0652 01 02 03 04 05 STATE WATER RESOURCES CONTROL BOARD 06 07 08 09 PUBLIC HEARING 10 11 12 12 1998 BAY-DELTA WATER RIGHTS HEARING 13 14 15 16 HELD AT: 17 RESOURCES BUILDING 17 1416 NINTH STREET 18 FIRST FLOOR AUDITORIUM 18 SACRAMENTO, CALIFORNIA 19 19 20 20 21 WEDNESDAY, JULY 15, 1998 21 9:00 A.M. 22 22 23 23 24 Reported by: ESTHER F. WIATRE 24 CSR NO. 1564 25 25 0653 01 APPEARANCES 01 BOARD MEMBERS: 02 02 JOHN CAFFREY, COHEARING OFFICER 03 JAMES STUBCHAER, COHEARING OFFICER 03 JOHN W. BROWN 04 MARY JANE FORSTER 04 05 STAFF MEMBERS: 05 06 WALTER PETTIT, EXECUTIVE DIRECTOR 06 VICTORIA WHITNEY, CHIEF BAY-DELTA UNIT 07 THOMAS HOWARD, SUPERVISING ENGINEER 07 08 COUNSEL: 08 09 WILLIAM R. ATTWATER, CHIEF COUNSEL 09 BARBARA LEIDIGH 10 10 11 11 12 12 13 13 14 14 15 15 16 16 17 17 18 18 19 19 20 20 21 21 22 22 23 23 24 24 25 25 0654 01 REPRESENTATIVES 01 02 PRINCETON CODORA GLENN IRRIGATION DISTRICT, et al.: 02 03 FROST, DRUP & ATLAS 03 134 West Sycamore Street 04 Willows, California 95988 04 BY: J. MARK ATLAS, ESQ. 05 05 JOINT WATER DISTRICTS: 06 06 MINASIAN, SPRUANCE, BABER, MEITH, SOARES & SEXTON: 07 P.O. BOX 1679 07 Oroville, California 95965 08 BY: WILLIAM H. BABER III, ESQ. 08 09 CALIFORNIA SPORTFISHING PROTECTION ALLIANCE: 09 10 ROBERT J. BAIOCCHI 10 P.O. Box 357 11 Quincy, California 11 12 BELLA VISTA WATER DISTRICT: 12 13 BRUCE L. BELTON, ESQ. 13 2525 Park Marina Drive, Suite 102 14 Redding, California 96001 14 15 WESTLANDS WATER DISTRICT: 15 16 KRONICK, MOSKOVITZ, TIEDEMANN & GIRARD 16 400 Capitol Mall, 27th Floor 17 Sacramento, California 95814 17 BY: THOMAS W. BIRMINGHAM, ESQ. 18 18 THE BAY INSTITUTE OF SAN FRANCISCO: 19 19 GARY BOBKER 20 55 Shaver Street, Suite 330 20 San Rafael, California 94901 21 21 CITY OF ANTIOCH, et al.: 22 22 FREDERICK BOLD, JR., ESQ. 23 1201 California Street, Suite 1303 23 San Francisco, California 94109 24 24 25 25 0655 01 REPRESENTATIVES 01 02 LEAGUE OF WOMEN VOTERS: 02 03 ROBERTA BORGONOVO 03 2480 Union Street 04 San Francisco, California 94123 04 05 UNITED STATES DEPARTMENT OF THE INTERIOR: 05 06 OFFICE OF THE SOLICITOR 06 2800 Cottage Way, Room E1712 07 Sacramento, California 95825 07 BY: ALF W. BRANDT, ESQ. 08 CALIFORNIA URBAN WATER AGENCIES: 08 09 BYRON M. BUCK 09 455 Capitol Mall, Suite 705 10 Sacramento, California 95814 10 11 RANCHO MURIETA COMMUNITY SERVICES DISTRICT: 11 12 MCDONOUGH, HOLLAND & ALLEN 12 555 Capitol Mall, 9th Floor 13 Sacramento, California 95814 13 BY: VIRGINIA A. CAHILL, ESQ. 14 14 CALIFORNIA DEPARTMENT OF FISH AND GAME: 15 15 OFFICE OF ATTORNEY GENERAL 16 1300 I Street, Suite 1101 16 Sacramento, California 95814 17 BY: MATTHEW CAMPBELL, ESQ. 17 18 NATURAL RESOURCES DEFENSE COUNCIL: 18 19 HAMILTON CANDEE, ESQ. 19 71 Stevenson Street 20 San Francisco, California 94105 20 21 ARVIN-EDISON WATER STORAGE DISTRICT, et al.: 21 22 DOOLEY HERR & WILLIAMS 22 3500 West Mineral King Avenue, Suite C 23 Visalia, California 93291 23 BY: DANIEL M. DOOLEY, ESQ. 24 24 25 25 0656 01 REPRESENTATIVES 01 02 SACRAMENTO MUNICIPAL UTILITY DISTRICT: 02 03 LESLIE A. DUNSWORTH, ESQ. 03 6201 S Street 04 Sacramento, California 95817 04 05 SOUTH SAN JOAQUIN IRRIGATION DISTRICT, et al.: 05 06 BRAY, GEIGER, RUDQUIST & NUSS 06 311 East Main Street, 4th Floor 07 Stockton, California 95202 07 BY: STEVEN P. EMRICK, ESQ. 08 08 EAST BAY MUNICIPAL UTILITY DISTRICT: 09 09 EBMUD OFFICE OF GENERAL COUNSEL 10 375 Eleventh Street 10 Oakland, California 94623 11 BY: FRED S. ETHERIDGE, ESQ. 11 12 GOLDEN GATE AUDUBON SOCIETY: 12 13 ARTHUR FEINSTEIN 13 2530 San Pablo Avenue, Suite G 14 Berkeley, California 94702 14 15 CONAWAY CONSERVANCY GROUP: 15 16 UREMOVIC & FELGER 16 P.O. Box 5654 17 Fresno, California 93755 17 BY: WARREN P. FELGER, ESQ. 18 18 THOMES CREEK WATER ASSOCIATION: 19 19 THOMES CREEK WATERSHED ASSOCIATION 20 P.O. Box 2365 20 Flournoy, California 96029 21 BY: LOIS FLYNNE 21 22 COURT APPOINTED REPS OF WESTLANDS WD AREA 1, et al.: 22 23 LAW OFFICES OF SMILAND & KHACHIGIAN 23 601 West Fifth Street, Seventh Floor 24 Los Angeles, California 90075 24 BY: CHRISTOPHER G. FOSTER, ESQ. 25 25 0657 01 REPRESENTATIVES 01 02 CITY AND COUNTY OF SAN FRANCISCO: 02 03 OFFICE OF THE CITY ATTORNEY 03 1390 Market Street, Sixth Floor 04 San Francisco, California 94102 04 BY: DONN W. FURMAN, ESQ. 05 05 CAMP FAR WEST IRRIGATION DISTRICT, et al.: 06 06 DANIEL F. GALLERY, ESQ. 07 926 J Street, Suite 505 07 Sacramento, California 95814 08 08 BOSTON RANCH COMPANY, et al.: 09 09 J.B. BOSWELL COMPANY 10 101 West Walnut Street 10 Pasadena, California 91103 11 BY: EDWARD G. GIERMANN 11 12 SAN JOAQUIN RIVER GROUP AUTHORITY, et al.: 12 13 GRIFFTH, MASUDA & GODWIN 13 517 East Olive Street 14 Turlock, California 95381 14 BY: ARTHUR F. GODWIN, ESQ. 15 15 NORTHERN CALIFORNIA WATER ASSOCIATION: 16 16 RICHARD GOLB 17 455 Capitol Mall, Suite 335 17 Sacramento, California 95814 18 18 PLACER COUNTY WATER AGENCY, et al.: 19 19 KRONICK, MOSKOVITZ, TIEDEMANN & GIRARD 20 400 Capitol Mall, 27th Floor 20 Sacramento, California 95814 21 BY: JANET GOLDSMITH, ESQ. 21 22 ENVIRONMENTAL DEFENSE FUND: 22 23 THOMAS J. GRAFF, ESQ. 23 5655 College Avenue, Suite 304 24 Oakland, California 94618 24 25 25 0658 01 REPRESENTATIVES 01 02 CALAVERAS COUNTY WATER DISTRICT: 02 03 SIMON GRANVILLE 03 P.O. Box 846 04 San Andreas, California 95249 04 05 CHOWCHILLA WATER DISTRICT, et al.: 05 06 GREEN, GREEN & RIGBY 06 P.O. Box 1019 07 Madera, California 93639 07 BY: DENSLOW GREEN, ESQ. 08 08 CALIFORNIA FARM BUREAU FEDERATION: 09 09 DAVID J. GUY, ESQ. 10 2300 River Plaza Drive 10 Sacramento, California 95833 11 11 SANTA CLARA VALLEY WATER DISTRICT: 12 12 MORRISON & FORESTER 13 755 Page Mill Road 13 Palo Alto, California 94303 14 BY: KEVIN T. HAROFF, ESQ. 14 15 CITY OF SHASTA LAKE: 15 16 ALAN N. HARVEY 16 P.O. Box 777 17 Shasta Lake, California 96019 17 18 COUNTY OF STANISLAUS: 18 19 MICHAEL G. HEATON, ESQ. 19 926 J Street 20 Sacramento, California 95814 20 21 GORRILL LAND COMPANY: 21 22 GORRILL LAND COMPANY 22 P.O. Box 427 23 Durham, California 95938 23 BY: DON HEFFREN 24 24 25 25 0659 01 REPRESENTATIVES 01 02 SOUTH DELTA WATER AGENCY: 02 03 JOHN HERRICK, ESQ. 03 3031 West March Lane, Suite 332 East 04 Stockton, California 95267 04 05 COUNTY OF GLENN: 05 06 NORMAN Y. HERRING 06 525 West Sycamore Street 07 Willows, California 95988 07 08 REGIONAL COUNCIL OF RURAL COUNTIES: 08 09 MICHAEL B. JACKSON 09 1020 Twelfth Street, Suite 400 10 Sacramento, California 95814 10 11 DEER CREEK WATERSHED CONSERVANCY: 11 12 JULIE KELLY 12 P.O. Box 307 13 Vina, California 96092 13 14 DELTA TRIBUTARY AGENCIES COMMITTEE: 14 15 MODESTO IRRIGATION DISTRICT 15 P.O. Box 4060 16 Modesto, California 95352 16 BY: BILL KETSCHER 17 17 SAVE THE SAN FRANCISCO BAY ASSOCIATION: 18 18 SAVE THE BAY 19 1736 Franklin Street 19 Oakland, California 94612 20 BY: CYNTHIA L. KOEHLER, ESQ. 20 21 BATTLE CREEK WATERSHED LANDOWNERS: 21 22 BATTLE CREEK WATERSHED CONSERVANCY 22 P.O. Box 606 23 Manton, California 96059 23 24 24 25 25 0660 01 REPRESENTATIVES 01 02 BUTTE SINK WATERFOWL ASSOCIATION, et al.: 02 03 MARTHA H. LENNIHAN, ESQ. 03 455 Capitol Mall, Suite 300 04 Sacramento, California 95814 04 05 CITY OF YUBA CITY: 05 06 WILLIAM P. LEWIS 06 1201 Civic Center Drive 07 Yuba City 95993 07 08 BROWNS VALLEY IRRIGATION DISTRICT, et al.: 08 09 BARTKIEWICZ, KRONICK & SHANAHAN 09 1011 22nd Street, Suite 100 10 Sacramento, California 95816 10 BY: ALAN B. LILLY, ESQ. 11 11 CONTRA COSTA WATER DISTRICT: 12 12 BOLD, POLISNER, MADDOW, NELSON & JUDSON 13 500 Ygnacio Valley Road, Suite 325 13 Walnut Creek, California 94596 14 BY: ROBERT B. MADDOW, ESQ. 14 15 GRASSLAND WATER DISTRICT: 15 16 DON MARCIOCHI 16 22759 South Mercey Springs Road 17 Los Banos, California 93635 17 18 SAN LUIS CANAL COMPANY: 18 19 FLANAGAN, MASON, ROBBINS & GNASS 19 3351 North M Street, Suite 100 20 Merced, California 95344 20 BY: MICHAEL L. MASON, ESQ. 21 21 STONY CREEK BUSINESS AND LAND OWNERS COALITION: 22 22 R.W. MCCOMAS 23 4150 County Road K 23 Orland, California 95963 24 24 25 25 0661 01 REPRESENTATIVES 01 02 TRI-DAM POWER AUTHORITY: 02 03 TUOLUMNE UTILITIES DISTRICT 03 P.O. Box 3728 04 Sonora, California 95730 04 BY: TIM MCCULLOUGH 05 05 DELANO-EARLIMART IRRIGATION DISTRICT, et al.: 06 06 MINASIAN, SPRUANCE, BABER, MEITH, SOARES & SEXTON 07 P.O. Box 1679 07 Oroville, California 95965 08 BY: JEFFREY A. MEITH, ESQ. 08 09 HUMANE FARMING ASSOCIATION: 09 10 BRADLEY S. MILLER 10 1550 California Street, Suite 6 11 San Francisco, California 94109 11 12 CORDUA IRRIGATION DISTRICT, et al.: 12 13 MINASIAN, SPRUANCE, BABER, MEITH, SOARES & SEXTON 13 P.O. Box 1679 14 Oroville, California 95965 14 BY: PAUL R. MINASIAN, ESQ. 15 15 EL DORADO COUNTY WATER AGENCY: 16 16 DE CUIR & SOMACH 17 400 Capitol Mall, Suite 1900 17 Sacramento, California 95814 18 BY: DONALD B. MOONEY, ESQ. 18 19 GLENN COUNTY FARM BUREAU: 19 20 STEVE MORA 20 501 Walker Street 21 Orland, California 95963 21 22 MODESTO IRRIGATION DISTRICT: 22 23 JOEL MOSKOWITZ 23 P.O. Box 4060 24 Modesto, California 95352 24 25 25 0662 01 REPRESENTATIVES 01 02 PACIFIC GAS & ELECTRIC: 02 03 RICHARD H. MOSS, ESQ. 03 P.O. Box 7442 04 San Francisco, California 94120 04 05 CENTRAL DELTA WATER AGENCY, et al.: 05 06 NOMELLINI, GRILLI & MCDANIEL 06 P.O. Box 1461 07 Stockton, California 95201 07 BY: DANTE JOHN NOMELLINI, ESQ. 08 and 08 DANTE JOHN NOMELLINI, JR., ESQ. 09 09 TULARE LAKE BASIN WATER STORAGE UNIT: 10 10 MICHAEL NORDSTROM 11 1100 Whitney Avenue 11 Corcoran, California 93212 12 12 AKIN RANCH, et al.: 13 13 DOWNEY, BRAND, SEYMOUR & ROHWER 14 555 Capitol Mall, 10th Floor 14 Sacramento, California 95814 15 BY: KEVIN M. O'BRIEN, ESQ. 15 16 OAKDALE IRRIGATION DISTRICT: 16 17 O'LAUGHLIN & PARIS 17 870 Manzanita Court, Suite B 18 Chico, California 95926 18 BY: TIM O'LAUGHLIN, ESQ. 19 19 SIERRA CLUB: 20 20 JENNA OLSEN 21 85 Second Street, 2nd Floor 21 San Francisco, California 94105 22 22 YOLO COUNTY BOARD OF SUPERVISORS: 23 23 LYNNEL POLLOCK 24 625 Court Street 24 Woodland, California 95695 25 25 0663 01 REPRESENTATIVES 01 02 PATRICK PORGENS AND ASSOCIATES: 02 03 PATRICK PORGENS 03 P.O. Box 60940 04 Sacramento, California 95860 04 05 BROADVIEW WATER DISTRICT, et al.: 05 06 DIANE RATHMANN 06 07 FRIENDS OF THE RIVER: 07 08 BETSY REIFSNIDER 08 128 J Street, 2nd Floor 09 Sacramento, California 95814 09 10 MERCED IRRIGATION DISTRICT: 10 11 FLANAGAN, MASON, ROBBINS & GNASS 11 P.O. Box 2067 12 Merced, California 95344 12 BY: KENNETH M. ROBBINS, ESQ. 13 13 CENTRAL SAN JOAQUIN WATER CONSERVATION DISTRICT: 14 14 REID W. ROBERTS, ESQ. 15 311 East Main Street, Suite 202 15 Stockton, California 95202 16 16 METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA: 17 17 JAMES F. ROBERTS 18 P.O. Box 54153 18 Los Angeles, California 90054 19 19 SACRAMENTO AREA WATER FORUM: 20 20 CITY OF SACRAMENTO 21 980 9th Street, 10th Floor 21 Sacramento, California 95814 22 BY: JOSEPH ROBINSON, ESQ. 22 23 23 24 24 25 25 0664 01 REPRESENTATIVES 01 02 TUOLUMNE RIVER PRESERVATION TRUST: 02 03 NATURAL HERITAGE INSTITUTE 03 114 Sansome Street, Suite 1200 04 San Francisco, California 94194 04 BY: RICHARD ROOS-COLLINS, ESQ. 05 05 CALIFORNIA DEPARTMENT OF WATER RESOURCES: 06 06 DAVID A. SANDINO, ESQ. 07 P.O. Box 942836 07 Sacramento, California 94236 08 08 FRIANT WATER USERS AUTHORITY: 09 09 GARY W. SAWYERS, ESQ. 10 575 East Alluvial, Suite 101 10 Fresno, California 93720 11 11 KERN COUNTY WATER AGENCY: 12 12 KRONICK, MOSKOVITZ, TIEDEMANN & GIRARD 13 400 Capitol Mall, 27th Floor 13 Sacramento, California 95814 14 BY: CLIFFORD W. SCHULZ, ESQ. 14 15 SAN JOAQUIN RIVER EXCHANGE CONTRACTORS: 15 16 MINASIAN, SPRUANCE, BABER, MEITH, SOARES & SEXTON: 16 P.O. Box 1679 17 Oroville, California 95965 17 BY: MICHAEL V. SEXTON, ESQ. 18 18 SAN JOAQUIN COUNTY: 19 19 NEUMILLER & BEARDSLEE 20 P.O. Box 20 20 Stockton, California 95203 21 BY: THOMAS J. SHEPHARD, SR., ESQ. 21 22 CITY OF STOCKTON: 22 23 DE CUIR & SOMACH 23 400 Capitol Mall, Suite 1900 24 Sacramento, California 95814 24 BY: PAUL S. SIMMONS, ESQ. 25 25 0665 01 REPRESENTATIVES 01 02 ORLAND UNIT WATER USERS' ASSOCIATION: 02 03 MINASIAN, SPRUANCE, BABER, MEITH, SOARES & SEXTON 03 P.O. Box 1679 04 Oroville, California 95965 04 BY: M. ANTHONY SOARES, ESQ. 05 05 GLENN-COLUSA IRRIGATION DISTRICT: 06 06 DE CUIR & SOMACH 07 400 Capitol Mall, Suite 1900 07 Sacramento, California 95814 08 BY: STUART L. SOMACH, ESQ. 08 09 NORTH SAN JOAQUIN WATER CONSERVATION DISTRICT: 09 10 JAMES F. SORENSEN CONSULTING CIVIL ENGINEER, INC. 10 209 South Locust Street 11 Visalia, California 93279 11 BY: JAMES F. SORENSEN 12 12 PARADISE IRRIGATION DISTRICT: 13 13 MINASIAN, SPRUANCE, BABER, MEITH, SOARES & SEXTON 14 P.O. Box 1679 14 Oroville, California 95695 15 BY: WILLIAM H. SPRUANCE, ESQ. 15 16 COUNTY OF COLUSA: 16 17 DONALD F. STANTON, ESQ. 17 1213 Market Street 18 Colusa, California 95932 18 19 COUNTY OF TRINITY: 19 20 COUNTY OF TRINITY - NATURAL RESOURCES 20 P.O. Box 156 21 Hayfork, California 96041 21 BY: TOM STOKELY 22 22 CITY OF REDDING: 23 23 JEFFERY J. SWANSON, ESQ. 24 2515 Park Marina Drive, Suite 102 24 Redding, California 96001 25 25 0666 01 REPRESENTATIVES 01 02 TULARE IRRIGATION DISTRICT: 02 03 TEHAMA COUNTY RESOURCE CONSERVATION DISTRICT 03 2 Sutter Street, Suite D 04 Red Bluff, California 96080 04 BY: ERNEST E. WHITE 05 05 STATE WATER CONTRACTORS: 06 06 BEST BEST & KREIGER 07 P.O. Box 1028 07 Riverside, California 92502 08 BY: GREGORY WILKINSON, ESQ. 08 09 COUNTY OF TEHAMA, et al.: 09 10 COUNTY OF TEHAMA BOARD OF SUPERVISORS: 10 P.O. Box 250 11 Red Bluff, California 96080 11 BY: CHARLES H. WILLARD 12 12 MOUNTAIN COUNTIES WATER RESOURCES ASSOCIATION: 13 13 CHRISTOPHER D. WILLIAMS 14 P.O. Box 667 14 San Andreas, California 95249 15 15 JACKSON VALLEY IRRIGATION DISTRICT: 16 16 HENRY WILLY 17 6755 Lake Amador Drive 17 Ione, California 95640 18 18 SOLANO COUNTY WATER AGENCY, et al.: 19 19 HERUM, CRABTREE, DYER, ZOLEZZI & TERPSTRA 20 2291 West March Lane, S.B.100 20 Stockton, California 95207 21 BY: JEANNE M. ZOLEZZI, ESQ. 21 22 ---oOo--- 22 23 23 24 24 25 25 0667 01 INDEX 01 02 PAGE 02 03 POLICY STATEMENTS: 03 04 SENATOR DICK MONTEITH 669 04 ASSEMBLY MEMBER DENNIS CARDOZA 05 BY DOMINIC DIMARRE 672 05 SENATOR JIM COSTA 686 06 06 07 STATEMENTS/ARGUMENTS 07 08 TOM O'LAUGHLIN 674 08 MICHAEL SEXTON 694 09 HAMILTON CANDEE 695 09 KENNETH ROBBINS 704 10 MICHAEL JACKSON 705 10 DANTE JOHN NOMELLINI 711 11 JOHN HERRICK 715 11 ROBERT MADDOW 718 12 VIRGINIA CAHILL 723 12 DANIEL SUYEYASU 726 13 ALAN LILY 731 13 PATRICK PORGENS 741 14 CLIFFORD SCHULZ 747 14 FRED ETHERIDGE 750 15 15 ---oOo--- 16 16 17 17 18 18 19 19 20 20 21 21 22 22 23 23 24 24 25 25 0668 01 SACRAMENTO, CALIFORNIA 02 WEDNESDAY, JULY 15, 1998 03 ---oOo--- 04 C.O. CAFFREY: Please take your seats, and we will 05 begin. 06 We are on the record. Good morning. 07 This is the continuation of the Delta water rights 08 hearing. For those of you that were not present for Phase 09 I, today we begin Phase II of the hearing and that is 10 consideration of San Joaquin River Agreement. 11 By way of introduction for those of you who have not 12 been with us for the early portion, my name is John Caffrey, 13 and I have the honor of serving as Chair of the State Water 14 Resources Control Board. Introducing the people at the 15 dais, to the audience's far right is our Chief Counsel, Bill 16 Attwater. Next to Mr. Attwater is the Board's Executive, 17 Walt Pettit. 18 To my immediate left is Board Member Mary Jane Forster. 19 MEMBER FORSTER: Morning. 20 C.O. CAFFREY: Usually to Ms. Forster's left is Board 21 Member Marc Del Piero, our legal counsel. Mr. Del Piero is 22 traveling abroad and will join us for future phases. 23 To my immediate right is the Board's Vice Chair, Jim 24 Stubchaer. Mr. Stubchaer is also serving with me as 25 cohearing officer. 0669 01 Next to Mr. Stubchaer is Board Member John Brown. 02 Again, good morning to all. We are going to start 03 today's proceedings as a courtesy to the Legislature and 04 hear from various members of the Legislature who wish to 05 make policy statements regarding our process. I think that 06 various members may be joining us throughout today's 07 proceedings. 08 We are honored to have Senator Monteith with us 09 already. 10 Senator, please come forward and give us your 11 statement. 12 SENATOR MONTEITH: Thank you. 13 C.O. CAFFREY: Good morning, sir, welcome. 14 SENATOR MONTEITH: Thank you. Another great cold 15 morning. 16 Good morning, Chairman Caffrey and Members of the 17 Board. I want to thank you for the opportunity to appear 18 before you. On behalf of my constituents, I'd like to 19 express my support for the San Joaquin River Agreement. I 20 believe that it is a fair and even-handed approach to the 21 Bay-Delta problems of salmon survival. 22 The San Joaquin River Agreement provides a unique 23 package of measures that will result in fishery protection 24 while avoiding Water Board's lawsuits, political wrangling 25 and continual disagreement. This agreement combines 0670 01 immediate fishery protection in the San Joaquin River Basin 02 to the levels established by this Board, a method for 03 studying and evaluating the relationship of San Joaquin 04 River flow to salmon survival in the future. And the 05 voluntary participation of the major water right holders in 06 the San Joaquin River Basin. 