory agencies want to make sure the infrastructure causes as little harm as possible, the plants themselves are complicated to operate and maintain, the plants are expensive to build and very expensive to operate (salt and other stuff just doesn’t like to leave water – check the physics involved in the chemistry), the engineering is challenging and few people welcome the disposal of the brine output in their patch of sea. Oh, and did I mention that the ratepayers don’t want to pay for it.

All of these challenges have to be overcome to build a successful desal project that produces water. MCWD should know because it built and operated the first government-owned desal plant on the Central California coast. MCWD knows what these challenges were like and what kind of limitations they put on what is actually feasible. And the plant is currently mothballed precisely because it is too expensive to operate and maintain as long as we have access to groundwater at one tenth the cost.

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American Water Works, the parent of Cal Am Water, has two basic strategies for expanding its business. One is to expand into areas where development is expected. The other is to buy up small water services, those under 10,000 customers.

Both methods are in the works for Cal Am, the Monterey Peninsula’s principal water purveyor.

Cal Am has a long history of not adding supply infrastructure, from 1966 when it bought the Peninsula system, to 1996 when the State Water Board ordered it to change direction. Even after the California Public Utilities Commission added its recommendation in 2001 to build a desal facility at Moss Landing, Cal Am has worked at snail speed.

A “eureka moment” occurred, however, Cal Am realized that the future required new water to come from north of the Peninsula. Exciting visions of sugar plums began dancing in Cal Am’s head. Maybe all the cards were lining up, putting development at the former Fort Ord into play for Cal Am. After decades of neglecting the infrastructure, Cal Am now had a profitable game changer.

This explains everything. But for it to work, Cal Am would have to win legal battles and not simply meet engineering hurdles.

It had to play along with the Regional Desal Project in 2008-2010 because the CPUC, Cal Am’s regulator, had designed that process. But that venture was not to Cal Am’s liking. The CPUC had approved a project that was about 80% publicly owned, providing Cal Am with little ownership and infrastructure. That greatly limited its ability to collect profit. At the first opportunity, Cal Am and Monterey County’s government scuttled the project. They used conflict of interest charges to sink it.

Then Cal Am decided to pursue a fully corporate-owned and larger desalination project, which fit its profitable expansion strategy. It would be located near the former Fort Ord, the only part of the Peninsula with development potential. It would require Cal Am to overcome numerous legal hurdles.

The company first needed to overcome the county ordinance requiring public ownership of any desal facility. It got the county to cooperate and to get the CPUC and the State Water Board to lay the groundwork with quasi-legal opinions in support.

Soon, Cal Am’s primary consultant on the project was caught in a conflict of interest (Dennis Williams of Geoscience holds patents on slant well technology). The CPUC agreed that a conflict existed. But Cal Am skirted that issue by adding a legal non-revenue sharing agreement, Williams continues on the job with the potential to make millions even though a much less severe financial conflict of interest had sabotaged the Regional Desal Project.

Cal Am’s strategy shows up in various ways. Though the company initially promised the public and the permitting agencies that the intake for the current desal project would be under the bay, the intake is inland. This aggravates the legal challenge over water rights. Remember that Cal Am has no water rights for this project.

Being inland, the intake is smack in the seawater-intruded Salinas River Groundwater Basin (SRGB). The desal intake draws seawater inland, causing more seawater intrusion and legal problems. But Cal Am, of course, has a legal strategy for a “practical solution,” claiming a beneficial use of the largely abandoned intruded aquifer water. It is an innovative legal strategy that must overcome decades of court cases that conclude that overlying water rights holders have prevailing rights. The legal test is yet to come.

By pumping from the Salinas Basin, Cal Am is obliged to “return” source water taken from the intruded aquifers. This is the local law, the Agency Act, governing the basin.

There seems to be no great alarm about the continued high volume of Salinas Basin water in Cal Am’s test slant well samples. Why not? In my opinion, it is because the requirement to return water to the basin is being used to justify expanded infrastructure into new territory. Cal Am is credited with “success” by negotiating a breakthrough deal – the Peninsula and farmers agreed to the plan! But Castroville and the farmers got a great deal, paying less than 3 cents toward each dollar in costs. The difference of 97 cents will come from Peninsula ratepayers.

But the main point is not the cost. It is the infrastructure and rights Cal Am needs to implement the return water agreement. It will need to construct piping and pumping infrastructure in the area, and it will need obtain the authority to deliver potable water to Castroville. It will seek to be a water distributor right in the middle of the jurisdiction of another water purveyor, Marina Coast Water District (MCWD). Yes, it will be able to deliver potable water smack in the middle of another water service area and adjacent to the future development opportunities on the former Fort Ord. Despite another legal challenge, Cal Am will be positioned exactly where it has wanted to be for many years – able to provide water to new Fort Ord development.

Related legal hurdles include overcoming Marina Coast Water District worries that it has been invaded. MCWD is litigating against Cal Am for not making promised payments from the earlier Regional Desal Project. But expect Cal Am to play hardball. Remember that American Water Works has a national expansion strategy to acquire smaller water services (under 10,000 customers) when opportunities arise. These are called “tuck-ins.” MCWD has about 8,000 customers.

Recently, I have pleaded with the Mayors Water Authority to look at the legal risks Cal Am is facing, and the relevant water supply contingencies. But those in the know seem not to be concerned.

This is not mission creep, nor a series of unexpected circumstances. It is corporate planning. I have seen, read and heard too much over the years to think otherwise. I think the corporate strategy is clear. Cal Am will be positioned exactly where it has dreamed to be, right in the middle of Fort Ord, the only area with significant growth potential on the bay. All because it expects to win every legal challenge.

With such litigation ahead, who has confidence that Cal Am will meet the milestones set by the state’s cease-and-desist order?

Riley is managing director of Public Water Now and a regular contributor on water issues. He has been an active observer of each aspect of Cal Am’s desalination ventures and a technical adviser to the Peninsula Mayors Water Authority.

 

George Riley
georgetriley@gmail.com
645-9914

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Monterey Downs EIR might not survive close inspection

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Business people horse racingIt will be interesting to see what the environmental review experts come up with when they dig into the “Final Environmental Impact Report” on the Monterey Downs project. Expect them to find plenty to talk about. It took the decidedly inexpert Partisan staff about 20 minutes to spot a fairly significant problem.

It isn’t the kind of thing that will stop the project but it will remind project critics, and there are many of them, to accept nothing at face value as they scour all those pages of dry discussion and even drier fine print.

The problem has to do with one word, “wide,” and how its absence rather dramatically changes the meaning of a section having to do with the project’s water supply, particularly the sustainability of the Salinas Valley groundwater basin.

Some quick, obligatory background. After a long delay, the city of Seaside on Friday released to the public the environmental impact report on the Monterey Downs project, a hotly contested plan to build a horse racetrack 1,280 housing units, an arena, hotels and other facilities on a nicely treed site at Parker Flats at Fort Ord. The EIR was prepared for the city by Michael Baker International of Irvine. It’s a thick and heavy document that includes tons of information, including numerous letters from government agencies and others, including supporters and opponents.

This EIR found numerous environmental issues of concern, including water, of course. It was well established before the environmental review began that while there may be enough water available to start the project, there isn’t enough to complete it. For that reason, developer Brian Boudreau and project supporters at City Hall hope to move ahead in phases while others work on developing an additional water supply.

The primary purveyor of water for the project would be the Marina Coast Water District, which does have plans for a desalination plant down the road. But the water district, MCWD, pumps a considerable amount of water out of the ground, including water from the Salinas Valley groundwater basin (SVGB), the principal source of irrigation water for the Salinas Valley.

Here’s where “wide” comes in. Strike that. Here’s where “wide” should come in.

Buried at the bottom of one long section about comments from other agencies, the EIR repeats several lines from the draft environmental impact report from a year and a half ago. It says, “The Salinas Valley Groundwater Basin has a large storage volume and is recharged by the Salinas River, which is augmented by upstream reservoirs managed by the MCWRA (Monterey County Water Resources Agency). Therefore, the aquifer does not experience variations due to climatic conditions.

