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I read with great interest Royal Calkins’ post summarizing the efforts of Public Water Now members and supporters to work for public water to replace private water historically provided by Cal Am.  The comments I have seen thus far in response are from regular commenters on the blog, so not much new interest seems to have been ignited.

I have been an avid supporter of prior and current efforts by many to accomplish the demise of Cal Am on the Peninsula. The ratepayers of the Monterey Peninsula do not deserve to be the receivers of what is now considered the most expensive water rate in the country.   They deserve to have a public agency, which would, in theory, provide much less costly rates, real accessibility to the decision-makers, and the ability to remove from office at the ballot box those officials who don’t live up to the ratepayers’ expectations.

Trouble is, in order to determine the potential for those lofty and necessary goals and dreams, it is more than necessary to consider the entire context of the ongoing war, which has spanned over several decades and has been fought so hard by the few but incredibly committed and knowledgeable men and women on behalf of all fellow Peninsula ratepayers.

But before discussing the hurdles, this point is important.  George Riley, head of PWN, Ron Weitzman of the Water Ratepayers Association of the Monterey Peninsula, Marc del Piero, and dozens of other activists already are fully aware of the challenges. They have toiled long and hard with their own money and time on behalf of all of you who are affected by exorbitant unfair rates. Many people know of them, have read their commentaries and understand that a few people are fighting for all of them.  But I bet very few people realize all the hurdles that must be overcome.  It is my hope that when the public becomes aware of the scope of the effort they will want to join in the fight.

The hurdles are all known:  politics; the difficulties inherent in the process of acquisition, with all of its legalities and uncertainties; timing; gaining the vocal and active major support across the board from a strong majority of affected ratepayers; and, last but not least, money. And there is another important hurdle, the Monterey Peninsula Water Management District.

It is already known that the mayors, as nominal leaders of their cities, have thrown their support to Cal Am from the very beginning, starting with the formation of a joint powers agreement they formed to work “fairly and openly” to bring the most “effective and cost-effective” water supply to their constituents.  That hasn’t worked out. I am not pointing a finger at any individual but am looking at the wide picture. People who seek public office want to stay there, usually for very good and ethical reasons.  However, they find out immediately that, in order to do so, they need the support of the people who have the influence, time and money to promote those influences. Therefore, the heads of cities financially dependent on the hospitality industry are less likely to take public stances that are not favored by those who have influence in that industry. The cost of water is not so concerning to the industry as it has the means to pass on additional costs to their customers.  As we all know, residential ratepayers do not have that option.  But, probably in the minds of the mayors, the ability to keep the Peninsula’s economy humming trumps their willingness to go to the mat against the California Public Utilities Commission and Cal Am. During the past Measure O effort to acquire Cal Am, guess who dumped lots of cash to defeat the measure. Cal Am with support from hospitality big-wigs. Not a surprise.

There is more than one option for the acquisition process but only one is capable of success. California law gives the authority to local governments to acquire land and assets from private utilities, primarily by simple purchase of through eminent domain. The problem is Cal Am will not sell any of its land or assets. it will not be a friendly negotiator in the eminent domain process and it has publicly stated that it does not fear litigation. So, if even the new measure passes, the cost of acquisition would need to be studied, at a rather hefty price. If it clearly concludes that acquisition is feasible and will ultimately lead to a lesser burden on ratepayers, it could then lead to an acquisition process filled with hurdles.

Timing is critical.  If the process of retaining counsel, etc., is stretched out, the first election date might not be until next spring when other local issues and re-elections take place. That might work for the proponents, but any distraction is a problem.  The campaign needs to attract motivated and committed members of the public who will spend their time and money in full support of the measure. Working against that is the fact that the previous measure fell short in each city on the Peninsula.

Aiding the effort, Cal Am has shot itself in the foot with its outrageous rate increases. More and more people are expressing their anger for having to put up with rates that make water almost an unaffordable necessity.  But even so, a critical mass has not yet coalesced to provide PWN and its fellow activists necessary to make a much stronger statement at the polls. I am not sure if the response to Royal’s piece is indicative of that, but the commenters who posted were persons who regularly do so, and didn’t include any or many new names who are coming on board with their anger and concern.   More work needs to be done and it takes time AND money to do so – both hurdles in themselves.