07 And I must tell you that I am greatly encouraged by 08 this agreement. As a life-long resident of Central Valley, 09 I am no stronger to the water boards between agricultural, 10 urban and environmental interests. But these groups, 11 through hard work and cooperation, they have set aside their 12 differences and hammered out an agreement that provides a 13 salmon protection slot by this Board. 14 Given this participation of all interested parties in 15 the formulation of this agreement and the immediate need of 16 the salmon fishery, the San Joaquin River Agreement is a 17 golden opportunity to solve the salmon survival problems in 18 the San Joaquin River Basin. Therefore, I encourage you to 19 adopt it, this agreement, and implement it as soon as 20 possible. 21 Thank you. 22 C.O. CAFFREY: Thank you very much, Senator, for taking 23 the time to share your concerns and thoughts with us and to 24 place them into the record; we appreciate it. 25 SENATOR MONTEITH: It is always a pleasure, and I thank 0671 01 you for your time. 02 C.O. CAFFREY: Are there any other representatives of 03 any member of the Legislature here in the audience that 04 wishes to make a policy statement before the Board? 05 Staff representing members or members? 06 All right. Thank you. 07 Just to go over again what we will do today; I had said 08 earlier that we would start this morning by calling for 09 appearances again. We will put that off until tomorrow. 10 Tomorrow we will have an updated list to give to all of you 11 so you can go over it, and we will go through the same 12 process that we did last time for those that have not yet 13 made their appearances. So, we will have the document, and 14 you can check to see if we have your correct address and 15 other pertinent information. So we will do that tomorrow. 16 What we will do today is to hear the motion and hear 17 the arguments on Mr. O'Laughlin's motion and hear from all 18 the parties with regard to that subject. And then the Board 19 will recess for the day and come back tomorrow, hopefully 20 having ruled this afternoon. 21 Mr. O'Laughlin, did you have something that you -- 22 MR. O'LAUGHLIN: Yes. Another member from the 23 Legislature would like to speak to the Board. 24 C.O. CAFFREY: Who is here? 25 MR. O'LAUGHLIN: Dominic DiMarre. 0672 01 C.O. CAFFREY: Good morning, sir. Welcome. 02 MR. DIMARRE: Good morning, Mr. Chairman. My name is 03 Dominic DiMarre, and I am here on behalf of Assembly Member 04 Dennis Cardoza who sends his regrets for not being able to 05 attend this morning, but he was taken away at the last 06 moment by some budget meetings. 07 C.O. CAFFREY: Hopefully, he is hard at work solving 08 the budget problems. 09 MR. DIMARRE: Hopefully. 10 C.O. CAFFREY: Welcome, sir. Thank you for being here. 11 MR. DIMARRE: I have with me a letter from Mr. Cardoza 12 to the Board and to the Chair and in support of the VAMP, 13 and I have just a very brief statement of support from the 14 Assemblyman. 15 C.O. CAFFREY: When you finish your statement, sir, you 16 can hand it to the staff at table, and we will be very happy 17 to receive it. 18 MR. DIMARRE: Thank you very much. 19 Mr. Chairman, Members, on behalf of Assemblyman 20 Cardoza, we are here in support of the agreement. 21 The agreement has occurred because the State Coalition 22 of Agriculture, the environment, urban and regulatory 23 communities came together in a consensus effort to solve the 24 problem. The results of this agreement will not only 25 provide protection to migrating or outmigrating salmon 0673 01 smolts, it will provide for much needed information to 02 assist in the long-term solution, which the committee feels 03 is in the best interest of the Delta and the state as a 04 whole. 05 The San Joaquin River Agreement will provide up to 06 110,000 acre-feet of water during the April-May period for 07 the next 12 years. The water is not coming only from one 08 user, which Mr. Cardoza feels is a very important point to 09 this agreement, but it is divided amongst the participants 10 to the agreement in accordance with an agreement reached 11 among themselves and established by a fixed schedule. The 12 parties are appearing here today before your Board asking 13 for approval on their agreement which will resolve a bitter 14 water dispute. The effort put into reaching this agreement 15 and the potential results that can be achieved by this 16 agreement cannot be understated. 17 Mr. Cardoza, through me, is asking that this Board 18 adopt the agreement so that it may be implemented as soon as 19 possible. With that, that concludes the statement. 20 Thank you for your time and thank you for your 21 attention on this matter, and we hope for a good, positive 22 result. 23 C.O. CAFFREY: Thank you very much for being here, and 24 please express our thanks to Assemblyman Cardoza. We 25 appreciate the entering of his statement into the record. 0674 01 Thank you, sir. 02 Any other Legislative staff here wishing to address the 03 Board or any other members having arrived? 04 Thank you. With that, then, I believe we can hear from 05 Mr. O'Laughlin. I mentioned yesterday that we will allow a 06 half an hour. We will use our timer up here, a half an hour 07 limitation on every argument. 08 The procedures we will follow is after -- when Mr. 09 O'Laughlin completes his argument, then we will hear from 10 the other parties who wish to present argument. Then we 11 will give Mr. O'Laughlin a brief period to respond and to 12 summarize. Then, as I said earlier, we will recess for the 13 rest of the day and do our darnedest, for lack of a better 14 term, to get a written ruling out some time late today. So, 15 it will hopefully be in your hands by the time we convene 16 tomorrow morning at 9:00 a.m. 17 Good morning, Mr. O'Laughlin. Please proceed, sir. 18 MR. O'LAUGHLIN: Good morning, Chairman and Board 19 Members and staff. 20 I just want to represent to you that I am representing 21 the San Joaquin River Group Authority, the members of the 22 San Joaquin River Group Authority comprise South San Joaquin 23 Irrigation District, Oakdale Irrigation District, Modesto 24 Irrigation District, Turlock Irrigation District, Merced 25 Irrigation District, Friant Water Users Authority, the San 0675 01 Joaquin River Exchange Contractors, and the City and County 02 of San Francisco. The counsels for those individual 03 entities are present here today as well. 04 I want to do a little background first before we go 05 into the motion and kind of set the stage for why we are in 06 this present position and what we are asking for. 07 On April 21st the Board held a workshop in regards to 08 looking at the San Joaquin River Agreement as well as other 09 settlements and seeing whether or not those settlements 10 should go forward, in what kind of manner we should go 11 forward in, and whether a phasing of the settlement 12 agreements and the Board process. 13 The San Joaquin River Agreement was presented. It took 14 all day, if you remember. There were numerous questions, 15 comments. The Board deliberated, and on May 6th, 1998 a 16 hearing notice went out. The hearing notice set out a 17 phasing of the hearing for the implementation of the 1995 18 Water Quality Control Plan. Of key concern to the River 19 Group Authority was Phase II which is the San Joaquin River 20 Agreement. 21 The hearing notice, we believe, was very clear. There 22 were some minor, little technical questions that we thought 23 needed to be cleaned up. But, overall, we thought it was 24 that the San Joaquin River Agreement would come before this 25 Board, and there would be a hearing on the merits of the San 0676 01 Joaquin River Agreement, vis-a-vis all the parties, all the 02 parties to the agreement's responsibilities, and all the 03 alternatives. 04 What happened after that is that questions began to 05 come into the State Water Resources Control Board from 06 various parties who were concerned about the hearing notice 07 and had questions about the hearing notice. Subsequently, 08 letters were sent out from the State Water Resources Control 09 Board responding to those inquiries. 10 In late May, a notice went out that the submittal of 11 testimony from the San Joaquin River Agreement Phase II 12 would be delayed until June 15th of 1998, in response to a 13 letter sent by Cynthia Fuller. After that time limit was 14 extended, another letter came out on June 11th, 1998. This 15 is the letter that probably set the stage for this motion 16 more than any other letter. 17 The letter was very helpful in explaining a wide 18 variety of responses to inquires, not only by the San 19 Joaquin River Group Authority, but by Stockton East as 20 well. There was one problem, however, that was posed the in 21 June 11, 1998 letter, in our minds, and that was the 22 response that Phase II would only address the San Joaquin 23 River Agreement and would not address anything else and that 24 any other alternative would be examined later in Phase 25 VIII. 0677 01 In response to that, the State Water Resources Control 02 Board received a letter from NRDC which said that it would 03 wait until Phase VIII to look at the rights and 04 responsibilities of the parties to the San Joaquin River 05 Agreement, vis-a-vis the other alternatives. This put us in 06 a dilemma, and the dilemma is this: 07 The San Joaquin River Group Authority and its members 08 and also the other parties to the San Joaquin River 09 Agreement negotiated for a year and a half to avoid an 10 adversarial hearing between the parties to the hearing. We 11 do not want to participate in Phase VIII. The whole thrust 12 of what we have been doing is to avoid an adversarial 13 hearing between the parties. Given the uncertainty 14 surrounding whether or not the rights and responsibilities 15 of the parties to the agreement would be taken up in Phase 16 II or Phase VIII, we have made the subsequent motion. 17 Our goal in filing the motion is to clarify the process 18 and procedures for a hearing and hopefully implementing the 19 San Joaquin River Agreement. One of our main goals is we do 20 not want to deny anybody the right to comment, respond, put 21 on adverse testimony. We want to insure that the due 22 process of all the parties is covered in this proceeding. 23 Because if we do get an order from the Board, we want to 24 make sure the procedures that have been done to get that 25 order are proper procedures to protect that order from 0678 01 review by a judicial body. 02 So, after we filed the motion several weeks ago, we 03 began discussion with the parties to this proceeding and 04 signatories to the San Joaquin River Agreement. From these 05 discussions came our briefing paper of July 9th, 1998. This 06 paper differed radically from our original motion based on 07 the input we received from numerous parties. 08 When reading the two papers, you will see that the main 09 difference is that in our original papers we were going to 10 strictly abide by what we thought the hearing notice said of 11 May 6, 1998. We wanted to have that Phase II done and over 12 with, and we were asking the State Water Resources Control 13 Board to find that if parties had not submitted their 14 evidence by June 15th that they would be foreclosed from 15 submitting that evidence and to proceed forward with Phase 16 II. 17 After discussion with the parties, though, it became 18 clear that there was much confusion as to the scope and 19 extent of Phase II. We have, therefore, now in our papers 20 suggested a different procedure and process. 21 Since we filed our papers on July 9th, we have had 22 extensive telephone conference calls with numerous parties 23 to the proceeding. Yesterday we were afforded the 24 opportunity, given the early dismissal, to meet once again 25 with parties that were interested in this question, in Mr. 0679 01 O'Brien's office, to further discuss and refine the approach 02 that we have presented to you in our briefing papers, and we 03 will present to you again today. 04 We propose the following: 05 As stated in the NHI brief paper, the sole question for 06 Phase II should be will the San Joaquin River Agreement, 07 quote, provide environmental protection at a level of 08 protection equivalent to the Vernalis flow objectives of the 09 1995 Water Quality Control Plan during the pulse flow period 10 in implementation of the remaining San Joaquin River portion 11 of the 1995 Water Quality Control Plan for the duration of 12 this agreement. 13 That quotation is taken directly from Paragraph 7 of 14 the San Joaquin River Agreement. As explained in Mr. 15 Thomas' paper from NHI, there is a threshold question of 16 equivalency, of equivalent protection, that needs to be 17 found pursuant to the agreement before the agreement can be 18 implemented. 19 The parties to the San Joaquin River Agreement are 20 ready to proceed on this question and believe that the 21 papers that they have filed and the evidence that they have 22 submitted previously will show that the San Joaquin River 23 Agreement does provide a level of protection equivalent to 24 the Vernalis flow objectives. 25 We would suggest that the hearing, if Phase II is to 0680 01 start tomorrow, would proceed forward on the question of 02 level of equivalency. Each witness, of course, would have 03 cross-examination and redirect, and every party to the 04 proceeding would be allowed to present rebuttal testimony on 05 the question of equivalency. 06 If after hearing all the testimony, the State Water 07 Resources Control Board would then make a decision as to 08 whether or not the San Joaquin River Agreement provides 09 equivalent protection. This is not a finding -- this is not 10 an order. It would be a finding by the Board that there is 11 equivalent protection afforded by the San Joaquin River 12 Agreement. Then what we would envision is that at some time 13 after the Board has had a process to deliberate after -- I 14 think we could have our case done by the end of July, the 15 Board would deliberate for a period of time, and then would 16 issue a finding, finding whether or not there is equivalent 17 protection. 18 If the Board found there was equivalent protection, 19 then we would propose going to what we call Phase II-A. If 20 the Board does not find equivalent protection, then the San 21 Joaquin River Agreement cannot be implemented as it is 22 presently configured, and we would have to do one of two 23 things: 24 A, go back and renegotiate the agreement to a level 25 that does provide equivalent protection; or, B, not 0681 01 negotiate and proceed to Phase VIII, contested adversarial 02 hearing between all the parties to the hearing and all the 03 parties to the proceeding. 04 If the Board issued a finding in mid-August and set a 05 hearing schedule for Phase II-A, this is how we would 06 envision Phase II-A. I am going to read this. I spent some 07 time to draft this over the last week. I hope I have it 08 right. This is what we tried to agree on consensuswise with 09 other parties to this proceeding. If I don't get it right, 10 I am sure the other parties to the proceeding will let me 11 know and tell you so. 12 C.O. CAFFREY: They haven't been shy. 13 MR. O'LAUGHLIN: I don't think so. 14 Phase II-A would include every alternative, every party 15 to the San Joaquin River Agreement's responsibility for the 16 flow objectives of the 1995 Water Quality Control Plan on 17 the San Joaquin River and every other party to this 18 proceeding's evidence, argument as to what is the preferred 19 method for implementing the 1995 Water Quality Control Plan 20 on the San Joaquin River portion given these alternatives. 21 So, we would envision a hearing in which all parties 22 would be present, present all evidence as to why the San 23 Joaquin River Agreement is or isn't the preferred method of 24 alternative or put other Alternatives up as to why they 25 should be implemented, vis-a-vis the San Joaquin River 0682 01 Agreement. 02 We believe this process will allow all parties to 03 thoroughly examine the San Joaquin River Agreement. It will 04 allow all parties to discuss other alternatives, and it will 05 fully expose to the Board the pluses and minuses of the 06 other alternatives that have been presented. 07 Our goal after that time period would be, after II-A is 08 done, is for the Board to then issue an order. We, and we 09 put this in our papers, would envision an order in which, 10 hopefully, the Board would adopt the San Joaquin River 11 Agreement as the preferred method to implement the 1995 12 Water Quality Control Plan on the San Joaquin River 13 portion. 