I put that last sentence in bold italics because that’s the key passage. It also caught the attention of the Monterey Peninsula Water Management District, which wrote to the city in June 2015 about that and other water-related issues.

The letter, by district manager Dave Stoldt, said his agency monitors the groundwater basin, partly because what happens there affects what happens in the Seaside groundwater basin, which supplies much of the Monterey Peninsula. And, he continued, the draft EIR “presents no data or references that support the conclusion that ‘the SVGB does not experience variations due to climatic conditions.’”

Stoldt writes that there clearly is a connection between rainfall and the status of the Salinas basin.

“The overwhelming evidence for the SVGB is that over the long term, recharge from precipitation and reservoir storage releases does not match groundwater production, and the basin is in a condition of chronic overdraft. Any conclusion … that suggests otherwise should be removed and a statement that reflects the present understanding of the basin condition should take its place.”

The writers of the EIR addressed the issue by attributing the sentence in question.  The EIR says, “This statement concerning SVBG was obtained from the Water Supply Assessment and Written Verification of Supply for the Monterey Downs Specific Plan (Schaaf & Wheeler, November 6, 2012) (pages 22-23).”

But, and you problably saw this coming, what the Water Supply Assessment and Written Verification of Supply for the Monterey Downs Specific Plan actually says on Page 22 is that “the aquifer does not experience wide variations due to climatic conditions.”

Emphasis added in hopes of sparking some discussion about the difference between no variations and some variations.

Big deal? Probably not. The project is not going to rise or fall over this one slip. But the makers of the EIR had 18 months to clean things up following the release of the draft environmental impact report, and a mistake like this suggests either a fairly substantial case of sloppiness or perhaps some inappropriate bias in favor of the project. Either is cause for concern as the experts dig in.

To read the report, click here.

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Howard Gustafson

UPDATED 10 A.M. MONDAY

For a time, the antics of Howard Gustafson were almost amusing. He was everybody’s screwy uncle, the guy who popped off whatever happened to be on his mind, whether or not it was pertinent to the conversation.

Even so, he has been a board member at the Marina Coast Water District for years now, and even though he has called one of his colleagues a “reject,” another a “moron” and yet another a “liar,” he’s currently the board president.

Here’s the latest:

Because of his position, the Surfrider Foundation’s Monterey Chapter on Friday sent Gustafson an invitation to the screening of a documentary film, “Sand Wars,” which highlights the environmental impact of sand mining. The Nov. 4 screening is to be followed by a panel discussion involving several local experts on the topic.

The invitation went out to numerous local officials, and was sent to the email addresses listed on their agencies’ websites. Gustafson’s went to the email address on the Marina Coast website and the response was from that address. It is possible, of course, that someone else with access to his computer might have sent it, or that someone hacked him or who knows what else. But of late Sunday, he had not responded to an email or voice mail seeking comment, so here’s his response to the invitation:

 from: <hgustafson@sbcglobal.net>

Date: October 23, 2015, 5:26:27 PM PDT

To: Ximena Waissbluth <xw@surfrider.org>

Subject:Re: Sand Wars Special Event Invitation

Be serious, go fuck yourselves.  GO TRUMP! We’re coming…

Waissbluh, who sent the invitation, said she was stunned by the response.
“My jaw dropped.  It was an invitation to a movie screening and panel discussion at MIIS- not so horrible really.  I double checked the email address, thinking it may have been some kind of hoax or spam because how can someone in such a public position write something like that.  Email address is correct, according the the MCWD website.”

That’s the long and short of it. When we hear from Howard, we’ll let you know what else he has to say. But in case you’re interested in the screening, here are the details:

Sand Wars Film Screening and Panel Discussion – November 4, 2015

Join us for a special screening of the award-winning film “Sand Wars”, a documentary film followed by a panel discussion of local experts to explore the issues surrounding the widely unknown practice of sand mining, it’s impact on the environment, and its consequences on neighboring populations. 
 
On Wednesday evening at 6pm, we invite you to a wine and cheese reception followed by the movie screening.  Directly after the movie, the expert panel members will discuss the global and local issues of sand mining, as well as potential solutions. The esteemed panel includes Dr Gary Griggs, UC Santa Cruz, Dr Jason Scorse, MIIS, Dr Ed Thornton, NPS retired, and will be moderated by Bob Battalio with CA Shore and Beach Preservation Association. 
 
Tickets are $10 adults and $8 for students, faculty and seniors.  This event is open to the public and tickets can be purchased online at www.oceanfilmfest.org or at the door.
 
WHAT:  Screening of Sand Wars film, reception and panel discussion – Monterey 


WHEN:  Wednesday November 4th, 6pm-9pm
WHERE:  Middlebury Institute of International Studies (MIIS) at Monterey, 499 Pierce Street, Monterey, CA 93940.  Event will be held in the Irvine Auditorium, McCone Bldg 


WHO:  The general public is invited 

 
HOSTS:   The Monterey Bay National Marine Sanctuary, The Surfrider Foundation Monterey Chapter, The San Francisco International Ocean Film Festival, The CA Shore and Beach Preservation Association
For tickets and more information, please visit: www.oceanfilmfest.org or contact Kayley Kim at kayley@oceanfilmfest.org

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Rather than rely on the newspapers or Cal Am’s paid flacks for the straight story about the debacle of the Regional Desalination Project (RDP), I urge you to read the document that has been filed with the San Francisco Superior Court.  It’s only 28 pages long and you really only need to read pages 4-19 to understand the real facts.  This document was filed by Marina Coast Water District in response to being sued earlier this summer by Cal Am and Monterey County for approximately $10 million.

If you want to download your own copy of this filing document, go to http://www.sfsuperiorcourt.org/online-services, then click on “Case Number Query” and follow the instructions to get to the place where you can enter the case number (547125).

Marina Coast Water District (MCWD) is a local agency that provides potable water, waste-water collection and water conservation services to the Ord Community (including portions of Seaside, Del Rey Oaks, Monterey and Monterey County) and the city of Marina.  By law MCWD is a non-profit government organization.

MCWD became a significant partner in the Regional Desalination Project (RDP) for five reasons:

  1. To be assured of eventually getting the additional water demanded by the Fort Ord Reuse Authority for the full planned build-out of the former military base;
  2. To be part of a larger desalination project in order to get slightly less expensive water due to the resulting economy of scale;
  3. To help our neighbors and employers in the Cal Am service area after they had significantly overbuilt their existing water resources and failed for decades to do much about it;
  4. To replace the capacity in its mothballed 300 acre-feet per year existing desalination plant; and
  5. To ensure that the RDP would not harm the Salinas Valley groundwater basin and the agricultural community in it.

Monterey County unilaterally pulled out of the RDP agreements because its own board member had a financial conflict of interest at the time he voted on the agreements.  Cal Am then used the alleged conflict of interest and the county’s withdrawal to also pull out of the agreements, even though MCWD had already spent $18 million on engineering design, permitting, land acquisition for the plant, etc.  MCWD never pulled out of the agreements and had no motive for doing so.  Nor did MCWD ever have a motive for being a party to destroying the whole project.

But was Cal Am’s stated reason for withdrawal from the RDP its real reason?  It’s interesting to note that under the RDP agreements, Cal Am was to build about $105 million of the needed infrastructure. Thus under the RDP agreement it stood to receive a Public Utilities Commission-authorized profit of about $10 million on that $105 million capital investment.  However, now that Cal Am has the entire $400 million project to itself, it stands to make a PUC-authorized profit approaching $40 million on that capital investment.  Would the possibility of an additional profit approaching $30 million be enough to cause Cal Am to withdraw from the RDP in order to take the whole project over itself, even if they had to pay MCWD for some the work already done?  You be the judge of that….

Please take the opportunity to read the attached court filing — you can be sure that the battalions of attorneys hired by Cal Am and the county are reading it.

Moore is a director of the Marina Coast Water District and an instructor at the Naval Postgraduate School.

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STATE HAS MADE CAL AM DESAL PROJECT A TEST CASE

OFFICIAL IN CHARGE OF EIR WAS PROJECT’S FIRST CHEERLEADER

TIME PRESSURE GIVES OFFICIALS EXCUSE TO CUT CORNERS

To hear some people tell it, one of the big problems facing Cal Am’s desalination project in Marina is criticism from those concerned about the environmental and economic impacts. Project supporters go so far as to blame the critics for the various delays that have forced repeated changes in the pre-construction timetable.