Money. Cal Am has access to as much money as it needs to fight off its opposition.

Finally, there is the water district. There has been talk of creating a new joint powers agency to take up the mantle and provide public water once Cal Am is defeated.  That option is a hurdle by its very nature – joint powers agencies are formed by two or more local jurisdictions.  Given the political bent of current local jurisdictions (e.g., the cities), there is not much reason to believe that a new combination of the same parties would not end up same old same old.   A better choice is the MPWMD. After all, it is a water district with jurisdiction over the entire Peninsula. It has a large and capable staff and a proven leader in its general manager.  However, the district is not clean of internal hurdles either.  It has been incapable of implementing a solution to the long-standing water supply problem (although the voters rejected some options sought by the District). The makeup of its board and how it is selected need a new look.  Five members of the board represent five districts and are directly elected, and that is good.  However, two members are appointed, one by the county Board of Supervisors and other by a city committee.  The problem is that the statute does not dictate that the supervisor must be from a supervisorial district that represents at least part of the water district’s area of responsibility, and the method of appointing a city representative is completely inconsistent with the actual language of the statute.  More importantly, a supervisor from a district other than supervisorial districts 5 and 2 (the ones that cover part of the Peninsula) has never been appointed, but the statute allows for that not to happen.  And, with respect to city reps, while the illegality of the history of appointing a city rep (which nobody really cares about), there should be a separate agreement that the rep chosen should rotate on a regular basis among all of the six Peninsula cities.  As it has stood, one man, the mayor of the smallest city on the Peninsula, has represented all of the cities for decades. Those with more at risk should have the greater opportunity to sit in that seat.

No matter if the new measure is passed and the water district is named to succeed Cal Am, there are some procedural issues that need to be addressed if the public is going to have its expected access. The district board rigidly follows the three-minute speaking rule for public comment. Perhaps members of the public could petition for spots on the regular agenda rather than having to make a point in three minutes.

Further, no one should expect that a public agency would not raise rates. It would when necessary. Hopefully, that would only occur after hearings in which groups ratepayers with similar points to make could be agendized.

The bottom line is, for public water to really work, the board of the district has to be in full support of the effort and the process has to be transparent and accessible with real, not symbolic,  input from the public.

Bill Hood is the former executive director of the Association of Monterey Bay Area Governments. He is also a retired water lawyer and engineer who divides his time between Ohio and Carmel.

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Monterey Downs EIR might not survive close inspection

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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Dale Hekhuis: 1925-2016

DaleHekhuis-400x268Dale Hekhuis of Carmel, an early chairman of the Monterey Peninsula Water Management District board, died Monday at age 90.

Mr. Hekhuis was an avid nature photographer and an activist in local water issues, writing often on the subject for the Herald and the Partisan. He advocated for public ownership of the Peninsula water system, taking a professional approach that was long on research and short on contentiousness.

On his photography web site, he wrote, “I’d walk ten miles for a good wildflower image. Places like Glacier National Park, the Tasmanian Wilderness, the Sydney Botanical Garden, the Berkeley Botanical Garden, Point Lobos, Figueroa Mtn. (near Santa Barbara) and the Hoh Rainforest on the Olympic Peninsula, are where I like to be.”

He graduated from high school in 1943 and immediately enlisted in the Marines, which put him through a college training program at Cornell. After the war, he earned a bachelor’s degree from Michigan State University, a master’s from the University of Wisconsin and a doctorate from Carnegie Tech, where he was recruited by the Central Intelligence Agency. He was sent to Georgetown University to study the Russian language. One of his daily duties while serving in the agency’s Russia bureau was to digest each edition of the Russian newspaper Pravda.

Mr. Hekhuis later worked for the World Bank in New Delhi, India, where he was involved in financing railroads. He next worked for General Electric, where he rose to a vice presidency. He had lived in Carmel for 30 years.

He was preceded in death by his wife, Janet. He is survived by three sons, Stephen and Peter of Carmel and David of Santa Barbara, and four grandchildren.

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Drowning Piggy

About three years ago I posted a “Pocket Guide to Local Water Politics” to help poor confused people like me sort out the crazy quilt of interlaced complexities of competing interests. A lot has changed since then, so I thought an updated guide would be in order. Unfortunately, things have become so insanely complex that I must increase the guide to briefcase size.

