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Agenda

Monterey Peninsula Regional Water Authority (MPRWA)


Regular Meeting

7:00 PM, Thursday, January 9, 2014
Council Chamber
580 Pacific Street
Monterey, California

ROLL CALL

PLEDGE OF ALLEGIANCE

REPORTS FROM BOARD DIRECTORS AND STAFF

PUBLIC COMMENTS
PUBLIC COMMENTS allows you, the public, to speak for a maximum of three minutes on any
subject which is within the jurisdiction of the MPRWA and which is not on the agenda. Any person
or group desiring to bring an item to the attention of the Authority may do so by addressing the
Authority during Public Comments or by addressing a letter of explanation to: MPRWA, Attn:
Monterey City Clerk, 580 Pacific St, Monterey, CA 93940. The appropriate staff person will contact
the sender concerning the details.

APPROVAL OF MINUTES

1. December 9, 2013 Special Meeting

AGENDA ITEMS

2. Approve Certificate of Appreciation to Deanna Allen of the City of Carmel for Financial
Services to the Authority

3. Authorize Contract Extension for Brownstein, Hyatt, Farber and Schreck for Legal Services
Cullem

4. Receive Update on the Pro-Rated Cost Share Requests from the County of Monterey -
Cullem

5. Approve and File Checks Through December 31, 2013 - Cullem

6. Year End Budget Review for Calendar Year 2013 - Cullem

7. Receive Update on The 2012-2013 Financial Audit Report Cullem

ADJOURNMENT



The Monterey Peninsula Regional Water Authority is committed to include the disabled in all of
its services, programs and activities. For disabled access, dial 711 to use the California Relay
Service (CRS) to speak to staff at the Monterey City Clerks Office, the Principal Office of the
Authority. CRS offers free text-to-speech, speech-to-speech, and Spanish-language services
24 hours a day, 7 days a week. If you require a hearing amplification device to attend a
Created date 01/07/2014 11:47 AM Thursday, January 9, 2014
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meeting, dial 711 to use CRS to talk to staff at the Monterey City Clerks Office at
(831) 646-3935 to coordinate use of a device or for information on an agenda.

Agenda related writings or documents provided to the MPRWA are available for public
inspection during the meeting or may be requested from the Monterey City Clerks Office at 580
Pacific St, Room 6, Monterey, CA 93940. This agenda is posted in compliance with California
Government Code Section 54954.2(a) or Section 54956.



MI NUTES
MONTEREY PENINSULA REGIONAL WATER AUTHORITY (MPRWA)
Special Meeting
12:30 PM, Monday, December 9, 2013
SEASIDE COUNCIL CHAMBER
440 HARCOURT AVE
SEASIDE, CA 93955
MONTEREY, CALIFORNIA

Directors Present: Burnett, Edelen, Kampe, Pendergrass, Rubio, Della Sala

Directors Absent: None

Staff Present: Executive Director, Legal Counsel, Clerk, Consultant Alex Wesner

ROLL CALL

President Della Sala called the meeting to order at 12:34 p.m.

PLEDGE OF ALLEGIANCE

REPORTS FROM BOARD DIRECTORS AND STAFF

Vice President Burnett reported regarding the California Public Utilities workshop on December
2, 2013 indicating the focus of questioning was regarding the size of the desal facility and that
he had the opportunity to speak about the Authority position of sizing and the need to have
water for lots of record and economic rebound. Director Pendergrass spoke to the passing of
Monterey Peninsula Water Management District former General Manager Darby Fuerst.
Executive Director Cullem spoke to the TAC Special Meeting that preceded this meeting and
indicated that their recommendation will be provided at the appropriate time on the agenda.

PUBLIC COMMENTS

President Della Sala invited public comments and had no requests to speak

APPROVAL OF MINUTES

On motion by Director Pendergrass and Seconded by Director Rubio and approved by the
following vote the Authority approved the minutes of October 31, 2013 Regular Meeting,
November 14, 2013 Special Meeting and November 14, 2013 Regular Meeting.

AYES: 6 DIRECTORS:
Burnett, Edelen, Kampe, Pendergrass, Rubio, Della Sala
NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None

1. October 31, 2013 Special Meeting
Action: Approved

2. November 14, 2013 Special Meeting
Action: Approved

3. November 14, 2013 Regular Meeting
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Monterey Peninsula Regional Water Authority
Special Meeting Minutes - Monday, December 9, 2013
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Action: Approved

AGENDA ITEMS

4. Review, Discuss and Provide Recommendations on draft SPI Report to the Monterey Peninsula
Water Supply Project (MPWSP) Design Build Consultant selection process (Alex Wesner)

Executive Director Cullem introduced Alex Wesner, Separation Processes Inc (SPI) who was
contracted by the Governance Committee Members to participate in the selection process for
the design build firm for the Monterey Peninsula Water Supply Project. Mr. Wesner provided a
detailed presentation of his involvement in the selection process for the Design Build contract
for the MPWSP on behalf of the Governance Committee. His role was to review relevant
documents, including statement of qualifications, Request for Proposals, proposal responses,
questionnaire response and evaluation reports. He also attended meetings including interviews
with the contractors, proposal scoring sessions and negotiations with selected Design Build firm.

Mr. Wesner spoke to the technical specifications that were included in the contract negotiation
process and provided evidence of the justifications for selection of the firm CDM including price,
design ideas and site plan. He explained that the process was prescriptive to respond to specific
technical criteria yet allowed the bidders to submit voluntary alternate proposals for flexibility.

Mr. Wesner then provided the following schedule highlights proposed by the selected contractor
CDM (*This time frame is contingent upon the success of the test wells.) then answered
questions from the Directors.