But after following the process closely for a decade now, after being counseled interminably by project proponents and reading environmental impact reports, feasibility studies and all manner of other paperwork, I have come to the opposite conclusion. I believe one of the venture’s biggest problems is that it has too much support. By that, I mean that agencies that should be honestly evaluating the project are advocating for it instead, leading to lapses in judgment and errors in execution. Peninsula business interests, meanwhile, panicked by the threat of water cutbacks, have taken a full-speed-ahead posture that could help produce a flawed and incredibly expensive answer to a problem that has other solutions.

When a previous incarnation of the desal project fell apart, it wasn’t because naysayers had put up too many obstacles. Key factors in its demise were a politically awkward management structure and the fact that money was being passed under the table in an effort to advance the project, not destroy it.

Now, proponents and participants in the project have proved again to be their own worst enemies, first by making overly optimistic projections about the composition of the water to be desalted and by ignoring glaring conflicts of interest built into the process of testing the water at the plant site north of Marina.

In defense, those in charge cite the heavy deadline pressure, with the state threatening to force untenable cuts in the Peninsula’s use of Carmel River water. They say time is so tight that they must push on or else the Peninsula’s economic well being will be in grave danger. Such thinking plays right into the hands of Cal Am, of course, which makes its money no matter how many times it has to start over.

When I was opinion page editor of the Monterey Herald, we came out in favor of desalination because of the shortage of practical alternatives. We were one of the first entities in the community to voice support. I now feel that the alternatives are becoming more attractive and that the project in its current configuration presents even graver danger to the well being of Cal Am customers on the Peninsula, who will be forced to pay for it no matter how expensive it becomes—even if it never produces a drop of drinkable water.

PENINSULA PLANT COULD BE A MODEL, FOR A PRICE

Creating additional pressures and costs, the state is using the project to test its preferred water-intake technology with minimal compensation to the Peninsula. As it stands, Peninsula water customers will be required to cover millions and millions of dollars in expenses regardless of whether the test is a success. Remember when Cal Am and its supporters were breathlessly arguing that testing of the intake method needed to begin as soon as possible, and that anyone who said otherwise was an obstructionist? That testing is on hold now for reasons that informed and objective observers could have seen coming, and the money meter continues to spin.

Carmel Mayor Jason Burnett, an almost full-time participant in the desalination process as chair of the Peninsula mayors’ water authority, agrees that the financial burden created by the experiment should be shared by state taxpayers, and he indicated he is working on it.

Tap drippingEven now, while the testing and environmental impact review are both stalled, Cal Am is going after yet another set of rate increases to help pay for the plant that may never be built and to offset income it has lost because its Peninsula customers have done such a good job of conserving water. Residential customers, who already consume and conserve some of the most expensive water in the state, would see rates increase by 29 percent under a request Cal Am filed last week with the Public Utilities Commission. At the same time, businesses would see a rate reduction of some 14 percent even though some business interests already pay discounted rates in what amounts to a reward for supporting the desal project.

Cal Am’s ability to obtain rate increase after increase from the PUC helps explain why the utility is comfortable doing whatever the state wants, no matter how illogical or expensive. In the cost-plus world of utility accounting, bigger expenses mean bigger profits.

PENINSULA IS A DESAL GUINEA PIG IN A COSTLY EXPERIMENT

Few people quarrel with the need for a desalination plant or some other means of stretching the Peninsula’s water supply. We have nearly destroyed the Carmel River, our primary water source. State officials were correct to issue a cease and desist order that will require Cal Am to greatly reduce pumping from the river in stages, which local officials are desperately attempting to postpone until the plant comes online.

Compounding the challenge significantly, the project has become an important test case that will help decide what type of water intake should be employed by other desalination facilities now on the drawing boards up and down the state.

They make it sound super complicated. It isn’t. It is worth your attention if only because it will help you understand the latest conflict of interest issue that has thrown a wrench into the process.

The easiest and least expensive intake is known as open ocean, which means pumping water straight from the ocean. The problem is that all manner of marine life is pumped into the plant along with the salty water.

Environmental groups and the various regulatory agencies greatly prefer the idea of subsurface intake, which involves pumping from below the ocean floor, using the sand and other sediment as filters to protect aquatic life. In the best case from an environmental standpoint, the wells would be drilled some distance from the shore and slanted so that their intakes would extend below the ocean floor.

Unfortunately, there is some guesswork involved in deciding exactly where to drill the so-called slant wells and there are few successful examples.  Cal Am’s project presents the state with one of the largest and most meaningful tests of the slant well technology so far.

Racks of filters in a desalination plantAlso unfortunately, not everyone involved in the project has the same agenda, and the state apparently ignored some well-established principles of how public works projects should be organized and assessed.

Perhaps the best way to illustrate that is to examine the shifting roles of the man now in charge of preparing the all-important environmental impact report for the current project. That’s Eric Zigas of the San Francisco firm of Environmental Science Associates.

Zigas may be a familiar name to those who have followed the desalination follies from the start. He also one of the architects of the previous incarnation of the desalination project–the version that devolved into a web of litigation. Before that he was a key part of the Public Utilities Commission team that decided desalination was the best solution to the Peninsula’s water problem.

PROJECT’S CHIEF ENVIRONMENTAL MONITOR STARTED WITH A VERY DIFFERENT ROLE

The current desalination proposal grew out of what became known as Plan B after plans for a dam on the Carmel River fell apart. The Legislature put the Public Utilities Commission in charge of finding an alternative and Zigas was hired to help draft the plan. He teamed with officials at UC Santa Cruz and various state and local agencies to help craft an ambitious scheme for a desalination plant at Moss Landing with a long list of environmental amenities such as a garbage-powered energy supply. The PUC then assigned Zigas to tout the plan to various Peninsula business groups, service clubs, news outlets and others. He effectively helped sell the community on desalination.

But for various reasons, most of the bells and whistles were later removed from the plan, and the project became a cumbersome joint venture between Cal Am, Monterey County and the Marina Coast Water District. Despite Zigas’ earlier role as the official cheerleader for the project, his firm was hired by the PUC to prepare the environmental impact report on that proposal before other factors caused it to be shelved.

Today, Zigas leads the environmental analysis of the process he helped initiate. Those who have worked with him say his experience on the Peninsula gives him unmatched knowledge of the issues involved, which are many. The project is complex, including a plant processing countless gallons of sea water, disposing tons of brine, and dispatching fresh water through a new network of pipelines. The expectation, of course, is that the analysis will be scientific and unbiased. A draft of the EIR is now circulating and the technical community now examining the document will determine whether has Zigas successfully switched hats. Considering how much controversy the process has created, the final EIR is very likely to be tested in court.

(When the first draft of the official environmental impact report incorrectly concluded that there were no functional agricultural wells near the plant site, Zigas briefly defended his team’s work before adopting a no-comment stance. )

eric-zigas

Eric Zigas

Zigas isn’t talking to the press, at least not to the Partisan, and he hasn’t publicly addressed his role in the latest delays.

The EIR process has been pushed back a few months because of a conflict created by the involvement of a firm that holds a patent on the slant-well technology. To help assess the test well, Zigas’ firm had brought in a company called Geoscience, headed by noted hydrologist Dennis Williams. In addition to the potential conflict presented by his patent, Williams also was working for Cal Am on the same project.

The PUC’s project manager, Andrew Barnsdale, was reassigned last week because of the revelations, which were brought to light by project critics. At the same time, a PUC administrative law judge, Gary Weatherford, issued a lengthy order requiring ESA and Cal Am to provide the contracts of everyone involved and to explain the degree to which the testing process may have been tainted.

It should not be forgotten that the Geoscience situation surfaced after the Coastal Commission suspended pumping at the test site last month because the well apparently was taking in more fresh water than anticipated. After the testing began, the groundwater table started dropping, which Cal Am blamed on agricultural pumping though it had insisted previously that there was no agricultural pumping in the area. Critics of the project had nothing to do with that.

