MPWMD June 3, 2014 Ballot Initiative Documents

8/12/2019 MPWMD June 3, 2014 Ballot Initiative Documents

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Draft Ordinance No ____

Monterey Peninsula Water System Local Ownership and Cost Savings Initiative

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DRAFT

ORDINANCE NO. ___

AN ORDINANCE OF THE BOARD OF DIRECTORS OF THE

MONTEREY PENINSULA WATER MANAGEMENT DISTRICT

THE MONTEREY PENINSULA WATER SYSTEM

LOCAL OWNERSHIP AND COST SAVINGS INITIATIVE

The people of the Monterey Peninsula Water Management District do ordain as follows:

Title: The Monterey Peninsula Water System Local Ownership and Cost Savings Initiative

Section IName

This Measure shall be designated as the Monterey Peninsula Water System Local Ownership andCost Savings Initiative.

Section IIPurpose

The purpose of the Measure is to ensure the long-term sustainability, reliability, cost-effectiveness and quality of water service within the Monterey Peninsula Water ManagementDistrict as a whole, to lower the cost of monthly service to rate-payers, to promote sound water

management measures, and to establish public ownership of water system assets, by establishingregulations requiring the District to take affirmative action, to the extent financially feasible, toacquire the water system assets owned and operated by the California American Water Companythat currently provide water service to the District and its ratepayers.

Section IIIFindings

1. Water service in the Monterey Peninsula is currently supplied by the California AmericanWater Company (Cal Am), a private, investor-owned utility that acquired the currentwater system beginning in 1966.

2. Due in substantial part to Cal Ams long history of failure in responsibly developing andcompetently managing the water resources under its control, the Monterey Peninsulacurrently suffers from an insufficient and unreliable supply of potable water. In 1995, forexample, the State Water Resources Control Board ordered Cal Am to cease diverting

water from the Carmel River after years of irresponsible over-pumping and unlawfuldiversions. Likewise, in 2007 a State Superior Court ordered Cal Am to restrict itspumping from the Seaside Groundwater Basin in an effort to protect the aquifer fromover-drafting by Cal Am. Moreover, under Cal Ams ownership and management, the


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San Clemente Dam water storage facility has deteriorated to the extent that it is nowuseless and will be removed at the ratepayers expense.

3. Cal Am has initiated three new water supply projects since the 1990s, all of which havefailed, most recently in 2011. As a result, stranded costs in excess of $35 million havebeen incurred and approved by the California Public Utilities Commission (CPUC) to

be passed on to current ratepayers. None of these stranded costs have been assumed byCal Am or its investors.

4. Cal Am ratepayers have historically endured paying rates for water service that farexceed the state average. In fact, Cal Ams rates are among the highest in the state forservice populations of comparable size. They are also extremely unpredictable: frommid-2010 to mid-2013 Cal Am added new water charges over 25 times, an average ofonce every 45 days. Over the same period, Tier 2 and Tier 3 residential rates increased117 percent, or about 35 percent each year. Rapidly changing and increasing rates alarmratepayers, with no relief in sight.

5. As a result of CPUC regulatory practices, Cal Am can only increase its profits based onhow much money it invests. This investment return-based model inherently shortchangesratepayers by giving Cal Am little or no incentive to pursue viable non-revenuegenerating alternatives to develop or enhance water supply in Monterey Peninsula.

6. Approximately 85 percent of the nations water service consumers receive their waterfrom public water providers. According to a national survey conducted by Food andWater Watch, customers of for-profit water companies pay on average 33 percent higherrates for service than customers of public providers.

7. The ratepayers overriding urgent need for new reliable and affordable water sources is

best met through the Monterey Peninsula Water Management District (District), whoseprimary duty is to benefit the citizens of the District, and not the profitability each projectrepresents to the investors of a for-profit water monopoly.

8. The District was established in 1977 by the Monterey Peninsula Water ManagementDistrict Law (District Law), which charges the District with the integratedmanagement of the ground and surface water resources in the Monterey Peninsula area.The District retains broad powers under the District Law to do any and every lawful actnecessary in order that sufficient water may be available for the present or futurebeneficial use or uses of the lands or inhabitants within the district.

9. The District Law likewise grants the District broad powers to acquire public or privatewater systems necessary or proper to carry out the purposes of the Law, and expresslygrants the District the power of eminent domain to do so.