GWR Capacity Decision: October 2015
Final Design/Construction Start Nov 2015
Initial Start up at for 6.4 MGD Sept 2017
Final Start up for 9.6 MGD March 2018

Director Edelen spoke in support of the design build selection process with regards to flexibility
and interaction with the project opportunities and proposals. He indicated that Cal Am should be
congratulated for the flexibility which resulted in detailed responses and unanticipated financial
benefits. Vice President and TAC Chair Burnett read an email from Legal Counsel McLaughlin
into the record indicating Attorney Wes Strickland reviewed the proposed contract and
concluded that the agreement was well drafted and fair. One further item is being explored
regarding meeting coordination, but feels it is ripe for approval by the Governance Committee.

President Della Sala expressed surprise by the minimal difference in the unit cost between the
6.4 MGD and 9.6 MGD facility and then questioned the level of electricity needed for operating
the two proposed systems. Mr Wesner indicated that energy usage figures were outside the
scope of the proposal but all projects were required to have efficiently operating equipment.

President Della Sala invited public comments.

David Lifland spoke to the cost of the slant wells and brine disposal not included in the
proposals. Spoke to the pre-filter and the iron and manganese issue indicating that long
term operations will still need them and he questioned the capacities of the proposed
systems, speaking in support of expansion capabilities. Finally, he questioned the
warranty policy if it could include replacement or proper maintenance.

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Monterey Peninsula Regional Water Authority
Special Meeting Minutes - Monday, December 9, 2013
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Chair Burnett reported on the recommendations made by the TAC at the previous meeting and
Executive Director Cullem spoke to the following additional suggestions to be recommended to
the Governance Committee.

Recommended changes to the contract:
1) Request Cal Am to look into locking-in the price of reduction in the event the
filters are not needed if iron and manganese are not needed and any other areas
that could be locked in
Suggestions for further review:
2) Looking at oversight of quality control and QA
3) Clarification when the value engineering exercise begins
4) Identify the critical path schedule that the public agencies and the public can look
to ensure the project stays on schedule

Director Kampe questioned exactly what is included in Quality Assurance or Quality Control and
questioned if an analysis was doing to determine if savings on capital costs has any impact on
operational costs.

Mr. Wesner responded to technical questions asked about the process and the treatment
needed under specific circumstances.

On motion and approved by the following vote the Monterey Peninsula Regional Water Authority
accepted the TAC recommendation as the Director recommendation to be forwarded to the
Governance Committee as follows.

To endorse the selection of CDM Smith for the design build team with the
exception of the potential for a credit for the pre filtration if not necessary based on
water quality test, as well as to consider inclusion into the contract for Quality
Assurance to be conducted by Cal Am or its representative.

AYES: 6 DIRECTORS:
Burnett, Edelen, Kampe, Pendergrass, Rubio, Della Sala
NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None

5. Discuss and Provide direction to Water Authority Vice-President Burnett on the Design-Build
Selection Scheduled for discussion at the at the Governance Committee meeting on Dec 11,
2013 (Burnett)
Action: Item Tabled

On motion by Director Kampe and Seconded by Directors Edelen and Rubio and passed by the
following vote, the Authority approved tabling this item:

AYES: 6 DIRECTORS:
Burnett, Edelen, Kampe, Pendergrass, Rubio, Della Sala
NOES: 0 DIRECTORS: None
ABSENT: 0 DIRECTORS: None
ABSTAIN: 0 DIRECTORS: None
RECUSED: 0 DIRECTORS: None


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Monterey Peninsula Regional Water Authority
Special Meeting Minutes - Monday, December 9, 2013
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6. Receive Report, Discuss and Provide Direction on Alternates Funding Scenarios as Related to
Cost of Water (Cullem)

Executive Director Cullem spoke to the item and gave a brief presentation which recommended
that the Authority review the alternative funding scenarios (as outlined in the attachment
included in the packet) and provide direction as to how to determine the costs impact to the
average customer for water usage. The projected cost increase associated with the MPWSP
provided to the CPUC on December 2, 2013 indicating increases could range from $32 to $52
per month. Executive Director Cullem answered requested guidance from the Directors on how
best to calculate and communicate these issues to the public.

Director Burnett added that the TAC will take up the issues as well as will work with the
Monterey Peninsula Water Management District to determine and communicate how this will
impact the individual water rate payers and bring it back before the Directors. Executive Director
Cullem spoke to the different usage categories that will be addressed. Director Edelen clarified
that these calculations would be based on the 9.6 MGD facility not the smaller facility plus GWR
or ASR.

President Della Sala opened the item to public comment.

George Riley spoke as a member of the public that public awareness will happen when
the first bill is received with the water increase included. He expressed concerned about
financing $83 million dollars and that more money is being set aside for water reclaiming
projects over water supply projects and thinks that the projections of getting funding is
overly optimistic.

Director Kampe questioned how and if the financial liability of the projects (GWR/Desal/ASR)
will be calculated which must be considered in the overall solution.

Mr. Cullem spoke to the analysis that will be done regarding the costs of the GWR project,
similar to that of the desal project noting there will be capital costs, but also savings in operating
costs, therefore a net present value and total cost analysis will reveal the best results as capital
costs is only a small part of the total project cost analysis.

Direction was provided and no action was taken.

ADJOURNMENT

The Meeting was adjourned at 2:13 p.m.