14 You will notice in the papers that have been filed 15 there is much discussion regarding orders and how we get to 16 orders. What we are going to propose now is -- I do not 17 want to withdraw my motion in regards to requesting a final 18 order from the Board after II-A. We clearly understand the 19 need by us and other parties to work out a process to get 20 from phasing to orders, orders that are not only 21 implementable, but can withstand judicial scrutiny. 22 What we are going to request today is that we believe a 23 workshop, or further briefing on this question of orders, is 24 warranted. As you remember, back on April 21st of this year 25 in regards to this discussion and the San Joaquin River 0683 01 Agreement, I am sorry he's not here today, but I understand 02 he is probably having more fun in Scotland than we are here. 03 But Mr. Del Piero had an interest in this question about how 04 we get from phasing, implement CEQA and get a final order. 05 We, in response to those questions of April 21st, the 06 San Joaquin River Group Authority, filed a briefing paper 07 with the Board in regards to that question and served it on 08 all the other parties. We believe, however, given that 09 briefing paper and the discussions that have occurred over 10 the last three or four weeks, that it is clearly in all of 11 our interest to sit down and figure out the process by which 12 we go from phasing to orders in this case. 13 So, we would request that a workshop or further 14 briefing on the questions of orders is warranted. 15 One of the other things I wanted to bring up briefly is 16 the question that has been raised several times in the 17 proceedings about adversarial testimony and the rights and 18 responsibilities of the San Joaquin River Agreement parties 19 to present testimony. Originally, when the hearing notice 20 was sent out, it allowed the parties to the agreement not to 21 present adversarial testimony. There were questions raised 22 by Stockton East Water District in regards to the scope and 23 extent of not presenting adversarial testimony, and those 24 were responded to by the Board in its June 11th, 1998 25 letter. In addition, the Board requested that if we were 0684 01 not going to present adversarial testimony, that we submit a 02 letter to the Board telling the Board that we would not be 03 doing so. We have done that. 04 I think it is very important to stress again, as we 05 move forward in this process, that we need to have the 06 ability to have these settlement agreements heard first, 07 have decisions made on the settlement agreements, whether in 08 the affirmative or negative, prior to the proponents of the 09 settlement agreements presenting adversarial testimony, 10 vis-a-vis each other. Specifically, I want to bring this up 11 in regards to Phase V and Phase II-A. 12 We are very concerned that parties to the agreement not 13 be put in a position of presenting adversarial testimony in 14 Phase V, that they could reserve their rights to present 15 adversarial testimony if and when the San Joaquin River 16 Agreement is not accepted by the Board and we go to a Phase 17 VIII contested hearing. 18 The problem is, if we have to present adversarial 19 testimony, vis-a-vis parties in Phase V, there are several 20 members to the San Joaquin River Agreement, very large 21 numbers on the San Joaquin River Agreement, who would be put 22 in extremely awkward positions. And what the problem would 23 be is that if we presented that evidence, it would probably 24 unravel the San Joaquin River Agreement. That would be 25 unfortunate, given that agreement has not had a chance to go 0685 01 forward and be heard. 02 So we would request, once again, that the Board 03 reaffirm that parties to the San Joaquin River Agreement do 04 not have to present adversarial testimony in these phases, 05 can reserve the right to present adversarial testimony if 06 and when the San Joaquin River Agreement is not accepted and 07 present that testimony in Phase VIII. 08 The procedure that we see going forward, and I sat down 09 and tried to figure out a method and a schedule of going 10 forward and trying to move the process along and realizing 11 that the CEQA process is running on a parallel track to the 12 hearing process, what we would envision is -- it's a 13 recommendation, it's a thought to explore with the Board how 14 this process could go forward. 15 We would envision that the San Joaquin River Agreement 16 Phase II could be completed by the end of July. We would 17 then see that Phase III would commence beginning in early 18 August. Hopefully, the Board would be able to render a 19 decision on equivalency sometime in the middle of August and 20 issue a hearing notice for submittal of testimony on or 21 about the middle of testimony for Phase II-A. Hopefully, 22 then Phases III and IV can be completed in August. We would 23 envision that Phase V would take place in September. Phase 24 II-A taking place shortly thereafter, in late September or 25 early October, and then concluding with Phases VI and VII. 0686 01 Hopefully, by that time, the State Water Resources 02 Control Board and its staff is in a position, in regards to 03 its Draft EIR and supplemental Draft EIR, to be in a 04 position to finalize the EIR and to certify an EIR, and then 05 move forward with issuing proper orders before we go to a 06 contested portion of the hearing in Phase VIII. 07 We do believe and agree with Mr. Thomas that if the San 08 Joaquin River Agreement is not adopted that there be 09 adequate time to prepare for an adversarial hearing between 10 the parties in Phase VIII. We recommended 60 days. I have 11 nothing further to say on the motion. 12 In regards to the phasing, if there are any questions 13 by the Board or by staff, I would be willing to entertain 14 those. 15 C.O. CAFFREY: Thank you very much, Mr. O'Laughlin. 16 I think what we will do, seeing that Senator Costa has 17 arrived, is ask you to yield the podium. 18 MR. O'LAUGHLIN: Definitely yield the podium. 19 C.O. CAFFREY: Then we will see if the Board Members 20 have questions. 21 Good morning, Senator Costa. Thank you very much for 22 taking the time to join us to make a policy statement. We 23 appreciate it, sir. 24 SENATOR COSTA: Thank you very much, Mr. Chairman, 25 Members of the Board. It is always a pleasure for me to 0687 01 have an opportunity to testify before you and to share 02 efforts as we try to solve, together, our state's long-term 03 water issues. 04 I believe it is an exciting time, frankly, to be 05 involved in the debate on how we address policy questions 06 that have for many, many decades been a source of contention 07 among various regions of California as it relates to our 08 water supply, our water quality, our environmental 09 ecorestoration, as well as our flood control needs. 10 I believe the last three years have marked a turning 11 point in which we have been able, through a series of 12 efforts make significant progress that has allowed us to, I 13 think for many of the parties, provide a source that, in 14 fact, a source of feeling that there is a solution to many 15 of these issues, quite simply stated, and I think we have 16 developed a process through CAL/FED that is allowing all the 17 stakeholders to be at the table, to provide their input and 18 voice their concerns as we develop solutions that can be, on 19 an incremental basis, developed as we solve every region's 20 water needs. I think that is exciting. 21 I think that provides great potential for all of us. I 22 guess some people, because of the debate we have with the 23 water bond and some of the other issues we are dealing with 24 currently, think that, gee, CAL/FED's got real problems and 25 got problems with State Water Control Board and a host of 0688 01 other issues we are trying to figure out. I guess it's the 02 difference between an optimist and a pessimist. I think the 03 glass is half full and not half empty. 04 For all of us who have committed our careers to dealing 05 with resource issues and particularly the state's water 06 needs, and we all, I think, understand that water is the 07 life blood of California, this is really the time to come 08 together because we have an opportunity to solve some 09 problems. In that line, I would like to make some comments 10 this morning. While I know it is not the singular focus of 11 this morning's hearing, but is an issue that is before the 12 Water Quality Control Board and one that, through the series 13 of agreements that have been reached in recent months after 14 painstaking efforts of almost three years now, that the 15 State Water Quality Control Board will be considering later 16 this year, I would like to provide my testimony because I 17 believe it is timely. 18 I believe this process, the VAMP process here, that is 19 being, I think, worked out, provides a model for other 20 efforts on other systems in the state, and I think the plan 21 that has been developed as a result of the 1995 Water 22 Quality Control Plan is one that deserves careful 23 consideration. The San Joaquin River Agreement, I think, is 24 laudable for two reasons. 25 First, this process utilized to create the agreement 0689 01 emphasizes the problem solving, as I was making reference 02 earlier. The process includes not just the stakeholders, 03 which I think have rights to water, but also the 04 environmental groups who have long been concerned about the 05 impacts on the ecosystem. This type of, I think, voluntary 06 inclusion of and cooperation by such diverse interests is 07 exactly what the state needs if we are going to solve the 08 issues of not just water quality and ecorestoration, but 09 water supply, which is absolutely critical if we are going 10 to move into the 21st Century and provide the sort of 11 assurances necessary to maintain our regional economies. 12 All the participants in this process should be 13 commended for their efforts. More important than the 14 process, however, I think, is the result which has been 15 obtained. To begin with, the agreement provides for fishery 16 protection which is needed now. No one denies actions must 17 be taken to ensure that the continued existence of wild, 18 naturally producing salmon in the San Joaquin River 19 tributaries and the water made available during the April 20 and May pulse periods is perhaps the cornerstone that I 21 think needs to be continued if, in fact, we are going to try 22 to successfully provide restoration of salmon in the 23 tributaries of the San Joaquin River. 24 Moreover, the agreement provides for an opportunity to 25 examine, using accepted scientific methods over an extended 0690 01 period of time. The relationship of the flow in Vernalis, 02 the exporting of pumping and the use of river barriers to 03 suck the outmigrating salmon smolts are all very important. 04 The data that is being gathered during the term of the 05 agreement, I think, will avoid the situation that we are all 06 too familiar with, in which the problem is recognized, but 07 the solution is debated due to lack of scientific support. 08 I think, frankly, Members of the Board here, let's not 09 kid ourselves. The issue of the survival of salmon and 10 other fishery resources in the San Joaquin River has come 11 before and it will come up certainly in the future. The 12 next time as a result of data that is gathered through this 13 agreement. I think information will be made available to 14 develop a solution which cannot be assailed on the basis of 15 science, which has been, too often, the past problems that 16 we have seen. 17 I am not saying that the agreement that I think is 18 being proposed is a panacea for all the problems facing the 19 Bay-Delta system, which this water right hearing is designed 20 to resolve. You have a very, very, very difficult task 21 before you. I don't have to tell you that. It is, however, 22 though, I think procedurely and substantively an example, as 23 I said earlier, of what can be achieved, what can be 24 achieved when interested parties work together. 25 I think it will result in continuing existence of the 0691 01 potential to improve salmon restoration in the tributaries 02 of the San Joaquin River, both now and in the future. I 03 think the agreement deserves support, and I hope that the 04 Board adopts and implements its provisions as soon as 05 possible. As I said, this doesn't pitch to solve all the 06 problems out there. But we have made significant progress 07 among all the parties that have been at the table for the 08 last three years. It is for those reasons that I would 09 suggest that we attempt to adopt and formalize this 10 agreement and move on from there. 11 As I said, it is an exciting time. There are a lot of, 12 I think, positive efforts that are going on. We need to 13 encourage those positive efforts that are ongoing. As 14 people that have had differences historically, sit together 15 at the table and try to find solutions in common that they 16 can both support. And it is our job as policy makers, I 17 believe, to make sure that the process works and that we 18 keep everyone moving in the proper directions. 19 So, I want to thank you again for allowing me to be a 20 part of your work and commend you on your efforts and wish 21 you well. 22 C.O. CAFFREY: We wish to thank you very much, Senator, 23 for taking the time from your busy schedule to be here. We 24 like to think that we share your optimism about California's 25 water future. Even though we here on the Board are faced 0692 01 with solving these problems within a hearing record and 02 rules of evidence, we are very moved by the efforts that are 03 going on among a number of negotiating parties to come to 04 these agreements and present them to us in this process. 05 We thank you again for being here and your continuing 06 leadership in many of these very important water issues for 07 the State of California. Thank you, sir. 08 SENATOR COSTA: Thank you. Any questions, I'll see you 09 down the road. 10 C.O. CAFFREY: Any questions of Senator Costa? 11 C.O. STUBCHAER: How's your commute from Fresno? 12 SENATOR COSTA: It's probably as difficult as yours. 13 The airline service has been eliminated -- I don't know that 14 this is important for the record, but -- 15 C.O. CAFFREY: Policy statements allowed for a broad 16 spectrum. 17 SENATOR COSTA: I am not so sure what it has to do with 18 water. We are trying, endeavoring to encourage airlines to 19 renew service not only between Fresno and Sacramento, but 20 Bakersfield and Santa Barbara. It's been difficult for many 21 of us who do that weekly commute. And Board Member Forster, 22 if she's ever in doubt about issues that involve water, she 23 always is willing to make sure that she corners me at the 24 workout in the morning at the gym. I assume that she has no 25 questions that she hasn't already asked me this week. 0693 01 C.O. CAFFREY: Anything else? 02 C.O. STUBCHAER: That's enough. 03 C.O. CAFFREY: Thank you very much, Senator Costa; 04 appreciate it. 05 Are there any other members of the Legislature that 06 have joined us and wish to make statements? 07 Any staff representing members of the Legislature? 08 Thank you. 09 We will go back, then, to consideration of and 10 presentation of the arguments. 11 Did any of the Board Members or staff wish to ask any 12 clarifying questions of Mr. O'Laughlin? He had just 13 completed his motion or his argument on his motion. 14 Ms. Leidigh. 15 MS. LEIDIGH: Thank you, I do have a question. My 16 question is, because I think there has been a little bit of 17 confusion, who specifically are you advocating would have 18 the ability to withhold adversarial testimony? Does it 19 include only the signers of the San Joaquin River Agreement? 20 MR. O'LAUGHLIN: That is correct. 21 MS. LEIDIGH: So other people who may be cooperating in 22 some other fashion, but have not signed, would not be 23 included in that request? 24 MR. O'LAUGHLIN: Thank you, Mr. Birmingham. 25 The agreement has not been signed yet, as you know. 0694 01 MS. LEIDIGH: I know, but your Letter of Intent -- 02 MR. O'LAUGHLIN: The letter of support for the 03 agreement is the parties who have signed. I thought the 04 State Board's response in regards to Jeanne Zolezzi's letter 05 from Stockton East Water District was correct, in that, 06 parties who have signed the letter of support to the 07 agreement are the parties who do not have to present 08 adversarial testimony. 09 MS. LEIDIGH: Thank you. 10 MR. SEXTON: Mr. Chairman, may I make a clarifying 11 statement on that? 12 For example, this is my friend Mr. Birmingham. Mr. 13 Birmingham represents the Westlands Water District. I 14 represent the Exchange Contractors. We don't agree on many 15 things much of the time. 16 MR. BIRMINGHAM: Most of the time. 17 MR. SEXTON: Westlands will be a party to the San 18 Joaquin River Agreement, as will the San Luis Delta-Mendota 19 Water Authority, which is made up of several westside CVP 20 agricultural interests. We would envision that no 21 adversarial testimony would be put on as between, for 22 example, Westlands and Exchange Contractors, nor would 23 adversarial testimony be put on by other members of the San 24 Luis-Delta Mendota Water Authority regarding San Joaquin 25 salinity. 