GEORGE AND JASON LOOK AT PROJECT FROM DIFFERENT PERSPECRTIVES

George Riley has followed the project’s process as closely as anyone, and has a unique perspective. While he is an activist and head of a group that advocates public takeover of Cal Am, he also has been an accredited participant in the PUC processes as well as a member of a technical advisory committee advising Peninsula mayors on desal matters.

He agrees that the process has been marred by inter-connections.

“A quiet alliance of advocates, appearing as specialists, has emerged,” he said by email. “All are also quietly supported by the ruling state agencies. The ruling water elites at the state level have a greater role here, and has not been discussed.  And Monterey Peninsula as guinea pig is useful for them.”

Riley said Zigas and Environmental Science Associates do deserve credit, both for helping get the well testing process on track after Cal Am’s dawdling had worsened the time crunch and for pushing for well testing data to be included in the environmental impact report. The idea, Riley said, is for the final EIR to become “the vehicle for tooting the horns for slant wells” strongly favored by the various state agencies.

In Riley’s view, the fumbles that have marred the process would not be so worrisome if the state was helping to pay for the slant well testing and if the state would do more to encourage competing proposals that possibly could address the Peninsula’s water needs more quickly and less expensively.

Burnett, in a telephone interview Saturday, said he supports the PUC’s decision to call a brief timeout over the patent issue and examine where things went wrong with the test well team. He said it is important now to view Geoscience as a “proponent” rather than an arms-length analyst.

But Burnett disagrees that the process is fundamentally flawed or that the project’s management structure should be overhauled. He said he has great faith in Weatherford, the administrative law judge who is reviewing the testing conflicts.

(Burnett, by the way, has taken quite a beating politically in some quarters for his role as a leading advocate for such a controversial project. His detractors should be reminded that he helped  create a financing package for the plant that should save ratepayers millions of dollars over time and managed almost single-handedly to impose some level of public oversight over the project despite serious resistance from Cal Am.)

Antique water fountain, detail of a source for drinking water, drinking waterSUCCESS SHOULDN’T REQUIRE SETTLING FOR SECOND-RATE

From where I sit, it seems clear that the PUC needs to do more than study the known conflicts and then continue on the same course if this project is to be salvaged. Soonest, it needs to join with local politicians and work with the State Water Resources Control Board to eliminate the artificial pressure caused by the cease-and-desist order deadlines before they result in a hopelessly flawed and expensive project.

Barnsdale, the now departed PUC project manager, is a bureaucrat, a permit processor, not a construction or desalination expert. His replacement needs to be someone with real world experience rather than a purely regulatory background.

The PUC also needs to do what it can to support alternative measures such as wastewater recycling and stepped up conservation and to take a closer look at the competing proposals, the Moss Landing plans being pursued by Nader Agha and the DeepWater group, to see if they could effectively supplant some or all of the Cal Am project.

Obviously, the PUC also needs to take a long look at Cal Am’s rate structure for the Peninsula and drill into the company’s argument for two classes of rates, one set for the relatively helpless residential customers and a discounted set for the more politically powerful business class.

Finally, Cal Am and its supporters need to stop attempting to vilify anyone who raises questions about the process. All major public works projects encounter problems and this one is  more complex than most. Clearly, outside scrutiny will make it stronger, not weaker. As a community, there is strong agreement that we are obligated to stop abusing the Carmel River and unless someone works some magic and soon, we seem to be stuck with desal as the solution. That does not mean, however, that we must accept a project that carries a bloated pricetag and creates as many problems as it solves.

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Cal Am’s latest desal delay is its own damned fault

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For the past couple of years now, California American Water and its various partners have told us that time is of the essence, that its plans for a $400 million-plus desalination plant must proceed at all costs. The threat of a state-ordered cutback on water use looms large, especially over the hospitality industry, the Peninsula’s largest economic driver.

So when environmentalists have raised concerns about the impact of drilling giant wells under the beach, when those of a technical bent worried aloud about the integrity of the pre-construction testing process and the potential impact on groundwater near the plant site, when people concerned about the high cost of mistakes pointed out a glaring conflict of interest among the project team, they were all dismissed as obstructionists.

“They” are trying to stop the project, we were told, though “they” were never really identified. (The working definition of the so-called obsctructionists might be anyone who isn’t being paid to advance the project or doesn’t stand to receive a direct financial benefit.)

Those arguing that state environmental laws should be not be ignored for the convenience of the engineers were called tree huggers or worse, shills for potentially competing projects. Though they have found themselves in an emergency of their own making, Cal Am and its bedfellows argue that there have been too many delays already and rules are meant to be broken if it is in the interest of speed and commerce.

And now comes another significant setback for the project. Ruling Extending EIR Deadline for MPWSP Whose fault? Those damned obstructionists? Not hardly.An administrative law judge for the Public Utilities Commission ruled Thursday that the bureaucratic timetable must be set back three months because one of the key figures in the well-testing process is wearing too many hats. There are things to be sorted out, said an exasperated judge, Gary Weatherford.

Here is today’s Herald story on the ruling.

It seems that Dennis Williams of Geoscience is working for just about everyone involved in the well testing, including both Cal Am and the PUC, and he also holds a patent on the technology being tested. In other words, he was being paid by the PUC and the company preparing the environmental impact report on the project to help test Cal Am’s test wells of his design while also being paid by Cal Am. What could possibly go wrong?

So now expect to be told that this is an unnecessary delay caused by “those who would destroy the project.” But the truth is that this is the fault of those making the decisions on behalf of Cal Am and the Public Utilities Commission. This is not the handiwork of obstructionists. This is another breakdown in the procedure, a result of arrogance.

True, some of those who aren’t big fans of the project did notice the conflict and pointed it out but the powers that be on this project already knew all about it. If they say they didn’t, they will either be lying or admitting to grotesque incompetence. Google Dennis Williams and Geoscience and see how long it takes for you to spot the problem and say, “Oh, my.”

Williams is highly qualified for the work involved and it is entirely possible that he can segregate his functions properly and provide accurate assessments, at least according to his own standards. But that should have been discussed openly by the various parties – including the public – right from the start. Not now, after the media demonstrated that the PUC’s experts couldn’t even find a private well near the test site. Not now, after unexpected decline in groundwater in the area suggests the test well isn’t working as it is supposed to. Now now, after Cal Am’s customers have been put on the hook for some $10 million in testing costs, costs that will come straight out of customers’ pockets no matter how any of this turns out.

It could be that Williams was the best choice for the job and should have been hired. But doing that right would have required putting his various entanglements on the record, and you know what can happen when the public knows too much.

Weatherford’s ruling comes just a week at the Coastal Commission ruled that Cal Am needs to do some more work on its well testing program, which begs the question of whether Cal Am could have accomplished more early on by refining its testing plan rather than scratching and clawing to fast track it through the regulatory processes in the first place.

It could be that under current standards of public works construction, it isn’t possible for a project to be built without compromises of quality, design and process. Maybe there is corruption and self-dealing in every venture beyond some certain financial threshold. Maybe it’s $100 million. Maybe it’s whatever Cal Am’s budget calls for.

From Cal Am’s perspective, Tom Moore fits right into the obstructionist category. He’s on the board of the Marina Coast Water District, which once was a partner in Cal Am’s desal efforts, a partnership that fell apart spectacularly when it came out that a former county water official, Steve Collins, was being paid under the table for consulting work on the project. Now there is litigation and Monterey County and Cal Am and Moore’s district are trying to make each look bad and, for the most part, succeeding.

But Moore is also well positioned to comment on the swirl that the desal venture has become. Here’s his take.

“Given the history of the Regional Desalination Project and what happened to Steve Collins, logic would dictate that Cal Am and the CPUC would carefully vet ALL of their consultants and contractors to ensure there wouldn’t be even the slightest whiff of the appearance of a conflict of interest.  And logic would also dictate that any consultant or contractor thinking about working for either the CPUC or Cal Am on the Monterey Peninsula Water Supply Project, or both in this case, would consult with competent attorneys and disclose, disclose, disclose in order to stay the hell away from even a remote possibility of a conflict of interest.  Unfortunately, it seems logic was not at work here.