Background:

In the mid 1970s California experienced a severe drought. Here on the Monterey Peninsula, residential water users were rationed to 50 gallons per person per day, a huge inconvenience in the days of 3-gallon-per-flush toilets and 5-gallon- per-minute shower heads.

In 1978 the state Legislature created the Monterey Peninsula Water Management District, commonly known as the “Water Board,” to spearhead conservation efforts and find and construct a new water supply so we would never have to go through that again. Nearly 40 years and three droughts later, almost nothing has been done. Despite the cries of “not me” echoing throughout the region, pretty much everyone is to blame.

Here are the players. Their specific names have been removed to protect me from the guilty:

  1. Monterey Peninsula Voters who, in the mid 1990s, voted down two perfectly good water supply projects that would have solved our problems long ago.

Important details:

  • The projects were a modest desalination plant in Sand City and a New Los Padres Dam on the Carmel River.
  • The desal plant would have provided us with a drought-proof supplement to sporadic rainfall. It was rejected by voters in 1993 on the grounds that it would cost much more per unit of water than a new dam, which they said was just around the corner.
  • The dam would have provided ample storage to serve the population and help the poor fish by restoring year-round flows to the overdrawn Carmel River. It was rejected in 1995 because voters perceived it as too expensive, growth-inducing, and environmentally damaging.
  • Had local voters approved both of these projects, we would not be in the legal mess we are in today and the current drought would be just a minor inconvenience.
  • What in blazes were they thinking?!?!?!?
  • For the record: I voted for both projects.
  1. A state water board that determined that the local private water company (see below) was legally entitled to only one third of the water it was pumping out of the ground in Carmel Valley, the Peninsula’s primary source of water for over 100 years. The board issued a cease and desist order (CDO) to take effect at the end of 2016.

Points to ponder:

  • Everyone on the Peninsula is desperate to find a new water supply.
  • There is a general consensus that a desalination plant is the best option.
  • If we don’t meet the deadline, the private water company will be forced to pay huge fines, or limit water deliveries, or some combination thereof. Nobody knows how the state will enforce the order.
  • Oh crap: We’re not going to meet the deadline.
  1. The county, which arbitrarily passed an ordinance saying that any desalination plants built in Monterey County must be publicly owned.

But wait:

  • There is some question as to whether the county has legal jurisdiction over utility companies. Some say that is purely the domain of the California Public Utilities Commission (PUC). If that is true, the county’s ordinance is probably not enforceable.
  • The county doesn’t seem to have a problem with private ownership of the Carmel Valley dams (see below), so why does it care if the same company owns a desal plant?
  • And why single out water? If the same logic applied to other utilities, then electrical generation plants should also be publicly owned, right?  But that’s a topic for another day.
  1. The local water board, which devised and presented two water supply projects to Peninsula voters for their approval.

The results:

  • Voters rejected both projects (see above).
  • After voters rejected the two projects, the water board could find no credible alternatives and has basically been adrift ever since.
  • The water board has since developed a reputation, not fully deserved, as a do-nothing agency.
  • Throughout its history, the water board has been accused of abusing its authority over new water uses to control development on the Monterey Peninsula.
  • Its reputation was so bad that in 2002 Monterey Peninsula voters passed an advisory measure asking the state Legislature to dissolve it. Presumably, had the Legislature complied – which it didn’t – that would have left the private water company (see below) on its own to develop a water supply.

5.    The private water company, which has been the Monterey Peninsula’s water provider for as long as water has been needed here.

Some facts:

  • Although The company has “California” and “American” in its name, the parent company is actually based in Germany. (CORRECTION: That is no longer true. It was reorganized as a U.S. company.)
  • In the first half of the 20th Century, the private water company built two dams on the Carmel River called San Clemente and Los Padres.
  • The company has been criticized for not dredging the two reservoirs periodically, instead letting sediment build up, which significantly reduced their capacity.
  • The San Clemente reservoir filled almost completely with sediment. The dam is currently being dismantled at customer expense.
  • For over three decades the company let the local water board take the lead in finding a new water supply project.
  • When the local water board failed to deliver, and with the cease-and-desist order deadline fast approaching, the company entered into a complex agreement with a neighboring water district (see below) to build a Regional Desalination Project (RDP) outside the neighboring private water company’s service area.
  • After the agreement with the neighboring water district collapsed (see below), and with the cease-and-desist order deadline imminent, the private water company understandably gave up on working with incompetent public bureaucracies and decided to build a desal plant on its own. Plans call for it to be built within the boundaries of the neighboring water district, which has generated considerable friction between the company and the neighboring water district.
  • The most optimistic construction schedule shows the company’s desal plant won’t be operational until 2020, thus missing the deadline by about four years.
  • The company has skirted the county requirement that desal plants be publicly owned through some sort of agreement that resolved whatever disputes arose between the company and the county during the failure of the Regional Desalination Project.
  • The company hopes to employ “slant well” technology to draw ocean water into the desal plant. Slant wells are drilled near the shore at an angle (as opposed to straight down) so that the intakes are located in the soggy sand just below the ocean floor.
  • Slant wells are preferred over “open ocean” intakes by environmental groups and regulatory agencies because they will not suck up ocean life along with the seawater. However, critics in the neighboring water district believe the slant wells will also draw some fresh water from the neighboring district’s groundwater supplies, and they, along with a neighboring property owner, are accusing the private water company of stealing their water.
  • Earlier this year the company drilled a slant well for testing purposes to determine if the technology will work as expected. The test well was challenged in court by the neighboring water district, but a judge allowed the test to proceed.
  • The slant well testing is so far inconclusive. The company discovered a drop in groundwater levels in the neighborhood of the test well. It is not yet known if the drop was caused by the slant well or nearby agricultural wells. The company says it is the latter while the neighboring water district says “Nya, nya, we told you so!” The test well is currently shut down pending further analysis by actual scientists.
  • Egg on their faces: It turns out that one of the consultants hired by the company to analyze the test well results has a conflict of interest in that he also holds some patents on slant well technology.
  1. The neighboring water district came into the picture a few years ago with a proposal to save the private water company from the ineffective water board. It was called the Regional Desalination Project (RDP).

Here’s where everything went completely bonkers:

  • The RDP plan involved three public agencies. 1. The neighboring water district, which would own the desal plant, 2. A county water agency, which would own the pipes to get ocean water into the plant, and 3. A regional wastewater agency, which would be in charge of the salty residue discharged back into the ocean.
  • The private water company would be the plant’s primary customer. The neighboring water district would also use some of the water produced for its own needs.
  • The neighboring water district would have control over the plant management and operations.
  • The private water company’s customers would pay for the plant, but have no significant influence over its management. This raised alarm bells among Monterey Peninsula residents who felt that they would be at the mercy of the neighboring water district, which at the time was widely regarded as so dysfunctional that the Peninsula’s useless water board looked like King Solomon by comparison.
  • The California PUC’s Division of Ratepayer Advocates had similar concerns.
  • Due to the sheer complexity of the plan and the distrust it generated among Peninsula residents, the project probably would have collapsed under its own weight eventually. Its demise was mercifully hastened when it was discovered that a key player in the project’s development had a serious conflict of interest in that he was working for both a public agency and a private contractor advising the same agency.
  • As I predicted in 2010 the RDP players are now suing each other, trying to recover the money they spent on this unworkable scheme. Each side claims the others were at fault, and nobody is taking responsibility themselves.
  • Meanwhile, the neighboring water district, being no longer on speaking terms with the private water company, is trying every legal trick in the book to stop the private water company from building its own desal plant within the boundaries of the neighboring water district.
  • Last May the local Congressman actually suggested that the neighboring water district be disbanded because “They just haven’t conducted themselves in a very professional way. They’ve been fighting everybody else, and they’ve been sort of selfish and arrogant.”
  • Isn’t this fun???
  • Only if you can watch it from a safe distance!
  1. After the RDP collapsed it became evident that none of the relevant public agencies was competent enough to find a new water supply. So the six mayors of the six Monterey Peninsula cities got together and formed a plan: Create a new public agency! They call it the water authority, and the mayors put themselves in charge.