ATTEST:





Lesley Milton, Clerk of the Authority Chuck Della Sala, MPRWA President

MPRWA Meeting, 1/9/2014 , tem No. 1., tem Page 4, Packet Page 4
MONTEREY PENINSULA REGIONAL
WATER AUTHORITY

CERTIFICATE OF APPRECIATION
FOR OUTSTANDING CONTRIBUTIONS

Whereas, The Board of Directors of the Monterey Peninsula Regional Water Authority
hereby wishes to express its heartfelt appreciation to Deanna Allen for her outstanding
contribution to the operation of the Water Authority as its Finance Specialist from February
2012 to January, 2014.
Whereas, Deanna worked tirelessly to process invoices, make and receive payments, and
to maintain all Authority finance records as an unpaid extra duty in her full time position at
the City of Carmel by the Sea. Despite her workload at the City, Deanna never failed to provide
timely and accurate information on expenditures and receipts and she managed to keep the
Authority in the black throughout 2013.
Whereas, Her professionalism competence was confirmed by the successful completion
of the Authority Audit for Fiscal Year 2012-2013 and 2012.
Therefore, The Board of Directors commends Deanna for her hard work and dedicated
service to the Water Authority and wishes her continued success in the future.


Chuck Della Sala, President Jason Burnett, Vice President Jerry Edelen, Treasurer


Ralph Rubio, Secretary David Pendergrass, Director Bill Kampe, Director
MPRWA Meeting, 1/9/2014 , tem No. 2., tem Page 1, Packet Page 5

Monterey Peninsula Regional Water Authority
Agenda Report

Date: January 09, 2014
Item No: 3.


08/12


FROM: Executive Director Cullem


SUBJECT: Authorize Contract Extension for Brownstein, Hyatt, Farber and Schreck for Legal
Services

RECOMMENDATION:
It is recommended that the Monterey Peninsula Regional Water Authority (MPRWA) adopt
Resolution 2014-01 approving Brownstein Hyatt Farber Schreck, LLP as Attorney of Record for
the period January 1, 2014 through December 31, 2014, authorizing the Authority President to
execute a contract with Brownstein, and approving a budget increase of $100,000 accordingly.

DISCUSSION:
In March 2012, The Authority negotiated an agreement for Attorney of Record services with
Brownstein. The firm provided special expertise in water law, at a reduced rate, in support of
Water Authority formation and activities.
Settlement agreements in May, June, and July 2013 during the California Public Utilities
Commission (CPUC) process for considering Cal-Ams Monterey Peninsula Water Supply
Project (MPWSP) involved considerable participation by Brownstein on behalf of the Authority.
To address requirements through the remainder of the calendar year, the Authority extended
the Brownstein contract to December 31, 2013 at its meeting of September 12, 2013.
The CPUC process, as well as negotiations with the State Water Resources Control Board on
the Cease and Desist Order, will continue to require a substantial amount of legal work in 2014.
To insure continuity in Attorney of Record services, the Executive Director recommends the
Authority extend the contract with Brownstein through 31 December 2014.
BUDGET CONSIDERATIONS:
On December 5, 2013, Brownstein provided the Authority with an estimate of legal expenses by
calendar quarter in 2014. For the balance of FY 2013-2014 (January-June 2014), the estimate
is between $77,000 and $121,000. The total estimate for all of CY 2014 ranges between
$124,000 and $194,000. Of course, actual expenses depend upon legal requirements which are
not yet fully determined.
As of December 31, 2013, approximately $21,000 remains in the FY 2013-2014 budget for
Attorney of Record Services. Accordingly, an additional $100,000 will be needed for CY 1 and 2.
Thus, the revised budget for Attorney of Record Services for FY 2013-2014 will total $121,000.
MPRWA Meeting, 1/9/2014 , tem No. 3., tem Page 1, Packet Page 7



Since the Water Authority is awaiting a contribution of $83,300 in approved funding from
Monterey County, it is not necessary to adjust the City contributions at this time.
Funding for CY quarters 3 and 4 will be addressed as part of the FY 2014-2015 budget process.
Resolution 2014-01 approves an extension of Brownstein as Attorney of Record through
December 31, 2014 and authorizes the Authority President to execute a contract with
Brownstein accordingly. It also approves an additional $100,000 in the FY 2013-2014 budget for
Attorney of Record services.

ATTACHMENTS:
Resolution 2014-01
Sample contract for legal services




MPRWA Meeting, 1/9/2014 , tem No. 3., tem Page 2, Packet Page 8


MPRWA RESOLUTION NO. 2014-__

A RESOLUTION OF THE MONTEREY PENINSULA REGIONAL WATER
AUTHORITY

ACKNOWLEDGING, BROWNSTEIN HYATT FARBER SCHRECK,LLP AS
ATTORNEY OF RECORD FOR THE MONTEREY PENINSULA REGIONAL WATER
AUTHORITY AND AUTHORIZING THE PRESIDENT TO EXECUTE A CONSENT
AND WAIVER OF CONFLICT OF INTEREST


WHEREAS, Brownstein Hyatt Farber Schreck,LLP(Brownstein) has been
requested to represent the Monterey Peninsula Regional Water Authority (MPRWA) as
Attorney of Record; and

WHEREAS, Brownstein is currently acting as special council for the City of
Carmel by the Sea; and

WHEREAS, Brownstein and MPRWA recognize the potential conflict of interest
which may arise as a result of Brownsteins legal representation of MPRWA and the
City of Carmel; and

WHEREAS, MPRWA wishes to acknowledge Brownstein as Attorney of Record
for MPRWA; and

WHEREAS, the President of MPRWA and members of the MPRWA Board of
Directors have reviewed a letter from Brownstein indicating that Brownstein does not
believe that its legal services for the Monterey Peninsula Regional Water Authority will
have any impact on its full and effective representation of each party, and does not
believe it has knowledge of any confidential information from any party which would be
material or relevant to its representation of MPRWA, the City of Carmel by the Sea; and

WHEREAS, Brownstein recognizes that by concurrently representing the
MPRWA, the City of Carmel by the Sea an issue of divided loyalty, such as in litigation,
could possibly arise at some future date, and that at that time it could be necessary for it
to make full disclosure to all parties, could be subject to disqualification from
representing any party, and at such time it would be necessary for each party to seek
independent legal counsel; and

WHEREAS, the City of Carmel by the Sea has passed their respective
Resolutions and their respective Mayors have executed the Consent and Waiver of
Conflict of Interest; and

WHEREAS, the President and Board of Directors have reviewed this request
MPRWA Meeting, 1/9/2014 , tem No. 3., tem Page 3, Packet Page 9


with independent legal counsel;

WHEREAS, according to Rule 3-310 of the California Rules of Professional
Conduct applicable to California lawyers which requires informed written consent of all
represented parties because of concurrent representation, MPRWA recognizes that
Brownstein is the special legal counsel for the City of Carmel by the Sea; and

WHEREAS Board of Directors wishes to authorize the President to execute a
Consent and Waiver of Conflict of Interest, and hereby acknowledges Brownstein as
Attorney of Record for the Monterey Peninsula Regional Water Authority.

