    MONDAY, SEPTEMBER 18, 1995, 10:00 A.M.
                   --O0O--
MR. CAFFREY:  Good morning to you all and welcome to 
this installment of the Board's continuing workshops on the 
implementation of its 1995 Bay-Delta Water Quality Control 
Plan.
By way of introduction, to my immediate left is our 
Board Vice Chair, Mary Jane Forster.  Next to Ms. Forster is 
Board Member Marc Del Piero.  To my immediate right is Board 
Member James Stubchaer. Next to Mr. Stubchaer is Board 
Member John Brown.  To my far left at the left end of the 
dais is our Executive Director, Walt Pettit.  At the front 
table we have Tom Howard, Supervising Engineer; Barbara 
Leidigh, Senior Counsel; and Victoria Whitney, Senior 
Engineer.  Jerry Johns is in the front row.
Good morning, Jerry.
Good morning to you all and welcome.  
As is our tradition, our usual process is to read a 
statement into the record.  
This is the time and place for the State Water 
Resources Control Board to hear further comments and 
recommendations regarding development of a water right 
decision to implement requirements for the San Francisco 
Bay/Sacramento-San Joaquin Delta Estuary.
This workshop is being held in accordance with the 
Notice of Workshop dated July 27, 1995.
If you intend to speak today, please fill out a blue 
speaker card and give it to our staff at the front table.
As specified in the Notice of Public Workshop, this 
is the third of four scheduled dates for this workshop.  
By the way, as an aside, we apologize to anybody who 
got caught up in the confusion of when our start time was 
this morning.  We had changed it at our last meeting to ten 
o'clock to try and convenience those who are traveling, and 
we apologize if it caused confusion.  
If we do this in the future, we will come up with a 
written notice.  
We will continue this workshop tomorrow.  Mr. Pettit 
will have something to say about future workshops when I 
finish reading this opening statement.
As is specified in the workshop notice, the Board is 
seeking comments and recommendations on the development of a 
water right decision that:
1.  Identifies the responsibility of water-right 
holders in the Bay-Delta Estuary watershed to achieve 
the requirements in the Bay-Delta Plan adopted by the 
Board in May of 1995 and allocates responsibility 
according to established principles of water law;
2.  May authorize the combined use of the Central 
Valley Project and the State Water Project points of 
diversion in the Delta;
3.  Requires actions to improve habitat conditions in 
the Central Valley; and
4. Requires measures to improve water supply 
reliability for users of water within and from the Bay-Delta 
Estuary watershed.
This workshop is part of the process under the 
California Environmental Quality Act.  Therefore, the 
comments and recommendations received during these workshops 
will be used to develop alternative actions for a water 
right decision and these alternatives will be analyzed in an 
environmental document for the water right decision.
The Board wishes to receive as much input from the 
parties as possible before commencing a formal water right 
hearing.  
The parties also are encouraged to give the Board's 
staff newly developed information at any time.  Any 
information provided to the staff also should be made 
available to the other workshop participants for their 
review and consideration.  The staff can supply a mailing 
list of workshop participants.
The Board is aware that some of the parties are in 
the process of negotiating agreements on implementation of 
the Bay-Delta Plan.  The Board encourages the parties to 
reach agreement and to propose joint recommendations to the 
Board for its consideration.  Consequently, the Board wishes 
to receive information in this workshop on the progress 
being made by some of the parties to achieve negotiated 
agreement.
The Board also wishes to emphasize in this workshop 
issues 7 through 15 in the workshop notice.  We received 
input primarily on issues 1 through 6 at the August 29-30 
workshop.  Therefore, you are encouraged to address issues 7 
through 15, including issues affecting the Sacramento basin 
today and tomorrow.  Nevertheless, I want to point out that 
you will not be precluded from speaking to issues 1 through 
6 today and tomorrow, if you so wish.
With regard to conduct of the workshop, today's 
procedures are described in the Notice of Public Workshop.  
Additional copies of the notice are available from staff.
In this workshop, I will call each party who has 
submitted a card requesting an opportunity to provide oral 
comments and recommendations.  There will be no sworn 
testimony or cross-examination of the parties, but the Board 
members and the staff may ask clarifying questions.
Each speaker will have 20 minutes for an oral 
presentation.  A party may be represented by one or several 
speakers.  If a speaker needs additional time, the speaker 
may request additional time at the beginning of the 
presentation.  Please explain why additional time is 
necessary.
If we are not able to provide you all the time you 
think you need, we encourage you to submit your presentation 
in writing.
In the interest of time, we ask that parties avoid 
repeating details already presented by other parties 
whenever possible, and simply indicate agreement. 
Alternatively, parties with the same interests are welcomed 
and encouraged to make joint presentations.
We will also accept, and we encourage, written 
comments.  You need to provide the Board and its staff 20 
copies of any written comments and recommendations, and make 
copies available to the other parties who are here today.
A court reporter is present and will prepare a 
transcript.  If you want a copy of the transcript, you must 
make arrangements with the court reporter.
We will reconvene tomorrow in the Board's hearing 
room across the street at nine a.m. to make sure that we 
have got everybody covered.  
The way we wrote our notice last time, it did not 
say, if necessary, for the additional days, so we will be 
there in case people do want to appear and speak.
I will call parties in the following order:
1.  Elected officials for the State and Federal 
Governments;
2.  Representatives of State and Federal agencies;
3.  All others in the order that your speaker card 
was submitted to staff, unless you have special time 
constraints which you have noted on your speaker 
card.
I would also point out this did cause us a little bit 
of difficulty last time.  Some people arrived late and were 
then taken eventually in a different grouping than so 
designated.  We recognize that there are times when we have 
to make some adjustments, and please bear with us when we 
have to do that.
Before we begin, I, again, would like to say to the 
parties that the Board encourages you throughout the 
duration of this proceeding to work together to identify and 
develop areas of agreement.  The Board is interested in 
having this kind of information as it hears facts and 
opinions regarding the very complex subject of achieving the 
standards set for the Bay-Delta Estuary.
We hope that all the parties will use these 
proceedings as an opportunity to help the Board develop a 
water right decision that will achieve workable methods of 
allocating the responsibility to meet the Bay-Delta 
standards, rather than using the workshop solely to assert 
positions of advocacy.
That completes the statement.
Do any of the Board members wish to add any comments 
at this time?  Nothing at this time.
Then, I think we will look to Mr. Pettit and identify 
some discussion the other day about his giving us an update 
and some of his best thinking on what we might do after 
these proceedings.
MR. PETTIT:  Thank you, Mr. Chairman. 
If it's got to be my best thinking, I guess I better 
be careful.  I thought I would like to make a few comments 
at the outset from the staff's perspective as to where we 
have been and where we are heading with this process so the 
parties, if they wish to comment on any of our plans during 
the day or give us any suggestions or redirection, and that 
the Board, if they see any differences between where we see 
we are headed and where they want us to head, and hopefully 
make that clear as we progress.
I would like to, first, talk about the follow-up to 
the previous workshop, the workshop we had in August.
We received 28 written comments at that workshop and 
the staff has prepared a list of the parties who submitted 
comments.  That list is available at the back of the room 
for anyone who is interested.
We also received recommendations with regard to 
holding several other workshops on specific topics or 
specific issues.  The one that I think that has some 
direction so far to proceed with is a workshop on the 
question of barriers in the Delta, particularly the Old 
River barrier.  
At the moment, as far as we are aware, that's the 
only one that there has been definite instruction to proceed 
with.  So, if anybody has any comments on that, we would 
appreciate hearing them.
With regard to other follow-up, the staff will be 
prepared to put together and eventually publish a list of 
alternatives that should be considered in the Environmental 
Impact Report.  We anticipate putting that package together.  
We are soliciting comments and anyone else's ideas as to 
what alternatives should be considered.
To the extent you can give us your proposals for 
water allocation and mechanisms that should be used to 
implement any recommended water allocation process, we would 
like to see those as soon as possible.  In anything you 
submit, it would be very helpful if you could be as specific 
as you can with regard to the impacts of a particular 
proposal both on your own interests and the interests of 
others.
We targeted October 15 as the time we would like to 
have something put together to consider distributing, so if 
you would keep that date in mind.  Obviously, it's not going 
to be the final date for discussion, but it would be helpful 
to have anything you wish to submit by that time.
I would like to next speak to the Notice of 
Preparation for the Environmental Impact Report.  We 
received, I think it was somewhat over a dozen comments on 
that Notice of Preparation, including some suggestions for 
revision and some requests that the time to comment on it be 
extended past the date of this workshop.
We also think that the project description ought to 
be refined as a result of the days of workshop we have 
already had and possibly as a result of today's workshop, so 
we are recommending that that Notice of Preparation be 
revised and republished for further comments.
However, we would still appreciate any ideas that you 
have in the interim before we republish the notice either on 
the last one or suggestions as to what should be included in 
the second one.
With that, unless there's any questions, I think 
that's all I have to say at the moment, Mr. Chairman.
MR. CAFFREY:  Thank you, Mr. Pettit.  
I think it would be important to mention that we on 
the Board need to hear from all of you who have submitted 
blue cards as to any thoughts you have on the process that 
Mr. Pettit has just lined out for us, so to speak, because 
barring any objection or suggested refinement from those of 
you in the audience or my fellow Board members, that will 
probably be the way we will proceed and follow up with 
notices on, so I asked Mr. Pettit to give us that 
information at the very outset so you all have a little bit 
better understanding of what we are going to be doing 
between now and at least the beginning of the calendar year.
It sounds like it will be workshops, but if you do 
have thoughts, we really do need to hear them, so please 
critique, applaud or whatever way you want to describe your 
feelings on what you just heard.
With that then, before we go to the cards, let me 
read the ones I have and this will give you an idea of the 
order in which we are going to take them barring any kind of 
emergency.
The first is the Club FED presentation and you all 
know who you are and we have Greg Zlotnick of the Department 
of Fish and Game, David Anderson with the Department of 
Water Resources, Morris Allen of the City of Stockton, a 
group led by Jim Chatigny representing the upstream users, 
and then Michael Jackson of Cal SPA, Arthur Godwin, Robert 
Meacher, Robert Helwick, Gary Bobker, Joe Robinson; and we 
have a group of Joint California Water Users, Kevin Haroff, 
Cliff Schulz, James Roberts, Tom Berliner, and probably some 
others and we will hear from them.
And then, let's see, we have also Richard Denton and 
Kevin O'Brien, and I have been given another card of Richard 
Moss.
All right, that will be the order.
Let's begin with the Club FED presentation, 
gentlemen.
Chet Bowling, I think, is leading the delegation. 
Good morning, gentlemen, and welcome.
MR. BOWLING:  Good morning.  I am Chet Bowling, Chief 
of the Water Operations in the Central Valley Operations 
Office of the Bureau of Reclamation.  I am speaking for the 
Federal Ecosystem Directorate, or Club FED.
Club FED was established to provide a coordinated 
federal effort on issues associated with the Delta and other 
water issues in California.  
With me today are Joel Medlin of the Fish and 
Wildlife Service and Bruce Herbolt of the Environmental 
Protection Agency.  The National Marine Fisheries Service 
was unable to have a representative here today.
My statement summarizes a more detailed written 
response of which you have a copy.  We have addressed the 
issues concerning the Sacramento River and the overall Bay-
Delta watershed.  
The first six issues concerning the San Joaquin River 
basin and issue 15 were addressed at the first workshop.
The following are our responses to key issues 7 
through 14.
On issue 7, Club FED believes that additional actions 
will be necessary throughout the Bay-Delta watershed to 
implement the goal of doubling natural production of chinook 
salmon.  The Fish and Wildlife Service has recently 
prepared, with the assistance of experts from a variety of 
agencies, a technical working document that describes 
several hundred specific actions that may be necessary to 
double anadromous fish production, including chinook salmon, 
in the Central Valley.