10. The voters of the District assert that the District should, as soon as practicable and to theextent permitted by law, pursue the acquisition of Cal Ams water system assets andinfrastructure in order to deliver maximum value to ratepayers in perpetuity. Such publicownership of the water system not only will remove Cal Ams current for-profit,


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investor-driven bias, but will also eliminate the excessive fees, costly procedures, andburdensome jurisdictional control of the CPUC over water service on the MontereyPeninsula.

Section IV An Ordinance of the Monterey Peninsula Water Management District.

The following Rule 19.8 shall be added to the Monterey Peninsula Water ManagementDistrict, Rules and Regulations, Regulation I, General Provisions:

Rule 19.8. Policy of Pursuing Public Ownership of Monterey Peninsula Water System

A. It shall be the policy of the District to establish and maintain public ownership of allwater delivery system assets and infrastructure within its territory, and therefore toacquire, if economically feasible, preferably through negotiation but through eminentdomain if necessary, all assets of Cal Am, or any successor in interest to Cal Am, withinthe Districts territory, as soon as reasonably practicable for the benefit of the District asa whole.

B. In furtherance of this policy the General Manager shall, within nine (9) months of theeffective date of this Rule 19.8, complete and submit to the Board of Directors foracceptance, a Feasibility Analysis and Acquisition Plan for the acquisition, long-termownership, and management by the Monterey Peninsula Water Management District ofCal Ams assets that provide water service within the District that together develop,store, transmit and deliver potable water to all users within District, including but notlimited to the following assets: extraction wells; injection wells; pump stations; piping;storage tanks and reservoirs; meters and other connections; administrative offices andsupport buildings; rolling vehicle stock; maintenance and operational equipment(hereafter collectively referred to as the Water System Assets).

The Feasibility Analysis and Acquisition Plan shall include, but not necessarily belimited to, the following components.

i. An estimate of the costs of acquisition of the Water System Assets based on anappraisal of their fair market value, together with any associated legal andadministrative costs.

ii. A projection of the annual capital and operating costs, revenues, and savings toratepayers that would result from the Districts ownership and management ofthe Water System Assets.

iii. An identification of all potential sources of funds sufficient to acquire the WaterSystem Assets at the estimated acquisition cost, including revenue bonds, notes,levies, fees, taxes, and any other source that the District is authorized by law toprocure.

iv. A statement, based on findings of fact set forth in the body of the FeasibilityAnalysis and Acquisition Plan, of whether the ratepayers within the District as a


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whole will realize a long-term net benefit from the Districts acquisition of theWater System Assets, both in terms of cost-effectiveness and in terms of longterm service reliability.

v. A determination, based on the appraised fair market value of the Water SystemAssets reported in the Feasibility Analysis and Acquisition Plan, of the total

amount that would constitute just compensation for the Water System Assets ifacquired by the District.

vi. A list of tasks or steps that the District, acting through its Board, the GeneralManager or other staff or consultants, would be required by law to take in orderto acquire the Water Systems Assets through the exercise of its eminent domainpower or otherwise, together with an estimate of the amount of time required tocarry out each task or step, as well as the associated administrative costsassociated with the carrying out each task or step.

C. If the final accepted Feasibility Analysis and Acquisition Plan concludes that the

acquisition and long-term management of the Water System Assets by the MontereyPeninsula Water Management District is both feasible and beneficial to ratepayers withinthe District as a whole, then the Board shall, as soon as practicable, take all necessary andproper actions consistent with its powers under the District Law, the Eminent DomainLaw, and any other applicable law or regulation, for the Monterey Peninsula WaterManagement District to acquire the Water System Assets through a negotiated purchaseand sale agreement if possible, or otherwise through eminent domain.

Section V Modification Only By Vote of the People

No provision of this Measure shall be changed, amended, or repealed except by a vote of the

People.

Section VI Effective Date; Application.

The provisions of this Measure shall take effect immediately upon certification of its passage bythe appropriate Election Official. Pending actions or proposals otherwise governed by thisInitiative that have been initiated by the Board of Directors of the District, but that are not yetfinal as of the effective date, or that are the subject of pending legal challenge, shall be subject tothe provisions of this Measure.

