IX. Assignment of Proceeding
Susan P. Kennedy is the Assigned Commissioner and Michelle Cooke is the assigned ALJ in this proceeding.
1. The State Water Resources Control Board has ordered Cal-Am to find an alternative source for 10,730 acre feet of water currently taken from the Carmel River.
2. The 10,730 acre feet of water represents about 69% of Cal-Am's water supply for its Monterey Division.
3. In this application, filed in 1997, Cal-Am sought approval to construct a dam and storage reservoir to provide an alternative source of water.
4. The District served as lead agency under the California Environmental Quality Act for purposes of reviewing the dam.
5. The dam, known as the Carmel River Dam, was opposed by voters in the community that would be affected by the construction.
6. In 1998, Assembly Bill 1182 required this Commission to identify a long-term water supply contingency plan to replace the 10,730-acre feet of water from the Carmel River.
7. The contingency plan was issued in August 2002 and proposed a desalination facility called the Coastal Water Project.
8. In February 2003, Cal-Am filed two motions and a proposed amendment to this 1997 application.
9. The proposed amendment would modify the application to request a CPCN to construct the Coastal Water Project.
10. Cal-Am recommends that the Commission be designated as lead agency under CEQA to certify the environmental assessment required for the proposed Coastal Water Project.
11. The County, MCWRA and MCWD urge that Monterey County be lead agency in cooperation with MCWRA.
12. The District and CAWS support the District as lead agency.
13. The District was the lead agency for Cal-Am's application to construct the Carmel River Dam, and the District has extensive experience regarding Monterey Bay water supply options.
14. Many of the proposed Coastal Water Project facilities fall outside the District's jurisdictional boundaries and authority.
15. The County represents the community most affected by the Coastal Water Project proposal, and has permitting authority over the proposed desalination plant location.
16. The County in combination with MCWRA has jurisdictional responsibilities covering land use, management of water resources, and facility construction and operation.
17. The Commission is a statewide public agency with broad jurisdiction over a multi-jurisdictional project like the Coastal Water Project.
18. Effective environmental review will require extensive involvement by virtually all the responsible agencies with permit authority over the Coastal Water Project.
19. Cal-Am's ratemaking request covers (1) costs incurred or yet to be incurred for the Carmel River Dam project; (2) costs incurred in development of Plan B/Coastal Water Project, and (3) costs expected to be incurred with the Coastal Water Project.
20. The Carmel River Dam project has incurred costs of $3,279,161 to date.
21. D.03-02-030 classified Carmel River Dam project costs as CWIP and included such costs in ratebase.
22. Resolutions W-4131 and W-4237 authorized expenditure of $1.75 million for development of the Plan B/Coastal Water Project.
23. As of May 9, 2003, Plan B/Coastal Water Project development costs booked by Cal-Am totaled $1,761,751.57.
24. ORA opposes CWIP treatment for Coastal Water Project costs and recommends that such costs be booked to a memorandum account and accrue interest.
25. The record developed on the Carmel River Dam project is essentially moot for purposes of evaluating Cal-Am's new request for a CPCN for the Coastal Water Project.
1. Under CEQA, where a project is to be carried out by nongovernmental entities, the lead agency will normally be the public agency with the greatest responsibility for supervising or approving the project as a whole.
2. The Commission should assume lead agency status for the Coastal Water Project proposal, acting in close coordination with the other responsible agencies.
3. The Commission should not modify the ratemaking treatment adopted in D.03-02-030 for the Carmel River Dam costs.
4. In its next general rate case, Cal-Am should adjust its revenue requirement request to remove from CWIP any amounts adopted in D.03-02-030 that were not spent on the Carmel River Dam project.
5. Cal-Am's costs beyond the Commission's Plan B/Coastal Water Project development costs should not be booked to the ratemaking accounts authorized by the Commission's resolutions.
6. Interest on Plan B/Coastal Water Project development costs should continue to accrue until the costs are fully recovered by a surcharge.
7. Cal-Am should establish a memorandum account, with interest, to track ongoing costs of the Coastal Water Project.
8. Cal-Am should establish a memorandum account, with interest, to track public information costs for the Coastal Water Project.
9. A.97-03-052 should be dismissed without prejudice, and Cal-Am should be directed to file a new application for Commission authorization to pursue the Coastal Water Project and a Proponent's Environmental Assessment.
IT IS ORDERED that:
1. The Commission is designated the lead agency under the California Environmental Quality Act to conduct, prepare and certify the environmental assessment required for the Coastal Water Project proposal of California-American Water Company (Cal-Am).
2. The ratemaking treatment adopted in Decision (D.) 03-02-030 shall apply to costs incurred or yet to be incurred by Cal-Am in the development of its Carmel River Dam project in this application.
3. In its next general rate case, Cal-Am shall adjust its revenue requirement to remove from Construction Work in Progress (CWIP) any amounts adopted in D.03-02-030 that were not spent on the Carmel River Dam project.
4. Cal-Am is authorized to book only those Plan B/Coastal Water Project development costs authorized by Resolutions W-4131, W-4205 and W-4237.
5. Cal-Am is authorized to accrue interest at the 90-day commercial paper rate on Plan B/Coastal Water Project development costs until such costs are fully recovered by surcharge.
6. Cal-Am is authorized to establish a memorandum account, with interest at the 90-day commercial paper rate, to track ongoing costs of the Coastal Water Project.
7. Cal-Am is authorized to establish a memorandum account, with interest at the 90-day commercial paper rate, to track public information costs for the Coastal Water Project and to file a Proponent's Environmental Assessment.
8. Cal-Am is directed to file a new application for Commission authorization to pursue the Coastal Water Project.
9. Application 97-03-052 is dismissed without prejudice to the filing of a new application by Cal-Am.
This order is effective today.
Dated September 4, 2003, at San Francisco, California.
MICHAEL R. PEEVEY
President
CARL W. WOOD
LORETTA M. LYNCH
GEOFFREY F. BROWN
SUSAN P. KENNEDY
Commissioners
************ APPEARANCES ************ |
John W. Fischer |
Lenard G. Weiss |
Michelle Cooke |
Paul Townsley (END OF APPENDIX A) |
Edwin B. Lee |