0695 01 So, it is a little broader than just the signatories to 02 the agreement. It is also the member agencies of the 03 signatories, although they haven't been directly involved in 04 the negotiations. So, for example, in Phase V what I would 05 envision is that if other parties wish to take shots, for 06 example, at westside agricultural interests regarding San 07 Joaquin River salinity, the recipients of those shots would 08 very cavalierly smile and sit back and essentially do very 09 little and not try to put on adversarial testimony. They 10 may put on some rebuttal testimony, but it would be limited. 11 Only if we got into a Phase VIII proceeding would, I 12 guess, the gloves come off and we all do what is in the best 13 interests of our clients at that point. 14 C.O. CAFFREY: Thank you, Mr. Sexton. 15 Mr. Candee, are you asking a clarifying question? 16 MR. CANDEE: I want to follow up on that point. I 17 think it is relevant to Ms. Leidigh's question. 18 I am Hamilton Candee with Natural Resources Defense 19 Counsel. We are not a party to the San Joaquin River 20 Agreement and have not signed a statement of support, but we 21 do appreciate the efforts that Mr. O'Laughlin has made to 22 try to accommodate some of the concerns of the nonsigning 23 parties. 24 It is my understanding that all of the parties would be 25 able to participate in this new Phase II-A. It is true that 0696 01 the SRGA folks would withhold some of the adversarial 02 testimony. But if the Board were to have a Phase VIII 03 adversarial process, the NHI memo is very clear that 04 everybody then would be able to come in. Because at that 05 point, all bets are off, and there is a full Phase VIII 06 adversarial process. That is not to say where we are at on 07 the final order question or the interim order question, I 08 think Tim is quite correct, it makes sense to have a 09 workshop and briefing on that point, because they're very 10 important questions about NEPA and CEQA that, to a certain 11 extent, depend on timing, which I don't think anyone is 12 prepared. At least in terms of the discussions we've had, 13 there is no consensus as to whether the Board could issue an 14 interim order that is legally defensible and sort of depends 15 on a lot of other factors. 16 It seems to me for purposes of moving things along, I 17 think this division between Phase II and Phase II-A makes a 18 lot of sense. It gives parties like NRDC, for example, the 19 opportunity to match up the different alternatives as 20 against the San Joaquin River Agreement. 21 Nevertheless, I think what Ms. Leidigh's question goes 22 to what happens if Westlands and the Exchange Contractors, 23 for example, withhold evidence in Phase V of the San Joaquin 24 River Group parties withhold evidence against each other in 25 Phase II-A as comparing, say, Alternative 5 to the San 0697 01 Joaquin River Agreement and then, for whatever reason, we 02 find ourselves in a Phase VIII adversarial process, they 03 want to be reassured that they can then go forward with that 04 adversarial evidence, that they haven't waived that 05 right. And I understand the question, and I just want to 06 clarify that our understanding is, at that point, everybody 07 is able to participate in that hearing. They may, in fact, 08 have already put in all their evidence, and they would 09 simply be just cross-referencing it. Probably a lot of 10 parties will feel that II-A is their best shot. But they 11 are at least going to be fully able to participate just like 12 the other folks. I know Tim hopes we never get to Phase 13 VIII. I just want to clarify that. 14 C.O. CAFFREY: I hope it is not an expression or bias 15 to state that it would be nice for all of us to hope that we 16 never have to get to a Phase VIII. If we do, we do. 17 You go ahead. 18 MR. O'LAUGHLIN: Real quickly on Mr. Candee's comments. 19 Clearly, if we get to Phase VIII, no one's testimony would 20 be foreclosed. All parties would participate. All 21 adversarial testimony would come in. I just wanted to try 22 to preserve that principle that the settlement agreements 23 get a chance to succeed before they fail. 24 C.O. CAFFREY: Thank you for that clarification, both 25 from Mr. Candee and you, Mr. O'Laughlin. I do think that we 0698 01 did understand you to be saying that. Let me ask a 02 question: 03 We are interested here in providing due process, 04 obviously, but moving it at all dispatch while providing due 05 process. You spoke of the possible need for a workshop. 06 When would you see -- what is the timing of that? When 07 would you see that occurring? Would you see that occurring 08 prior to any further movement along the path of Phase II or 09 running simultaneous with it as a general, how to create a 10 bridge from phasing to deciding? 11 MR. O'LAUGHLIN: We talked about this over the last 12 several weeks. We see it running concurrently. In other 13 words, we believe you can start Phase II tomorrow, if you 14 get done today with what you need to get done. Then we can 15 move forward with II, III, IV. Then, at some time if your 16 staff feels -- I don't know if they want to send out a 17 briefing paper first and say, "Here's our idea" and schedule 18 a workshop," or if the Board wants to send out a notice and 19 schedule a workshop, we see a workshop, a one-day workshop, 20 maybe some time in September. 21 C.O. CAFFREY: The workshop would be -- excuse me for 22 thinking out loud, it's kind of partially repeating what you 23 said. You would see us getting to some point of, perhaps, 24 evolution and learning as we went where we put out some kind 25 of proposal on how to get to that decision process with all 0699 01 due consideration to CEQA and everything else, and then 02 present that as a paper, and then, so we can all get to one 03 room and make sure we are all on the same page, either 04 agreeing or agreeing to disagree, in a one-day workshop so 05 that there is understanding? 06 MR. O'LAUGHLIN: So that all parties would be -- there 07 is a wide range, as you saw on the papers, of visions of how 08 this could be done. I think it would be helpful if we could 09 explore those a little further. Also, I think, and not to 10 say that delay is good in regards to the workshop, but I 11 think it would be much more helpful to understand how far 12 along we are in the CEQA process, as well. The timing of 13 the CEQA process, as other people have mentioned, timing -- 14 not only is the process important, but the timing is also 15 important, how these things are going to dovetail into your 16 hearing schedule, your need to try to get the hearings done, 17 get CEQA done before we move forward on other issues. 18 I would agree with you, Chairman Caffrey, on that. 19 C.O. CAFFREY: Any other questions from the staff? 20 Ms. Leidigh. 21 MS. LEIDIGH: I have another question I thought about. 22 A number of parties in their briefing papers pointed out a 23 relationship between Phase V and Phase II. 24 MR. O'LAUGHLIN: We don't disagree with that. 25 MS. LEIDIGH: After having read that, I was just 0700 01 wondering what your position would be if the Board 02 considered combining Phase II-A and Phase V. 03 MR. O'LAUGHLIN: That is an interesting point. In 04 fact, we had that discussion this week, as well. 05 C.O. CAFFREY: I imagine there is very little you 06 didn't discuss. When we get done with this process we will 07 have a manual about that thick that will be a very useful 08 document. 09 MR. O'LAUGHLIN: We have discussed that extensively. 10 Our position is that we would like to keep Phase V separate 11 from Phase II-A. We think it is an ideal lead-in to Phase 12 II-A. That is why we have asked to schedule III, IV, V and 13 then II-A. There are issues in regard to Phase V that 14 really aren't probably applicable, in our minds, to the San 15 Joaquin River Agreement, the interior Delta barriers being 16 one of them. 17 So, we would like to keep that separate and distinct. 18 There clearly is an overlap between the San Joaquin River 19 Agreement, water quality flows at Vernalis and salinity. We 20 understand how those dovetail in relationship to how the 21 agreement will work through operations of the reservoirs, 22 the operation of New Melones. We think if we can kind of 23 keep them separate and distinct, to the best of our 24 abilities, we should try to do so. 25 Whereas, Phase II-A would be more of a focus on the 0701 01 other alternatives, vis-a-vis the San Joaquin River 02 Agreement or the other alternatives in and of themselves, 03 where V would be separate and distinct in regards to the 04 South Delta salinity issues, more particularly. 05 C.O. CAFFREY: Go ahead. 06 MS. LEIDIGH: Further follow-up questions. 07 Do you think that the Board should put out a notice in 08 the fairly near future setting a date for submission of 09 Phase V testimony? 10 MR. O'LAUGHLIN: Yes, we do. 11 MS. LEIDIGH: Thanks. That is all. 12 C.O. CAFFREY: Anything else from the dais, Board 13 Members or Mr. Pettit or Mr. Attwater? 14 Ms. Forster has a question. 15 MEMBER FORSTER: You were reading off of your yellow 16 legal pad. Are you going to put this all in writing for us 17 and send it out to all the parties, what you propose today, 18 so people can review it? 19 MR. O'LAUGHLIN: Yes. Most of what we have proposed is 20 in follow-up briefing paper of July 9th, 1998. We did 21 become a little bit more specific in regards to the 22 language, in regards to the scope and extent of the Phase 23 II-A. And at your request, we will send out an errata to 24 our briefing paper to all the parties. 25 I probably can't do that today. I can probably get to 0702 01 it by tomorrow, to all the parties, informing them of what 02 our vision is of the II-A process. My problem is that I 03 can't -- 04 Cliff was just reminding me that you're going to have 05 your decision made today. My problem is that I can't get a 06 hundred mailings out by 5:00 this afternoon. There is a 07 physical limitation. I can try to get it out, put it on 08 the E-mail and fax it. But I don't believe that I will be 09 in a position to get an actual proof of service done and out 10 by 5:00 today. 11 MEMBER FORSTER: I don't think that was my intention. 12 My intention was just to circulate it to all the parties. 13 MR. O'LAUGHLIN: In fact, what I am going to do, I just 14 looked at my associate, and I am going to send him over to 15 Mr. O'Brien's office, and he will type it up and hopefully 16 have a hundred copies on the back of the dais, back of the 17 room within the hour. 18 C.O. CAFFREY: I agree it would be helpful to have 19 that, especially if our notes weren't that good up here. Of 20 course, we have a very good record from our Court Reporter, 21 but it is good to have that information. I would also say 22 that we will try very hard to get a ruling out today. If we 23 are not successful, we will let you all know, and it will 24 certainly be out by tomorrow. I want to get it right. I 25 will also say that we will try to be clear in our reasoning. 0703 01 As we put this ruling in writing, it won't just be a 02 decision; we will also try to give the reasoning and 03 reference your points, as well, to the extent that they are 04 pertinent. 05 Mr. Pettit had a question. 06 MR. PETTIT: It may be irrelevant, Mr. Chairman, in 07 view of your comments you just made. My question went to 08 the relationship between the ruling which you hope to make 09 later today and this document that would be circulated. 10 Because my initial reaction was that if you put out a ruling 11 today and it is basically satisfactory to people, then I am 12 not sure what the further document accomplishes. 13 On the other hand, if you don't put out a ruling, well 14 then, possibly some clarification and expansion of the 15 details would help. I am just not sure what purpose the 16 further document will serve if you get a ruling out today. 17 MR. O'LAUGHLIN: You know, I would tend to agree with 18 Mr. Pettit on that point. In that, if the Board agrees on 19 the general concept of going from II to II-A and agreeing 20 that Phase II, the one that is coming up, hopefully on 21 Thursday, would be a question of equivalency, I think 22 drafting the notice for the hearing in regards to Phase 23 II-A, we could provide language to you and to all the other 24 parties, but that notice may not come out for another 30 25 days. So we can get that done and serve that on all the 0704 01 parties. 02 Now, of course, II-A may not happen ever because you 03 may find that it is not equivalent. So, we can provide that 04 to all the other parties. 05 The other thing I would request in regards to Phase V, 06 you asked if we would like to see the submittal of Phase V 07 go out. We would. As you would probably imagine. Since we 08 are right in the middle of our presentation of our case in 09 regards to the San Joaquin River Agreement on the 10 equivalency factor, we would request that that not go out 11 until at least the first week in August. That would give 12 the parties 30 days to submit their testimony. 13 Thank you, Mr. Chairman and Board Members. 14 C.O. CAFFREY: Any other questions? 15 Thank you, Mr. O'Laughlin. 16 Mr. Robbins, did you have something -- 17 MR. ROBBINS: Just very briefly. 18 C.O. CAFFREY: -- pertinent to this and different from 19 any argument you way wish to offer? 20 MR. ROBBINS: Yes, just very briefly. 21 I think it is wise to put that on the record, and one 22 of the things I am attempting to do is watch the record. 23 It's occurred to me that while we -- I think we all know why 24 the San Joaquin River Group has requested the opportunity 25 not to have to put on adversarial testimony. For the record 0705 01 purposes, future people looking at this might want to know. 02 Very concisely, the reason is because the agreement 03 that has been proffered to you is not based on fault or upon 04 water rights. If it were, obviously, something looking like 05 your Phase VIII would have to be what we were involved in. 06 We have tried to avoid that. 07 Therefore, in order to proffer to you an agreement that 08 is based neither on water rights or fault, we had to each 09 agree that the complaints we have with respect to each 10 other, let alone with the rest of the world, will have to be 11 subservient to the agreement. And for the record, that is 12 the purpose for asking for that opportunity. 13 C.O. CAFFREY: Thank you, sir. 14 Mr. Jackson. Good morning, sir. 15 MR. JACKSON: Good morning. So that I understand, the 16 Phase II-A appeared today as a new phase. As I understand 17 II-A -- 18 C.O. CAFFREY: It's a proposal. 19 MR. JACKSON: It's a proposal, right. I just wanted to 20 make it clear that this is the first that I have heard of 21 proposal as we stand here today. 22 The question is: Why is Phase II-A being proposed? 23 What it sounds like is a Phase VIII hearing for anyone who 24 didn't sign the agreement with a reserved right of those who 25 did sign the agreement to have a Phase VIII hearing 0706 01 later. And it puts those who signed the agreement in a 02 completely different legal position than those who didn't 03 in terms of the burden on them in the Phase II-A 04 hearing, and I believe violates fundamental rights of the 05 people who didn't sign the agreement. 06 C.O. CAFFREY: Mr. Jackson, point of clarification on 07 my part. I think you're making an argument rather than 08 asking for a point of clarification. And rather than try 09 and answer it today, maybe this should be a part of your -- 10 MR. JACKSON: Here is my question: Can I reserve my 11 ability to challenge the agreement as an alternative in the 12 plan in a comparison with Alternative 5 and Alternative 2, 13 which is what we support? Can I reserve that, or do I have 14 to try the whole comparison of alternatives prior to the 15 CEQA document being approved? 16 C.O. CAFFREY: Let me ask -- since you are putting that 17 on the record as a question, which we could deal with in our 18 motion and consider it as a question within our argument, I 19 wonder if Mr. O'Laughlin would wish to venture an answer. 20 You don't have to, sir. 21 Mr. Birmingham. 22 MR. O'LAUGHLIN: Mr. Birmingham wants to get this one. 23 MR. BIRMINGHAM: I will attempt to venture an answer. 24 Mr. Jackson has just said that he is going to be put to the 25 burden of having to try -- 0707 01 C.O. CAFFREY: I am sorry, Mr. Birmingham, start again. 