STATE WATER RESOURCES CONTROL BOARD PUBLIC WORKSHOP APRIL 21 - 22, 1998, WORKSHOP ON THE HEARING PROCEDURES AND PROPOSED SETTLEMENT AGREEMENTS FOR THE BAY-DELTA WATER RIGHTS HEARING ---oOo--- RESOURCES BUILDING - FIRST-FLOOR AUDITORIUM SACRAMENTO, CALIFORNIA TUESDAY, APRIL 21ST, 1998 9:00 A.M. Reported by: MARY GALLAGHER, CSR #10749 CAPITOL REPORTERS (916) 923-5447 1 APPEARANCES ---oOo--- 2 3 BOARD MEMBERS: 4 JOHN CAFFREY, HEARING OFFICER JAMES STUBCHAER, CO-HEARING OFFICER 5 MARC DEL PIERO MARY JANE FORSTER 6 JOHN BROWN 7 STAFF MEMBERS: 8 WALT PETTIT - Executive Director 9 THOMAS HOWARD - Supervising Engineer VICTORIA A. WHITNEY - Senior Engineer 10 11 COUNSEL: 12 BARBARA LEIDIGH - Senior Staff Counsel 13 AUDIENCE: 14 ALAN B. LILLY 15 DANIEL B. STEINER TIM O'LAUGHLIN 16 KAMYAR GUIVETCHI JAMES R. WHITE 17 EDWARD D. WINKLER FRED S. ETHERIDGE 18 JOHN B. LAMPE MARC E. VAN CAMP 19 JOHN BURKE ALF W. BRANDT 20 STEPHEN H. OTTEMOELLER PATRICK PORGANS 21 DAVE SCHUSTER MICHAEL B. JACKSON 22 DAVID SANDINO VIRGINIA CAHILL 23 JEANNE ZOLEZZI STEVE MACAULAY 24 25 CAPITOL REPORTERS (916) 923-5447 2 1 C O N T I N U E D ---oOo--- 2 APPEARANCES: 3 TOM GRAFF 4 KEVIN O'BRIEN RALF CARTER 5 BILL BABER PAUL SIMMONS 6 ANDREW M. HITCHINGS PATRICK WRIGHT 7 GREG THOMAS NANCEE MURRAY 8 BILL LOUDERMILK FRANK WERNETTE 9 STEVE CHEDESTER ROGER GUINEE 10 THOMAS SHEPHARD REID ROBERTS 11 MICHAEL SEXTON CLIFF SCHULZ 12 GARY BOBKER LOWELL PLOSS 13 DAN GALLERY ALEX HILDEBRAND 14 DANTE JOHN NOMELLINI CYNTHIA KOCHLER 15 JEANNE CAVE RICHARD DENTON 16 MARTHA LENNIHAN ALLEN SHORT 17 KEN ROBBINS PATRICK WRIGHT 18 WILLIAM BABER RICHARD GOLB 19 TIM QUINN JOHN HERRICK 20 21 ---oOo--- 22 23 24 25 CAPITOL REPORTERS (916) 923-5447 3 1 I N D E X 2 ---oOo--- 3 4 PAGE 5 OPENING OF HEARING 5 6 AFTERNOON SESSION 116 7 END OF PROCEEDINGS 236 8 PRESENTATIONS: 9 VERNALIS ADAPTIVE MANAGEMENT PLAN 14 10 11 12 ---oOo--- 13 14 15 16 17 18 19 20 21 22 23 24 25 CAPITOL REPORTERS (916) 923-5447 4 1 TUESDAY, APRIL 21, 1998, 9:00 A.M. 2 SACRAMENTO, CALIFORNIA 3 ---oOo--- 4 HEARING OFFICER CAFFREY: Thank you all for your 5 attention. I'm going to read a statement into the record, 6 which is our usual practice. 7 Good morning and welcome to this workshop on the 8 hearing procedures and proposed settlement agreements for 9 the Bay Delta Water Rights Hearing. I am John Caffrey, 10 Chairman of the State Water Resources Control Board. Let 11 the record show that the full Board is present. 12 Proceeding from my far left are Board Members Marc 13 Del Piero and Mary Jane Forster. 14 MEMBER FORSTER: Good morning. 15 HEARING OFFICER CAFFREY: From my far right are Board 16 Members John Brown and Board Vice-Chair James Stubchaer. 17 Mr. Stubchaer and I will co-chair this workshop and will be 18 co-hearing officers in the Bay Delta Water Rights Hearings 19 to follow. 20 Later today we'll be joined by Walt Pettit, our 21 Executive Director. He will sit with us to my far left. 22 Mr. Pettit is defending the Board as we speak in budget 23 hearings in Assembly. So we wish him well. 24 MEMBER DEL PIERO: If he doesn't do well, Mr. 25 Chairman, do we cancel this and file for unemployment? CAPITOL REPORTERS (916) 923-5447 5 1 HEARING OFFICER CAFFREY: That remains to be seen, 2 Mr. Del Piero. We'll have to see Mr. Pettit's scorecard 3 when he gets home. 4 At the staff table are Victoria Whitney, Senior 5 Engineer; Tom Howard, Supervising Engineer; and Barbara 6 Leidigh, Staff Counsel. Other staff also are present and 7 may assist us from time to time. 8 This workshop is being held in accordance with the 9 Notice of Public Workshop dated March 16th, 1998. If you 10 intend to speak today, please, fill out a blue card such as 11 the one I am holding up and give it to our staff at the 12 front table as soon as possible, if not immediately. 13 If you are not sure whether or not you're going to 14 speak today, please fill out a card anyway, and mark it "if 15 necessary." This way the Board will have some idea as to 16 how it needs to manage its time for the next two days and 17 possibly beyond if this process takes more than two days. 18 There are two issues listed in the notice of this 19 workshop. The first issue addresses the status, content, 20 and support for several negotiated agreements among the 21 parties to the Bay-Delta Water Rights Hearing. The second 22 issue addresses the organization of the hearing. All 23 parties are welcome to comment on each issue. 24 At this point I would like to comment briefly on 25 how the Board decided to hold this workshop. Over the past CAPITOL REPORTERS (916) 923-5447 6 1 three years as the Board has moved toward implementing the 2 objectives in the 1995 Bay-Delta Plan, the Board has 3 encouraged the parties to negotiate agreements with other 4 parties to settle their responsibilities to help meet the 5 objectives. A number of parties were negotiating, but had 6 not reached any agreements by the time we issued the water 7 rights hearing notice in December. 8 After we issued the notice, several parties 9 involved in negotiations asked the Board to reschedule and 10 restructure the hearing, first, to allow more time to 11 negotiate agreements. And, second, to restructure the 12 hearing to consider the agreements before other issues in 13 the hearing. 14 There was sufficient support for rescheduling the 15 hearing that we notified the parties on January 26th, 1998, 16 that we would convene this workshop today, to review the 17 negotiated agreements and to discuss the organization of 18 the upcoming hearing. 19 With that in mind, a primary issue in this 20 workshop is whether the State Water Resources Control Board 21 should consider the negotiated agreements first in a 22 separate hearing -- in a separate hearing before going on 23 to the other issues listed in the December 2nd, 1997, 24 hearing notice. An initial, separate hearing could be 25 structured to consider the agreements and the associated CAPITOL REPORTERS (916) 923-5447 7 1 changes in the water rights of the agreeing parties before 2 evaluating the responsibilities of the remaining water 3 right holders who have not entered into agreements. 4 Please, note that this workshop is not intended to 5 determine the adequacy of the negotiated agreements. Nor 6 is it a hearing on the draft Environmental Impact Report. 7 The State Water Board will decide upon the adequacy of the 8 agreements and on any issues regarding the draft 9 Environmental Impact Report after the water rights hearing. 10 In this workshop we are examining how to structure 11 the water rights hearing and what issue should be taken up 12 first. We are not here to decide the outcome of the water 13 rights hearing. Key issues in the water rights hearing in 14 the future could, for example, be phrased for each 15 agreement as follows, quote: 16 "Should the SWRCB amend the water rights of X, or 17 certain right holders, consistent with the provisions of X, 18 or be pertinent agreement establishing the extent of the 19 responsibility of such water right holders to help meet 20 flow agreements in the Bay-Delta Estuary," end quote. 21 That's an example. 22 Please, tell us your opinions about the 23 agreements: One, are the agreements adequate and 24 appropriate for the Board to receive evidence on them and 25 their affected water rights before considering other water CAPITOL REPORTERS (916) 923-5447 8 1 rights? 2 Two: Are the agreements inappropriate, 3 incomplete, or for other reasons should they not be 4 considered separately from other alternatives? 5 Please, tell us your specific observations 6 regarding the agreements. You should not provide an 7 exhaustive, or technical explanation. The details should 8 be held for the hearing. The Members of the Board and the 9 Board's staff may ask questions at appropriate times during 10 and after a presentation. 11 Because this is not a hearing, there will not be 12 any cross-examination, and the parties should not attempt 13 to present their detailed evidence in support of their 14 positions at this time. All the parties will have 15 opportunities to present their evidence and cross-examine 16 opposing witnesses during the water rights hearing planned 17 for July and August. 18 The Board will release a revised Notice of Public 19 Hearing after this workshop is concluded. The notice will 20 set the schedule and organization for the water rights 21 hearing, which we expect to commence in July and continue 22 through August as I mentioned a moment ago. 23 The Notice will include an issue regarding the 24 extension, or replacement of order WR 95-6. We are 25 committed to adopt a water right decision before December CAPITOL REPORTERS (916) 923-5447 9 1 31st, 1998, addressing an extension or replacement of order 2 WR 95-6. We will decide later whether that decision also 3 will address -- whether that decision also will address 4 other issues that will be listed in the upcoming hearing 5 notice. Any issues that we do not address, any decision to 6 be adopted by December 31st will be addressed in a 7 subsequent order or orders. 8 Now, with regard to the conduct of the workshop: 9 We will begin with a brief presentation from our staff, if 10 they so desire to do so. Second, we will then hear a 11 presentation of each agreement by the negotiating group, or 12 representatives of the agreements. The order that we will 13 follow in the presentation of the agreements is: 14 The Vernalis Adaptive Management Plan, the VAMP 15 first; second, the Mokelumne River Agreement; third, the 16 Yuba River Agreement; fourth, the Suisun Marsh Preservation 17 Agreement; and fifth and lastly, presentations or comments 18 on any other agreements near completion, or still being 19 negotiated. We want to provide that option as well. 20 After each presentation of each agreement, we will 21 go through all the cards and allow all other parties who 22 wish to to comment on each agreement. Again, we will go 23 through all the cards after each agreement presentation. 24 At the conclusion of all agreement presentations 25 and the related comments from the other parties, we will CAPITOL REPORTERS (916) 923-5447 10 1 allow all parties to make closing statements, if they so 2 desire. We would like to keep each agreement presentation 3 to about one hour, that's not the comments from the other 4 parties. That's just the agreement presentations. We 5 would like to keep those to about an hour. However, we 6 will allow more time if necessary. 7 Our main purpose, after all, is to -- to grant -- 8 I want you all to see that this is the portion that I wrote 9 myself and it's by hand. The rest is in typing. I can't 10 read my own handwriting. In fact, I'm the only Board 11 Member who can read it once in a while. Our main purpose 12 after all, is to grant enough time to understand the 13 status, content, and support of each agreement and to hear 14 recommendations on the structure of the upcoming water 15 rights hearing. 16 I might add at this point that we already have one 17 request from one of the presentation groups. Those that 18 will be presenting the VAMP have asked for an extra hour. 19 We are inclined to allow them to do that, as we are 20 inclined to allow any other presenter more time if he feels 21 that they need it. Because, again, our purpose here is 22 disclosure and understanding. 23 In the interest of time, however, we ask that 24 parties avoid repeating details already presented by other 25 parties whenever possible and simply indicate agreement. CAPITOL REPORTERS (916) 923-5447 11 1 Alternatively, parties with the same interest are welcome 2 and encouraged to make joint presentations. We will accept 3 and we encourage written comments. At the beginning, I 4 mentioned that we do need additional copies of some of your 5 presentations. I believe our staff will let us know who 6 owes us those, if you'll bear with us. Please, provide the 7 Board and staff 20 copies of any written comments and 8 recommendations and make copies available to the other 9 parties who are here today. 10 A Court Reporter is present and will prepare a 11 transcript. To accommodate the Court Reporter all speakers 12 are requested to use the microphones as best we can. We 13 have had some difficulties in the past. We will let you 14 know -- please, let us know in the back if you're having 15 difficulty hearing anybody also. If you want a copy of the 16 transcript, you must make arrangements with the Court 17 Reporter. 18 We have quite a number of blue cards today. I'm 19 going to estimate -- I'm not sure, maybe 20 to 25, maybe 20 it's not quite that many. But we'll go through, as I said 21 earlier, the entire stack after each presentation of each 22 agreement. 23 With that, then let me turn to my fellow Board 24 Members and see if anybody has anything they'd like to add 25 at this point. Anything from the Board Members now? CAPITOL REPORTERS (916) 923-5447 12 1 I'll repeat that Mr. Stubchaer and I will be 2 serving as co-hearing officers and co-chairs today. We 3 want -- this is going to turn out to be a protracted 4 process through the summer months. We want there to be as 5 much continuity as we can possibly provide. Thank you, Mr. 6 Stubchaer, for your willingness to do that. 7 With that then, let me ask the staff if they 8 desire to make any comments at this point, or to make any 9 kind of an opening presentation before we go to the 10 presentation on the VAMP. 11 Mr. Howard? 12 MR. HOWARD: No. 13 HEARING OFFICER CAFFREY: Nothing, perhaps, that's a 14 wise choice. We will wait and see. By the way, that does 15 not mean that you forego your opportunity to ask questions 16 as we move down the line. 17 With that then I believe Mr. Allen Short is 18 representing the San Joaquin River Group. Please, feel 19 free to make your presentations either as individuals or as 20 panels, whatever is your preference. And, please, of 21 course, for the record, introduce yourselves before you 22 speak. 23 MR. SHORT: Ready? Does this work? Folks can hear 24 us in the back, I assume. 25 THE COURT REPORTER: You are? CAPITOL REPORTERS (916) 923-5447 13 1 MR. SHORT: Allen Short. 2 HEARING OFFICER CAFFREY: Are we short of chairs, 3 gentlemen? 4 MR. SHORT: That's fine. 5 HEARING OFFICER CAFFREY: Good morning, gentlemen. 6 Please, identify yourselves. 7 ---oOo--- 8 VERNALIS ADAPTIVE MANAGEMENT PLAN (VAMP) 9 ---oOo--- 10 MR. SHORT: Good morning, Chairman Caffrey, and 11 Members of the State Water Resources Control Board. I am 12 Allen Short, the general manager of the Modesto Irrigation 13 District and also the coordinator of the San Joaquin River 14 Group Authority. 15 Along with my friends here today, who will 16 introduce themselves in just a few seconds, I'm pleased to 17 explain our settlement agreement regarding flows on the San 18 Joaquin River. But first I would like to take this 19 opportunity to thank the Board for its foresight and 20 willingness to allow additional time for parties to come to 21 an agreement. 22 Sometimes, as you well know, it's just as 23 difficult to ease up on the throttle when things are moving 24 very quickly as to step on the gas. We believe that the 25 action that you took earlier this year moved a solution to CAPITOL REPORTERS (916) 923-5447 14 1 the Bay-Delta problem further along than any Board action 2 today. It has allowed the time for parties to shape their 3 own destiny and that have a stake in ensuring that it comes 4 to fruition. Your actions have also allowed the water 5 community that broader-based negotiations can work and will 6 work; and thus providing the perfect next step to the next 7 Bay-Delta process, which is Club Fed. 8 Joining me today are a number of folks. They are: 9 Tim Quinn, the Assistant General Manager of the 10 Metropolitan Water District; Dan Nelson, Executive Director 11 of San Luis and Delta Mendota Water Authority; Steve 12 Chedester, Executive Director of the San Joaquin River 13 Exchange Contractors Water Authority; Steve Richie, the 14 City and County of San Francisco Public Utilities 15 Commission; Dick Moss, Friant Water Users Authority; Rich 16 Golb the Executive Director of the Northern California 17 Water Association; and Steve Hall from ACWA. 18 At this time I'd like to turn it to Mr. Quinn 19 who's got a couple of opening remarks and then we'll follow 20 by Mr. Golb, and then we will follow back into the rest of 21 the VAMP presentation, policy statement. 22 Thank you. 23 HEARING OFFICER CAFFREY: Thank you, Mr. Short. Good 24 morning, Mr. Quinn. 25 MR. QUINN: Good morning, Mr. Chairman, Members of CAPITOL REPORTERS (916) 923-5447 15 1 the Board. Let me start by emphasizing that Metropolitan 2 strongly supports this radically different approach to 3 resolving some of these long-standing issues in the 4 Bay-Delta watershed. We have been active in the 5 development of all these negotiated solutions. Some of 6 them are further along than others, but it certainly seems 7 to us that this is the way to make some long-standing 8 sustainable process. 9 I'm reminded of a comment that Walt Pettit made to 10 me in the middle of December of 1994. We had just spent 11 three intensive weeks trying to negotiate what became the 12 Bay-Delta Accord, and Walt commented that we made more 13 progress in those three weeks than we had made in the three 14 decades previous to that on solving some of these problems. 15 I think Walt was right then, and the reason was we 16 were abandoning the old adversarial approach that had 17 always characterized these issues in the past and had 18 dropped it in favor of a cooperative approach that is going 19 to be far more successful. I recently had lunch with some 20 of the members of my Board of Directors; and they were 21 quite alarmed that we didn't have the usual army from 22 Southern California ready to go and do battle to protect 23 our water rights, to make sure that we out do others for 24 water in the Bay-Delta system. 25 And I realized that in answering that question how CAPITOL REPORTERS (916) 923-5447 16 1 radically different this time is from the first time I 2 appeared before this body in August of 1987 in Irvine, 3 California. This is a dramatically different approach. We 4 very much appreciate the Board's willingness to give us 5 some time to put it together. 6 It's not going to be perfect. We need input from 7 others, but I'm genuinely excited about the prospects of 8 success. Not the least of the reasons is how quickly this 9 approach has spread geographically. We're here to talk 10 about the San Joaquin River Agreement, which I was active 11 in negotiating. 12 We have one, the San Joaquin River for your 13 consideration. It's probably the most complicated. It's 14 the most developed of any of the agreements, but there's 15 also the Mokelumne River Agreement, that referred to, Mr. 16 Chairman, and several up in the Sacramento River that are 17 moving along rather nicely with various stages of 18 development. It is truly remarkable the array of water 19 managers that are prepared to go with this to a cooperative 20 nonconfrontational approach. And we are determined to make 21 it successful. 22 Each agreement is different in important aspects, 23 because each of the watersheds are different, but there are 24 some common threads. Each of them have been developed 25 through a cooperative approach, each of them basically make CAPITOL REPORTERS (916) 923-5447 17 1 a compromise between the positions of the various parties. 2 The export interest, generally our view was they have an 3 obligation to help meet the Water Quality Control Plan 4 requirements; and we shouldn't have to pay for it. 5 Generally, on the other side of the table, the 6 view was they have no obligation and we should be paying 7 market prices. And we've come up with a combination of 8 public and private funding sources that negotiate out a 9 middle-ground solution. You'll all recall this goes back, 10 at least, to Proposition 204, which was passed by the 11 California voters in 1996. It contains funds which we are 12 now hoping to use to implement these agreements. It is 13 planned for that particular purpose. We've been working 14 for at least four years and very much appreciate the 15 structure that you've given us so we can work these 16 solutions out. 17 Thank you very much. 18 HEARING OFFICER CAFFREY: Thank you, Mr. Quinn. 19 MR. GOLB: Mr. Chairman, and Members of the Board, 20 thank you very much for the opportunity to address you and 21 explain. Tom Clark is recovering for an illness -- 22 THE COURT REPORTER: I need your name. 23 MR. GOLB: Richard Golb -- 24 THE COURT REPORTER: Thank you. 25 MR. GOLB: -- Executive Director of the Northern CAPITOL REPORTERS (916) 923-5447 18 1 California Water Association. Sorry about that. Tom 2 Clark, General Manager of Kern County Water Agency is 3 recovering from an illness and wanted to make a statement 4 to the Board this morning. I unwittingly accepted that 5 responsibility to make that statement for Tom. Actually, 6 I'm happy to do it. And, also, we will make copies of 7 Tom's statements for you, but I would like to read that 8 into the record, Mr. Chairman, if that would be okay. 9 HEARING OFFICER CAFFREY: Please, let me also say 10 that this being a workshop, we recognize that when people 11 come up to make their presentations, they may want to put 12 some things in context, start out with general statements. 13 We are going to certainly allow that. It appears that that 14 is what you gentlemen are now doing before you get to the 15 particulars of the VAMP. 16 I think it's reasonable to allow that and we will 17 allow that not only to the other presenters, but we will 18 allow it to the commenters who come up to speak with regard 19 to each of the agreements. So I want you all to know that. 20 And why don't you proceed. Please, read your 21 statement, Mr. Golb. 22 MR. GOLB: Thank you, Mr. Caffrey. I'll be brief. 23 This is a letter submitted to the Board dated today by Tom 24 Clark to John Caffrey. 25 Dear Chairman Caffrey and Members of the Board, I CAPITOL REPORTERS (916) 923-5447 19 1 am unable to attend the workshop today; however, others 2 will provide you an in-depth report on our progress to 3 develop several agreements with Sacramento Valley water 4 right holders. This letter, which I request to become part 5 of the Board's record, is to express deep concern over the 6 contents of the Federal Club Fed Agency's 7 April 16, 1998, letter to Secretary Doug Wheeler and 8 yourselves. 9 As the Board is abundantly aware the request to 10 modify the schedule of the hearings came as a direct result 11 of in progress among the Sacramento Valley water users and 12 export water users to reach a settlement on our respective 13 contributions of water to meet the 1995 Water Quality 14 Control Plan. 15 Our request was not to delay the schedule, but to 16 modify the Notice procedure and the order in which issues 17 are heard. Scheduling of the Sacramento Valley portion of 18 the hearing late in the process will give us the 19 opportunity to the maximum extent possible to conclude 20 settlements as opposed to contesting our respective 21 obligation before the Board. 22 We believe then, as we do now, that the quickest 23 way to conclude the water right phase is by settlement 24 rather than a contested hearing. There is no question that 25 if we fail to reach settlement and a contested hearing is CAPITOL REPORTERS (916) 923-5447 20 1 held, any decision by the Board will be litigated for 2 years. Both the Sacramento Valley and export interest want 3 to avoid litigation and request the Board do everything it 4 can to facilitate settlements while moving forward with the 5 water rights phase. 6 Club Fed's April 16, 1998, letter supports the 7 process set forth above, but strongly opposes any delay 8 into 1999. Furthermore, the letter threatens that if the 9 Board does not conclude the water right phase by the close 10 of 1998, the CALFED process extension of the Accord and ESA 11 protections may all be in jeopardy. 12 Separate and apart from the scheduling issue, the 13 Club Fed letter raises an important policy concern. The 14 entire focus of the Club Fed letter is on completing the 15 water right phase and incorporating into our water right 16 permits a regulatory obligation to meet the Accord's 17 standards. Yet, nothing is said about the relationship of 18 these standards to the Club Fed process and to the 19 assurances given to the water users in the 1994 Bay-Delta 20 Accord. 21 Currently, there is a total disconnect between the 22 regulatory process to implement the Accord standards with 23 the CALFED process and the Accord assurances. Our obvious 24 concern is that through the Board's water right phase water 25 users will have a regulatory obligation to meet the Accord CAPITOL REPORTERS (916) 923-5447 21 1 standards and Club Fed will have no continuing legal 2 obligation to the CALFED process, or to the Accord 3 assurances. 4 We respectfully request that the Board consider 5 linkages between the water users' obligation to meet the 6 standard with the Club Fed's obligation to continue to 7 cooperate in the Club Fed process and arm the Accord 8 assurances. Club Fed has suggested a meeting to address 9 their concerns regarding the Board's scheduling. I suggest 10 the issues raised in this letter also be discussed at the 11 proposed meeting. Please, advise me of the Board's 12 position. Thank you for your consideration. Sincerely, 13 Tom Clark, General Manager, Kern County Water Agency. 14 On behalf of myself and Northern California Water 15 Association, Mr. Chairman, and Board, I would say two 16 general comments briefly regarding the negotiated 17 settlements, which VAMP is the first which you'll hear 18 about today. 19 First, clearly, as Tim indicated, the negotiated 20 settlements are neither an admission nor an avocation of 21 responsibility or obligation regarding water quality 22 standards in the Bay-Delta. It's simply a simple decision 23 that we came to that we believe is a preferable approach, 24 more efficient, more cost-effective to solve these 25 problems. CAPITOL REPORTERS (916) 923-5447 22 1 Secondly, I would also note that the federal 2 agencies have raised a number of principal issues that 3 they've offered and will present to the Board today 4 regarding these negotiated settlements. We certainly 5 haven't had a lot of time at this point to review them in 6 detail, there are some that we will likely disagree with; 7 some we feel are likely contrary to both the spirit of the 8 negotiations and possibly California law. But, 9 nonetheless, we will work with the agencies. Obviously 10 they will have to be a party in agreeing to the negotiated 11 settlements that we are working on. 12 So we will gladly work with them and try to 13 resolve those as soon as we can. And with that I would 14 simply support the VAMP negotiation and the presentation 15 that Allen Short will lead today and hopefully these 16 discussions will conclude quickly. 17 HEARING OFFICER CAFFREY: Thank you, Mr. Golb. 18 MR. SHORT: The final individual who will speak, at 19 least on the VAMP piece today, is Steve Hall, the Executive 20 Director of AWCA, and then we will move through and present 21 to you the policy statement on the VAMP. 22 HEARING OFFICER CAFFREY: While Mr. Hall is 23 approaching the podium, let me point out that there are a 24 number of seats that may not be obvious to those of you 25 standing in the back, if you wish to sit down, please, do CAPITOL REPORTERS (916) 923-5447 23 1 so. Like I say, there are a number of seats disbursed 2 throughout the audience. 3 Good morning, Mr. Hall, and welcome to you, sir. 4 MR. HALL: Good morning, Mr. Chairman, and Members of 5 the Board. Let me say that along with Mr. Golb, 6 Mr. Clark has enlisted my organization. We were in charge 7 of providing copies for you. We diligently provided them 8 at the back, they were quickly taken. So I think we now 9 provided you with some more. So you should be able to see 10 Mr. Clark's statement -- 11 HEARING OFFICER CAFFREY: As you speak. 12 MR. HALL: -- as well as our own statement. Let me 13 begin by echoing what Dr. Quinn said earlier about how 14 different this process is, and I should say, bold, and how 15 much better we think it is already working and will work in 16 the future. 17 Forgive this awkward paraphrase, but I'm reminded 18 of Winston Churchill's comment about democracy, this 19 process is a lot like that. It is frustrating, agonizingly 20 slow, far from perfect, and better than all the 21 alternatives, because we believe it will get us where all 22 of the parties want to be more quickly, more efficiently, 23 and I think more justly than the alternative. 24 In that to answer your question directly, 25 Mr. Chairman: Is the VAMP adequate and appropriate? Yes, CAPITOL REPORTERS (916) 923-5447 24 1 we believe that it is. In fact, we believe it's not only 2 adequate and appropriate, we believe it's a good model for 3 the other agreements that we hope will follow, because it 4 embodies all of the benefits to the environment, to the 5 water user community, and to California at-large, that we 6 hope all of the other agreements will embody. And although 7 it has taken a while, we believe that it is a much speedier 8 process than anything else that we could do. Certainly, 9 more so than the adversarial processes that we've been 10 involved in before. 11 So we support VAMP. We support the schedule, 12 Mr. Chairman, that you outlined for the hearing in your 13 March 19th letter, with this one small change. We would 14 recommend respectfully that you may consider an additional 15 workshop, perhaps in June, to again check on the progress 16 before you go into the full hearing process. That, of 17 course, is for you to consider. And you should probably 18 consider it only after this workshop is over, the dust is 19 settled, but with that small change we support the process 20 the Board has outlined and we support the VAMP agreement. 21 Thank you. 22 HEARING OFFICER CAFFREY: Thank you very much, 23 Mr. Hall. 24 MR. SHORT: Thank you. As you can see and with 25 others that I have not introduced this morning who have CAPITOL REPORTERS (916) 923-5447 25 1 been a part of the negotiations and discusses regarding the 2 San Joaquin settlement agreement, these gentlemen 3 representing the respective agencies have asked me to 4 inform the Board about a truly historic agreement: The San 5 Joaquin River Agreement, which incorporates and implements 6 the Vernalis Adaptive Management Plan. 7 You have in front of you a letter of support for 8 the San Joaquin River Agreement. The Vernalis Adaptive 9 Management Plan referred to and -- in the agreement is 10 Appendix A. And the Appendix B to the agreement is the 11 implementation plan which is the San Joaquin River 12 Agreement's operation control document. The signatories to 13 the letter of support for this agreement have authorized 14 the following presentation to inform the Board and the 15 public about the important agreement: 16 First, we'll have Mr. Robbins, Mr. Shultz, and 17 Mr. Brandt outline the agreement and provide the Board and 18 the public some details and highlights. Secondly, 19 Dr. Herbold, Dr. Hansen, and Mr. Kjelson will explain 20 Appendix A and why we need the test and how the test will 21 be done. Finally, Mr. Steiner, Mr. VanCamp, and 22 Mr. Winkler will explain Appendix B and give a brief 23 overview of the hydrology. 24 I would like to point out that the representatives 25 of the federal agencies that have signed the letter of CAPITOL REPORTERS (916) 923-5447 26 1 support will be making statements regarding the San Joaquin 2 River Agreement after our presentation. We have 3 coordinated the presentation to highlight areas of interest 4 to each of our respective agencies. In addition to our 5 presentation on the San Joaquin River Agreement, we will 6 make recommendations regarding how we believe the Board 7 should proceed through the water right hearing. The 8 presentation will be made by Tim O'Laughlin and myself. 9 HEARING OFFICER CAFFREY: Excuse me for interrupting 10 you, Mr. Short, but I want to take the opportunity of your 11 statement as a segue to remind the audience that when you 12 do come up to comment, whether you're presenting an 13 agreement or making a comment about that agreement, that is 14 the appropriate time to let us know what your feelings are 15 and what your recommendations are with regard to the 16 structure of the water rights process. 17 So that is part -- that is one of the two noticed 18 issues for today. So I don't want that to fall by the 19 wayside as we discuss the agreements. So, thank you for 20 reminding me, Mr. Short, and including that in your 21 presentation. Please, proceed. 22 MR. SHORT: Thank you, Mr. Chairman. I will begin by 23 explaining where we are today and how we reached this 24 point. Approximately three-and-a-half years ago Governor 25 Wilson announced the water policy to the California water CAPITOL REPORTERS (916) 923-5447 27 1 community. The message was clear and strong. It was 2 consensus, we do it together and not at the expense of any 3 particular group. Shortly on the heels of this water 4 policy statement the Bay-Delta Accord was signed, several 5 months later the Board adopted the 1995 Water Quality 6 Control Plan for the Bay-Delta. 7 In response to the 1995 Water Quality Control 8 Plan, the San Joaquin River Tributaries Associations, known 9 at that time as the SJTA, was formed by the Merced, 10 Oakdale, South San Joaquin, Turlock, Modesto Irrigation 11 Districts. The purpose of SJTA was to provide a 12 comprehensive and coherent response to the flow standards 13 and objectives adopted by the Board for Vernalis. 14 The members of the SJTA were not part of the 15 Bay-Delta Accord negotiations. Our review of the Board's 16 standards revealed serious questions regarding the science 17 used to support the proposed and rationale behind the flow 18 standards and objectives for Vernalis. The SJTA sued the 19 State Water Resources Control Board over the adoption of 20 the standards. In 1995 the SJTA expanded its membership to 21 include the San Joaquin River Exchange Contractors and the 22 Friant Water Users Authority and became known as the San 23 Joaquin River Group Authority. 24 The SJRGA along with the City and County of San 25 Francisco began to meet with certain SWP and CVP export CAPITOL REPORTERS (916) 923-5447 28 1 water contractors to discuss how the Vernalis flow 2 standards and objectives would be implemented. These 3 discussions commenced at the direction of the Board, and 4 when the Board said consensus-based solutions would be 5 helpful, that is what we undertook. 6 Those discussions took almost nine months and 7 culminated in a Letter of Intent, or the LOI. The LOI is 8 the basis for fall alternative number seven in the Board's 9 draft EIR and has since been superseded by the San Joaquin 10 River Agreement and the San Joaquin River Agreement Study 11 Plan. Subsequently, the Board and SJTA reached a 12 settlement to dismiss the lawsuit. 13 A key settlement component was the Board's 14 commitment to hold a water quality hearing to review the 15 Vernalis flow standards and objectives. After the LOI was 16 distributed in 1996, federal and state agencies, the 17 environmental organizations expressed concern regarding the 18 LOI. These interests did not believe the LOI went far 19 enough to implement the standards and objectives for 20 Vernalis. 21 At this critical juncture Dr. Herbold and 22 Dr. Hansen made a proposal that was the basis for the 23 Vernalis Adaptive Management Plan. The proposal recognizes 24 that there was no data to support flow standards other than 25 the lowest levels and when uncontrolled flood flows CAPITOL REPORTERS (916) 923-5447 29 1 occurred. The solution was to propose a test to study the 2 relationship between flows at Vernalis, export pumping, and 3 the survival of salmon smolt. This met the need of the 4 SJRGA to gather and have adequate information to support a 5 flow standard. The test was designed to protect the 6 fishery resources in a manner as effective as the 1995 7 Water Control Quality Plan standards for Vernalis. Thus, 8 the federal and state agencies' concerns regarding 9 equivalent protection for fish were met. 10 The San Joaquin River Agreement as presented 11 proposed it will gather the information necessary to make 12 an informed and rational decision on long-term flow 13 standards and objectives for Vernalis insofar as flow 14 ratios and the effectiveness of the Old River Barrier are 15 concerned. The San Joaquin River Agreement is now before 16 this Board for review and consideration. From a policy 17 viewpoint we believe the San Joaquin River Agreement makes 18 sense for the following reasons: 19 First, broad base of support. The LOI was an 20 important first step towards getting consensus on -- on 21 measures to protect the fishery of the San Joaquin River. 22 It was supported by major water right holders on the San 23 Joaquin River and major exporters from the Delta. These 24 agencies who have signed the LOI then began the process of 25 reaching out to other groups. CAPITOL REPORTERS (916) 923-5447 30 1 Federal and state agencies, environmental 2 organizations began to comment on the LOI. Certain 3 requirements for these groups to agree to a broad-base 4 solution were not present in the LOI. The SJRG, Export 5 Contractors, EPA, USBR, USFWS, DWR, California Fish and 6 Game, NHI, and Bay Institute then entered into regularly 7 scheduled discussions on how to gain consensus. 8 The San Joaquin River Agreement negotiations took 9 approximately 18 months to complete and entailed countless 10 meetings, studies, hydrological modeling and drafting of 11 the biological test. The SJRG has spent more than two 12 million dollars trying to gain consensus through the LOI 13 and the San Joaquin River Agreement. 14 We believe that we have accomplished what Governor 15 Wilson urged us to do back in December of 1994. We have 16 engaged agencies, entities, and people and dialogue to 17 resolve the San Joaquin River issues. We have -- we have 18 that here today. This is an historic agreement between 19 urban and agricultural interests. It is a historic 20 agreement between interested agricultural and environmental 21 communities. 22 EPA and its biologist Dr. Bruce Herbold were 23 instrumental in putting the San Joaquin River Agreement on 24 track, to keep the parties at the table. Mr. Patrick 25 Wright from EPA worked diligently to keep the parties at CAPITOL REPORTERS (916) 923-5447 31 1 the table. U.S. Fish and Wildlife Service, California 2 Department of Fish and Game lent their staffs and expertise 3 in designing the San Joaquin River Agreement. U.S. Fish 4 and Wildlife Service also worked to put the San Joaquin 5 River Agreement into the AFRP, CVPIA, 340662. 6 Natural Heritage Institute and the San Francisco 7 Bay Institute were also participants from nearly the 8 beginning of the San Joaquin River Agreement. Through them 9 many other environmental organizations, including the 10 Environmental Defense Foundation and the Natural Resource 11 Defense Council raised issues that were considered in the 12 development of the final version of the San Joaquin River 13 Agreement. 14 Those of us who negotiated the San Joaquin River 15 Agreement will remember a final meeting late into the night 16 last February attended by representatives of NRDC and Save 17 the Bay as well as NHI and Bay Institute at which each 18 issue raised by those organizations was discussed and 19 addressed. No discussion on any substantive issue raised 20 at that meeting was concluded until there was at least no 21 objection to the proposed resolution. 22 These organizations have chosen, for their own 23 reasons, not to actually sign the San Joaquin River 24 Agreement, but scores of changes were made to the agreement 25 and its attachments at the insistence and response to the CAPITOL REPORTERS (916) 923-5447 32 1 environmental concerns which were raised. 