The Service is further considering those actions that 
are deemed reasonable for inclusion in the anadromous fish 
Restoration Plan, which will be released in draft in October 
or November of 1995 and finalized in early 1996.
Actions that are likely to be identified as 
reasonable under this program will probably fall into the 
following broad categories:
1.  Restore and replenish spawning gravel below dams;
2.  Improve flow regimes on some Central Valley 
rivers to better support spawning, rearing and 
migration of chinook salmon;
3.  Improve conditions in the Delta to support 
upstream migrating adults and downstream migrating 
salmon smolts, especially in the late fall and early 
winter for spring-run chinook.
4.  Restore riparian habitat to improve instream 
water temperatures and to provide cover and feeding 
habitat for chinook fry;
5.  Screen unscreened or inadequately screened 
diversions in the Delta and along Central Valley 
rivers and streams that now take chinook salmon; and
6.  Improve passage at existing obstacles to salmon 
migration.
In issue 8, Club FED believes that all water rights 
in the Bay-Delta watershed need to be considered for 
responsibility under this water right decision.  This issue 
is similar to the question under issue 2 that was addressed 
at the first workshop.  
In brief, our response to that question was:  
The process must be consistent with California 
water law and the principles of Western water 
law.  The process must be fair and equitable to 
all concerned and particularly to all water-
right holders, including the Central Valley 
Project and the State Water Project.
Our response is the same except that water rights on 
the entire watershed need to be considered.  The State Board 
may ultimately determine that the decision will only cover 
certain rights as suggested in the notice.  However, the 
process should address both legally and technically why 
particular criteria may be adopted.
On issue 9, this question raises many significant 
issues, legal as well as environmental and economic.  We 
feel the State Board needs to develop parallel but separate 
analytical techniques for determining economic and 
environmental impacts of its water right decision, and we 
refer you to our written response to this question but would 
briefly mention that the State Board may find the 
environmental review process that Reclamation has under way 
for the implementation of the CVPIA to be relevant to this 
issue.
On issue 10, as stated before, Club FED has suggested 
that an analytical process be undertaken.  In the spirit of 
developing a constructive dialogue that will lead to a fair 
and equitable implementation process, we make the following 
three suggestions:
1.  Base the process on term 91 methodology, which 
could be expanded to examine other priorities of 
right;
2.  Undertake analyses similar to 1956 cooperative 
studies to determine deficiencies in the water 
rights;
3.  You could allocate responsibility based on 
historic water use or the D-1630 method.
And please note that these suggested processes may 
not necessarily meet some of the criteria Club FED has 
stated should be followed, such as following water right 
seniority in the State Board's process.
However, as mentioned above, we make these 
suggestions in the spirit of developing a constructive 
dialogue that will lead to a fair and equitable 
implementation process.
On issue 11, Club FED believes that combined use of 
Central Valley Project and State Water Project points of 
diversion has a number of benefits to the projects' 
operations.  These include providing for increased 
efficiency and reliability and environmental benefits.
The State Board should approve the joint point of 
diversion after appropriate terms and conditions are 
developed.
We would note that use of the combined points of 
diversion per se does not have environmental impacts.  It is 
the conditions under which such use is made that are of 
concern.  Our written statement covers items that the State 
Board needs to consider in evaluating the joint points of 
diversion.
On issue 12, for the State Board's analysis, the no-
action alternative should be operations under D-1485, the 
1995 Biological Opinions for Delta smelt and winter-run 
salmon, and the Central Valley Project Improvement Act.
On issue 13, the State Board should include actions 
described in Decision 1630 to encourage conservation of 
water and domestic and agricultural use.  This should 
include incentives for installing water conservation 
equipment.
The State Board should also include all elements of 
the Bay-Delta Plan that were included within the Service's 
March 6, 1995, Biological Opinion.  These are covered in our 
written statement.
On issue 14, the monitoring programs currently in 
place and supported by the Interagency Ecological Program, 
IEP, should be adequate to provide information on the 
results of implementing Bay-Delta standards on fisheries 
resources.  IEP is currently internally reviewing monitoring 
programs to meet the changing needs of agencies.
It would be appropriate to use this review process as 
a framework for monitoring the success of State Board 
actions.  Additional, but as yet unidentified, monitoring 
will be conducted to assess the effectiveness of fish and 
wildlife restoration activities under this CVPIA.
And this concludes our statement.
MR. CAFFREY:  Thank you, Mr. Bowling.  You are doing 
the statement exclusively and the other gentlemen are here 
for questions?
MR. BOWLING:  For questions, yes.
MR. CAFFREY:  Thank you, gentlemen.  We appreciate 
your being here.
Are there questions from Board members?
Mr. Stubchaer.
MR. STUBCHAER:  Under item 7, on chinook salmon, I 
was wondering how one determines whether a salmon is 
hatchery bred or naturally bred in meeting the goal of 
naturally-produced salmon.
MR. MEDLIN:  There's mechanisms to mark hatchery-
produced salmon, tag them or put some invisible tags on 
their fins, that sort of thing; and through monitoring and 
through evaluation of the releases from the hatcheries and 
those tags, there can be some judgment made on which are 
hatchery produced and which are naturally produced.
MR. STUBCHAER:  Would all hatchery salmon be tagged 
or would it be a statistical process?
MR. MEDLIN:  Not all of them actually are tagged all 
the time.  It is possible to do it, but it is obviously a 
costly process.  There's costs with that and you may be able 
to tag a portion of them, and through monitoring be able to 
determine, you know, relatively what's going on.
MR. STUBCHAER:  Then, one other thing.  I would note 
there's no D-1630 which you referred to.  There were a 
couple of drafts of 1630, a December draft and a March or 
April draft, and I am wondering which draft you are 
referring to.
MR. BOWLING:  I believe it was the final draft.
MR. STUBCHAER:  Thank you.
MR. CAFFREY:  Mr. Del Piero and then Mr. Brown.
MR. DEL PIERO:  The report that is being done, you 
indicated is going to be out the end of October or the first 
of November.  Is that going to be drafted in such a fashion 
that this Board can consider those as potential components 
of the terms for the water rights plan.  Will they have the 
degree of specificity that we would use for reference?
MR. MEDLIN:  Are you referring to the anadromous 
fishery draft?
MR. DEL PIERO:  Yes. 
MR. MEDLIN:  There will be a draft document.  It 
won't be final until early next year.
MR. DEL PIERO:  I understand the designation.  I am 
asking whether the document will be written in such a 
fashion that this Board would be able to extract from it 
specific language as to how to address the objective of the 
doubling requirement.
MR. MEDLIN:  I think you could probably ascertain 
some of that.  I am not going to promise it will be so 
specific that you could just pull out the individual 
language and match, you know, what you are talking about 
there.  There will be progress made, though, in that 
document.
MR. DEL PIERO:  That is the intention of Club FED, to 
glean from that document standards and offer to this Board 
in terms of comments, language specific enough to 
incorporate into terms?
MR. MEDLIN:  I guess I am not really prepared or 
knowledgeable enough to be able to answer specifically 
whether we are going back and redraft it or revise any of 
the language in it at that time.  I think that, like I    
say --
MR. DEL PIERO:  Maybe I am not being clear.  I am not 
asking whether or not you are going to redraft it for our 
benefit.  I'm asking whether or not after the draft has been 
issued, a specific recommendation that might be generally 
incorporated into the draft will be submitted to this Board 
for implementation as a term in the water rights order.
MR. MEDLIN:  I am not sure Club FED will go back and 
do that, but I am sure the document will be useful.  So, 
what we can all glean from that and provide in the way of 
recommendations or, you know, whatever, we would be willing 
to work with you.
MR. DEL PIERO:  The reason I am asking the question 
is because if the language is written, and sometimes 
documents like that are, in broad generalities, broad 
generalities could mean a lot of things to a lot of people 
and without specific language, I wouldn't want to have the 
problem of interpretation.  That's why I am suggesting it 
might be appropriate for you to at least think about it.
MR. MEDLIN:  Okay, I understand and I am not trying 
to evade the question.  I believe that the document is being 
written in a very specific manner.  In other words, specific 
recommendations will be made and the question is whether 
Club FED will go back and review that or do something more.  
I don't know and I don't want to speak for Club FED as a 
whole for that purpose.
MR. CAFFREY:  Mr. Brown.
MR. BROWN:  Thank you, Mr. Chairman.
On question 12, the no-action alternative, you are 
suggesting it should be under the operation of D-1485 and 
then the Central Valley Project Improvement Act.  The CVPIA 
has, of course, a no-action alternative itself.  Then, it 
has, I believe, maybe five or six action alternatives.
Are you suggesting that we would use the CVPIA no 
action or wait until an action is implemented through the 
CVPIA and use that then as our no action?
MR. BOWLING:  I believe we are looking at the latter, 
that it would be actions developed under the CVPIA. 
MR. BROWN:  There would be a selected action under 
CVPIA?  That's still about a year and a half away from 
completion?
MR. BOWLING:  I will ask myself.  I am not sure when 
that will be final.
MR. BROWN:  If it was a year or year and a half away, 
would that mean that you suggest we would wait that time 
until your conclusion arrived at an option?
MR. BOWLING:  No, I don't believe you would have to 
wait that long.  We would have to provide as much 
information as we could as to actions that we see taking 
place under the CVPIA. 
MR. BROWN:  Staff, do you  have an idea when the 
conclusion of the CVPIA would be?
MR. HOWARD:  Your estimate of about a year and a 
half, I think would be an optimistic estimate.
MR. DEL PIERO:  If it doesn't get modified by the 
Congress.
MR. BROWN:  How can you interpret what that may or 
may not be?
MR. HOWARD:  You wouldn't be able to.
MR. CAFFREY:  You can't.
MR. BROWN:  So, our no-action alternative --
MR. CAFFREY:  Well, it's not our no-action 
alternative.  It's what's being suggested by these 
witnesses.
MR. BROWN:  In our Environmental Impact Report.
MR. CAFFREY:  This is their suggested answer to this 
one question.
MR. BROWN:  Right.
MR. CAFFREY:  How they would identify and define a 
no-action alternative.
MR. BROWN:  But it is a year and a half away.
MR. CAFFREY:  That aspect of it could be, yes.
MR. BROWN:  Okay.
MR. DEL PIERO:  Mr. Chairman, I have been going 
through the comments of a number of people, fisheries 
agencies, water agencies, a number of people who are asking 
us to consider CVPIA standards and the provisions of that 
act in our water rights order, and I know all four Board 
members are aware of that and there may well be significant 
changes in that act next year in terms of Congress.
So, it does not bode well if we are to predicate 
standards like that on a bill that everyone agrees has 
things that have substantive changes made to it.
And an environmental document like that virtually 
guarantees a challenge if we do that.
MR. BROWN:  Well, the question being, how are you 
physically going to it?
MR. DEL PIERO:  That's why we are holding the 
hearings.  I am looking forward to hearing some intelligent 
discussion on how we are going to do it given the facts we 
are presented with. 
MR. BROWN:  Thank you.
MR. CAFFREY:  Any other answer from Board members?  
Anything from staff?
All right, thank you very much, gentlemen, for your 
appearance.  We appreciate your input.
That will take us to the State Department of Fish and 
Game, Greg Zlotnick. 
Good morning, sir, welcome.
MR. ZLOTNICK:  Good morning, Mr. Chairman and members 
of the Board.
I am Greg Zlotnick, Special Assistant for Water 
Resources in the office of the Director of the Department of 
Fish and Game.
I thank you for the opportunity to address you this 
morning so that I may show the Department's perspective 
regarding questions 7 through 15 of your workshop notice.  
I am presenting this morning an abridged version of 
our written submission, which includes more detail.  Key 
members of the Department staff are in the audience and will 
be able to answer specific questions you might have 
regarding details relating to my presentation.
Question 7 asked whether there are additional actions 
that are necessary to implement the Water Quality Control 
Plan's salmon requirement.  