Section VII Severability

This Measure shall be broadly construed in order to achieve the purposes stated in this Measure.If any section, sub-section, sentence, clause, phrase, part, or portion of this Measure is held to beinvalid or unconstitutional by a final judgment of a court of competent jurisdiction, such decisionshall not affect the validity of the remaining portions of the Measure. The voters of theMonterey Peninsula Water Management District hereby declare that this Measure, and eachsection, sub-section, sentence, clause, phrase, part, or portion thereof would have been adoptedor passed even if one or more sections, sub-sections, sentences, clauses, phrases, parts, or


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portions are declared invalid or unconstitutional. If any provision of this Measure is held invalidas applied to any person or circumstance, such invalidity shall not affect any application of thisMeasure that can be given effect without the invalid application.

Section VIII Conflicting Ballot Measures

In the event that this Measure and another measure or measures relating to the same or similarsubject matter shall appear on the same election ballot, the provisions of the other measures shallbe deemed in conflict with this measure. In the event that this Measure shall receive a greaternumber of affirmative votes, the provisions of this Measure shall prevail in their entirety, and theprovisions of the other measure or measures shall be null and void.

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RESOLUTION NO. 2014-02

A RESOLUTION OF THE BOARD OF DIRECTORS OF THEMONTEREY PENINSULA WATERMANAGEMENT DISTRICTORDERING AN ELECTION,

REQUESTING COUNTY ELECTIONS TO CONDUCT THE ELECTIONAND REQUESTING CONSOLIDATION OF THE ELECTION

WHEREAS On September 6, 2013, Public Water Now submitted to the MontereyPeninsula Water Management District (Water Management District or District) a Notice oflntentto Circulate an Initiative Petition entitled the Monterey Peninsula Water System LocalOwnership and Cost Saving Initiative, and Proof of Publication of the Notice; andWHEREAS the stated purpose of the Initiative Petition is to establish a policy toacquire, if economically feasible, the water system assets of the California-American WaterCompany (Cal-Am) within the District's territory, either through negotiation or through theexercise of eminent domain power; and WHEREAS the stated reasons for the action are to ensure the long-term sustainability,reliability, cost-effectiveness and quality of water service within the Monterey Peninsula WaterManagement District as a whole, to lower the cost ofmonthly service to rate-payers, to promotesound water management measures, and to establish public ownership ofwater system assets, byestablishing regulations requiring the District to take affirmative action, to the extent financiallyfeasible, to acquire the water system assets owned and operated by California American WaterCompany that currently provide water service to the District and its ratepayers ; andWHEREAS the Initiative Petition contains a proposed Ordinance (Measure) that addsRule 19.8 to the District Rules and Regulations and requires the General Manager, within ninemonths of Rule's effective date, to complete a Feasibility Analysis and Acquisition Plan for theacquisition, long-term ownership, and management by the District of Cal-Am's assets. If thePlan concludes acquisition is feasible, the District shall, as soon as practicable, take all necessaryand proper actions consistent with its powers under District Law and Eminent Domain Law toacquire Cal-Am's water system assets; andWHEREAS the Initiative Petition requests the Measure be submitted to the voters atthe earliest regular or special election for which it qualifies pursuant to Section 1405 ofCalifornia Elections Code ; andWHEREAS on January 21, 2014 the Monterey County Registrar of Voters verified asufficient number of signatures on the Initiative Petition; andWHEREAS pursuant to California Elections Code 9310, the Board ofDirectors musteither 1 Adopt the ordinance, without alteration, either at the regular meeting at which the

5 Harris Court Building G Monterey CA 93940 P.O. Box 85 Monterey CA 93942-0085831-658-5600 Fax 831-644-9560 http:/ www mpwmd net