2 One of the main concerns of the Bay Institute, 3 NHI, and other environmental organizations is the funding 4 source for the San Joaquin River Agreement. From its 5 inception the agreement had the Friant surcharge as the 6 funding source. The reason for that -- the reason for this 7 is the Friant surcharge was to be used to benefit the San 8 Joaquin River. This agreement was benefiting the river 9 and; therefore, the Friant surcharge should be used. 10 Environmental groups wanted a commitment to seek 11 funds other than CVPIA restoration funds. The agreement 12 states that this was -- this was actually accomplished in 13 the negotiation process when DWR committed one million 14 dollars a year towards the agreement. We are committed to 15 seeking alternative sources and will continue to work with 16 environmental groups to obtain other funding, but we do not 17 believe that this should be a reason to stop the San 18 Joaquin River Agreement from moving forward. 19 The consensus represented by the San Joaquin River 20 Agreement is of much broader benefit than just to the San 21 Joaquin River. All of the entities represented in the San 22 Joaquin River Agreement negotiations will also need to work 23 together if there's to be a successful resolution of 24 CALFED. The cooperative problem solving relationships 25 developed among the San Joaquin River Agreement CAPITOL REPORTERS (916) 923-5447 33 1 participants will aid in that endeavor. The alternative to 2 the San Joaquin River Agreement nonproductive disputes over 3 the technical support for and the wisdom of the current is 4 San Joaquin River requirements and the responsibilities to 5 meet them will quickly end those relationships and divert 6 the resources necessary to successfully conclude the CALFED 7 process and the implementation of the real San Joaquin 8 River protections. 9 If approved by the Board, the San Joaquin River 10 Agreement, unlike the results of content -- of a contention 11 water rights proceedings will be implemented immediately. 12 All the parties to those proceedings know that a contention 13 water rights proceeding resolves nothing. It only results 14 in polarization, lawsuits, rhetoric, uncertainty, and 15 maintaining the status quo. 16 If we are going to actually do something for the 17 San Joaquin River, the Bay-Delta Estuary we have the 18 opportunity to do so and we need to act now. The broad 19 base of support has given us the ability to move forward. 20 The operations agreement, Appendix B to the framework 21 agreement, this sets forth how flows from the San Joaquin 22 River basin will be coordinated to make water available in 23 an amount required for the test. 24 The Board staff has long recognized that even if 25 the Board issued an order in a water rights proceeding, it CAPITOL REPORTERS (916) 923-5447 34 1 would be years before the project operations could be 2 coordinated to meet the order. With immediately 3 implementing the order of an approved San Joaquin River 4 Agreement the benefits are as follows: 5 One, the environment immediately benefits from 6 this agreement. The biologists will tell you later that 7 the plan provides a level of protection at least equivalent 8 to that which would have been realized by the 1995 Water 9 Quality Control Plan. U.S. Fish and Wildlife Service, EPA, 10 California Department of Fish and Game have all agreed that 11 the San Joaquin River Agreement is the cornerstone to a 12 long-term solution on the San Joaquin River Bay-Delta. 13 Infrastructure: Two, the money provided to make the 14 water available to meet the prescribed San Joaquin River 15 Agreement flows will go to infrastructure improvements 16 within the San Joaquin River. The types of improvements 17 include: Canal-line use, conjunctive use, telemetry and 18 monitoring. The money will provide a steady revenue stream 19 to fund some of the more costly of these improvements. 20 Three, certainty. With this agreement comes a 21 certainty on the San Joaquin River that we have not seen in 22 quite some time. The value of this certainty cannot be 23 overlooked. It allows entities such as the Merced 24 Irrigation District to proceed forward on a major 25 conjunctive use program which is planned to improve CAPITOL REPORTERS (916) 923-5447 35 1 groundwater storage and conservation. It allows the 2 Oakdale Irrigation District and the South San Joaquin 3 Irrigation District the ability to transport water to 4 Eastern San Joaquin County, which is a severely overtrapped 5 basin. 6 Four, information. Finally, this agreement and 7 the test will be done over the next 12 years. We believe 8 it will give the Board and others information necessary to 9 make reasonable decisions and judgments regarding the 10 benefits of the Old River Barrier and the maintenance of 11 flows for the San Joaquin River and diversions for the 12 export pumps. 13 The work being done by the SJRGA, the work by the 14 Regional Water Quality Control Board on discharge 15 requirements for the San Joaquin River, the SJRMP Program, 16 AFRP, CVPIA 3406(B)(2) Category 3, CALFED, and what the 17 Merced Irrigation District is doing on the Merced River, 18 the Modesto Irrigation District, Turlock Irrigation 19 District, and the City and County of San Francisco are 20 doing on the Tuolomne River and the Oakdale Irrigation 21 District and the South San Joaquin Irrigation District in 22 cooperation with USBR on the Stanislaus River will increase 23 our understanding of the San Joaquin River and its 24 tributaries. In addition, these programs will provide 25 on-the-ground and river benefits during the next 12 years. CAPITOL REPORTERS (916) 923-5447 36 1 The San Joaquin River Agreement cannot answer all 2 of the questions concerning facts which affect the fishery 3 resources on the San Joaquin River Basin. We agree with 4 the concerns we have heard from others that other factors 5 must still be studied. One of the challenges we must all 6 address together is: How do we address these other 7 factors? 8 In conclusion I would like to take the 9 opportunity, again, to thank the Board and you, 10 Mr. Chairman. And I would also like to take the 11 opportunity to thank all of those who participated in the 12 negotiations; as Mr. Hall so adequately characterized it, 13 it was an incremental process and it was frustrating. And 14 my good friend here, Mr. Quinn, has taught me a lot about 15 process. And I can certainly thank him for that. 16 It's not always easy, but we have arrived at a 17 true -- at a plan that truly works for all of California 18 and we now have the opportunity to begin to control 19 California's destiny. 20 With that, Mr. Chairman, I will turn it over to 21 Mr. Robbins who will begin to walk through the proper 22 attachments. 23 HEARING OFFICER CAFFREY: Thank you, Mr. Short. Good 24 morning, Mr. Robbins. Welcome. 25 MR. ROBBINS: Good morning. My name is Ken Robbins. CAPITOL REPORTERS (916) 923-5447 37 1 I am General Counsel to the Merced Irrigation District and 2 appearing this morning on behalf of the San Joaquin River 3 Group Authority. With me this morning are Mr. Cliff Schulz 4 and Mr. Brandt, who will be participating in our 5 presentation. 6 Our job this morning is to very briefly describe 7 for you the actual San Joaquin River Agreement. And this 8 poses an opportunity for us to clarify some nomenclature. 9 The agreement that we are talking about that's been 10 generically referred to as the "VAMP," is actually the San 11 Joaquin River Agreement. The "VAMP," or the Vernalis 12 Adaptive Management Plan is Appendix A, which is the 13 biological studies parameters that are to be done relative 14 to the San Joaquin River Agreement. And, of course, 15 Appendix B has to do with the coordination of the hydrology 16 of the system. Although, really, generically in the public 17 this whole matter has been referred to as the "VAMP." 18 Well, the actual "VAMP" itself is the study. 19 Our purpose this morning is to try to describe for 20 you the foundations upon which the agreement is based. 21 Most of the deal points, I think, are self-explanatory. We 22 have previously provided the Board with 20 copies of the 23 agreement along with the appendices. And we've taken the 24 liberty of mailing to the parties of interest in this 25 matter copies of the agreement as well. CAPITOL REPORTERS (916) 923-5447 38 1 We came to the conclusion along with many others, 2 as you heard this morning, that a consensus agreement, 3 trying to reach a solution relative to implementation of 4 the Board's 1995 Water Quality Order would be easier and 5 certainly less expensive and probably quicker than 6 attempting to do things the old way. But as you will hear 7 later in our suggestions about process, what we have is a 8 cease fire. None of us have disarmed ourselves as it were. 9 And so we're excited to be able to present to you 10 this morning our agreement relative to the San Joaquin 11 River, but we do need to get the thing implemented. And 12 later this morning we'll be talking about our views about 13 how to best go about doing that. 14 The San Joaquin River Agreement is based upon six 15 major principles, pillars if you will, relative to its 16 implementation. The first has to do with the Old River 17 Barrier. As you know and is part of your plan, the Old 18 River Barrier is the best hope that we can see for ensuring 19 that out migrating salmon smolt traversing the Delta in 20 April and May are not diverted, if you will, into the 21 interior Delta; but rather move along the main corridor of 22 the San Joaquin River. 23 To that effect, parties have agreed that the Old 24 River Barrier is essential, that it will be placed in a 25 permanent structure, obviously, that's being undertaken by CAPITOL REPORTERS (916) 923-5447 39 1 DWR and the Bureau in another proceeding. The barrier 2 presents some of its own issues, which will be mitigated by 3 a program and, obviously, we need to work through that 4 whole process. But the barrier is one of keystones, if you 5 will, for the San Joaquin River Agreement. 6 Additionally, as -- and probably most importantly, 7 what we'll concentrate on most this morning are the flow 8 export relationships. We have assumed that certain flow 9 requirements is necessary. The engineers and hydrologists 10 that will be testifying relative to Appendix B will 11 describe that in more detail for you. But, essentially, 12 what we've arrived at is a series of flow targets triggered 13 by various year types with certain formulas for increasing 14 the flows in some years, and for decreasing flows in other 15 years. And I will leave it to that technical team to 16 describe that formula system for you. 17 In conjunction with the flows are also export 18 restrictions. They are designed, if you will, around the 19 VAMP study, or around the biological studies that will be 20 conducted over the course of the 12 years that the San 21 Joaquin River Agreement is intended to be in effect. 22 In addition to flow export and Old River Barrier, 23 the third major premise of the San Joaquin River Agreement 24 is the operations of New Melones. It's fairly obvious that 25 none of us on the San Joaquin River could really gauge our CAPITOL REPORTERS (916) 923-5447 40 1 responsibilities, or our liabilities, if you will, or 2 exposure to risks relative to flows at Vernalis, unless we 3 had some baseline from which to operate. 4 A major part of that baseline is, obviously, the 5 operations of New Melones. And what we've assumed in the 6 agreement is that the interim operating plan at New Melones 7 will be how the facility is operated. Now, that's not to 8 mean that the Bureau is tied to the interim plan. But our 9 obligations, if you will, on the San Joaquin to provide 10 flow will be based upon the assumption the interim plan is 11 how New Melones is operated. 12 If New Melones puts more water into the river, for 13 instance, our obligations will not be decreased because we 14 will be operating to their interim plan. On the other 15 hand, if less water is placed into the river, our 16 obligations will now be increased by virtue of that. Our 17 consensus, however, amongst the group is that we will hit 18 these target flows in years by trying to coordinate, if you 19 will, the operations of New Melones, New Don Pedro, and New 20 Exchequer, three major tributaries to one of California's 21 major rivers trying to provide a flow at a given point on a 22 given date at a given place. That will not be easy, but we 23 think we are -- will be able to achieve that. 24 A fourth major component of our agreement is 25 payment. The Bureau of Reclamation and DWR have agreed to CAPITOL REPORTERS (916) 923-5447 41 1 provide four million dollars to the River Group Authority 2 for its operations under the San Joaquin River Agreement. 3 Those funds will be substantially committed to improvements 4 in the system that will enable us to make the water 5 available. 6 The division of that payment at this point is 7 agreed to be three million dollars from the Bureau, and a 8 million dollars from DWR. The specifics about that and, 9 certainly, DWR's support for that are to be completed. 10 We are all committed to conducting the fifth of 11 the major tenant of the San Joaquin River Agreement, which 12 is its whole purpose. And that is, essentially, to study 13 the relationship between flows and exports on the survival 14 of out-migrating fall-run chinook salmon. To that effect 15 we have agreed to jointly fund those studies over a period 16 of 12 years. Those studies will be more -- described in 17 more detail by the biology panel that will be appearing 18 relative to Appendix A, or the VAMP, if you will. 19 That study is intended to take 12 years. There are 20 some provisions in the agreement for extending it. As an 21 example, if there is a natural disaster that occurs in the 22 system and we're unable to meet one of the data points then 23 there's a provision for extending it further without 24 additional payment. 25 This morning I think it's appropriate at this CAPITOL REPORTERS (916) 923-5447 42 1 point then to talk a little bit about what the export 2 restrictions mean and some of the issues that arise 3 relative to that. And Mr. Cliff Schulz will address those 4 points. 5 MEMBER FORSTER: Where's the six? 6 MEMBER BROWN: Yeah, what's number six? 7 MR. ROBBINS: Six is assurances. And -- and we'll 8 get to that in a moment. 9 MEMBER BROWN: Mr. Chairman, that sounds like a 10 setup. 11 HEARING OFFICER CAFFREY: Thank you for your 12 diligence, Mr. Brown. He's up here taking notes. Very 13 good, sir. Thank you. We'll keep you all honest as best 14 we can. 15 Good morning, Mr. Schulz. 16 MR. SCHULZ: I'm Cliff Schulz for the record, 17 attorney for the Kern County Water Agency. Today I'm not 18 just speaking for Kern, but I'm trying to make a consensus 19 statement from the exporters who were involved in the VAMP 20 negotiations, for what seems to have been half of our 21 lives. 22 I am going to try to limit discussions today to the 23 operational restraints and export target portions of VAMP, 24 although in talking about that I will sneak into dispute 25 resolutions that you cannot help but do it. Section 6.4 of CAPITOL REPORTERS (916) 923-5447 43 1 the agreement is where I'm going to be starting. And that 2 is a section that contains the ratio of target flows at 3 Vernalis and exports that will occur during the term of the 4 VAMP. 5 And as one can see from looking at those 6 provisions that we are trying to get a series of data 7 points to find out what is going on, at what -- what 8 control: Is it the amount of export, or is it the amount 9 of flow? So that we have export ranges of 1500, 2250, and 10 3000 with flows that range from 2 to 7,000. Just sort of 11 aside you may get a little bit of this later, we stop at 12 7,000 in the VAMP, because at 7,000 that's about the 13 highest flow that you can have in the older barrier flows. 14 So 1998 is a non-VAMP year, technically, because we 15 have over 7,000 clearly coming out of Vernalis right now. 16 I think we're up around 20. And, therefore, there is no 17 barrier and certain aspects of VAMP therefore aren't being 18 applied this year. And that's -- that's dealt with in 19 Section 6.5 of the agreement as to what we do in the plus- 20 7,000 csf years. And we thought about that in the Delta 21 within the agreement. 22 But up to seven we have these export limits. And 23 the exporters were, obviously, most concerned about the 24 water supply impacts of those export limits during the -- 25 during the study, because if you just do rough calculations CAPITOL REPORTERS (916) 923-5447 44 1 you can see that the difference between the export 2 limitations that are in VAMP and the export limitations 3 that are in the Accord, in one month in some years can 4 exceed a couple 100,000 acres of water of export pumping. 5 So it was a major -- major issue for the exporters as we 6 were going through the negotiation process. I'm not saying 7 that 200,000 acre feet is lost, necessarily, in the 8 projects. What I'm saying is is that is the amount of 9 export pumping that's still pumping over and above the 10 Accord as a result of the VAMP agreement. Sometimes 11 hydrologic conditions take care of that; sometimes they 12 don't. 13 We've done enumerable operation studies to try to 14 figure those kinds of things out. So that -- with that in 15 place, we had a great deal of negotiations over Section 6.6 16 and 6.7 of the VAMP, which call for a procedure by which we 17 have an operations plan that is developed early each year 18 to try to establish what data point we're going to meet for 19 that year; how much water is available; what condition the 20 reservoir is; you name it and we'll try and figure it out, 21 and also how do we make up the supplies that would be 22 foregone during the time period through the export 23 production. 24 And Section 6.6 sets forth a time schedule. And 25 finally it says at the very end, "If the matter remains CAPITOL REPORTERS (916) 923-5447 45 1 unresolved, the provision of paragraph 13.4 will be 2 invoked," and that's a mediation and determination process 3 that I'll talk about in just a minute. 4 And it also says that if we don't have agreement 5 on an operations plan for a year, then in that particular 6 year the export limits will not be in play, but the 7 Vernalis flows will still be provided. And we'll get as 8 much of the data point as we can under the circumstances. 9 You can't -- as I say, you can't do anything with 10 6.6 and 6.7 unless you look at this Section 13.4, which is 11 part of the dispute resolution process. And it calls for a 12 mediation process if the parties can't agree as to what the 13 operational plan would be. And there's another aspect of 14 this, which involves the Board, an important -- an 15 important point that involves the Board. 16 In Section 7.0 of VAMP there's a statement that -- 17 it's a list of things that we want the Board to do in order 18 to have VAMP implemented. And one of them is committing to 19 expedited issuance of notice and timely completion of 20 appropriate hearings. If objection to the operations plan 21 described in Section 6.6 are unresolved by April 10th, and 22 the reason we put that in is everybody around the table 23 wanted to make sure that we always had a fall-back 24 position, or that we had a procedure whereby the Board 25 could take jurisdiction if it needed to rapidly if for some CAPITOL REPORTERS (916) 923-5447 46 1 reason there were problems with VAMP. 2 And if you notice the April 10th, it's the date 3 upon which before we even start our mediation process under 4 the dispute resolution part of this contract, which means 5 that we would be asking you, in effect, to give notice that 6 unless we're successful in that mediation that you're going 7 to give a hearing, that you're going to be giving your 8 notice at the same time we're mediating, you're going to be 9 going parallel, and by God we better be successful or 10 you're going to take over. 11 And we tried to put as much in here to make the 12 process successful. This is a difficult area. It is wound 13 up in B2. These VAMP flows and export reductions are part 14 of the B2; they are part of the AFRP actions. And we know 15 that the make up water issues are going to be difficult 16 ones that are going to face us on an annual basis. But we 17 tried to write into VAMP things that will really motivate 18 the parties to reach agreement through the process of 19 developing the operations plan each year so that we cannot 20 end up with a situation where the Board has to regain 21 jurisdiction during the process. Nobody is going to want 22 to be the one that pulls the trigger and send this puppy 23 back to the Board. 24 So we think we drafted a good agreement that gives 25 us the best chance as possible of working out these B2 ARFP CAPITOL REPORTERS (916) 923-5447 47 1 and make up water issues. And, quite frankly, we're very 2 delighted we have a nice wet year this year, because it 3 gives us a little more time to get those worked out as part 4 of the as AFRP negotiation. 5 CO-HEARING OFFICER STUBCHAER: Question, 6 Mr. Chairman? 7 HEARING OFFICER CAFFREY: Yes, Mr. Stubchaer. 8 CO-HEARING OFFICER STUBCHAER: On page eight, Section 9 6 that you referred to, it's export limits versus Vernalis 10 target flows. Why are there two Xs under the 7,000 csf 11 column? 12 MR. SCHULZ: We're trying to get two data points for 13 the high-flow low export and the high-flow high export. 14 CO-HEARING OFFICER STUBCHAER: Okay. Thank you. 15 HEARING OFFICER CAFFREY: Yes, Mr. Del Piero. 16 MEMBER DEL PIERO: I've been trying to figure out 17 what the -- what the penalty is in the event there isn't an 18 agreement by April 10th. 19 MR. SCHULZ: What the penalty is? 20 MEMBER DEL PIERO: Yes. 21 MR. SCHULZ: The penalty is significant risk that 22 VAMP will be terminated and that we will end up going back 23 into an almost a -- under your stipulation with the San 24 Joaquin folks, a hearing before this Board on the Water 25 Quality Control Plan standards. CAPITOL REPORTERS (916) 923-5447 48 1 MEMBER DEL PIERO: What is the penalty? I mean 2 without any database, how's this Board going to hold that 3 hearing? 4 MR. SCHULZ: The same way it would have held a 5 hearing without VAMP. In other words, the parties would 6 have had to come in with all of their scientists and given 7 their best information which -- that is our -- that is -- 8 MEMBER DEL PIERO: That hearing was with a settlement 9 agreement was at the request of the San Joaquin water right 10 holders? 11 MR. SCHULZ: Correct. 12 MEMBER DEL PIERO: So let me get back to the same 13 question I asked: Tell me what the penalty is to folks if 14 they choose not to reach an agreement by April 10th. 15 MR. SCHULZ: The penalty is -- 16 MEMBER DEL PIERO: The Board is left without any 17 environmental documentation upon which to hold a hearing 18 that everybody is going to then blame us for not holding a 19 hearing, because within the context of this process, no 20 basis upon which to render a decision. 21 MR. SCHULZ: Mr. Del Piero, if there was a -- the 6 22 point -- or the Section 7 hearing was noticed by the Board, 23 in effect they would be doing at that time what they 24 otherwise would be doing now, in other words, receiving 25 evidence. And, you know, I've dealt with the San Joaquin CAPITOL REPORTERS (916) 923-5447 49 1 folks for quite a bit and know what their scientists are 2 doing and the studies that they've done, and knew what type 3 of testimony they were going to put on. And I also knew 4 what type of testimony or tentative evidence we were going 5 to have to put on with respect to flow needs. 6 And we would be -- I guess the penalty is that 7 none of us truly in today's world want to be in that 8 adversarial position. And nobody wants to be the one that 9 creates that. We are as I hope the policy proposed has 10 made clear, in trying to set up a new dynamic here where we 11 don't go before the Board with things that are unknown and 12 unknowable. It is more of a political-policy doomsday-type 13 of weapon position that we're in. 14 UNIDENTIFIED MAN: If I might also -- 15 MEMBER DEL PIERO: Excuse me. No, go ahead, because 16 I guess my perception of the situation after having looked 17 at this is that may be -- is that may be the way some 18 people perceive it. The flip side is terms of being in a 19 regulatory board, it leaves us in a completely untenable 20 situation. We've got no database upon which to hold a 21 hearing that we're being expected to hold; and on top of 22 that because of the April 10th date, we've lost a year 23 without any export limits. 24 MR. SCHULZ: There are -- there are export limits 25 this year. They have been worked out under -- CAPITOL REPORTERS (916) 923-5447 50 1 MEMBER DEL PIERO: I don't mean this year, but in 2 terms of failure to agree. 3 MR. SCHULZ: Yes. There is definitely export limits. 4 There are the export limits that are in the Water Quality 5 Control Plan. There are the export limits to the extent 6 that there is language in the biological opinion with 7 respect to exports during the Vernalis post-fall period. 8 So, yes, there are existing export limits. They are 9 different from what is in VAMP. 10 MEMBER DEL PIERO: Yeah, I know. That's why I -- 11 MR. SCHULZ: But -- but the only way you're going to 12 get the export limits that are in VAMP is by doing VAMP. 13 Otherwise, we are going to spend the next year, plus year 14 in hearings before this Board trying to figure out once 15 again what they would be. 16 We feel the way we crafted VAMP that there's a 17 90-percent change that we're never going to have to hold 18 that hearing. And as far as VAMP is concerned what the 19 export limits are, you will hear from people today that we 20 feel that what we're doing is the best of all possible 21 worlds. It gives us the ability to gain data on what is 22 really needed for the fish; and at the same time it gives 23 us roughly equivalent protection to what's in the basin 24 plan standards, because the flows that the pump is going to 25 be pumping is less and we come out the same CAPITOL REPORTERS (916) 923-5447 51 1 protection-wise. And there are people that will talk about 2 that today. 3 MEMBER DEL PIERO: In the event -- in the event that 4 the failure to reach agreement by April 10th -- 5 MR. SCHULZ: Uh-huh. 6 MEMBER DEL PIERO: -- and given your comments about 7 everybody wants the Board to hold a hearing immediately in 8 order to render a decision, does that mean all the parties 9 who are signatories to VAMP are willing to agree that the 10 Board could declare an emergency pursuant to CEQA in order 11 to render that decision? 12 MR. SCHULZ: You mean will there have to be 13 environmental documentation? 14 MEMBER DEL PIERO: No. No. No. What I mean is is 15 everyone willing to agree to not having any environmental 16 documentation, because of the urgency of the situation? 17 MR. SCHULZ: I don't think there would be that kind 18 of urgency situation. On April 10th, what VAMP calls for, 19 and you can comment on this, too, but what VAMP calls for 20 is for the mediation process to occur right after 21 April 10th and be done within 90 days. It also asks the 22 Board to at the same time that we are going through that 23 mediation process to send a notice out on a hearing on 24 VAMP -- excuse me, on the Vernalis standard. 25 MEMBER DEL PIERO: Yes. CAPITOL REPORTERS (916) 923-5447 52 1 MR. SCHULZ: And that if we were successful on the 2 mediation, then we would immediately go into a hearing 3 process. My understanding of that hearing would be a Water 4 Quality Control Plan hearing to ascertain what should the 5 water quality control standards be at Vernalis, because 6 that is the substance of the stipulation with the San 7 Joaquin folks that resulted in the dismissal -- 8 MR. ROBBINS: We're actually going to cover this -- 9 THE COURT REPORTER: I'm sorry, your name, again? 10 MR. ROBBINS: I'm Ken Robbins. 11 THE COURT REPORTER: Thank you. 12 MR. ROBBINS: We're actually going to cover this 13 under the assurance part of our presentation. 14 MEMBER DEL PIERO: Thank you. 15 MR. ROBBINS: I'm sorry we've gotten out ahead of 16 this. 17 MR. SCHULZ: Okay. 18 MR. ROBBINS: We will actually address what happens 19 in that event. But just as an additional comment, I think 20 that -- meaning no disrespect, but one of the penalties is 21 that we will all have to revisit this Board again. That is 22 not an insubstantial undertaking. Our budgets combined out 23 here for visiting you with regard to this was within the 24 tens of millions of dollars. The River Group Authority 25 alone was in the several millions of dollars. CAPITOL REPORTERS (916) 923-5447 53 1 The time and effort and attention being addressed 2 to what is for us the preservation of our livelihood is not 3 an insubstantial undertaking. And not any one individual 4 member of this body, of this group that's come to this -- a 5 meeting of the minds if you will, is -- has any desire to 6 see this historic agreement go away by virtue of standing 7 up and saying, "This is not enough." 8 However, that opportunity needed to be present in 9 case any one of the parties had badly estimated the 10 impacts, to wit, relative to this agreement. And so while 11 these escape valves are here, they are intended to stay 12 closed. The -- the -- to answer the second question, there 13 are safety nets built underneath it. And I think this 14 might be the appropriate time for Mr. Brandt to discuss 15 assurances. 16 MEMBER DEL PIERO: You can appreciate my concern -- 17 MR. ROBBINS: Absolutely. 18 MEMBER DEL PIERO: -- whether it be an action of this 19 Board subject to CEQA, or whether we have to do the 20 functional equivalent of environmental review. The 90-day 21 period that you provide for in terms of mediation, 22 candidly, is not enough time for us to produce an 23 environmental document -- 24 MR. ROBBINS: We understand that. 25 MEMBER DEL PIERO: -- upon which this Board could CAPITOL REPORTERS (916) 923-5447 54 1 subsequently render a decision. And the point that I'm 2 raising here is very simple: We're being told in one hand 3 this is -- this is what our proposal is and in the event 4 that it all falls apart, we're expecting you to hold a 5 hearing as expeditiously as possible in order to remedy the 6 problem. 7 On the flip side, given the time frame that's been 8 outlined, if you know anything about our process and what 9 it takes to get an environmental document done, it's not 10 realistic. 11 MR. ROBBINS: That's the reason we built a safety 12 net. The 90-day period is just for mediation. But there 13 is a two-year window by which others meet the standards. 14 MR. BRANDT: That's where we come in. Let me just 15 start, my name is Alf Brandt, I'm Assistant Regional 16 Solicitor of the Department of Interior based here in 17 Sacramento. 18 Couple of opening comments. I guess I'm here 19 partly to answer your question, Mr. Del Piero, is: What 20 happens if? What happens if these things fall apart? 21 I also want to emphasize a couple of things that you'll 22 notice the language we've been using today, and I 23 appreciate Ken's comments about the San Joaquin River 24 Agreement. Part of the reason the name changed over time 25 from VAMP to the San Joaquin River Agreement is the reason CAPITOL REPORTERS (916) 923-5447 55 1 that I'm here to talk about today, which are commitments 2 that the United States Bureau of Reclamation and the 3 Department of Water Resources have taken on. 4 And I'd also point you to the provisions that I 5 identify here today, because those provisions were very 6 carefully negotiated, to say the least. I think Mr. Short 7 emphasized that in his presentation. The specific language 8 of how -- what we agreed to and how we agreed to on the 9 conditions of the assurances. And most of the agreement 10 were very carefully negotiated, and we'd be happy to tell 11 you more about that. 12 I will just put these in a few clear points, but I 13 do want to emphasize, please, take a look at the agreement, 14 because those will show you the specific language. 15 Let's start with the conditions. There is one condition 16 with sort of five major points that we are -- that we are 17 looking for. And this is actually what we're really 18 counting on the Board to do. 19 And this is a State Board order that makes some of 20 these findings. And the first one is a finding of 21 environmental protection equivalent to the 1995 Water 22 Quality Control Plan for the Delta. Second thing is, 23 timely hearing if the agreement ends. And I will talk to 24 you about that a little bit more when we get done. Third 25 is the enforcement of the United States Bureau of CAPITOL REPORTERS (916) 923-5447 56 1 Reclamation and the DWR's obligations under this agreement. 2 And that, again, gets down to assurances. And enforcement 3 of issuing water protections under Section 1707. Basically 4 what we're looking for here is the San Joaquin River guys 5 want to make sure we're putting water in the stream, we 6 want to make sure someone downstream doesn't take it. So 7 we just want the protection that this Board can provide, 8 and assurance of enforcement of that protection. And, 9 finally, adjustment -- certain from export some adjustment, 10 to allow them to maybe change a place of use, a variety of 11 things along those lines, to carry out this agreement. 12 And really the assurances are in some way what 13 changed the title of this agreement from the Vernalis 14 Adaptive Management Plan, or the VAMP as we all call it and 15 we still, frankly, continue to call it; but really is the 16 San Joaquin River Agreement, because of some commitments 17 that the United States Bureau of Reclamation toward the 18 end -- latter part of the negotiations. 19 The first one is while the Vernalis Adaptive 20 Management Plan takes the one month, the pulse-flow period, 21 and deals with that and provides some key water to make 22 sure that works. The other, the United States Bureau of 23 Reclamation is willing to take on -- or allow the State 24 Board, or accept the State Board's enforcement or 25 imposition on us of the responsibility of the Vernalis flow CAPITOL REPORTERS (916) 923-5447 57 1 requirements. And part of that is, you'll see in Section 8 2 that we're buying some additional water. So outside that 3 period, outside the pulse-flow period that is the VAMP 4 period. We're also buying additional water to make sure 5 that they're packing flows in October and some water during 6 other times of the year. So that is a key thing that 7 happened sort of later in the negotiation. 8 Also, the United States Bureau of Reclamation and 9 the Department of Water Resources jointly will take on 10 responsibility for Delta outflow, or at least the San 11 Joaquin River portion of Delta outflow, to the extent that 12 that's required under the WQCP. And this, I guess, get's 13 to your point which is the continuing responsibility. 14 We've agreed -- we are the backstop. We've agreed to 15 take on these responsibilities. And if the -- if this 16 thing falls apart and mediation doesn't work, we've agreed 17 up to two years to say, "We'll take full responsibility to 18 make sure that the flows are met to the extent possible on 19 the Vernalis side of the San Joaquin River." So this is 20 really a key portion. So instead of the 90 days that you 21 were concerned about, Mr. Del Piero, it's actually the two 22 years that you have to put together the environmental 23 document and do whatever else. 24 We want timing hearings as quickly as that's 25 possible -- as quickly as that is reasonably possible, CAPITOL REPORTERS (916) 923-5447 58 1 because we do not want to be out there waiting to see what 2 happens, but we'd like you to move as quickly as possible. 3 But we have given you two years to be able to take care of 4 that. And we take care of the environmental 5 responsibilities during that time. 6 And the last thing is in Section 12 you'll find 7 some assurances the San Joaquin River Group members, it 8 basically puts a limit on what their responsibilities are. 9 They are contributing water. They are providing water to 10 meet these flows during the pulse-flow period. And 11 basically we have said that that is enough. We'll take the 12 rest of it. That's all you'll have to give for meeting -- 13 for meeting the San Joaquin River portion, which is a fine 14 determination, of the 1995 WQCP. It doesn't include, or 15 doesn't affect salinity presence, or putting -- let me 16 refresh my recollection, I cannot recall, you'll see it in 17 there, putting water that has high salts, or whatever else 18 polluted water -- I cannot remember -- anyway there is a 19 specific term in there. It's to basically say, look, we're 20 taking care of flows here, and anything for flow at 21 Vernalis we're taking care of. Anything else that there 22 may be in the San Joaquin River are other issues. 23 And I think that's about it on assurances and 24 State Board order. These are key portions from our view 25 and it's why we now call it the San Joaquin River CAPITOL REPORTERS (916) 923-5447 59 1 Agreement, because we're really trying to do a 2 comprehensive resolution of this, not just the one-month 3 period. 4 MR. ROBBINS: Our hope is that by bringing this 5 agreement forward we are able to achieve goals which we set 6 for ourselves relative to this process. Those goals are 7 set out in Section 2.5. As you can see, 2.5.1 deals with 8 the goal of attempting to create an environment whereby 9 salmon fisheries on the San Joaquin can be doubled. 10 Now, we understand that export and flow alone aren't 11 the only two variables operating against the doubling goal 12 for salmon. But to the extent we can help achieve that 13 relative to our agreement, that's certainly one of our 14 purposes. 15 The second purpose is to gather more information. 16 We have be before this Board and other boards many, many, 17 many times talking about how little we knew about our own 18 river systems. And in addition to the VAMP study, which is 19 a part of the San Joaquin River Agreement, each of the 20 agencies is conducting their own in-stream studies. So, 21 hopefully, by the end of this 12 years we will know far 22 more about the San Joaquin River and its tributaries than 23 most other rivers. 24 2.5.3 simply talks about our agreement, our 25 concern that this agreement meets the level of protection CAPITOL REPORTERS (916) 923-5447 60 1 set forth in the Board's 1995 Water Quality Control Plan. 2 And one of the findings that you'll be asked to make after 3 the evidence as opposed to our statements today are 4 presented to you, in fact, that is the case. 5 There are some additional numbers that you need to 6 know about: What the flows are. What the exports are. 7 What the caps are. What the off-ramps are, et cetera, but 8 we have technical teams following this morning to make 9 those presentations to you. So if you have questions of me 10 at this point, I'll be happy to entertain them; otherwise, 11 we'll move right directly to the biology section. 12 Thank you. 13 HEARING OFFICER CAFFREY: Thank you. Mr. Robbins, 14 who are the next presenters? 15 MR. ROBBINS: Mr. Bruce Herbold and Chuck Hansen will 16 be making the presentation to you. 17 HEARING OFFICER CAFFREY: Before we do that I see 18 it's pretty close to 10:30. Why don't we take about a 19 five-minute leg-stretching break here and we'll resume in 20 about five minutes. Thank you. 21 (Recess taken from 10:25 a.m. to 10:39 a.m.) 22 HEARING OFFICER CAFFREY: All right. Thank you all 23 very much. Let's proceed with the presentation of the San 24 Joaquin River Agreement. 