“What does appear to be in abundance in this entire debacle is an appalling belief:  that when it comes to making more money for your shareholders and yourself, the ends always justify the means.  The withholding of critical information from customers and the public, the concealment of conflicts of interest, twisting the truth and even outright lying seem to be coin of the realm for the folks who hold this appalling belief.  It’s a very unfortunate commentary about private commerce today that $20 million $30 million will buy a lot of this sort of dishonesty.”

As it stands, the process leading to a possible desalination plant has become littered with thorns. Supporters of this project feel they must barrel through it all and demonstrate certitude  even though they has never built such a plant or maneuvered through such a process. They apparently feel that to stop and listen to anyone who isn’t on their desal team might be seen as a sign of weakness, so they choose to ignore all the noise from the bleachers. “They’re just trying to stop the project.”

And while that might be true for a few, many, many who have been watching and weighing in on the desal project for a decade now want only for the project to be completed as efficiently and cleanly as possible. And, just in case, they want officials to continue considering alternative projects that likely would not be as expensive or environmentally intrusive. There are many who don’t trust Cal Am and fear that special deals with the hospitality industry will leave everyone else paying exorbitant amounts for water. But they also understand that the river needs to be protected and an additional water supply is required. What they want is for Cal Am and the PUC to do a better job.

Cal Am averted a public takeover effort partly by convincing the public that it can do a better job than a public agency. Since then, the company has have presented no evidence of that. If there was generalized trust that Cal Am and its boosters were capable of getting it done on their own, and keeping costs at least somewhat under control,  the noise surely would die down. But what has gone down instead is the trust level, and there may be no end in sight unless Cal Am et al change their ways.

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Illustration depicting a large number of directional roadsigns in a chaotic arrangement. White  background.After careful contemplation and the expenditure of countless hours of staff time and other resources, I have come to the conclusion that the two biggest problems facing the Monterey Peninsula are quite closely related.

Problem No. 1, of course, is the declining water supply, which should have been addressed decades ago before we decided that strawberries and grapes were good choices for desert cultivation. The leading proposed solution at the moment involves a possible desalination plant near Marina and an assortment of smaller efforts involving conservation and recycling.

Problem No. 2, almost as obviously, is that just about every element of Problem No. 1 seems so complicated, complex and confounding that there are only a handful of people who understand any of it. On top of that, most of those who do understand it don’t care that you don’t. In fact, some are glad you don’t and there are even those who are being paid to make sure you don’t.

Why so complicated?

First, complexity makes things more expensive,  and when you’re on the receiving side of “cost plus,” there’s a lot to be said for expensive. Second, with all of that cost plus to be spread around, there are many players willing to participate in the search for solutions. Too many.

That starts with the misleadingly named California American Water Co., which has as much to do with California as the autobahn. It is supposed to be playing a lead role in solving Problem 1 but it spends most of its time wading around in the swamps of Problem 2, creating complications and looking for trouble. The company likes to portray itself as a helpful fellow in boots going out into the community, patching leaks and coaching Little League teams when the truth is that the bean counters in the home office depend on those very leaks in order to keep the bottom line above water. Way above water.

Then there’s the Public Utilities Commission, which technically is in charge of solving Problem No. 1 even though it has absolutely no experience in problem solving and even less in desalination. The Public Utilities Commission apparently was put in charge of this process because our state legislators wanted to keep it away from all aspects of gas pipeline safety. You might say that the PUC is Problem No. 3.

A key concern of those involved in the effort locally is that if the PUC ever approves a timeline and a production schedule, it might as a matter of routine order them confidential and put them under seal, effectively killing the venture.

Then there are the local agencies. For instance, the mayors’ authority, a quasi-government agency made up of the mayors of the Peninsula cities. It was set up because the first local agency given an oversight role, the Monterey County Board of Supervisors, couldn’t figure out how to convert desalination progress into campaign contributions. The supervisors are hoping to get involved again when construction seems imminent and quite a few construction contracts will need to be awarded.

The mayors’ committee was hoping to jumpstart the process because the hospitality industry pretty much decides who gets to be mayor in these parts and it needs water for hotel rooms occupied by tourists who won’t have to pay for the project. The mayors have gotten off to a slow start, however, because the Del Rey Oaks mayor is busy building ammunition bunkers throughout his community and the Sand City mayor is napping.

A water district in Marina has some role in all of this, but for now its leadership seems to be in a sort of bureaucratic penalty box and won’t be allowed back into the game until the second overtime period. It is a shame because some of the district’s leadership has demonstrated to interested members of the public that you don’t have to have a clue to get involved.

Part of the problem has to do with the news coverage but it isn’t what you might expect. In this age of shrinking newspapers, it hasn’t been a lack of coverage. Just the opposite. In the last decade, the Herald has published nearly 173,500 articles mentioning Cal Am, 62,600 articles containing acronyms for non-existent water agencies, the same number of articles in which Cal Am spokeswoman Catherine Steadman says, “We’ll get back to you about that,” and some 20,000 articles in which County Counsel Charles McKee says documents are being sealed in the interest of full disclosure.

Some of the confusion is, of course, the public’s owned damned fault. For instance, believe it or not, there are those in the community who can’t seem to grasp why   a desalination plant designed to take water from the ocean and convert it into drinkable fresh water needs to drill a series of inland wells in order to take already fresh water from Salinas farmers and, through a process invented by the Coastal Commission, convert it into cash to be used to pay consultants to declare the existing water supply more than adequate as an effective hedge against the 180-foot aquatard. Do the math, people. Sheesh.

Cal Am isn’t the only game in town, of course, which makes things that much more complicated.

Peninsula wheeler-dealer Nader Agha has the property and the plans to build a better and cheaper desalination plant in Moss Landing but Cal Am keeps telling people that Agha and former county Supervisor Marc del Piero are the same person, which violates a county ordinance requiring desalination operators to front only for seated supervisors.

Then there’s Deepwater Desal, a creation of Monterey PR man David Armanasco, who has been sidelined because his core clients have hired him to paint murals of wharf pilings to installed over the actual pilings at Fisherman’s Wharf.

And speaking of the wharf, let’s not forget the lawyers. Every lawyer in California who ever lived in a house with a low-flow shower has been declared a water expert for purposes of this feeding frenzy. For convenience and efficiency, each seems to have brought on Tony Lombardo as local counsel. Those who have been around a while will remember him. He wrote the previous general plan while representing most of the supervisors and many of the businesses at Fisherman’s Wharf, including the two warring fish houses that both claim to have invented cioppino Monterey, which consists of a handful of saltwater taffy, samples of five kinds of clam chowder, a couple of restaurant pagers, Sal Cerrito’s will, a half loaf of Armenian pita bread and a half pound of Bubba Gump shrimp but, alas, no sardines.

And let’s not forget the environmentalists, the “no-growthers” who, we are constantly told, are busily working against the interests of the community to reverse all the  progress on the desal front.

Next: Sheriff Bernal’s plan to patrol the waterfront.

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Thief stealing from handbag of a woman.This probably will not surprise you. The people who are supposed to be in charge of solving the Monterey Peninsula’s water crisis have elected to go into some hugely important negotiations with state water regulators under the cloak of secrecy.

Apparently they have forgotten, once again, that secrecy is one of the main reasons the Peninsula is still in a water crisis. Let one lawyer find an excuse for secrecy and the people who are supposed to be representing the public interest in this big and expensive water mess will cheerfully exclude the public from the conversation and then act as though they had no choice.

One possibility is that officials of California American Water, the Peninsula mayors and others simply believe that their jobs will be easier without the muss and fuss that the public is so capable of producing.

A more ominous and more likely explanation is that they fear the results will not be heavily weighted in favor of Cal Am and others such as the hospitality industry, which speaks with a loud voice when it counsels the mayors and other officials both elected and appointed.

This time, the secrecy has been wrapped around details of a proposal that was advanced to the state last month. It advocates a relaxation of the state-imposed timeline for cutting back on the amount of water that Cal Am pumps from the Carmel River each year.