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Final MPWMD Resolution No. 2014-02 - Ordering an ElectionRequesting County Elections to Conduct the Election and Request ing Consolidationof he Election

certification of the petition is presented, or within 1 days after it is presented; or 2) Immediatelyorder that the ordinance be submitted to the voters, without alteration, pursuant to subdivision a)ofSection 1405; andWHEREAS the District Board of Directors has determined to order the proposed be

submitted to the voters, without alteration; andWHEREAS California Elections Code section 1405 a) provides that with certainexceptions, the election for a district initiative that qualifies pursuant to Section 9310 shall beheld not less than 88 nor more than 103 days after the date of the order of election; andWHEREAS pursuant to section 1405, the election on the measure may be consolidatedwith the state regular or special election; andWHEREAS the Resolution of the governing body of District shall specify the servicesrequested; andWHEREAS pursuant to Elections Code Section 10002, the District shall reimburse thecounty in full for the services performed upon presentation of a bill; andWHEREAS pursuant to Elections Code Section 10400, whenever two or more elections,including bond elections, of any legislative or congressional district, public district, city, county,or other political subdivision are called to be held on the same day, in the same territory, or interritory that is in part the same, they may be consolidated upon the order of the governing bodyor bodies or officer or officers calling the elections; ~WHEREAS pursuant to Elections Code Section 10403, whenever an election called y a

district, city or other political subdivision for the submission of any question, proposition, oroffice to be filled is to e consolidated with a statewide election, and the question, proposition, oroffice to be filled is to appear upon the same ballot as that provided for that statewide election,the district, city or other political subdivision shall, at least 88 days prior to the date of theelection, file with the County Board of Supervisors, and a copy with the elections official, aresolution of its governing board requesting the consolidatiop. and setting forth the exact form ofany question, proposition, or office to be voted upon at the election, as it is to appear on theballot. Upon such request, the Board ofSupervisors may order the consolidation; andWHEREAS pursuant to Elections Code Section 10400, such election for cities andspecial districts may be either completely or partially consolidated; andWHEREAS the resolution requesting the consolidation shall e adopted and filed at thesame time as the adoption of the ordinance, resolution, or order calling the election; andWHEREAS various district, county, state and other political subdivision elections maybe or have been called to be held on June 3, 2014;WHEREAS the Board of Directors for the Monterey Peninsula Water ManagementDistrict Water Management District) desires to call an election on the Measure to beconsolidated with the state primary on June 3, 2014; and

M o N w ~ r l t RMANAGEMENT DISTRICT


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Final MPWMD Resolution No. 2014 02 Ordering an ElectionRequesting County Elections t Conduct the Election and Requesting Consolidation of he Election

WHEREAS the Board of Directors acknowledges that the consolidated election will beheld and conducted in the manner prescribed in Section 10418; andNOW THEREFORE E IT RESOLVED AND ORDERED THAT the governing

body of the Water Management District hereby orders the Monterey County ElectionsDepartment to conduct the election to approve or reject the Measure set forth in the MontereyPeninsula Water System Local Ownership and Cost Saving Initiative, on the June 3 2014ballot; andE IT FURTHER RESOLVED ND ORDERED that said governing body of theWater Management District hereby orders the election consolidated with any and all electionsalso called to be held on June 3, 2014 insofar as said elections are to be held in the same territoryor in territory that is in part the same as the territory of the Water Management District, andrequests the Board of Supervisors to order such consolidation under Elections Code Section

10401 and 10403; andE IT. FURTHER RESOLVED AND ORDERED that said governing body herebyrequests the Board of Supervisors to permit the Monterey County Elections Department toprovide any and all services necessary for conducting the election and agrees to pay for saidservices; and

On motion ofDirector Byrne,. and second by Director Markey, the foregoing resolution isduly adopted this 29th day of January, 2014 y the following votes:AYES:NAYS:

Directors Byrne, Markey, Thayer, Pendergrass and PotterNoneABSENT: Directors Brower and Lewis

I David J. Stoldt, Secretary to the Board of Directors of the Monterey Peninsula WaterManagement District, hereby certify that the foregoing is a resolution duly adopted on the 29thday of January, 2014.Witness my hand and seal of the Board of Directors this ) I"'day of February, 2014.

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M o N w ~ r i t RMANAGEMENT DISTRICT


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COPY CERTIFIC TIONI David J. Stoldt Secretary to the Board o Directors o the Monterey Peninsula WaterManagement District hereby certify the foregoing is a full true and correct copy oResolution No. 2014-02 duly adopted on the 29th day o January 2014.

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Calendar for Preparation of June 3, 2014 Ballot InitiativePrepared by MPWMD, Updated February 25, 2014

March 7, 2014Last day to Submit Resolutions of Consolidation

Final deadline for the governing body of a district, city, school or other political subdivision which requests

consolidation of a local election for candidates or measures to file the request with the county Elections

Department.

