14. Conclusion

We find the Settlement Agreement and Implementing Agreements are reasonable in light of the entire record, in compliance with the law, and in the public interest. We agree with the Settling Parties: time is of the essence to ensure that the Regional Project can be permitted, financed, and constructed, and authorize Cal-Am's participation in the Regional Project and issue a CPCN for the Cal-Am facilities.

As the Settling Parties have already agreed, we require Cal-Am to submit regular status reports on the permitting, financing, design, bidding, and construction of the Regional Project to the Executive Director and to the Director of DWA. We also require Cal-Am to meet quarterly with DRA and DWA staff. No modification is required to effectuate this requirement.

The Settlement Agreement and the Water Purchase Agreement we approve today have far-reaching consequences. While we cannot bind future Commissions, as DRA points out, we are guided by the Commission's findings in D.06-09-040:

We realize that Commission precedent establishes that we cannot bind the actions of future Commissions and we will not comment on the consequences of a future Commission's changing of the terms of the settlement. However, we believe the settlement is a fair, just, and reasonable compromise of many difficult and potentially costly problems facing Fruitridge Vista and its customers. We believe it is in the best interest of Fruitridge Vista and its customers that the settlement agreement be implemented as adopted by our decision. Therefore, we state our intent that all future Commissions recognize and give full consideration and weight to the fact that this settlement has been approved based on the expectations and reasonable reliance of the parties and this Commission that all of its terms and conditions will be implemented by future Commissions.¹⁸⁰

We find that this guidance is valuable and include it in this decision as a Conclusion of Law.

A subsequent phase of this proceeding will address the cost allocation and rate design associated with the Coastal Water Project. The assigned Commissioner and ALJ will set a prehearing conference to determine the schedule for these issues. As the Settling Parties have noted, it will be important to consider the impact of this costly project on the low-income residents of Monterey County and we look forward to creative approaches to mitigating the associated rate impacts.

¹⁸⁰ D.06-09-040 at 26-27.