02 MR. BIRMINGHAM: Mr. Jackson has just stated that he is 03 going to be put to the burden of having to try his case with 04 respect to each one of the alternatives before the CEQA 05 document is approved. That is going to be the situation 06 regardless of the procedure that is followed by the Board in 07 terms of phasing. Typically, this Board doesn't certify an 08 environmental document until shortly before it adopts an 09 order. Sometimes it is done on the same day. 10 In this circumstance the environmental document, 11 certainly, isn't going to be approved before we get to Phase 12 II-A or Phase VIII. In fact, Mr. O'Laughlin did serve last 13 week a revised proposal in which he articulated a Phase 14 II-A, or identified a Phase II-A. 15 And from the perspective of the parties who have signed 16 the agreement, we are at a disadvantage in Phase II-A 17 because we are not going to be submitting our adversarial 18 evidence, and we will be at a disadvantage in Phase V 19 because we will not be submitting our adversarial evidence. 20 Mr. Jackson will have every opportunity to advocate 21 different alternatives in Phase II-A and, ultimately, if the 22 Board rejects the San Joaquin River Agreement, he will have 23 the opportunity to do the same thing in Phase VIII. So, he 24 is the party that has the advantage in terms of having 25 essentially two bites at the apple. 0708 01 C.O. CAFFREY: Before we go any further with this, I 02 appreciate your comment, I am going to cut this off right 03 here because what I've done, really, is I've kind of taken 04 Mr. Jackson out of order. What we really need to do is, and 05 this is kind of an outcropping of a questioning period just 06 for clarification, and many of you came up to help Mr. 07 O'Laughlin, what I think what we will do now is cut off what 08 is starting to be a debate and move to the opportunity for 09 presentation of argument, and then the Board will take it 10 all under submission for production of our ruling. 11 With that, then, let me ask if there are -- and, Mr. 12 Jackson, certainly you can continue making your argument. I 13 am not cutting you off. 14 MR. JACKSON: I understand. 15 C.O. CAFFREY: We will start with you, if you wish. 16 Let me ask if there are any other parties besides Mr. 17 Jackson that wish to respond, make arguments, statements. 18 All right, we'll start. Before you come up here, Mr. 19 Jackson, I'll ask Mr. Stubchaer to make a list. 20 We have Mr. Nomellini, Mr. Herrick, Mr. Maddow, Mr. 21 Suyeyasu, Mr. Lily, Mr. Candee, Ms. Cahill, Mr. Porgens, Mr. 22 Schulz. 23 Did we get everybody? 24 All right. Looks like we did. We'll start with Mr. 25 Jackson, and be mindful there is a half-hour limit to the 0709 01 presentation of any argument. We don't want anybody to feel 02 compelled that they must take the entire half hour. 03 MR. JACKSON: The first thing that I believe is 04 important, Mr. Chairman, is how you are going to deal with 05 the CEQA document in the hearing. The CEQA document is not 06 only a CEQA document, as you laid it out, but it says on its 07 face repeatedly that the CEQA document is to serve as the 08 State Board's evidence in this particular hearing. 09 Your evidence is not going to be available if you go 10 forward on a comparison of the alternatives in a section 11 II-A. It is not going to be certified, and, clearly, it is 12 in the process of having had responses to it once with no 13 comments back to us in regard to those responses in which it 14 is not finished at this point. 15 You just closed a second circulation period on the 16 revised chapters dealing with the VAMP, and I believe that 17 period closed yesterday or Monday, and the responses to 18 comments are not present in that at this point. 19 So, to go forward with any form of comparison of 20 alternatives leaves us using as evidence a document that the 21 State Board isn't finished with. That is point number one. 22 Point number two, if, in fact, one set of parties, the 23 parties who signed it, can hold back their adversary 24 information, can hold back their testimony, are we going to 25 reopen for those of us who go forward when they do that? 0710 01 Because, clearly, we would have a right to rebuttal on their 02 evidence if it does ever come forward. And if it doesn't 03 come forward, the evidence that is in the record will be 04 there without them taking part in the hearing. And I sort 05 of foresee a situation in which the result is subject then 06 to them coming back and saying, "No, we've decided we need 07 to put in this evidence." They've reserved the right to do 08 it, and we are back in the hearing again with a bifurcated 09 two-part hearing. 10 The third problem with dealing with the San Joaquin 11 River, independent of the rest of the San Francisco 12 Bay-Delta, in this hearing is that flows are going to be 13 determined without evidence, I presume, on the Sacramento 14 side. In doing that, I think you come up with, perhaps, a 15 completely different result than if you were looking at both 16 the San Joaquin and Sacramento River in one phase of this 17 hearing. 18 So, I do understand -- I like the phasing of II and V 19 together. It would seem what we really ought to do is bring 20 forward III and IV and then delay II and V until you can get 21 the CEQA document at least in a shape that you want it to 22 be. Those two phases fit together better. It's going to be 23 the same kind of evidence, and it all comes in at about the 24 same time. 25 So, my suggestion would be that you reverse your role, 0711 01 do II and IV and hold II and II-A until phase and then do 02 both of them on the San Joaquin River at the same time. 03 Thank you very much. 04 C.O. CAFFREY: Thank you very much, Mr. Jackson. Mr. 05 Nomellini. Good morning, sir. 06 MR. NOMELLINI: For the record, Dante John Nomellini on 07 behalf of the Central Delta parties. First of all, this 08 motion is somewhat of a moving target, although I think we 09 can get to the merits of it. The paperwork changed a little 10 bit in the briefing, rather than the motion document. 11 I have no objection to a Phase II going forward 12 tomorrow on the limited basis that Mr. O'Laughlin has 13 suggested. I think, though, that, as I stated before, you 14 cannot enter interim decisions without the total record 15 before you. I've complained about that before, and I am 16 complaining again about the suggestion that you can issue a 17 final order approving a San Joaquin River Agreement. 18 The San Joaquin River Agreement is much more than 19 VAMP. VAMP is a variable test for the flows for fish which 20 our agency has supported. It makes sense to try to learn 21 more about what the cause and effect relationship is for 22 fish. The San Joaquin River Agreement, though, seeks to 23 settle entirely the water right commitments with regard to 24 the Water Quality Control Plan, and tucked in there is 25 Friant and the implications of what that has for the later 0712 01 Phase V, salinity of the San Joaquin River. You have other 02 things associated with the total picture that are going to 03 be confused, at the very least, with the approval of that 04 agreement. 05 Now, I think the idea of a later Phase II-A is fine, 06 but I don't see how you separate it from a Phase V or Phase 07 VIII. And I don't see how you separate one group of people 08 presenting their adversarial testimony on water rights and 09 another group doing it at a different time. I think all of 10 the water rights struggling, the real water rights 11 struggling, gets shoved later, and that this Board's phasing 12 could serve the purpose to focus the differences among all 13 of us with regards to the settlement agreement approach. 14 And my view of your whole process is that, and I 15 listened carefully when the water contractors made their 16 pitch at our scoping meeting. They said they wanted the 17 Board to move forward with these hearings while they 18 continued to do these negotiations. In my view, that is to 19 keep the leverage of the Board and everybody so that we get 20 as many agreements put together as possible. Hopefully, it 21 will resolve the problem, and the state and the Bureau will 22 come up and say, "Aha, for the test period of 12 years, or 23 whatever it is, we are going to take care of the problem," 24 and, incidentally, I put in my papers, and I intend to prove 25 to you, that it is all their responsibility anyway. 0713 01 Let's put that aside for the moment. I think we come 02 forward and say, "We are going to meet this. We are going 03 to have a contribution from the San Joaquin River Group of 04 such and such, Mokelumne such and such, so on and so forth, 05 that satisfies us on getting enough water in the pot to go 06 forward and gain this information." 07 So, I think the scheduling of this hearing ought to be 08 oriented to facilitate that. The San Joaquin River 09 Agreement has a potential of bringing parties together. But 10 in our view, you can't settle a fishery flow requirement on 11 the San Joaquin River. I am talking the practical aspects, 12 without dealing with the implications of that on meeting the 13 salinity requirement and how you deal with the drainage 14 problem, of course, the area of origin problem or Stockton 15 East and Central San Joaquin because the Bureau is taking 16 water out New Melones. 17 Our solution to the problem, this would be the 18 practical one, we put on the table after -- we've got to 19 learn more about this drainage. Tomorrow we are going to 20 learn, hopefully, unless you want to delay that. I think 21 there is benefit to get the dialogue going on a limited 22 basis. But our solution would be to take money, you buy 23 water from Friant and willing sellers; you buy water from 24 the Water Contractor Group; you put it down the San Joaquin 25 River, and we have the opportunity of restoring some of the 0714 01 San Joaquin, correcting the drainage and also providing more 02 water so we meet the salinity standard at Vernalis, at the 03 same time the demands in the areas of origin could also be 04 picked up through bringing more water into the picture. 05 I think there is a potential solution, but I don't know 06 how we separate out this one little segment and still leave 07 this thing legally defensible. So, I would urge that we go 08 forward with the modified Phase II; it's on this limited 09 scope. It's kind of a learning, 10 lets-kind-of-warm-up-to-the-issue-type of thing. Let's not 11 go into the full swing of the water rights. That full swing 12 of the water rights is deferred later. I don't know how you 13 separate it from Phase V. It gets deferred later. All 14 parties should have an equal swing at it, equal 15 participation. 16 I have been somewhat disturbed by the rigid structure 17 of the hearings so that people that might want to present 18 evidence, or even come in later, don't have the opportunity 19 to do so. I think we used more time arguing about it than 20 we would bringing the evidence in, getting it on the record, 21 having at it. You, know most of the time it doesn't amount 22 to too much. 23 So, the finality, I'm against that. The idea of 24 separating the two water right groups so only one segment 25 has to present a case at a time, I'm against that. I am 0715 01 against any segmented decision making. I am for going 02 forward with the modified Phase II. I think you can go 03 right into Phase III and Phase IV. Think about it, 04 regroup. 05 Maybe if the Board told everybody out here what their 06 attitude was, general feeling to facilitate getting more 07 effort at working out a total solution on the San Joaquin 08 River, that would be helpful. If we don't do it, we are 09 going to segment it, and we are going to end up with a fight 10 at the end. 11 Thank you. 12 C.O. CAFFREY: Thank you, Mr. Nomellini. 13 Mr. Herrick. 14 MR. HERRICK: John Herrick for South Delta Water 15 Agency. 16 Mr. Chairman, Board Members, I recognize and I should 17 compliment the Board that as different issues arise during 18 these hearings, there is a very good effort to be fair and 19 take into consideration everybody's problems and requests, 20 and it is difficult making rulings on evidence and different 21 things just because this is a big, non court battle. 22 But I don't think the Board and staff understand how 23 disconcerting it is for people like South Delta to sit here 24 while you speculate on how to restructure the entire hearing 25 process before the opposition has been able to stand up. 0716 01 The deadline for submitting -- I am not trying to stand 02 on procedure. I don't believe that is the proper thing to 03 do. The deadline for submitting briefs to the motion was 04 July 9th. July 9th the amended motion came out. Now, 05 it is perfectly understandable that this group of people 06 want to avoid fighting each other if their proposal can go 07 forward. What you are talking about is fundamentally 08 restructuring the hearing process, based on a motion that 09 came out Friday, Thursday. What was the 9th? We don't like 10 that. 11 C.O. CAFFREY: I got that impression. 12 MR. HERRICK: What the request is, is asking you to do 13 everything you can to restructure the process for the 14 benefit of one group of parties. I don't think that is 15 right. We've, for years, been battling this consensus 16 process because it never includes us. 17 One of the counsel just said they want to avoid 18 deciding this according to water rights and responsibilities 19 for harm. I think that is what it is supposed to be decided 20 under. If everybody could work it out, then there is no 21 problem. But everybody didn't work this out. 22 I don't know what a ruling on equivalency means, and I 23 don't think anybody here does. Does that mean that if you 24 rule that the San Joaquin River Agreement has equivalent 25 protection of the plan, does that mean if it's violating the 0717 01 water quality standard at various times, that that is okay? 02 It is equivalent to the plan which has a water quality 03 standard. Is that what that means? I don't know. 04 What they are asking is for us to not be able to put on 05 a comparison of providing all flows and not partial flows. 06 Again, I don't think that is what you want to do. If you 07 want to restructure the whole process, that's okay. But 08 don't do it on a three-day notice. I am not sure how you 09 can do it, issue a written ruling today based on the July 10 9th request. 11 I am not trying to be facetious. Why couldn't I stand 12 up here and say, "I would like you to rule on one of the 13 alternatives with an interim ruling," so to speak, a ruling 14 on equivalency that says that providing all the flows is the 15 best method? I don't understand -- I understand why they 16 want it. But I don't understand how you can do something 17 like that. I don't have any recommendation on what to do at 18 this point, because we are all sitting here with a proposal 19 to change the rules. That's not bad, changing the rules. I 20 am now supposed to put on an argument, and they don't have 21 to address that argument unless somebody indicates they are 22 not happy with it, and then they will do it. And I will 23 have to come back and do it again. 24 Why would you have a partial hearing on Phase V and 25 then have a full hearing on Phase V? That means you are not 0718 01 getting all the evidence on Phase V. The San Joaquin River 02 is the problem here. There is fishery interests, water 03 quality interests. The problem is the San Joaquin River, 04 not enough water coming down. 05 We really object to the Board considering restructuring 06 the hearings to the benefit of one group of parties. We 07 will get into this later. As you know, we are not one of 08 the groups of concensees, if that is a word. 09 I wish I had a recommendation for you on what to do at 10 this point, but I don't see this as legally or procedurally 11 proper. 12 Thank you very much. 13 C.O. CAFFREY: Thank you for your comments, for your 14 argument, Mr. Herrick. 15 Mr. Maddow. 16 MR. MADDOW: Good morning, Mr. Chairman, Members of 17 the Board and staff. For the record, I am Robert Maddow, 18 and I am the attorney for the Contra Costa Water District. 19 We are not one of the concensees, to use the word 20 coined by Mr. Herrick, either, but I would like to make a 21 couple observations and seek one clarification. 22 We submitted a short brief with regard to the original 23 motion by Mr. O'Laughlin, and we were concerned about a 24 number of things at that time, and I will just very briefly 25 mention them. We believe that it does make sense if you 0719 01 were to adopt the San Joaquin River Agreement, after the 02 process, whichever process you follow, that there be 03 considerable amount of certainty in the final result that 04 you reach. 05 For example, Mr. O'Laughlin said today among the 06 members of the group they have reached an agreement as to 07 how they would meet the commitment for flow. I don't know 08 exactly what that agreement is. I do understand what the 09 overall agreement is. It's, in effect, a twelve-year 10 experiment is what someone called it in their papers; it's a 11 12-year effort to approach this with an adaptive management 12 approach, which, we think, probably makes some sense. But 13 we also think we need to be sure that we know to whom we go 14 or you go in the event that there are issues that arise 15 during that 12-year period. 