25 Continue, gentlemen. Please identify yourselves. CAPITOL REPORTERS (916) 923-5447 61 1 MR. HERBOLD: Yes, I'm Bruce Herbold working for 2 Dr. Kjelson. This presentation is going to cover the 3 biological basis, the experimental design of the VAMP. And 4 just to clarify, this portion actually is the VAMP. 5 Everything that's been talked up to here is the San Joaquin 6 River Agreement, is how you provide these exports which you 7 have already heard other people speak about it, the 8 concept, all framework, and the experimental design for the 9 VAMP. And we had three main objectives. When Chuck and I 10 first tried to figure out some solution that -- 11 HEARING OFFICER CAFFREY: Can you hear the speaker at 12 the back of the room? 13 THE AUDIENCE: No. 14 HEARING OFFICER CAFFREY: All right. Please, raise 15 your hand when you can't so we'll know. You may have to 16 hold that in your hand, sir. 17 MS. WHITNEY: Actually, does this one come off? 18 MEMBER DEL PIERO: No, not without a screwdriver. 19 MR. HERBOLD: I've only got a couple overheads. 20 MR. HANSEN: I'll do the overhead. 21 MR. HERBOLD: See the teamwork. If I can read my own 22 overheads from here, it will help. What we were coming at 23 with this data that was gathered from two kinds of years, 24 years like this year in which the flows in the San Joaquin 25 were very high and the exports were very low and in which CAPITOL REPORTERS (916) 923-5447 62 1 salmon smolt survival is generally good. And the other 2 kinds of years in which the San Joaquin River flow -- well, 3 for instance, this year the flow is about 20,000 and the 4 exports are around a thousand right now. That's typical of 5 a lot of our wet years. 6 The other extreme, we've had San Joaquin flows of 7 1500 with simultaneous exports of 5,000/7,000. During 8 those conditions, salmon smelt survival has generally been 9 bad. But given those kinds of years it's been very 10 difficult to try to assess the incremental benefits of 11 increasing flow, or the incremental benefits of decreasing 12 exports. This -- the VAMP is designed to try to protect 13 salmon at the same level of protection that seems to be 14 targeted by the Water Quality Control Plan in 1995, but 15 using an experimental structure to tell us something about 16 the rules relatively of exports and of flows. So we -- we 17 want to get that immediate protection on the ground, but we 18 want to provide scientific information so that future 19 management of the system -- of the salmon stocks is 20 efficient in relation to water use. 21 That's really all three. We had -- next overhead, 22 please. All of this is contained in Appendix A of the 23 document that's been made available to you. So there were 24 four parameters guiding the structure of the experiment. 25 That is that if we assumed that the barrier is in place, CAPITOL REPORTERS (916) 923-5447 63 1 flows have to be no greater than 7,000 cubic feet per 2 second at Vernalis, or we risk washing the barrier out. 3 From the users of the exports, it seemed that minimum 4 exports were about 1500 cubic feet per second. So those 5 established two parameters -- two ends of the range. We 6 had two regulatory conditions that we were trying to 7 satisfy; but in that, we had to interpret some -- some 8 intent of those. 9 First of those is Delta Smelt Biological Opinion, 10 which seemed to intend that exports would not be more than 11 half of the flows at Vernalis. And the other one was the 12 Water Quality Control Plan itself, which we were trying 13 to -- trying to find a way to implement, but would still 14 give us the scientific information that we needed. 15 I would like to take a small detour as to why we 16 needed to find something equivalent but not the same. That 17 is we have in the Water Quality Control Plan a requirement 18 that flows and exports be equal to each other. Under the 19 Delta Smelt Biological Opinion we had a desire to reach a 20 condition in which exports were half of the Vernalis flow. 21 Those requirements caused the flows and exports to move 22 together always in the same direction in the same amount. 23 So that you couldn't really separate if you raised 24 flows and held exports constant, what is the impact? If 25 you held flows constant and changed exports, what was the CAPITOL REPORTERS (916) 923-5447 64 1 impact? That was the kind of condition that we needed if 2 we were going to separate out the impacts of flows and 3 exports, and that's what we tried to do. 4 But given the two physical constraints and then 5 the two regulatory constraints, if the minimum flow -- if 6 the minimum export was 1500, then the maximum flow had to 7 be at least 3,000 in order to satisfy the Delta smolt 8 opinion's intent as we interpret it. And if the maximum 9 flow could be 7,000, then the maximum exports couldn't be 10 more than 3,000 and still meet that goal for the Delta 11 Smelt Biological Opinion. 12 So then we had four conditions to find: A maximum 13 flow of 7,000; a minimum flow of 3,000; a maximum export of 14 3,000; and a minimum export of 1500. We started getting 15 towards an experimental design within those parameters, 16 then that's represented in Table I of Appendix A. In all 17 of these conditions, then we have flows and exports that 18 are different than either the one-to-one, or two-to-one as 19 a result of trying to separate out the individual impacts. 20 So we have exports of 1500 at three different flow 21 rates: 7,000, 4450, and 3200. And we have exports at two 22 rates: The 1500 and 3,000 at one of the flows, the flow of 23 7,000. And in-between we have a flow of 5700 and an export 24 of 2250, in the middle or close to the middle, to see 25 whether the responses of linear occurred. Without that CAPITOL REPORTERS (916) 923-5447 65 1 one, we'd have to assume that they didn't interact with 2 each other. And most people that I have spoken with 3 believe that there is probably interesting interaction 4 between flows and exports. 5 Second spot then was trying to get the equivalency 6 to the Water Quality Control Plan, that gets into actually 7 what's represented in Appendix B as the hydrology, I'd like 8 to cover briefly. How this works is that we get an 9 increasingly precise forecast of what the baseline flows 10 will be on April 15th. And there are two ways that the 11 flow targets are met. 12 If the expected baseline flow is below one of 13 these numbers, which it usually will be except in years 14 like this, the target flow is the next number up. So if 15 the baseline flow is 3300 cubic feet per second, then the 16 target flow for the April 15th to the May 15th period would 17 be 4450. This breaks away from year type. And one of the 18 things that's really different is that within dry years 19 they may be dry because they had some rain in November, or 20 they had some rain in April and May. Given year types you 21 may have a very high-flow requirement in the dry year, 22 because all of the precipitation came earlier in the year. 23 This tries to get away from that requirement. 24 Conversely, you may have a flow target set for a 25 dry year when it rained a lot in that dry year in the CAPITOL REPORTERS (916) 923-5447 66 1 period leading up to April and there's no real increase in 2 protection. Trying to accommodate both of those problems, 3 we ended up with just looking at the baseline flow 4 conditions which are largely set on -- by other regulatory 5 parameters upstream, and incrementing up one step. Once 6 you know what the flow target is, then the corresponding 7 exporting target is set at everything except the 7,000 csf 8 flow target. And there was agreement that we would go with 9 whichever was convenient. The first year we got 7,000 and 10 after that alternate so that you have an equal number of 11 the 7,000 low export and the 7,000 high export conditions. 12 However, the baseline flows expected out of three 13 tribs seldom go above 5700. And two of our five flow 14 categories require flows of 7,000. Therefore, there's an 15 additional step where if it is -- if it has been wetter 16 than usual in the proceding year and wetter than usual in 17 the current year, the flow targets April 15th to May 15th 18 are two steps above the baseline. That is if the flows 19 were at 4500, the target would not be 5700 it would be 20 7,000 cubic feet for those 31 days. 21 Using that then, we ended up with -- by looking at 22 historical hydrology, an expectation that we would be able 23 to complete all 5 boxes within about 12 years if the next 24 12 years are like a random sample of the last 12 years out 25 of the last 71. So we have tried to meet the intent, but CAPITOL REPORTERS (916) 923-5447 67 1 not the exact numbers in the two regulatory documents and 2 within the physical parameters under control. 3 And I'd like to hand it off to Dr. Hansen. 4 MR. HANSEN: Thank you. My name is Chuck Hansen; I'm 5 a fisheries biologist and consultant with the State Water 6 Contractors. As Bruce has pointed out, the development of 7 the VAMP had a number of objectives. One of the principal 8 objectives that has been discussed this morning is to 9 develop a series of scientific investigations that allow us 10 to quantify the relationship between San Joaquin River flow 11 rates, State and Federal Water Project export rates, and 12 the survival of juvenile chinook salmon emigrating from the 13 San Joaquin River and its tributaries during the spring. 14 What I'd like to describe is the second half of Appendix A, 15 and that's the experimental design and the approach that 16 will be used to actually collect the scientific data to 17 evaluate the performance of the VAMP program. 18 When we started to discuss how we would actually 19 evaluate the performance of VAMP, we quickly decided that 20 the most appropriate techniques would be to use coded-wire 21 tag mark-recapture design. That is a technique that has 22 been used historically to evaluate salmon smolt survival on 23 the Sacramento River. It has also been used on the San 24 Joaquin River. 25 And part of our evaluation in the development of CAPITOL REPORTERS (916) 923-5447 68 1 the experimental design took into account the previous U.S. 2 Fish and Wildlife Service investigations on salmon smolt 3 survival from the San Joaquin River using these coded-wire 4 tag mark-recapture techniques. One of the things we wanted 5 to build into our tests was a degree of continuity between 6 the previous investigations and those that are implemented 7 as part of VAMP so that we could take maximum advantage of 8 the information that has already been collected, as well as 9 maximum advantage of the experience that has been gained 10 over the years in how best to coordinate and to conduct 11 these types of studies. The VAMP experimental design, 12 though, expanded on what had been done historically to 13 address specific issues and to collect specific kinds of 14 information relevant to our study objective. Next one, 15 please. 16 The way we approached the development of the 17 experimental design, much the way the entire program has 18 developed, evolved in a cooperative environment. We had a 19 series of technical meetings, a lot of technical meetings 20 involving various scientific representatives from the 21 Department of Water Resource, the Department of Fish and 22 Game, the Fish and Wildlife Service, EPA, USGS, the San 23 Joaquin River Group, the State and Federal Water Export 24 Interests, the environmental community to talk about the 25 best approach for developing the salmon smolt survival CAPITOL REPORTERS (916) 923-5447 69 1 studies. They underwent extensive peer review in this type 2 of an environment. 3 The test conditions have been briefly discussed. 4 The tests are scheduled to occur between April 15th and May 5 15th. That timing was selected based on information 6 available on the natural seasonal patterns of out-migrating 7 salmon smolt from the San Joaquin River. Bruce has gone 8 over one of the keys, and that's the managed San Joaquin 9 River flows and SWP/CVP exports, the prescribed test 10 conditions that he outlined that are included as Table I in 11 Appendix A. 12 One of the important components of the VAMP test 13 that we built in was stability of the test conditions both 14 in terms of the flows and export conditions during our test 15 period. In the past when these studies have been 16 conducted, there has been substantial fluctuations in flow 17 and export conditions during the period of the tests. And 18 that makes interpretation of the data and the degree of 19 resolution that we can get in the data to detect 20 differences, should they exist, very difficult. So we've 21 established stability in terms of these environmental 22 conditions, which brings to the table all of the other 23 coordination elements that others are going to talk about 24 in terms of the hydrologic coordination. 25 We also established some specific criteria with CAPITOL REPORTERS (916) 923-5447 70 1 regard to the types of environmental conditions during 2 which VAMP testing would be conducted and how we would 3 actually look at those test results. One of the concerns 4 on the lower San Joaquin River is the influence of water 5 temperature during the spring on salmon smolt survival. 6 And to limit that influence we prescribed that the 7 tests would be conducted when temperatures are less than 68 8 degrees. We have also included the provision that the Head 9 of Old River Barrier would be installed during this testing 10 period. And there have been a number of questions raised 11 at our technical meetings as well as elsewhere about how we 12 would address some of the more recent proposals regarding 13 the Head of Old River Barrier, the installation of the 14 culverts and various operational conditions. Through our 15 cooperative technical process we've been able to work with 16 the representatives of the Department of Water Resources 17 and Fish and Game to accommodate those kinds of conditions 18 as they relate to the Head of Old River Barrier operation 19 into the overall testing protocols for VAMP. 20 We also have had to deal with the issue of these 21 high flow years in which the Head of Old River Barrier 22 could not be installed. And we have developed a series of 23 contingency plans that allow us to conduct informative 24 testing, to get useful information on salmon smolt survival 25 under those environmental conditions as well. CAPITOL REPORTERS (916) 923-5447 71 1 And 1998 is an example of our ability to 2 accomplish that. We have high flows in the San Joaquin 3 River, we have low exports. We do not have a Head of Old 4 River Barrier. And, yet, the technical team was able to do 5 the necessary coordination to conduct the salmon smolt 6 survival study this year. And those studies are ongoing 7 today. 8 In addition to the biological studies, we have 9 integrated as part of our experimental design other types 10 of information that will be important in documenting the 11 conditions that occur during each of the testing intervals. 12 We've worked with representatives of USGS, DWR, and the 13 Bureau to deal with the issues of flow measurement, 14 velocity measurements, and hydrologic conditions within the 15 lower San Joaquin in the Delta. They have a number of 16 monitoring stations and a number of measurements that 17 they're collecting to compliment our biological studies. 18 USGS has designed and is conducting this year, 19 again, some dye-tracking studies to provide additional 20 information regarding hydrologic conditions. We have 21 implemented as part of VAMP an extensive water temperature 22 monitoring network with monitoring instruments located from 23 Mossdale to Chipps Island that record temperatures every 24 24 minutes during our testing periods so that we can document 25 those environmental conditions. CAPITOL REPORTERS (916) 923-5447 72 1 We also incorporated as part of our test live car 2 observations so that we hold a sub-sample of fish from each 3 of our release groups at the release site to determine 4 their post-release survival, their physiological condition, 5 as well as some quality control checks. And we've 6 developed as part of the VAMP program what we feel to be an 7 appropriate foundation, or framework, for a variety of 8 complementary studies that augment the basic survival tests 9 incorporated as part of VAMP to address other factors. 10 HEARING OFFICER CAFFREY: Do you have a question? 11 CO-HEARING OFFICER STUBCHAER: Yes. Can you tell me 12 what "live car" is? I saw that in the reading that I -- 13 MR. HANSEN: Live car is just a biologist's way of 14 just saying a big cage. It's a cage that's about four-feet 15 wide, about three-feet deep. The fish are simply held in 16 that cage. 17 CO-HEARING OFFICER STUBCHAER: In the river? 18 MR. HANSEN: In the river, under the conditions that 19 the fish that have been released would also be 20 experiencing. 21 CO-HEARING OFFICER STUBCHAER: Thanks. 22 MR. HANSEN: One of the key -- 23 MEMBER DEL PIERO: How do you accommodate for 24 predation in that circumstance? 25 MR. HANSEN: In that circumstance there is no CAPITOL REPORTERS (916) 923-5447 73 1 predation mortality. 2 MEMBER DEL PIERO: I understand that. How do you 3 accommodate for it then? 4 MR. HANSEN: In terms of looking at the survival 5 results for those fish that are released, the fish that are 6 released from the truck are marked, they do experience 7 losses at, you know, a variety of different sources 8 including predation. That becomes part of the survival 9 estimate that we calculate at the different flow and export 10 conditions. 11 MEMBER DEL PIERO: You have some mechanism by which 12 you calculate that fraction of loss? 13 MR. HANSEN: We do not have any way to actually 14 calculate the incremental contribution of predation, or the 15 incremental contribution of most other factors to that 16 overall survival rate. We simply calculate a total rate 17 for that particular test. And we won't be able to tell you 18 what incremental contribution predation, or other sources 19 of mortality may add to that loss. That is one of the 20 complementary studies though that we have discussed at the 21 technical team level, is to try to identify complementary 22 studies that would give us a better sense for what that 23 predation loss is. 24 HEARING OFFICER CAFFREY: Please, proceed. 25 MR. HANSEN: In terms of the basic survival studies, CAPITOL REPORTERS (916) 923-5447 74 1 they're really founded on the use of hatchery produced 2 juvenile chinook salmon. In development of the VAMP 3 program we have prioritized the use of San Joaquin origin 4 salmon stocks for purposes of this testing period. Those 5 fish are currently being produced at the Merced River Fish 6 Hatchery. There have been a number of discussions at the 7 technical level about the availability of San Joaquin 8 origin stock fish for use in these kinds of testing 9 programs, limitations and constraints on the Merced River 10 hatchery facilities. 11 We have recognized that those are constraints, but 12 one of the issues that has arisen is whether or not the 13 VAMP program relies, or requires the construction of an 14 additional hatchery, for example, on the Tuolumne River. 15 And the answer to that is no. The VAMP study requires a 16 number of fish to be produced. We have not specified how 17 those fish would be produced, or where within the San 18 Joaquin River Basin. So there are some alternatives 19 available for actually developing the necessary production 20 of these fisheries in the tests. 21 We've also incorporated Feather River stocks which 22 has been used historically as a backup and a complementary 23 set of investigations in the event that we don't have an 24 adequate number of fall-run salmon from the San Joaquin 25 River. The fish are individually tagged in the hatchery CAPITOL REPORTERS (916) 923-5447 75 1 using what's referred to as a coded-wire tag. It's a small 2 metal tag about the size of a human hair, very short. Has 3 what looks like a bar-code embedded in it. 4 Those pieces of metal are then implanted in the 5 nose of each of these two-and-a-half-inch-long fish. And 6 then the adipose fin is physically clipped off the fish to 7 let us know that fish does have a coded-wire tag. That 8 allows us then to identify the location and the release 9 group of fish for each of those individuals that are 10 subsequently recaptured as part of our testing program. 11 We've also incorporated as part of the coded-wire 12 tagging disease and health inspections, quality control and 13 quality assurance program to give us the comfort and the 14 confidence in the results that are produced as part of this 15 program. 16 HEARING OFFICER CAFFREY: While you're making a 17 change of transparencies, let me state for the record that 18 we have been joined by Mr. Pettit, Mr. Walt Pettit our 19 Executive Director, who has returned from our budget 20 hearing in the Assembly. Perhaps, we should ask Mr. Pettit 21 if we should keep going. 22 MR. PETTIT: They didn't put us completely out of our 23 misery, Mr. Chairman. I'm not sure if that's the good 24 news, or the bad news. Mr. Del Piero asked if he should 25 file for unemployment, and I told him, no, but probably I CAPITOL REPORTERS (916) 923-5447 76 1 should. 2 HEARING OFFICER CAFFREY: I hope you're being 3 facetious. 4 MR. PETTIT: We have had a lot worse sessions. 5 HEARING OFFICER CAFFREY: Mr. Hansen, excuse my 6 interruption. 7 MR. HANSEN: Not at all. 8 HEARING OFFICER CAFFREY: Please, proceed, sir. 9 MR. HANSEN: Our experimental design limits the 10 release of these tagged fish at four locations: Mossdale 11 on the lower San Joaquin River immediately upstream from 12 the confluence with Old River; Dos Reis on the San Joaquin 13 River immediately downstream of the confluence with Old 14 River; at the mouth of the Mokelumne River; and at Jersey 15 Point. And the latter two releases at the mouth of the 16 Mokelumne River and Jersey Point allow us to calibrate our 17 downstream sampling to accommodate high-flow years/low-flow 18 years and to give us some scientific adjustments. 19 MEMBER BROWN: Was there consideration to go farther 20 upstream? 21 MR. HANSEN: There has been some consideration. And 22 there are other coded-wire tags releases that are made 23 further upstream in the tributaries themselves. Those fish 24 are then resampled both in the tributaries as well as in 25 the Department of Fish and Game sampling at Mossdale. And CAPITOL REPORTERS (916) 923-5447 77 1 those fish would then move down through the San Joaquin 2 River and would be resampled as part of our program as 3 well. 4 So there has been, in our technical discussions, a 5 complementary set of considerations for not only the Delta 6 component, but how the Delta studies fit within the broader 7 context of fisheries investigations going on further 8 upstream in the tributaries. And we've tried to maximize, 9 to the extent we can, the use of the fish, the 10 prioritization of the available fish from the hatchery, and 11 the information that we all gain through this coordinated 12 effort. 13 Our basic release strategy includes two releases 14 during each of the testing periods. The first release 15 would occur sometime approximately April 16th to 16 April 20th, with the second release being approximately 17 April 23rd to 28th. These dates are somewhat flexible 18 based on the environmental condition, the size of the fish, 19 and the number of other factors that the technical team 20 will take into account in the coordination each year as we 21 finalize the design. 22 We would be releasing under this experimental 23 design 75,000 fish at Mossdale; and then 50,000 fish each 24 at Dos Reis, the Mokelumne River Mouth, and Jersey Point. 25 Within Attachment A there are prioritizations and CAPITOL REPORTERS (916) 923-5447 78 1 contingency plans built into this table to accommodate 2 conditions where we have other environmental factors, or 3 inadequate numbers of fish to accommodate the entire 4 experimental design. 5 HEARING OFFICER CAFFREY: Yes, Ms. Forster? 6 MEMBER FORSTER: Are you doing that now? I mean it's 7 April 16th. Is this for next year? 8 MR. HANSEN: No. 9 MEMBER FORSTER: Are you doing anything now? 10 MR. HANSEN: We, in cooperation with the Department 11 of Fish and Game, the U.S. Fish and Wildlife Service, all 12 of the parties that have been part of the VAMP discussions, 13 we actually made releases of 75,000 fish at Mossdale, 14 Tuesday -- 15 UNIDENTIFIED MAN: Thursday. 16 MR. HANSEN: Last Thursday. We made another release 17 of 75,000 marked fish at Dos Reis on Friday. We had the 18 live cars in place. We did the physiological studies. The 19 Fish and Wildlife Service did the health monitoring. We 20 will be -- we did make releases of 50,000 coded-wire tagged 21 fish from the Merced River hatchery yesterday at Jersey 22 Point. We will do the entire cycle again with all four 23 sets of releases of 50,000 fish each beginning later this 24 week. 25 We have the intensive sampling program underway at CAPITOL REPORTERS (916) 923-5447 79 1 Jersey Point, which I'll describe in a moment. We have -- 2 we have an expanded recapture sampling effort by the Fish 3 and Wildlife Service at Chipps Island. We are collecting 4 data, as we speak, regarding the survival of juvenile 5 salmon migrating under this year's conditions. And we did 6 this last year as well. 7 MEMBER DEL PIERO: Do you assume that this year's 8 conditions will be somewhat near optimum in terms of 9 survival rates? 10 MR. HANSEN: I personally would say that this year is 11 likely to be about as good as we're likely to see in terms 12 of the flows, the temperatures, the export rates, all of 13 the other conditions that we think are important for 14 influencing salmon survival on the San Joaquin River seem 15 to be lined up to give us a real good data point. So it 16 will be a very important year in terms of getting 17 information on what those survival rates are under these, 18 what we think to be very good conditions. 19 MEMBER DEL PIERO: High flow, low export -- 20 MR. HANSEN: High flow, low export, low temperature. 21 So it will be a very important and informative data point 22 even though we don't have the Head of Old River Barrier 23 installed. And that's the kind of information and the way 24 we tried to develop this program to maximize the kind of 25 information that we can develop through this sort of CAPITOL REPORTERS (916) 923-5447 80 1 survival study. And it seems to be working well. 2 HEARING OFFICER CAFFREY: Let me ask just one 3 question, if I could. 4 MR. HANSEN: Sure. 5 HEARING OFFICER CAFFREY: This is housekeeping, not 6 meant to stifle in any way, just to manage the time. Mr. 7 Short, how much more time is the VAMP presentation going to 8 take, do you estimate? 9 MR. SHORT: Another 30 minutes. 10 HEARING OFFICER CAFFREY: Another 30 minutes, okay. 11 I was just wondering if we could get to the commenters 12 before the lunch break. We might have time for a couple 13 more. I'd like to get to Mr. Wright, if we can. So why 14 don't we proceed. 15 MR. SHORT: We'll try to speed it up a little bit. 16 HEARING OFFICER CAFFREY: I'm not trying to stifle 17 you. I'm just trying -- it's important information. 18 MR. HANSEN: As we've mentioned, the key to doing the 19 survival studies is the release of the known number of fish 20 upstream and then to recapture those fish further 21 downstream. Our recapture locations include, Jersey Point, 22 which is a new sampling location specifically developed as 23 part of the VAMP program. We did a pilot study there last 24 year. We have fully implemented that sampling location 25 this year. Sampling is done with a Kodiak trawl, with a CAPITOL REPORTERS (916) 923-5447 81 1 level of effort that is 7 days a week, 18 hours per day. 2 We also have the U.S. Fish and Wildlife Service 3 Chipps Island sampling. That sampling was expanded to be 4 twice as much this year to see how that affects the 5 recoveries, as well as the routine salvage facility 6 operations at both the state and federal water projects. 7 In addition, the coded-wire tagged salmon will be available 8 and will provide additional survival information as they 9 are recruited to the adult fishery in the ocean both in the 10 commercial as well as recreational catch. 11 Just to summarize, we do have an experimental 12 design that has undergone extensive peer review by a number 13 of scientists. It represents a cooperative effort with 14 multiple release locations, multiple recapture locations. 15 It accommodates a variety of environmental conditions. And 16 it is aimed at providing us the kind of information over 17 this 12-year period of investigation that will address many 18 of the questions that have been lingering; and many of the 19 issues regarding the effects of flow on the lower San 20 Joaquin River and the interaction of exports on salmon 21 smolt survival in the spring. 22 And with that, I'll complete. 23 MR. SHORT: Are there any questions for the 24 biologists? 25 HEARING OFFICER CAFFREY: Does that conclude the CAPITOL REPORTERS (916) 923-5447 82 1 biology presentation? 2 MR. SHORT: Yeah. 3 HEARING OFFICER CAFFREY: I don't see any responses. 4 We may have -- there may be questions at the end of the 5 complete presentation. 6 MR. SHORT: Okay. The hydrology will be next. 7 HEARING OFFICER CAFFREY: Thank you. Thank you for 8 your presentation, lady and gentlemen. 9 MR. STEINER: Good morning. My name is Dan Steiner, 10 I'm a consultant to the City and County of San Francisco 11 Public Utilities Commission. I've been serving, oh, as a 12 hydrologist or modeler for the San Joaquin River Group in 13 the VAMP negotiations. Our presentation is going to, at 14 least, give you a smattering of some of the details as far 15 as how the flows are arrived at in terms of procedurally, 16 mechanics in terms of the flows that's out there, the year 17 type that we're in. 18 With me I have Marc Van Camp who will be 19 discussing some of the historical proof, or the pudding of 20 the fact that we have as a group as operators historically 21 been able to regulate flows at Vernalis; and also to 22 discuss our efforts that we did this year; also an attempt 23 to stabilize those flows at 7,000 csf. 24 Also, on the panel is Ed Winkler, who can 25 entertain discussions about the export side of the VAMP CAPITOL REPORTERS (916) 923-5447 83 1 experiment, if we need to get there. And also we have John 2 Burke who this year from the Bureau of Reclamation served 3 the duty of trying to coordinate the various operators in 4 the San Joaquin Valley, and trying to perform some type of 5 stabilizing effect at the Vernalis flows this year, 6 which Mr. Hansen and them are trying to test some catches 7 of fish out there this morning. 8 I'd like to start with this first to discuss the 9 operations from the modeling side. What we tried to do -- 10 again, fitting in with what Mr. Herbold discussed, we're 11 trying to establish a wide range of flow and export 12 conditions to try to find out discreet impacts, or relative 13 differences upon smolt passage through the Delta by 14 controlling exports and flow conditions. 15 In terms of operational goals as they also pointed 16 out, we're trying to do that by providing a stable flow 17 condition, as they put on the table between 2 and 7,000 csf 18 for a 31-day period. Generally, we refer to the April 15th 19 to May 15th period, that is not set in stone. We're trying 20 to bring in other factors to determine what period is best 21 to do that. We are trying -- there is a consideration 22 along with the testing procedures to try to match when the 23 natural fish out there are also doing their thing as 24 opposed to making this just a study condition. 25 We also, beyond having stabilized flows between 2 CAPITOL REPORTERS (916) 923-5447 84 1 and 7,000 csf and trying to stabilize flows above the 7,000 2 csf condition, we are -- the second bullet there which is 3 even if we're outside of the real desired area of 4 information testing here, we're trying to lead to a control 5 condition, again, to gather whatever data we can under a 6 control study environment. 7 Along with the flow conditions out there we're 8 having also the exports follow -- according to a table 9 you'll see here in a minute, whatever the flow conditions 10 out there somewhat establishes what the export condition 11 will be. And those exports at this point would be range 12 from either 1500 csf, the 2250 csf, or the 3,000 csf level. 13 HEARING OFFICER CAFFREY: Question. 14 CO-HEARING OFFICER STUBCHAER: Would you try to 15 maintain those flows between 2 and 7,000 csf as close as 16 possible to the target flows listed in the table, or would 17 it be just whatever you could do to keep it steady? 18 MR. STEINER: No. We are trying to establish a 19 controlled flow at one of those levels. Again, to refresh 20 your memory, Mr. Stubchaer, this table you saw before, we 21 are trying to establish a stable flow rate at one of those 22 columns: 2000, 3200 csf, 4450, 5700, 7,000, stabilize 23 above 7,000. And then one of the exports conditions fall 24 within the data point that we're trying to gather at that 25 point. CAPITOL REPORTERS (916) 923-5447 85 1 As was discussed by Mr. Herbold briefly, we have 2 in place a part of the San Joaquin River Agreement and the 3 VAMP element of it specific criteria of how we choose one 4 of those data points in terms of flow. And as presented 5 before, it's essentially that we're trying to incrementally 6 step up to the next highest level of flow for the test 7 condition based on what the flow would be out there with no 8 effort on our part. 9 So, essentially, looking at the existing flow out 10 there, and you're trying to step up to the next highest 11 data point. And so, for instance, if you had 3300 csf in 12 the river before you get any action, you'd be going for the 13 4450 csf point. On top of that, as they pointed out, there 14 is a limited population of years, at least historically, 15 where you get into the 4,000 and 5700 csf range. And 16 knowing we have at least -- at least statistically, a 17 requirement to get to 7,000 csf twice as opposed to once in 18 these other flow conditions, we needed to create a 19 condition where we took two steps up for a flow objective. 20 And that's what we refer to as a double step. 21 And so in those years when you're not essentially 22 following -- the current year is essentially not following 23 a previously dry year, you will take the effort to step up 24 just not one level of the flow requirement, but up to two 25 steps of the study test condition. CAPITOL REPORTERS (916) 923-5447 86 1 While we've talked about -- we've been focusing in 2 and out of, essentially, the San Joaquin River Agreement 3 and the VAMP. The VAMP portion has several components as 4 far as the water that can be provided by the San Joaquin 5 River Authority, as discussed previously. Some of the 6 contingencies, or some of the elements that are considered 7 when we're deciding how much water will come from the 8 authority members, as discussed before, it was -- it's 9 contingent on the assumption that the New Melones will 10 operate to the interoperations format. 11 There is consideration that in sequential drought 12 sequences, because of the waters being provided in all the 13 other types of years, that there is a relaxation allowed to 14 the authority members, essentially it's a third-year issue 15 that essentially if you had three years of drought in a 16 row, there is a different commitment from the river 17 authority members towards meeting those VAMP target flows. 18 There is also a limitation, or an initial 19 indication, or -- or constraint of how much water is 20 certain at Vernalis towards the VAMP flows in consideration 21 of those double steps. The water firmly secured under this 22 agreement is limited to 110,000 acre feet from the San 23 Joaquin Authority members going towards meeting those VAMP 24 target test flows. 25 But beyond that there is within the agreement the CAPITOL REPORTERS (916) 923-5447 87 1 recognition that the members will be entering the willing 2 seller market to provide additional water over and above 3 what would have been capped at that 110,000 foot level. 4 This is, again, toward meeting the full VAMP requirement. 5 Outside of the VAMP also considered in terms of 6 hydrologic effect at Vernalis we do have some additional 7 provision into the agreement which was Merced providing an 8 additional chunk of water, 12,500 acre feet for 9 availability in October to assist in the fall in-migration 10 flows. And also Oakdale Irrigation District has committed 11 water over and above their VAMP commitment to be available 12 to Reclamation use within the watershed. 13 Let's get down to the performance, as far as what 14 we could expect to see out at Vernalis. What I've done 15 here is taken the hydrologic studies, the 71-year sequence 16 of hydrology, grouped the anticipated flows at Vernalis by 17 year type; and I'm showing you now the average flows that 18 can be expected during each year type, as a result of, at 19 least, the firm side of the San Joaquin members' water 20 commitment here, and that essentially is the 110,000 acre 21 foot. 22 As you can see, let me point your attention 23 towards the third bar in each graph segment there, that is 24 the anticipated performance at Vernalis by year type when 25 only considering that the VAMP target flows will be CAPITOL REPORTERS (916) 923-5447 88 1 established and that the San Joaquin River Member Authority 2 persons will be providing up to the 110,000 acre foot 3 water. As -- for comparison to look -- if you could 4 roughly state that the existing flow in terms of during the 5 April/May period, essentially, at the time of the Accord 6 the 1994 condition, the first bar in each group represents 7 what the estimated flow is, essentially, if you want to 8 call it the "no action." 9 Along the way, as was recognized in the Accord and 10 in the State Board original plan, is things have happened 11 in the basin along the way that have incrementally improved 12 flows at Vernalis, not necessarily within the year action. 13 One of those would be that on the Tuolumne River we had a 14 FERC settlement agreement there which by itself increased 15 the flow condition at Vernalis. 16 So what we're doing is essentially -- as far as 17 what we're anticipating to come after the implementation of 18 VAMP is the far right bar. We're starting from here and 19 along the way things have happened to also improve the flow 20 at Vernalis. 21 CO-HEARING OFFICER STUBCHAER: I have a question, 22 Mr. Chairman. 23 HEARING OFFICER CAFFREY: Go ahead. 24 CO-HEARING OFFICER STUBCHAER: Where would that 25 110,000 acre feet of additional water proposed flow be in CAPITOL REPORTERS (916) 923-5447 89 1 the absence of a VAMP? When would it occur? Where would 2 it be used? 3 MR. STEINER: The water can come from various sources 4 from the members. In general it could be as much as could 5 remain in storage under the control of the -- of the 6 entities that do have reservoirs. They may have -- there's 7 various means of making that water available. It can come 8 from groundwater, reservoir operation, it can come from 9 conservation. 10 CO-HEARING OFFICER STUBCHAER: Is there a proposed 11 reduction in consumptive use to provide that much water? 12 MR. STEINER: We have not evaluated it in terms of it 13 being a loss in consumptive use. 14 CO-HEARING OFFICER STUBCHAER: So if you kept it in 15 the reservoir, you couldn't keep it there forever. It 16 would have to be released sometime? 17 MR. STEINER: It would be released during a wet 18 period, correct. As far as the effect of where the water 19 comes from, that is going to be the subject of an EIR/EIS 20 analysis in terms of those impacts, or those effects being 21 evaluated. 22 MEMBER DEL PIERO: Excuse me, which EIR/EIS are you 23 referring to? 24 MR. STEINER: The first page of it. I believe your 25 own staff is evaluating this alternative. CAPITOL REPORTERS (916) 923-5447 90 1 MEMBER DEL PIERO: So you're asking us to evaluate? 