WASTEWATER RECLAMATION PROJECT
MANAGEMENT COMMITTEE
MINUTES

Meeting of March 17, 2006
Pebble Beach Community Services District Boardroom
Forest Lake & Lopez Roads, Pebble Beach, CA

1. Call to Order

Ray von Dohren, CAWD General Manager, serving as facilitator, called the meeting to order at 9:36 a.m. All members or alternates were present, including: Joyce Stevens and Charlotte F. Townsend, Carmel Area Wastewater District Board of Directors (CAWD); Richard D. Verbanec and Gary D. Hornbuckle, Pebble Beach Community Services District Board of Directors (PBCSD); and Mark Verbonich, Vice President, Pebble Beach Company (PBCo).

David Berger, General Manager, Monterey Peninsula Water Management District (MPWMD)
Robert Rathie, Legal Counsel, CAWD/PBCSD
Michael Niccum, P.E., District Engineer, PBCSD
Barbara Buikema, Accountant/Controller, CAWD
Vinod Badani, E2 Consulting Engineers
Charles Kemp, Operations Manager
Tom Peterson, Production Superintendent, Monterey District, California- American Water Company ("Cal-Am")
Michael Magretto, Operations Supervisor, Cal-Am
Fay A. Webb, Secretary to the Board, CAWD

Following introductions, there were no comments from visitors or Committee members regarding matters not listed on the agenda, and no requests were received to change the content or order of the agenda.

3. Minutes:

Gary Hornbuckle commented that he thought the Minutes were very well prepared.

The Committee received a written status report from CAWD Treatment Plant Superintendent, Mark Scheiter regarding treatment plant operations.

Member Townsend pointed out that the system was "Officially" sending water to Forest Lake Reservoir and questioned why, at this point, the term "Officially" was used. PBCSD District Engineer, Michael Niccum, replied that prior to end of January water was sent to the reservoir to allow testing of the liner for leaks. permission had been received from the State to fill the Reservoir to capacity.

4-B. Distribution System O & M; reclaimed and potable water use

PBCSD District Engineer, Michael Niccum, reviewed his Distribution System Operations Report, dated March 17, 2006 and indicated that it had been a routine period.

Member Stevens asked how many acre feet the winter rains had added to the Reservoir. Mike Niccum replied that thethe recent rain of approximately 2.5 inchess had addeded approximately 3 acre feet of water to the reservoir.

4-C. Consolidated Financial Statements from July 2005 through December 2005

Barbara Buikema reviewed the financial statements for the period from July 2005 through December 2005. She stated that the is a slow time for the Project and that there has not been a lot of activity to report. Accountant Buikema reviewed the various account balances and account activity.

Barbara stated that the O & M revenue and Expense account has a positive variance of $438,259 and shows a net cash income through January 2006 of $700,857. She reported that water sales and purchase of potable water are both significantly over and under budget respectively. She further reported that Cal-Am Water had made an error in the meter reading in November after payment had been made; hence there will be a credit balance of $53,000. Ms. Buikema advised that receivable from CAWD for electrical use at the lab has been suspended due to repair of the meter. Once work is completed, the District will adjust past usage as appropriate.

Ms. Buikema stated that she had no further comments to offer regarding the financial statements and would respond to any questions the Committee members had.

Gary Hornbuckle questioned where the potable water entered the system. and where the meter was located. Mr. Niccum responded potable water enters the recycled water distribution system through a single meter located adjacent to the 2.5 million gallon recycled water storage tank.

It was reported that the Company has sold 105 acre feet of water, leaving 70 acre feet still available. Rick Verbanec stated that there is a 200 resident turnover in the Forest annually, so the demand for water entitlements will continue. Mark Verbonich stated that there still is an interest in purchasing water within the Forest.

Following questions and answers, the O & M Financial Statements for the period were received for information and no action was required or taken by the Committee.

CAWD General Manager, Ray von Dohren, reviewed his staff report and reported that Carrollo and the District are approaching the completion of the 30% design, at which time the contractor will develop a "Guaranteed Maximum Price" will to be submitted to the Pebble Beach Company for negotiation. He reported that the issue regarding whether or not the use of gypsum would be required had been discussed and that there will be a need for gypsum in order to produce the quality of water required at all times. He also reported that and existing blower will have to be revamped in order to produce enough air for operation of the system. Mr. von Dohren also stated that application for a Coastal Development Permit was submitted to the Coastal Commission on February 7, 2006 and that he had been notified by the Coastal Commission that the application was complete. Member Hornbuckle questioned what the Coastal Commission could do to the project. Mr. von Dohren replied that there may be a requirement for an amendment to CAWD’s existing Coastal Permit. Mr. von Dohren further reported that test piles had been driven and that the results will be used for final design of the "production" piles.

PBCSD District Engineer Mike Niccum, in addition to his written report, presented a slide show, together with comments, showing the progress made to date on construction of the Reservoir. . Mr. Niccum advised that 51 potential leaks in the liner had been identified discovered and repaired prior to filling. Mr. Niccum further reported that the contractor has completed installation of the gates and weirs on the openings of the outlet structure., testing the stainless steel pipine for the algae control air system. Mr. Niccum stated that the Reservoir is now at two-thirds capacity and that PBCSD has received permission from the California Department of Water Resources, Division of Safety of Dams to file the Reservoir to the permitted capacity completely. He further stated that the Coastal Commission has advised that a Coastal Permit will be required.

Mr. Niccum pointed out that the fencing around the perimeter of the Reservoir has been raised to eight feet in order to keep the deer out of the Lake. In addition, a boat and outboard motor and rescue flotation devices have been purchased to be used for maintenance. A rope barrier has been placed around the immediate Lake area with life preservers attached to bollards for use in rescue in the case of someone having fallen into the Lake. Also, ropes have been attached to the bollards and run down the sides of the Reservoir to enable anyone in the Lake to pull themselves up the embankment.

Current cost estimates for construction have been increased to approximately $12.531 million dollars. Mr. Niccum reported that the District is currently dealing monitoring with an algae growth in the reservoirproblem and that the use of copper sulfate will can be used to kill the full algae bloom if the the reservoir cannot be kept balanced naturally algae. In addition, chlorine tablets will be used to clear algae from added to the recycled water prior to the distribution pipeline and to reduce the potential for algae growth in keep the piping clear. Runoff from the heavy rains have eroded the berm, which will have to be repaired. The DSOD has required additional sand slurry backfill for trenching in the reservoir embankments to keep water runoff from continuing to intrude into the berm.

There were no further questions, comments or action taken by the Committee.

Tom Peterson Charles Kemp of Cal-Am Water Company reported that one of the two tanks is out of service for repair to the beam structure and that they are operating on one tank.

It was reported that the "Rate" case would not be settled by before the end of April, 2006.

The Committee did not meet in a closed session.

8. Adjournment & Next Meeting Date:

There being no further business at 10:30 a.m., it was moved by Charlotte Townsend and seconded by Joyce Stevens, and determined by consensus of the members, that the Reclamation Management Committee adjourn to its next regular meeting on Friday, May 19, 2006 at 9:30 a.m. in the PBCSD Boardroom at 3101 Forest Lake Road, Pebble Beach.

Respectfully submitted:
Fay A. Webb
Secretary to the Board
Carmel Area Wastewater District