Monterey Peninsula Water Management District

The Monterey Peninsula Water Management District rented a hotel conference room on Nov. 12, 2019 for a public presentation making the case that buying out California American Water's local system would be feasible.  

A closely watched and consequential vote on a controversial Monterey Peninsula water issue concluded, uncharacteristically, with a unanimous decision. 

At its Dec. 16 meeting, the board of the Monterey Peninsula Water Management District heard the usual cacophony of public comment. It then proceeded to approve spending $1.2 million over the next six months on a plan to buy out California American Water and bring the local water system under public control.

Cal Am has spent millions to oppose the public ownership movement, but if the company has any allies on the board, they didn’t out themselves by voting against the funding. Even board member, Gary Hoffmann, who has echoed Cal Am’s allegation of bias against the district’s general manager, voted to proceed with the buyout process.

(Hoffmann had asked for an investigation into Dave Stoldt. After a quick internal review cleared Stoldt of wrongdoing, the board had no appetite for further inquiry.) 

The buyout process was triggered by voters last November when they approved Measure J. The ballot initiative directs the water district to pursue public ownership of all water systems in its jurisdiction—if feasible. 

This past November, the district published the results of an analysis by private-sector consultants, who found that a public buyout appears to be feasible and would likely reduce the cost of water to ratepayers. 

This conclusion, however, was not enough to satisfy the definition of feasibility adopted by the board. Before proceeding, the board wants an analysis of whether an attempt to wrest control from Cal Am would likely prevail in a bench trial. 

The new funding approved on Dec. 16 would pay for the work leading up to a formal appraisal of the Peninsula’s water system. In addition to the appraisal work, consultants hired by the district will examine several other aspects of the buyout process. They will provide a more detailed projection of future water rates, lay out the legal infrastructure for a likely eminent domain proceeding, and craft a business and operations plan for the future of the water system.

This process will take until the summer, at which point the board will hold another vote and decide whether to make an offer to Cal Am.

“The additional analysis will allow the board to make a more informed decision,” Stoldt says. 

Asaf Shalev is a staff writer at the Monterey County Weekly. He covers the environment, agriculture and K-12 education, as well as Seaside, Marina, Sand City, Big Sur and Carmel Valley.

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