The Department believes there are additional actions 
that could be taken by the Board in the Bay-Delta watershed 
to facilitate achieving the State and Federal salmon 
restoration goals.  For example, we support and would like 
the Board to consider including specific water temperature 
objectives in each Central Valley basin Water Quality 
Control Plan to protect salmon spawning and egg incubation. 
Specifically, we refer the Board to those water 
courses designated in Fish and Game Code Section 1505.
We also support the development and implementation of 
flow fluctuation criteria for major Central Valley rivers to 
reduce mortality of eggs during incubation and losses of 
juvenile fish during rearing.
Flow, water temperature and flow fluctuation problems 
in some Central Valley rivers may be appropriately addressed 
through reservoir operations consistent with flood control 
requirements.  
The Corps of Engineers is currently re-examining its 
flood management criteria in the San Joaquin basin and the 
Corps' findings will no doubt have relevance to your 
process. 
We are confident operational requirements may be able 
to be modified without impairing flood management 
capability, substantially improving river habitat conditions 
without additional water costs, thus partially relieving 
demand pressures on the State's water supply system.
Another action the Department recommends is that the 
Board consider appropriate changes in relevant water rights 
held by the Bureau of Reclamation for the Central Valley 
Project to insure that expected increases in natural 
production of anadromous fish under the CVPIA will be 
sustainable on a long-term basis.  We would like to work 
with the Board in identifying such modifications.
Finally, information regarding numerous specific 
actions the Department supports are described in two recent 
Fish and Game reports we have submitted for the record: 
First, Restoring Central Valley Streams, a Plan for 
Action, 1993;
And second, a follow-up supplemental report Restoring 
Central Valley Streams:  a Plan for Action, Status of 
Implementation, 1995.
Copies of these reports can be obtained upon request 
from the Department's Inland Fisheries Division, and we have 
submitted them to your staff as required.
With respect to what water rights should be subject 
to your upcoming hearing process, the Department concurs 
with the Board's focus on parties with diversions greater 
than three cfs or storage greater than 200 acre-feet.  We 
recommend, however, that the Board include other water-right 
holders who may not technically be in the Central Valley, 
but who do impact the Bay-Delta watershed.  Water-right 
holders west of the Delta in the watershed of the Suisun 
Marsh should be included in the Board's deliberations when 
it assesses obligations for meeting standards in the 
Northwestern Marsh.
As to potentially significant environmental and 
economic effects resulting from alternative allocation 
methodologies, we are deferring our detailed input at this 
time as it will be included in our written response to your 
Notice of Preparation of an Environmental Impact Report.
If the Board relies on DWRSIM for the statewide water 
project operations model, it will be important to insure 
that upstream operations of the Central Valley Project and 
other non-State water project facilities are depicted as 
accurately and in as much detail as possible.
We look forward to the Bay-Delta modeling forum 
session later this week on the topic of statewide reservoir 
operations models as an opportunity to learn more about 
advances in modeling capability and to discuss future model 
needs.  We welcome Board staff involvement in its effort and 
support the Board's continuing interest.
Finally, your economic analysis needs to include not 
only effects related to agricultural, municipal and 
industrial uses, but also should include the economic 
activity directly and indirectly resulting from increased 
and sustained production of anadromous fish stocks; that is, 
the value of an impact to recreational and commercial 
fisheries and the many activities ancillary to them.
With regard to the methodology to allocate 
responsibility for meeting water quality and flow standards 
in the Sacramento River, the Delta and Suisun Marsh, we 
refer you to the comments we provided at your August 
workshop with respect to the standards on San Joaquin River 
at Vernalis.
In summary, we encourage the Board to look beyond the 
Bureau of Reclamation and the Department of Water Resources 
for contributions to meeting the Sacramento River, Delta and 
Suisun Marsh standards.
We recognize that equitable allotment of such 
obligations would be extremely difficult in a vacuum, let 
alone in the present context that include significant, 
legitimate and formidable water right priority issues under 
California water law.
Nevertheless, the Department believes your authority 
under the public trust doctrine and Article II, Section 10 
provides sufficient latitude for a more broadly based vision 
in implementing your Water Quality Control Plan.
Although we agree that evaluation and augmentation of 
flow requirements below the lowest dams presents a good 
starting point, it should be considered only that, a 
starting point.  Diverters upstream of these dams should be 
considered also, because upstream operations influence 
downstream conditions.
With respect to a Term 91 type methodology as a 
possibility, it is something the Department believes 
probably merits further investigation as one component of an 
overall, comprehensive strategy.
We reiterate our previous input into water right 
Order 95-6 with regard to permanently modifying the Central 
Valley Project and the State Water Project water rights to 
allow for use of joint points subdiversion.  
We would like to clarify our view that while fishery 
benefits are possible as a result of the increase in 
managerial adaptability afforded by the use of the joint 
point, perceived opportunities to reduce predation and 
entrainment losses may not result in significant net 
benefits.
In our previous testimony we expressed our support of 
the use of the joint point as a means to increase 
operational flexibility to hopefully benefit fisheries, but 
not to accomplish a net increase in annual water exports.  
We reiterate that today, with the provision that if 
conditions in the Delta are demonstrably improved and fish 
populations dependent upon the Delta increase in abundance 
by virtue of the entire array of measures that may be 
implemented in the Delta and upstream, then we would 
consider allowances for seasonally increased Delta exports.
It is still our expectation that such deliberations 
regarding the timing and magnitude of potential increased 
diversions would take place within the Ops Group.
The Board has solicited recommendations on the so-
called no-action alternative and has suggested several 
possibilities.  
Because there are material differences between CEQA 
and NEPA, the Board should clarify if it intends to pursue a 
no-project alternative analysis per CEQA or the Board plans 
to prepare an EIR/EIS and a NEPA no-action alternative.
If a NEPA review is pursued, we suggest the Board 
review the work of the CVPIA Programmatic Environmental 
Impact Statement Team in defining a no-action alternative.
One significant aspect of the no-action feature that 
emerged from the CVPIA PEIS work was the substantial 
increase in diversions anticipated pursuant to existing but 
currently underutilized water rights.
If the project's purpose is to develop a new water 
right decision with a more widespread distribution of 
responsibility for implementing the 1995 Water Quality 
Control Plan among a large set of water-right holders in the 
watershed, including the Department of Water Resources and 
the U. S. Bureau of Reclamation, the no project or no-action 
alternative could be implementation of the 1995 Water 
Quality Control Plan with compliance achieved solely by the 
U. S. Bureau of Reclamation and the Department of Water 
Resources, as is currently the case.
Another possible no-project alternative is the pre-
1995 Water Quality Control Plan situation where D-1485 was 
combined with the various Biological Opinions.  
As to future conditions, we believe the CVPIA is an 
appropriate component of such an analysis with or without 
Board action and implementation of Delta requirements.  We 
encourage the Board, as it prepares its environmental 
document, to closely monitor CVPIA implementation.
As to specific actions to improve habitat conditions 
in the Bay-Delta watershed, we consider this issue as 
primarily an extension of key issue 7 on additional actions 
to benefit salmon.  We urge the Board to look to ongoing 
projects and studies for additional specific actions that 
may be beneficial to other anadromous and resident species 
dependent upon the estuary.
The Department believes that there are some actions 
that the Board should consider taking now within the 
boundaries established by the 1995 Water Quality Control 
Plan to improve habitat in the estuary's watershed and make 
additional interim progress toward restoring the estuary 
while the long-term Cal-Fed Bay-Delta program and Category 3 
efforts proceed.
We would like to work with the Board and its staff in 
formulating measures consistent with the 1995 Water Quality 
Control Plan that could serve to amplify the benefits we all 
hope to achieve in the Delta during this interim period.
The Board should also consider appropriate and 
reasonable restoration actions described in the CVPIA 
working paper on restoration needs.  Moreover, contaminant 
issues in the estuary and its water rights should also be 
considered when crafting potential actions to improve 
habitat conditions.
In response to your inquiry regarding monitoring, the 
Interagency Ecology Program is currently involved in a 
significant new effort to define a comprehensive program of 
monitoring, special study, and research elements to provide 
the information needed for effective management and 
protection of the estuary.
The Board should seek to insure that adequate 
financial resources are available for Bay-Delta monitoring, 
including the IEP.
It is vitally important that the monitoring, special 
study and research efforts associated with the Board's 
decisions and permits be the result of a thoughtful, 
objective and broad-based process.  We believe the IEP is 
the logical place for that process to occur.
We urge the Board to make it clear as well that real-
time monitoring would be a supplementary contributor to, not 
a replacement for, continuation of our collective long-term 
database.
While the emphasis has been on monitoring within the 
Delta, it is important to note that there are many 
monitoring activities taking place upstream which are 
providing significant additional information and enhancing 
our understanding of the watershed and its fishery 
resources.  Such activities in the tributary and mainstem 
rivers will continue to be important and their findings need 
to be integrated with in-Delta monitoring results as part of 
a comprehensive ecosystem management strategy.
Finally, you have requested suggestions regarding the 
use of work groups.  We would refer you to our testimony 
last month when we outlined three different areas that we 
felt work groups would be appropriate, and also, would 
encourage the Board to solicit updates concerning the 
progress of the Suisun Ecological Work Group's 
deliberations.
And with that, our comments are concluded.
MR. CAFFREY:  Thank you very much, Mr. Zlotnick.
Are there questions from Board members?
Anything from staff?
Mr. Howard.
MR. HOWARD:  On page 3 of your comments you indicate 
that you are recommending numerous specific actions that the 
Board undertake in this proceeding and you refer the Board 
to your June, 1995, publication called Restoring Central 
Valley Streams:  A Plan for Action.
I sort of skipped through it and I see hundreds of 
actions.  Does the Department really recommend that all of 
these be incorporated into the water right process at this 
point, or are they going to provide more specificity as to 
specific actions?
MR. ZLOTNICK:  We interpreted that you asked for 
additional actions and we support all of those actions, not 
necessarily that you need to put them into your plan, but we 
believe you can pick and choose as you see fit.
As we said, the Department supports all the actions 
that are in there as potentially effective.
MR. HOWARD:  Is there any way the Department would 
perhaps pick a few that might be most appropriate in this 
proceeding?
MR. DEL PIERO:  Mr. Howard is looking for a summary 
with specificity.
MR. ZLOTNICK:  Fine, we can certainly work on that 
with the Board.
MR. DEL PIERO:  It might be appropriate to 
incorporate into a water right.
MR. ZLOTNICK:  Sure.  We just gave you a shopping 
list.
MR. HOWARD:  Thank you.
MR. CAFFREY:  Anything else from the staff?
MR. HOWARD:  No.
MR. CAFFREY:  Thank you, sir.  Thank you for being 
here.
Next is David Anderson representing the Department of 
Water Resources.
MR. ANDERSON:  Good morning, Mr. Chairman and members 
of the Board.
My name is David Anderson with the California 
Department of Water Resources. 
The Department today is responding to issues 7 
through 15 as was suggested in the Board's notice.
Issue 7, I think, has pretty much been answered by 
the Club FED group.  
To summarize, we think that the CVPIA doubling plan 
is one from which the Board should take its direction.  We 
also note in our comments that there are other programs 
under way directed to taking action in the watershed that 
would be of assistance to achieving the doubling objective, 
namely, the Category 3 activities that are described in the 
Principles for Agreement.
There's the four pumps program that we have had 
numerous occasions to describe before this Board which are 
the programs that are under way by both the Department of 
Water Resources and the U. S. Bureau of Reclamation, 
agreements to offset direct impacts of the pumping plants 
that go to the benefit of chinook salmon. 
Finally, there's the other activities under the CVPIA 
restoration program.  Many of those activities ought to be 
of benefit to achieving this doubling goal.
We don't believe that the Board should take specific 
action at this time to determine the appropriate role of 
water quality regulation in the Delta to meet the narrative 
objective, but should wait until the CVPIA doubling plan is 
complete, and at that time, the Board may review the plan 
and determine what additional actions may be required and 
practical for the Board to implement.