Their mission:

  • Get all the players, the public water agencies, the private water company, the business association, and the citizen groups into one room and hash out a solution agreeable to everyone. It’s sorta like herding cats, and has turned out to be just as effective.
  • The authority analyzed three competing desal plant proposals (see above for one and look below for the other two) and voted the private water company’s project as Most Likely To Succeed. This pleased the private water company (see above) and local business association (see below), and really upset the citizen groups (see below) and the neighboring water district (see above).
  • Just to be safe, the authority declared the Deep Water project (see below) as its second favorite. The mayors directed the water board to oversee the Deep Water project on a parallel track as a “Plan B” in case the private water company’s project fell apart. Good idea.
  • The authority is also exploring the best ways to grovel before the state sater board to request an extension of the CDO deadline.
  1. A prominent local businessman who, for several years now, has claimed to have the perfect desal plant idea called he People’s Project.

All you need to know:

  • It would be built on property he owns adjacent to the Moss Landing power plant.
  • It would use existing seawater intakes (built in the 1940s) used by a previous business on the same site. The prominent local businessman theorizes that using existing intakes will be okey-dokey with the ocean protection people.
  • One problem: His property is currently under threat of foreclosure.
  1. Deep Water Desal is the “Plan B” of the water authority.

The basics:

  • That’s actually its real name. I couldn’t come up with a generic pseudonym.
  • It is so named because the ocean intakes would be located in a deep part of the ocean where fewer critters live to get sucked into the pipes. Its proponents believe that this will be acceptable to the ocean protection people, but nobody knows for sure.
  • According to recent news reports, the project directors claim that they can get the plant up and running sometime in 2017, missing the CDO deadline, but only by a few months instead of several years. However, their website does not show a timetable, not even on their “Costs & Timeline” page, which only mentions costs and financing. The project does not yet have an environmental impact report (EIR), which will take the better part of a year to prepare. Construction can’t begin without it.
  • … 2017 is only 16 months away!
  1. A handful of citizen groups are also in the mix. Their favorite activity is writing mind-numbing guest commentaries in the local newspaper, almost every week for the past few years.

What they say and do:

  • They say the private water company is a greedy, heartless corporation that is only interested in profits and doesn’t care about its customers.
  • They blame the private water company for all of our water problems. To justify that conclusion they have implied that Peninsula voters, the water board, and the neighboring water district are all perfectly angelic innocent victims of the company.
  • They are absolutely convinced, and believe it should be obvious to everyone, that only thing that will save us from the private water company is a public takeover of the private water company.
  • Twice in the last ten years they have put measures before voters to study the feasibility of having the local water board take over the private water company. Yup, we’re talking about the same local water board the voters voted to remove from the face of the Earth (see above). Needless to say, both ballot measures failed.
  • Members of these groups reluctantly admit that they underestimated the depth of public animosity towards the local water board, but they still insist that the measures would have passed if the private water company hadn’t spent so much money on the NO side of the campaign.
  • Golly, they’re so cute when they fantasize.
  • They oppose the private water company’s desal plant, and support the other two (see above).
  • They declared that the private water company’s slant well test would be a failure even before the test well was drilled. They have even accused the private water company of knowing it would fail before it was drilled. When asked for evidence they tend to get unusually quiet.
  • To their credit they have rightly questioned why businesses pay lower water rates than residential customers.
  • But they’re into conspiracy theories. For example, because the mayors’ water authority supports the private water company’s desal plant, they say that the authority is in cahoots with the company to keep business rates low and residential rates high.
  • They’re really into conspiracy theories. They say the conflict of interest problem that killed the neighboring water district’s Regional Desal Project was deliberately manufactured by the private water company to kill the RDP and leave the company free to build its own plant so it could keep all of the profits. Problem with the theory: The company was free to join or not join the RDP agreement, so there was no need to resort to devious means to get out of it.
  • They insist that if the state Water Board imposes fines on the private water company for failing to meet the CDO deadline, then the company’s stockholders should pay the fines, not water customers. Their reasoning: We all know that the private water company is to blame for everything, and the voters and local water board are completely innocent. Right? Right?
  1. Finally, there is a business association, which is solidly backing whatever water project looks most promising at any given point in time.

More details:

  • Their spokesperson is a well known general manager of a prominent Monterey hotel.
  • The association is scared to death of the CDO because if water deliveries are forcibly curtailed, then many, many businesses would be forced to cut back services and eliminate jobs. Hotels and restaurants would be especially hard hit. It’s a legitimate concern.
  • Even if the state Water Board imposes fines instead of water cutbacks, the cost of water would increase the cost of doing business, costs which may have to be passed onto customers.