In order to force the Peninsula to stop degrading the river, the state set a series of deadlines and pumping limits that, if they go into effect, would devastate the Peninsula’s economy. The negotiations that are likely to begin this summer between local interests and the state are of utmost importance to everyone on the Peninsula – and by everyone, we’re talking about everyone, not just those who take lunch regularly with lawyers and lobbyists.

An article in the Monterey Herald on Saturday has Carmel Mayor Jason Burnett assuring us that there will be plenty of time for public involvement later, after local officialdom has hammered out a tentative agreement with the state. There will be public hearings, Burnett said, suggesting that public officials pay attention to what the public says at public hearings after the powers that be have reached consensus.

Even by the standards of Cal Am and its elected accomplices, this decision to keep the public in the dark rests on exceedingly flimsy grounds. Once upon a time there was a lawsuit challenging the state’s right to order a cutback on Carmel River pumping. The suit was suspended three years ago, but lawyers for the state determined that details of the current proposal are exempt from disclosure because of that litigation. Among the many problems with that position is a lawsuit suspended three years ago is, for all practical purposes, non-existent. Another is that lawyers for the state are not decision-makers. They are supposed to give advice. If members of the state water board want to tell the citizens of the Peninsula to pound sand, let them come out and tell us why.

As a direct result of the state’s cutback order, Cal Am has embarked on two major efforts to build a desalination plant, the most expensive solution but a solution. The first effort emerged from more than a year of secret discussions involving the state Public Utilities Commission, Cal Am, Monterey County government, UC Santa Cruz, and the Marina Coast Water District. It was to be a desalination plant operated by Cal Am and Marina Coast, a small, essentially dysfunctional water agency with no real connection to Peninsula issues. Monterey County government, which prefers to operate in smoky back rooms, brought almost nothing to the table but managed to inject secret side deals into the project, sabotaging the venture early on.

Perhaps the officials thought that secrecy would result in some efficiencies and a streamlined, feasible project. Instead, they got themselves an exploding cigar. If they had brought the public in from the start rather than waiting until the cigar was being lit, someone might have shown them that the design was flawed.

That farce cost Cal Am five or six years worth of progress toward a water solution and all-but destroyed the public’s faith in the company’s ability to get the job done. Already, Cal Am is lobbying the state to allow it to charge its customers, not its shareholders, for the cost of the huge fines that will be imposed if the deadlines are not met.

One of the biggest problems with the first desalination effort also afflicts the current one, though to a slightly lesser extent. The first time around, no one was in charge. Technically, the Public Utilities Commission was the “lead agency,” then as now. But the PUC is a regulatory bureaucracy, not a utility, not a construction company. It doesn’t employ engineers or hydrologists. Cal Am was sort of in charge, then and now, but it had no real reason to lead because it makes money no matter what. For regulated utilities, failure is just as profitable as success and sometimes more so. When state rules essentially allow it to collect all its costs plus a 10 percent profit, two failed projects are likely to be more lucrative than one successful one.

Marina Coast wasn’t in charge and Monterey County certainly wasn’t in charge. But if the structure of the first project had been presented to the public from the start rather than as an afterthought, someone might have noticed the absence of meaningful leadership. In the public arena or in private enterprise, things usually don’t get done unless someone’s career will rise or fall depending on the result. The first effort failed largely because the public was never a partner and no one was accountable. The public sector culprits got re-elected. The private sector culprits got bonuses.

The structure of the current effort is less complicated. Neither Marina Coast nor the county is involved, but a committee of Peninsula mayors has stepped forward to take their place. Burnett, the Carmel mayor, took a lead role in creating that relationship and deserves serious credit for doing so. He saw how lack of leadership and accountability helped kill the first attempt, so he stepped up, tying his own considerable political ambitions to the venture. He has been a real help, creating a financial structure that would save the public tens of millions of dollars if the project ever is completed, but he has paid a price. His efforts have alienated Cal Am critics and slow-growthers who see a desalination plant as a growth inducer.

Unfortunately, Burnett seems to be going along with the cone-of-silence plan this time. He was left to explain it in the Herald article, likely because the others involved were afraid to stick their necks out. Maybe he has simply spent too much time with the others and has been “turned,” the way hostages become dupes of their captors. Hopefully, it is not too late.

In case you’re not getting the drift, Jason, this piece is an attempt to get you to argue against this secrecy routine or to let us know who feels otherwise and why.

What is the benefit of secrecy? Simplicity is the most obvious answer, but it goes deeper than that. Information is power, and you can bet that Cal Am is already sharing details of the proposal with its allies – the Hospitality Association and the Carmel River Steelhead Association for starters. That way, those groups can spend the next several months lobbying the state and working with associates in other organizations to join in. That way, those groups will have ample time to study all the charts and formulas and to bend the analysis to their liking.

Almost everyone on the Peninsula would support a relaxation of the state’s deadlines. No one wants to see our economy dry up and blow away. But how many years might be added to the timeline under this proposal? Are there concessions to be made later? Earlier? Are there provisions for cutting supplies to some classes of customers but not others. Cal Am, the PUC and even the Monterey Peninsula Water Management District took part in essentially secret talks two years ago that resulted in a preferential rate structure for area hotels.

If you’re part of an average household on the Peninsula, secrecy is not your friend. It won’t help solve the water problem but it will help Cal Am and its friends at the PUC quietly pick your pocket.

What can you do? Don’t bother calling Cal Am. It stopped paying attention to you years ago. But you can and should call your mayor or your state representatives and tell them you’ve had enough of this nonsense.

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Man's Hand Resting on a Stack of Bibles, Isolated Background

Monterey County Supervisor Dave Potter and former county water czar Curtis Weeks are among those expected to testify in the trial that pits the Marina Coast Water District against the team of Monterey County and California American Water.

The trial centers on the failed regional desalination project, which was a partnership between the three agencies that are now fighting over responsibility for millions of dollars in bills paid and unpaid. The trial is scheduled to start today in San Francisco Superior Court and to last about a week.

Potter and Weeks are included in the county’s list of expected witnesses. Lawyers for the county also plan to introduce videotaped testimony from Steve Collins. He is the former county water official whose side job with the project manager helped lead to the collapse of the project. After a long investigation, Collins pleaded no contest to one count of conflict of interest but maintained that everything he did was at the direction of Weeks, Potter and another county supervisor, Lou Calcagno. Collins is also expected to be called as a witness for Marina Coast.

Key issues in the trial are who was responsible for Collins’ paid relationship with RMC Water and Environment, the project manager, and when the county and Cal Am learned of his double role. The timing of their knowledge is critical to determining whether the county and Cal Am acted to void the project agreements in a timely manner or waited until contractual deadlines had expired.

Though Potter was heavily involved in the desalination venture on behalf of the county, he has said in depositions and in interviews with investigators that he did not know about Collins’ paid work for RMC for close to a year. According to lawyers for the county, he’ll be repeating that stance this week.

Perhaps the most interesting witness on the county’s list is Weeks. He was the chief executive of the county Water Resources Agency while Collins was an active member of the agency’s board of directors. Around the time Collins went to work for RMC, he and Weeks formed a partnership, a consulting firm that had visions of taking over management of the desalination project.

Under some amount of pressure, Weeks left the county position after Collins’ double role had been publicized. At one point, according to Collins’ lawyer, Weeks was considering seeking whistleblower protection and testifying on behalf of Collins. Things changed when the county offered him half of his contractual severance pay and he went to work for an environmental consulting company that has been working for the county under a series of contracts. That arrangement led to speculation that the county had essentially bought his silence.

Also among those on the county’s list are Cal Am President Robert Maclean and Lyndel Melton, a principal with RMC.

Jim Heitzman, former general manager of the Marina Coast Water District, is expected to testify about his role in helping to arrange for Collins to work for RMC, which eventually paid him $160,000.

Two lawyers are on the county’s list, outside counsel Dan Carroll, who represented the county throughout the troubled desal project, and Lloyd Lowrey, former general counsel  for Marina Coast.

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Cal Am and critics are fighting hard over a hole in the sand

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The Cemex sand-mining operation along Monterey Bay north of Marina, which is where Cal Am wants to drill a desalination test well.