2 MR. STEINER: No. We're independently doing an 3 EIR/EIS. 4 MEMBER DEL PIERO: Okay. I was making sure I knew 5 what you're talking about. I didn't think you were going 6 to leave that to us. 7 MR. VAN CAMP: Good morning. 8 HEARING OFFICER CAFFREY: Good morning. 9 MR. VAN CAMP: I'm Marc Van Camp, engineer working on 10 behalf of the San Joaquin River Group. As a follow-up to 11 what Dan presented, you certainly are asking: How's it 12 going to get done? The best way to get this done, I think, 13 is to follow a past successful example. 14 And in recent past the Bureau of Reclamation and 15 Fish and Game have coordinated flows on the San Joaquin 16 River system. And I'm sure, certainly, other resource 17 agencies were involved. I was not directly involved. I am 18 not trying to take credit for this operation; I am simply 19 reporting it. 20 You should have in front of you the colored 21 graphs. I did provide copies to the crowd. They are not 22 in color. As you can see here on this graph, which is the 23 1993 operations, the operations of each tributary shown in 24 different colors and the resulting Vernalis flow. The one 25 of most interest, and the one that shows the example the CAPITOL REPORTERS (916) 923-5447 91 1 best, I think, is 1994 where the agencies were looking at 2 numerous -- or three pulses at Vernalis. And they did that 3 at different combinations of pulse flows from the various 4 tributaries. These coordinations of these operations were 5 done informally, a lot by telephone, I'm sure. And the San 6 Joaquin River Agreement is going to attempt to formalize 7 those coordinations. 8 Through the -- the agreement establishes the 9 technical committee. And we have -- what we show here is 10 the -- is the various tasks of the project work team, or 11 the biological side of it; and the hydrology group, which 12 is what I'm going to discuss in a little bit more detail. 13 The hydrology group is going to gather the data 14 from the various tributaries. It is -- it has two 15 co-coordinators, the Bureau of Reclamation and a 16 representative from the San Joaquin group. And as Dan 17 mentioned, John Burke has been instrumental in this year's 18 coordination. 19 This is to follow through on Appendix B, which 20 you've heard about, and that is the planning and operation 21 and coordination. That establishes the framework and the 22 protocols for obtaining the target flows, which you've 23 seen. The key is communication. Beginning in February 24 after the initial February forecast, the group intends to 25 get together and has in '98, which I'll show you a brief CAPITOL REPORTERS (916) 923-5447 92 1 graph momentarily, and from there on continue on with 2 operation forecast provided to the lead of the hydrology 3 group, which reports to the technical committee and in 4 March meets as much as weekly with the updated forecast. 5 The hydrology group will estimate the supplemental 6 water required to meet the target flow at Vernalis based on 7 their determination of the forecasted flow for the test 8 period; and implement flow operations plans to get that 9 flow down there. One item that's not identified on here 10 that I think will be a job for the hydrology group is to 11 make sure the calibration of the flow points, the San 12 Joaquin River, Vernalis, and the other locations are 13 calibrated at key times prior to the test period. That 14 would undoubtedly be done in coordination with the USGS. 15 The hydrology group will also prepare annual 16 reports, design procedures, and report to the technical 17 committee. In 1998 three hydrology group meetings were 18 undertaken starting in February, along with numerous phone 19 calls. And this shows the forecast back in March 17th, 20 which is at a point in time we thought we still had some 21 ability to stabilize flows during the test period. 22 Shortly after that, we found out who really was in control 23 of this system. And as you know the flows are in the 20 to 24 25,000 range right now. 25 We haven't all hope, maybe a little optimistic on CAPITOL REPORTERS (916) 923-5447 93 1 our part, but we do still plan with John's to coordinate, 2 communicate, and hope to have some chance of stabilizing 3 flows. So with that we hope the technical committee and 4 the various sub-groups will be able to make these target 5 flows work. 6 And with that unless there's questions, I think 7 we're ready to turn it back over to Mr. Short. 8 HEARING OFFICER CAFFREY: Thank you, sir, appreciate 9 your comments. Mr. Short. Thank you, Mr. Steiner, and all 10 of you gentlemen. 11 MR. SHORT: One other comment, as well as the 12 technical committee we do have a management committee. 13 These things will come up from the technical committee over 14 to the management committee. There will be oversight 15 there. I think the important aspect of that is: There is 16 a process in place to resolve we would hope just about 17 every issue as it comes up. 18 We have a final comment in terms of the Board's 19 process. Mr. O'Laughlin will comment on that. It will be 20 very brief, Mr. Chairman, and we'll turn it back over to 21 you and you'll have the opportunity to open it up for 22 comment. Thank you and the Board for its patience. 23 HEARING OFFICER CAFFREY: Thank you, gentlemen. Good 24 morning, sir. Welcome to you. 25 MR. O'LAUGHLIN: Thank you, Mr. Chairman. Now that CAPITOL REPORTERS (916) 923-5447 94 1 you've heard about the San Joaquin River Group settlement, 2 the San Joaquin River Group Authority comprises of price 3 water users, the San Joaquin River Exchange Contractors, 4 MID, TID, OID, SSJID, and Merced Irrigation District would 5 like to propose a process for the State Water Resources 6 Control Board to incorporate this agreement into the water 7 right hearing. 8 This was, as you noted earlier, the second 9 component of your hearing here today. In May we would 10 envision that the State Water Resources Control Board would 11 issue a hearing notice for the San Joaquin River Agreement. 12 The hearing on the San Joaquin River Agreement would start 13 or commence in July of 1998. We would envision written 14 testimony for the hearing would be due 30 days prior to the 15 commencement of the hearing. 16 As you are all aware, the agreement has in it 17 certain components that have to be done in addition to the 18 water right hearing aspect. One of those is a petition 19 pursuant to Water Code Section 1707 to protect this amount 20 of water going down the river to make sure it reaches 21 Vernalis. The other component of the agreement that will 22 have to be done is that there will be certain permit 23 changes, or license changes to the people who are making 24 the water available in order to make sure that they are 25 protected under the Water Code in making this water CAPITOL REPORTERS (916) 923-5447 95 1 available and making it available at Vernalis. 2 In May, also, we would envision that the State 3 Board would issue hearing notices for any other settlement 4 that's in agreement that they hear here today that need to 5 proceed forward. We envision separate and distinct hearing 6 notices for each settlement agreement, settlement and/or 7 agreement. And that is because as you've heard, each 8 settlement agreement is different and distinction given its 9 location in relationship to the Bay-Delta and the parties 10 involved and what those details of those agreements ensure 11 and entail. 12 We would expect that the San Joaquin River Group 13 and the San Joaquin River Agreement would go first in July, 14 and that the other settlements and agreements would be here 15 heard afterwards in either July and August. 16 We would also envision that there are outstanding 17 other settlements that have not yet come to fruition. We 18 would encourage the Board, as you did to us and we would 19 like you to extend that courtesy to others, is to allow 20 them the time to finish their settlement agreements and 21 come back to this Board in another workshop either in May 22 or in early June to give you an update of those settlements 23 so that if they have occurred, that those can be 24 incorporated into hearings in either August or early 25 September. CAPITOL REPORTERS (916) 923-5447 96 1 HEARING OFFICER CAFFREY: Excuse me, sir. You would 2 see that running on pretty much a separate track so as not 3 to repeat, or slow down the hearings on the agreements that 4 have already formulated? 5 MR. O'LAUGHLIN: Absolutely. What we would envision 6 is that what would occur is that a workshop would be held 7 similar to a workshop here, for an agreement that would 8 come to fruition that after the workshop was done, the 9 State Board, if it deemed it necessary to go forward, to 10 issue a notice of hearing on that agreement. 11 And then what would be done is that you would 12 schedule a hearing date for August 15th, let's say, and 13 then their written testimony would be due 30 days prior to 14 that hearing, or on July 15th. So their process would not 15 impede the process that's already ongoing. And it's kind 16 of like a rolling settlement agreement. So we have four 17 now, hopefully we can one or two later. 18 MEMBER DEL PIERO: I have one question. 19 HEARING OFFICER CAFFREY: Mr. Del Piero. 20 MEMBER DEL PIERO: How can you possibly satisfy the 21 environmental review requirement if you don't know what the 22 project is? 23 MR. O'LAUGHLIN: Well, you do not know what the 24 project is yet. 25 MEMBER DEL PIERO: Right. So how do we hold a CAPITOL REPORTERS (916) 923-5447 97 1 hearing? 2 MR. O'LAUGHLIN: Well, you can hold a hearing and not 3 have your environmental review done. And you've already 4 done that. In fact, CEQA doesn't require you -- in fact, 5 your own process that is set up right now and what we will 6 talk about in a minute, and we have a paper proposed that 7 we will be submitting to the Board tomorrow on the CEQA 8 process, is your CEQA documentation will not be final until 9 such time as you're ready to issue orders. So you're going 10 to issue a CEQA document, finish your CEQA document, and 11 then issue orders based on the CEQA documentation that you 12 have completed. 13 MEMBER DEL PIERO: Do you -- 14 MR. O'LAUGHLIN: Go ahead. 15 MEMBER DEL PIERO: I don't want to get into it. 16 That's -- that's -- 17 MEMBER BROWN: Let's continue. 18 MEMBER DEL PIERO: There's -- there's -- I mean 19 conveniently ignoring the public's right to comment on CEQA 20 documents, it's not something this Board does regularly. 21 MR. O'LAUGHLIN: I mean, if I may, you have a CEQA 22 document that's out and you have -- you will have a 23 supplement to that CEQA document that we understand will be 24 coming out in May. The comments on those will be coming 25 out and the comment period will close sometime before the CAPITOL REPORTERS (916) 923-5447 98 1 start and the commencement of the water right hearing. 2 MEMBER DEL PIERO: Maybe I'm not correct, what you're 3 propose -- or maybe I'm not being clear. 4 MR. O'LAUGHLIN: Okay. 5 MEMBER DEL PIERO: I think I'm correct. What you're 6 proposing is we wait until later to evaluate an alternative 7 that has not yet been negotiated. So how do we get that 8 incorporated into the environmental document that we're 9 currently evaluating? 10 MR. O'LAUGHLIN: Well, you'd have to do, in our 11 minds, one of two things, either, A: It's covered under 12 your CEQA document already under the range of alternatives 13 that have already been presented -- 14 MEMBER DEL PIERO: We can't make that determination 15 until we know what the alternative is, so what is the other 16 alternative, then? 17 MR. O'LAUGHLIN: Then the other alternative is to do 18 what you have done with the San Joaquin River Agreement, 19 and that is to issue a supplement to your draft EIR. 20 MEMBER DEL PIERO: In which case, we -- in order to 21 issue the supplement and allow comment time, it will take 22 at least three months, right? So how do we hold a hearing 23 in August? 24 MR. O'LAUGHLIN: Well, September -- August, 25 September, I used August 15th as an example. If you get a CAPITOL REPORTERS (916) 923-5447 99 1 hearing date, if you have proposed settlements coming in 2 late May, or early June you have a workshop on it, you 3 notice a hearing, you schedule that hearing for late 4 August, early September. You do a supplemental 5 environmental documentation, if need be. 6 If you don't need it and if it's covered by your 7 range of alternatives, then you can incorporate it within 8 your range of alternatives. We have prepared a 15-page 9 briefing memorandum for the Board on the CEQA process, 10 which we will be submitting tomorrow at the workshop. 11 HEARING OFFICER CAFFREY: That would be very helpful, 12 Mr. O'Laughlin. 13 MR. O'LAUGHLIN: Thanks. 14 HEARING OFFICER CAFFREY: Please, proceed. 15 MR. O'LAUGHLIN: Thank you. At the end of the 16 hearings, and at the end of the -- we would envision that 17 the settlement agreements would have a proposed order. And 18 after the proposed order the final orders would be issued. 19 After all the settlement agreements have been heard, we 20 would envision that the State Water Resources Control Board 21 would send out a notice for the remainder of the water 22 rights hearings in September with a starting date probably 23 in early 1999. 24 CO-HEARING OFFICER STUBCHAER: How many hearings 25 would you estimate that this would require? CAPITOL REPORTERS (916) 923-5447 100 1 MEMBER BROWN: Excuse me, Mr. Chairman. 2 HEARING OFFICER CAFFREY: That's okay. 3 MR. O'LAUGHLIN: In response to that question, well, 4 the State Water Resources Control Board has already sent 5 out some proposed hearing dates in July and August. We are 6 hopeful that at least the four that you are going to hear 7 here today will definitely be taken up in July. 8 You will have to talk to the State Water Project 9 Contractors and others as to whether or not they would 10 envision the other settlements coming to fruition and 11 hopefully getting wrapped up into a process in August. But 12 hopefully the settlement agreements can be done in the time 13 period of July through August. That gives your staff time 14 to go in-house, get the comments, get the testimony, get 15 the proposed orders out, and get the final environmental 16 documentation out and done in support of a final order on 17 those settlement agreements. 18 After that period of time that will probably take 19 you up through October -- November or December. At which 20 time if there's other remaining issues or parties that 21 haven't been addressed through the settlement agreements, 22 we would envision a supplemental notice on a proposed water 23 right hearing. So there would be two hearings basically. 24 One, for settlement agreements. And second one for issues 25 that have not been resolved pursuant to the settlement CAPITOL REPORTERS (916) 923-5447 101 1 agreements. 2 CO-HEARING OFFICER STUBCHAER: Okay. 3 HEARING OFFICER CAFFREY: Ms. Forster. 4 MEMBER FORSTER: How many more settlement agreements 5 did you say? 6 MR. O'LAUGHLIN: We have four here today that are 7 proposed that I'm aware of. You'll hear from Mr. Schulz 8 that there are other agreements out there that are 9 proposed. How many of those will come to fruition between 10 now and when you start your hearing in July, I don't know. 11 But I will allow Mr. Schulz to speak to that. We have not 12 been involved in those discussions. 13 HEARING OFFICER CAFFREY: Question, Mr. Del Piero. 14 MEMBER DEL PIERO: The water rights hearing that you 15 envision pursuant to the San Joaquin Agreement, forget the 16 rest of them, whose water rights do you propose to be the 17 subject of those hearings? 18 MR. O'LAUGHLIN: Well, there will probably be several 19 groups that would be subject. The one is the -- 20 MEMBER DEL PIERO: Is it safe to assume that the 21 signatories to the San Joaquin Agreement at this point are 22 all prepared to have their permits, or licenses subject to 23 modification? 24 MR. O'LAUGHLIN: The San Joaquin Group Authority 25 member units, some of them will have their permits and CAPITOL REPORTERS (916) 923-5447 102 1 licenses amended to reflect what is necessary to carry out 2 the intent of the agreement. 3 MEMBER BROWN: You're talking about -- 4 MEMBER DEL PIERO: Does that mean some are not 5 prepared to have that happen? 6 MR. O'LAUGHLIN: There may not be a necessity for 7 members -- certain members within the group authority to 8 have their permits and licenses amended to meet the terms 9 and conditions of the agreement. 10 MEMBER DEL PIERO: Because they don't intend to 11 contribute water? 12 MR. O'LAUGHLIN: That is correct. 13 MEMBER BROWN: You only had four I think that was 14 going to contribute water? 15 MR. O'LAUGHLIN: No. There are actually six member 16 units who will be contributing. 17 MEMBER BROWN: Six. 18 MR. O'LAUGHLIN: There is Oakdale and San Joaquin on 19 the Stanislaus. There's MID and TID on the Tuolumne. 20 There is Merced on the Merced River. And then the San 21 Joaquin River Exchange Contractors. 22 MEMBER DEL PIERO: How -- how do we enforce the 23 contribution of funds in the event that those agencies that 24 are not contributing water choose not to as a term added to 25 their licenses? CAPITOL REPORTERS (916) 923-5447 103 1 MR. O'LAUGHLIN: We're going to enforce that 2 internally with an agreement between the parties. 3 MEMBER DEL PIERO: I understand what your intent is. 4 How does the State Board, given our responsibility, do that 5 as part of the water rights hearing? How do we 6 guarantee -- how do we guarantee performance as part of the 7 water rights ordinance? 8 MR. O'LAUGHLIN: Well, the performance under the 9 water right order is going to be conditioned upon Water 10 Code Section 1707 in making water available to Vernalis. 11 And in that situation, the performance requirements states 12 for the agreement that if any -- let's say hypothetically 13 that Merced doesn't make water available, then the other 14 member units within the agreement will step forward and 15 make water available to fulfill the terms and conditions of 16 the agreement. 17 MEMBER DEL PIERO: How does the Board guarantee that 18 happens? 19 MR. O'LAUGHLIN: I don't think you do. 20 MEMBER DEL PIERO: Okay. Thank you. 21 MR. SHORT: That concludes what we have to say this 22 morning, Mr. Chairman. Obviously, we will be responding to 23 folks that comment at the appropriate time. 24 HEARING OFFICER CAFFREY: Mr. Short, and lady and 25 gentlemen, who have joined you in participating in the CAPITOL REPORTERS (916) 923-5447 104 1 presentation, we thank you all for a thorough effort. And 2 we will now move to the comments from the other parties. 3 It is a quarter to 12. We'll see how many we can do and at 4 some reasonable time take a lunch break. 5 I'd like to start with Patrick Wright representing 6 Club Fed. Glad we got you, Mr. Wright. You've been very 7 patient. 8 MR. WRIGHT: Thank you, Mr. Chairman, and Members of 9 the Board. I am Patrick Wright, I'm here representing the 10 collective comments of the members of the Club Fed 11 agencies, particularly the Bureau of Reclamation, Fish and 12 Wildlife Service, and EPA, and the Department of Commerce 13 represented by the Management Fishery Service. 14 We do appreciate you allowing us the opportunity 15 to speak early, primarily to give us an opportunity to 16 provide an overview of where we see the negotiated 17 agreements going, and to comment briefly on some of the 18 issues that are raised by them, and by some of the other 19 NEPA and CEQA documents that have arisen as part of the 20 release draft document. 21 HEARING OFFICER CAFFREY: For the record, this is 22 also your opportunity to comment on the VAMP presentation. 23 MR. WRIGHT: That's true, I'll do that as well. 24 HEARING OFFICER CAFFREY: Please do that as well. 25 Thank you, sir. CAPITOL REPORTERS (916) 923-5447 105 1 MR. WRIGHT: Briefly with respect to the scheduling, 2 as you know that federal leadership in Washington signed a 3 joint letter earlier this week that outlined some of our 4 concerns with respect to the Board's schedule, and some of 5 the potential implications of that schedule on the CALFED 6 process, the Bay-Delta Accord, and other programs that are 7 very directly related to this process. 8 I think most important we ask that once the 9 workshops are completed, and that by that time hopefully 10 we'll have a better understanding as to the extent to which 11 these negotiated agreements are going to move forward, how 12 many there are, the support that they have, at that point 13 it would be appropriate to have us meet collectively with 14 the state, the federal agencies, the parties to best 15 determine how we can come up with a schedule that best 16 accommodates the goal of the party -- of the Board and the 17 parties to both accommodate those negotiated agreements, 18 but also to move together expeditiously. 19 I'm somewhat confident that once we have the 20 opportunity to do that, once we see all the agreements in 21 front of us, once we see all the other schedules that we've 22 got to accommodate what we'll be able to come up with. The 23 challenge is going to be accommodating the balance between 24 moving quickly and accommodating the agreements, 25 accommodating the public review process that Mr. Del Piero CAPITOL REPORTERS (916) 923-5447 106 1 mentioned. It's going to be quite a challenge to do all of 2 that without a very, very extended hearing process, but 3 we're certainly committed to meet with you, with the 4 parties to try to figure out how best to accomplish that 5 process in a way that it doesn't interfere with our other 6 program commitments that are also important that need to 7 move forward. 8 Now, with respect to the agreements themselves, 9 and particularly the San Joaquin River Agreement, I'm not 10 going to dwell at length on those agreements, as we 11 participated with some of the federal agencies in the -- in 12 the presentation that you just heard. I do want to 13 emphasize a couple of points, though. One is that some of 14 the individual agencies that are involved in the Club Fed 15 effort will be commenting more specifically on those 16 agreements as we move through the process. 17 I want to emphasize, however, that as of today the 18 federal agencies are not at a point we're ready to endorse, 19 or not endorse any of the negotiated agreements. We have 20 not -- with the exception of the San Joaquin River 21 Agreement, we have not been directly involved in those 22 negotiations. So we felt it was more appropriate to sit 23 through the couple days of hearings, to review those 24 agreements more thoroughly before we endorse those, or 25 suggest further modifications that need to be made. CAPITOL REPORTERS (916) 923-5447 107 1 And so instead we focused our preparation for 2 today's hearings on developing a set of criteria that we 3 thought would be useful for the Board and for the parties 4 to use in evaluating the various negotiated agreements that 5 are under development. I won't go into any of those in any 6 great detail. They're in our comments, but they involve 7 basically 11 criteria. Starting with ensuring, obviously, 8 that the 1995 Bay-Delta Water Quality Control Plan 9 agreements are fully complied with. 10 That we begin to restore some equity to the 11 projects by reducing the current scope of their 12 responsibility; thirdly, that they enjoy the support of a 13 sound legal and technical foundation, as you've just heard 14 with respect to the San Joaquin agreement; that they 15 promote water contributions from an expanded number of 16 tributary watersheds; fourth, that they provide a 17 comprehensive resolution of the contribution issue in the 18 entire watershed to the Sacramento River, San Joaquin 19 River, or one of the tributaries. This is a really crucial 20 point and one of the things that made the VAMP a success 21 and the reason it got expanded into the San Joaquin River 22 Agreement is you get lost very quickly when you're dealing 23 with any individual tributary into how they fit in with all 24 the other parties that are on that tributary in that 25 watershed. CAPITOL REPORTERS (916) 923-5447 108 1 So the Bureau of Reclamation, in particular, wants 2 to make sure that any negotiated agreements are developed 3 with a broader view in mind, not only with how they relate 4 to other parties in the watershed, but how they relate to 5 how the projects are operating to try to meet the Accord 6 standards. 7 Sixth criteria is that they contribute at least 8 new wet water that was not flowing into the Delta and not 9 paper water that doesn't provide any new benefits. Seven, 10 that they be fair and equitable to all concerned. Eighth, 11 that they are applied consistently through the full range 12 of standards in water year types and don't focus on just 13 certain water year categories. 14 Ninth, that they allow for potential changes in 15 the State Water Board's water quality objectives. You have 16 to keep in mind that there is a review process that must be 17 respected. And so hopefully, as with the San Joaquin River 18 Agreement, we'll find ways of making sure that flexibility 19 is maintained. 20 Tenth, to recognize that other processes are 21 independent of the Board's consideration. Those processes 22 such as FERC requirements must be addressed to some extent, 23 but also must be considered independent of the Board's 24 process. And, eleventh, consider the fishery impact in 25 those particular streams at issue to make sure that those CAPITOL REPORTERS (916) 923-5447 109 1 impacts are addressed. 2 Now, again, with respect to the San Joaquin River 3 Agreement itself, I'll -- I'll simply make a couple of 4 brief comments. One, that is an agreement that the 5 Department of Interior particularly has been deeply 6 involved in. The two interior agencies, the Fish and 7 Wildlife Service and the Bureau of Reclamation, have signed 8 the statement of support for the agreement. And if the 9 NEPA analysis supports implementation, then those interior 10 agencies do intend to execute the agreement and work 11 towards full implementation. 12 I do want to emphasize, however, that while 13 getting to this point has been a major, major milestone, we 14 take the Board's public process and the NEPA review process 15 very seriously. And for that reason we've got to be 16 prepared to deal with any issues that arise in both this 17 process and the NEPA review process. Keep in mind that one 18 of the reasons we had to go through this process is that 19 there were a group of folks that felt like they did not 20 have adequate due process when the Accord was negotiated. 21 We do not want to make that mistake again. 22 So, again, as important and as productive a 23 milestone as it is to facilitate the Board's process, it's 24 not a substitute for the Board's process, or the NEPA 25 review process. And on that -- on that same point, I think CAPITOL REPORTERS (916) 923-5447 110 1 the Board itself needs to very carefully review the 2 documents and the provisions that relates to its exercise 3 of authority. It's already come up a couple times this 4 morning with respect to regulatory backstop issue, with 5 respect to the extent to which water rights will be or 6 won't be conditioned, so the decision that the Board makes 7 on this agreement will be a major precedent for all future 8 agreements for quite some time. So, certainly, the Board 9 itself needs to weigh in on the extent to which it's 10 comfortable with the provisions in this agreement and 11 others that relate to its own exercise of authority. 12 Now, briefly with respect to some of the other 13 CEQA/NEPA issues that have arisen, we thought it was 14 important to say a few words about those so folks that are 15 negotiating agreements keep those in mind, how the 16 agreements relate to issues such as implementation of the 17 narrative objectives for the Suisun Marsh and for the 18 salmon protection that are also a part of the Accord and 19 part of the Water Quality Control Plan. 20 With respect to the Suisun Marsh objectives, the 21 Department of Interior attempts to provide more specific 22 comments on the preservation agreement. I just want to 23 flag that our primary concern is that any implementation 24 plans that are developed, or negotiated agreements that are 25 reached, be established to protect the full range of CAPITOL REPORTERS (916) 923-5447 111 1 species and habitats that require protection under those 2 narrative criteria. 3 Similar point is true with respect to the doubling 4 criteria. We want to make sure that any negotiated 5 agreements that are developed are developed with an eye 6 towards how they fit in the with the strategy to try to 7 meet our doubling goals. As you recall, the mandate that's 8 in the Accord and the Water Quality Control Plan is that 9 the standards together with the other measures in the 10 watershed are supposed to achieve a doubling. So we think 11 that it's an important consideration for the Board to keep 12 in mind to the extent to which those agreements are 13 consistent with that mandate. 14 And finally a point with respect to the EIR 15 evaluation of both the agreements, the joint point of 16 diversion, and other issues that are before the Board. One 17 of our concerns is that the CEQA documentation may not 18 accurately reflect some of the most recent developments 19 that have occurred in the California water management, such 20 as the recent policy announcement by the Department of the 21 Interior under B2. I realize that when you've got such an 22 extended process, it's difficult to keep up with when the 23 baseline for your analysis keeps changing. For that reason 24 we are not suggesting that you change your no-action 25 alternative, but we need to figure out some way, CAPITOL REPORTERS (916) 923-5447 112 1 collectively, to communicate to the public and the 2 stakeholders how these agreements, how the joint-point 3 alternatives would change environmental conditions and 4 change the water supply conditions above and beyond today's 5 conditions as opposed to the baseline conditions that were 6 evaluated as part of the document. 7 So, again, that's something we hope you and the 8 parties will keep in mind as they negotiate the agreements 9 and as we move together as part of the Board's process. 10 That concludes our comments. Again, I thank you for 11 allowing us to speak early to provide some overview 12 comments. And we certainly look forward to working with 13 you and the parties to make this process a success. 14 HEARING OFFICER CAFFREY: Thank you, Mr. Wright. I 15 got your letter. I want to acknowledge your trepidation 16 about the length -- the potential length of the process. I 17 want you to know we share your concern. We want to get 18 this done, this dispatched. I'm not sure there's any 19 alternative that -- if this works out as it's envisioned by 20 some of the parties, and I can't say it will or it won't, 21 but if it works as some envision, it may turn out that -- I 22 don't know if I'd be able to prove it, that it was actually 23 shorter than a full-blown adversarial process. I guess 24 nobody will ever know that answer to that for sure, but 25 that's certainly what we're attempting to do here. Whether CAPITOL REPORTERS (916) 923-5447 113 1 or not we'll be successful, we'll find out in the weeks and 2 months to come. 3 And it is our intention to protect the Delta under 4 the plan that we developed in 1995 as best we can and to do 5 that with all dispatch. So we look forward to working with 6 you, certainly our staff, to work with you on some of these 7 questions that you've raised. Thank you. 8 MR. WRIGHT: Thank you. 9 HEARING OFFICER CAFFREY: Let me announce that this 10 is an appropriate time to take lunch, since it's about 11 noon, we'll come back at 1:00. Let me read a few of the 12 names of the speakers that we will go to next and then 13 Mr. Stubchaer has a brief announcement, also. 14 We have -- some of these are people that have 15 already presented, but they may be here representing also 16 in other capacities. Alf Brandt, Al Lilly, David Sandino, 17 Bill Loudermilk, Jim White, Frank -- I believe it's 18 Wernette. I apologize in advance if I mispronounce 19 anybody's name. These are all people from the Department 20 of Fish and Game, by the way, Nancee Murray. Then we have 21 Steve Macaulay, Tom Graff, David Schuster, Michael Sexton, 22 Cliff Schulz. 23 That's about a third of the cards, Gary Bobker, 24 Thomas Shephard. That's about, oh, I'd say, a third of the 25 cards. So there are a lot of cards, there's about 35 to 40 CAPITOL REPORTERS (916) 923-5447 114 1 cards and that's the order that we'll take them when we 2 come back. So you have an idea. 3 Mr. Stubchaer, you're announcement, sir. Please 4 bear with us for a moment. Stay in your seats, folks. 5 CO-HEARING OFFICER STUBCHAER: Mrs. Loudon asked me 6 to announce that staff is going to prepare a list of the 7 exhibits that the Board has received, not necessarily those 8 that you brought to the meeting today. And after lunch -- 9 the list is ready now. And you can see if your exhibits 10 are on this list; and if not, please, bring copies for the 11 Board and the staff. 12 HEARING OFFICER CAFFREY: Thank you. 13 (Luncheon recess.) 14 ---oOo--- 15 16 17 18 19 20 21 22 23 24 25 CAPITOL REPORTERS (916) 923-5447 115 1 TUESDAY, APRIL 21, 1998, 1:10 P.M. 2 SACRAMENTO, CALIFORNIA 3 ---oOo--- 4 HEARING OFFICER CAFFREY: Please take your seats and 5 we'll resume the workshop. There seems to be some 6 confusion with a couple of folks that came up here and 7 spoke to me. I'll repeat what I said earlier. 8 After the presentation of each of the four 9 settlement agreements, we're going to go through all the 10 blue cards and see if anybody wants to comment either on 11 the process, the water rights process, or that particular 12 agreement. And, again, after every one of these 13 presentations we'll go through all the cards. So there's 14 nothing wrong saying, "Yes, I do want to comment," or to 15 say, "No comment at this time." And we'll read your name 16 again after the presentation of the next agreement. So if 17 that wasn't clear, I hope it is now. 18 And then at the very end -- Mr. Stubchaer reminds 19 me, as I said earlier, at the very end of all the 20 presentations and all the comments we will offer anybody 21 who wants to have an opportunity to make a closing 22 statement. In the interest of being fair so that if 23 somebody got up and spoke on one of the agreements and 24 heard other things later and wishes they said more, they 25 will have that opportunity. CAPITOL REPORTERS (916) 923-5447 116 1 Mr. Baber? 2 MR. BABER: Yeah, Mr. Chairman, just to understand 3 again, after each of the agreements is presented then 4 you'll go through the blue cards for comments on that 5 particular agreement? 6 HEARING OFFICER CAFFREY: That's correct. 7 MR. BABER: Not the whole process? 8 HEARING OFFICER CAFFREY: Not the whole process. 9 MR. BABER: All right. Thank you. 10 HEARING OFFICER CAFFREY: But I will -- yeah, this is 11 a workshop, and precision such as it is required in a 12 hearing is not -- is not quite as strong. But I also said 13 earlier that when people were making their presentations, 14 they could go into some general policy areas to set the 15 framework, or the context for how they got to their 16 agreement. The people who did the presentation on the 17 VAMP/San Joaquin agreement did do that. 18 Mr. Wright did a little bit of that when he came 19 up and commented. So I have to, in fairness, afford that 20 opportunity to anybody that comes up and comments on an 21 agreement, too. But in the interest of time, in the 22 interest of allowing your fellow parties to have an 23 opportunity to speak, I would ask you not to pack up your 24 presentation on all the agreements. I mean, try to keep it 25 as much as you can to the one that was just presented and CAPITOL REPORTERS (916) 923-5447 117 1 that would be helpful to all of us. 2 There's different ways of doing this. We thought 3 about hearing all the agreements at one time and then 4 letting everyone comment at the end, but we just thought 5 that this would be more in sync and a lot of people would 6 get a lot of stuff off their chest, especially if we allow 7 you, again, to close on all of them. So that's the 8 thinking. Any other questions while we -- 9 MR. BABER: Thank you, Mr. Chairman. 10 HEARING OFFICER CAFFREY: Thank you, Mr. Baber. With 11 that, then I would go through the cards. I read about a 12 third to a half of them before we left. We heard from 13 Mr. Wright. We appreciate his comments. And now we are at 14 the point where we will hear from Mr. Brandt, if he wishes 15 to comment on the -- 16 MR. BRANDT: I'm waiting until Mokelumne. 17 HEARING OFFICER CAFFREY: All right, sir. 18 Alan Lilly. 19 MR. LILLY: No comment on the San Joaquin Agreement. 20 Thank you. 21 HEARING OFFICER CAFFREY: Thank you. By the way, 22 please, don't feel compelled to stand up, we appreciate the 23 respect, but just holler out "no comment," and that's fine. 24 Only if that's your intention. If you wish to speak, then 25 just come right forward. CAPITOL REPORTERS (916) 923-5447 118 1 MR. BOBKER: Don't you want to make sure the right 2 person is hollering "no comment"? 3 HEARING OFFICER CAFFREY: Mr. Bobker, you're always a 4 little smarter than me. Very good point. But we wouldn't 5 fingerprint anybody. All right. Okay. David Sandino, 6 comments on the VAMP? Good afternoon, sir. And welcome to 7 you. Mr. Sandino is representing the State Department of 8 Water Resources. 9 MR. SANDINO: Good afternoon, Mr. Chairman, and other 10 Board Members. The Department has a few brief comments 11 about the VAMP. The Department has been involved with the 12 development of the San Joaquin River Agreement. And we 13 support it as a study program to shed some light on the 14 uncertain relationship of river flow and project diversions 15 of the San Joaquin fish; and also to confirm a barrier at 16 the Head of Old River. 17 At the same time, we are aware that VAMP is one of 18 eight measures in the November 20th, 1997, Department of 19 Interior plan to implement part of the Central Valley 20 Improvement Act. The Department is concerned that the 21 implementation of the other measures in the November 20th 22 plan will result in adverse impact on water users, or 23 rather further adverse impacts. 24 We have already seen the State Water Project 25 sustain a large reduction in water supply over the past few CAPITOL REPORTERS (916) 923-5447 119 1 years from the 1994 Accord. The Department believes that 2 the concerns raised by the November 20th plan, of which 3 VAMP is a key part, needs to be addressed in the spirit of 4 getting better together. The Department has been working 5 to find a way to develop a multi-year operation plan to do 6 just this, to make the November 20th plan work. We have 7 been talking with federal agencies; and we have recently 8 distributed a draft operation plan to the Club Fed 9 management team in an attempt to resolve this issue. 10 We do want to emphasize that the Department 11 supports the VAMP and the VAMP implementation plan. And 12 the Department hopes to be able to sign on the VAMP very 13 soon, but we believe it is important that the Board know 14 our position that we still have several issues to resolve 15 before the Department is signatory to the plan. 16 As a final point -- as a final point, the Board 17 will be hearing again later in the workshop about the 18 Interior South Delta Agriculture Barrier settlement. As 19 you are aware, the Department has made several 20 presentations previously to the Board on the settlement 21 agreement between the Department, the Bureau, and the South 22 Delta Water Agency to implement the Interior South Delta 23 Agriculture objectives. We also want to emphasize, too, 24 that VAMP refers to the agricultural barriers as possibly 25 needed to mitigate the impacts on the irrigation users CAPITOL REPORTERS (916) 923-5447 120 1 caused by the Old Head of the Barrier. That concludes the 2 Department's statement on the VAMP. 3 HEARING OFFICER CAFFREY: Thank you very much, 4 Mr. Sandino. I assume you'll be here to comment on 5 others -- 6 MR. SANDINO: Yes. 7 HEARING OFFICER CAFFREY: -- as we proceed? 