On issue 8, which water rights in the Bay-Delta 
watershed should be subject to this water rights decision -- 
kind of a mixed answer.  We think a lot of folks have been 
on what water rights ought to be subject to this water 
rights proceeding, and I think our view is that almost all 
the water rights in the watershed should be made subject to 
this proceeding.  We think there are two considerations 
here.  The first is the consideration that all water users 
in the watershed should share towards the achievement of the 
public interest requirements in the Delta and the estuary, 
and at the same time, we recognize that there's some very 
practical considerations that we think ought to limit the 
number of water rights that are taken up for an immediate or 
near-term modification.
So that, what we think ought to occur is that the 
Board should probably stage its decision making under the 
umbrella of a single proceeding.  We think the Board should 
notify all users of water in the watershed and in that 
notice indicate that the Board would intend to proceed by 
taking up individual or a small group of water rights at a 
time for decision, so that at any given moment there would 
be a discrete and small number of water rights on the table.
And then, the Board would proceed to consider those 
in the sequence identified by the Board and that the Board 
would issue a decision and enter an order, and then proceed 
to the next group.  And in the fullness of time, all the 
water users in the watershed would come under the Board's 
active scrutiny.
We think this is a practical way.  You notify four or 
five thousand users in the watershed and hold a hearing on 
them all at one time, I don't think that is going to lead to 
a very practical type of water rights proceeding.
What we want to do is take the actions that would 
actually be effective, and we have identified three criteria 
here; that's the question of equity, the benefit to the 
estuary and public interest in terms of which water rights 
the Board should consider.  And this, obviously, is the 
central question.
We think looking at those criteria, the largest users 
of Delta water supplies are the ones that suggest themselves 
for immediate treatment, and of course, the State Water 
Project and the Central Valley Project are the largest users 
of Delta water supplies, but we might ask somewhat 
rhetorically whether the immediate consideration of only the 
projects' water rights alone really make any significant 
difference in implementing the Bay-Delta objectives in the 
very near term since the projects are already operating to 
meet those objectives today.
So, what we propose, rather, is that the Board's 
energy would be more effectively directed to considering, at 
the same time, the water rights of the next largest group of 
users.  Now, I don't know whether that's five, seven, or 
eight or ten, or two.  That's something that the Board and 
we all need to consider is the practical-sized group.  And 
we think this ought to be done because this next largest 
group would currently be under no obligation to provide for 
Delta water or public-interest protection in the Delta.
And as I said, we are not offering any specific 
advice at this time on how many water users should be in 
that first group, but to indicate it should be small in 
order to be manageable and practical.
Again, we don't have any specific recommendation on 
what the succession of groups ought to be either.  This is 
simply a process we recommend to the Board.
Issue 9 asks what are the potentially significant 
environmental and economic effects of alternative allocation 
methodologies.  This seemed to go very much to the heart of 
what this EIR is going to be about.  Certainly, the 
different methodologies that the Board may be investigating 
will have significant economic and ecological implications 
in the area of use and go to the fundamental issues of 
reasonableness, balancing, and priorities under California 
water rights law.
We are not prepared at this point to really give you 
any specific information on that, but I do imagine that's 
really going to be the heart of what this Environmental 
Impact Report process is going to be about.
Issue 10, what method should be used to allocate 
responsibility to meet water quality and flow requirements 
in the Sacramento River, Delta and Suisun Marsh to upstream 
water users?
We have developed a bit of an answer here.  One thing 
I would like to add to this answer, though, is the Board has 
suggested Term 91 model as a possible way of proceeding, and 
I noted that the Federal agencies thought that Term 91 and 
the 1956 Cooperative Study, and other things ought to be 
looked into.  We agree with that.  Those are things that 
should be done and investigated.
We think that the Term 91 is something that ought to 
be reviewed in any case in this proceeding since there are 
many other regulators now in the Delta, and that the water 
users that are currently subject to Term 91 are only 
responsible for those instream requirements that are imposed 
by the Board and not by other agencies of government.  So, 
we think it's appropriate under any circumstances to 
undertake during this proceeding and a review of the 
existing Term 91 permit requirements.
In general, issue No. 10, I think, as has been noted 
before, is pretty much the same as the answers to key issue 
2, which we discussed last month with respect to the San 
Joaquin River.
 We appreciate the fact there's a lot of disagreement 
over what the appropriate methodology may be and what its 
legal underpinnings may be. 
We note that there are some key Attorney General 
opinions that bear upon some of these issues and we also 
note there are some judicial pronouncements that even if 
they are largely undeveloped, are fairly sweeping in their 
implications with respect to the California water right 
priority system.
We would also point out that the legal issue is 
complicated by the nature of some of the objectives that we 
are dealing with.  I gave you a couple of examples.
The first one is the X2, and while we might want to 
look at the depleters in the system and form an allocation 
based on the impacts of those depletion's, I think we have 
to recognize X2 is more than a depletion standard.  It is a 
catch-all remedy for a host of ills which include unscreened 
diversions and maybe even toxic discharges, and these are 
things for which you simply cannot look to diminution of 
flow, but to those actual underlying problems of, say, 
unscreened diversions to seek a share of responsibility.
Another one I put in here just for discussion 
purposes because it's one that may not be so obvious, is the 
standards which are derived largely from the ESA Biological 
Opinions for the project, and the one I picked was even the 
ones that go to research on project exports.  Even for 
those, we cannot automatically say those are strictly 
project responsibilities.
The Biological Opinions and the reasonable and 
prudent alternatives which are the regulatory mechanisms in 
the opinions were developed to avoid jeopardy to species, 
not just from project operations but from the accumulative 
effect of project operations and all other State, local and 
private activities not foreseeably subject to Section 7 
consultation and Federal actions.
So, what this means is that the biological baseline 
against which project impacts are determined and the impact 
assessment itself account for, and in that sense mitigate, 
the activities of other water users and dischargers.
The level of export limits imposed on the projects 
under the ESA almost certainly, therefore, reflect impacts 
caused by others.
MR. DEL PIERO:  Is that expressed somewhere or is 
that a conclusion?
MR. ANDERSON:  It's in the Biological Opinions 
themselves and the services are required to take into 
account any development of their reasonable and prudent 
alternatives in the computation of their cumulative impacts.
MR. DEL PIERO:  But in terms of the standards you 
indicated that it's obvious, and I couldn't tell whether or 
not that is an expressed statement or a conclusion.
MR. ANDERSON:  It is not express -- perhaps I don't 
understand the question.  The Biological Opinions do not 
expressly say, we are imposing this export standard on the 
project because of all these various effects.
MR. DEL PIERO:  Okay.  I have never seen that before.  
I was wondering if I was missing something.
MR. ANDERSON:  Each of the Biological Opinions does 
contain a section on cumulative impacts which describes the 
nature of the consultation and how the Biological Opinion 
was derived.
And I will just finish that point to say to the 
degree that the limits in the Biological Opinion are now 
embodied in some fashion in the water quality objectives, 
the Board must allocate to the other diverters their share 
of the responsibility even for things which might at first 
blush seem to be exclusively project responsibilities.
I am talking about some of the difficult and 
complexities of any allocation scheme that you come up with 
because it is, frankly, difficult to say with any amount of 
accuracy today what the results of an appropriate allocation 
will be, even if we can  decide upon  that methodology 
today.
Our view is that both the Board and the Corps should 
be guided by what is fair and reasonable in addressing these 
factual and legal complexities, and as many have noted in 
these workshops, it is in great part the risks that are 
inherent in that complexity that counsel water-right holders 
to use their best efforts to reach agreement among 
themselves to bring certainty and reliability to the water 
rights.
Issue 11:  Should the Board approve combined use of 
the CVP and SWP points of diversion in the Delta, and what 
conditions should be placed on such approval?
That's a measure, I think, which is largely in there 
at the request of the two projects and, of course, we think 
they should.  For purposes of scoping this EIR and scoping 
the water right hearings, we would like the Board to take a 
look at and consider the maximum extent that such combined 
use might go in terms of the kind of alternatives you would 
be looking at.  Obviously, you would be looking at other 
alternatives than maximum use.
We appreciate the fact when the issue was brought up 
last April in the D-1485 modification hearings, there was a 
lot of confusion about what was being asked for because we 
were, frankly, at the point of the hearing trying to ask for 
something which was more modest.  
But, in any case, we think for the purposes of this 
hearing, let's take a look at everything that might be done 
under the combined use.  That is, frankly, our view, that 
there's a great deal of room for both environmental 
improvement, water improvement and water supply reliability, 
like conferring as much pumping flexibility upon the 
projects as is possible.
We realize, too, that there are many groups that need 
to be talked to and things worked out, not only with respect 
to the local impacts we have heard a lot about in the April 
hearings, but also, with respect to these larger issues of 
consensus decision making.  We will certainly be consulting 
with the Cal-Fed Ops process and other agencies that are 
parties to the ongoing consensus effort.
Issue 12:  What is the no-action alternative?
Mr. Del Piero and Mr. Brown both raised questions 
about what the no-action alternative is, and I think that 
our answer is that there is no single no-action alternative.
Frankly, a no-action alternative is an estimate of 
what the future will look like if this decision is not made, 
and yet, other agencies continue to make the decisions they 
are making at present.  And I think the problem with that is 
that the decision making of the Board is interdependent.  
The decisions of other agencies and the Board are all 
interdependent so that the Board's decision to take no 
action would have an impact on those other types of actions.
I guess the simplest question would be the Principles 
for Agreement anticipates that the Board would take action 
to implement whatever is appropriate of the standards in the 
principles in the Water Quality Plan in this proceeding.
And if you didn't do it, then the question is, how 
much would the Principles for Agreement unravel?  What 
points would we all go back to?  
MR. DEL PIERO:  How far?
MR. ANDERSON:  How far, that's right. 
Conceivably we would take a look at D-1485 with the 
1994 NMFS Biological Opinion and I'm not exactly sure about 
the U. S. Fish and Wildlife Service, but it would be very 
very complex and it is probably impossible to try to put 
your finger on.
I think it's appropriate -- the EIR is a disclosure 
document.  It doesn't require you to predict the future with 
certainty.  It simply requires you to say what's on the 
table here and what might change, what are the variables, 
and to perhaps pick one or two, or possibly three possible 
scenarios and discuss them, and that's really what it is, a 
discussion and disclosure document.
MR. DEL PIERO:  Mr. Chairman, I am just looking for a 
no-project alternative that is going to be static for at 
least a day and a half.
MR. ANDERSON:  I appreciate that.  I think your staff 
appreciates that, too.
The Department is certainly willing to provide any 
information or help we can to the Board staff.  We are doing 
operations, we are the ones that submitted the proposed 
projects to the Federal agencies and if we can be of help to 
you there -- you have also asked about level of development 
analyses, things like that, and we are certainly ready, 
willing and able to help you in any way we can provide to 
you and the parties information on possible alternatives 
under this hearing.
Issue 13 asks:  What are the actions the Board should 
take to improve habitat conditions in the Bay-Delta 
watershed?
I think we are kind of at a point now where we are 
looking to Category 3 and to other efforts to make 
improvements under the Principles for Agreement to make 
those improvements in the watershed.  We think that if you 
do not know what the public interest required in the Delta, 
that can vary depending on what may be doable in the 
watershed.
We think that decision, however, has been made, that 
we have a set of objectives that you folks are going to be 
implementing for the Delta that already represent likely 
actions to be taken in the watershed.
So, frankly, we think that what happens in the 
watershed is of interest to you, but you should look to the 
Category 3 program for guidance in that area.
Issue 14:  What monitoring requirements should be 
established by the Board to evaluate the effectiveness of 
actions taken as a result of this proceeding?
I think the Federal Ecosystem Directorate 
representatives answered this question well.
We divided it into two parts just to make sure there 
wouldn't be any misunderstanding, the compliance portion and 
the report on the effectiveness, and we think it is 
appropriate for the Board to be involved directly with 
issues of compliance monitoring under this.