NOW, THEREFORE, BE IT RESOLVED, that the President of MPRWA is hereby
authorized to execute on behalf of MPRWA a Consent and Waiver of Conflict of Interest
thereby acknowledging Brownstein as Attorney of Record for the Monterey Peninsula
Regional Water Authority.

NOW, THEREFORE, BE IT FURTHER RESOLVED, that the President of
MPRWA is hereby authorized to execute on behalf of MPRWA a contract with
Brownstein for services as Attorney of Record for the Monterey Peninsula Regional
Water Authority.

PASSED AND ADOPTED BY THE MONTEREY PENINSULA REGIONAL
WATER AUTHORITY this ____day of ____ 2014, by the following vote:


AYES: 0 DIRECTORS:
NOES: 0 DIRECTORS:
ABSENT: 0 DIRECTORS:
ABSTAIN: 0 DIRECTORS:

APPROVED:


ATTEST:




Chuck Della Sala, President



Lesley Milton, Clerk

MPRWA Meeting, 1/9/2014 , tem No. 3., tem Page 4, Packet Page 10


DRAFT-January 9, 2014

EMPLOYMENT AGREEMENT FOR LEGAL SERVICES


THIS AGREEMENT, made and entered into this ___ day of _____________, 2014, by and
between the MONTEREY PENINSULA REGIONAL WATER AUTHORITY, hereinafter
MPRWA, and the LAW OFFICES of BROWNSTEIN HYATT FARBER SCHRECK, LLP,
hereinafter referred to as "Attorney", both of which understand as follows:

A. Term: The term of this Agreement shall be for one (1) year commencing January 1,
2014, and shall terminate on December 31, 2014, unless terminated pursuant to paragraph H. of this
Agreement.

B. Compensation. Attorney will provide legal services to MPRWA at an average rate of
no more than $350.00 per hour.

C. Billing and Reimbursement of Costs. An accounting of services and hours will be
provided to MPRWA on a monthly basis. Attorney shall be reimbursed for actual out-of-pocket
expenses and costs advanced or paid on behalf of the MPRWA, including court reporter fees and
charges, court costs, and costs of outside investigators or experts pertaining to MPRWA litigation.
Travel to conduct MPRWA related business expenses shall be billed as actual out-of-pocket costs
unless otherwise negotiated. There will be no charge for actual travel time.

D. Budget. Attorney will not accrue costs for legal services in excess of $49,000
between January 1, 2014 and March 31, 2014 and in excess of $72,000 between April 1, 2014 and
June 30, 2014 without prior approval of the Authority Executive Director. Services after June 30,
2014 are subject to adoption of an Authority budget for FY 2014-2015.

E. Ordinary Services. Legal advice and legal opinions to MPRWA as outlined in the
Amendment to Agreement for Legal Services dated December 5, 2013 (Exhibit A to this Agreement)
and Brownstein Hyatt Farber Schreck, LLP Standard Terms and Conditions (Exhibit B to this
Agreement).

F. Extraordinary Legal Services. Preparation of complex legal documents, representing
MPRWA in court appearances, litigation, or in proceedings before other public or administrative
bodies, or legal services provided to any independent or separate agency or entity of government not
operated as an integral part of MPRWA.

G. Miscellaneous. MPRWA recognizes that Attorney is a private law practice currently
located in Santa Barbara, California, and will retain that office as its principal place of business. In
addition, MPRWA recognizes Attorney also represents and advises other public entities upon
request. Attorney will submit conflict waivers to MPRWA whenever such potential arise during the
MPRWA Meeting, 1/9/2014 , tem No. 3., tem Page 5, Packet Page 11



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term of this contract.

H. Association of Special Legal Counsel. MPRWA and Attorney recognize, that from
time to time, it may become necessary to associate with special legal counsel for matters involving
litigation, labor negotiations, worker's compensation personnel or bond issue proceedings and other
matters where either MPRWA Board of Directors or Attorney feel effective representation requires
special legal counsel.

I. Termination. Either party may terminate this Agreement without cause by providing
written notice to the other party in the manner set forth in item I. of this Agreement at least 30 days
prior to the effective date of termination.

J. Notices. All notices herein provided to be given, or which may be given by either
party to the other, shall be considered fully received when made in writing and deposited in the
United States mail, certified and postage prepaid, and addressed to the respective parties as follows:

MPRWA: ATTORNEY:

President, Board of Directors Russell M. McGlothlin
Monterey Peninsula Regional BROWNSTEIN HYATT FARBER SCHRECK, LLP
Water Authority 21 East Carrillo Street
580 Pacific Street Santa Barbara, CA 93101
Monterey, CA 93940

K. Immunity. As an authorized representative of MPRWA, Attorney shall be recognized
as having rights to any immunity MPRWA is entitled to. In no event shall any duties contained in
this Agreement, or otherwise herein, negate any legal protections or immunities available to the
parties under local, state or federal law.