March 14, 2014-- Primary Arguments

Last day to file with Monterey County Elections primary arguments in favor of or against local ballot

measures.

March 24, 2014-- Rebuttal Arguments

Last day to file with Monterey County Elections rebuttal arguments in favor of or against local ballot

measures. Impartial Analysis regarding local ballot measures due.

Please contact Monterey County Elections for the complete election calendar

http://www.montereycountyelections.us/or 831-796-1499.

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http://www.montereycountyelections.us/http://www.montereycountyelections.us/http://www.montereycountyelections.us/


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J N 21 2 14MONTEREY COUNTY ELECTIONS _P_ WM....... p \ E ~ ~ ~ ; : : 1 1PO Box 4400Salinas C 93912 1370-B South Main StreetSalinas C 93901www.MontereyCountyEiections. us

831-796-1499 Phone831-755-5485 [email protected]

The Monterey Peninsula Water Service Local Ownership and Cost Savings InitiativeWHEREAS, pursuant to Government Code section 67659, the Monterey Peninsula Water Management Districtis deemed a district for purposes of initiative and referendum, with the voters ofthe authority being the votersof said district.WHEREAS, On January 3, 2014 the initiative petition was submitted to the Monterey Peninsula WaterManagement District.

WHEREAS, On January 6, 2014 the initiative petition was transferred to the Registrar ofVoters office forsignature verification.WHEREAS, the peti tion contained 8,517 signatures for verification.WHEREAS, Elections Code section 9309 allows for the Registrars office to use a random sampling techniquefor verification:

9309 (a) Within 30 days from the date of filing of the petition, excluding Saturdays, Sundays, andholidays, if, from the examination of petitions pursuant to Section 9308, more than 500 signatures havebeen signed on the petition, the district elections official may use random sampling technique forverification of signatures. The random sample of signatures to be verified shall be drawn in such mannerthat every signature filed with the elections official shall be given an equal opportunity to be included inthe sample. A random sampling shall include an examination of at least 500 or 3 percent of thesignatures, whichever is greater.(b) Ifthe statistical sampling shows that the number of valid signatures is within 95 to 110 percent ofthenumber of signatures of qualified voters needed to declare the petition sufficient, the district electionsofficial, within 60 days from the date of the filing of the petition, excluding Saturdays, Sundays, andholidays, shall examine and verify each signature filed.(c) In determining from the records of registration, what number ofvalid signatures is signed on thepetition, the district elections official may use the duplicate file of affidavits maintained, or may checkthe signatures against facsimiles of voters ' signatures, provided that the method of preparing anddisplaying the facsimiles complies wi th law.(d) The district elections official shall attach to the petition, a certificate showing the result of thisexamination, and shall notify the proponents of either the sufficiency or insufficiency of the petition.(e) If the petition is found insufficient, no action shall betake on the petition. However, the failure tosecure sufficient signatures shall not preclude the filing later of an entirely new petition to the sameeffect.(f) If the petition is found to be sufficient, the district elections official shall certify the results of theexamination to the governing board of the district at the next regular meeting of the board.

WHEREAS, Elections Code section 9310 provides that the minimum number of signatures required for aninitiative petition submitted to a district is not less than 10 percent of the voters in the district, and there are56,237 voters in the district.


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WHEREAS, ofthe 8,517 signatures submitted for verification, 500 signatures were verified y the Registrarsoffice in the random sampling.WHEREAS, of the 500 signatures verified in the random sampling, 444 (88.8 ) were deemed valid.WHEREAS, the projected number ofvalid signature on said petition is 7,563.NOW, THEREFORE, this office has determined that the initiative petition submitted to the Monterey PeninsulaWater Management District on January 3, 2014 contains 134 percent of the qualified voters needed.

