Seeking clarity on how to lift a cease-and-desist order on Peninsula water, a private meeting brings the state water board to Monterey.

Water woes on the Monterey Peninsula go back for decades. In 1995, the State Water Resources Control Board issued Order 95-10, declaring that California American Water was entitled to take only 3,376 acre-feet of water a year from the Carmel River. The utility at the time was taking about 14,000 acre-feet to supply the region. 

Over the subsequent years, seeing little progress toward a solution, the state water board upped the ante. A 2009 update to the cease-and-desist order prohibited new water connections until Cal Am was pumping within its legal limit. That meant putting the pressure on conservation measures to simply use less water, and also the pursuit of a replacement water supply. 

It’s the latter that today, 30 years after the original cease-and-desist order, remains a point of contention. 

While there is an ongoing dispute about how much water the Monterey Peninsula actually needs, and how to develop that supply (and at what cost), there is no dispute that Cal Am has been pumping within its legal limit for the past three years, since 2021. 

That fact has led a number of local stakeholders to ask the state board to suspend or amend the cease-and-desist order, again allowing new water hookups, specifically development of much-needed new housing. 

In 2021, the Monterey Peninsula Water Management District asked the state water board for relief to build more affordable housing. In 2022, the water board responded with a firm nope. 

In the confusion about how to free up water when Cal Am is finally, for the first time in decades, pumping within its legal limit, State Sen. John Laird, D-Santa Cruz, invited Erik Ekdahl, deputy director for the water board’s Division of Water Rights, to a roundtable meeting in Monterey. It finally came to be two years later, on Friday, July 26, 2024. The invitation list to the invite-only meeting included 56 people from a range of interests including local government, agriculture, the Peninsula business community and Public Water Now. All six Peninsula mayors and both county supervisors representing the Peninsula were invited. Ekdahl was invited to present, along with three key players: Kevin Tilden, president of Cal Am; Dave Stoldt, general manager of the Monterey Peninsula Water Management District; and Paul Sciuto, general manager of Monterey One Water. 

Stoldt says he made the case that the state should lift the order, given that for three years running, Cal Am has been within its legal limit. “You cannot be kept in jail for a crime you’re not committing,” Stoldt says. “We don’t have to solve the desal-versus-no-desal issue. We just need consent from the state water board that there’s no current evidence that you need to be kept in jail.” 

Despite Stoldt’s assessment and other similar assessments from attendees that the Weekly spoke to after the meeting, Ekdahl says it’s not so clear cut. He points to the language of the cease-and-desist order itself: It calls for Cal Am to prove “a permanent supply of water that has been substituted for the water illegally diverted from the Carmel River.” 

What counts as permanent, however, remains undecided, including by the state water board. 

“The board is not going to put its thumb on the scale of one particular project,” Ekdahl says. “The emphasis is on a permanent replacement.”

From the state board’s perspective, some data points are unambiguous: Cal Am’s annual reporting on its take from the river, and that since 2021 it has met its legal obligation; and the production so far from Pure Water Monterey, a recycled water project at Monterey One Water. The data that is harder to agree upon is the data about future use, and whether Pure Water Monterey can generate enough to qualify as a “permanent replacement.” How permanent, and how much water? 

“Where it gets grayer is future, projected demand,” Ekdahl says. “What we don’t know is projected future demand, which the community needs to work on.”

There's the issue of Cal Am arguing that a desalination plant is critical in establishing a permanent replacement supply. And when it comes to the major alternative—recycled water from Pure Water Monterey—agricultural stakeholders in the Salinas Valley raise questions about their water rights over the Peninsula.

"Pure Water Monterey has been operating for four-and-a-half years, and we haven’t had significant or longterm outages," Sciuto says. "It just proves the technology is there, and we are operating it properly—I have all the confidence in our people."

The forthcoming Pure Water Monterey expansion project is expected to operate as the equivalent of a "peaker" power plant, in times of high demand. But the state board will want to see evidence of past performance, not just the promise of future supply—and there's the issue of first-in-line growers. "Contractually they have the right [to that water]," Sciuto says. "But practically and economically, would that ever happen?" Unless local agriculture changed significantly—such as a transition from season to year-round crops—there should be enough water for the expansion project. 

One thing that was unambiguously established at the July 26 meeting is that Cal Am, the utility, is not the only entity in a position to request relief from the cease-and-desist order; any aggrieved party can do that. Stoldt says the water district intends to file a request for relief later this year, showing there is sufficient replacement water. 

The California Public Utilities Commission is revisiting its analysis of future supply/demand projections, and the forthcoming analysis may or may not give a clear picture to the state board in defining “permanent supply.” 

“How do you define permanent supply? That is the question,” Ekdahl says. “Unfortunately, we can’t really answer that—I don’t have an exact number. It’s not just a clear, bright line.” 

The future supply analysis has been a thorny issue for various stakeholders. Stoldt’s analysis showed a previous CPUC analysis was far in excess of what is really needed; Cal Am says Stoldt’s analysis fails to account for pent-up demand for water. The forthcoming CPUC analysis may resolve some of these outstanding questions, or it may not. 

"The bottom line is, if people can come to some agreement on water supply, there’s a path to come back to the water board," Laird says. "That’s the best we could’ve hoped for." 

In short, as Ekdahl says, there’s no clear answer on how much water the Peninsula needs—but consensus around the required supply to define "permanent" would certainly help. What the state water board promises to do is be a neutral third party when it comes to deciding whether the unclear line has been met. “If [an applicant for relief from the cease-and-desist order] comes to us with numbers that don’t pass the laugh test, we are going to call them on it,” Ekdahl says. “When we put it through the public ringer, the cracks emerge.”