IN WITNESS WHEREOF, MPRWA has caused this agreement to be signed and executed on
its behalf by its President, and duly attested by its Clerk; and the Attorney has signed and executed
this agreement in duplicate originals the day and year first hereinabove written.

MPRWA

____________________________
Chuck Della Sala, President

ATTORNEY:
ATTEST:

_____________________ _________________________
Russell M. McGlothlin Clerk of the Board
MPRWA Meeting, 1/9/2014 , tem No. 3., tem Page 6, Packet Page 12

015621\0002\10889833.1
Memorandum
DATE: December 5, 2013
TO: Monterey Peninsula Regional Water Authority
FROM: Russell M. McGlothlin
RE: Estimated 2014 Budget for Legal Services from Brownstein Hyatt Farber Schreck

You have requested that we estimate the budget for legal services from our firm for calendar year 2014.
The attached table estimates the 2014 budget for our anticipated representation of the Monterey
Peninsula Regional Water Authority (Authority) with respect to: (1) the pending application by California
American Water for issuance of a Certificate of Public Convenience and Necessity from the California
Public Utilities Commission for the proposed Monterey Peninsula Water Project (Application 12.04.012);
and (2) discussions and negotiations with the State Water Resources Control Board concerning
operation of the Cease and Desist Order (SWRCB Order 2009-0060).
The table estimates the budget for the principal categories of work that we anticipate in 2014 and is
segregated by quarter. Additional work, either for these proceedings, but beyond the matters listed, or
work unrelated to these proceedings, may necessitate expenditures beyond those estimated below.
The variance between the low and high estimates reflects the inherent uncertainty concerning the
scope of necessary work. Where possible and appropriate we will seek to coordinate with other entities
(e.g., MPWMD) to ensure efficient and cost-effective representation.
MPRWA Meeting, 1/9/2014 , tem No. 3., tem Page 7, Packet Page 13

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015621\0002\10889833.1

Estimated Budget for CPUC A.12.04.019 and SWRCB CDO (2014)

Task/Matter

Quarter Low High

Briefing on Settlement Agreement, Including Jurisdictional
Issues Pertaining to Governance Committee
1 $6,000 $9,000
Prepare and Submit Comments on Draft EIR 1 $8,000 $12,000
Securitization Legislation 1 $3,000 $5,000
Prepare for and Attend Quarterly Check-in Call with Settling
Parties
1 $500 $2,000
Efforts re Modification of CDO 1 $6,000 $9,000
General Case/Matter Management Issues 1 $8,000 $12,000
Subtotal Q1

$31,500 $49,000

Opening and Reply Briefing 2 $10,000 $15,000
Review and Correspondence re Final EIR 2 $3,000 $5,000
Comments on Proposed Decision

$10,000 $15,000
Securitization Legislation 2 $3,000 $5,000
Ex Parte Meeting(s) (Not Certain) 2 $6,000 $9,000
Prepare for and Attend Quarterly Check-in Call with Settling
Parties
2 $500 $2,000
Efforts re Modification of CDO 2 $6,000 $9,000
General Case/Matter Management Issues 2 $8,000 $12,000
Subtotal Q2

$46,500 $72,000



Ex Parte Meeting(s) (Not Certain) 3 $3,000 $6,000
Review and Correspondence re CPCN Phase I 3 $4,000 $6,000
Prepare for and Attend Quarterly Check-in Call with Settling
Parties
3 $500 $2,000
Efforts re Modification of CDO 3 $6,000 $9,000
General Case/Matter Management Issues 3 $8,000 $12,000
Subtotal Q3

$21,500 $35,000

GWR Phase - Testimony 4 $10,000 $15,000
Prepare for and Attend Quarterly Check-in Call with Settling
Parties
4 $500 $2,000
Efforts re Modification of CDO 4 $6,000 $9,000
General Case/Matter Management Issues 4 $8,000 $12,000
Subtotal Q4 $24,500 $38,000

Total 2014 $124,000 $194,000


MPRWA Meeting, 1/9/2014 , tem No. 3., tem Page 8, Packet Page 14

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015621\0002\10889833.1

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Monterey Peninsula Regional Water Authority
Agenda Report

Date: January 09, 2014
Item No: 4.



06/12
FROM: Executive Director Cullem

SUBJECT: Receive Update on Pro-Rated Cost Share Requests from the County of
Monterey

RECOMMENDATION:
It is recommended that the MPRWA receive an update on requests to Monterey County
for pro-rated cost shares for the final Water Authority budget for FY 2012-2013 and for
adopted budget for FY 2013-2014.

DISCUSSION:
At its special and regular meetings of November 14, the Water Authority authorized a
request to the Monterey Board of Supervisors for a pro-rated (fair share) contribution for
the costs of SPIs participation in the Cal-Am design-build contractor selection process
as well as for on-going Water Authority expenses. Approximately 34% of Cal-Am
customers reside outside the incorporated areas but have been represented by the
Authority without a fair-share contribution of the County.
Attached are copies of two Water Authority letters requesting County approval of fair
share contributions.
FISCAL IMPACT:
The letter of December 2, 2013 would provide approximately $12,000 in reimbursement
to the Water authority. The letter of January 6, 2014, however, requests new funding for
the Authority totaling $306,000 of which $83,300 had already been approved by (but not
yet invoiced to) the Board of Supervisors on September 11, 2012.

ATTACHMENTS:
Water Authority letters of December 2, 2013 and January 6, 2014.
MPRWA Meeting, 1/9/2014 , tem No. 4., tem Page 1, Packet Page 17


580 PACIFIC ST, ROOM 6 MONTEREY CALIFORNIA 93940 www.mprwa.org
MONTEREY PENINSULA REGIONAL WATER AUTHORITY


December 2, 2013

Fernando Armenta, Chair
Monterey County Board of Supervisors
168 W. Alisal St.
Salinas, CA 93901



Directors:
Chuck Della Sala, President
J ason Burnett, Vice President
Ralph Rubio, Secretary
J erry Edelen, Treasurer
Bill Kampe, Director
David Pendergrass, Director

Executive Director:
J im Cullem, P.E.