During the political campaigning that ended with last week’s election, Democratic Congressman Sam Farr did something unusual. In the race for two seats on the Marina City Council, he endorsed strongly conservative Nancy Amadeo and registered independent Dan Devlin Jr. instead of Democratic incumbent Dave Brown.

Farr’s explanation was straightforward. He was punishing Brown for not voting to let Cal Am Water drill a desalination test well in the Marina sand dunes.

In an email, Farr explained, “I support friends. I support (Mayor Bruce Delgado) and Nancy because they supported the rest of the Peninsula’s effort to solve the water issue. I thought the blockage (the majority vote against the permit) was selfish and punitive.”

Farr’s choice helps illustrate how much energy and politicking is going into the unresolved issue of whether Cal Am should be allowed to proceed with a test well. Ultimately, it’s about a lot more than a simple well, of course. It is the latest in a series of increasingly testy fights between the Cal Am camp, which includes the hospitality industry and other business interests, and Cal Am’s detractors, which include many area environmental activists and others who worry what an expensive desalination plant is going to do to the already high cost of water locally.

Cal Am has been trying for most of this year to move ahead with a plan to drill a test well to help determine whether the Cemex sand mining property on the Marina shoreline is a feasible location for the desalination plant it hopes to build to help solve the Peninsula’s water shortage. In essence, the plan is to drill a well slightly inland from the ocean to draw seawater and some fresh groundwater and determine whether the sand can serve as a filter to prevent the intake of sea life.

Engineers also want to see how much fresh water would be drawn into the well, an issue of grave concern to neighboring property owners and others with rights to the Salinas Valley aquifer, which reaches to Marina and beyond. If things go well, the well could be converted to a production well for the actual desalination plant.

Rather than granting a permit, however, the majority of the Marina City Council voted to require an environmental impact report, which would add many months to the desalination project. The council members say they were only protecting the environment and state environmental laws that require EIRs for projects that create the potential for significant harm. In an appeal to the California Coastal Commission, Cal Am and its cohorts say the issue is the economic health of the Peninsula, which they say easily trumps the environmental niceties.

The issue goes to the Monterey County Board of Supervisors Tuesday Nov. 11 for an advisory vote and then to the Coastal Commission the next day for a possible vote on a motion to overturn the city of Marina and allow Cal Am to proceed. Under tremendous political pressure to permit the testing, the commission is likely to say yes, but don’t expect it to end there. Much of the opposition input is written like legal briefs, so the two sides are likely to see each other in court.

Here, the Partisan will try to explain what’s happening, a task that will tax our analytical skills to the max. It might take a while, so you might want to take a seat.

BACKGROUND

As most everyone knows by now, the state Water Resources Board has issued an order requiring the Peninsula to reduce its reliance on the threatened Carmel River starting in 2016. After Plans A, B and C fell through, the only real plan in place now involves construction of a desalination plant along with a handful of supplemental projects, including additional wastewater reclamation.

Unfortunately for all, the process has been compromised by petty corruption, politics of all sorts, litigation and bureaucratic dilly-dallying. It became obvious long ago that there is no chance of meeting the state’s deadline, which is why an assortment of Peninsula bigwigs is preparing to descend on Sacramento later this month to beg for mercy and time. The state agency is fully empowered to require deep reductions in water usage, and the water-reliant hospitality industry is in near-panic mode.

Well testing is expected to take more than two years, once it gets started, and actual construction of the desalination plant couldn’t begin until completion of an arduous regulatory process and additional engineering work. Even so, Cal Am and the area officials hope to obtain the well-drilling permit as a signal to the state that progress is, at long last, being made.

THE VOTE

After a series of delays, Cal Am’s permit application finally went to the Marina City Council for a vote on Sept. 4. The issue put the council in an unusual position. Most city governments in the area are solidly behind Cal Am’s desalination plan because their jurisdictions are running short on water and political leaders are worried about the economic impact of a severe water cutback. Marina isn’t served by Cal Am, however. It has its own water district, the Marina Coast Water District and would not be directly affected by the state cutback order.

Making things more complicated, the Marina Coast Water District was a partner with Cal Am and Monterey County in an earlier incarnation of a desalination project. That venture fell apart, but Marina Coast Water District believes Cal Am still owes it some big money from that failed effort. Not so incidentally, trial over that dispute is scheduled to begin Dec. 1 in San Francisco.

Also not so incidentally, the City Council majority in Marina is politically compatible with the majority of the Marina Coast board, so Cal Am wasn’t as warmly received in Marina as it might have hoped. When Cal Am and its supporters in the hospitality industry complain about obstructionists and those who would destroy the Peninsula’s economy, Marina officials don’t quiver the way their counterparts in Monterey, Seaside or Carmel might.

RATIONALE

Anybody who is anybody in the world of water testified before the Marina council. Cal Am argued that there was no reason not to proceed. Time’s a’wasting, the company emphasized. Representatives of the hospitality industry, who had pressured employees to attend, warned of dire economic consequences if the vote went the wrong way. Cal Am critics argued that Cal Am and the industry have made an unholy alliance with hotel officials supporting Cal Am in exchange for a sweetheart arrangement on water rates.

The meeting went on forever.

In the end, the Marina council voted 3-2 to require that Cal Am perform an environmental impact report before proceeding with the test well.  Council members said they were concerned primarily about the well’s potential impact on the surrounding groundwater in the Salinas Valley aquifer. They also were concerned about whether the pumping would violate the water rights of other property owners.

The technical grounds for the decision are important now for legal reasons. The council members in the majority—David Brown, Frank O’Connell, and Gail Norton—said they felt compelled to vote as they did no matter how they felt about the desalination plant and the threat of economic harm to the community. Clearly, they said, pumping a large amount of water along the shoreline could have significant environmental impacts, so the law requires full exploration of the potentials.

Councilman Brown won re-election last week despite falling into disfavor with Farr. He explained the thinking in a subsequent email to Farr. He noted that the other two lawyers on the council agreed with his analysis:

“First, I did not vote against desal, or desal in Marina. I simply voted to require an EIR. Second, our CEQA (California Environmental Quality Act) attorney explained the matter as somewhat analogous to a motion for summary judgment, namely if there is opposing environmental evidence on both sides of the issue, from experts, as to the possibility of environmental harm to Marina’s 180-foot aquifer, we don’t weigh the evidence, we simply note the conflict and then require an EIR.

“There was expert testimony from engineer Brian Lee of (Marina Coast Water District) of such harm. I viewed the matter as more of a legal one than anything else, and as an attorney I felt I had to respect that process . . . . You may recall that a few months earlier, I voted to approve (in a 3-2 vote) Cal Am’s bid to drill temporary boreholes at the Cemex plant, for water-quality testing. I voted that way because it was clear there would be no significant environmental impact.”

APPEAL PROCESS

Cal Am quickly appealed to the Coastal Commission, which has the power to overturn local jurisdictions in cases involving significant public works projects.

The commission staff is recommending that the commission grant the test well permit. The staff’s legal argument is largely that the City Council did not properly document its position in the context of the city’s coastal protection plan as approved by the commission and that the overriding issue, the Peninsula’s water supply, is more important than an EIR.

The staff found that alternative locations for the test well and the desalination plant itself are more environmentally vulnerable than the already developed Cemex site. The staff also found that the public interest compels approval of the test well because progress on the project is necessary in order for the Peninsula to eventually abide by the state’s water cutback order.

The staff did concur with the City Council in places. It said the test well plan is inconsistent with the city- and commission-approved coastal habitat protection plan and that numerous requirements should be attached to the permit to assure that Cal Am protects the site to the greatest extent possible and is responsible for eventual cleanup.

One thing that is curious about the staff report is that it keys on the city’s rationale for essentially denying the permit but does not include a full transcript of the city proceedings.

Tom Moore, chairman of the Marina Coast Water District board, pointd that out in a note to the district engineer.

“Someone brought to my attention the fact that it appears as though the Coastal Commission staff has redacted more than 200 pages from the City of Marina’s transcript of the slant well hearings before the City Council in September.  The online staff report to the Coastal Commissioners on this item for Wednesday’s meeting contains less than 40 of the more than 300 pages of the transcript.”