So there it is, the whole situation in a nutshell. No, that’s wrong. It’s a freakin’ nuthouse! Don’t feel bad if you don’t understand it. It is all quite incomprehensible to any sane person. If, by chance, you think you do understand it you are advised to seek psychiatric help as soon as possible.

This first appeared on one of James Toy’s blogs, Mr. Toy’s Mental Notes.

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????

The following is my Aug. 7 letter to the California Coastal Commission’s executive director, Charles F. Lester, regarding the Cal Am test well:

Dear Mr. Lester,

Public Water Now (PWN) is the group that discovered the patents owned by Dennis Williams and Geoscience. PWN alerted the public about potential conflicts of interest. PWN is also the group that has harped on the phrase issued by the State Water Resources Control Board about pursuing subsurface intakes, “if feasible,” prior to pursuing other options.

I am writing to alert you to related issues that I hope you consider in the review of an amended permit for Cal Am, and the follow up monitoring and evaluation of data and circumstances re this test slant well.

PWN is well aware of the desire by you, the State Water Resources Control Board, California Public Utilities Commission, and others in the state that want a successful subsurface intake for desal facilities. PWN is also aware of the environmental reasons, and we do not disagree.

But PWN strongly objects to several factors that are in play, and you have a role in considering them.

How does the CCC remain objective and focused on the facts when it has a obvious public policy to support subsurface intake? PWN questions the depth of objectivity CCC will bring if the overlying policy goal is a successful subsurface intake for desal. Will CCC go the extra mile to guarantee its objectivity and interest in validated data and analysis? Is the CCC open to looking beyond the face value of the data it receives?

The patent royalty relationship between Dennis Williams/Geoscience and the driller –Boart Longyear – has not been queried. Is it possible that substantive financial relationships exist between these two that could cause the data to be skewed to serve ulterior motives? Will CCC look into the contract relationship between Williams and Boart Longyear? Will CCC determine there are no royalty and shared self interests in the contracts or in the actual test well operations that could skew their reports?

Will CCC question the financial relationship of these key sources of data and opinion?

PWN has felt for some time that the specific test period got cavalier treatment by the CCC. I made this very point at your hearing in November 2014 on the initial permit. Since slant wells are not in use anywhere in the world, how can CCC not absolutely insist on a valid test period? Not knowing what is a valid period, surely sophisticated professional attention is required. What is a valid test period? Will CCC opine on this? Will CCC prescribe a valid duration for the test period?

The only known subsurface intakes for desal have occurred in California – Dana Point and Sand City.

1) Dana Point results after 18 months of test slant well pumping are these: no conclusions on viability; some sand infiltration problems; and pumping efficiency declined from over 90% to about 55% over 18 months.

2) The data from the Sand City vertical subsurface wells for a small 300 acre foot/year plant shows actual pumping efficiency over 4 year of operation to be in serious decline:

From Sand City Public Works, calendar year:

  • 2011 96.8%
  • 2012 69.6%
  • 2013 64.8%
  • 2014 60.8%

From Monterey Peninsula Water Management District, water year

  • 2011 91.9%
  • 2012 80.7%
  • 2013 62.3%
  • 2014 59.5%

This data on Sand City tells a very negative tale about reliability, and therefore viability. Why does pumping efficiency with subsurface intake decline so significantly over a few years? Dana Point and Sand City data clearly make this point! Has the CCC considered this? This is why a valid test period is critical. Experience so far does not dictate a “full speed ahead” mentality. In fact it screams out for caution. And to be skeptical about any optimism about short term data. The telling will be in the testing, and in the duration, not the first data available.

Will CCC require a legitimate test period of two years or more? Remember, Cal Am originally proposed a two year test period. But with unexplained lower performance at Sand City, is two years adequate?

Every diagram example in all sources describe slant wells as penetrating far enough under the sea floor to extract water from beneath the sea floor. The intent is clear – to avoid aquifer interference, and perhaps to avoid related water rights claims. But the Cal Am test well does not penetrate the vertical line at the mean high tide line. It stops landward of that line. Would this “test well” meet your normal standard for a test of under sea floor intake? The fact that it did not extend under the sea floor area should raise questions about design or engineering?