We have suggested for your interest and attention 
what might be an appropriate cost allocation scheme for 
that.
As to simply the monitoring that would be required to 
evaluate the effectiveness of your actions, I think this 
fits into a larger monitoring scheme that has been set up 
and under way and goes well beyond the Board's specific 
interest here.  It's been mainly being carried out by the 
Interagency Ecological Program as the Federal agencies and 
Fish and Game touched upon.
I think in both the compliance and the evaluation of 
monitoring, the Board should look to those for guidance and 
direction as to what might be appropriate programs.
We think a compliance monitoring program, however, is 
the one which the Board should actively be involved in in 
terms of an order under these proceedings.
Issue 15, we basically answered last time.  
As the Board is proceeding, we think that is a good 
way to go, that the workshops are preferable.  There may be 
on occasion a work group.  Obviously, I think the Board 
wants to keep maximum flexibility in structuring this thing.  
You may find some areas, but I think the communication and 
the public airing of a lot of these things is real important 
at this point, so I think the workshop format is the 
preferable one.
That is our presentation.  Does the Board or staff 
have questions?
MR. CAFFREY:  Thank you very much, Mr. Anderson.   We 
appreciate your input.
Ms. Forster and then Mr. Brown.
MS. FORSTER:  On this issue that you brought up about 
the cost of monitoring, has that been talked about at all 
with the groups that are meeting and discussing the 
different issues?
MR. ANDERSON:  I, frankly, don't know the extent to 
which that has been discussed, but Steve Ford is here --
MR. FORD:  It's been talked about within the IEP 
groups. I don't know, it might be a question that you could 
ask the water users group if that's been discussed within 
their forum.
My name is Steve Ford with the Department of Water 
Resources.
MR. CAFFREY:  Thank you.
MS. FORSTER:  That would be interesting for people to 
comment on.
MR. CAFFREY:  Mr. Brown, I believe you were next.
MR. BROWN:  Thank you, Mr. Chairman.
Dave, on issue 8, you state that all users in the 
watershed that feed the Bay-Delta Estuary should share 
responsibility.
MR. ANDERSON:  Yes.
MR. BROWN:  Clarification, do you mean just the water 
users in the watershed, or were you including water that is 
diverted out of the watershed to other users and 
contractors?
MR. ANDERSON:  What I mean is anyone who uses water 
supplies of the watershed, so that would include the folks 
that divert out of the watershed.
MR. DEL PIERO:  Mr. Anderson, I'm going to ask a real 
tough question.  I am telling you that in advance.  Maybe 
you have a perfect answer but I am going to ask it anyway.
On page 2 of your statement, the first full paragraph 
on the Category 3 program, the last sentence says that 
participants will also be looking toward funding projects 
that have potential long-term benefits.
One of the underlying Principles for Agreement, 
Category 3 program, was identification of funding for those 
non-water-related improvements in order to try and assist in 
the doubling process.
Is your Department of the opinion that this Board 
should consider specific terms and conditions to be 
incorporated into the water rights order that allocates 
responsibility for funding those improvements?
MR. ANDERSON:  No.
MR. DEL PIERO:  I would ask you how they are supposed 
to do it then?
MR. ANDERSON:  There is an MOU that is circulating 
and a lot of folks have signed already.  Now, getting the 
funding under the MOU is a question.
MR. DEL PIERO:  It's all voluntary.  That's why I'm 
asking the question because in terms of enforcing terms and 
conditions for a water right, you don't have the luxury of 
hoping everybody is going to agree.  We have to have some 
degree of public enforcement authority, so that's why I am 
asking the question.
The suggestion you made here, granted is the way that 
the process is going, but in terms of our regulatory 
responsibility, it is difficult for me to figure out how to 
draft a term for that.
MR. ANDERSON:  If I can maybe offer some insight on 
that.  Obviously, the objective itself that the Board has 
put into the Water Quality Plan recognizes there will be 
actions taken elsewhere in the watershed, and I think 
implicitly recognizes, as does, say, the Racanelli decision, 
there are actions that may well be taken by agencies, 
individuals, even legislative action which is totally 
outside the Board's authority, and they will do it in 
concert with the regulatory actions taken by the Board.
So, if we have a given objective, as much as I 
appreciate the fact the Board will give every assurance that 
the action will be achieved through the process it has 
available to it, it may have to be looking to actions which 
are really outside of its jurisdiction and take some comfort 
in the fact other people are working on this, too.  I think 
that is something that is recognized under the Porter-
Cologne and Racanelli, as well as implicit in the 
requirement for doubling.
MR. DEL PIERO:  The reason I ask the question is that 
under Racanelli it is recognized, and the problem is under 
CEQA there are a number of court cases that say if you don't 
have a definitive mechanism by which to implement identified 
mitigations, then your document is deficient and that's the 
concern that I have got in terms of how to have very 
specific implementation strategies, if, in fact, these 
proposals are to be incorporated as part of our concept in 
water rights.
MR. ANDERSON:  Well, that's something that we can put 
out to the folks and perhaps we can get some assistance on 
this issue.  I can't sit here and tell you what --
MR. DEL PIERO:  I'm letting you know why I am raising 
the issue.
MR. ANDERSON:  I think we might be able to develop 
some thoughts that might be of assistance to the Board.
MR. DEL PIERO:  Thank you.
MR. CAFFREY:  Anything else from the Board? 
Anything from staff?
Mr. Howard.
MR. HOWARD:  On issue 8, you have a recommendation 
that we look at a small group of water rights at a time 
rather then the more global proceeding of looking at all the 
water rights simultaneously.
Do you have any idea how an EIR would be structured?  
Would we do a large EIR or write separate EIRs for each of 
the smaller proceedings?
MR. ANDERSON:  I think there are a number of 
mechanisms under CEQA that might be available for this kind 
of progressive-action programmatic EIR.  Frankly, I haven't 
thought about that.  I think a programmatic EIR may be the 
way to go.
MR. HOWARD:  Thank you.
MR. CAFFREY:  Thank you very much, Mr. Anderson.
Next is Morris Allen from the City of Stockton.
Good morning, sir, welcome.
MR. ALLEN:  Thank you very much, Mr. Chairman.  I 
appreciate the opportunity and your indulgence to present 
our testimony today on issues 1 through 6, since we were 
unable to attend your August workshop, and also, appreciate 
those other issues being discussed.
I am going to focus my comments this morning on 
issues 5 and 6.  I have submitted a full text of our 
comments on all the issues, but I felt since issues 5 and 6 
are of much more interest to the City of Stockton, I would 
bring those to your attention this morning, and I will also 
summarize my comments and this will be very brief.
In terms of issue No. 5, the City of Stockton 
supports the recommendation made at your August workshop by 
the Department of Water Resources that a workshop be devoted 
especially to the dissolved oxygen issues.  
I heard Mr. Pettit mention to you this morning that 
that is not going to be a Board workshop.  However, we have 
taken steps, on the strength of that recommendation that was 
made, to contact the Department of Water Resources and are 
intending to meet with them this week to begin the process 
of working with the Department of Water Resources to develop 
additional information relative to the dissolved oxygen 
issue in the San Joaquin River.
The City of Stockton feels very strongly that 
implementation of the dissolved oxygen objective must be 
equitable and require participation by all entities whose 
actions affect dissolved oxygen in the watershed, not just 
dischargers or just one particular class of individual.
Water quality objectives are to be based on 
considering water quality conditions that could reasonably 
achieve through coordinated control all factors which affect 
water quality in the area.  This is a citation from the 
Water Code.
Necessarily, the implementation of an objective based 
on such considerations must take into account and address 
all factors that affect dissolved oxygen concentrations.  
	When it adopted six milligrams per liter objective in 
the Salinity Plan in 1991, when it reviewed that objective 
in 1995, the State Board endorsed exactly such an approach.
Stockton is planning on spending a consider amount of 
money to improve dissolved oxygen in the Stockton area, 
however, Stockton can't mitigate the impacts of other 
factors or be called upon to do so, and the implementation 
phase must equitably allocate the burden of improving water 
quality to all those whose actions affect it.
Item 3, actually on issue 5, the implementation phase 
should consider not only the six milligrams per liter 
dissolved oxygen water quality objective applicable in 
September through November, but also, the five milligrams 
per liter objective applicable in the San Joaquin River in 
December through August.
The Central Valley Project basin plan contains a 
water quality objective of five milligrams per liter 
applicable from December through August for the San Joaquin 
River.  This objective has been in place approximately 20 
years and as Stockton's testimony before this Board 
previously indicated, this five milligrams per liter 
objective is currently not being met.
We feel that the five milligrams per liter objective 
is no less deserving of attention than the six milligrams 
per liter objective more recently adopted by your Board in 
the Salinity Plan.
Actions by your Board or diverters related to flows 
and diversions inevitably will affect the ability or 
inability to obtain the five milligrams per liter  
objective.  Moreover, it is necessary to comprehensively 
manage all the factors that affect attainment of the five 
milligrams per liter objective.
In fact, the Central Valley Regional Board basin plan 
specifically refers to the State Board's utilization of 
State Board authority as a means to achieve the objectives 
in the basin plan.
Feasibility of achieving dissolved oxygen objectives 
should be assessed.  Comprehensive consideration of the 
implementation of an objective necessarily will and should 
result in an evaluation of the reasonableness and 
feasibility of obtaining that objective.  If an objective is 
not reasonably attainable, it should be modified.
Above all, no one party should be required to attempt 
to single-handedly achieve an objective that is not 
reasonably attainable.
Point 5, the State Board should promote and encourage 
negotiated solutions to address dissolved oxygen problems.  
	We are encouraged to hear comments by State Board 
members to this effect, that you encourage negotiated 
solutions to be brought before you to address the various 
problems involving these considerations.
We are also recommending that you encourage 
negotiated solutions to address dissolved oxygen problems as 
well.
Point No. 6, the implementation phase should be 
integrated or take into consideration the State Board's 
review of the City of Stockton's appeal of its recently 
renewed NPDES permit.  Stockton is not proposing or 
advocating that any requirement for treatment improvements 
be deferred until the end of the water rights phase; rather, 
the City is prepared to move forward with increased 
treatment that will lead to improvement in dissolved oxygen 
in the San Joaquin River.
Stockton should not at this time, however, be 
required to implement costly and extraordinary treatment 
measures that are imposed before the comprehensive 
consideration of the dissolved oxygen objectives and their 
implementation has been undertaken by the Board.
As you probably are aware, Stockton has an appeal 
pending before your Board with respect to reissuance of an 
NPDES permit for Stockton's wastewater discharge.  In the 
appeal Stockton is not seeking to avoid more stringent 
effluent limitations.
MR. DEL PIERO:  Excuse me, Mr. Chairman.  
Does counsel want to comment on discussing an issue 
that is going to be brought before us later on?
MR. HOWARD:  It has been noticed.
MS. LEIDIGH:  There was a copy of a letter that 
indicated to all the parties that it is to be brought up 
today.
MR. DEL PIERO:  Oh, really?  Maybe the parties have 
it, but I didn't see it.
MS. LEIDIGH:  The dissolved issue is in the workshop 
notice.  I think it is noticed for this workshop also to be 
discussed.
MR. DEL PIERO:  The appeal that is pending before the 
Board?
MS. LEIDIGH:  Not the appeal.
MR. DEL PIERO:  That's the issue.  
MR. SIMMONS:  Mr. Del Piero, I am Paul Simmons. I 
represent Stockton in that appeal, and I did serve a copy of 
this testimony on all the interested parties in the appeal.
MR. DEL PIERO:  Thank you.
MR. CAFFREY:  Please proceed, sir.
MR. ALLEN:  It is completely at odds with the 
approach of the Salinity Plan to deal with Stockton's 
effluent limitations in a vacuum.  Such an approach puts the 
cart before the horse.  The very purpose of the State 
Board's implementation phase is to determine the appropriate 
and equitable allocation of responsibility for addressing 
dissolved oxygen along with other water quality parameters.