After listing the missing pages, Moore continued, “I have to say that this boggles my mind.  Who authorized such an extensive redaction, one that prevents the Coastal Commissioners and the public from understanding the entirety of the proceedings that were held before Marina City Council.”

PRO AND CON

Presumably, correspondence on the issue was flowing into the commission in the past weeks. Farr, among others, wrote a letter strongly supporting the permitting of a test well.

Among those writing letters in opposition was the Ag Land Trust, which owns rights to Salinas Valley aquifer water in the area.

“The Coastal Commission, if it follows (the staff’s) wrongful advice, will be taking an ‘ultra viras’ (beyond its power) act and approving an illegal test well which violates CEQA, which fails to address the cumulative adverse impacts of the project as a whole and which will result in an unlawful ‘taking’ of groundwater rights from the Ag Land Trust and other rights holders.”

The Ag Land Trust letter was signed by former county Supervisor Marc Del Piero, a lawyer who has specialized in water, and Richard Nutter, retired Monterey County ag commission

The trust said it owns extensive groundwater rights in the area, including on property adjacent to the Cemex property, and that Cal Am has not produced any evidence that it has any rights to groundwater that would be pumped along with seawater. In its 11-page letter, the trust also said the test well would violate numerous provisions of the Marina coastal plan as approved by the commission and not just the habitat provision cited by the staff.

“The Ag Land Trust understands that there is a water shortage on the Monterey Peninsula. We have not caused nor have we contributed to that problem. It has gone on for decades . . . . The water shortage that is of Cal Am making, by its failure to produce a water supply project in over 20 years, does not justify the commission staff’s proposed illegal taking of our groundwater and property rights and the intentional contamination of our potable aquifers and wells for the sold and private economic benefit of Cal Am.”

So there you have it. Important stuff. And, as always, the Partisan would like to know what you think. You can leave a comment below.

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Surviving Election Night

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Desperate businessman portraitNational elections always leave me feeling blue — not in a Democratic way, but in a depressed way. And that’s how everybody expects the Dems to be feeling after the polls close late today. Depressed.

To believe the polls and prognosticators, the Republicans — who have become simply the party of guns and loathing everything our twice-elected president has ever done — will win a bigger majority in the House and take a slim majority in the Senate.

Of course, a savvy survivor of midterm elections, in which sitting presidents always lose allies in Congress, knows that GOP control of Congress will change absolutely nothing. Republicans have held a House majority for the past two years, and the GOP exercised de facto control of the Senate for six years through a system of 60 percent majorities and anonymous holds on presidential appointees.

This is easily forgotten, even by a Utah Republican congressman who demanded a week or two ago that the U.S. Surgeon General take the lead in the existential fight against Ebola. He completely overlooked that Republicans have blocked the president’s nominee for the top doctor’s post for nearly a year because the National Rifle Association, that leading health care group, ordered it.

The knowledge that nothing will change, except new dance steps among hopefuls for president in 2016, eases my national election blues. As further protection, I will avoid all cable news coverage of the election tonight and any blog coverage chronicling how early returns showing how key races in lots of states other than California are shaping up. I say, to bend a quote by the English rock band Traffic, “See what tomorrow may bring.”

I would rather spend Election Night watching old Marx Brothers movies, reading year-old magazines or playing with our two young cats before they lose all interest in running after any of the 47 cat toys spread around the house like fallen autumn leaves.

Looking more closely at local races, I admit I have an interest in the anti-fracking measure in San Benito County, the Monterey County sheriff’s race, the District 2 supervisor race and the fate of a passel of local tax measures.

But again I can wait until Wednesday to find out the winners and losers. And it will probably be a longer wait to declare the winner in the Seaside mayoral contest, given the past two narrow duels between Mr. Rubio and Mr. Bachofner.

I don’t see a lot of drama in any of the other cities with council and mayoral races, where voters will probably decide to keep the bums in. The outlier, of course, is the Marina Coast Water District, which could undergo another of its periodic, violent mood swings.

When I used to cover elections in a newsroom, one of my methods to survive the hollowed-out feelings at the end of the campaigns was to make a few $1 bets with colleagues on some races. Sometimes I would raise it to $5 if my foe was being both boneheaded and profligate. I won far more often that I lost.

That would take the sting out of knowing that voters in Texas once again returned the stupidest House member, Rep. Louie Gohmert, R-Inhishead, to Washington D.C. I firmly believe they do this with Gohmert to either get him out of town or as a Texas-style Dada art piece.

But sadly, I no longer have folks sitting at nearby desks who are easy marks for Election Night bets. So tonight will be a tad more melancholy than usual.

What’s especially depressing, however, is that none of the $4 billion or so being spent in an orgy of political advertising, polling, consulting and go-fering this election will find its way into my pockets.

The real winners tonight — and you don’t want to bet against this — are the owners of local television chains, cable companies, web sites and other media that gleefully carried all the insane and infuriating video ads for the past few months.

They aren’t getting more gridlock, but “greenlock,” and happy days were here again, indeed, for them.

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Howard Gustafson

Howard Gustafson

Angry exchanges are standard fare for the Marina Coast Water District’s board of directors, especially if Howard Gustafson is engaged in the topic, but one of his recent communications has landed him a formal censure from his colleagues.

It was an email to the full board that resulted in the directors voting 4-1 Monday evening to censure Gustafson. The lone dissenter was Gustafson.

The email was in response to an email from director Peter Le, a Marina engineer. Gustafson’s response is quoted in a memo to the full board from the district’s special counsel:

The problem with Peter Le is he always uses E-mail to submit his stupid ideas instead of doing it in public so we can respond on the expenses Le keeps racking up for the rate payers to pay. You were supposed to come to the job with some understanding of something but you do not understand anything by judging your comments and mannerisms. I can remember all the crap you fed the electoric. Keep everything the same or hold another meeting so I can explain to the public what a reject Peter Le is. Quit hiding behind your e-mails, Le.

Regards, Howard Gustafson

Gustafson said in a brief phone interview Wednesday that he considers Le “stupid” because he had helped end the failed regional desalination project, the Cal Am project that collapsed as a result of delays and criminal conduct.

“You mean the guy that ruined the desalination project? Yeah, I think he is stupid. The guy that beats up on the employees?”

Gustafson said he wasn’t concerned about the censure and expects it to be overturned because of procedural errors

In a letter to the special counsel, Le had complained that, “Over a year and a half, Director Gustafson has called me names on several occasions, and showed disrespects to my values and opinions and unprofessional conduct during Board open and closed meetings.

“You may recall that Director Gustafson called President Moore a moron and me President Moore’s ‘sidekick’ previously. Director Gustafson also stated that I was ignorant and did not understand grading and improvement plants. In his email to all the Directors and the District consultant this morning, attached with this complaint, Director Gustafson called my ideas stupid and made other accusations against me. There were other occasions Director Gustafson showed disrespect and unprofessional conduct to me that I could not recall at this time.”

Le wrote that Gustafson had repeatedly cut him off when he spoke during meetings.

“I am very surprised that the current and previous boards had not addressed the unprofessional conduct and behavior of Director Gustafson.”

In her memo to the board, special counsel Jeanine DeBacker said Le had told her that Gustafson had called Director Jan Shriner a liar at a board meeting. DeBacker wrote that Shriner did not recall that “but did confirm that during both closed and open session during the meeting, she was repeatedly not allowed to hold the floor to comment and otherwise prevented from performing her director duties.”

Gustafson is seeking re-election in the Nov. 4 election and hopes to be joined on the board by former director Ken Nishi. In recent years the board had swung back and forth philosophically. Before Nishi’s departure from the board, they were able to form a voting bloc with Bill Lee at times. More recently, though, the votes of Shriner, Le and Tom Moore have tended to prevail.

Though Gustafson’s agenda is sometimes difficult to decipher, he tends to favor efforts to develop more water resources in order to accommodate growth in Marina and on the former Fort Ord. In private life, he works as a building inspector for the city of Salinas.

Lee is also seeking re-election along with Shriner and editor and environmentalist Margaret Davis.

Gustafson, Nishi and Lee have been endorsed by the Monterey Herald while Lee, Shriner and Davis have been endorsed by the Monterey County Weekly. The Partisan has endorsed Shriner and Davis.

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