Was the drilling length too risky or difficult? Was the drilling capacity limited in some way? Is this an issue for feasibility? Was the design under the patents too limiting? Should horizontal directional drilling still be an option? Are there more experiments that should take place? Did the insistence on the removable casings create engineering demands that were excessive? Could the guidelines from the State Water Board have established too high a level of outcome that was too expensive for success? The fact of a shorter test well length than intended (by the proponent, the patent holder and the public promotion) must get questioned regarding its use as a “test”?

Furthermore the plan of Cal Am to proceed directly from a short test period into a development permit for nine production wells makes a farce of all the publicity about the “test well” being a legitimate test well! The plan of Cal Am is based on assumptions, not tests. There are enough questions about long term performance reliability and cost acceptability that should ring alarm bells at the CCC, and elsewhere.

Working out the details and the costs of this experiment should not fall on the ratepayers. This is a state-sponsored requirement, and should have significant state funding. I doubt you have access to funding assistance. At least you might acknowledge the unfairness of the state, and the corporate utility, foisting this unproven and little scrutinized experiment on ratepayers.

The CCC, having jurisdiction over the efficacy of slant well impacts, and having a deep interest in the long term success of subsurface intakes, should have a particular interest in seeing that it is done right. This is too new for the CCC to feel comfort in self-interested promoters and contractors.

Whatever happened to the precautionary principle?

If there is to be a successful test, there must be conscientious and professional attention to the fact that slant wells have never been successfully constructed and become operational anywhere in the world.

Costs can become astronomical, and should not fall exclusively on local ratepayers. State resources must be made available, since it is a policy goal of several state agencies for subsurface intakes. And the facts of declining pumping efficiency should also raise alarms.

We sincerely hope you will take these issues into account during deliberations and analysis of Cal Am’s amended permit.

Respectfully,

 

George T. Riley
Managing Director
Public Water Now

Emailed to: tom.luster

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Clean Drinking WaterThe draft environmental impact report on Cal Am’s proposed desalination plant concludes that the controversial operation would have “less than significant” impact on groundwater, salt water intrusion and Monterey Bay water quality, the subjects of serious concern among opponents of the slow-moving project.

The report was made public Thursday on the state Public Utilities Commission website, setting off a 60-day comment period.

Environmental Science Associates, which prepared the dense, 1,700-page document, also concludes that construction of a smaller plant obviously would have less of an environmental impact even if combined with a new groundwater replenishment project.

Environmental groups and the Ag Land Trust, which owns property next to the project site on the Cemex property north of Marina, have contended that the plant’s pumps would illegally suck up fresh water belonging to others, including water long claimed by Salinas Valley growers. The EIR agrees that fresh water would be drawn in, possibly more than Cal Am’s engineers expected, but it estimates that the plant would draw down the water table in the area by no more than a foot. It labels that a less than significant impact, one that would not require any mitigation.

The report mentions that the Ag Land Trust says it operates a well about a mile from the plant site but an EIR subcontractor couldn’t find it and the State Water Resources Control Board has no record of it. The trust has been sharply critical of the project.

It is possible, according to the report, that the desalination operation actually could ease seawater intrusion by drawing fresh water toward the ocean.

The report says brine discharged by the plant would violate water quality standards in the bay but indicates that the damage could be mitigated. Some scientists have opined that the brine is likely to settle on the floor of the bay and create a dead zone.

Clean Drinking WaterCal Am is under pressure to create a new water supply because of a state order that it dramatically cut back on its use of Carmel River water by the end of next year. With the desalination process slowly slogging through the engineering and regulatory processes, local officials have given up on the 2016 deadline and are pleading with state officials to push the deadline back by several years.

Copies of the report are available at the Monterey Peninsula Water Management District and Monterey Regional Water Pollution Control Agency offices in Ryan Ranch, at the Marina and Seaside community development departments and at some area libraries.

A series of public meetings is scheduled to start May 26 at the Marina library.

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When a state administrative law judge proposed an $870,000 fine against Cal Am for illegally charging its customers for projects that had not been completed, or in some cases not even started, company officials said they were “shocked.”

“It’s not like it was a safety issue or an environmental hazard,” said Cal Am spokesman Kevin Tilden, who apparently doesn’t consider gouging ratepayers to be a serious matter.

Tilden went on to say it was all just a big misunderstanding.

“There was no intent to deceive.”

