January 7, 2011

President Michael R. Peevey
California Public Utilities Commission
505 Van Ness Avenue
San Francisco, CA 94102

SUBJECT: Support for Application No.10-01-0122 to Continue Collection of Monterey Peninsula Water Management District User Fee for Carmel River Mitigation Program and Aquifer Storage and Recovery Project

Dear President Peevey:

The Carmel Valley Association has been actively participating in water issues affecting our area since 1949. Representing hundreds of families, we are the only residents’ association speaking for all the Carmel Valley. Our members have spent many thousands of hours working with the Monterey Peninsula Water Management District (MPWMD) and public environmental agencies and organizations in efforts to save our valley from further environmental degradation and from the past effects of over-drafting the Carmel River aquifer.

Our Board strongly supports the Carmel River Mitigation Program and the Aquifer Storage and Recovery Project, along with the MPWMD user fee that supports these programs. We believe the December 2010 Proposed Decision by Administrative Law Judge Maribeth Bushey directly threatens these programs, along with threatening the productive partnerships between Cal-Am, MPWMD, the public, and the dozens of other governmental and non-governmental organizations who are participating in these projects.

  1. The Proposed Decision does not acknowledge 20 years of successful environmental improvements. The Carmel River Mitigation program is successfully restoring the river – including erosion controls, fish and wildlife management and lagoon management. Surface and groundwater monitoring programs help ensure future success in this effort, along with the health of our future water supply. This is a complex undertaking, requiring cooperation from multiple governmental agencies. It is unlikely it could be successful without the technical resources of MPWMD and their dedication to public process.

  2. The Proposed Decision does not acknowledge the importance of the ASR Project to present and future water supplies. The ability to store excess Carmel River water in winter months, and thereby reduce summer diversions, is absolutely necessary to meeting the year-to-year requirements of the State Water Resources Control Board 95-10 ruling, and also is an integral part of the Regional Water Plan desalination project. And like the Carmel River Mitigation Project, the ASR project is technically difficult, involves working with multiple public agencies, and needing public support. Apparently the ALJ is unaware that the ASR Project is an essential element of the Regional Plan, and in approving the Proposed Decision the CPUC would be directly undermining their recent decision approving that plan.

  1. The Proposed Decision states (illogically) that the MPWMD funding arrangement is not in the public interest. The ALJ argues that the fee based on volume of water used is unfair to current users. All of the funded projects – Carmel River Mitigation, ASR, and conservation -- are required to mitigate past over-drafting of the Carmel River Aquifer. They are not designed to expand water supply for future growth. Given that it’s not realistic to collect damages from past users, charging the cost of past damages to current users is more equitable and prudent than shifting those costs to future users through the sale of bonds or other borrowing. These programs and their funding have received on-going public support, including support by the Division of Ratepayer Advocates (DRA).

  1. The Proposed Decision claims a lack of accountability. Given the public fish bowl that MPWMD operates in – from budgeting these projects through reporting on their results – this accusation is unfounded. The CPUC should not accept this assertion without inviting a full response from Cal-Am and MPWMD. As the accusation now stands, without an opportunity for rebuttal, it is potentially more damaging to the credibility of the ALJ and the CPUC than of those accused.

The Carmel Valley Association strongly encourages you to approve Cal-Am’s Application No. 10-01-012 and to modify the Proposed Decision to accept the Settlement Agreement among Cal-Am, MPWMD and DRA. If needed, a public hearing should be set to resolve any questions remaining. As Carmel Valley residents we feel we have an extensive stake in the outcome of your decision, both as ratepayers and as caretakers of the Carmel River and our valley.

Thank you for giving careful attention to our concerns,


Todd Norgaard
Chair, CVA Water Committee

Christine Williams
CVA President