8 MR. SANDINO: Yes. Thank you. 9 HEARING OFFICER CAFFREY: We appreciate your 10 comments. Are there any questions of Mr. Sandino? Okay. 11 Thank you, sir. 12 MR. SANDINO: Thank you. 13 HEARING OFFICER CAFFREY: I believe that we have a 14 number of individuals from the Department of Fish and Game. 15 And I was told just after we took the lunch break that 16 there might be a panel discussion. Is that correct? I 17 have Bill Loudermilk, Jim White, Frank Wernette, if I've 18 got that correctly, and Nancee Murray. 19 MS. MURRAY: Yes. 20 HEARING OFFICER CAFFREY: Good afternoon, Ms. Murray, 21 welcome. 22 MS. MURRAY: Good afternoon. We will not be doing a 23 panel discussion; we'll go with the flow of this hearing as 24 it is set up. And we will speak one after the other on the 25 agreements. CAPITOL REPORTERS (916) 923-5447 121 1 HEARING OFFICER CAFFREY: Okay. 2 MS. MURRAY: But what I would like to request, we did 3 put in the four cards for the four speakers, if we can kind 4 of put those together and at the end of each one call the 5 Department, and we will have that person who is going to be 6 speaking on that particular agreement come up. 7 HEARING OFFICER CAFFREY: Sure. 8 MS. MURRAY: And for your information, I will be 9 discussing the phasing of the hearing and I'll be doing 10 that at the end, at the closing stage. Mr. Bill Loudermilk 11 will come up next to discuss the Vernalis Adaptive 12 Management Plan. And Mr. Jim White, of our Environmental 13 Service Division, will be discussing the Yuba and the East 14 Bay MUD Agreement. And Mr. Frank Wernette of our Bay-Delta 15 Division will be discussing the Suisun Marsh Preservation 16 agreement. 17 HEARING OFFICER CAFFREY: That's very helpful. We'll 18 keep the cards together. I don't know if I'll remember all 19 that, but I'll call for the Department of Fish and Game and 20 hope for the best. 21 MS. MURRAY: Right, and sorry for the confusion. And 22 next up is Bill Loudermilk. 23 HEARING OFFICER CAFFREY: Thank you, Ms. Murray. And 24 this is Mr. Loudermilk. Good afternoon, sir, and welcome. 25 MR. LOUDERMILK: Good afternoon, Mr. Chairman and the CAPITOL REPORTERS (916) 923-5447 122 1 Board. I, as Nancee indicated, work for the Department out 2 of the Fresno office leading the Department's anadromous 3 fish restoration effort in the San Joaquin basin. And I've 4 been quite active in the earlier phases of this proceeding 5 since 1987. My comments today focus on several components 6 of water principle issues of the Vernalis Adaptive 7 Management Program. And there are four components to the 8 VAMP documents as we now understand them, and we heard 9 earlier today: 10 The statement of support, which our Department is 11 signatory to; the San Joaquin River Agreement, a conceptual 12 framework which represents Appendix A, the study program; 13 and then Appendix B, which is planning operation and 14 detail. We continue to participate both at the policy 15 level and at the technical level in refinements of the VAMP 16 document, the VAMP agreement. 17 It's our understanding that this is -- that these 18 four documents represent the sum total of documents that 19 may comprise an additional alternative component to be 20 evaluated by the Board along with existing alternatives in 21 the Draft EIR. You've already heard much about the 22 projects of VAMP, I will not repeat most of that. I would 23 like to point out that many of the comments that we 24 provided previously on the draft environmental documents 25 are also pertinent to the VAMP alternative in the event CAPITOL REPORTERS (916) 923-5447 123 1 this is evaluated in the revisions to your DEIR. 2 Today my comments focus on a very few key aspects 3 and the VAMP Agreement and the appendices where the 4 Department has their main concerns. The primary areas of 5 concerns to the Department are: 6 The integration of the VAMP flow scheduling and 7 monitoring with San Joaquin Basin tributary survival 8 studies and the timing of natural fish migrations to obtain 9 the necessary and valid study results. 10 The second item, the consideration with the 11 distribution of natural salmon production among the 12 tributaries when adaptively identifying the water supply 13 sources to meet the pulse flow objectives of Vernalis to 14 help meet the narrative doubling standard. 15 Third, the concept of minimizing the possibilities 16 of genetic impacts of proposed San Joaquin Delta studies by 17 avoiding the use of out-of-basin salmon smolt in VAMP 18 studies and other studies in the South Delta. 19 Fourth, the inability to meet large and growing 20 demands for salmon smolts for studies in the tributaries, 21 San Joaquin tributaries and the San Joaquin Delta referring 22 to VAMP Old River Barrier studies on a consistent basis and 23 reliable basis with a high-quality test fish from only the 24 Merced fish hatchery, there's a limitation there. 25 Fifth, the need to avoid deferring the issue of CAPITOL REPORTERS (916) 923-5447 124 1 low-summer carryover storage and lethal water temperatures 2 in the designated salmon spawning area on the Stanislaus 3 and Merced rivers. And finally, sixth, the need for 4 careful evaluation of the benefits associated with the 5 design and operations of the Head of Old River Barrier. 6 The integration of the monitoring efforts proposed 7 under VAMP with the similar tributary -- with similar 8 tributary programs and monitoring of natural fish migration 9 patterns relative to the magnitude -- magnitude of 10 migration is crucial to obtain the most useful results over 11 the next 10 to 12 years. These annual monitoring programs' 12 performance upstream of the Delta should be performed 13 simultaneously with the VAMP study in order to develop 14 timely and effective long-term protective measures for 15 chinook salmon throughout their migration age. 16 The net survival benefit, the overall survival 17 benefit to each year class of salmon is really the product 18 of the survival rates in the tributaries along the main 19 stem and through the South Delta. The integration of 20 tributaries main stem and San Joaquin study efforts could 21 optimize our collective understanding of the need for 22 salmon throughout the San Joaquin system within the VAMP 23 time frame. We consider this to be consistent with the 24 adaptive management strategy and believe it will give us 25 the ability to define measures that help meet the narrative CAPITOL REPORTERS (916) 923-5447 125 1 objective of doubling salmon production. 2 Regarding the methods and sources of tributary 3 water over the VAMP study, it's our desire that under an 4 adaptive water management approach the water be released 5 from the source tributaries in a manner that best reflects 6 the distribution of natural salmon production in the basin. 7 For example, if most of the fish fall in one tributary 8 improved conditions, there should be high priority along 9 with improvements elsewhere. Where a serious condition may 10 dictate additional actions, we would also expect that the 11 discretion within the VAMP design and elsewhere be used. 12 We believe this is consistent with the flow objectives in 13 the 1995 -- 1995 Water Quality Control Plan and the natural 14 doubling standards. 15 Regarding the continued use of the Bureau of 16 Reclamation's interim operations plan for the operation of 17 New Melones Reservoir, the Department has agreed to this 18 plan only through the balance of this water year. There 19 are portions of the 1987 fish study agreement between Fish 20 and Game and the Bureau of Reclamation associated with the 21 Board's decision B-1422 that remain unresolved. The 22 Department believes these issues should be resolved 23 instead of being deferred for the duration of the 12-year 24 VAMP effort. 25 Low carryover storage at New Melones can result in CAPITOL REPORTERS (916) 923-5447 126 1 lethal temperatures during fall and incubation periods in 2 designated spawning areas on the Stanislaus River; and 3 overrelaxed on the New Melones Reservoir may perpetuate or 4 increase the frequency of this condition which is not 5 conducive to restoring this important fishery. We have 6 similar, but less well documented concerns on the Merced 7 River. 8 The use of the Head of Old River Barrier to 9 provide protection for migrating salmon fry and smolts from 10 the San Joaquin should be carefully evaluated. Results to 11 date suggest to us that such a program is worthy of 12 evaluating, but the benefits may vary dramatically 13 depending on the design and how such a facility can be 14 operated. If the barrier can be operated for the period of 15 time while San Joaquin salmon smolts are migrating, then 16 the benefits may be as high as anticipated. 17 If operational periods are truncated, the benefits 18 will be diminished. The overall effect of the narrow 19 protective periods may become anther form of genetic 20 selection providing greater protection for only those fish 21 migrating during those time windows. 22 In closing, we believe that these issues can be 23 resolved in a satisfactory manner over the next couple of 24 months. VAMP and their complementary monitoring components 25 can be refined, then these programs can be integrated to CAPITOL REPORTERS (916) 923-5447 127 1 form a strong alternative for implementing the Vernalis 2 flow objectives in the 1995 Water Quality Control Plan. 3 Thank you. 4 HEARING OFFICER CAFFREY: Thank you, Mr. Loudermilk. 5 That completes the presentation for the Department of Fish 6 and Game? 7 MR. LOUDERMILK: On the Vernalis Adaptive Management 8 Plan, yes. 9 HEARING OFFICER CAFFREY: Thank you, sir, appreciate 10 your comments. Steve Macaulay. I believe Mr. Macaulay 11 indicated that he would not be commenting on the VAMP. 12 MR. MACAULAY: Yes. 13 HEARING OFFICER CAFFREY: Tom Graff, senior attorney 14 for the Environmental Defense Fund. Good afternoon, 15 Mr. Graff. Welcome, sir. 16 MR. GRAFF: Good afternoon, Mr. Chairman and Members 17 of the Board. I'm Tom Graff, senior attorney for the 18 Environmental Defense Fund. I have with me Dan Wright, a 19 legal intern. 20 HEARING OFFICER CAFFREY: Welcome. 21 MR. GRAFF: And others at EDF, who have been 22 participants in related matters, that are before the Board 23 here today are Spec Rosecrants, David Yardis, Dr. Terry 24 Young, and Dr. Araud Phachita (phonetic). 25 This aspect of the discussion today is about the CAPITOL REPORTERS (916) 923-5447 128 1 so-called San Joaquin River Agreement; although, for more 2 of its history it was called VAMP, as we heard earlier. 3 During that time it was an agreement to approve an 4 experiment to provide pulse flows one month a year for 5 migration of hatchery-reared salmon smolt to the estuary. 6 Instead, a side comment, if it had stayed we probably would 7 have fewer objections. But as has been noted, it has now 8 been termed a San Joaquin River Agreement. And the 9 question -- one of the two major questions that the Board 10 posed was: Does this agreement, the San Joaquin River 11 Agreement, have support from others? And the answer with 12 respect to the Environmental Defense Fund is, in short, no. 13 Our letter of March 23rd to former Deputy 14 Secretary of the Interior John Garamendi sets out a 15 detailed critique of the San Joaquin River Agreement. That 16 letter was attached to our letter to the Board of April 1, 17 which also incorporated comments on the Board's Draft EIR. 18 And let me read briefly from that set of comments our 19 principal concerns with the San Joaquin River Agreement. 20 "It is EDF's understanding the Board will evaluate 21 the San Joaquin River Agreement. We have reviewed this 22 agreement, and while we find some elements of the agreement 23 promising, we have significant concerns as summarized below 24 and discussed in some length in our March 23, 1998, letter 25 to Deputy Secretary John Garamendi." CAPITOL REPORTERS (916) 923-5447 129 1 Attached are comments including, A, the agreement 2 has been characterized as a panacea for the problems of the 3 San Joaquin River. The San Joaquin River has been 4 depleted, polluted, and degraded, perhaps, more than any 5 other of California's major rivers. The agreement pertains 6 to only the flow target at one point on the river during a 7 30-day period. 8 B, the criteria for determining the Vernalis flow 9 targets are based on existing flow," that's, in quotes, 10 "forecast which may prove to be ambiguously defined in many 11 years and result in serious disputes and/or lower than 12 projected flows at Vernalis." 13 In our letter to Mr. Garamendi we suggest an 14 alternative approach. "C, the agreement makes 15 inappropriate use of environmental restoration funds." 16 There's a long explanation in our letter on that point. 17 And, "D, the agreement may require construction of a 18 controversial hatchery on the Tuolumne River, the lines on 19 hatchery production can significantly diminish naturally 20 reproducing anadromous fish." 21 Now, I understand this is not the occasion to go 22 into detail on those points, so let me move to a couple 23 other comments. One, we have not yet received a response 24 either from the Deputy Secretary, nor from any others that 25 we copied on that letter, others in the federal CAPITOL REPORTERS (916) 923-5447 130 1 establishment. We did hear this morning from Mr. Brandt 2 that the Bureau of Reclamation and the Department of Water 3 Resources, as I heard him say it, are committed as a 4 backstop to the San Joaquin River Agreement to meet the 5 Board's Water Quality Control Plan obligations for two 6 years. In response to Mr. Brandt's comments I have four 7 questions. 8 One: Is the Department of Water Resources really 9 committed to that promise as well? 10 Two: Why only for two years? 11 Three: I believe he said that the Bureau of 12 Reclamation anyway, he did say DWR, are committed to 13 meeting the requirements of the Water Quality Control Plan. 14 And we would ask as we did in our comments to the Board 15 whether that includes only the specific flows at Vernalis 16 that are incorporated in the VAMP, or the narrative 17 objection for natural reproduction -- doubling of natural 18 reproduction of chinook salmon as well. 19 And, fourth, this is a little bit gratuitous but 20 I'll throw it in; will Kern County Water Agency and others 21 who have filed litigation in the Court of Claims attacking 22 the prior efforts of the projects to meet environmental 23 obligations in the early '90s file again in the Court of 24 Claims and the Bureau and DWR agree to meet these San 25 Joaquin River objectives? CAPITOL REPORTERS (916) 923-5447 131 1 MEMBER DEL PIERO: Tom didn't show up, so you can't 2 get an answer. 3 MR. GRAFF: There's others from Kern County, I'm 4 sure. Unfortunately I won't be able to return tomorrow, so 5 if I may, can I make a brief comment on the other 6 agreements and on the hearing schedule? It wouldn't take 7 me more than three minutes. 8 HEARING OFFICER CAFFREY: We will accommodate you, 9 Mr. Graff. I do have your note that you're not going to be 10 here. And we have let others such as Mr. Wright do that 11 earlier. So, please, be brief, but please do so. 12 MR. GRAFF: Thank you. 13 CO-HEARING OFFICER STUBCHAER: Before you do that, 14 Mr. Graff, what was your point A? I'm sorry I missed it. 15 MR. GRAFF: Point A was basically that this is now 16 called the San Joaquin River Agreement and it doesn't deal 17 with the whole problems in the San Joaquin River. 18 I wanted to credit, first of all, the Yuba County 19 Water Agency, Northern California Water Agency, and the 20 Metropolitan Water District for providing a briefing to EDF 21 and other environmental organizations last week on the 16th 22 on their agreement so we know a little bit more about it. 23 And we know about the other two. 24 Despite that I would say that there are major 25 concerns that we have begun to uncover on that agreement. CAPITOL REPORTERS (916) 923-5447 132 1 And I will mention them just in passing. One has to do 2 with potential restrictions in the water market that are 3 contained in the Yuba Agreement. And the other a 4 question -- a serious question, I'm sure you'll hear from 5 others, what the baseline for the Yuba River flows should 6 be. In any event, we look forward as well to future 7 hearings. 8 Brings me to the question of how should the 9 decision making proceed here before the Board. Overall, 10 EDF does not believe bifurcated decision making based on 11 negotiated agreements is appropriate. We agree with the 12 federal government's position recently articulated that you 13 should move as quickly as possible to a final overall 14 decision on water rights. 15 We do have an alternative -- I would say a 16 positive suggestion for how to structure order of 17 presentation. And it is as follows: 18 Without giving -- going through a detailed review 19 of each of the water rights and water diversions in the 20 watershed, the Board could request briefing on legal issues 21 regarding what the obligations are of water users 22 throughout the watershed to meet the water quality control 23 standards set in the plan. Basically on the one hand, one 24 could take the view that the junior right holders, who are 25 the diverters of state and federal projects, hold the CAPITOL REPORTERS (916) 923-5447 133 1 principal, if not the only responsibility, for meeting 2 those standards as the historic priority water right system 3 in California might suggest. Or on the other hand, that 4 all the depleters in the watershed have a correlative 5 obligation of some kind as -- at least indicative of the 6 Racanelli decision seems to suggest. 7 If the latter is the case, then the Board would 8 have to go a little further, I would think, in finding or 9 investigating whether there are distinctions between kinds 10 of diverters per entry 314, whether the Delta protections 11 and/or water right statutes have a bearing and so on. 12 What I think would be constructive, then, would be 13 for the Board to set out its view on what is legally 14 required before going into detailed and factual 15 investigations, perhaps. And also if -- well, in addition, 16 if in the Board's opinion the best public policy is not 17 what is legally required to also offer that public policy 18 view as well. No doubt some would object. Inevitably some 19 would object and probably litigate whatever decision the 20 Board would reach. But in EDF's view, if any aspect of 21 this proceeding should get precedence, this approach rather 22 than hearing a number of partial and negotiated agreements 23 by a limited number of parties is the best way to proceed. 24 Thank you. 25 HEARING OFFICER CAFFREY: Thank you very much, CAPITOL REPORTERS (916) 923-5447 134 1 Mr. Graff. In view of the fact that we won't have you here 2 tomorrow, let me check and see if any of the Board Members 3 have any questions from you at this time. Anything from 4 the staff. 5 Ms. Leidigh, our counsel. 6 MS. LEIDIGH: I just had a couple of questions about 7 your last suggestion which seemed a little bit interesting. 8 If there were litigation after a ruling such as you 9 suggest, do you think that the litigation would be ripe at 10 that point, or do you think that the Board would be able to 11 complete its proceeding and reach a decision before 12 litigation options were available to the parties? 13 MR. GRAFF: That's a very good question. And I don't 14 have a good answer. I could have thought about the 15 question beforehand, it's remarkable. I would say that the 16 Board would be under an obligation to assure that the 17 standards be met in the interim. And I suppose it would be 18 a question of first impression whether in some sense the 19 Board could certify such an interlocutory decision in legal 20 jargon appropriately. 21 I think even if it couldn't and even if litigation 22 were premature, I think it would be very helpful to 23 everyone involved in the water world, the stakeholders, the 24 agencies, state and federal, and legislation and the 25 congress to know what the Board thinks state law is on this CAPITOL REPORTERS (916) 923-5447 135 1 point. Because I think one of the reasons we have so much 2 uncertainty at the moment is that even for these 3 negotiators who have talked about all the hours that 4 they've put into these attempts to reach agreement, the 5 main point is they don't know what the law is, or even what 6 the Board thinks the law is. 7 MS. LEIDIGH: Okay. How would you handle the problem 8 that you often have with determinations of law that facts 9 have a tendency to dictate what result comes out when you 10 apply the law? 11 MR. GRAFF: That's another good question. I would 12 say that the lawyers here are plenty creative in presenting 13 facts in their briefing to give you at least a pretty good 14 grounding in what -- in what the underlying facts are. 15 And -- and you will hear conflicting views, I'm sure. 16 But that's -- that's a -- anytime you bifurcate, which I 17 suppose is my basic point, you run that risk. And that 18 would be a problem. 19 MS. LEIDIGH: Okay. That's all the questions I have. 20 HEARING OFFICER CAFFREY: Thank you, Ms. Leidigh. 21 MR. GRAFF: Thank you. 22 HEARING OFFICER CAFFREY: I thank you, Ms. Leidigh. 23 Thank you very much, Mr. Graff, for your joining us today, 24 appreciate your input and thanks to your young companion. 25 Dave Schuster? CAPITOL REPORTERS (916) 923-5447 136 1 MR. SCHUSTER: No comment. Thank you, sir. 2 HEARING OFFICER CAFFREY: Michael Sexton? 3 MR. SEXTON: No comments on the Vernalis Agreement. 4 HEARING OFFICER CAFFREY: No comment. Cliff Schulz? 5 MR. SCHULZ: Been there done that. 6 HEARING OFFICER CAFFREY: Been there done that, thank 7 you, sir. Gary Bobker? 8 UNIDENTIFIED MAN: No comment. Years of training, 9 years of training. 10 HEARING OFFICER CAFFREY: I knew where he was sitting 11 and I read his lips and they didn't move. Good afternoon, 12 Mr. Bobker. Welcome, sir. 13 MR. BOBKER: Thank you, Mr. Caffrey. Members of the 14 Board, Mr. Chair, my name is Gary Bobker, senior policy 15 analyst at the Bay Institute of San Francisco. I want to 16 comment on the -- on the San Joaquin River Agreement from 17 the perspective of a party that was intimately involved in 18 those negotiations for about 18 months. And as a matter of 19 fact, the real reason we're reluctant to support the 20 agreement is it would commit us to meeting with Alan and 21 Tim and all these guys for 12 years, and that's just a very 22 fatal future to contemplate. 23 HEARING OFFICER CAFFREY: There's your penalty, 24 Mr. Bobker. 25 MR. BOBKER: You could look at this as one of the CAPITOL REPORTERS (916) 923-5447 137 1 conditions of the water rights permit. 2 MEMBER DEL PIERO: They finally admitted it on the 3 record. 4 MR. BOBKER: On a more serious note, I would say that 5 18 months has not been without some reward in that we've 6 seen the agreement go from what was a very unacceptable, 7 weak partial interpretation of the 1995 Water Quality 8 Control Plan into the agreement which you see today, which 9 in many ways provides an adequate framework for interim 10 management for the San Joaquin River. 11 Having said that, I want to start out by saying 12 that at this time having put all that time into the 13 negotiation, we're not able to support the agreement, 14 because of one particularly grievous outstanding issue. 15 And that is the use of CVPIA restoration fund monies as the 16 primary funding vehicle. 17 Funds like the restoration fund, or other 18 ecosystem restoration funds which are precluded from any of 19 this, are intended to augment baseline conditions that 20 exist in the rivers. They're additive, that's what they 21 are there for. We need them desperately. And it's 22 inappropriate from both a legal and policy standpoint to 23 use those funds to comply with the baseline requirements of 24 regulatory statutory baseline requirements that offer us 25 the definition of what baseline conditions are. CAPITOL REPORTERS (916) 923-5447 138 1 So we -- we oppose the use of restoration funds. 2 We think the Board should consider other alternatives 3 including the establishment of water user fees. There are 4 other potential public fund sources as well. In any case, 5 the Board should condition its approval of any version of 6 this agreement on use of funds not otherwise intended for 7 environmental restoration purposes. 8 I will say that in, you know, the good faith 9 spirit that we've been working on in the negotiations, we 10 intend to work with the San Joaquin River Group exporters, 11 and federal and state agencies to try to identify and 12 secure alternative sources in funding so that in the end we 13 have acceptable vehicle -- funding vehicle and we will be 14 able to support the agreement and intend to become a 15 signatory at that time. 16 The issue of funding aside, I think it's really 17 important to understand -- you know, as Mr. Graff was just 18 saying, it's possible to interpret the agreement as things 19 it perhaps isn't. So it's good to understand what it is 20 and isn't. I'll give you at least the basic view of what 21 it is and what it is not. 22 First of all, it's an interim agreement. It's a 23 12-year agreement in which the projects have agreed to 24 fund -- to provide funding to upstream users to fund -- 25 essentially to reoperate and to fund official water CAPITOL REPORTERS (916) 923-5447 139 1 management programs which allow them to assist the projects 2 in meeting compliance obligations which the projects agree 3 to backstop. The ultimate compliance responsibility rests 4 with the projects and are asking to take the State Water 5 Board order, which we think is going to look like something 6 like a 95-6, which is an interim water rights order 7 modifying water rights and conditions, but with a sunset, 8 not a permanent open-ended order. And I think some of the 9 questions that Board Members have asked about the nature of 10 that order you're going to have to find a right order that 11 is allowed to enforce the agreement, if the agreement or 12 some version of the agreement is acceptable. 13 Secondly, as you've heard a lot about this is, 14 unlike the original letter of intent, this is a much more 15 full-protected regime. And what we think -- you have to 16 think of it not just as flow, but flows and exports; flows 17 based on water year type, and exports with very high 18 permitted levels in the '95 Water Quality Control Plan. 19 Instead what we have here are flows based on some of the 20 more complicated hydrological approaches than the water 21 year type and much more stringent export criteria. The two 22 of them together plus the barrier operation, I think it's 23 reasonable to conclude, and we hope you will find after 24 your evaluation, that they are equivalent, equivalent level 25 of protection. It's important to remember that those CAPITOL REPORTERS (916) 923-5447 140 1 export criteria have to be met, or else the equivalency and 2 protection is not achieved. 3 You've heard a lot about the adaptive management, 4 or experimental nature of the experiment, that's really 5 important. We think that there's plenty of information to 6 justify your adoption of San Joaquin River flow criteria at 7 Vernalis in the '94 plan, but we think there's a need for 8 more information considering there is limited data on the 9 San Joaquin. There is a lot of controversy. And in terms 10 of allocating the responsibility over the longer term for 11 compliance with those standards it would be better -- it 12 would be good to have a better handle on the relevant 13 impacts of flows, exports, and barrier operations. 14 Finally, what I think is important in terms of 15 understanding what the arrangement is, it's an arrangement 16 to fund the fish and water use management. The Merced 17 Irrigation District knows -- they're looking at maybe some 18 conjunctive use projects and other things that will allow 19 them to much more flexibly manage their system. And that's 20 important because this is not a permanent agreement. It's 21 an interim agreement. And when it ends I imagine the 22 funding stream is not going to be there forever. And we 23 are going to have to go back and look at longer term 24 compliance, but I believe the upstream users will be in a 25 much better position to mitigate some impacts of them CAPITOL REPORTERS (916) 923-5447 141 1 complying with San Joaquin River objectives. 2 Having said what the agreement is. Let's me 3 emphasize what it isn't. It isn't a permanent resolution. 4 You know, there's still fundamental disagreements over the 5 compliance obligations of the various parties. But if we 6 have better information about the relevant impacts of these 7 factors, if we have greater water management flexibility, 8 that will I think help us in the conversations we have down 9 the road after this agreement expires. We continue to 10 support, as we noted in our comments over the draft ERI, a 11 modified version of the flow alternative fund as a 12 long-term approach, but believe that it may be appropriate 13 to defer implementing something like that until after the 14 agreement expires. 15 The second thing that this agreement is not is a 16 comprehensive arrangement to implement the narrative 17 objectives to salmon protection throughout the San Joaquin 18 Basin. That's really important. This agreement is 19 intended to contribute to the narrative objective by 20 improving conditions of flow export and barrier operation 21 during the pulse-flow period for salmon. To that extent 22 it's a good thing. But there are probably lots of other 23 measures that affect -- affect salmon production through 24 the basin. And the Board needs to look at that. 25 And one of the concerns that you heard from Tom CAPITOL REPORTERS (916) 923-5447 142 1 Graff that we wrote about a lot in our comments, and I 2 think you'll hear from other environmental groups, is that 3 we want to make sure that even if we reach agreement in 4 whatever form on implementation of the numeric objectives, 5 Vernalis flow objectives there's a whole other range of 6 issues involved in the narrative protection. And there 7 are -- there's a lot of information about measures to 8 achieve salmon doubling throughout the watershed. And the 9 Board absolutely needs to consider those both in the 10 context of the water rights proceedings as well as 11 associated proceedings, perhaps, upstream. 12 Because this isn't a comprehensive arrangement on 13 salmon doubling, what this doesn't do is substitute for 14 some of the obligations that upstream water users may have 15 upstream such as Section 5937, or the public trust, that's 16 pretty important in light of the fact that some parties, 17 like Friant, do not directly contribute. 18 Finally, another comment on what the agreement is 19 not, in light of some of the comments that you heard from 20 the Department of Fish and Game, the agreement is a 21 nondirect specification for provisional hatchery facilities 22 in the San Joaquin Basin. There's been some major 23 disagreement about that. The agreement is neutral as to 24 the source of the hatchery fish to conduct the salmon smolt 25 studies. And we believe that the preferred approaches that CAPITOL REPORTERS (916) 923-5447 143 1 will emerge include re-prioritization of the use of 2 existing, the currently available hatchery fish or expanded 3 operations of the hatchery facilities that currently exist 4 in the basin. And this is something that would have to be 5 worked out in a separate form. The agreement should not 6 attempt to dictate additional facilities. 7 I would like to note also that while the Bay 8 Institute made every attempt to inform and involve the 9 broader environmental committee, that we did not directly 10 represent those groups, many of whom had a lot of other 11 things on their plate as well. And while I think that 12 water users made good-faith attempts to try to deal with 13 issues that were communicated to them, they were not as 14 intimately involved and they did not sign off on any of the 15 components. I think it's important to just understand that 16 in terms of understanding the involvement of other 17 environmental groups. 18 If I may, I'm going to be at some of the same 19 meetings as Thomas tomorrow, so I won't be able to be here 20 tomorrow either. And I wonder if I could make some very 21 brief comments on the other agreements as well. I'll try 22 to keep it to a moment or two. 23 HEARING OFFICER CAFFREY: Go ahead. 24 MR. BOBKER: Thank you. The Yuba Agreement I think 25 is in the same state that the Letter of Intent was when we CAPITOL REPORTERS (916) 923-5447 144 1 got it in 1996. In other words, you've got a long way to 2 go. And I can tell you all about how to get there, too. 3 But let me very briefly state why I think -- a couple of 4 brief things. Number one, is that the resource agencies 5 have identified the need to improve baseline conditions in 6 the river. You've got a fairly good fishery there. We've 7 got to make sure that it isn't degraded, the Board hasn't 8 issued a decision as to the Yuba. The Fish and Wildlife 9 Service also identified that need in their AFRP, we think 10 you need to identify what the necessary baseline conditions 11 are before we start having agreements that we'll transfer 12 water out of the basin. 13 Secondly, the agreement includes a bite at first 14 refusal over a very long period of time for the exporters. 15 Generally, it's not a good public policy, but also it might 16 have a very chilling impact, potential for water 17 acquisitions for in-stream use as have occurred in the past 18 on the Yuba, which generally are negotiated at lower prices 19 instead of for consumptive uses downstream. 20 The agreement doesn't -- hasn't done the work that 21 the San Joaquin River Agreement has in identifying who the 22 ultimate compliance responsibility for meeting Bay-Delta 23 standards lies with. That's something that a number of 24 parties have commented on. Also I think that the agreement 25 at this point they're contending the use of neg dec and CAPITOL REPORTERS (916) 923-5447 145 1 that's not at all adequate for in terms of environmental 2 documentation considering the potential impacts. 3 On the Lower Mokelumne, I'll only note that it's 4 my understanding that would essentially lock into place or 5 codify the agreements that have been made between the 6 Service and other resource agencies and East Bay MUD as to 7 desire the releases on the river, that was only with 8 in-stream flow needs in mind and not Bay-Delta. So I'm not 9 sure that adequately addresses Bay-Delta -- a Bay-Delta 10 contribution from that system. 11 Finally, on the Suisun Marsh Agreement, we're 12 still reviewing this agreement, but our main concern is 13 actually not with the numeric objective so much as the 14 narrative objective that goes along with that. There are 15 places where there may be potential conflicts between 16 things you do to implement the numeric objective and things 17 you might need to do to implement the narrative objective, 18 its very unclear at this point. We really think that any 19 decisions that the Board makes about implementing the 20 numeric objective in Suisun Marsh ought to, in short, that 21 by date certain an overall plan, ecological management plan 22 for the Suisun Marsh which addresses both the numeric and 23 the narrative objectives is developed perhaps for the next 24 review. 25 That summarizes the main points that we've CAPITOL REPORTERS (916) 923-5447 146 1 included in our written comments. Do you have any 2 questions? 3 HEARING OFFICER CAFFREY: Thank you very much, 4 Mr. Bobker. Since you won't be here tomorrow, let me ask 5 the Board if they have any questions. 6 MEMBER DEL PIERO: Where are you guys going tomorrow? 7 MR. BOBKER: It's the ventriloquist school actually, 8 where I get to imitate your voice. 9 HEARING OFFICER CAFFREY: Anything else? Anything 10 from the staff? Mr. Bobker, thank you for your time. 11 MR. BOBKER: Thank you. 12 HEARING OFFICER CAFFREY: Let's see, Thomas Shephard. 13 MR. SHEPHARD: Mr. Chairman, Members of the Board, I 14 would request that you put my card near the bottom of the 15 pile. There are a number of interests from San Joaquin 16 County here, and after they have spoken each time I may 17 have little or nothing to add which will save your time. 18 HEARING OFFICER CAFFREY: All right. Thank you, 19 Mr. Shephard. We'll put yours towards the end. 20 Hopefully -- after the last San Joaquin speaker, then we'll 21 see if you have anything to add at that point. 22 Greg Thomas. Good afternoon, Mr. Thomas. 23 Welcome. 24 MR. THOMAS: Thank you very much. Greg Thomas, 25 Natural Heritage Institute. I can be brief, because I do CAPITOL REPORTERS (916) 923-5447 147 1 have to comment on Gary Bobker's excellent presentation to 2 which we subscribe almost entirely. I simply want to say 3 that you know the point of departure for this San Joaquin 4 River Agreement was the Letter of Intent which was tendered 5 to you about two years ago. And this agreement comes along 6 way from that point. In fact, we think it comes to the 7 point where it is a viable vehicle for the State Board to 8 consider alongside which the other alternatives that have 9 already been considered in the Environmental Impact Report 10 that you prepared. 11 And I want to urge you in taking up this agreement 12 to give it plenty consideration. Echoing some of the 13 sediments that you heard from Patrick Wright today, this 14 proposal is just that. It's the product of about 20 months 15 of good faith effort by affected interests, but it doesn't 16 do your job for you. It is a proposal. It needs to be 17 subjected to environmental review. It is essential that 18 you satisfy yourself that the proposal hits its aiming 19 point, which is to provide the same level of environmental 20 benefits as the standards for the San Joaquin portion of 21 the system that are in your 1995 Water Quality Control 22 Plan. 23 In fact, you should note that this agreement is 24 conditional upon your making that finding. It doesn't 25 enter into force and effect unless and until you do so. CAPITOL REPORTERS (916) 923-5447 148 1 It's important that the parties that were at the table be 2 given ample opportunity to present their views and 3 testimony on the adequacy of this proposal. It should not 4 be viewed as a take-it or leave-it insiders's deal. And 5 ultimately if acceptable, it needs to culminate in an 6 enforceable order by the State Board so the good intents 7 get translating into actual water for the fish. 8 Let me also amplify for a moment the point that 9 Gary Bobker raised, the smelliest part of this deal from 10 the environmental standpoint surely is the proposition that 11 public funds and the funds that otherwise would be 12 dedicated to environmental restoration purposes should be 13 used to purchase this compliance water from the -- from the 14 tributary water users. 15 The reason this sticks in our craw is probably 16 obvious, but let me just explain it in terms of the chain 17 of title of water in this jurisdiction, telling you things 18 that you already know. The water in the fist instance 19 belongs to the public after all. And we have an allocation 20 system that allows that public good to be converted into 21 private property through the act of controlling it, and 22 appropriating it, and taking it out of the stream. And 23 when enough of that goes on so that the flows in the system 24 become depleted, the biology objects and the matter finds 25 itself before State Water Board for protective action. All CAPITOL REPORTERS (916) 923-5447 149 1 right. That's where we are today. 