State’s cease-and-desist order turns up the heat on Cal Am.

The state water board’s advisory team released a draft cease-and-desist order July 27, alleging California American Water has failed to comply with a 14-year-old order to stop illegally overdrafting the Carmel River.

The water board’s draft order comes when Cal Am is already on the defense, following a July 9 California Public Utilities Commission order to better monitor pipeline leaks and reduce the use of potable water for irrigation, among other measures.

Complicating an already murky scenario, the water board’s July draft comes 18 months after the release of a more severe version directing Cal Am to reduce Carmel River diversions by 15 percent for two years, and completely halt unauthorized diversions within five years.

The recent draft is mellower, ordering Cal Am to ratchet down diversions by 5 percent (or 549 acre-feet per year) in October, followed by annual reductions of 121 acre-feet per year through 2014, then further curbs of 242 acre-feet per year until Cal Am is within its lawful river diversion limits. The draft also directs Cal Am to implement water conservation measures and find alternative water supplies.

State Water Resources Control Board spokesman Bill Rukeyser says the water board’s prosecution team wrote the January 2008 draft, while the impartial and more influential quasi-judicial team prepared the July 2009 version.

“When a prosecution team prepares its order, it’s saying, ‘If we could get everything we wanted, here’s our shopping list,’” Rukeyser says. “This draft was prepared by the team that does not have a dog in the fight. They are working for the judges. This is a giant step closer to finality.”

Any order the board adopts will carry the force of law, he adds.

The draft order alleges Cal Am has not complied with a 1995 mandate to stop illegally diverting 10,730 acre-feet per year from the Carmel River. Today Cal Am is still taking more than 7,000 unauthorized acre-feet per year, according to the order.

Cal Am spokeswoman Catherine Bowie says the company has not violated the 1995 order, and that the cutbacks are unnecessary.

“This community has done an incredible job at conserving water, and we think it would be an injustice to our customers to ask them to reduce more without providing an alternative water supply,” she says. “We’ve done everything we can to get a new water supply.”

Since the early 1990s, the community has cut back water use by more than 30 percent, she says, citing Pebble Beach’s water recycling system, a program to store winter flows in the Seaside Basin, rebates for water conservation technology, and a new rate structure that levies steep fees on water hogs.

George Riley, co-founder of Citizens for Public Water, says the draft order is “good for the river, it’s good for the steelhead, it’s good for moving ahead on the supply plans. But it’s bad for the ratepayers,” he adds. “Because Cal Am has not planned ahead sufficiently to pay for their liabilities, ratepayers are gonna have to pay through the nose for all the deficiencies Cal Am has practiced over the past 10 years.”

Although state orders to reduce Cal Am’s river diversions are nothing new, Riley says this one could stick.

“Cal Am’s being called on the carpet here,” he says. “[Water board staff] have moderated this cease-and-desist order considerably, but the fact that they have not backed off means this one is serious and likely to go into effect.”

Peninsula developers could feel the burn, he adds. “The restriction on not serving new customers is a restriction on growth, and that’s gonna be felt.”

The water board’s Sept. 2 public workshop on the draft order will be webcast live at www.calepa.ca.gov/broadcast.