Claudio ValenzuelaActing Registrar ofVotersCounty ofMonterey2 st day of January, 2014


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tt:o5 a YVI RECEIVEDINITIATIVE MEASURE TO BE SUBMITTED DIRECTLY TO THE VOTERS

SEP 6 2 13TITLE: THE MONTEREY PENINSULA WATER SERVICE LOCAL OWNERSHIP AND

COST SAVINGS INITIATIVE MD'A'rvlnNOTICE OF INTENTION TO CIRCULATE PETITION AND STATEMENT OF REASONSNotice is hereby given of the intention of the persons whose names appear hereon of their intention to circulatethe petition within the Monterey Peninsula Water Management District ( District ) for the purpose ofestablishing a policy to acquire, if economically feasible, the water system assets of the California AmericanWater Company within the District's territory, ei ther through negotiation or through the exercise of eminentdomain power if necessary. A statementof the reasons for the proposed action as contemplated in the petitionis as follows: the purpose of this Measure is to ensure the lol']g-term sustainability, reliability, cost-effectivenessand quality of water service within the Monterey Peninsula Water Management D'istrict as a whole, to lower thecost of monthly service to rate-payers, to promote sound water management measures, and to establish publicownership of water system assets, by establishing regulations requiring the District to take affirmative action, tothe extent financially feasible, to acquire the water system assets owned and operated by the CaliforniaAmerican Wate r Company that currently provide water service to the District and its ratepayers.Signed: /s/ Ronald T Cohen, /s/ George Riley, /s/ Douglas W. Wilhelm, and /s/ Harvey Billig

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NOTICE TO THE PUBLICTHIS PETITION MAY BE CIRCULATED BY A PAID SIGNATURE GATHERER OR A VOLUNTEER.YOU HAVE THE RIGHT TO ASK.

ALL SIGNERS OF THIS PETITION MUST BE REGISTERED TO VOTE INTHE MONTEREY PENINSULA WATER MANAGEMENT DISTRICT.Print Name Residence Address ONLY

Signature as Registered City Zip

Print Name Residence Address ONLY





Signature as Registered City ZipIPrint Name Residence Address ONLY

,:;.:Signature as Registered City Zip







Print Name Residence Address ONLYSignature as Registered City Zip



Official use only

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INITIATIVE MEASURE TO BE SUBMITTED DIRECTLY TO THE VOTERSTITLE: THE MONTEREY PENINSULA WATER SERVICE LOCAL OWNERSHIP ANDCOST SAVINGS INITIATIVE

To the Board of Directors of the MontereyPeninsula Water Management District:We, the undersigned, registered and qualifiedvoters of the Monterey Peninsula WaterManagement District ( District ), present to theBoard of Directors this petition and request that thefollowing proposed Ordinance ( Measure ) besubmitted to the registered and qualified voters ofthe District for their adoption or rejection at theearliest regular or special election for which it .qualifies pursuant to Section 1405 of the CaliforniaElections Code. The full text ofthe Measure is asfollows:The people of the Monterey Peninsula WaterManagement District do ordain as follows:Title: The Monterey Peninsula Water SystemLocai Ownership and Cost Savings InitiativeSection 1 NameThis Measure shall be designated as the MontereyPeninsula Water System Local Ownership andCost Savings Initiative.Section If PurposeThe purpose of he Measure is to ensure the longterm sustainability, reliability, cost-effectivenessand quality of water service within the MontereyPeninsula Water Management District as a whole,to lower the cost of monthly service to rate-payers,to promote sound wa ter management measures,and to establish public ownership of water systemassets, by establishing regulations requiring theDistrict to take affirmative action, to the extentfinancially feasible, to acquire the water systemassets owned and operated by the CaliforniaAmerican Water Company that currently providewater service to the District and its ratepayers.Section Ill Findings1 Water service in the Monterey Peninsula is currently supplied by the California American WaterCompany ( Cal Am ), a private, investor-ownedutility that acquired the current water systembeginning in 1966.2. Due in substantial part to Cal Am's longhistory of failure in responsibly developing andcompetently managing the water resources underits control, the Monterey Peninsula currently suffersfrom an insufficient and unreliable supply of potablewater. In 1995, for example, the State WaterResources Control Board ordered Cal Am to ceasediverting water from the Carmel River after years ofirresponsible over-pumping and unlawfuldiversions. Likewise, in 2007 a State SuperiorCourt ordered Cal Am to restrict its pumping fromthe Seaside Groundwater Basin in an effort toprotect the aquifer from over-drafting by Cal Am.Moreover, under Cal Am's ownership and