The State Board should not, for example, revise an 
individual water right permit today in order to meet Delta 
outflows and then decide tomorrow how to deal with the 
allocation of water in order to meet Delta outflows.
We believe that the Board should integrate 
consideration of the permit appeal with the conduct of the 
implementation phase.
Stockton, again, is not suggesting that any or all 
requirements for additional treatment be deferred, however, 
Stockton hopes the Board will be able to establish a 
mechanism which will enable Stockton to discuss with the 
Board or Board staff the appropriate way to proceed on these 
related issues.
Point 7 -- this concludes our comments on issue No. 
5.  Reclamation of wastewater is a long-term goal of the 
State of California and this Board.  Therefore, 
implementation of dissolved oxygen objectives should not 
inhibit Stockton's ability to proceed with its water 
reclamation efforts.
In other words, what we are saying is don't make 
wastewater treatment so expensive for Stockton that there is 
no money left over for carrying out the reclamation program 
we have embarked on.
Stockton has a long-term goal for full reclamation of 
its wastewater.  Stockton urges that this goal be considered 
by your Board in the implementation phase.
The treatment improvements that we are embarked upon 
currently will cost Stockton citizens at least 150 million 
dollars.  The requirement for treatment that results from 
these proceedings, or the NPDES permit, could increase this 
burden by adding another 50 million dollars to the 150 
million dollar cost for the City of Stockton's treatment.
In turn, such added requirements could delay or 
reduce the likelihood of financing of capital to effect 
reclamation.  In effect, it's kind of shooting ourselves in 
the foot.
Thus, imposing unduly stringent treatment 
requirements on Stockton could inhibit reclamation in the 
long term and prevent us from proceeding with it at all.
We have one comment to make to you on issue No. 6 
with respect to the barriers.  The City of Stockton believes 
that in general voluntary agreements are preferable to 
regulatory mandates for establishing water quality 
improvement programs.
However, if there is any uncertainty regarding 
voluntary implementation of appropriate mitigation measures 
that are identified, the State Board should require 
implementation of such measures.
We believe that evidence will be developed through 
this workshop process concerning the installation of 
barriers.  If the evidence demonstrates that the 
installation of barriers will proceed without State Board 
mandate, it may not be necessary to impose conditions in 
water rights permits; however, if contrary, we also believe 
that if there is no such voluntary participation, then the 
State Board should require the implementation of barriers.
That concludes our testimony, Mr. Chairman.
MR. CAFFREY:  Just one minor correction.  On page 3 
of your attachment you have Specific comments regarding 
issues 6 and 7.  I believe you mean 5 and 6?
MR. ALLEN:  That's correct.  That was a typographical 
error and I appreciate your bringing that to my attention.
MR. CAFFREY:  Okay, sir.
Are there questions from Board members?
Mr. Brown.
MR. BROWN:  Thank you, sir.
Mr. Allen, I am a little familiar with the program 
you have for reclamation.  I understand it is about 40,000 
acre-feet a year you are considering with several options of 
treatment.
Are you looking at the treatment beyond Title 22 in 
order to reclaim the water, or are your concerns that there 
will be other requirements other than Title 22 for reuse by 
this Board -- the Regional Board might implement to restrict 
your reusage?
MR. ALLEN:  What we are concerned about is that the 
requirements that are being imposed on wastewater treatment 
are far in excess of Title 22 requirements, and that we 
would be required to implement those ahead of the time that 
our reclamation program is able to get under way.
So, in effect, we would be expending large sums of 
money for treatment that really is not necessary for 
reclaimed water usage.
MR. BROWN:  You are concerned that this Board action 
that we are considering might have repercussions with your 
treatment requirements that would make it prohibitive to 
reclaim and reuse the water?
MR. ALLEN:  That's correct, sir.
MR. BROWN:  Okay.
MR. CAFFREY:  Mr. Del Piero.
MR. DEL PIERO:  In regard to what?  Is it your 
suggestion that distribution pipelines would be foreclosed 
because of the cost of the additional treatment 
requirements?
MR. ALLEN:  What we are looking at, Mr. Del Piero, is 
the possibility of expending an additional 50 million 
dollars to meet our wastewater discharge permit 
requirements, specifically for nitrogen removal, and that 
would not even be desirable under a reclamation alternative.
So, in effect, you spent 50 million dollars for 
something that has no benefit for your reclamation program, 
removing 50 million dollars from the community that could be 
spent on reclamation facilities such as a distribution 
system.
MR. DEL PIERO:  So, your objection in terms of that, 
and at least in relationship to this, is your concern as to 
how this Board is going to incorporate a standard mandating 
nitrogen removal that would then cause the reclaimed water 
not to be as valuable for irrigation of crops?  Am I getting 
close?
MR. ALLEN:  You are getting close to it.
MR. DEL PIERO:  I am trying to figure out what 
project is going to be foreclosed to the City of Stockton if 
the nitrogen removal requirement is imposed.
MR. ALLEN:  Very simply, if the community has to 
spend another 50 million dollars to achieve nitrogen 
removal, then possibly and most likely it can't afford to 
construct the facilities to implement a reclamation program.
MR. DEL PIERO:  When you say facilities, what does 
that mean?
MR. ALLEN:  Distribution system, storage reservoir.
MR. DEL PIERO:  You are doing the removal already?
MR. ALLEN:  Right, and then, the type of uses that 
are being considered, which is reuse for agricultural and 
irrigation purposes, nitrogen removal is actually 
detrimental, so the facility installed to do that would just 
have to be mothballed or eliminated.
MR. DEL PIERO:  So, the trade-off is treatment versus 
distribution?
MR. ALLEN:  Correct.
MR. DEL PIERO:  Okay.
MR. CAFFREY:  Mr. Brown.
MR. BROWN:  Mr. Allen made a good point here.  I 
think we want to be very cognizant that we don't come up 
with some criteria that could become in a sense useless 
later on.  
We are concerned with the water quality in the San 
Joaquin and we have developed criteria to meet that water 
quality, and then you decide to come up with a reclamation 
program that reuses 40,000 acre-feet or thereabouts.  
I think what you are requesting is that there be 
consideration that there not be unreasonable requirements to 
prohibit full reclamation.  I think it is important for you 
to keep the Board informed of your progress.  I think we 
talked about this before.  I think it would be interesting 
for all the Board members to know what your options are and 
what you are considering down there.  I think it is unique.
Thank you for your time.
MR. DEL PIERO:  Where is your nitrogen problem coming 
from?
MR. ALLEN:  Where is it coming from?  This is one of 
the characteristics of wastewater.
MR. DEL PIERO:  No, I understand it is characteristic 
of wastewater, I can assure you.
MR. ALLEN:  What requirement?  The dissolved oxygen 
requirement requires us then to remove nitrogen from the 
wastewater.
MR. DEL PIERO:  Okay.  You asked my question far 
better than I did.
Your plant, how much did it cost?
MR. ALLEN:  Our expansion program costs 150 million 
dollars.
MR. DEL PIERO:  To serve what population?
MR. ALLEN:  To serve a population of about 310,000 
now and ultimately about 490,000.
MR. DEL PIERO:  How much?
MR. ALLEN:  One hundred fifty million dollars.
MR. DEL PIERO:  You got a good deal.  It cost us 160 
million dollars in Monterey County for 290,000 to do the 
same thing.
MR. ALLEN:  The benefit is we have an existing plant 
that is rated at 45 million gallons a day and we are going 
to 65 million gallons a day.  We had something to start 
from.
MR. DEL PIERO:  We had buckets.  We didn't have much 
to start from.
MR. CAFFREY:  Mr. Pettit.
MR. PETTIT:  Just for clarification, Mr. Allen.  When 
I indicated earlier that I thought the Board could give us 
some possible direction to proceed with the work on 
barriers, I didn't mean to indicate there had been a 
decision against that.  I just thought that was still up in 
the air.
MR. ALLEN:  Thank you.
MR. DEL PIERO:  Your proposal is to remove all 
discharge from the river?
MR. ALLEN:  Ultimately, yes, the City Council has 
made a decision to reclaim 100 percent of the effluent.
MR. DEL PIERO:  What is the critical path?  What is 
the time line in terms of implementing that 100 percent 
removal?
MR. ALLEN:  We are on a track that will result in the 
reclamation plant being on line in about ten years from now.
MR. DEL PIERO:  Ten years from now?
MR. ALLEN:  Yes. 
MR. DEL PIERO:  Do you have financing for that?
MR. ALLEN:  We are identifying the financing right 
now.  We are about complete with a marketing evaluation 
which will identify customers and financing requirements, 
and set up a time line, and actually develop a project 
proposal.
MR. DEL PIERO:  Now, I understand what the problem 
is.  Thank you.
MR. CAFFREY:  All right.  Questions from staff?
MR. HOWARD:  No.
MR. CAFFREY:  Thank you very much, Mr. Allen.  Thank 
you for your input.
We will now hear from a panel which represents the 
Upstream Users and the names I have are Jim Chatigny, Steve 
Chedester, Noble Sprunger, Bill Baber, Mike Sexton and Alan 
Lilly.
MR. BABER:  Noble Sprunger is not here.
MR. CAFFREY:  Mr. Chatigny.
MR. CHATIGNY:  Good morning, Chairman Caffrey and 
Board members.
This is a joint statement of the Upstream Users.  
This is submitted on behalf of the 39 water purveyors that 
hold senior water rights on the Sacramento, the San Joaquin 
and other streams tributary to the Delta.
You have heard from the San Joaquin side of the Delta 
and of the 39 agencies, a third of them are DTAC members and 
I am here as chairman of that DTAC.
We are going to respond this morning to key issues 7 
through 15 of the notice for the workshop.  I am not going 
to talk about all of them because we have heard comments 
from other agencies and other departments, so we are going 
to pick a few.
You were handed a copy of our testimony at the last 
meeting, at which time we had not quite decided when we were 
going to give our presentation.
Key issue No. 7:  Are there any additional actions 
necessary?  
At the present time our answer is no.  The action we 
should be taking is to implement the narrative salmon 
requirement, is to observe the salmon populations to 
determine how these populations are going to respond over 
time, and the comment that we have is that the Department of 
Fish and Game just recently, sometime in August, indicated 
that the fall chinook salmon run was the best they have 
experienced since the mid-1960s, so something good is 
happening.
Issue No. 8:  Which water rights should be subject to 
this water right decision, and it is the position of the 
upstream users that only water rights in the Delta watershed 
that should be subject to the water right decision are those 
that are covered in the operation of the Central Valley 
Project and the State Water Project that meet the demands of 
their water service holders.
The operators of the Central Valley Project and the 
State Water Project to meet said demands have caused the prob-
lems, we feel, in the Bay-Delta Estuary, and the Water Board 
should look to such operators to bear that sole responsibility.
No. 9:  What are the potentially significant 
environmental and economic effects of an alternative 
allocation methodology of a Delta watershed?
Any attempt to reallocate water from the upstream 
users to the Bay-Delta water quality and/or export uses will 
have a very significant environmental and economic effect 
which would include, but not be limited to impact on the 
availability of habitat for waterfowl and water which is 
provided now by irrigated agriculture.
Impacts on the groundwater basins includes the 
creation and/or exacerbation of problems of overdraft, well 
interference and/or land subsidence.
Another item would be the impairing of productivity 
of prime agricultural land by reduced water supplies.
There are several others that we have alluded to and 
I will leave those for you to read.
Item 10, and this is a very important one and I am 
going to do the whole issue here.
What methods should be used to allocate 
responsibility to meet water quality and flow requirements 
in the Sacramento River, the Delta, the Suisun Marsh, to the 
upstream users?
And our response is, the users urge the State Water 
Board to apply the following principles in allocating 
responsibility to meet water quality and flow requirements.  
You might notice that these are familiar.  These are the 
DTAC principles that have been submitted to you previously.