16 So, we are hoping that, for example, if there is an 17 agreement between the members of the group as to who bares 18 what portion of the group's responsibility, that that 19 becomes part of the ultimate order. 20 Similarly, and of perhaps even more importance, is the 21 fact that we want it to be absolutely clear that when you 22 get to the end of this process, if you approve a San Joaquin 23 River Agreement, that you very clearly express the 24 responsibilities of those entities which, by the agreement's 25 terms, would, in essence, backstop the protections that are 0720 01 needed for the Bay and Delta estuary. I am talking, of 02 course, about the state and federal obligations that are, 03 what I think has been commonly referred to as, the backstop 04 through this agreement. 05 We also think it is very important that if you 06 ultimately approve a San Joaquin River Agreement that you 07 make it clear what it is that you are actually approving. 08 And here I am referring to that portion of the letter 09 briefly submitted in which we focused on the fact that the 10 agreement, by its own terms, deals with flow dependent 11 objectives. You have heard a lot of discussion today about 12 Phase V as opposed to Phase II, and we think there are a 13 number of issues other than flow dependent objectives: 14 salinity controls, a number of measures that are discussed 15 in Chapter 2 of the Draft EIR that are of extreme 16 significant. And we don't think that this agreement is 17 going to settle those. We think it is very important in the 18 process that you develop -- that there is a clear 19 understanding that this agreement doesn't settle those 20 nonflow objective matters. 21 Like Mr. Herrick and Mr. Jackson, I, too, share some 22 concern about the fact that we were looking at the original 23 brief submitted by Mr. O'Laughlin, and, of course, there 24 were changes made in the document he submitted last 25 Thursday, and there were perhaps some refinements today. 0721 01 And I don't think that by way of criticism of the group or 02 Mr. O'Laughlin. I think they are struggling with the 03 target, that is a moving target, just as the rest of us 04 are. And, frankly, I commend them for the efforts that have 05 been made by the members of the group to find a way to 06 narrow the focus of this overall hearing. 07 From my perspective, you could help us by doing two 08 things. One is, first, I'll join in the statement that has 09 been made by others, and that is the idea that there be a 10 workshop. I think that is a very good idea now, and I think 11 the workshop ought to be relatively soon, and I think it can 12 be done concurrently with other portions of this hearing 13 which will be going forward. I think it is important that 14 you put out an order today, if possible, which will be the 15 beginning of the understanding of the way in which you're 16 restructuring the hearing. I think you are restructuring 17 the hearing. I don't think that's a fatal flaw. I think 18 the workshop can really help us to fully understand the 19 relationship between what we are now calling Phase II-A and 20 the CEQA and NEPA issues, which are significant, and the 21 balance of the process that we are engaged in. 22 So, my first point is I wholeheartedly join in the 23 suggestion that there be a workshop. I think it should be 24 noticed. I think it should be fairly soon. I would 25 encourage you to instruct your staff to develop the most 0722 01 thorough, first-cut they can at what that future process 02 will be for consideration and attention of the parties at 03 that workshop. 04 My second point is that I would hope that you would be 05 able today to clarify for us that when we discuss settlement 06 agreements and this bifurcation into a Phase II and a Phase 07 II-A, that we are really only talking about this one 08 settlement agreement in that regard. I am not sure about 09 this, and perhaps this is a question that needs to be 10 addressed to the proponents of the San Joaquin River Group 11 motion, but I don't think we need a Phase III-A and I don't 12 think we need a Phase IV-A. If the Board agrees with that, 13 either right now or after some deliberation, I would hope 14 you make that part of the record. 15 And I think the distinction is I don't think there is 16 anything in the Phase III Suisun Marsh Agreement or in the 17 agreements which I am aware of in Phase IV that will be 18 quite like the matter which we have been discussing this 19 morning, being this equivalency subject. I think we are 20 talking about flow augmentation in those other agreements. 21 I may be looking at that short-sightedly or 22 superficially, but from my view of the hearing notice and 23 from my understanding of those other phases, I think what we 24 are talking about hear probably relates only to the San 25 Joaquin. And if the Board concurs with that, I hope we can 0723 01 make that a clear part of the record to facilitate the 02 matter in which we approach the other phases. 03 Thank you very much, Mr. Chairman. 04 C.O. CAFFREY: Thank you, Mr. Maddow. I think what we 05 will do now is take our 12-minute break, and when we come 06 back, we will hear from Mr. Suyeyasu. 07 Thank you. 08 (Break taken.) 09 C.O.CAFFREY: Let's take our seats and resume the 10 hearing. 11 I have a brief announcement from the Court Reporter, 12 that the transcripts for Phase I are ready, except for 13 yesterday's, which will be probably be available on Monday, 14 for those of you wishing to get copies of the transcripts 15 from the Court Reporter. 16 I had announced before we broke that Mr. Suyeyasu would 17 be next. I am making a change in that order to accommodate 18 Ms. Cahill who has to go to court. So, Ms. Cahill, we will 19 start with you. 20 MS. CAHILL: Thank you, Chairman Caffrey. 21 Good morning, Members of the Board. Virginia Cahill on 22 behalf of the City of Stockton. Basically, we are in 23 agreement with the approach outlined by Mr. O'Laughlin. We 24 believe there is merit to separating out a Phase II from a 25 Phase II-A. 0724 01 As he's recognized, there is some overlap between the 02 Phase V issues and Phase II-A issues. We don't really care 03 if those are taken up in Phase II-A or Phase V or combined 04 phase. So long as it is clear which phase we need to put 05 that evidence in. Specifically, the EIR in chapter eight 06 has various alternatives for salinity in the San Joaquin 07 Basin. In chapter nine it has various alternatives for 08 South Delta salinity, and chapter ten has various 09 alternatives for meeting the DO standard. 10 We would hope that whatever ruling you put out today 11 would make it very clear where the evidence on those 12 alternatives should be presented, even if some of the 13 parties to the San Joaquin River Agreement will be 14 responsible for those particular alternatives. I think the 15 reason we are in sort of the bind we are is the definition 16 of flow dependent alternatives says it can meet either with 17 flow or with the other means. And so, some of those other 18 standards aren't really purely flow or purely other 19 methods. 20 And so it seems to me that the focus on those chapters 21 eight through eight in the Environmental Impact Report was 22 on the other methods, and I think the thrust of the San 23 Joaquin River Agreement is on flows. In fact, the agreement 24 itself says that it determines the obligations to mitigate 25 impacts on the water quality resulting solely from end 0725 01 reduction in flows in the San Joaquin River, but will not 02 affect the responsibility of the parties to mitigate impacts 03 on water quality resulting from discharges of waste into the 04 San Joaquin River. That is Paragraph 12.1 of the 05 agreement. 06 So, the real question is: Does Phase II-A address the 07 validity of the agreement or does it fully address all the 08 responsibilities of the parties to the agreement? In any 09 case, I think the new phasing that is recommended is a good 10 idea. We don't object to Phase V going before Phase II-A. 11 All we really ask is that you make it clear in your order so 12 the parties know how they ought to proceed with the evidence 13 on those topics. 14 C.O. CAFFREY: Thank you, Ms. Cahill. Since you are 15 about to leave, I will make this announcement. I was going 16 to wait until after we heard all the arguments. 17 As I listen to the arguments, I want to be able to put 18 out a ruling that has reasoning it in, that hopefully 19 addresses a number of all the points that are being raised 20 on both sides of the issue. I think I've been optimistic as 21 I listen here this morning and still have more arguments to 22 listen to, optimistic in my appraisal that we would have an 23 order out this afternoon. I think it is going to be 24 tomorrow. 25 That being the case, rather than to try to make almost 0726 01 an impossible deadline and put on the Internet that we are 02 cancelling tomorrow, we didn't make, I think I will just say 03 now, expect the ruling in writing tomorrow. We will not 04 meet tomorrow, and we will start with Phase II on Tuesday 05 morning of next week across the street or here, but right 06 now it is scheduled for across the street. If it's going to 07 be here, we will post it. 08 That is what we had some discussion on up here during 09 the break, and it will give us all a little bit of time to 10 ruminate on some of those arguments. I wanted to say that 11 before you left since you raised it and provided a nexus. 12 MS. CAHILL: Thank you, Chairman Caffrey. Thank you 13 for accommodating me. 14 C.O. CAFFREY: Thank you very much. 15 Mr. Suyeyasu, are you here, sir? 16 Good morning, sir, welcome. 17 MR. SUYEYASU: Thank you, Mr. Chairman. Members of the 18 Board, Dan Suyeyasu from the Environmental Defense Fund. 19 I understand that there may be a separate workshop on 20 these issues, but because the San Joaquin River Group 21 Authority has not withdrawn their motions regarding an 22 interim decision after Phase II, I do feel obliged to 23 address those issues now, and that is what most of my 24 comments will be on. 25 The Environmental Defense Fund remains opposed to any 0727 01 phased decision making by the Board. When these hearings 02 are concluded, we look forward to seeing a single decision 03 by the Board that fully implements flow dependent objectives 04 of Water Quality Control Plan. Due to the significant 05 interrelationships between all have the objectives and all 06 the parties at these hearings, we do not think it is 07 possible for the Board to concurrently do the following 08 three things: 09 One, enter an interim decision releasing some parties 10 of liability. Two, protecting interests of nonsettling 11 parties. And three, insure that the Water Quality Control 12 Plan is fully implemented. 13 Because the procedural and property interests of the 14 nonsettling parties are protected by both the state and 15 Federal Constitutions, it is our fear that any premature 16 release of liability will once again leave the environment 17 with the water that it so dearly needs and deserves. 18 Deciding whether or not to enter an interim decision 19 approving the San Joaquin River Agreement, maybe so somewhat 20 of a hypothetical question, however, since the San Joaquin 21 River Agreement is not actually an agreement yet. Currently 22 it is only a letter of support for an agreement. 23 The actual terms of the San Joaquin River Agreement 24 will not be known by any parties here until the agencies 25 involved in that agreement finish their required NEPA, CEQA 0728 01 and Endangered Species Act reviews of the agreement. Those 02 agencies currently perceived completing such review in March 03 of '99, at least the last I heard. 04 It should be apparent that the Board cannot accept or 05 approve that agreement until it knows what the terms of the 06 agreement will be, and until the parties to the agreement 07 actually commit to providing the flows in the agreement. 08 Even the San Joaquin River Group Authority's latest 09 proposed schedule, although there might be a later one now, 10 encompassing Phase II-A envisions the Board approving the 11 San Joaquin River Agreement at the end of this year, two 12 months before any of the parties to the San Joaquin River 13 Agreement could actually agree to provide a single drop of 14 water. 15 Phase VIII is to encompass the responsibilities of 16 those parties who are not party to accepted agreements. 17 Assuming that Phase VIII commences before March of 1999, 18 that may be a big assumption now, the advocates of the San 19 Joaquin River Agreement will have no choice but to 20 participate in Phase VIII since the agreement cannot 21 possibly have been accepted by that time by the Board. 22 While we do not object to the new schedule put forth by the 23 San Joaquin River Group Authority, we do see Phase II-A as 24 somewhat unnecessary since we believe that all parties 25 should and will be present in these hearings in Phase VIII. 0729 01 To be clear, EDF certainly concurs that negotiated 02 settlements are a desirable means to implement the Water 03 Quality Control Plan. But it is our view that such 04 agreements will not, and cannot, absolve the Board of its 05 continuing responsibility to protect the natural resources 06 of the Delta. It's our view that the Board will be 07 abdicating that responsibility if it enters any decision 08 releasing a party of liability for a given objective before 09 the Board has concluded that all objectives will be fully 10 implemented by that decision. 11 We do have one suggestion for proceeding with this 12 hearing, although, now that I think about it, two days ago, 13 it looks like it may fall into the same NEPA/CEQA problems 14 that the current process is suffering from. 15 C.O. CAFFREY: There in lies the overall dilemma. 16 MR. SUYEYASU: There it is. Because the Board is well 17 aware that these hearings are significantly constrained by 18 the requirements of due process and the terms of the Water 19 Quality Control Plan, and the settlement agreements are 20 inherently much more flexible, we would suggest that those 21 parties wishing to present settlements to the Board work to 22 conform those settlements to the hearing process. 23 What we currently have is a case of a tail trying to 24 wag the dog, and it simply will not work. We have heard 25 that those parties advocating settlement believe that they 0730 01 cannot concur with such variables, present adversarial 02 evidence against their agreement partners. We do not, 03 however, see this as a mandating-phase-decision making. One 04 conceivable alternative would be for all parties to 05 settlement agreements to agree not to present any 06 adversarial evidence against their agreement parties in 07 these hearings, Phases II through VIII, and to agree that 08 the cumulative obligations imposed on the agreements' 09 parties by the Board, if above or below that considered by 10 their settlements could be distributed amongst the parties 11 through mandatory arbitration outside of these hearings. 12 The obligations imposed by the Board would, of course, 13 always remain as a regulatory backstop to be enforced by the 14 Board, if necessary. While parties to the agreements may 15 see this as too much of a risk, if their agreements are as 16 equitable and fair as they say they are, it certainly will 17 present a lot less risk than everybody going into a 18 contentious Phase VIII process. 19 The San Joaquin River Group Authority did state 20 earlier, if Phase V were to come before Phase II, that they 21 would like the deadline for submission of evidence for Phase 22 V to be as late as possible. We would like to urge the 23 Board to actually keep these proceedings moving along as 24 quickly as possible and to enter or issue a motion for the 25 submission of Phase V as soon as possible. 0731 01 Thank you for consideration of these matters. Any 02 questions? 03 C.O. CAFFREY: No, Mr. Suyeyasu. We are just going to 04 hear the arguments, then we are going to put out our 05 ruling. Thank you for that offer and thank you for 06 your presentation. 07 MR. SUYEYASU: Thank you. 08 C.O. CAFFREY: Mr. Lily. 09 MR. LILY: Good Morning, Chairman Caffrey, Members of 10 the Board. I am Alan Lily of Bartkiewicz, Kronick & 11 Shanahan, and I am appearing this morning on behalf of two 12 of our clients: the Yolo County Flood Control and Water 13 Conservation District, which has executed a settlement 14 agreement, and the Yuba County Water Agency, which is still 15 working diligently to attempt to execute a settlement 16 agreement. 17 C.O. CAFFREY: I want to apologize on record. I turned 18 the system off at break time and forgot to turn it back on. 19 It is the prerogative of the Board to determine the 20 actual length of a minute. 21 MR. LILY: We will talk about the theory of special 22 relativity later. 