2 Now, the remedy being proposed here is that after 3 the public gives up its water for this purpose, it's now 4 required to buy it back in order to remedy a problem that's 5 been caused by excessive appropriation of the water. That 6 is a proposition and a precedent that is troubling and 7 dangerous. And that was the subject of much negotiation 8 over these 20 months. It was not, however, an aspect of 9 the problem that we were able to rectify before it got 10 dropped back into your laps. 11 So speaking for NHI, at least, we entered into 12 these negotiations in good faith. We think it has an 13 influence in making this a much better proposition than the 14 Letter of Intent based upon the expectation that we could 15 get it good enough for environmental signature. The 16 document does not, in fact, become available for signature 17 until about the 1st of March 1999 after NEPA and CEQA 18 compliance by the federal and state agency parties, and 19 after the State Board has satisfied the pre-conditions to 20 its coming into effect, which are specified in the document 21 as well. 22 So at that point, our sincere hope and intent is 23 to be in a position to sign-up on this deal and take the 24 intervening months to try to further address and rectify 25 this question of the source of the environmental water CAPITOL REPORTERS (916) 923-5447 150 1 purchase fund. So I'll take any questions you may have. 2 And leave it with you on that basis. 3 HEARING OFFICER CAFFREY: Thank you, Mr. Thomas. 4 Mr. Del Piero? 5 MEMBER DEL PIERO: Mr. Thomas, you participated in 6 the discussions, can you explain to me how the Board 7 enforces this as to those people that are not obligated to 8 put up water without modifying their water rights? 9 MR. THOMAS: Yeah, it's a legitimate question that's 10 probably going to require some more ventilation when we get 11 into it in substance. The set up here as you understand is 12 that the San Joaquin River Group Association is undertaking 13 a kind of a composite responsibility to provide water 14 collectively. 15 MEMBER DEL PIERO: Collectively they don't have any 16 water rights? 17 MR. THOMAS: Collectively they don't have any water 18 rights. 19 MEMBER DEL PIERO: So what we have, what they have 20 it's nice, but that doesn't mean much to me. 21 MR. THOMAS: They have an internal agreement between 22 themselves, which is to yield the water in exchange for the 23 payments. Now, we debated at considerable length in our 24 negotiations the question of Board enforceability of that. 25 The kind of compromised language that you will see in the CAPITOL REPORTERS (916) 923-5447 151 1 document is that the State Board is to write, is to issue 2 an enforceable order assuring that the obligations set 3 forth in the document will be -- will be complied with. 4 Now, short of modifying water rights, what can the Board 5 do? That's a question that I have an answer for you -- 6 MEMBER DEL PIERO: Did anyone have an answer during 7 the course of the discussion? 8 MR. THOMAS: Probably a question best put to those 9 that resisted the concept of requiring the State Board 10 actually modify the underlying water rights, of course, 11 there are -- some of the parties to this deal are parties 12 that have unpermitted water rights as well, which I'm sure 13 you appreciate, so that's a complication as well 14 MEMBER DEL PIERO: I do appreciate that. That's why 15 I'm asking the questions. Thank you. 16 HEARING OFFICER CAFFREY: Thank you very much, 17 Mr. Thomas. Does the staff have questions? Thank you very 18 much, Mr. Thomas. I appreciate your thoughts on this and 19 for taking the time to be here today. 20 Alex Hildebrand and John Herrick, joint 21 presentation, gentlemen. Are you going at it alone, Alex? 22 MR. HILDEBRAND: John will back me up. 23 HEARING OFFICER CAFFREY: He's here and if you need 24 him, you'll call you up? 25 MR. HILDEBRAND: That's right. CAPITOL REPORTERS (916) 923-5447 152 1 HEARING OFFICER CAFFREY: Oh, there he is. Good 2 afternoon, Mr. Herrick. 3 MR. HILDEBRAND: Good afternoon, I'm Alex Hildebrand, 4 Director of the South Delta Water Agency. You heard a 5 great deal about the alleged merits of this San Joaquin 6 River Management Program. Unfortunately, we have not been 7 able to reach agreement on that, largely for the reasons 8 that Mr. Stubchaer brought up this morning. 9 The fact is that the water yield of the entire San 10 Joaquin River system is overcommitted except in years that 11 we have flood releases, which we had this year and last 12 year. But we can have a long secession of years where we 13 don't have any flood releases, particularly not on the 14 tributaries that are now proposing to buy water. You get 15 quite a few out of Friant. They're not going to put up any 16 water for this deal. 17 The yield of the system is entirely consumed at 18 the point it's either exported at Friant at the south or 19 exported from Tuolumne to the Bay Area, or it's consumed 20 within the valley to primarily grow the food that the 21 growing population requires. And then some of it is used 22 for public trust purposes and some is used to -- to dilute 23 the sea line drainage that comes out of the west side CVP 24 area into the river, and in order to comply with your 25 Board's permit requirement on New Melones. CAPITOL REPORTERS (916) 923-5447 153 1 So there really is no surplus water available 2 other than flood releases, which are not predictable. Some 3 parties either ignore, or don't understand this. Others 4 believe that the shortage should be resolved in an 5 adversarial manner by taking water from some existing water 6 users and taking it away from other water users. 7 South Delta Water Agency thinks to the extent 8 possible we should provide this water requirement 9 underneath this water shortage by better multiple water use 10 and re-use of this water. And we have proposed a way of 11 doing this, which I'll allude to later. First, however, 12 let me discuss a little bit of background of what I'm 13 saying as others have done. 14 The difference between applied and consumptive use 15 of water is not well understood. In some situations 16 increases in water application efficiency increase the 17 overall availability of water, but in other cases it does 18 not. If a toilet is flushed in San Francisco the water 19 ends up in the ocean. If a toilet is flushed here in 20 Sacramento it's treated and put back into the river system. 21 All right. And in San Francisco, therefore, if you use a 22 low-flush toilet you save water. In Sacramento you do not. 23 You save some treating costs and some pumping costs, but 24 you don't save any water. 25 Now, the same thing is true relative to CAPITOL REPORTERS (916) 923-5447 154 1 agriculture. And this seems to be something that people 2 have difficulty understanding. All right. If you increase 3 the application efficiency of water in the Central Valley, 4 almost all of that -- the water that is applied in excess 5 of what the plant consumes ends up back in the water 6 system. It's not like a situation where it ends up as salt 7 in the sea, or it ends up in the ocean. 8 It's fairly obvious that if water is pumped and 9 sold from a fully utilized or over-drafted groundwater 10 basin the sale causes or exacerbates decrease water 11 availability and increase costs for other pumpers overlying 12 the groundwater basin. Same is true however of over 13 utilized, or overcommitted watersheds such as we have in 14 San Joaquin. The entire involved water supply is already 15 being beneficially used as I just mentioned. 16 Now, at these times tributary converters can still 17 capture and sell water that is beyond their -- their 18 personal needs and their district needs. However, that is 19 the water that is already being beneficially used 20 downstream at some point in time for the above purposes in 21 the absence of the sale. They just can't hold it in the 22 reservoir forever, as Mr. Stubchaer observed. Eventually 23 it comes down and serves that purpose. It may be staggered 24 in time, but unless you have another need for flood release 25 on the particular tributary served, before that happens it CAPITOL REPORTERS (916) 923-5447 155 1 is not new yield. It's some water that's taken from some 2 other user. 3 Most of the water that's needed for fish flow for 4 the control plan and for the VAMP can be more efficiently 5 supplied by a combination of water re-use by recirculation 6 of water release from the Delta/Mendota Canal and by 7 control of the time of the agricultural drainage is 8 released to the river by Salt and Mud Slough. This water 9 recirculation is substantially less expensive than water 10 purchases. This proposal was modeled by the Department of 11 Water Resources per their January 1998 report and is 12 described in the South Delta Water Agency's March 5th 13 letter to Walter Pettit and other interested parties. 14 We circulated a copy to you of that letter. I think you 15 may have seen it before. 16 The proposal complies with the 1994 Accord, does 17 not require any new facilities. And it provides the 18 desired Vernalis fish flow without taking any waters from 19 any existing beneficial use. Unlike water purchases it 20 does not achieve the new spring fish flow by reducing 21 summer flows. Now, it's true that this money that's going 22 to be paid to the tributary people is allegedly going to be 23 used for conjunctive use and other purposes. Some of those 24 may actually increase yield. But there's no commitment to 25 do that. There's no intent to reduce the consumptive use CAPITOL REPORTERS (916) 923-5447 156 1 of the water. And there's no quantification of what new 2 yield they might achieve. So we have to assume that it 3 will primarily be a reallocation of water that's now being 4 used by other parties than those who would receive the 5 payment from these flows. 6 The South Delta Water Agency believes that the 7 recirculation alternative is the most reasonable way to 8 provide the desired fish flows for the control plan and for 9 the VAMP. If those flows are provided instead by water 10 purchases on the tributaries, there's no way to avoid 11 reductions in beneficial uses at some point in time as I've 12 just said. 13 At a time of a release for fish flow one does not 14 know whether the next flood release may occur. It may be 15 followed by a drought. So you can't count on the reservoir 16 being refilled on what, otherwise, would be spilled. The 17 South Delta Water Agency believes the Vernalis fish flows 18 must be provided by the most water efficient and least 19 damaging means. Water purchases on the tributaries do not 20 meet that test. And they would also be an unjustified 21 expenditure of taxpayer funds, since the other is the 22 cheaper way to do it. 23 Productions in tributary water rights have also 24 cost to the less reasonable and unnecessary allocation of a 25 limited water supply. Furthermore, there are legal CAPITOL REPORTERS (916) 923-5447 157 1 restraints on the use of these less-efficient measures. 2 Mr. Herrick may comment on that. 3 Now, the VAMP objective is laudable. We have no 4 quarrel with the objective. In other words, to determine 5 the extent to which Vernalis spring flows for fishery 6 benefit actually reduce the loss of salmon smolts in 7 varying flow and export rates. However, the data obtained 8 over a 12-year test period may not be determinative. The 9 demonstrated restoration of the salmon run will drive, in 10 part, from the overall protection of salmon smolts from the 11 downstream migration period. 12 As Mr. Loudermilk mentioned earlier, there's no 13 way to assure that the vast majority of these smolts are 14 going to come down through a pre-selected 31-day period. 15 It's our understanding the downstream migration is spread 16 over, perhaps, as much as 90 days. It's, therefore, 17 important to minimize the loss of salmon smolts over the 18 entire period of migration. 19 Since the Head of Old River Barrier cannot be 20 operated over that entire period, for various reasons that 21 we can elaborate on, it's important to provide a 22 substantial protection of smolts that can be achieved 23 throughout the period by the use of the three tidal 24 barriers. These barriers are necessary to mitigate the 25 effect of the Head of Old River Barrier on downstream. At CAPITOL REPORTERS (916) 923-5447 158 1 other times it creates a substantial hydraulic barrier that 2 keeps most of the San Joaquin flow out of the river. And 3 consequently, keeps most of the smolts directed on down to 4 the Central Delta rather than letting them flow right over 5 to the federal pumps. 6 The tidal barrier can also be operated during 7 higher river flows than the Head of Old River Barrier. 8 That 7,000 csf figure that you heard this morning is on the 9 edge of impossibility without enormous risk. If all four 10 barriers are operated, they can also be opened when and to 11 the degree necessary to protect endangered species. This 12 will optimize the combined protection of all species. The 13 VAMP experiment will, therefore, be more effective and the 14 data will be more consistent from year to year if operable 15 tidal barriers are part of the proposal on an as-needed 16 basis. 17 A further concern with the current VAMP 18 implementation plan is that it incorporates the USBR 19 operation plan. USBR estimates that this plan would 20 violate the Vernalis salinity standard in about 40 percent 21 of the water years even without the water purchases; the 22 VAMP then proposes water purposes which would provide the 23 post 30-day flow by increasing a reduction of flow and 24 water quality at other times. 25 Proposed CVPIA water purchases would further CAPITOL REPORTERS (916) 923-5447 159 1 degrade summer flow quality. As you may know the PDIS or 2 the CVPIA proposes to buy 600,000 acre feet out of three 3 tributaries. I think that's impossible, but it shows us 4 it's a cumulative problem. You can't just look at any one 5 thing. Now, the tributary group was unwilling to let us 6 participate in developing their implementation plan for 7 VAMP until their proposal was pretty well developed. They 8 then met us with and we had cordial meetings, several of 9 them. But on December 22nd they announced that we were at 10 an impasse. We had not been provided with any later 11 developments in the plan that occurred after December. 12 This disagreement related primarily to, first, 13 whether their implementation should be tied to the Bureau's 14 current operating plan, which as we said would not meet the 15 Vernalis salinity standard; and, second, to whether the 16 recirculation should be substituted for their proposed 17 water sales. Sales, of course, would substantially profit 18 tributary groups and other districts. We regret that these 19 issues have precluded an agreement on the implementation 20 plan acceptable to both parties. 21 Well, after listening to that two-hour 22 presentation this morning I have a few additional comments, 23 which won't take two hours. First, as I understood them 24 they're saying that the adoption of a plan by the Board 25 would involve a pre-commitment by the Board to approve of CAPITOL REPORTERS (916) 923-5447 160 1 any change in place and purpose of use for the water that 2 would be taken with these purchases and removed from other 3 water uses and used for fish flow. 4 And I also understood them to indicate that 5 they -- tributary people would not take any responsibility 6 for the effect of this program on salinity, or for salinity 7 in the river system in any way. And that gets back, of 8 course, to my problem with the Vernalis plan for operation 9 for the New Melones. And since they have a one-sided thing 10 that if it takes less water they'd give up less; but if it 11 takes more the Bureau would have to put it up. Well, what 12 are we talking about again? The water out of the New 13 Melones which is terribly overcommitted already. 14 I was a little bit -- wondering what was meant by 15 this intention that we're doing a great job of maintaining 16 a steady flow this year through May. It's true that the 17 Bureau and others, in my judgment, are doing an excellent 18 job in managing the flood releases this year. But if 19 they're going to manage it so to keep flooding me until 20 May 15th, unnecessarily, then I don't see the point of 21 that. There seems to be an implication of that. 22 So I think I'll stop there expect for one thing, 23 they also seem to imply that although it didn't say so 24 directly that in order to get some of this flexibility for 25 these tests that they might be using a joint point of CAPITOL REPORTERS (916) 923-5447 161 1 diversion, and I'd like to make some comments on that. It 2 was I think referred to by one of the other speakers, I can 3 either do that now, or if you prefer I can wait and make 4 those comments later on. It would be fairly brief. 5 HEARING OFFICER CAFFREY: You might as well do it 6 now, Alex. If you are going to be brief, go ahead and do 7 it now. 8 MR. HILDEBRAND: Okay. Another issue which effected 9 parties are trying to reach agreement is: Under what 10 conditions, for what purposes should the state and federal 11 projects should be allowed to use joint point diverters? 12 South Delta believes in principal if it can be an 13 improvement in overall efficiency and it benefits the 14 fishery, if the projects are allowed to use joint point 15 diversions; however, this should not be done for purposes 16 and other circumstances that adversely impact the 17 in-channel water supply in the South Delta. 18 We accept the provision in the 1994 Accord that 19 there should be no net loss of water for the projects 20 providing water, however, that the protection of the 21 projects is there also be no net loss for diverters in the 22 South Delta. As you recall the South Delta as well as the 23 tributary people were not parties to that Accord. The 24 analyses which were presented to the Club Fed operating 25 group, or no-name group I think it was, just last week CAPITOL REPORTERS (916) 923-5447 162 1 indicate that joint point diversions would probably 2 exacerbate impacts on the South Delta. 3 The heaviest use of the joint point may be in 4 August when the South Delta is particularly vulnerable to 5 impacts from high import rates and also can be serious 6 particularly in years of low spring rainfall. If the three 7 tidal barriers are allowed to operate on an as-needed basis 8 neither the normal, nor the increased pumping resulting 9 from joint point will be a problem. However, in the 10 absence of these barriers, and we have not yet been able to 11 get permission to install when and as needed, the export 12 rates should be limited; particularly during combinations 13 of low tides, high local diversion rates, and high export 14 rates. Yet the entire barriers are not provided and 15 allowed to operate as needed much less flexibility and 16 export operations can, therefore, it be allowed for the 17 benefit of fishery. 18 Another concern is that the flexibility provided 19 by the joint point should not be used for the purpose of 20 facilitating directly or indirectly to capture and export 21 water that is first taken from San Joaquin tributaries to 22 benefit Vernalis fish flows, but which is needed for 23 Vernalis salinity control and/or for appearing for the 24 public trust protection in the summer. And as we just 25 discussed, neither of those protections is now being CAPITOL REPORTERS (916) 923-5447 163 1 assured. Water needed for these protections should not be 2 re-allocated to the fish flows unless and until the State 3 Board determines in its water rights process that this is 4 a reasonable way to provide those flows. 5 Related to this subject is an April 16th letter 6 from Mr. Potter to Mr. Patterson with a copy to Mr. Pettit 7 which was referred to in somebody else's testimony earlier 8 today. The letter proposes an operations plan in order to 9 implement the AFRP Delta actions. The sub-implementation 10 plan should include operation of the three tidal barriers 11 on an as-needed basis for several reasons. 12 First, to protect the South Delta in channel water 13 supply, as we've just discussed. Second, to protect the 14 San Joaquin salmon smolts that might migrate before and 15 after the pulse flow. Third, to provide that if varying 16 levels of salmon recovery in different years are caused by 17 changes in the numbers of migrates before and after the 18 30-day pulse flow, the variation is not to be assumed to be 19 caused by different export conditions during the pulse. 20 Fourth, to minimize the loss of smolts in years 21 when Vernalis flows are too great for operation of the Head 22 of Old River Barrier, but not too great for modified 23 operation of the downstream barriers. Those three tidal 24 barriers can do a great deal to protect the smolts at those 25 times when the Head of Old River Barrier can't be used. CAPITOL REPORTERS (916) 923-5447 164 1 And, lastly, but not at least, is to reduce the 2 salinity in the Delta/Mendota Canal. As you may recall 3 from previous testimony, if we put the barriers and operate 4 them pretty continuously, except during high flows, you 5 significantly reduce the salinity in the Delta/Mendota 6 Canal. That in turn reduces the salt load that's shipped 7 down to the CVP service area and that in turn gives us a 8 salt load that's coming into the San Joaquin that's causing 9 us all a lot of problems. 10 That's it. Thank you. 11 HEARING OFFICER CAFFREY: Thank you, Mr. Hildebrand. 12 Your comments on the joint point, we allowed them because 13 you referenced them in terms of the VAMP. Didn't mean to 14 stray too far from the scope, and hopefully we didn't, but 15 we are always pleased to hear your expertise on these 16 matters. 17 MR. HILDEBRAND: Thank you. 18 HEARING OFFICER CAFFREY: Are there questions of 19 Mr. Hildebrand from Board Members? Mr. Brown. 20 MEMBER BROWN: Perhaps, Mr. Hildebrand, I should be 21 asking this of Mr. Short, but since you brought it up: In 22 the agreement, the San Joaquin River Agreement 6.9 is the 23 paragraph that says, "The no recirculating obligation has 24 not been recognized in the agreement." 25 Do you know if that's because they just haven't CAPITOL REPORTERS (916) 923-5447 165 1 studied it, or that they are against the recirculating plan 2 itself? Have you had discussions along those lines? 3 MR. HILDEBRAND: Yes, I think probably Mr. Short 4 should probably answer the question; however, we discussed 5 it quite a bit. And I did a lot of work with Mr. Fults on 6 this issue who I was told earlier in our discussion that 7 they supported recirculation. And then on December 22nd I 8 was told that somehow or another we were now at war and 9 they were going to oppose it. So I can't explain it. I 10 can really only say what I was told. 11 MEMBER BROWN: Okay. Second question, Mr. Chairman, 12 there is a difference, of course, between applied water and 13 consumptive use of water. Do you have any estimation that 14 you've made in your travels over the years of what might be 15 added to the yield through such sayings as "conjunctive 16 use" and other improved uses that -- is there a 17 possibility, in your opinion, that enough yield could be 18 developed to achieve what we're trying to achieve other 19 than re-diverting the applied water? 20 MR. HILDEBRAND: No. I think conjunctive use is 21 always a good idea, but I think the potential for it is not 22 very great and not nearly as great as the amount of water 23 I'm talking about. And, furthermore, it's just an idea, 24 there's no commitment that's been made that the amount of 25 water that's put down on the basis of these water sales CAPITOL REPORTERS (916) 923-5447 166 1 would be limited to the increase in yield, or to a decrease 2 in consumptive use. 3 So, I'd have to assume that at least initially 4 and, perhaps, forever this water would be primarily 5 reallocation and not an increase yield; although, some may 6 be increased yield and that would be meritorious to the 7 extent it can be done. 8 CO-HEARING OFFICER STUBCHAER: Thank you. 9 MEMBER BROWN: Thank you. 10 HEARING OFFICER CAFFREY: Any other questions of 11 Mr. Hildebrand? 12 MEMBER DEL PIERO: Good to see you, Alex. 13 HEARING OFFICER CAFFREY: Good to see you, Alex. 14 MEMBER DEL PIERO: Absolutely. Very nice to hear 15 from you and we appreciate your comments. 16 MR. HERRICK: My name is John Herrick representing 17 South Delta, also. I'll keep it brief. 18 Mr. Chairman and Board Members, I just want to 19 address the procedural proposal that's been made. Although 20 it makes good sense to examine the VAMP, or San Joaquin 21 Agreement separately, we're concerned that any decision on 22 a piecemeal basis has -- has large risks. And, again, I 23 don't want to misquote the agreement, but one section there 24 talks about the tributary group agencies not being 25 responsible for any change, or impact to water quality due CAPITOL REPORTERS (916) 923-5447 167 1 to decreased flows. 2 That's the sort of thing that raises a flag with 3 us. If they're insulated from that, that means somebody 4 else might have to bare that burden. Obviously, if the 5 Bureau is going to meet those flows, that just means they 6 have to further drain New Melones. But I don't understand 7 how we could develop a CEQA document which says -- assuming 8 it finds if you do transfers like this, or provide these 9 flows there would be an impact on water quality, I don't 10 understand how you could have an order that says the people 11 that the CEQA documents finds caused that aren't 12 responsible for that. So we don't want to -- 13 MEMBER DEL PIERO: I wanted you to explain that to 14 me. 15 MR. HERRICK: Pardon me? 16 MEMBER DEL PIERO: I wanted you to explain that to 17 me. 18 MR. HERRICK: I can't. Another question, and again 19 I'm not -- I don't pretend to be the expert on the document 20 itself, but if you're going to isolate people's 21 responsibility under this process, since some parties 22 aren't supplying water, I assume those parties are also 23 getting money from the pot. And it just seems strange to 24 me that somebody who's not supplying water and getting 25 money for that is then isolated from further CAPITOL REPORTERS (916) 923-5447 168 1 responsibility. If somebody is isolated, then somebody has 2 to bare that burden. Interestingly enough we agree with 3 Mr. -- 4 HEARING OFFICER CAFFREY: Could you explain that, 5 Mr. Herrick? I didn't read that in the agreement. 6 MR. HERRICK: I may be misstating. 7 THE AUDIENCE: You are. You are. You're entirely 8 misstating it. 9 HEARING OFFICER CAFFREY: Anything else, Mr. Brown? 10 MR. HERRICK: Then that doesn't apply. But the point 11 is if somebody is isolated from further responsibility if a 12 need arises then other people would have to bare that. So 13 if it doesn't -- and I didn't -- I'm not trying to mislead 14 the Board on that. I just raised the question on it. 15 Interestingly enough we agree with Tom Graff. We 16 were considering asking the Board also to have a 17 determination of what the legal responsibilities are, the 18 position of the Board, that makes it a little better to 19 proceed. I'd like to repeat Alex's comment if I may 20 briefly about the interim operations plan. And I hope the 21 Board understands that the Bureau's own modeling for the 22 interim operations plan shows it not meeting the water 23 quality standard in approximately 40 percent of the year 24 types. That's very serious to us and we certainly don't 25 want an order that assumes that. The whole idea here is to CAPITOL REPORTERS (916) 923-5447 169 1 get something that works and addresses all of the 2 beneficial uses and protects all of objectives in the plan 3 not just some of them. So if we go into this thinking, or 4 knowing under the Bureau's modeling that they're not going 5 to make it, you know, we don't think that's a good idea. 6 The CEQA issue: If we have separate hearings for 7 the VAMP study I'm just seriously concerned that before we 8 have any sort of environmental document we're setting a 9 deadline for when my comments have to be due, that's going 10 to be a big issue to examine that. And we're going to have 11 to get experts to give us an opinion. I don't know what 12 the latest scheduled release of any environmental document 13 is, but if I have to have comments 30 days before some 14 proposed July meeting, that's pretty tight to get that 15 done. I think most people would agree with that. 16 And, finally, I'd just like to say the tidal 17 barrier program should not be assumed to solving the South 18 Delta problems. We're having large difficulty getting 19 permit conditions approved that allow us to operate it when 20 we think it should be operated, and without those permit 21 conditions then somebody needs to -- we'll be part of that, 22 someone needs to determine whether any proposal would have 23 further affects to the South Delta riparians. I am not 24 aware of any adaptive part of the VAMP that says if the 25 exports during that time of that flow are harming South CAPITOL REPORTERS (916) 923-5447 170 1 Delta riparians that there will be an adjustment. 2 By way of example the -- just this year, I'm not 3 sure what subcommittee of the opts group decided that in 4 order to protect Delta smolt but allow exports to ramp up 5 they would tie open the gates on the barriers. They didn't 6 consult us on that and we were a little upset. Anyway, the 7 issue is: If you've got a set plan for exports and flow 8 coming in and you don't take into consideration the South 9 Delta riparians, we may be harmed in certain instances. 10 That's all I have. Thank you very much. 11 HEARING OFFICER CAFFREY: Thank you, Mr. Herrick, we 12 appreciate your comments. 13 Dante Nomellini. I'll read the next few names. 14 After Mr. Nomellini we have Cynthia Kochler; Paul Simmons; 15 Andrew Hitchings. 16 Good afternoon, sir, and welcome. 17 MR. NOMELLINI: Mr. Chairman, Members of the Board 18 I'm, Dante John Nomellini. I'm one of the attorneys for 19 the Central Delta Water Agency. First of all, the Central 20 Delta Water Agency is opposed to the San Joaquin River 21 Agreement. As we had stated previously I believe in 22 workshops that deal with this particular problem, we do not 23 have any objection to the approach to use variable flows to 24 learn more about the impacts on fish. It makes good sense 25 to us that some type of variability could very well provide CAPITOL REPORTERS (916) 923-5447 171 1 greater information. And, therefore, such an effort might 2 be worthwhile. 3 The problem with the agreement is that it purports 4 to settle out for a number of water users their potential 5 commitment to implementation of the 1995 Water Quality 6 Control Plan. As we pointed out previously, a piecemeal 7 settlement of any kind in advance of a full determination 8 of what the scope is that has to be allocated, what the 9 environmental impacts are, is totally inappropriate in our 10 view. And we would fight it aggressively. 11 Now, there are a number of aspects of this 12 particular agreement that I would like to call to your 13 attention. I did not make a complete study of it, but 14 there's some very difficult problems in this agreement 15 associated with positions to be taken if you bless this 16 agreement, for example, with regard to letting Friant water 17 users and all these listed users in here off the hook for 18 any responsibility for water quality in the Water Quality 19 Control Plan, you are probably underminding some of the 20 legal positions that you've taken in other being actions. 21 And I think a lot of lawyers worked on this and it was 22 carefully drafted. And there's some real subtleties in 23 here. 24 Another part of it is the Bureau's so-called 25 commitment, you know, I mean a guy says, all right, the CAPITOL REPORTERS (916) 923-5447 172 1 Bureau is going to commit to meet the Water Quality Control 2 Plan. All right. That's good. If they can get a little 3 bit of water from these guys up here that's fine, no big 4 problem. That isn't what they say. They reword their 5 commitment in here, they weasel-worded their commitment so 6 that if you adopted this agreement you would under mind 7 what we all believe to be the Bureau's basic commitment to 8 meet this Water Quality Control Plan. 9 MEMBER DEL PIERO: That's a legal term, Mr. Chairman. 10 HEARING OFFICER CAFFREY: I just realized that, 11 excuse me. 12 MR. NOMELLINI: And that's the best way I can 13 describe it. Somebody said, oh, there's a simple provision 14 in here. You're going to adopt an enforceable order 15 against the Bureau and the Department of Water Resources, 16 right? You can't get jurisdiction over the Federal 17 Government in State Court, as we know, because of their 18 sovereign immunity. So it would be appropriate that if you 19 were even going to approach that, to ask the Bureau to 20 belly up to the bar right up front and wave their sovereign 21 immunity so we can have an adequate court review of the 22 decision and determination on the issues of law. 23 Now, to throw a little mud on you guys, we've 24 attempted to get some of these legal questions determined. 25 And your attorneys, and I assume it's with your blessing, CAPITOL REPORTERS (916) 923-5447 173 1 have raised the procedural obstacles at every point to make 2 sure there's been no legal determination on those issues. 3 Now, to the question asked of Tom Graff: How do 4 we get these things determined? There are opportunities to 5 get some of these legal issues determined in advance of the 6 full proceedings. We could use the declaratory relief. We 7 could go in on a stipulated record, we could go in with the 8 agreement of the parties, the parties would, of course, 9 have to be willing to submit to the legal jurisdiction. 10 So there are mechanisms to reach those legal issues. 11 And the legal issues are extremely important in 12 trying to allocate the burden for the 1995 Water Quality 13 Control Plan. We think threshold to the question, and we 14 believe it's obvious: What is the obligation of the Bureau 15 and the Department to mitigate their own impacts? 16 That's a basic threshold problem that we've 17 alleged before, that's their duty. We shouldn't have to 18 argue about that. They cause a detrimental impact, they 19 should have to mitigate it. Then we have in addition to 20 that, salinity control. What is the salinity control 21 responsibility of the projects? We view that as an 22 incremental addition of responsibility over and above what 23 we would determine to be the mitigation responsibility. 24 And then we have: How do we deal with the basic 25 priorities for the areas of origin? We have the Delta CAPITOL REPORTERS (916) 923-5447 174 1 Protection Act. We've got the Watershed Protection Act. 2 They all say we in the Delta come first, Northern 3 Californians come first. Those issues are going to be 4 litigated to no end if there's any reallocation of this 5 burden on somebody else. 6 Now, if you really want to go in that direction, 7 we should see if we can't agree on legal issues that could 8 be presented to a court for interpretation. And I would 9 agree it would be helpful if the State Board had some kind 10 of position, a general briefing document, or whatever that 11 would focus their attention on that. Because if we could 12 get the legal issues somewhat focused, the rest of the 13 stuff could be better packaged to make more meaningful 14 progress towards resolution of the problem. Now, that's a 15 big job. 16 Now, how do we avoid a water rights hearing, a 17 major water rights hearing that's going to take us a few 18 days to try? Some people have estimated 179 days. I don't 19 know how many days it is, but it's going to be a lot of 20 time and a lot money. Now, we know that it's possible, it 21 sounds like from hearing from the testimony, it's possible 22 that people would agree they would tolerate you making a 23 finding that says a variable method of testing could be 24 used as a stepping stone to compliance with your 1995 Water 25 Quality Control Plan/Vernalis Fishery Flow requirement. CAPITOL REPORTERS (916) 923-5447 175 1 And I haven't heard everybody, I don't know, but it sounds 2 to me like you're saying is it possible to have a test that 3 would then be justified as consistent with the 1995 Water 4 Quality Control Plan. That would be a very separate issue. 5 Then the harder question, but not necessarily a full water 6 rights proceeding would be: Where do we get the water to 7 conduct such a test? 8 If you want to boil this San Joaquin tributary 9 thing down to a little dollar and cents, it's probably a 10 water transfer worth some money. There's some water that 11 may or may not be available. The third-party impacts, of 12 course, are very important to us and we tend to agree with 13 Alex that that water, you're taking water out of an 14 overappropriated system and you're going to move it from 15 one person to another. And the other thing is New Melones' 16 obligation, which we think the Bureau ought to meet on the 17 watershed protection on a priority basis. But there is 18 other water that could be available. 19 Purchases, what's so wrong with purchases from 20 other water contractors, export contractors? We know there 21 are transfers taking place. You know, people have extra 22 water under contract. Why couldn't that, for the interim 23 test, also be brought back in, released into the San 24 Joaquin River? There's nothing wrong with purchases from 25 Friant users on a willing seller basis. CAPITOL REPORTERS (916) 923-5447 176 1 So we could isolate this problem on the San 2 Joaquin River down to a nonmajor water rights proceeding if 3 we had the State and the Federal Government, State 4 Project/Federal Project agree to continue their obligation. 5 They had their obligation for meeting the Delta water 6 quality standards for many, many years. They could 7 continue that further with some additional water coming 8 into the pot. And that's what's happening here. We're 9 having water transfers. They're buying this water under 10 the leverage of the threat that you guys are going to force 11 somebody to release water anyway. 12 So that leverage has come into play. Maybe you 13 don't realize it, but we out here do. And that has 14 stimulated the bargaining, but with the water coming in on 15 that basis you could very well structure this period, an 16 interim period, a test and then we have to focus in on the 17 third-party impacts. 18 That's about all I have to say at this time, but 19 we intend to participate vigorously. On due process I was 20 happy to hear Mr. Wright say he was now concerned with due 21 process and the participation of everybody. But I would 22 note that the procedures that we're following are not very 23 good, because he can write you a letter and we don't get 24 copies. This hearing has been noticed. I talk to Barbara 25 a little bit about the procedure. And I guess we can CAPITOL REPORTERS (916) 923-5447 177 1 conduct discovery inspection of your records to get these 2 things, but I think at an early stage here we ought to say 3 when anybody communicates with the Board in this matter, 4 they ought to copy everybody else who has noticed an 5 appearance. 6 I was a little surprised to see even on the 7 environmental document there was no required copying, but 8 now that I've learned how to look at your records I will, 9 of course, be there. But if you end up with 90 lawyers 10 looking at your records, you're going to be burdened 11 unnecessarily. And I think a good clear procedural 12 statement in an early stage that when there is 13 communication that there's copies, that would help reduce 14 that problem. 