management, the San Clemente Dam wate rstorage facility has deteriorated to the extent that itis now useless and will be removed at theratepayers' expense.3 Cal Am has initiated three new water supplyprojects since the 1990s, all of which have failed,most recently in 2011. As a result, stranded costs inexcess of $35 million have been incurred andapproved by the California Public UtilitiesCommission ( CPUC ) to be passed on to currentratepayers. None of these stranded costs havebeen assumed by Cal Am or its investors.4. Cal Am ratepayers have historically enduredpaying rates for water service that far exceed thestate average. In fact, Cal Am's rates are amongthe highest in the state for service populations ofcomparable size. They are also extremelyunpredictable: from mid-2010 to mid-2013 Cal Amadded new water charges over 25 times, anaverage of once every 45 days. Over the sameperiod, Tier 2 and Tier 3 residential rates increased117 percent, or about 35 percent each year.Rapidly changing and increasing rates alarmratepayers, with no relief in sight.5 As a result of CPUC regulatory practices,Cal Am can only increase its profits based on howmuch money it invests. This investment returnbased model inherently shortchanges ratepayersby giving Cal Am little or no incentive to pursueviable non-revenue generating alternatives todevelop or enhance water supply in MontereyPeninsula.6. Approximately 85 percent of the nation'swater service consumers receive their water frompublic water providers. According to a nationalsurvey conqucted byJ ;ood and Water Watch,customers of for-profit water companies pay onaverage 33 percent higher rates for service thancustomers of public providers.7. The ratepayers' overriding urgent need fornew reliable and affordable water sources is bestmet through the Monterey Peninsula WaterManagement District ( District ), whose primaryduty is to benefit the citizens of the District, and notthe profitability each project represents to theinvestors of a for-profit water monopoly.8 The District was established in 1977 by theMonterey Peninsula Water Management DistrictLaw ( District Law ), which charges the Districtwith the integrated management of the ground andsurface water resources in the Monterey Peninsulaarea. The District retains broad powers under theDistrict Law to do any and every lawful actnecessary in order that sufficient water may beavailable for the present or future beneficial use oruses ofthe lands or inhabitants within the district. 9. The District Law likewise grants the Districtbroad powers to acquire public or private water

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INITIATIVE MEASURE TO BE SUBMITTED DIRECTLY TO THE VOTERSTITLE: THE MONJ EREY PENINSULA WATER SERVICE LOCAL OWNERSHIP ANDCOST SAVINGS INITIATIVE

systems necessary or proper to carry out thepurposes of the Law, and expressly grants theDistrict the power of eminent domain to do so.10. The voters of the District assert that theDistrict should, as soon as practicable and to theextent permitted by law, pursue the acquisition ofCal Am's water system assets and infrastructure inorder to deliver maximum value to ratepayers inperpetuity. Such public ownership of the watersystem not only will remove Cal Am's current forprofit, investor-driven bias, but will also eliminatethe excessive fees, costly procedures, andburdensome jurisdictional control of the CPUC overwater service on the Monterey Peninsula.Section V An Ordinance o the MontereyPeninsiJia Water Management District.The following Rule 19.8 shall be added to theMonterey Peninsula Water Management District,Rules and Regulations, Regulation I GeneralProvisions:Rule 19.8. Policy of Pursuing Public Ownership ofMonterey PeninsulaWater System A It shall be the policy of the District toestablish and maintain public ownership of all waterdelivery system assets and infrastructure within itsterritory, and therefore to acquire, if economicallyfeasible, preferably through negotiation but througheminent domain if necessary, all assets of Cal Am,or any successor in interest to Cal Am, within theDistrict's territory, as soon as reasonablypracticable for the benefit of the District as a whole.B. In furtherance of this policy the GeneralManager shall, within nine (9) months of theeffective date ofthis Rule 19.8, complete andsubmit to the Board of Directors for acceptance, aFeC sibility Analysis and Acquisition Plan for theacquisition, long-term ownership, and managementby the Monterey Peninsula Water ManagementDistrict of Cal Am's assets that provide waterservice within the District that toge ther develop,store, transmit and deliver potable water to all userswithin District, including but not limited to thefollowing assets: extraction wells; injection wells;pump stations; piping; storage tanks and reservoirs;meters and other connections; administrativeoffices and support buildings; rolling vehicle stock;maintenance and operational equipment (hereaftercollectively referred to as the "Water SystemAssets").