RE: Fair Share Reimbursement for Engineering Support Services for DB Selection

Dear Mr. Armenta,

As you know, Supervisor Dave Potter represents the County on the Monterey Peninsula Water Supply
Project (MPWSP) Governance Committee. The Monterey Peninsula Regional Water Authority (MPRWA)
is represented by Carmel Mayor J ason Burnett, and the Monterey Peninsula Water Management District
(MPWMD) is represented by Director J eanne Byrne.

At the end of October, consistent with the current Governance Agreement, the Committee received an
invitation from the California American Water Company (Cal-Am) to provide a representative of the
committee to participate in Cal-Ams interview and selection process for a Design-Build (DB) firm for the
desalination (Desal) plant component of the MPWSP.

Members of the Governance Committee concluded that the representative should be a technically
qualified professional with specific experience with Desal and the design-build process, as well as
knowledge of the MPWSP. The interviews were to take place 5-6 November 2013, so time was of the
essence. Given the short notice and the qualification requirements, it was agreed to execute a non-
competitive contract with Separation Processes, Inc. (SPI), the firm that conducted the comparative Desal
study in 2012.

Alex Wesner, P.E. is the SPI representative and will brief Governance Committee members as the
process moves forward. He will bill for his time at a rate of $201 per hour. Labor costs are estimated at
$30,000, direct overhead costs (including travel) estimated at $4000, and a project contingency would be
$2000. Total costs would not exceed $36,000. Since the Governance Committee must rely on its member
agencies for execution and funding of contracts, agencies have been asked to share the cost equally
($12,000 each).

The only one of the three public agencies that could meet quickly enough to award a contract prior to the
start of the interviews was the MPRWA, which held a special meeting on October 31 to approve the
contract with SPI for Phase 1 of the work at a price not-to-exceed $12,000 (the Water Authority share).
Inclusion of Phases 2 and 3 were to be contingent on commitments from the MPWMD and the County.
The contract with SPI dated November 5, 2013 and scope of work are attached.



MPRWA Meeting, 1/9/2014 , tem No. 4., tem Page 2, Packet Page 18
November 12, 2013
2


As of November 12, SPI had completed most of the Phase 1 work and needed a contract change order to
proceed with Phases 2 and 3 which were fast approaching. Since representatives of MPWMD and the
County had indicated their agencies would pay their fair share as quickly as could be internally approved,
the Water Authority issued a change order to the SPI contract at its meeting of November 14 to complete
Phases 2 and 3, increase the contract total price to not-to-exceed $36,000, and extend the completion
date to March 31, 2014.

It is requested that the Monterey County Board of Supervisors approve reimbursement of the Water
Authority one third (1/3) the final amount of the SPI contract, not-to-exceed $12,000 in cost to the County.


Sincerely,


Chuck Della Sala, President
Monterey Peninsula Regional Water Authority



C: Charles McKee, County Counsel


Attachment:
Water Authority contract with SPI for Consultant Support Services dated Nov 5, 2013 including Scope of
Work


MPRWA Meeting, 1/9/2014 , tem No. 4., tem Page 3, Packet Page 19


580 PACIFIC ST, ROOM 6 MONTEREY CALIFORNIA 93940 www.mprwa.org
MONTEREY PENINSULA REGIONAL WATER AUTHORITY



J anuary 6, 2014

Fernando Armenta, Chair
Monterey County Board of Supervisors
168 W. Alisal St.
Salinas, CA 93901



Directors:
Chuck Della Sala, President
J ason Burnett, Vice President
Ralph Rubio, Secretary
J erry Edelen, Treasurer
Bill Kampe, Director
David Pendergrass, Director

Executive Director:
J im Cullem, P.E.

RE: Pro-Rata Share of Costs for Water Authority Representation and Invitation to Participate


Dear Supervisor Armenta:

As you know, the Monterey Peninsula Regional Water Authority (MPRWA) was created by a
J oint Exercise of Powers Agreement on February 12, 2012 and originally consisted of the six cities on
the Monterey Peninsula: Carmel-by-the-Sea, Del Rey Oaks, Monterey, Pacific Grove, Sand City and
Seaside. Since 34% of California American Water Company (Cal-Am) customers reside within non-
incorporated areas, a restatement of the Agreement was adopted by the Water Authority on February
14, 2013 to allow membership by Monterey County.

Although Supervisor Dave Potter represents the County on the Monterey Peninsula Water
Supply Project (MPWSP) Governance Committee, the Water Authority also separately considers
issues impacting residents of the unincorporated areas. Accordingly, we would again like to invite the
Board of Supervisors to name a representative to the MPRWA Board.

In recognition of Water Authority efforts on behalf of County residents, the Board of
Supervisors approved a pro-rata contribution of $83,300 on 11 September 2012, based on an initial
FY 2012-2013 MPRWA budget of $245,245. To date, the Authority has not yet invoiced the County for
those funds.

The FY 2012-2013 MPRWA budget was subsequently increased to $476,726 to cover the
costs of a part-time Executive Director and a contract for expanded Attorney of Record expenses in
support of Authority participation in the California Public Utilities Commission (CPUC) settlement
negotiations on Cal-Ams application A.12-04-019 for a Monterey Peninsula Water Supply Project
(MPWSP).

The Countys revised FY 2012-2013 pro-rata share at 34% would be $162,000 or an increase
of $78,700 over the previously approved contribution.

The FY 2013-2014 MPRWA budget of $423, 680 was adopted on April 25, 2013. The
Countys pro-rata share at 34% is $144,000.