15 MEMBER DEL PIERO: Mr. Nomellini, no one ever gets 16 mail. Really, we don't get mail up here. 17 MR. NOMELLINI: Well, I've got some evidence to 18 present to you when we finally do get in the hearing that I 19 think would be of interest in that regard. Anyway, any 20 further questions? 21 HEARING OFFICER CAFFREY: Mr. Nomellini, it's always 22 a pleasure. I didn't mean that to be facetious. You 23 always wake us up. 24 MR. NOMELLINI: Everybody was kind of nodding. 25 HEARING OFFICER CAFFREY: Anything else from the CAPITOL REPORTERS (916) 923-5447 178 1 Board Members for Mr. Nomellini? 2 MEMBER DEL PIERO: Mr. Nomellini, have you 3 investigated the water purchase issue with any of the 4 existing contractors in the San Joaquin Valley? 5 MR. NOMELLINI: No. 6 MEMBER DEL PIERO: Okay. 7 MR. NOMELLINI: What they're trying to do, obviously, 8 is extricate themselves from the whole proceeding. I think 9 that's an unrealistic approach, but that's what they wanted 10 to do. They kind of -- we were thinking of doing the same 11 thing if you guys buy this kind of stuff, we'll get in a 12 room together, we'll draft up an agreement, we'll put all 13 the good stuff in there, you know: We're not obligated for 14 anything, the Bureau is obligated for everything. So, you 15 know, and we'll waive sovereign immunity and then we'll 16 have you bless that, and then when we get in a court fight 17 we can say that the Board determined that this was exactly 18 the case. We've given some thought to that, too, but that 19 isn't going to bring us too far down the path. 20 MEMBER DEL PIERO: Will you have an environmental 21 impact -- 22 MR. NOMELLINI: We'll negotiate with these guys, but 23 they want to pick the easier pigeons first. 24 MEMBER DEL PIERO: How do you really feel, 25 Mr. Nomellini? CAPITOL REPORTERS (916) 923-5447 179 1 HEARING OFFICER CAFFREY: Well, maybe on that note, 2 I've just been told that the little snack shack closes at 3 3:00. So let's take about a ten-minute break. And we'll 4 resume with Cynthia Kochler. Thank you. 5 (Recess taken from 2:42 p.m. to 3:04 p.m.) 6 HEARING OFFICER CAFFREY: Let's take our seats and 7 resume the workshop. As soon as we get enough people in 8 the room I'm going to make an announcement about the 9 schedule. All right. Let's proceed. 10 Let me start out by announcing what we plan for 11 the rest of the day. I count I believe it's 16 remaining 12 cards for comments on the VAMP. I'm assuming that will 13 take us at least another hour. Of course, the moment I say 14 that it takes 15 minutes. But assuming it will take us 15 another hour, it's now a little after 3:00. That's 16 probably as good a place as any to stop. 17 We got a lot of information today, we've been here 18 since 9:00. We can resume first thing in the morning with 19 the Mokelumne River Agreement and try and finish the three 20 remaining agreements and other subjects tomorrow. If we 21 can't finish tomorrow, then we have other days set aside. 22 And we'll continue the hearing to some convenient date in 23 the near future, perhaps, Thursday. 24 What's that, Mr. Del Piero? Mr. Del Piero asked 25 me to point out, also, that some of the Board Members have CAPITOL REPORTERS (916) 923-5447 180 1 commitments at other places over the next several days, not 2 the least of which is our budget in the Senate on Thursday. 3 So, there may be times when you see us here where one or 4 two of us are gone. That does not indicate disinterest in 5 any way. We have the transcript, which we can and will 6 read. So I just wanted to point that out. 7 With that then we will -- let me read the 8 remaining cards as Ms. Kochler is coming to the podium, 9 Cynthia Kochler, Paul Simmons, Andrew Hitchings, Kevin 10 O'Brien, Ralf Carter, Dan Gallery, Virginia Cahill, Jeanne 11 Zolezzi, Jim O'Laughlin, Bill Baber, Lowell Ploss, Steve 12 Chedester, Steve Ottemoeller, Michael Jackson, Roger 13 Golber, I believe, Thomas Shephard. Reid Roberts, and 14 Patrick Porgans. 15 Good afternoon, Ms. Kochler, and welcome. 16 MS. KOCHLER: Thank you. Good afternoon. I am 17 Cynthia Kochler, I am general counsel for Save San 18 Francisco Bay. And I thank you for providing us the 19 opportunity to speak with you here today. I see that you 20 have a sign here saying, "If reading from a document, 21 please, slow down." I assume that was for my benefit. 22 HEARING OFFICER CAFFREY: We won't mention any names, 23 but actually it was not you. 24 MS. KOCHLER: I'm going to try not to repeat comments 25 that others have made, because a lot of the points I want CAPITOL REPORTERS (916) 923-5447 181 1 to raise have been addressed. In our view portions of the 2 San Joaquin River Agreement may be productive and useful. 3 And we support parties coming together to attempt to work 4 through difficult issues. However, there are portions of 5 the agreement that are troubling. In our view the Board 6 does not have to accept the agreement as a package, but 7 rather we urge you to consider those elements that work and 8 modify those that do not. The key, as I know you are 9 aware, is to adopt a water rights decision that gives 10 effect to water quality standards and both to the Water 11 Quality Control Plan and that protect the public trust 12 interests of the estuaries and ensures a reasonable use of 13 the water. 14 In that regard I'm just going to just very briefly 15 review the three major concerns that Save the Bay has with 16 the agreement as it now stands. First as you heard from 17 others, we cannot support the use of funds designated for 18 environmental protection to pay parties to comply with the 19 water quality standards. In addition to the reasons given 20 by others for avoiding the use of public funds to pay for 21 water quality compliance, we are particularly concerned 22 about the proposal to use restoration fund money. These 23 funds are intended to provide critically needed benefits 24 over and above the benefits that would be provided by the 25 water quality standards. Thus, diversions regarding the CAPITOL REPORTERS (916) 923-5447 182 1 restoration funds to pay for compliance would substantially 2 limit the resources available to restore the estuary. 3 Second, a central aspect of the San Joaquin River 4 Agreement is development by a technical team of an 5 operations plan every year to implement the VAMP. However, 6 Section, I think it is, 6.6 would allow any parties to the 7 agreement to object to the operations plan for any reason, 8 any reason at all, having nothing to do with whether the 9 standards are being implemented, having nothing to do with 10 the VAMP study, was being conducted appropriately. 11 If the Board were to adopt this provision then any 12 party could derail the -- the plan really for any reason 13 and we'd be right back where we are today, which is trying 14 to put together a water rights decision. In our view the 15 possibility of any party to the agreement deciding to do 16 that for reasons that have nothing to do with water quality 17 compliance are high. And, therefore, this is a provision 18 that we feel is fundamentally odd for the purpose of 19 putting together a water rights decision. 20 Third, the technical committee as it is currently 21 proposed would comprise solely of parties to the agreement. 22 Since the parties to the agreement are overwhelming the 23 diverters, we feel this is not in the public interest. We 24 think the concept of the technical committee is correct, 25 and we certainly agree that the water users who are CAPITOL REPORTERS (916) 923-5447 183 1 affected by it should be on it. We would urge you in your 2 consideration of this to broaden that participation to 3 include members of the public and others with a stake in 4 ensuring that the agreement actually does provide an 5 equivalent level of protection for the estuary. 6 Finally, we need to clarify a few points made on 7 the prior testimony today regarding the support for the 8 agreement. Neither Save the Bay, nor I believe most of the 9 conservation of the fishing committees were active 10 participants in the VAMP negotiations neither through our 11 colleagues at NHI, or the Bay Institute, or otherwise. 12 Save the Bay participated very late in the process 13 in certain portions of certain meetings, but it is not 14 correct that each issue we raised was resolved to our 15 satisfaction. Just the three concerns that I just reviewed 16 are examples of objections we raised which remain 17 unresolved. Moreover, suggestions made earlier today 18 regarding EPA's support, I believe, is incorrect. Neither 19 EPA nor NMFS have signed the statement in support of the 20 document. And since I am also part of the mob that cannot 21 be here tomorrow, I am going to ask your indulgence to 22 speak briefly about the scheduling issue. 23 HEARING OFFICER CAFFREY: Go ahead, Ms. Kochler. 24 MS. KOCHLER: Thanks. We concur with the view of the 25 federal agencies in their letter of April 17th that full CAPITOL REPORTERS (916) 923-5447 184 1 implementation of the 1995 Water Quality Control Plan is 2 the foundation of a long-term CalFed plan; and delay in 3 this Board's implementation of that plan is threatening to 4 that process. As I'm sure you know, the success of the 5 CalFed effort will depend in large part on the ability of 6 the CalFed agencies to provide assurances that commitments 7 to meet program goals will be met in a timely manner. To 8 quote from our friends at Club Fed, "The absence of timely 9 decisive action by the Board to meet overdue commitments on 10 water rights and water quality standards will almost 11 certainly make it difficult to develop broad support for 12 CalFed's assurances package." 13 Second, regardless of the schedule, in our view 14 the Board must ensure, at a minimum, that the standards are 15 met to the extent feasible by the state and federal water 16 projects beyond 1998 when decision 95-6 is due to expire. 17 Falling back on D-1485 is not an acceptable outcome to Save 18 the Bay. Third, we urge the Board to conduct hearings that 19 would fully implement the entire 1995 Water Quality Control 20 Plan including a narrative standard. The worse outcome 21 from our perspective is one that examines only the 22 negotiated agreements and the other aspects of the plan 23 deferred indefinitely. And that concludes my comments. 24 I'd be happy to respond to any questions you have. 25 HEARING OFFICER CAFFREY: Thank you, Ms. Kochler. CAPITOL REPORTERS (916) 923-5447 185 1 Anything from the Board Members? Anything from staff? 2 Thank you for your patience and for being here to share 3 your thoughts here today. 4 Paul Simmons. 5 MR. HITCHINGS: Mr. Chairman, Members of the Board, 6 my name is Andy Hitchings. Paul Simmons asked me to appear 7 for him here today, because he could not be here this 8 afternoon. He was here this morning. He actually wanted 9 to present -- to present some brief comments for the City 10 of Stockton, but it's on the structure of the hearings. He 11 will not be here tomorrow, so I can present those to you 12 now. It's a very brief statement. 13 HEARING OFFICER CAFFREY: That would be fine. And 14 then you're the next card anyway. And I presume you'll 15 have a separate presentation of your own? 16 MR. HITCHINGS: Yeah. And as to the next card, I 17 submitted that to give comments on the potential GCID 18 Agreement for the Sacramento River. And I'd rather hold 19 off with those comments until the discussion of that 20 agreement later on, probably tomorrow. 21 HEARING OFFICER CAFFREY: That would be fine. Thank 22 you very much, Mr. Hitchings. Why don't you proceed then 23 for Mr. Simmons. 24 MR. HITCHINGS: Thank you. And this just goes to the 25 structure of the hearings. Our firm of De Cuir and Somach CAPITOL REPORTERS (916) 923-5447 186 1 represents the City of Stockton on water quality issues not 2 on water supply. The City of Stockton submitted written 3 comments for this workshop in a letter dated April 6th, 4 1998. Those comments focused on the structure of the 5 hearings only. Those comments make one basic point. It 6 is: The City strongly encourages the Board to get down to 7 the business of taking testimony on alternatives to achieve 8 dissolved oxygen objectives. The City is ready to go 9 forward and believes anyone else who is interested will be 10 ready also on this issue. The City has had discussions 11 with other parties on this issue and expects to continue 12 that. 13 The City does believe that other parties have some 14 responsibility and can have a role in the program of 15 implementation. However, this will not likely be the 16 subject of a formal settlement agreement as it is not a 17 water rights settlement in the sense of other possible 18 agreements that are before you. 19 The City also emphasizes that the issue of 20 dissolved oxygen improvement is closely related to other 21 issues that are coming before you. As a simple example, 22 the City's studies show that no matter what else happens it 23 will be literally impossible to achieve the dissolved 24 oxygen objectives at certain times of the year unless there 25 is an operable Old River Barrier to achieve positive flow. CAPITOL REPORTERS (916) 923-5447 187 1 The dissolved oxygen issue involves many 2 interrelated factors. The City will be identifying 3 solution oriented approaches to achieve other objectives. 4 We hope other parties will be supporting those approaches 5 and will be asking for guidance from the Board that will 6 help bring those about. If for some reason this topic is 7 not taken up as a part of the first-phase of the staged 8 hearing process, it is important that the order of hearing 9 not preclude comprehensive consideration of the dissolved 10 oxygen issue in the very near future. The City is very 11 concerned that it not be delayed indefinitely merely 12 because it is not the subject of the same type of agreement 13 as the other issues. And that's the conclusion of his 14 statement. 15 HEARING OFFICER CAFFREY: All right. Thank you very 16 much, Mr. Hitchings. And I presume we will see you later 17 on in this workshop, probably sometime tomorrow. 18 MR. HITCHINGS: Yes. Thank you very much. 19 HEARING OFFICER CAFFREY: Thank you, sir. 20 Kevin O'Brien. 21 MR. O'BRIEN: No comment, Mr. Chairman. 22 HEARING OFFICER CAFFREY: All right, sir. Ralf 23 Carter. 24 MR. CARTER: No comment, Mr. Chairman. 25 HEARING OFFICER CAFFREY: Thank you, sir. Dan CAPITOL REPORTERS (916) 923-5447 188 1 Gallery. 2 HEARING OFFICER CAFFREY: Good afternoon, 3 Mr. Gallery. Welcome. 4 MR. GALLERY: Thank you, Mr. Chairman. I have a few 5 comments on behalf of Tuolumne Utilities District in 6 Tuolumne County. Tuolumne Utilities District is -- 7 embraces approximately the northerly two-third of Tuolumne 8 County. This north boundary is the Stanislaus River. New 9 Melones Reservoir is located right on the boundary of 10 Tuolumne County and Calaveras County. So the reservoir is 11 half in our county and half within my district. 12 We have been planning ever since New Melones was 13 built to buy a small amount of water out of the New Melones 14 Reservoir for the needs in western -- the western part of 15 our district. We are talking about, perhaps, 5 to 9,000 16 acre feet of water. When New Melones was planned back in 17 the 1960s, the planning and thinking at that time was that 18 the project would provide -- I think the number was 220,000 19 acre feet of water for -- yield for use by project 20 customers. 21 So we went to the Bureau when it -- before -- at 22 the time that it came to the Water Board to get its 23 applications. And we said that we would like to get 24 assurance that we would be able to buy that water out of 25 New Melones when we need it. And the Bureau said, "No CAPITOL REPORTERS (916) 923-5447 189 1 problem." They -- we're talking about a small quantity of 2 water and they were going to have over 200,000 acre feet 3 available for project customers. And we had just 4 impeccable credentials to get that water. 5 First of all, the act of congress said that the 6 basin counties would have a preference for any of the water 7 generated by the project. And we -- Tuolumne County is 8 about 85 percent of the basin of the Stanislaus River. 9 In addition, the Watershed Protection Act says that the 10 Bureau has got to supply water to those areas of origin, or 11 those who are immediately adjacent thereto. And we are 85 12 percent of the watershed and we are right next to the 13 reservoir. 14 So, there was no problem. In 1972 they said, 15 well, here, we'll commit to you to sell whatever you need 16 out of New Melones when the time comes, if you will 17 withdraw your protest against our application. We did and 18 we got a contract with the Bureau that said, "When you need 19 the water out of New Melones Reservoir we'll enter into a 20 water service contract with you." 21 Now, we fast forward 25 years and the time is 22 coming when we would like to get a specific water service 23 contract, and the Bureau is now sounding as if they will 24 not be able to enter into a contract with us, because New 25 Melones is going to be used for water to quality purposes CAPITOL REPORTERS (916) 923-5447 190 1 and for flows in the Delta. And that's what this VAMP 2 Agreement does. This VAMP Agreement, in effect, dedicates 3 practically all of the yield to water quality flows in the 4 Delta and to fishery needs. 5 So, for that reason we have to take a position 6 that we've got to oppose this VAMP Agreement if that's the 7 case. If it's going to deprive us of this small amount of 8 water that we're going to need out of the reservoir. The 9 reservoir is right there and we have -- about 25 years ago 10 I remember the District attempted to go to the New Don 11 Pedro Reservoir and get some water for the western part of 12 the county out of that -- out of that reservoir. And the 13 Turlock and Modesto Irrigation District had no water to 14 sell. So that left us with New Melones. 15 So we look at this VAMP Agreement and we see that 16 it's -- it certainly has some good features to it. The way 17 it was described this morning I was really impressed. I 18 could see that it would produce some very value information 19 to meet the future needs of the San Joaquin River and 20 Vernalis. But to us it's -- we really can't hold sail for 21 it, because if it's going to take all of the Melones water 22 and leave nothing for our small needs, well, we have no 23 alternative but to oppose it. 24 It -- it says that there shall be no recirculation 25 of water, as Mr. Hildebrand suggested, it -- it -- to us CAPITOL REPORTERS (916) 923-5447 191 1 the Bureau of Reclamation -- there's other water that could 2 be made available to meet those Vernalis standards so we 3 would not be deprived. And one of them would be 4 recirculation at the Bureau pumps. Another one would be 5 some control of the saline water that's coming down from 6 the west side. It's a problem that's been created by the 7 importation of Sacramento River water into that west side. 8 This agreement says there will be no water from 9 Friant. This agreement means that Friant, which is 10 receiving water that's out of the watershed and receiving 11 water that will be used out of the watershed and is taking 12 it out of the San Joaquin River system, it is, in effect, 13 water that's exported, means that we have -- the Melones 14 water which should be available for use in our watershed is 15 being used to make up for that. We can't see the logic, or 16 the fairness of that. 17 So, that our position really is that the Board 18 should not approve or adopt the VAMP Agreement until it is 19 fully explored how that agreement will work and compare it 20 to the other alternatives that are in your draft 21 Environmental Impact Report. We would have no objection to 22 the agreement if it can be demonstrated that the Bureau's 23 performance of its obligations under that agreement will 24 not impair the Bureau's ability to provide the small amount 25 of water we need up in Tuolumne County where we're CAPITOL REPORTERS (916) 923-5447 192 1 immediately adjacent to the reservoir. That's it. 2 HEARING OFFICER CAFFREY: Thank you very much, 3 Mr. Gallery. Any questions? Mr. Del Piero. 4 MEMBER DEL PIERO: Mr. Gallery, in your -- you 5 received a contract from the Bureau? 6 MR. GALLERY: Yes. It wasn't a water service 7 contract. It was a contract for the withdrawal of our 8 protest to the Bureau's application. And the contract said 9 at -- had a provision, that guaranteed our right to buy 10 water when we needed it. The language was, "The United 11 States further agrees that in the event Tuolumne Water 12 District Number 2," that was our name then, "or any user 13 within our District should desire to purchase water 14 impounded by the United States in New Melones Reservoir, 15 for any reasonable beneficial purpose that the United 16 States will sell such water to the District, or to such 17 user at prices not exceeding those available for such water 18 to other users on the project." 19 Clear, unequivocal, and unconditional promise and 20 commitment. And it appears to us that the Bureau is 21 reneging on that promise. And for that reason we've got to 22 object to this VAMP Agreement. 23 HEARING OFFICER CAFFREY: Mr. Pettit and then 24 Mr. Howard. 25 MR. PETTIT: Mr. Gallery, your letter indicates, or CAPITOL REPORTERS (916) 923-5447 193 1 confirms that the language of that settlement agreement was 2 placed in the Bureau's permit for New Melones. 3 MR. GALLERY: Yes, it was. 4 MR. PETTIT: Has the Bureau given you any indication 5 that they're going to have any problem meeting those 6 commitments? 7 MR. GALLERY: They have. 8 MR. PETTIT: So we have a potential conflict? 9 MR. GALLERY: Yes. It really raises a permit issue, 10 Mr. Pettit. We haven't gone to court over this issue with 11 the Bureau. We're just in preliminary discussions, but we 12 can see we have a problem. 13 MR. PETTIT: Thank you. 14 HEARING OFFICER CAFFREY: Mr. Howard. 15 MR. HOWARD: One question I don't think it's so much 16 structured at Mr. Gallery but of the Bureau, perhaps, 17 relating to the interim New Melones operations plan issue 18 raised by Mr. Gallery. And I'm not sure who's the right 19 person, it might even be someone from the San Joaquin River 20 Group. Let me ask the question and see if someone can 21 answer. 22 HEARING OFFICER CAFFREY: Please. 23 MR. HOWARD: We've heard the San Joaquin River Group 24 say that the interim New Melones operations plan is a 25 pillar, I believe, was the term of the agreement. We heard CAPITOL REPORTERS (916) 923-5447 194 1 Alex Hildebrand say the New Melones plan will result in 2 lack of compliance with the salinity standards 40 percent 3 of the year. And we've now heard Mr. Gallery say it will 4 cause water rights problem with Tuolumne Utilities 5 District. 6 The question I have is: How is the interim New 7 Melones operation plan developed? And can someone tell us 8 about the logic that's embedded in it? 9 MR. NOMELLINI: Can I cross-examine? 10 MR. PLOSS: I was trying to avoid this. 11 THE COURT REPORTER: Your name, please? 12 MR. PLOSS: Lowell Ploss with the Bureau of 13 Reclamation. 14 HEARING OFFICER CAFFREY: Mr. Ploss, welcome, sir. 15 MR. PLOSS: The interim operations plan for the New 16 Melones that has been referred to I believe is a 17 three-year-old planning model that the Bureau ran in trying 18 to develop what would be the best operation for New Melones 19 in meeting all the competition for the resources. We did 20 try in that model to meet the '95 Water Quality Control 21 Plan, to meet flows on the Stanislaus River under CVPIA, to 22 meet water quality and to meet the needs of our CVP 23 contractors. 24 We varied the amounts for each of those demands 25 based on a -- the water supply that was available in New CAPITOL REPORTERS (916) 923-5447 195 1 Melones and what the projected water supply would be for 2 the balance of each year. In doing that model study, what 3 we did is we tried to protect the reservoir storage in New 4 Melones in an effort to have adequate water to carry us 5 through a prolonged drought like we experienced a few years 6 ago, a seven-year drought period. 7 And in doing so, as you heard earlier, there was 8 about 40 percent of time that we could not comply with 9 water quality requirements. Not surprisingly New Melones 10 alone cannot meet the '95 Water Quality Control Plan, nor 11 could we meet all of our fish flow -- in-stream fish flow 12 requirements, nor could we meet all of the contractor 13 needs. So, everybody took shortages when we're trying to 14 protect the reservoir for a prolonged drought. 15 With that information in hand, we entered into 16 discussions with New Melones -- with the Stanislaus 17 Stakeholder River Group, about 50 individuals representing 18 different interests on the Stanislaus River and outside the 19 Stanislaus River. For about two years we've been in 20 monthly discussions. No one can yet agree on the operation 21 of the New Melones Reservoir. For the past two years we 22 did acquire water from Oakdale Irrigation District. That 23 allowed us to meet some of our fish flows, while at the 24 same time making a commitment to the contractors, the CVP 25 contractors out at New Melones and meet our water quality CAPITOL REPORTERS (916) 923-5447 196 1 standards. 2 That interim operations plan is referred to in the 3 San Joaquin River Agreement. The San Joaquin River 4 Agreement also specifies that if that interim operations 5 plan for New Melones is modified that the parties to the 6 San Joaquin River Agreement would then evaluate the 7 commitments, the operations under that and determine if 8 there needs to be any adjustments made thereto. So while 9 it is an interim operations plan it is flexible over the 10 next 12 years. And we're continuing to work with the 11 parties on the San Joaquin River to try to improve on that 12 interim operations plan. 13 With regard to Tuolumne Utilities District, I 14 believe we did advise them at an earlier time about the 15 problems with New Melones Reservoir. Because of the 16 prolonged drought we've experienced up there, it's 17 interesting that the hydrology that was used to authorize 18 the project, the Federal Government looked at a drought 19 period different than what we've experienced recently. 20 Since New Melones Reservoir, construction was 21 completed, we've got both the wettest year of record in 22 Stanislaus and driest drought record, neither one 23 contemplated in the original planning. Looking at the new 24 drought scenario for New Melones and Stanislaus River, one 25 could say there is no new project yield on the New Melones CAPITOL REPORTERS (916) 923-5447 197 1 Reservoir. This is what prompted us to move in to a 2 process with all the interests in that basin to try to come 3 up with a way to balance the resource for everyone, not 4 unlike what you're trying to do. Good luck, if we've had 5 two years' experience with what we're doing. 6 So we are still open. We did advise Tuolumne that 7 based on the yield conditions there may be a difficulty for 8 them to get any kind of a firm yield out of the reservoir 9 during a critical period. The analysis we did do does 10 include deliveries to CVP contractors, it does not specify 11 which contractors. Right now the two contractors we have 12 there are -- Stockton East Water District and Central San 13 Joaquin Water District are the two contractors that we 14 currently have there. 15 MR. HOWARD: Just sort of a follow-up question. I 16 have a copy of the New Melones interim operations plan, it 17 was incorporated for the modeling that we did for the VAMP 18 alternative, which is presently posted on the Internet by 19 the way in case anyone wants to see the recent studies that 20 were done by the Department for the State Water Board. 21 And in it I had a question regarding the fish 22 releases, annual release for fish for the watershed. In 23 all of our previous modeling we had used fish releases of 24 98,000 acre feet to I think it was to 302,000 acre feet. 25 98,000 was from D-1422 and the 302,000 acre feet was from a CAPITOL REPORTERS (916) 923-5447 198 1 1987 Fish and Game Agreement as I understand it. 2 MR. PLOSS: Correct. 3 MR. HOWARD: However, for this study the Department 4 for its interim operations plan had established annual fish 5 releases for the Stanislaus River ranging from 98 to 6 467,000 acre feet, which is larger than we've seen in any 7 of our other model studies, 165,000 acre feet at better 8 conditions for the fish. My question is: Where did the 9 higher fish flow requirement come from? 10 MR. PLOSS: Those are the flows -- the higher level 11 of flows came from the CVPIA work that was undertaken. So 12 it's the anadromous fish -- from the draft Anadromous Fish 13 Restoration Plan. 14 MR. HOWARD: The last question I had had to do with 15 the agreement. In the agreement on page 12 and Section 16 10.1.1 it said, "In order to achieve the purpose of this 17 agreement, the Bureau shall assume responsibility for the 18 term of this agreement for the San Joaquin River portion of 19 the 1995 Water Quality Control Plan objectives that can 20 reasonable be met through flow measures." 21 Is it the Department's -- is the Bureau's position 22 that the interim operations plan is the level that can 23 reasonably be met? Is that what -- what this term means? 24 MR. PLOSS: Yes, it is. What can reasonably be met 25 with our operation at New Melones. CAPITOL REPORTERS (916) 923-5447 199 1 MR. HOWARD: Okay. Thank you. 2 HEARING OFFICER CAFFREY: All right. Were there 3 other questions of Mr. Gallery who was left standing out 4 there? 5 MR. GALLERY: That's where we are, we're left 6 standing. 7 HEARING OFFICER CAFFREY: I've been doing that all 8 day, Mr. Gallery. 9 HEARING OFFICER CAFFREY: All right. Thank you, 10 Mr. Gallery and Mr. Ploss. 11 Virginia Cahill. Good afternoon, Ms. Cahill. 12 Welcome. 13 MS. CAHILL: Thank you, Chairman Caffrey, and Members 14 of the Board. My name is Virginia Cahill. I also 15 represent the City of Stockton. Mr. Simmons and I have 16 divided areas of interest for the City. I'm here today to 17 address the Vernalis Adapted Management Plan, which today 18 we are being told we should refer to as the San Joaquin 19 River Agreement. So, I probably should edit my letter 20 already. 21 At this time the City of Stockton does not endorse 22 the Vernalis Adaptive Management Plan/San Joaquin River 23 Agreement. We wish to review those portions of the State 24 Board's EIR that will analyze that alternative. We 25 understand those will be ready in approximately May. And CAPITOL REPORTERS (916) 923-5447 200 1 we would like to review the EIS/EIR being prepared by the 2 proponents of the San Joaquin River Agreement before making 3 a final decision on the City's position. 4 We do agree in principal with the idea of an 5 adaptive management study to determine the needs of the 6 fisheries on the San Joaquin River. We, certainly, believe 7 there is a need for additional studies of fisheries and a 8 real determination of what it is that they need. We do, 9 however, have several concerns with the San Joaquin River 10 Agreement in its current form. 11 The San Joaquin River Agreement allows the Bureau 12 of Reclamation to continue to deliver only a fraction of 13 the water which it is contractually obligated to provide to 14 the Stockton Water District and the Central San Joaquin 15 Conservation District. Unlike Tuolumne Utilities, those 16 two actually entered into their contracts with the Bureau 17 at the time. And they are also now finding that the yield 18 has disappeared to the point where if the Bureau is the 19 backstop of the San Joaquin River Agreement, the New 20 Melones contractors are back stopping the backstop. I 21 think that's where all the hard balls end up. 22 VAMP doesn't adequately seek to put the burden of 23 mitigation of adverse impacts in the Delta on those parties 24 which are actually causing the impacts. Before we assign 25 responsibility, we ought to be figuring out, to the best we CAPITOL REPORTERS (916) 923-5447 201 1 can, what is causing the adverse impacts in the Delta. And 2 then, first, putting the responsibility for mitigating 3 adverse impacts on those that are causing them. 4 VAMP does not adequately address the origin of 5 rights to the New Melones contractors, thus considers 6 releases from Delta/Mendota Canal. It considers only 7 releases from New Melones to meet the Vernalis standards. 8 VAMP does not require the release of any water from the 9 Friant unit, notwithstanding the requirements of the 10 California Fish and Game Code Section 5937 in the Public 11 Trust Doctrine. 12 And finally, VAMP does not address the problems of 13 salinity in the San Joaquin River. To its credit I think 14 it specifically says it doesn't, but we're hearing today 15 that this is a San Joaquin River total package, or it 16 sounds like it's intended to be a San Joaquin River total 17 package. And, yet, without addressing salinity we don't 18 have a San Joaquin River total package. 19 Your original hearing notice for your hearings had 20 various alternatives for flow objectives, but you also had 21 various alternatives for meeting the salinity standards in 22 the San Joaquin River. I don't know whether it is intended 23 that if VAMP goes into effect that the salinity issues are 24 put on hold for 12 years; or if we go ahead and have 25 hearings on those salinity issues. I don't think we ought CAPITOL REPORTERS (916) 923-5447 202 1 to put them off for 12 years. I think they've been 2 postponed too long. 3 It's ironic that this is a water rights hearing to 4 implement a water quality standard, but even more ironic 5 the water quality standard that the San Joaquin River 6 Agreement is getting at, really doesn't have anything to do 7 with water quality. It really has to do with fish. It's 8 really a pulse flow requirement. It doesn't address the 9 quality of the water that reaches Vernalis in April and 10 May; only the quantity. And the real water quality issues 11 salinity in the San Joaquin River are not really being 12 addressed. And they're certainly not being addressed by 13 that agreement. 14 The City cannot say, as some others did, that we 15 were intimately involved in the negotiations of the San 16 Joaquin River Agreement. We did get some news from time to 17 time. We got some drafts. But the Stockton Eastern Water 18 District and the Central San Joaquin were specifically 19 excluded from the negotiating team that actually put the 20 real meat of the agreement together. 21 We are not taking a position today of "feet in 22 concrete opposition." We are really at this point not 23 supporting, but we're looking forward to reviewing the 24 environmental analysis. And we would urge the Board to be 25 careful not to end up with only a piece of the picture. CAPITOL REPORTERS (916) 923-5447 203 1 Whatever you do when you're done, I hope you will have done 2 the whole thing. I know that Paul Simmons made his 3 statement, I'm not quite sure how you all want the DO to 4 play in, but what he wanted you to know was it's ready to 5 go, so if you have -- if you're having trouble getting to 6 some of these more difficult issues, that might be a short 7 discreet issue that you could go ahead and do. 8 HEARING OFFICER CAFFREY: Thank you, Ms. Cahill. 9 Questions from the Board Members? Anything from the 10 staff -- oh, Mr. Del Piero. 11 MEMBER DEL PIERO: Do you normally advise the other 12 contractors that there may be deficiencies because of 13 compliance with this proposal? 14 MS. CAHILL: Well, the interim operations plan that 15 is the assumption of the San Joaquin River provides for 16 water to Central San Joaquin in only approximately, I 17 think, 20 percent of the years? 18 UNIDENTIFIED MAN: I think 20 to 10, it depends. 19 MS. CAHILL: Up to 40. 20 UNIDENTIFIED MAN: Or as low as 10. 21 MS. CAHILL: Or as low as 10, 10 to 40 percent of the 22 years. And for Stockton East it's no more than 1 in 10. 23 That interim operations agreement was developed in the 24 stakeholder process as Mr. Ploss said. And all the parties 25 agreed to it for two years, all with the further provision CAPITOL REPORTERS (916) 923-5447 204 1 that it not become a permanent agreement, which it seems to 2 be on the way of becoming. 3 MEMBER DEL PIERO: Thanks. 4 HEARING OFFICER CAFFREY: Mr. Brown had a question. 5 MEMBER BROWN: Ms. Cahill, how far up the San Joaquin 6 River would you suggest that water quality should be 7 addressed? 8 MS. CAHILL: We believe that the Board and the 9 Regional Board really ought to be setting water quality 10 standards upstream near where Salt and Mud Slough enter the 11 San Joaquin River; or at least as far upstream as Merced. 12 There's something unrealistic about setting a particular 13 point. We have to have this standard at Vernalis. It can 14 be miserable upstream of Vernalis and we can pull it all 15 out downstream of Vernalis; but for Vernalis it has to just 16 be just perfect. 17 We think the whole river should be looked at. In 18 particular, setting water quality standards upstream is a 19 very important element and that plays in. That's one of 20 the very clear inter-ties between water rights and water 21 quality in as much as if the water quality in the San 22 Joaquin River even before it got to Vernalis were higher 23 then you would need less New Melones water supply to be 24 diluting those flows. 25 MEMBER BROWN: Thank you. CAPITOL REPORTERS (916) 923-5447 205 1 MS. CAHILL: Thank you. 2 HEARING OFFICER CAFFREY: Anything from the staff? 3 Thank you, Ms. Cahill. 4 Jeanne Zolezzi. Did you wish to comment on the VAMP? 5 UNIDENTIFIED PERSON: No. No comment. 6 HEARING OFFICER CAFFREY: That's a bad sign. 7 MEMBER DEL PIERO: That's someone playing a trick, 8 that's not her voice. 9 MS. ZOLEZZI: Good afternoon. If I might, I'm 10 representing Stockton East Water District today. The card 11 has another agency, but that will be for tomorrow's 12 comments. 13 HEARING OFFICER CAFFREY: That's fine. 14 MS. ZOLEZZI: Just one comment before I begin, if I 15 may, on the interim plan, because I think it is important 16 that the Board and staff understand why some of the parties 17 to the original interim plan in the New Melones 18 Stakeholders Group who agreed to it for a two-year period 19 are now opposed to that plan. I think you need an 20 explanation. 21 The reason was that interim plan was a short-term 22 negotiated agreement. As Lowell mentioned, we are in the 23 process of a long-term negotiating process to try to reach 24 a long-term operations agreement for New Melones. We may 25 not be able to do that. We're still at the table, for a CAPITOL REPORTERS (916) 923-5447 206 1 while anyway. When we began we said: What can we agree 2 to? How can we operate the reservoir during this 3 negotiating period? 4 At that point it was very wet. We had some model 5 runs that showed given the likelihood of a full reservoir 6 and the chance of a wet year in the next year, under a 7 certain operations plan we could all get about as much 8 water as we wanted and we could stop arguing for two years. 9 So in the spirit of negotiations we did that. No one was 10 happy with that plan. We all agreed to live with it for 11 two years because we knew the reservoir wasn't going to run 12 dry. 13 At this point, no one at the stakeholders table 14 has agreed to continue that interim plan, because it 15 doesn't do anything for anybody. There are most of us who 16 would say that it only does something for the fishery. And 17 what -- the point that Tom made on the fishery levels, I 18 think you also need to understand that the 467 is not the 19 maximum. It is used in the model as a maximum for the fish 20 flows, but on top of that you need to add the Bay-Delta 21 flows which are up to 75,000 additional acre feet. So the 22 flows for fishery purposes exceed 500,000 acre feet in many 23 of the years for New Melones. So you have to keep that in 24 mind. 25 On to the San Joaquin River Agreement, Stockton CAPITOL REPORTERS (916) 923-5447 207 1 East, unfortunately, at this point has serious concerns 2 with the agreement. And I say "unfortunately," because we 3 have tried to go along with this agreement. We have tried 4 to find a way to make it work. We have submitted language, 5 some of which was incorporated, but at this point what has 6 come out this morning has made it clear that we simply 7 cannot support the agreement in its current form. 8 And that's not simply because we weren't included 9 in the negotiations. We've been there before as you well 10 know. We have to give them credit, at least we were 11 interviewed to be involved in the negotiations. We were 12 rejected after that, but at least we got an interview. 