23 C.O. CAFFREY: I know that you are trained in 24 theoretical physics, Mr. Lily, so I couldn't pass that up. 25 MR. LILY: I will take a few more minutes here. 0732 01 C.O. STUBCHAER: It's a failed device. It's not 02 operator; it's device. 03 C.O. CAFFREY: We will rely on Mr. Stubchaer's watch. 04 MR. LILY: Neither the Yolo County Flood Control Water 05 Conservation District nor the Yuba County Water Agency is 06 directly involved in the San Joaquin River Agreement or in 07 Phase II. But the same issues are likely to come up in 08 Phase IV and perhaps in a subsequent phase, if there is one, 09 regarding the Sacramento River agreements, if such 10 agreements are executed. So, I want to make a couple 11 comments for the Board. I think it will be important for 12 the Board' decision-making process for both Phase II and 13 subsequent Phase IV and others. 14 The first point is that it is just absolutely critical 15 that the State Board issue an order on the settlement 16 agreements before Phase VIII starts. Otherwise, it places 17 the signed parties to the agreements in an impossible 18 position of having to, on one hand, advocate a settlement, 19 and on the other hand, having to make their water rights 20 arguments, and that will just be unprecedented in either a 21 litigation context or an adjudication context to force a 22 party to both advocate a settlement and advocate all its 23 legal positions in evidence at the same time. 24 Particularly where the settling parties have made peace 25 and yet in Phase VIII, if there is Phase VIII and the 0733 01 settlements are not approved, would have to go and basically 02 make very strong legal arguments against one another. It's 03 just not feasible, and, therefore, it is critical that the 04 Board issue decisions, either approving or not approving the 05 settlement agreements, before Phase VIII starts. 06 Now the nonsettling parties certainly have an 07 opportunity and should be given a full opportunity to 08 present all of their evidence and arguments in opposition to 09 the settlement agreements, both settlement agreements in 10 Phase II and subsequent phases. And I think Mr. O'Laughlin 11 clearly recognized that in his statement this morning. 12 If they are presented with such an opportunity, they do 13 not have any subsequent argument about denial of due 14 process. Frankly, there has to be a difference in the 15 treatment of evidence submitted by settling parties and 16 nonsettling parties. That is what a settlement agreement 17 does. There is an analogy here in the civil litigation 18 context where I am often involved. There are often cases 19 involving multiple defendants. Take for example a car 20 accident where the injured plaintiff sues numerous parties. 21 It happens all the time. 22 It also happens all the time that some of the 23 defendants will settle with the plaintiffs and some 24 won't. And the court system has adopted a process where the 25 settling parties have their settlements approved by the 0734 01 court. The nonsettling parties can object if they think the 02 settlements are unfair. But if the settlements are 03 approved, the settling parties are out, and the case just 04 proceeds with the nonsettling parties. That is what we are 05 proposing here. 06 One of the critical elements in the Bay-Delta context 07 is the backstop that we talked about, where the state and 08 federal water projects basically would backstop any 09 agreements; and with those backstops, the same amount of 10 water is going to flow to the Delta with or without a 11 settlement. The only issue is the timing of who provides 12 what water when. So, really, the backstops do take care of 13 nonsettling parties' concerns that they would somehow be 14 unfairly treated if there is an approved settlement before 15 Phase VIII starts. 16 The only other comment I would like to make, if the 17 settlements are not approved, and certainly it is not a 18 given that they will be at this stage, the Board has not 19 issued any decision yet, then there will be additional 20 issues in Phase VIII. Phase VIII will be a much broader 21 proceeding. I think it will be possible for the Board to 22 incorporate testimony from earlier phases, and, obviously, 23 no need for someone to get up here and say the exact same 24 thing that he said in an earlier phase, assuming that all 25 parties have full rights to cross-examination and to submit 0735 01 rebuttal evidence in Phase VIII. 02 I think there is a way that the Board can deal with 03 that. There clearly will be some duplication of effort in 04 testimony, but the advantage of having settlements far 05 outweighs the risk that there may be some duplication in 06 Phase VIII. 07 The only other thing I wanted to comment on today is 08 CEQA. We have heard some comments on CEQA, and I just 09 wanted to make two points that I think are very important 10 regarding CEQA: The first is there's clearly no requirement 11 that the State Board certify a final EIR before it hold its 12 water right hearing. Frankly, I don't -- it is very rare, 13 if ever, that this Board has done that. The Board almost 14 always follows the process of holding a hearing and then 15 later certifying a final EIR. Of course, it has to be 16 certified before any water right decision is issued, but it 17 does not need to be certified before a water right hearing 18 is held. So there is nothing to stop this Board to certify 19 its Bay-Delta EIR before Phase VIII and then issuing its 20 order on the settlement agreements before Phase VIII. And 21 that Final EIR can be the document for Phase VIII. It does 22 not need to be certified before the earlier phases are 23 done. 24 The other thing that I just want to emphasize because I 25 think there has been some misunderstanding about this. 0736 01 There is no requirement in CEQA that the Final EIR have a 02 preferred alternative. In fact, some purists would say a 03 Final EIR never should have a preferred alternative because 04 a preferred alternative indicates some predisposition of 05 the agency in one direction, and the whole point of CEQA is 06 to keep your mind open as the decision maker until you've 07 heard all the evidence and consider all the alternatives and 08 made the decision. 09 I think here the Board would have a real dilemma if it 10 certified a Final EIR before Phase VIII, as would be 11 necessary to issue an order on settlement agreements with a 12 preferred alternative. Because then the Board would be 13 subject to the criticism that it had, in essence, prejudged 14 or predetermined, or at least had indicated a predisposition 15 in favor of certain alternatives before Phase VIII started 16 and certainly before there was any water right decision on 17 Phase VIII. 18 The Board can easily get out of that by having a Final 19 EIR without a preferred alternative. That will provide a 20 CEQA document that is necessary to support a decision on the 21 settlement agreements and yet will not predispose the Board 22 in any certain direction on Phase VIII. 23 So, with that, unless you have questions, that is all I 24 have for this morning. I appreciate your time. 25 C.O. CAFFREY: Thank you very much, Mr. Lily. 0737 01 Ms. Forster has a question. 02 MEMBER FORSTER: I was going to ask you this before 03 you got into your conversation on EIRs and CEQA. Maybe you 04 helped it. 05 When you said there are settling parties and the judge 06 lets out the settling parties, isn't the difference that the 07 judge doesn't have to look at CEQA and NEPA? 08 MR. LILY: Well, certainly, that is a difference. That 09 is why we are saying in this case the Board does, and I 10 don't think there is any dispute among anybody here today, 11 that the Board, since it is subject to CEQA, where a court 12 is not, clearly has to certify a Final EIR before it can 13 issue a decision on the settling agreements. I don't think 14 there is any question about that. What I am saying is that 15 that can be done before Phase VIII starts and, in fact, 16 should be done before Phase VIII starts here. 17 C.O. CAFFREY: Thank you very much, Mr. Lily. 18 MR. LILY: Thank you. 19 C.O. CAFFREY: Mr. Candee. 20 Morning again, sir, welcome. 21 MR. CANDEE: Morning again. Thank you, Mr. Chairman. 22 Just a few quick remarks from NRDC. 23 We do support the new approach of separating out Phase 24 II and Phase II-A, and like the proposal in the Natural 25 Heritage Institute memo that focuses first on the 0738 01 equivalency issue. Having said that, I must add I find a 02 lot of the testimony we have had in the last hour very 03 compelling about some of the problems that may come up with 04 the larger process. 05 I would ask that before the day is over that you 06 clarify whether or not the order that you are planning to 07 issue will be on the new document that Mr. O'Laughlin has 08 been asked to prepared, summarizing his revised motion and 09 just so we know what the process is. Maybe I missed 10 something; maybe he is not submitting that. 11 C.O. CAFFREY: I think where we left that, if I may 12 clarify, hopefully I will clarify. This is my understanding. 13 We are not going to ask him to submit that for the purpose 14 of preparing this motion. Basically asked it as a courtesy 15 on behalf of Ms. Forster and the rest of the Board just so 16 we have information available on the record, on the general 17 record, for reference. 18 But we will produce a motion probably tomorrow, no 19 later than tomorrow, that will deal with the arguments that 20 we have heard today. 21 MR. CANDEE: Thank you, Mr. Chairman. 22 Just a few points of clarification. As I said earlier, 23 I think the issue of interim orders and whether or not you 24 can and when you can issue, is a very tough issue. I don't 25 think there is consensus on that yet, and I think perhaps 0739 01 further briefing on that point and perhaps a workshop does 02 make sense. 03 There is this question that is out there which is, the 04 federal government is a party to the agreement. They are 05 doing a NEPA process. Under federal law they can't sign any 06 agreement until they have gone through that process. 07 Hopefully, they will be affected by and informed by that 08 NEPA process. So what is the agreement that you are 09 reviewing? That is a little detail out there. 10 I want to mention a couple other things. The 11 equivalency determination we see as a floor and not a 12 ceiling. It is just a threshold determination. Is this a 13 viable alternative to proceed to Phase II-A where you are 14 comparing alternatives? As Mr. O'Laughlin said, if you say 15 no, then it is gone, the San Joaquin River Agreement is not 16 even in the process. It is not, as I understand the 17 proposal from both NHI and the San Joaquin River Group, it 18 is not a final determination by the Board as to what is the 19 best method environmentally for carrying out the plan. That 20 is exactly the issue in Phase II-A or turns out to be Phase 21 VIII, which is what is the best way to carry out the Water 22 Quality Plan. I think that is an important distinction. 23 Second, I want to mention that there are a lot of 24 other aspects in Mr. O'Laughlin's original motion, which I 25 think was superseded by his July 9th brief, and we are 0740 01 grateful for that. But also, I think the proposal today is 02 somewhat different than the July 9th brief. We haven't 03 gotten into all of those details. I think Mr. Nomellini, or 04 somebody, made the point, maybe Mr. Herrick, that the July 05 9th brief was sort of a new proposal and there haven't been 06 responses to that. So whether there are details on rebuttal 07 testimony or whatever, I don't know whether the Board will 08 get into that. But there certainly are outstanding 09 questions about some of those details. 10 I think that the important thing now is to figure out 11 whether there is going to be a Phase II and Phase II-A as 12 proposed by the San Joaquin River Group this morning, and 13 if there is going to be a Phase II-A, is it going to be in 14 the fall so that there is time for all parties to submit new 15 testimony, maybe 30, 60 days from now, whatever it may be, 16 so that we know when we are going to be putting in evidence 17 comparing Alternative 5, or what have you, to the San 18 Joaquin River Agreement. 19 I think that is all I have to say, so thank you very 20 much. 21 C.O. CAFFREY: Thank you very much, Mr. Candee. 22 Appreciate it. 23 Mr. Porgens, I am not sure. You submitted a card for a 24 policy statement. Are you wishing to make a policy 25 statement or are you going to comment on Mr. O'Laughlin's 0741 01 motion? 02 MR. PORGENS: That is a good point, but I think I am 03 going to comment on his motion. That is the latest phase we 04 are in now, right? 05 C.O. CAFFREY: Right. With regard to the policy 06 statement, we are not taking those today. I would 07 accommodate you if you are not able to make it next Tuesday. 08 MR. PORGENS: I don't know what day I am going to be 09 able to make it anymore, Mr. Chairman, because everything 10 just keeps changing. I don't know what day is what day 11 anymore. 12 C.O. CAFFREY: Today is Wednesday. 13 MR. PORGENS: Appreciate that. That is very kind of 14 you, Mr. Chairperson. I wasn't talking in the context of 15 the way you put it. I am talking about in terms of the 16 hearing process. 17 C.O. CAFFREY: Why don't you make comments today 18 specific to Mr. O'Laughlin's motion. And then we will hear 19 your policy statement Tuesday, and I will take you up first 20 then if you wish to make a policy statement when we hear the 21 rest of it. Okay? 22 Please proceed. 23 MR. PORGENS: I am Patrick Porgens. I am with Porgens & 24 Associates. I am de facto public trustee. 25 I have to tell you, Mr. Chairman, I am just totally -- 0742 01 I am getting lost. I'm sorry I have to go through this with 02 you. I turn around; I come in here today. We are in a II-A 03 phase. I am just frustrated. I am totally frustrated, and 04 the way this whole hearing process is being conducted. I am 05 sorry, I sympathize with the Board. I really do. But you 06 have to take into account what is going on over here. I 07 can't put all this time into this changing, moving target. 08 I am really taken back. 09 C.O. CAFFREY: Mr. Porgens, we -- 10 MR. PORGENS: I am going to address the issue. 11 C.O. CAFFREY: Excuse me. We can't both talk at the 12 same time. So when I am talking, that is the only person 13 that talks. 14 MR. PORGENS: Okay. 15 C.O. CAFFREY: We are all suffering under some of those 16 frustrations, but we are -- this is a very complicated 17 process when you start phasing evidentiary hearings and 18 water rights. It is complicated. There are a number of 19 documents that the staff has produced, and we are actually 20 considering a motion today pertinent to those documents and 21 that process. 22 So all I can do to help you is to refer you to those 23 documents and encourage you to read them and perhaps discuss 24 it with the staff. What I don't want to do, as I announced 25 yesterday when I don't believe you were here, we don't want 0743 01 to take a lot of time in these hearings to discuss process. 02 So I encourage the parties and their representatives, if 03 they have questions about the process that they cannot find 04 in any of the written material that we put out, that they 05 put their question in writing and we will deal with an 06 answer in writing and provide it to all the parties. That 07 is what I would refer you to. I understand that you are 08 frustrated, and we will try to help you along the lines that 09 I just described. What I need you to do today is speak 10 specifically to Mr. O'Laughlin's motion if, you understand 11 it, sir. 12 MR. PORGENS: I would like to respond briefly. First 13 of all, I don't need any extra help. This process is more 14 complicated than it needs to be. That is my point. It's 15 been going on since '87. It's out of hand. It's totally 16 out of hand. I am only here under protest, Mr. 17 Chairperson. 18 Getting to the specifics of this phase, Mr. 19 O'Laughlin's points he stated in his motion. I'm opposed to 20 any phasing of any part of this hearing process. I'm 21 opposed to making any interim orders relative to this 22 process. 23 In listening to this gentleman's, over here, his two 24 bites from the apple, well, I am looking at who is holding 25 the apple here. And I believe that the way this process is 0744 01 now set up, and with all due respect to Mr. O'Laughlin and 02 his group, I appreciate the fact that they put a lot of time 03 into this, and I was really inspired by their statement that 04 it is not based on fault or water rights. 05 I can't disagree with them more on that point. I am 06 coming in after everybody on the unreasonable use issue, 07 which this Board has never addressed. And the single 08 largest, highly water-quality-impaired area in the United 09 States is right down there in their client's area. 10 So, no, that's not good. We have -- that has to 11 change. We -- I can't go along with that. I appreciate the 12 fact that you are the Chairman of the Board and everybody 13 else up there is appointed to the Board. But I also 14 appreciate the fact that I am a citizen and that I have due 15 process rights, and that you have a right to protect my 16 water. 