The State Water Board should recognize and follow the 
area of origin, watershed protection and Delta Protection 
Act principles.
The State Board should recognize the impact of Delta 
exporters and diversions, and require those diverters to 
mitigate their adverse environmental impacts.
And consistent with principles one and two, the State 
Board must rely on the priority system to allocate 
responsibility for Bay-Delta water quality objectives and 
for flow requirements.
Municipal and domestic use should receive no special 
preference in the allocation of responsibility to maintain 
Bay-Delta water quality objectives and flow requirements.
The State Board's Environmental Impact Report must 
fully analyze the significant impacts upon the environment 
that would result from the Board's action.
Additionally, as you have heard from earlier 
comments, the ongoing discussions are cordial but are going 
slowly, and I am referring to the Ag/CUWA upstream users 
discussions.
We remain optimistic that resolution of complex 
issues can occur, but they are going slowly for a very 
simple reason.  The State Water Board has not established 
reasonable goals and objectives of what these settlements 
are supposed to achieve.  If anything, repeated 
pronouncements of reallocation only compound and prolong 
settlement discussions.  
We would suggest to you that settlement cannot be 
achieved unless you request that your staff prepare an 
analysis based on the water quality criteria that were 
established by the Water Board on May 22, 1995, and send out 
for public review and consideration the impacts of meeting 
those relevant water quality requirements on those entities 
who have heretofore obligated themselves to meet them by 
virtue of their water rights and under law, DWR and the U. 
S. Bureau of Reclamation.
It is both entities and junior water-right holders 
who have voluntarily and willingly accepted responsibility 
for minimizing impacts that they produce in the Sacramento-
San Joaquin Bay-Delta Estuary.
And it is the decline in the estuary since the 
expansion of those projects in the late sixties that has 
produced this hearing.  This is important because rather 
than asking us what else can be done if settlement does not 
work, this Board, with the expertise and staff apparently to 
make those kinds of analyses, should be telling us what 
happens to those projects if we don't settle; because we are 
being asked to negotiate away our water rights, which 
clearly is what is being asked, negotiate to give up some 
water or risk reallocation -- what is the term?  Permanence 
is the key component of the term.
Why would we negotiate a compromise which we cannot 
last out?  Therefore, we believe it is incumbent upon the 
Board to direct staff to set forth in detail the issue from 
the standpoint of impacts on the State and Federal projects, 
what public trust resources will be adversely affected if 
full demand for these standards is placed on those who have 
previously covenanted to meet them.
After all, it may be quite possible for those who 
have committed and agreed to do so as part of the 
construction of their master projects, will be able to do 
so.
Item 11:  Should the Water Board approve combined use 
of the Central Valley Project and State Water Project points 
of diversion?
The upstream users generally support measures that 
will result in more efficient diversion and use of water so 
long as the measures are consistent with the principles 
outlined above, and in response to key issue No. 10, and so 
long as an adequate analysis of the impacts of such measures 
is performed prior to any decision to implement.
Item 13:  Are there actions the Water Board should 
take, including actions discussed in the implementation 
program for the Bay-Delta Plan to improve habitat conditions 
in the Bay-Delta watershed?
The Upstream Users believe that there are a number of 
actions that the State Board should take to improve habitat 
conditions in the watershed.  Many of these actions are 
identified in the Water Quality Control Plan adopted by the 
State Board on May 22.
The State Board should implement some of the 
following measures when reasonable and cost effective, and 
again, we have about 10 or 12 of those, but I will just pick 
out several of them.
One of them would be consultation with the Department 
of Water Resources, Department of Fish and Game and Cal-Fed.  
The State Board should implement programs to reduce 
entrainment and improve fish survival at the State Water 
Project and Central Valley Project export facilities.
The State Board should consult with and encourage the 
Department of Fish and Game to increase its efforts to 
enforce compliance with existing fishing regulations and 
minimize the harvest of fish in the watershed.
The third item, in consultation with Fish and Game, 
National Marine Fisheries Service and the U. S. Fish and 
Wildlife Service, the State Board should increase its effort 
to prohibit introduced species of fish from adversely 
impacting the native fisheries of the watershed.
And the State Board should delay the implementation 
of other activities to enhance the Bay-Delta watershed 
habitat conditions until such time as the State Board and 
the interested parties are able to evaluate the foregoing 
programs to determine which programs are most cost 
effective.
Issue No. 14:  What monitoring requirements should be 
established by the State Board to evaluate the effectiveness 
of actions taken as a result of this proceeding?
Our response is coordinate D-1485 monitoring require-
ments with the regulatory enforcing activities of local, 
State and Federal agencies required to implement State Board 
actions taken as the result of these proceedings.
And then, item 15:  Should the Water Board establish 
work groups to aid the Board in evaluating issues associated 
with plan implementation?
At the present time, we do not favor the 
establishment of such work groups.  The present discussions 
that we have ongoing with the Upstream Users and the Ag/CUWA 
groups should be allowed to run their course.  As I 
mentioned earlier, they are moving ahead.  They are moving 
ahead slowly, but we would like to see these negotiations 
and these discussions continue on for a period of time so 
that we can come to an amiable and negotiated settlement.  
We would like to continue that.
That is pretty much my comments in regard to this.  I 
think some of the panel would have several items to discuss.
MR. CAFFREY:  You gentlemen are going to comment?
MR. SEXTON:  My name is Mike Sexton.  I am speaking 
today on behalf of the Exchange Contractors who, as you 
know, are full water-right holders on the west side of the 
San Joaquin Valley.
I would like to touch just briefly on a couple of 
things that were said earlier by the Department of Water 
Resources representative, and perhaps also respond to a 
query posed by Mr. Pettit at the beginning of the proceeding 
today.
Before I start, I would just like to tell the Board 
we all know that you are in just an awful position.  I mean, 
everybody here appreciates the position you are in, the 
difficulty of what's being placed before you and the 
difficulty that your staff is going to have in making 
recommendations to you.
However, having said that --
MR. DEL PIERO:  We were just talking about how lucky 
we were.  I am not sure awful applies to us, but we will 
see.
MR. SEXTON:  It's a tough position to be in.  
When we are dealing with land-use matters, of course,  
the saying is, not in my back yard.  When we are dealing 
with water rights matters, of course, the battle cry is, 
take water from others, you don't take it from me. And 
somehow you have to balance all of that within your 
jurisdiction.
I would just like to point out briefly that I think 
you got here from this December 15 accord, and this being 
touted as the great agreement that started this whole thing 
off.
The Department of Water Resources suggested that 
perhaps rather than focus on the projects, that maybe what 
you ought to do is focus on the five largest water users not 
involving the projects.  That would probably the Exchange 
Contractors' attention real fast; and yet, very 
surprisingly, the Exchange Contractors were not involved in 
that December 15 accord.
So, you have got perhaps one of the largest diverters 
of water, going back to Miller & Lux, and for whatever 
reason, they weren't part of the accord, which is really 
interesting when they used that as the basis for then 
reallocating water in order to reach the accord.  That is 
real troublesome to us because that's exactly what you are 
being asked to do.
You start off with a premise.  You have this 
agreement and then you are told to reallocate water to 
implement the premise, but some of the most significant 
water-right holders weren't involved in developing the basic 
premise.
We do not believe that the Board has jurisdiction 
over pre-1914 and riparian water rights which the Exchange 
Contractors hold, except perhaps to the extent that you 
would scrutinize the use of that water under Article X, 
Section 2, to prevent waste and unreasonable use.
Notwithstanding that --
MR. DEL PIERO:  Only.
MR. SEXTON:  Only.
MR. DEL PIERO:  There is a case called Audubon.
MR. SEXTON:  I have read it, Mr. Del Piero.  
Notwithstanding that, many of the commenters you have 
heard, not just today but at the last workshop, have 
suggested perhaps you share the pain with all the water 
users, that you should do equity, you should determine 
proportionate responsibility, you should act to benefit the 
estuary in some manner not really specified, you should act 
in the public interest, again not specified.
What I think is missing, first of all, is a clear 
legal basis for you to act in the way that some of these 
commenters are urging you to act.  
Of course, Article X, Section 2, that is fine and 
dandy, just throwing it out, but Article X, Section 2 
requires that you make the determination that that water is 
not being placed to beneficial use.  Public trust, yes, we 
all understand you have some authority in the public trust, 
but we don't know to what extent that is going to be or that 
you are even going to try to impose that on pre-1914 water 
users.
Racanelli gets thrown around as being the basis for 
the State Board to do all manner of wonderful things, and 
based on that at the last hearing I heard one commenter 
suggest that you take 175,000 acre-feet away from Friant.  
We heard proposals that all that is needed is just to 
recirculate water through the Delta all the way around and 
back up the other side.  
These comments are just wonderful but you can't look 
at these in a vacuum without understanding the impact that 
changes operation like that will have on water-right 
holders, and nobody is suggesting that you can do that.
I think it will be important for the water-right 
holders, if the Board could have its staff, its attorneys, 
its engineers and whomever, give to the water-right holder 
what you view, as number one, your authority to act as to 
pre-1914 and riparian waters; and number two, the intended 
scope of your scrutiny to the use of those waters.
And I would suggest to you that it is very difficult 
for the water-right holders to provide to Mr. Pettit and the 
staff intelligent recommendations on alternatives until we 
know the legal basis and then the scope of the State Board's 
intended scrutiny.
Thank you.
MR. CAFFREY:  That completes the 20 minutes.  Do you 
need more time?
MR. SEXTON:  Yes, there are two more.
MR. CAFFREY:  How much more time do you need?
MR. BABER:  Maybe combined, ten minutes.
MR. CAFFREY:  Mr. Del Piero.
MR. DEL PIERO:  Do you have those comments in 
writing?
MR. BABER:  The ones Mr. Sexton, we don't have those 
in writing, but we have the comments that Mr. Chatigny 
reviewed.
MR. DEL PIERO:  Can we get back to real specificity 
in terms of what you are submitting?
MR. SEXTON:  I would be glad to.  I didn't want to 
bore you with what we submitted in writing.  I will be glad 
to put this in writing.
MR. BABER:  It is in the transcript.
MR. CHATIGNY:  And it's also in response to key issue 
10, the allocation methodology we talked about, and then 
Mike just gave you more specifics here.
MR. CAFFREY:  Mr. Brown, did you have a question?
MR. BROWN:  Staff, on the December 15 accord, which 
we were not a party to either --
MR. BABER:  You, too?
MR. BROWN:  For what it's worth.  That accord did not 
come up with a Water Quality Control Plan -- did it have in 
it the recommended procedure of how to acquire the water 
quality requirements?
MR. HOWARD:  No, it didn't get into the allocation 
methodology.
MR. BROWN:  I don't understand your statement, Mr. 
Sexton.  The accord did not get into the allocation or how, 
but got into what was required.  You are of the opinion that 
the accord had the how in it?
MR. SEXTON:  No, Mr. Brown.  What I intended to say 
and perhaps I didn't make perfectly clear is that as a 
result of the December 15 accord, certainty in water supply 
was assured to some Federal and State water-service contract 
holders, and my understanding is that the Board is now being 
expected to reallocate some water in order to meet water 
quality standards, and essentially what happens is you are 
going to be reallocating water to meet water quality 
standards with has an impact on the amount of water 
delivered not only to water-service contractors, but which 
may also be available to water-right holders.
MR. BROWN:  Mr. Howard, correct me if I am wrong, but 
the certainty that was pursued in this accord was with 
regard to the water quality requirements.
MR. HOWARD:  Yes, it provided certainty as to what 
the standards were.  There was a great deal of fluctuation 
in the requirements and it also provided certainty to the 
projects to the extent that they knew they were solely 
responsible to meet those during the period of agreement.
MR. BROWN:  Does that help?