13 At the end of the negotiations we were allowed to 14 include some pieces of language that are now in the 15 agreement. If, in fact, those language additions had merit 16 on their own, we would probably not be opposing today. But 17 I'll explain to you why those language changes, given what 18 is being said by the United States today, don't offer us 19 any kind of room to get around the injury that the 20 agreement will have to us. 21 Our concern, of course, is the operation of New 22 Melones as the pillar of the agreement under the interim 23 operations plan. We were told early on when it was the 24 VAMP negotiation that the interim plan only applied to the 25 pulse-flow period. And that the United States was CAPITOL REPORTERS (916) 923-5447 208 1 committing to operate the interim plan during the 2 pulse-flow period, but that the rest of the year we could 3 continue to negotiate with them to establish a long-term 4 operations plan that we might be able to live with. That's 5 what we've been trying to do. 6 Our language that we added attempted to clarify 7 that, and Lowell referred to that language. Even though 8 the VAMP -- the San Joaquin River Agreement states that it, 9 New Melones will be operated to the interim plan, our 10 language acknowledged that that long-term negotiating 11 process was going on. That we hoped to reach a long-term 12 operational plan that may differ from the interim plan. 13 And if that were the case, every one should be on notice 14 that that would happen and it would change the operations 15 of New Melones. 16 But what has become crystal clear this morning is 17 that -- what has been said, this is now a San Joaquin River 18 Agreement. And, in fact, the United States got up this 19 morning and said that they would guarantee the flows, the 20 Bay-Delta flows and that they would, as a part of 21 assurances, be the backstop for those flows. 22 Now, what they really should have said is that the 23 in-basin users, Tuolumne County, Calaveras County, 24 Stanislaus County, and San Joaquin County were the 25 backstop, because it's the water that congress allocated to CAPITOL REPORTERS (916) 923-5447 209 1 those in-basin users that the United States is volunteering 2 to meet those Bay-Delta flows and to provide those 3 assurances. I think you know from past statements before 4 you that San Joaquin County is very tired of being a 5 backstop. 6 At this point we believe that that assurance, even 7 though what Lowell told Tom was that that assurance only 8 goes to reasonable flows, whatever that means. At this 9 point it appears to the United States that reasonable flows 10 are those that are set forth in the interim plan. If 11 that's the case, and if they are either committing to meet 12 the Bay-Delta standards or something less than that by 13 operating in accordance with the interim plan, it leaves no 14 room for us to negotiate a long-term operations agreement 15 that will give us more water than the one out of ten years 16 that Virginia was referencing. 17 And as you know -- and we will get into this if we 18 do have an actual hearing on the San Joaquin River 19 Agreement, we dispute the legality of the use of New 20 Melones water to meet the Bay-Delta standards. You heard 21 us go over that ad nauseam, we will go over it again. And 22 we will continue to negotiate. As Virginia said we are 23 interested in negotiating a long-term solution to New 24 Melones. Our litigation continues to be out there, but for 25 the past few years we've been spending all of our resources CAPITOL REPORTERS (916) 923-5447 210 1 on negotiating. We will continue to do that. And we could 2 probably stand aside and let VAMP go forward if it allowed 3 us that opportunity. In its current form it doesn't do 4 that and so we have to speak out in opposition. 5 So if we have any questions. 6 HEARING OFFICER CAFFREY: Thank you, Ms. Zolezzi. 7 Anything from the Board Members? From the staff? Thank 8 you for being here. We'll see you again I presume -- 9 MS. ZOLEZZI: Tomorrow. 10 HEARING OFFICER CAFFREY: Jim O'Laughlin? 11 MR. O'LAUGHLIN: No comment. 12 HEARING OFFICER CAFFREY: Bill Baber? 13 MR. BABER: No comment on the VAMP, Mr. Caffrey. 14 Thank you. 15 HEARING OFFICER CAFFREY: I saw your lips move, too. 16 So, thank you, sir. 17 Steve Chedester. 18 MR. CHEDESTER: No comment. 19 HEARING OFFICER CAFFREY: Steve Ottemoeller? There 20 he is. 21 MR. OTTEMOELLER: I've got a comment. 22 HEARING OFFICER CAFFREY: Good afternoon, sir. 23 Welcome. 24 MR. OTTEMOELLER: Good afternoon, Mr. Chairman, 25 Members of the Board. My name is Steve Ottemoeller CAPITOL REPORTERS (916) 923-5447 211 1 Assistant to the General Manager of the Westlands Water 2 District. I had not planned on making any comments, 3 because we are a potential party to the San Joaquin River 4 Agreement. We were intimately involved in all the 5 negotiations. But, frankly, there have been some comments 6 made since the presentation that are directly related to 7 the Westlands' interests that I feel compelled to make 8 comments on now. I know that the San Joaquin River Group 9 Authority and others will probably be responding in writing 10 to some of the issues that have been raised or 11 mischaracterized about the agreement, but there's two 12 things that I really need to talk about. 13 One of the them is the use of the restoration 14 fund. It was suggested by Mr. Bobker that maybe a user fee 15 would be a more appropriate way of financing this type of 16 thing. I think our water users and the water users in 17 Friant would be surprised to know that $6.88 per acre foot 18 for $11.00 and something in Friant per acre foot is not a 19 user fee. The use of the restoration fund to provide flows 20 in the San Joaquin River, we believe, is entirely 21 consistent with the act. 22 You recall -- or just to remind people, part of 23 the restoration fund is specifically identified to Friant, 24 what they call their surcharge started out at $4 now it's 25 $5. It's going to go up to $7. And that was specifically CAPITOL REPORTERS (916) 923-5447 212 1 related to the fact that decisions were not going to be 2 made, at least for some period, on releases of the water 3 from the river. And that there was an obligation on the 4 part of a lot of the water users to provide water to deal 5 with the environmental problems that may or may not have 6 been caused by the CVP. So this surcharge was imposed. 7 We believe that it's entirely appropriate that the fund 8 that includes the contributions from this surcharge be used 9 to ensure that there are flows, adequate flows at the mouth 10 of the San Joaquin River under this agreement. 11 So, the second issue that I have is with the 12 recirculation plan that Mr. Hildebrand has suggested as an 13 appropriate alternative. I don't want to comment 14 necessarily on whether or not it's an appropriate 15 alternative. There are two things though that I do need to 16 say. One is that the agreement does not prohibit a 17 recirculation plan. It simply says that the agreement will 18 not be used to require the implementation of a 19 recirculation plan. 20 The second thing is that we are concerned that the 21 analysis of recirculation has not been entirely consistent. 22 Mr. Hildebrand says that modeling shows it can be done 23 without impacting water users south of the Delta. Yes, 24 that's true if you make some assumptions regarding how the 25 project is going to be operated which is not consistent CAPITOL REPORTERS (916) 923-5447 213 1 with the Accord or current requirements. 2 If you allow free -- "free" is not necessarily the 3 word. If you allow complete recirculation, complete 4 pumping of the water that's coming back down the river 5 without regard to any of the export restrictions, either 6 percent of inflow or the pulse-flow period restrictions on 7 the amount of the San Joaquin flow, whichever ones are 8 going to apply, then you can achieve a situation where it 9 may not impact water users south of the Delta. 10 But the analysis that was done by the Department 11 of Resources's modelers for the State Board's draft EIR on 12 the recirculation shows there are impacts to storage in San 13 Luis Reservoir if you meet the Accord requirements while 14 trying to do this recirculation. In Westlands Water 15 District's case and other users south of the Delta, the 16 water service contractors of the CVP, are directly impacted 17 every year by the level of storage in San Luis. So if 18 there's an impact on storage, it's going to be an impact on 19 water supply and we believe that's entirely inappropriate 20 since we had nothing to do with the flows on the San 21 Joaquin River. And with that I'll conclude. Thank you, 22 unless there's any questions. 23 HEARING OFFICER CAFFREY: Thank you, Mr. Ottemoeller. 24 Questions from the Board? Anything from staff? Thank you, 25 sir, for taking the time. We appreciate you being here. CAPITOL REPORTERS (916) 923-5447 214 1 Michael Jackson. Good afternoon, sir. Welcome. 2 MR. JACKSON: Thank you, sir. I'm here today 3 representing the Regional Council of Rural Counties, which 4 are 27 counties either -- mostly upstream of the Delta on 5 both the Sacramento and the San Joaquin River that in many 6 cases are upstream of Bureau projects. And we are 7 extremely interested in you not bifurcating this particular 8 hearing. To do so, of course, puts folks in a position in 9 which all of their worse fears become what they operate on. 10 You assume that -- the reason for the bifurcation 11 is that some of the most powerful people went out the door 12 before you have to pay. And that makes everybody who is 13 less powerful very nervous. So we would request that you 14 not bifurcate the hearing, you do it all at once. And if 15 it takes some time, that's okay. I went to my first 16 hearing on this subject in 1978. Some people in here, I'm 17 sure, started in the '50s. We haven't really reached an 18 agreement yet. So I don't know what the big hurry is about 19 letting people out the door. 20 Basically, I would like to address six or seven 21 issues. The first and most important of the issues is: 22 Please, don't make a decision before you do the 23 environmental documents. The idea here is using the VAMP 24 as an example. Is that -- you presently have a draft 25 Environmental Impact Report, which is all of the CAPITOL REPORTERS (916) 923-5447 215 1 information that I have on this project. This information 2 shows that on the two most important issues, water quality 3 and fisheries, the VAMP doesn't solve the problem in either 4 case. 5 The Bureau just pointed out to you that -- that 6 they are only going to be able to meet the water quality 7 standard out at New Melones either 40 percent of the time, 8 or they wouldn't make it 40 percent of the time, but some 9 large number. And that's what is reflected in your own 10 modeling and in your own document. 11 It -- the basic problem is that there isn't enough 12 water in New Melones to do it with New Melones alone that 13 can be resolved in a year. The basic problem is that if 14 you accept the VAMP criteria, Friant, which is another 15 place that you could get the water, disappears off the map, 16 San Francisco disappears, East Bay MUD disappears, all of 17 the major places you could get the water to solve the 18 problem pay at the VAMP and now don't have to pay again. 19 Because if you read the document I think that you 20 will find that one of the beauties of it is for those that 21 sign it and contribute to it, it limits their liability for 22 the next 12 years no matter what happens. Now, for those 23 of us that live upstream of those projects and will always 24 believe that the area of origin rights and the watershed of 25 origin rights, and the sort of equity under which these CAPITOL REPORTERS (916) 923-5447 216 1 projects were built was that when we reached a stage of 2 growth where we needed the water, that this was temporary 3 water to be committed downstream; that when we reached that 4 stage we could get it back. Well, Mr. Gallery just 5 explained to you the problem that we're going to have in 6 getting it back. 7 The Tuolumne Utilities District, if the VAMP is 8 accepted, is in a situation in which they have only one 9 remaining possibility; and that's to find some way to build 10 a dam above New Melones and capture the water before it 11 gets there. And you can imagine the number of people that 12 it will bring out in this room, because we can't solve the 13 existing contracts to either Stockton East, or Central 14 Delta, or any -- South Delta, or anyone else downstream 15 already. So you can imagine the kind of problem that we 16 would have. 17 The benefit of the VAMP is very clear. What it 18 does is it allows the exporters to keep exports up. And 19 that's all it does. It doesn't meet the fisheries' 20 problem. It doesn't meet the water quality problem, but it 21 does give more water to the exporters than what they would 22 have under other circumstances. And it does limit the 23 liability of those just below the dam on the way down to 24 Vernalis. 25 I particularly agreed with the point of view that CAPITOL REPORTERS (916) 923-5447 217 1 the San Joaquin River deserves to have these standards, 2 either fishery or water quality, met at every stage down 3 the river, not simply at one point in Vernalis. If you ask 4 me the question of: Where we should begin doing water 5 quality on the San Joaquin River? I would tell you right 6 underneath Friant. 7 The next problem that this VAMP has is that, 8 again, it isn't equitable. The division of the flows on 9 the tributaries necessary to meet New Melones are run from 10 all of the water on the Stanislaus to none of the water on 11 the San Joaquin. All of these things need to be reflected 12 in the EIR before we go to hearing. The idea here is it's 13 very difficult to explain to my clients, for whom the VAMP 14 is just the first of a number of these agreements, how 15 they're going to get this area of origin water in the 16 future as we need it, when all of the water is already 17 committed down below. The document -- there seems to be 18 some feeling in a lot of what I've heard today that more 19 water in is somehow as significant as less water out. 20 I would point out to you that if you read your own 21 Environmental Impact Report, your draft impact report it 22 makes it very clear that any increase in exports hammers 23 the fishery, and hammers the water quality, and hammers the 24 bottom of the food chain in the Delta. So I don't think 25 that you can simply equate these things equally. Until the CAPITOL REPORTERS (916) 923-5447 218 1 problems at the export facility are fixed, simply letting 2 more water down the river is not going to solve the problem 3 if that water gets exported. It's going to increase the 4 problem. So the suggestion would be that if you're going 5 to release additional water down the river it not be 6 exported. That 1707 is a real good idea and that it should 7 be done about the Farralones Islands. 8 Basically, we also worry about -- about whether or 9 not you're going to have, according to if you use the VAMP, 10 any water available for either carryover storage for 11 fisheries, or salinity control. And both of those 12 questions were not dealt with specifically by the VAMP. 13 And I would argue that the reason that they're not dealt 14 with is because the results wouldn't allow the VAMP to look 15 like a solution to the problem. 16 Can we find a situation that will work for the 17 greatest good for the greatest number? I think so, but I 18 think that will emerge from real EIR's, real EIS's, and a 19 real hearing process. And I don't see any reason to 20 shortcut it at this time. 21 So for all of the reasons expressed by 22 Mr. Gallery, and for all of the reasons expressed by the 23 fishery folks, those of us who live upstream realize we 24 have to fix the problems in the Delta or there's going to 25 be more and more calls for water once every ten years; and CAPITOL REPORTERS (916) 923-5447 219 1 less and less ability for us to have water upstream for our 2 own growth and development and for our own ecosystem 3 health. 4 So at this point what I would suggest to you is 5 that we do not accept the VAMP as anything other than an 6 alternative. And that that alternative stand the same 7 rigorous testing in a water rights hearing as all of the 8 other alternatives which are suggested. 9 Thank you very much. 10 HEARING OFFICER CAFFREY: Thank you, Mr. Jackson. 11 Questions of Mr. Jackson? Okay. Thank you, sir. 12 Appreciate you taking the time to be here and sharing your 13 concerns with us. 14 I can't really read this name very well, is it 15 Roger Guinee from the U.S. Fish and Wildlife Service. 16 MR. GUINEE: Guinee. No comment. 17 HEARING OFFICER CAFFREY: Say the name again, please. 18 MR. GUINEE: Guinee. 19 HEARING OFFICER CAFFREY: Guinee, thank you, sir. 20 Thomas Shephard. Good afternoon, again, sir. 21 MR. SHEPHARD: Thank you. Mr. Chairman, and Members 22 of the Board, I will have just a few comments on behalf of 23 San Joaquin County. I like to start out by saying 24 That Mr. Gallery made me feel very good, because this 25 morning when the Bureau of Reclamation grandly says they CAPITOL REPORTERS (916) 923-5447 220 1 will be the backup to the backup, I thought that all comes 2 out of the San Joaquin County. Now, I know that Tuolumne 3 County shares our burden, so I feel a little bit better for 4 that progress of the day. 5 MEMBER DEL PIERO: Misery loves company, is that it? 6 MR. SHEPHARD: Yes, misery loves company. Actually, 7 to me it's inconceivable that Tuolumne County, which is 8 totally within the area of origin, a county of origin by 9 every definition and was within the statutorily protected 10 area should be deprived of water. That's very hard for me 11 to understand having been involved in New Melones literally 12 from its inception. 13 For the reasons that parties from San Joaquin 14 County have stated, and I won't repeat them, we cannot at 15 this time support the VAMP approach other than as was just 16 suggested by Michael Jackson, perhaps, as one alternative 17 to be rigorously examined during the hearing process. We 18 are strongly opposed to any segmenting of the hearing 19 process. 20 As I'm sure you knew before you came today, this 21 is a highly integrated process that has ramifications all 22 over it. And to solve one part of the puzzle without 23 solving the whole puzzle is going to result, we fear, in 24 harm to somebody and San Joaquin isn't just paranoid, we 25 fear the harm will be to us. CAPITOL REPORTERS (916) 923-5447 221 1 Certainly, no decision should be made until you 2 have heard all the related issues, and no decision should 3 be made until environmental impact reports have been 4 completed on all segments of the ultimate solution that is 5 going to be before you. We are not in a position to 6 adequately comment if the environmental impact reports are 7 completed on part and not on other parts that are coming. 8 Finally, I would say I support Mr. Graff's -- and 9 Mr. Nomellini indicated his support, Mr. Graff's approach 10 that you might at least proceed to examine the first. As 11 you've heard from San Joaquin County interest over the 12 years, we do place considerable faith in the Watershed 13 Protection Act, the Delta Protection Act, and the related 14 acts. And we're going to continue to place that faith 15 there and pursue them. And I think that a legal analysis 16 of those issues and the other legal issues, senior or not, 17 how do you share senior water right holders get out and the 18 juniors share or not, as the case may be? I think that if 19 you examine into that first and allowed, at least, the 20 parties before you to know what the Board's position is as 21 we start a serious hearing, I think it would be most 22 helpful. Thank you. 23 HEARING OFFICER CAFFREY: Thank you, Mr. Shephard. 24 We appreciate you taking the time to be here and sharing 25 your concerns with us. CAPITOL REPORTERS (916) 923-5447 222 1 Mr. Del Piero. 2 MEMBER DEL PIERO: Mr. Shephard, I have a question. 3 That's the third time I heard that today -- and I guess the 4 question is: Is there something going on that would lead 5 the general public, or representatives of the water 6 agencies to think that this Board was going to pursue 7 anything other than what the Water Code and case law has 8 articulated as water law in the State of California? 9 MR. SHEPHARD: As we commented on -- 10 MEMBER DEL PIERO: Has there been any pronouncement 11 from the Board? 12 MR. SHEPHARD: As we commented on the Environmental 13 Impact Report, lip service is given to the Watershed 14 Protection Statute, but it's not applied. That's just one 15 example. 16 MEMBER DEL PIERO: Thank you. 17 HEARING OFFICER CAFFREY: Thank you, Mr. Shephard. 18 Reid Noberts -- or Roberts, excuse me. 19 MR. ROBERTS: Roberts, yes, sir. 20 HEARING OFFICER CAFFREY: Excuse me. Good afternoon, 21 sir. Welcome to you. 22 MR. ROBERTS: Good afternoon, Mr. Chairman and Board 23 Members. My name is Reid Roberts. I am representing the 24 simple San Joaquin Water Conservation District, one of the 25 contractors of the New Melones Reservoir. We join in the CAPITOL REPORTERS (916) 923-5447 223 1 comments made previously by many of the speakers from San 2 Joaquin County regarding the problems that we all have as 3 to the San Joaquin River Agreement. I just want to give 4 you a very short and personal impression of what effect 5 this may have upon the district that I represent. 6 Back in the 19 -- early 1980's the district was 7 found to be an area of critical need for a supplemental 8 surface water source. The district comprises of 9 approximately 60,000 acre of agricultural property, totally 10 dependent upon the underground aquifer. We are the -- the 11 aquifer itself is in a condition of critical overdraft. 12 And for that particular reason we have sought for many 13 years a supplemental surface supply. When the New Melones 14 Project came along we hoped this would satisfy our problem 15 and we attended many meetings and spoke in support of that 16 particular project. 17 When it was completed we were -- we were one of 18 the few who was allowed to enter into contract negotiations 19 with the Bureau of Reclamation for a water service 20 contract. And in 1983 did receive a contract that would 21 allocate to us 80,000 acre feet of water on an annual 22 supply. It took approximately 15 years before any water 23 was actually delivered to us under that contract. In 1995 24 we got about a thousand acre feet. And over the past two 25 years we have gotten up to 27,000 acre feet, which has been CAPITOL REPORTERS (916) 923-5447 224 1 applied to help to reduce our overdraft condition. 2 As Ms. Zolezzi advised you previously we are 3 presently operating under an interim short-term agreement 4 that was supposed to take us through this year. Under that 5 agreement we are allocated 50,000 acre feet. However, 6 without that agreement and with the Bay-Delta Accord in 7 place, the estimates from the Bureau of Reclamation are 8 that we would receive approximately 40 percent of the 9 allocation under our contracts. 10 One of the major difficulties is that that 11 allocation comes sporadically. Some years we get nothing, 12 other years we get a full contractual allocation. So it's 13 something we simply cannot live with as that is structured. 14 And that is basically where we are. As of the end of this 15 year it is our understanding under the San Joaquin River 16 Agreement that even that diminished supply may be reduced 17 further. It's my understanding from the scenarios that 18 I've seen that under the San Joaquin River Agreement we may 19 end up with reductions as low as 90 percent. In other 20 words, one out of every ten years we would receive a full 21 allocation. 22 Obviously, for a district that is dependent upon 23 the supplemental water source to offset its overdraft 24 problems, this is totally unacceptable. And for that 25 reason we have to oppose the presentation of this CAPITOL REPORTERS (916) 923-5447 225 1 agreement. We do not by any means oppose the consensus 2 approach to resolve problems. We certainly would like to 3 see VAMP-type of a program progress. But quite, frankly, 4 on the small district that I represent, it has a really 5 dramatic effect. And it shows you what could happen when 6 you're the low man on the totum poll. The effect is that 7 there is an extremely unfair and unjust and inequity 8 reduction of the water source as far as my district is 9 concerned. And with that I will end it. 10 Thank you. 11 HEARING OFFICER CAFFREY: Thank you, Mr. Roberts. 12 Appreciate you taking the time. 13 Any questions? Mr. Brown. 14 MEMBER BROWN: Reid, what has happened to pumping 15 water well and water quality in the last few years? 16 MR. ROBERTS: Mr. Brown, our level has continued to 17 go down. However, in the past couple years with the heavy 18 rains that we have had there has been a slight increase. 19 But the overall trend is still downward. As I also 20 understand, the saline intrusion from the west has 21 continued to advance, it has not necessarily slowed down 22 and will not unless there's a significant recharge of the 23 underground basin. 24 MEMBER BROWN: What's the pumping level now? 25 MR. ROBERTS: In my district it varies anywhere from CAPITOL REPORTERS (916) 923-5447 226 1 90 to 110 feet. 2 MEMBER BROWN: Water quality? 3 MR. ROBERTS: In the district right now the water 4 quality is good, but right on the western edge of the 5 district is where the saline intrusion is occurring and if 6 that continues then eventually it will get into the water. 7 MEMBER BROWN: Thank you. 8 HEARING OFFICER CAFFREY: Mr. Del Piero, you have a 9 conjunctive use system question? 10 MEMBER DEL PIERO: Do you have a mechanism for 11 storage during wet years? 12 MR. ROBERTS: No, we don't. Unfortunately, the tax 13 base and the economic base of our district, we were able to 14 build a conveyance system for the New Melones supply, but 15 we are unable with the overall cost for finding a good site 16 to store water and getting a conjunctive use system on that 17 basis. 18 MEMBER DEL PIERO: I come from the Salinas Valley. 19 We have a -- we have a seawater intrusion problem there. I 20 can assure you, you can afford it when your wells go salty. 21 MR. ROBERTS: I understand that. 22 HEARING OFFICER CAFFREY: Anything from staff? Thank 23 you, Mr. Roberts. We appreciate you taking your time. 24 MR. ROBERTS: Thank you. 25 HEARING OFFICER CAFFREY: Patrick Porgans. Good CAPITOL REPORTERS (916) 923-5447 227 1 afternoon, sir. Welcome. 2 MR. PORGANS: Good afternoon, Mr. Chairperson, 3 Members of the Board. My name is Patrick Porgans with 4 Porgans and Associates. I'm here representing the public 5 trust interest. It seems to be a rare and endangered 6 species these days, which is something I entrusted the 7 Board to take care of. However, I have to say that you 8 haven't done that. And I'm not knocking you today, I'm 9 just pointing out the facts. 10 HEARING OFFICER CAFFREY: And you are here to talk 11 about the VAMP? 12 MR. PORGANS: Yes, I am. And then I'm not going to 13 be here tomorrow, because I have to make a living. 14 HEARING OFFICER CAFFREY: All right. Sir, I'm glad 15 to hear that. 16 MR. PORGANS: Thank you, Mr. Chairperson, my wife is 17 also glad to hear that. At any rate, getting to the VAMP 18 first, I want to point out that it's limited in scope. I 19 agree with a lot of what the other speakers had to say 20 today. I feel that it is a bifurcated process. No one has 21 contacted me to be involved in these negotiations. I'm 22 very surprised about that. I thought I was a very 23 diplomatic person. Nevertheless, this whole thing now is 24 being outside the scope of this Board. I'm not relying on 25 them to come up with agreements to protect my water in this CAPITOL REPORTERS (916) 923-5447 228 1 state. I rely on this Board. 2 I was at a meeting not too long ago where Mary 3 Jane Foster was present and EPA was out here talking about 4 this CWA, Clean Water Rights Doctrine. And they were 5 handing out some interesting information, because this VAMP 6 thing doesn't include -- it only deals with a certain 7 myopic aspects of water quality in the San Joaquin River 8 and the basin. This data shows -- this is information from 9 EPA and USDA if their information is reliable, I'm suspect 10 of all government data now. 11 But anyway, this map shows us that the largest 12 single contiguous contaminated area in the United States, 13 the contiguous United States, is right down here in the San 14 Joaquin Valley. Now, apparently somebody has failed to 15 take care of that problem. And who do you think that would 16 have been? Okay, I won't mention any names today, I'll let 17 everybody speculate as to who that is. 18 Lastly, I want to point out, you know, on the 19 issue of the VAMP is that this process is -- is segmented, 20 and I'm not getting full disclosure. I don't really know 21 what's going on. And quite frankly we went from the global 22 perspective, you know, hand it all to the village, let the 23 villagers handle it. And now what we need to do is get the 24 global village perspective, because you see I've been 25 involved in these hearings processes since the '70s. Okay. CAPITOL REPORTERS (916) 923-5447 229 1 And I know why we have a moving target. The 2 moving target has to do with overcommitted projects. So 3 what do we do? We try to move the target out decade after 4 decade. Two attorneys were standing there one day in the 5 '70s and one was saying, "This is my daughter." "Oh, how 6 lovely." And the other attorney says, "Yes, and she's 7 going to be in the firm now." And the other attorney says, 8 "Yes, you have a lifetime job just on the water rights 9 hearings." And the attorney was totally accurate. So 10 these attorneys may know a little more about the hearing 11 process than I do. Okay. 12 And I personally, as an individual citizen and 13 taxpayer I have to tell you, Mr. Chairman, with all due 14 respect to the Board, I like everybody on the Board, but in 15 terms of protecting my resources: You haven't cut it. 16 Lastly I want to say -- I'm done with the VAMP 17 thing, because for whatever reason their own little fox 18 dealing with their own little problem, while the waters of 19 the state become more degraded and the only thing that can 20 save them is the rain. And then every time we turn around 21 we get another postponement. Bob Potter, Dave Cannady, 22 nice guys. We need more postponements. I'm paying people, 23 Mr. Chairman, to do research, to be involved in the 24 process. 25 My wife keeps yelling me, "You're spending our CAPITOL REPORTERS (916) 923-5447 230 1 retirement money." You know and I'll take anybody on, but 2 the wife and that's not a wife joke, that's just a fact. 3 So what I'm saying to you is: No more moving targets. You 4 have to deal with the issue in its entirety. I don't 5 believe that anybody -- I can't get a fair hearing before 6 this Board, no way. I tried. I tried. 7 My due process rights have been violated by this 8 Board. I cannot seem to get the message through to this 9 Board that you have a responsibility to all the people in 10 the state, and not just water contractors. So what I'm 11 saying to you today, and I don't know how I'm going to do 12 it yet, you know, I'm thinking about it. You know me, I 13 give things a lot of thought. I respect a lot of comments. 14 Nomellini, as far as I'm concerned, is the saving grace to 15 the whole situation. And I don't have any personal 16 relationship with Nomellini. 17 MEMBER DEL PIERO: Don't say that too loud. 18 MR. PORGANS: That going to go over too loud. 19 MEMBER DEL PIERO: We'll have to empty the room next 20 door. 21 MR. PORGANS: Strike that. At any rate, my point 22 being that I'm trying to get on with the process, 23 Mr. Chairperson. I can't even ask anybody up here a 24 question. I don't know what votes are really going on. I 25 don't know any of that anymore. Quite frankly, I'm really CAPITOL REPORTERS (916) 923-5447 231 1 concerned. 2 Let me see if I can get to the last part of my 3 comments so that I can get back to earning a living. We 4 have a drainage time bomb sitting down there in the valley. 5 We're pushing for an isolated facility, because it's going 6 to increase yield by umpteen hundreds of thousands of acres 7 of water. We have not been able to meet those target loads 8 coming out of the Grasslands Water District. And I said 9 you were not going to be able to met them, Regional Board, 10 I told you way back when. 11 I told you those numbers -- someone was playing 12 pull the numbers out of the air. And I finally got that 13 confirmed. So what I'm saying is: Believe me, 14 Mr. Chairperson, I'm a very tenacious person. And I am not 15 going to give this up. Those that are taking water out of 16 the Delta have second right to the water. And we've got to 17 enforce that. You got to go after the issue of people not 18 using water reasonably. 19 I came to you, I asked you to do all that, 20 Mr. Chairperson. You guys held me off for almost a year 21 and a half, had a hearing, dropped out the whole issue in 22 terms of the unreasonable use issue, stuck in something 23 about protecting a few birds. I'm going to tell you in all 24 due respects, I'm going to conclude my comments by saying: 25 I'm just getting started. CAPITOL REPORTERS (916) 923-5447 232 1 Thank you very much, Mr. Chairperson. 2 HEARING OFFICER CAFFREY: Thank you very much, 3 Mr. Porgans. Haven't seen you in a while. It's always a 4 pleasure. 5 MR. PORGANS: It is. And I'm glad to hear about your 6 grandchild and the very best to you and your family. 7 HEARING OFFICER CAFFREY: Thank you, sir. That's 8 very nice of you. All right, that completes the cards for 9 today. I'd like to turn to the staff, because the staff 10 had some questions of the VAMP presenters. I want to make 11 sure we cover everything. And, Ms. Leidigh, you had some 12 questions? 13 MS. LEIDIGH: Yes. I guess the first question I have 14 is probably for Mr. O'Laughlin -- 15 HEARING OFFICER CAFFREY: Barbara, pull the mic up. 16 MS. LEIDIGH: I'm sorry. I think my first question 17 is for Mr. O'Laughlin. You guys have indicated that you're 18 going to file some petitions under Section 1707 of the 19 Water Code. And I'm wondering when you're expecting to 20 file those petitions. If the Board is going to process 21 those as part of this proceeding, which I assume is what 22 you intend, we'll need to have them soon. Is anybody able 23 to tell me? 24 MR. O'LAUGHLIN: Yes. We were intending to -- 25 HEARING OFFICER CAFFREY: Pull the mic up, please. CAPITOL REPORTERS (916) 923-5447 233 1 THE COURT REPORTER: And identify yourself. 2 MR. O'LAUGHLIN: Tim O'Laughlin on behalf of the San 3 Joaquin River Group Authority. We were preparing for this 4 hearing -- excuse me, workshop. We will have the petitions 5 on file shortly. Hopefully by the end of month. 6 MS. LEIDIGH: Okay. That answers that question. My 7 other question that I still have is: Somebody pointed out 8 that the Department of Water Resources had not agreed to 9 the one million per year yet, and that was part of the four 10 million dollars per year payment for the water. And what 11 I'm wondering is: When do you expect that agreement to 12 come? 13 MEMBER DEL PIERO: Hey, Dave. Hey, Dave, you got a 14 million dollars for us? 15 MR. SANDINO: We've agreed to the VAMP settlement 16 agreement in concept, but we had other issues to work out 17 with the November 20th plan. So that's the condition 18 ultimately for our signature to the VAMP settlement. The 19 one million dollars that we're envisioning, it would come 20 from the Proposition 204 money. And we would need to work 21 out the details on that. 22 MS. LEIDIGH: Okay. So your only real concern is not 23 with the one million dollars, it's with the November plan? 24 MR. SANDINO: Yes. 25 THE COURT REPORTER: I'm sorry, your name? CAPITOL REPORTERS (916) 923-5447 234 1 MR. SANDINO: I'm sorry. David Sandino on behalf of 2 the Department of Water Resources. 3 MS. LEIDIGH: Okay. Got anymore questions? 4 MR. HOWARD: No. 5 MS. LEIDIGH: I think that's all of the questions 6 that we had. 7 HEARING OFFICER CAFFREY: All right. Well, I would 8 like to see if there's anything else from the Board Members 9 before we conclude today. As I mentioned earlier, we would 10 conclude when we finished the VAMP presentation and the 11 various comments. 12 I want to thank the members of the VAMP, for lack 13 of a different term, negotiating group for putting on a 14 stimulating presentation, one that you've worked long and 15 hard on. And we're also very can grateful for all the 16 commenters and their points and view. Certainly, the Board 17 will consider all of your comments and all of those given 18 to us tomorrow on the remaining agreements. 19 It is our hope that we can conclude tomorrow. If 20 we cannot, then we'll have to announce at sometime tomorrow 21 after we exhausted ourselves as to when we will continue. 22 It is our hope to try to complete tomorrow. We will 23 shuffle the blue cards tomorrow so to change the order a 24 little bit, so that maybe others will have a chance to 25 speak first. And with that then, we will resume here in CAPITOL REPORTERS (916) 923-5447 235 1 this room at 9 a.m. and we will start with the Mokelumne 2 River Agreement. 3 Mr. Robbins, do you have something? 4 MR. ROBBINS: Yeah. Ken Robbins for the San Joaquin 5 River Group. I -- just as a point of clarification, the 6 Board had indicated earlier that some opportunities for 7 re-discussion of some issues raised today relative to 8 comments. Will that be done at the end of all of the -- 9 HEARING OFFICER CAFFREY: That will be at the very 10 end of all the agreement discussions and agreement 11 comments. The idea being that nobody was left out, or that 12 somebody who spoke early on -- 13 MR. ROBBINS: So we don't intend to start with that 14 tomorrow morning? 15 HEARING OFFICER CAFFREY: No, not at all. Not at 16 all. That will either be late tomorrow, or perhaps on a 17 third day. 18 MR. ROBBINS: Thank you. 19 HEARING OFFICER CAFFREY: Thank you all very much. 20 We'll be back here in the morning at 9:00. 21 (The proceedings concluded 4:45 p.m.) 22 ---oOo--- 23 24 25 CAPITOL REPORTERS (916) 923-5447 236 1 REPORTER'S_CERTIFICATE __________ ___________ 2 3 STATE OF CALIFORNIA ) ) ss. 4 COUNTY OF SACRAMENTO ) 5 I, MARY R. GALLAGHER, certify that I was the 6 Official Court Reporter for the proceedings named herein, 7 and that as such reporter I reported in verbatim shorthand 8 writing those proceedings; that I thereafter caused my 9 shorthand writing to be reduced to typewriting, and the 10 pages numbered 1 through 236 herein constitute a complete, 11 true and correct record of the proceedings. 12 IN WITNESS WHEREOF, I have subscribed this 13 certificate at Sacramento, California, on this 1st day of 14 May, 1998. 15 16 ________________________________ MARY R. GALLAGHER, CSR #10749 17 18 19 20 21 22 23 24 25 CAPITOL REPORTERS (916) 923-5447 237