Which could be true. But if it is, then what Cal Am did to warrant such a fine amounts to severe incompetence or something equally troubling, in the eyes of the state Office of Ratepayer Advocacy. The ORA is the official Public Utilities Commission offshoot that discovered how Cal Am had been collecting large amounts, very possibly in the millions of dollars, by falsely claiming that at least $79 million worth of construction or maintenance projects had been completed.

“Cal Am’s purported interpretation of this (reporting requirement) deviates so far from the plain language of the (PUC rules) as to constitute at least gross negligence,” the ORA wrote in a legal brief last year.

In another brief, the agency was slightly more charitable:

“Whether deliberate or simply a result of abysmal recordkeeping, Cal Am’s woefully inadequate response (to the ORA’s findings) is a breach of duty to this commission but also to its customers who have been billed for projects that have never been constructed.”

In a nutshell, as part of its request for future rate increases, Cal Am told the PUC three years ago that five construction or improvement projects on its books had not been completed. ORA staffers, however, suspicious of that number, took a road trip around the state in search of projects that Cal Am was billing for but that might not exist. They found more than five incomplete projects. More than 10. More than 20. They found 62.

A few of the projects, none major, were in Monterey County. The others stretched from San Diego to Sacramento.

Cal Am pleaded ignorance, confusion or a combination of the two. Some of its top officials testified in a PUC hearing last year that they thought the PUC only wanted to know about projects that Cal Am believed would never be completed. As opposed to projects that simply had not been completed.

The Office of Ratepayer Advocates doesn’t buy it, asserting that even when the discrepancy was discovered, Cal Am made no apparent effort to correct it or delve into the cause.

ORA lawyers also argued that it would not come as a surprise if the company wasn’t handling the rest of its affairs in similar fashion.

The Office of Ratepayer Advocacy was once a division of the Public Utilities Commission but was officially separated into an independent agency in order to protect it from bureaucratic or political interference. ORA lawyers argued in this case that the agency has spent so much time on the unfinished projects matter that it has been diverted from its larger mission of studying the utility’s support for upcoming rate increases.

Because of the complexity of utility accounting and Public Utilities Commission regulations, it is difficult if not impossible to accurately determine how much money Cal Am improperly collected from its customers. The commission’s files do contain enough information, however, to support a guesstimate. By Cal Am’s accounting, customers were being charged for just $3.6 million in incomplete work. By ORA’s accounting, the figure was more like $79 million. If Cal Am collected for the higher amount for just one year, customers could have been overcharged at least several million dollars, according to a PUC staffer who was not authorized to speak publicly.

ORA officials calculated that PUC rules would allow a fine of as much as $35 million, but the agency recommended a figure between $29,000 and $2.9 million.

Without determining whether Cal Am had deliberately or accidentally misled the PUC, Administrative Law Judge W. Anthony Colbert this week recommended an $870,000 fine. He said he wanted to set a figure that would send a message to the company but that would not unduly strain the company’s resources.

Colbert wrote that the PUC rules violated by Cal Am were “clear and direct” and found that the company’s explanation was “unsatisfactory.”

To the disappointment of Cal Am, Colbert also found that the company’s behavior amounted to an obvious violation of the Public Utilities Commission’s cardinal rule, otherwise known as Rule 1.1. It says that anyone who transacts business with the PUC “agrees to comply with the laws of the state … and never to mislead the commission or its staff by an artifice or false statement of fact or law.”

The amount of the fine will be determined at some future meeting of the PUC, a body of five political appointees. Unfortunately, whatever the amount turns out to be, it will go to the state general fund instead of being refunded to Cal Am customers. The only consolation to the ratepayers will be that Cal Am will be ordered not to pass the costs of the fine on to the customers.

Of the 72 unfinished projects that Cal Am should have disclosed, a handful were in Monterey County. None has had a high profile.

One involved the drilling of a well at Seaside Middle School as part of the Monterey Peninsula Water Management District’s aquifer storage and recovery project, at a cost of $496,000. The ORA found that the project was completed but that the funding had come from the water management district.

According to ORA, other projects that should have been reported as incomplete earlier this decade included a $203,000 replacement of a water tank that was instead taken out of commission, a $5.4 million effort to replace water mains in Seaside, construction of a fish passage at Los Padres Dam at a cost of $2.3 million, and replacement of a mainline distribution valve at a cost of $115,000.

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