The Feasibility Analysis and AcquisitionPlan shall include, but not necessarily be limited to,the following components.

i An estimate of the costs ofacquisition of the Water System Assets based onan appraisal of their fair market value, together withany associated legal and administrative costs.

ii. A projection of the annual capitaland operating costs, revenues, and savings toratepayers that would result from the District'sownership and management of the Water SystemAssets.iii. An identification of all potentialsources of funds sufficient to acquire the WaterSystem Assets at the estimated acquisition cost,including revenue bonds, notes, levies, fees, taxes,and any other source that the District is authorizedby law to procure.iv. A statement, based on findings offact set forth in the body of the Feasibility Analysisand Acquisition Plan, of whether the ratepayerswithin the District as a whole will realize a long-term

net benefit from the District's ac;quisition of theWater System Assets, both in terms of costeffectiveness and in terms of long term servicereliability.v. A determination, based on theappraised fair market value of the Water System

Assets reported in the Feasibility Analysis andAcquisition Plan, of the total amount that wouldconstitute just compensation for the Water SystemAssets if acquired by the District.vi. A list of tasks or steps that theDistrict, acting through its Board, the GeneralManager or other staff or consultants, would berequired by law to take in order to acquire theWater Systems Assets through the exercise of itseminent domain power or otherwise, together withan estimate of the amount of time required to carry

out each task or step, as well as the associatedadministrative costs associated with the carryingout each task or step.C. If the final accepted Feasibility Analysis andAcquisition Plan concludes that the acquisition andlong-term management of the Water SystemAssets by the Monterey Peninsula WaterManagement District is both feasible and beneficialto ratepayers within the District as a whole, then theBoard shall, as soon as practicable, take allnecessary and proper actions consistent with itspowers under the District Law, the Eminent DomainLaw, and any other applicable law or regulation, forthe Monterey Peninsula Water Management Districtto acquire the Water System Assets through anegotiated purchase and sale agreement ifpossible, or otherwise through eminent domain.Section Modification Only By Vote o the.PeopleNo provision of this Measure shall be changed,amended, or repealed except by a vote ofthePeople.Section VI - Effective Date; Application.The provisions of this Measure shall take effectimmediately upon certification of its passage by the

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INITIATIVE MEASURE TO BE SUBMITTED DIRECTLY TO THE VOTERSTITLE THE MONTEREY PENINSULA W TER SERVICE LOCAL OWNERSHIP AND

COST SAVINGS INITIATIVEate Election Official. Pending actions or

of Directors of theof the effective

or that are the subject of pending legalof this

Severability

purposes stated in this Measure. If anyor portion of this Measure is held to be invalidunconstitutional by a final judgment of a court of, such decision shall not

of the remaining portions of theThe voters of the Monterey Peninsulagement District hereby declare that thisor portion thereof would have

been adopted or passed even if one or moresections, sub-sections, sentences, clauses,phrases, parts, or portions are declared invalid orunconstitutional. If any provision of this Measure isheld invalid as applied to any person orcircumstance, such invalidity shall not affect anyapplication of this Measure that can be given effectwithout the invalid application.Section VIII Conflicting Ballot MeasuresIn the event that this Measure and anothermeasure or measures relating to the same orsimilar subject matter shall appear on the sameelection ballot, the provisions of the other measuresshall be deemed in conflict with this measure. Inthe event that this Measure shall receive a greaternumber of affirmative votes, the provisions of thisMeasure shall prevail in their entirety, and theprovisions of the other measure or measures shallbe null and void.

O CIRCULATOR (to be handwritten by the circulator after all signatures on this section ofbeen obtained)

: = : : : ~ : : : : : : ; : : ; : : : am a voter or qualified to register to vote in the StateCalifornia, and reside at the following address:

Address, City, State, Zip)this petition section and witnessed each appended signature on this section being written. All ofether at the time such signatures were made. Toof my information and belief, each signature is the genuine signature of the person whose name it

document were obtained between:

- ; ; :o - : - - - : - : : - - : - . , - - - : - - ; - - - 20 and , . .---;--:-------- 20__.Date of first signature) Date of final signature)

r penalty of perjury under the laws of the State of California, that the foregoing is true and

(Circulator s Printed Name) (Circulator s Signature)

xecuted at - - - - - - - - - - - - - - - - California. --;;;::-;-;:;---;:-------Date Signed)

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