MPRWA Meeting, 1/9/2014 , tem No. 4., tem Page 4, Packet Page 20
J anuary 6, 2014
2


Accordingly, the Water Authority hereby requests that the Board of Supervisors approve a
revision to its fair-share (pro-rata) contribution to the MPRWA budget for FY 2012-2013 in the amount
of an additional $78,700 and approve its pro-rata contribution to the MPRWA budget for FY 2013-
2014 in the amount of $144,000.


Sincerely,


Chuck Della Sala, President
Monterey Peninsula Regional Water Authority



C: Lew Bauman, County Administrative Officer
Charles McKee, County Counsel


MPRWA Meeting, 1/9/2014 , tem No. 4., tem Page 5, Packet Page 21

Monterey Peninsula Regional Water Authority
Agenda Report

Date: January 09, 2014
Item No: 5.



06/12
FROM: Executive Director Cullem, Prepared by Clerk Milton

SUBJECT: Approve and File Checks Through December 31, 2013

RECOMMENDATION:
It is recommended that the MPRWA approve and file the accounts payable payments
made during the period of July 1, 2013 through December 31, 2013. Total Accounts
Payable and Payroll for the above referenced period is $222,300.21. It is recommended
that the Authority approve and file the attached checks.
DISCUSSION:
At its meeting on September 12, 2013, the Authority Board approved a staff
recommendation to provide the Directors a listing of general checks issued since the last
report so that it can inspect and confirm these checks. Each invoiced expense has been
reviewed and approved by the Executive Director and Finance personnel and confirmed
by the President or Vice President prior to payment to insure that it conforms to the
approved budget.
The following checks are hereby submitted to the Authority for inspection and
confirmation.
$13,500 to Perry and Freeman For Legal Services
$800 for Opinion Editorial Editing
$300 to Sunset Center for CPUC meeting space
$1,312.5 to AMP for Video Recording and Broadcasting
157,090.19 for Special Legal Counsel of Brownstein, Hyatt, Farber and Schreck
$828.74 to The City of Monterey for Administrative Expenses Reimbursement
(Meeting space for CPUC meeting at Marriott, Website Renewal, etc)
$6,766.90 to Separation Processes for Project Evaluation/Consulting testimony
$6,701.88 for Insurance Expenses
$35,000 for Clerical and Administrative Services Contract (annual payment)

FISCAL IMPACT
The listed checks have been budgeted and paid from the various funds, as appropriate.
ATTACHMENT
Compiled list of general checks issued for the period described above.
MPRWA Meeting, 1/9/2014 , tem No. 5., tem Page 1, Packet Page 23
Type Date Name Item Account Paid Amount Original Amount

Bill Pmt -Check 8/8/2013 Don Freeman Wells Fargo Checking -4,500.00

Bill 7/1/2013 5110 Independent Legal Counsel Serv -2,250.00 2,250.00
Bill 8/1/2013 5110 Independent Legal Counsel Serv -2,250.00 2,250.00
TOTAL -4,500.00 4,500.00
Bill Pmt -Check 8/8/2013 Lewis A. Leader Wells Fargo Checking -800
Bill 8/1/2013 5500 OUTSIDE SERVICES -800 800
TOTAL -800 800
Bill Pmt -Check 8/8/2013 Sunset Cultural Center, Inc. Wells Fargo Checking -300
Bill 6/30/2013 5500 OUTSIDE SERVICES -300 300
TOTAL -300 300
Bill Pmt -Check 8/2/2013 Access Monterey Peninsula Wells Fargo Checking -900
Bill 8/2/2013 5500 OUTSIDE SERVICES -900 900
TOTAL -900 900
Bill Pmt -Check 9/10/2013 Brownstein Hyatt Farber Schreck Wells Fargo Checking -110,120.81
Bill 4/16/2013 5210 Attorney of Record(CPUC) -18,385.39 18,385.39
Bill 5/17/2013 5210 Attorney of Record(CPUC) -44,870.95 44,870.95
Bill 6/27/2013 5210 Attorney of Record(CPUC) -22,297.79 22,297.79
Bill 6/30/2013 5210 Attorney of Record(CPUC) -21,372.75 21,372.75
5860 Travel Expense -12.25 12.25
5210 Attorney of Record(CPUC) -3,181.68 3,181.68
TOTAL -110,120.81 110,120.81
Bill Pmt -Check 10/24/2013 Brownstein Hyatt Farber Schreck Wells Fargo Checking -23,842.99
Bill 9/4/2013 5210 Attorney of Record(CPUC) -19,600.00 19,600.00
Bill 9/10/2013 5210 Attorney of Record(CPUC) -4,242.99 4,242.99
TOTAL -23,842.99 23,842.99
Bill Pmt -Check 10/24/2013 City of Monterey Rev Division Wells Fargo Checking -828.74
Bill 8/27/2013 5300 STAFF SERVICES Admin/Clerical -828.74 828.74
TOTAL -828.74 828.74
Bill Pmt -Check 10/24/2013 Don Freeman Wells Fargo Checking -6,750.00
Bill 9/1/2013 5110 Independent Legal Counsel Serv -2,250.00 2,250.00
Bill 10/1/2013 5110 Independent Legal Counsel Serv -2,250.00 2,250.00
Bill 11/1/2013 5110 Independent Legal Counsel Serv -2,250.00 2,250.00
TOTAL -6,750.00 6,750.00
Bill Pmt -Check 10/24/2013 Separation Processes, Inc. Wells Fargo Checking -6,766.90
Bill 4/3/2013 5510 Project Evaluation Study -871.8 871.8
Bill 5/6/2013 5510 Project Evaluation Study -2,679.10 2,679.10
Bill 6/5/2013 5510 Project Evaluation Study -3,216.00 3,216.00
TOTAL -6,766.90 6,766.90
Bill Pmt -Check 12/3/2013 Access Monterey Peninsula Wells Fargo Checking -225
Bill 10/25/2013 5500 OUTSIDE SERVICES -225 225
TOTAL -225 225
Bill Pmt -Check 12/3/2013 Alliant Insurance Services Wells Fargo Checking -6,701.88
Bill 9/12/2013 5600 INSURANCE EXP -6,701.88 6,701.88
TOTAL -6,701.88 6,701.88
Bill Pmt -Check 12/3/2013 Brownstein Hyatt Farber Schreck Wells Fargo Checking -23,126.39
Bill 10/17/2013 5210 Attorney of Record(CPUC) -11,179.00 11,179.00
Monterey Peninsula Regional Water Authority
Check Detail
All Transactions J uly 1, 2013 to December 31, 2013
MPRWA Meeting, 1/9/2014 , tem No. 5., tem Page 2, Packet Page 24
Bill 10/31/2013 5210 Attorney of Record(CPUC) -3,710.00 3,710.00
Bill 10/31/2013 5210 Attorney of Record(CPUC) -105 105
Bill 11/21/2013 5210 Attorney of Record(CPUC) -8,132.39 8,132.39
TOTAL -23,126.39 23,126.39
Bill Pmt -Check 12/3/2013 City of Monterey Rev Division Wells Fargo Checking -35,000.00
Bill 11/26/2013 5300 STAFF SERVICES Admin/Clerical -35,000.00 35,000.00
TOTAL -35,000.00 35,000.00
Bill Pmt -Check 12/3/2013 Don Freeman Wells Fargo Checking -2,250.00
Bill 12/3/2013 5110 Independent Legal Counsel Serv -2,250.00 2,250.00
TOTAL -2,250.00 2,250.00
Bill Pmt -Check 12/3/2013 Access Monterey Peninsula Wells Fargo Checking -187.5
Bill 11/22/2013 5500 OUTSIDE SERVICES -187.5 187.5
TOTAL -187.5 187.5
Total Checks Paid -222,300.21
MPRWA Meeting, 1/9/2014 , tem No. 5., tem Page 3, Packet Page 25