17 Getting back to this issue here, I don't believe that 18 this agreement, which I don't know all the details of the 19 agreement, Mr. Chairperson. I don't know all the details. 20 I don't know who is going to comply with what. I don't know 21 how they are going to specifically comply. 22 Then I hear a lot about backstop, and that there is 23 going to be a federal and state government backstopping to 24 meet these requirements. You know, I recognize a few faces 25 here. I also remember coming to the Board and showing that 0745 01 the state and federal government failed consistently to meet 02 D-1485 and D-1422. It's in the record. 03 So, as far as somebody coming back here and 04 backstopping something as part of this phased process, I 05 don't see that happening, Mr. Chairman. 06 So, in conclusion, I would say that I would caution the 07 Board from going forward and making any decision relative to 08 any of the particular agreements that are being proposed 09 without having all the information in order, without me as 10 an individual having the opportunity to go through all of 11 this stuff and to review the data so I can come back and 12 make an intelligent presentation to the Board. 13 One last thing, Mr. Chairperson, I have to make a 14 living and I work very hard, and I can't keep the schedule 15 you keep moving. This is a moving target. And I can't keep 16 rescheduling myself because I have other clients that I have 17 to take care of. So every time I come in, we are going to 18 have the hearings on this day, that day, that day. We are 19 changing to this day, that day. That is not fair. It's not 20 fair to me. I can't deal with that. I want something done 21 here, and I realize that it is a new and evolving process, 22 and we are learning as we go along. I am quoting you now, 23 Mr. Chairperson, we are learning as we go along. 24 You have had about ten years to do that. And I don't 25 see where this agreement is going to resolve any of the real 0746 01 problems associated with the San Joaquin River. Because no 02 matter how much water they're providing, they are not going 03 to meet the standards as it relates to the 5 parts per 04 million, the increase in toxic materials coming from there. 05 They are going to continue. I don't see any real reduction 06 in the amount of land in production. I don't see. And I 07 see more water being exported in the last three years on 08 average than in any other time in history. 09 You got what I am all about, Mr. Chairperson? 10 C.O. CAFFREY: I'm sorry? 11 MR. PORGENS: You understand what my position is? 12 C.O. CAFFREY: Yes. 13 MR. PORGENS: I opposed -- I'm opposed to that. 14 C.O. CAFFREY: Yes. You are on the record for opposing 15 a phased hearing process. 16 MR. PORGENS: And I am opposed to this Board making 17 any decisions without having all the information before it. 18 And do not, I am saying, do not make any interim orders. 19 Because all it will do is it will set ourselves up. This is 20 a 14-year experiment program. This is based on baseline 21 that's already been, you know, happened. We are not even 22 talking about what is going on now and in the future. 23 So, thank you very much, Mr. Chairman. 24 C.O. CAFFREY: Thank you very much, Mr. Porgens. 25 Mr. Schulz. 0747 01 MR. SCHULZ: Good morning. 02 C.O. CAFFREY: It is morning. 03 MR. SCHULZ: It still is. 04 Mr. O'Laughlin made his presentation on behalf of the 05 San Joaquin River Group, and there has been another major 06 side of the negotiation of the San Joaquin River Agreement; 07 and that has been the export both of the state and federal 08 sides. So, on behalf of those exporters and working with 09 them, we support what Mr. O'Laughlin has suggested in terms 10 of a phasing. And that goes with the Golden State Project 11 and for the federal groups that it involved in the 12 negotiations. We have been involved in the phone 13 conferences and the meetings to try to work a proposal out 14 that Mr. O'Laughlin provided today. 15 Couple additional comments. We do want to see Phase V 16 go first and not be joined with Phase II-A because we 17 believe that Phase V is broader. It is a more all 18 encompassing. There are things in Phase V that aren't part 19 of the San Joaquin River Agreement. And then what we would 20 see is a Phase II-A following immediately thereafter. You 21 can receive testimony as part of II-A, as to how Phase V 22 concerns are affected by the San Joaquin River Agreement. 23 But if you flip it over and do it the other way, you will 24 get, I think, an expansion of the Phase II-A in areas that 25 will not be helpful to you in deciding how to go with the 0748 01 agreement or not. We would like to see Phase V go first. 02 We added II-A for due process reasons, not to benefit 03 the proponents of the agreement, as was suggested earlier. 04 The Board's June 9th letter let some people not put in 05 evidence comparing the agreement to other alternatives that 06 are set forth in the Draft EIR. 07 We thought those parties needed an opportunity to 08 present direct evidence on the alternative issues, and that 09 is why we suggested II-A, because our initial proposal was 10 to have that all done in II. So, why not, to make sure 11 everybody understands it, we thought II-A was necessary to 12 protect the Board from a due process charge if it didn't 13 give an opponent to the agreement another opportunity to 14 submit direct evidence as to why they think, say, 15 Alternative 5 should be approved by the Board rather than 16 the agreement. 17 With respect to equivalency, and this is a little bit 18 in response to South Delta. I want to emphasize the 19 equivalency finding that we are going to be asking you to 20 make after Phase II, if you go along with our proposal, only 21 deals with environmentals equivalency during the pulse flow 22 period. That is the language of the agreement. 23 So, we are not asking, and we would not expect you to 24 make a finding of equivalency with respect to other 25 standards such as the interior South Delta salinity 0749 01 standards for agricultural purposes. Evidence with respect 02 to that would come in in II-A, as to why one alternative was 03 better than another in meeting those standards, or in V or 04 in a combination of both. An equivalency finding would in 05 no way put any constraints to proponents to the agreement by 06 putting evidence in V and II-A with respect to what the 07 agricultural salinity purposes in the interior South Delta. 08 Mr. Maddow asked whether or not Phases II and IV would 09 need similar bifurcation. Some of you who have been 10 involved a great deal in the Sacramento River negotiations, 11 I don't think that there would be any need for bifurcation 12 of those areas. The need for bifurcation came up because of 13 the confusion about whether or not within a particular phase 14 on settlement agreements parties would be expected to put on 15 evidence with respect to alternatives to the settlement 16 agreement. 17 I think that now that we know that, yes, that is what 18 would be expected in a phase on settlement agreements. We 19 can have Phases III and IV in one single proceeding where 20 the agreements are presented and opponents to the agreements 21 believe another alternative should be adopted and present 22 evidence on that factor. So, I don't think similar 23 bifurcation would be required. 24 Finally, I want to agree with something that Mr. Candee 25 said. The affect of equivalency should not be viewed as a 0750 01 decision as to whether this Board will approve the 02 agreement. It is sort of a baseline provision that is in 03 the agreement. We agree that the agreement could only be 04 approved by this Board after the evidence in II-A came in 05 and after the Board finalized the EIR. 06 So, nobody should feel that a finding of equivalence as 07 anything more than a stepping stone towards the rest of the 08 determinations that the Board would have to make in order to 09 decide whether to approve the agreement. 10 With that I will close and say that we request the 11 Board issue an order setting up the II and II-A process and 12 putting II-A immediately after five. 13 C.O. CAFFREY: Thank you for your comments, Mr. 14 Schulz. 15 That completes the list that I have. Is there somebody 16 else wishing to offer argument? 17 MR. ETHERIDGE: If I may, Mr. Caffrey. 18 C.O. CAFFREY: Please identify yourself. 19 MR. ETHERIDGE: Good morning, Mr. Caffrey and Members 20 of Board. I am Fred Etheridge from the Office of the 21 General Counsel of East Bay MUD. 22 I have a very brief comment which Mr. Maddow and Mr. 23 Schulz have touched on earlier. And that is whether Phases 24 III and IV should also be bifurcated, as Phase II has been 25 proposed to be bifurcated. And we don't think there is any 0751 01 need to do that. We think that for the San Joaquin Phase II 02 the reasons for bifurcation in that phase have been fully 03 and ably argued to you this morning. 04 But Phases III and IV don't share the need for that 05 bifurcation. There is no threshold question. So we are 06 proposing to proceed as planned with Phases III and IV and 07 to hear the settlement agreements that are the subject of 08 those two respective phases, hear all evidence both for and 09 against those settlements in those phases. 10 Thank you. 11 C.O. CAFFREY: Thank you, Mr. Etheridge. 12 That completes the list that I have of individuals 13 wishing to make argument. I will give Mr. O'Laughlin a 14 brief period, just call it 15 minutes, if he wishes to 15 close. 16 MR. O'LAUGHLIN: Hopefully, not that long, Mr. 17 Chairman. 18 A couple quick notes, and we can move on. I think what 19 you heard today, as I sat there and listened, we do have an 20 agreement among all the parties, I think, for the desire to 21 truly understand how we go from phasing to implementable 22 order. So with that, I leave it up to your staff and you to 23 figure out how best we do that and the methodology upon 24 which we do that, whether that is a workshop or further 25 briefing or combination thereof. I think it is an extremely 0752 01 important point, and the participants in this audience and 02 in this process agree, as well. 03 A couple of other points, very briefly, echoing up on 04 Mr. Schulz's comments. Our motion does not go to Phases III 05 and IV. In fact, the San Joaquin River Group Authority 06 believes that there is no need to bifurcate II and IV to 07 proceed. The evidence and testimony has been submitted. 08 The hearing dates are set, and we see no need to slow down 09 and stop on those phases. 10 The other thing I would like to address is the need to 11 continue to go forward. I am somewhat perplexed by the 12 opponents to this motion arguing on one hand that we need to 13 finish CEQA before we do anything and arguing on the other 14 hand that they definitely need to proceed forward 15 expeditiously. 16 If they truly believe that the core cannot have phasing 17 until the CEQA document is done, then we should stop right 18 now, wait until December or January when the CEQA document 19 is done and then start all over. 20 The other problem that I had with some of the general 21 comments that were made is the purpose of phasing to try to 22 effectuate settlements. Because the goal being that, 23 hopefully, by effectuating settlements, we resolve the issue 24 without having an adversarial process that would take us, as 25 Mr. Porgens said, years and years and years. 0753 01 So, if we are going to do that, we have already set in 02 motion phasing and we have already set in motion 03 settlements. And we have set in motion the policy to try to 04 effectuate those settlements. So, if everybody wants to 05 just go to Phase VIII, there is no reason to have phasing at 06 all. The purpose of phasing is to try to effectuate the 07 settlements. Now, that is not to say that the Board is 08 going to adopt the settlements. But at least we will get a 09 chance to air those settlements in front of you without 10 first having to tear them down. 11 The other point that I take is -- I am somewhat 12 disturbed by is that our original motion was very strict, 13 very direct, very procedurally correct, I believe. I mean, 14 we took a very hard line in that motion about what Phase II 15 should be about, the submittal of testimony. What we are 16 trying to do here is not to be exclusive, but rather be 17 inclusive. It wasn't us that went out looking for a Phase 18 II-A hearing. We submitted all of your testimony for Phase 19 II prior to June 15th. 20 If other parties, such as South Delta Water Agency, did 21 not understand the process and did not submit testimony, we 22 are now giving them the opportunity to present as much 23 testimony as they want in both Phase II, II-A and Phase V. 24 And if all that doesn't work there, then we will see it all 25 again in Phase VIII. 0754 01 So, rather than to say that we are limiting testimony, 02 that it's an unfair process, what we are trying to do is 03 bend over backwards and let the process be as inclusive as 04 possible so that we can protect ourselves procedurally as we 05 move forward. 06 And finally, the last thing I would like to note is 07 that there is comments made about the CEQA. CEQA is not an 08 evidentiary document. CEQA is a planning document for the 09 State Water Resources Control Board. As your notice clearly 10 set out in your CEQA document and in your notice of the 11 hearing, it said this report and other evidence will be 12 considered by the State Water Resources Control Board in 13 making its decisions. 14 But CEQA doesn't have to be done prior to the phasing 15 going forward. In fact, as Mr. Lily said previously, every 16 time I've appeared in front of the State Water Resources 17 Control Board the EIRs are usually not done, and the hearing 18 process goes forward. But we all clearly recognize that the 19 CEQA will be done prior to any orders being issued. 20 I think that the clearest way to go forward and protect 21 the procedural due process rights of all the parties 22 involved, to try to effectuate the policy of having 23 settlements, is to now bifurcate Phase II into II and II-A 24 with Phase V coming beforehand so that we can truly proceed 25 forward in an expeditious fashion and try to resolve these 0755 01 phases prior to end of the year end with the completion of 02 your CEQA document hopefully being coterminous with that. 03 Thank you, Mr. Chairman, Members of the Board. 04 C.O. CAFFREY: Thank you, Mr. O'Laughlin, and thank you 05 to all who offered their concerns and suggestions and their 06 arguments this morning. The Board appreciates it very much. 07 We will take all this information under submission, and we 08 will produce, sometime tomorrow, a written order or ruling, 09 if you will, on this motion. 10 We will then meet to begin Phase II, the regular 11 hearing process for Phase II, on Tuesday of next week. We 12 are currently scheduled -- it is Tuesday, is it not, Mr. 13 Pettit? 14 Yes. We are currently scheduled for our hearing room 15 across the street. If we are able to get a bigger room, we 16 will let you all know as soon as we are able to. In the 17 worst case scenario, if we do have another room and we 18 haven't been able to tell, we have it posted on the door 19 across the street of our regular hearing room. It will be 20 someplace in walking distance. 21 Mr. O'Laughlin. 22 MR. O'LAUGHLIN: Mr. Chairman, very briefly. I was 23 going to prepare a witness list for the parties that were in 24 the proceedings as well as the State Board. I will just let 25 everybody know so in preparation passion for next Tuesday, 0756 01 if we do go forward, no matter what the Board decides on 02 this motion, the witnesses on Tuesday for the San Joaquin 03 River Agreement will be the biologist and biologist's 04 testimony that was submitted on June 15th. 05 C.O. CAFFREY: Thank you very much. 06 With that, then, we will adjourn and see you all on 07 Tuesday morning at 9:00. 08 Thank you. 09 (Hearing adjourned at 11:40 a.m.) 10 ---oOo--- 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 0757 01 REPORTER'S CERTIFICATE 02 03 04 STATE OF CALIFORNIA ) 04 ) ss. 05 COUNTY OF SACRAMENTO ) 05 06 06 07 08 I, ESTHER F. WIATRE, certify that I was the 09 official Court Reporter for the proceedings named herein, 10 and that as such reporter, I reported in verbatim shorthand 11 writing those proceedings; 12 That I thereafter caused my shorthand writing to be 13 reduced to typewriting, and the pages numbered 668 through 14 756 herein constitute a complete, true and correct record of 15 the proceedings. 16 17 IN WITNESS WHEREOF, I have subscribed this certificate 18 at Sacramento, California, on this 22nd day of July 1998. 19 20 21 22 22 23 ______________________________ 23 ESTHER F. WIATRE 24 CSR NO. 1564 24 25