Monterey Peninsula Regional Water Authority
Agenda Report

Date: January 09, 2014
Item No: 6.



06/12
FROM: Executive Director Cullem

SUBJECT: Receive Update on Status of Financial Report and Full Opinion Audit for FY
2012-2013 and 2012,

RECOMMENDATION:
It is recommended that the MPRWA receive an update on the Full Opinion Audit for Fiscal Year
2012-2013 and for 2012 (partial FY 2011-2012)
DISCUSSION:
At its meeting on June 13, 2013, the Water Authority Board approved a staff recommendation to
allow completion of the Financial Annual Report and a Full Opinion Audit for FY 2012-13, as
required by Water Authority Bylaws sections 6.3 and 6.4.1, concurrently with that of the Member
City conducting the Authority audit. However, staff subsequently determined it would create less
of a potential conflict of interest to select a firm not currently auditing member cities.
Following an informal proposal process, the Executive Director selected McGilloway, Ray,
Brown and Kaufman (Kaufman) for the audit and a contract was executed on October 31, 2013.
A time extension for report completion to Dec 31, 2013 and, an extension of the contract
completion date to March 31, 2014 were approved by the Water Authority on November 14,
2013 in order to provide additional time for any unanticipated audit follow-up after the report was
completed.
The draft audit was completed on 27 December and reviewed by the Authority Treasurer on 29
December. Since no errors were found or corrections made, the audit is considered complete.
However, Kaufman has requested an opportunity to brief the Treasurer and the Executive
Director on a Management Letter which should accompany the audit. Since that briefing has
not yet taken place, the Executive Director will submit the final audit report to the Authority at the
next meeting.




MPRWA Meeting, 1/9/2014 , tem No. 6., tem Page 1, Packet Page 27

Monterey Peninsula Regional Water Authority
Agenda Report

Date: January 09, 2014
Item No: 7.



06/12
FROM: Executive Director Cullem

SUBJECT: Year End Budget Review for Calendar Year 2013

RECOMMENDATION:
It is recommended that the MPRWA receive an update the budget for FY 2013-2014 as
of the end of the calendar year (December 31, 2013).
DISCUSSION:
At its meeting of April 25, 2013, the Water Authority adopted a budget of $423,680 for
Fiscal Year 2013-2014. As of December 31, 2013, the Authority has expended
approximately $222,000 (52%) of the budget funds.
The contribution from each City was calculated based upon a lesser amount of
$341,263 in anticipation of a FY 2012-2013 $82,417 surplus. Unfortunately, that surplus
failed to materialize as a consequence of higher than expected Attorney of Record costs
associated with the CPUC settlement proceedings in the spring of 2013.
In addition, Attorney of Record billings continue as a major expense, but are within the
budget as of December 31, 2013. However, as noted in the staff report for the
Brownstein Contract extension, an increase for the Attorney of record in the order of
$86,000 will be needed for calendar year 2014. Distribution of Attorney of Record
expenses between FY 2013-2014 and FY 2014-2015 is yet to be finalized.
As a result of the reduced City assessments discussed above there will be a shortfall in
funding for the current fiscal year. However, the Authority has requested a fair-share
contribution from Monterey County in the amount of $306,000. Of that amount, $83,300
has already been approved by the Board of Supervisors. If the County provides its fair
share in the near term, the shortfall would be eliminated.
FISCAL IMPACT:
Accordingly, the Executive Director recommends the Authority defer a revision to the
City assessments until the Authority has received a response from the County to the
fair-share funding requests.

MPRWA Meeting, 1/9/2014 , tem No. 7., tem Page 1, Packet Page 29

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