MR. DEL PIERO:  I think the point the gentleman is 
making is that he is concerned that ultimately in terms of 
implementing the Water Quality Plan through a water rights 
decision, that if, in fact, it is predicated upon this 
accord that was adopted in December, that during the process 
in the end clearly the discussion about equitable 
apportionment has lent credibility to his concern; that 
because there were quarantees in the accord and in the Water 
Quality Plan that in terms of supply that somehow through 
the Board's process here, if we, through the concept of 
equitable apportionment or anything else, reallocated the 
responsibility for water quality in the Delta, that could 
have an impact on senior water-right holders and excuse 
those water-right holders that are junior, like the Central 
Valley Project and the State Water Project, thereby causing 
contract agencies that basically have nothing more than a 
contract to receive water from the State Water Project or 
the Central Valley Project, to be receiving water at the 
expense of pre-1914 appropriators or --
MR. SEXTON:  Thank you, Mr. Del Piero, you have said 
it more eloquently than I, but thank you very much for the 
clarification.
MR. CAFFREY:  Ms. Forster.
MS. FORSTER:  This is an informational question, I 
guess, for you.  I could probably ask my own attorney.
What is your perception of your responsibility as a 
pre-1914 or riparian to meeting some of these habitat 
ecological improvements in the Delta?  I mean, it is not 
just flows.  You must have some responsibility here and I 
wondered what your impression or your convictions were as to 
what your responsibility would be.
MR. SEXTON:  Ms. Forster, to be perfectly blunt, I 
would love to debate that with you some afternoon or some 
morning.  I don't think that is something I can answer very 
briefly because it depends on an awful lot of things.
One thing it certainly depends upon is the seniority 
of the water rights themselves and I don't think that the 
State Board or any other entity can discount that.
Our position is that there were little, if any, 
impacts upon the Delta back in the early forties when these 
water-right holders began taking water by means of the 
Delta-Mendota Canal.
When you superimpose on that other water uses coming 
about in the sixties and later into the seventies, granted 
you are going to put more and more pressure on the estuary, 
and we can't discount that, but just to say, do we have any 
obligation, I think my first answer would be no, unless we 
look at everything altogether.
But generally speaking, we don't believe that our 
diversions have had an adverse effect on the estuary.
MS. FORSTER:  Have your areas grown at all?  Is it 
pretty much the same as it was in the old days?  I mean, 
what happened in the area which you represent?
MR. SEXTON:  In the areas I am representing now, the 
Exchange Contractors consist of four entities which serve 
approximately a little in excess of 200,000 acres.  It's 
been in agricultural production since the Miller & Lux days.  
	The contract between the Exchange Contractors and the 
Bureau of Reclamation, up until the Central Valley Project 
Improvement Act, had a limitation that water could only be 
served in those areas for those uses, so it was not until 
about 1991 when these areas experienced water transfers out 
of the service area.
To answer your question, for the most part the areas 
have remained static.  There has been very very little, if 
any, growth.  There are some cities within the areas which 
are placing groundwater demands in expectations of surface 
deliveries.
But again, until the Central Valley Project 
Improvement Act, there was no way to get surface water to 
them.
MS. FORSTER:  Thank you.
MR. CAFFREY:  Mr. Lilly.
MR. LILLY:  Alan Lilly of Bartkiewicz, Kronick & 
Shanahan.  My firm represents four of the agencies that are 
listed on this group.  Those are Amador County Water Agency, 
Browns Valley Irrigation District, Yolo County Flood Control 
and Water Conservation District and Yuba County Water 
Agency.
I really just want to emphasize two points that are 
made in this written statement.
First of all, and I'm sure we will hear more from the 
exporters this afternoon, and in a way it has worked to our 
disadvantage to anticipate comments before they have made 
them. 
But we think it is productive that the exporters have 
recognized and generally accept the area of origin 
protections, and frankly, with that recognition, that was 
the foundation for the discussions that were alluded to at 
the last workshop, and we look at that as a productive 
process and hope it will go forward.
Now, having said that, I want to just emphasize two 
points for the workshop today.  We are concerned that the 
exporters, having recognized the area of origin protections, 
are attempting to put what we consider to be two 
inappropriate limitations on those protections.
First of all, I don't know if they have come out and 
explicitly said, but basically their equitable, water right 
priority-type analysis would really go backwards from D-
1485.  D-1485 presently requires the projects, the Central 
Valley Project and the State Water Project, to release 
substantial amounts of water from storage to help meet the 
Bay-Delta standards, the standards that were adopted by this 
Board in 1978.
Particularly in the summer months and early fall, 
there are substantial storage releases that are required.
Now, the process that they are proposing would 
basically stop that.  They are asking this Board to go 
backwards from that and instead spread that burden across 
all water right users from the Central Valley. 
We think that is inappropriate because the D-1485 
standards were specifically put in to mitigate for project 
impacts.  It is the projects that entrain the fish from the 
Delta.  It is the projects that cause reverse flows in the 
Delta.  It is the projects that divert water or cause water 
to flow through the Delta Cross Channel resulting in 
environmental impacts.
And since D-1485 held that the projects were 
responsible for mitigating those impacts, even to the extent 
that releases of their stored water were required,  
I don't think it is appropriate for the Water Board 
to basically backtrack from that.  That requirement, at the 
very least, should be maintained.
Secondly, just briefly following up on Mr. Sexton's 
comments, we are concerned about the exporters' -- what I 
will call overexploitation of the waste and unreasonable use 
prohibitions.  We have no objection and never have objected 
to this Board taking action in specific instances to curtail 
waste and unreasonable use of water, and in particular, for 
the Board to follow its regulations which very clearly set 
out the process for that.
We have never supported the waste and unreasonable 
use of water.  What we are concerned about and what we 
oppose, though, is broad involuntary and uncompensated 
reallocation of water under the guise of prohibiting waste 
and unreasonable use.  We don't think that it is supported 
by the law and, frankly, would also be bad policy.
It is not appropriate and I don't think the Board 
wants to get into the morass of deciding that it is better 
to use a certain number of acre-feet of water to grow rice 
or cotton, or to make computer chips, or to wash driveways 
in Southern California.
Once the Board starts down that process without any 
real standards to apply, I think it is going to regret it.  
So, instead, we think the Board is better off staying within 
the scope of the existing water right system and the 
established laws, as I say, using waste and unreasonable use 
to prohibit specific examples where there truly is waste of 
water, which we certainly don't support either; but not to 
try to broaden that into some excuse for general 
reallocation of water.
That's all I have.  Thank you very much.
MR. CAFFREY:  Mr. Baber.
MR. BABER:  I will be brief.  My name is Bill Baber.  
I am with the Minasian law firm.  We represent 15 of the 39 
agencies on the Upstream Users statement, four of which were 
just spoken to very well by Mr. Sexton.
I want to say I support both Mr. Sexton and Mr. 
Lilly's comments, and would just briefly tell you that none 
of our 15 clients were part of the accord in December, nor 
do I believe any of the 39 agencies on the Upstream Users 
statement were members of the accord or agreed to it.  We 
just weren't a part of the process.
In stating that I want to support the comments made 
by Mr. Sexton and Mr. Lilly, I want to affirm that we don't 
believe this Board has jurisdiction over pre-1914 or 
riparian rights.
We have to live with the Endangered Species Act, as 
do you, and we are subject and our clients are subject to 
habitat requirements, as are all of the entities in this 
process.  We all have to live with, for instance, the Sweet 
Homes (phonetic) decision.
So, Ms. Forster, how can the State Board determine 
they have to jump into the process and try to be duplicative 
about requiring the same things on pre-1914 and riparian- 
right holders as on other water rights.  I think it would be 
a waste of this Board's time and it would just be chaos.
MS. FORSTER:  Let me say something since you spoke to 
me directly.  My comment was broader than what I think you 
thought it was, and so, you just did show the hook.  You are 
also heavily involved through ESA with ecological, and 
habitat, and improvements and things like that.  And I just 
wondered philosophically where your responsibilities were in 
those issues, and I appreciate your bringing that up.
MR. BABER:  I will say the philosophical differences 
we have, but we are subject to the legal requirements and we 
comply with them.
With that, I will have no other comments.
MR. CAFFREY:  All right, thank you very much, 
gentlemen.
Are there questions from the Board?
MR. DEL PIERO:  I would like to talk with these guys 
for the afternoon.
MR. LILLY:  We would like to talk to you.
MR. CAFFREY:  Anything from Mr. Pettit or staff?
MR. HOWARD:  I had a couple of questions, one of Mr. 
Chatigny.
In your comments you asked the Board to direct staff 
to set forth the full impacts to the State Water Project and 
the Central Valley Project for implementation of the Water 
Quality Control Plan with their being solely responsible for 
that implementation.
We took a stab at that in the Environmental Report, 
Appendix 1 to the Water Quality Control Plan.  I was curious 
whether you had something specific beyond that that you 
wanted, or whether or not that might be adequate for your 
purposes.
MR. CHATIGNY:  Well, in most cases it is fairly 
accurate.  I would have to go back and look at it myself a 
little more, but it did give us a beginning and a start as 
to where we are going, but we are looking for some more 
specifics, I believe.  
You are dealing with 39 agencies.  You have 39 
inputs.  This is more of a general comment and I could 
probably come up with 39 specific requests for you.
MR. HOWARD:  It would be helpful if you had some 
specific questions because we would like to try to build on 
this document and we don't want to do the same thing over 
again, so if you have some specific concerns about the 
adequacy, we would be interested in knowing what they are so 
we could address them in an environmental document.
MR. CHATIGNY:  I would be very happy to do that.
MR. CAFFREY:  Please remember all other participants 
in the process so we don't leave anybody out.
MR. DEL PIERO:  It is appropriate for us to try to 
respond to that request because part of the process that has 
been articulated by the Chair and Board since we started, we 
were hoping there was going to be some potential for 
collective agreement in terms of these issues.
If those negotiations or even discussions are being 
stalled because of the absence of specificity as to what the 
potential impacts of the Water Quality Control Plan are going 
to be, it is incumbent on us to try to provide that 
specificity so those discussions can either move forward or 
stop.  Just sort of idling doesn't get the Board where we 
want to go, nor does it get the participants any substantive 
benefit either.
MR. CHATIGNY:  I know for myself during the 
discussions, there have been some items that have come up 
that need specific clarification, so I think --
MR. HOWARD:  I had one more question for Mr. Lilly.
MR. CAFFREY:  Mr. Sexton was going to try to follow 
up on Mr. Howard's question.  Do you want to do that?
MR. SEXTON:  Thank you, Mr. Caffrey.
The Exchange Contractors, as you know, are sort of a 
strange fish because the water rights they retain are on the 
San Joaquin River but the water they take is from the 
Sacramento watershed.
And with respect to your question, Mr. Howard, the 
Exchange Contractors share the concern of the San Joaquin 
Tributary Agencies and the folks down the San Joaquin for 
the standards that were established on the San Joaquin side.
And you were spoken to at length about that in the 
last proceeding, and we would urge that for purposes of 
establishing those water quality standards, that the Board 
go back and re-examine them.
Thank you.
MR. CAFFREY:  Thank you, sir.
Mr. Howard, you had a question of Mr. Lilly.
MR. HOWARD:  Yes.  Mr. Lilly, you just made the 
comment that you felt the projects were responsible to 
release stored water to mitigate its effects in the estuary.  
I am trying to ascertain whether or not that means 
you think the Term 91 approach or something similar to it to 
determine responsibility of upstream water-right holders to 
provide outflow is not an appropriate methodology.
MR. LILLY:  Well, this is obviously a very 
complicated technical issue.  
Let me respond that Term 91 is a good approach, but 
with the caveat that D-1485 remain as the base from which it 
is applied.
MR. HOWARD:  That's a tough one but --
MR. LILLY:  Term 91 has been applied with D-1485 in 
place since 1978, so what I am really saying is continuing 
on with the base conditions that have been used for the last 
17 years --
MR. DEL PIERO:  I'm getting close to my no-project 
alternative here.
MR. LILLY:  And we may very well be, too.  We may be 
close to the conclusion that the recommended or preferred 
alternative is the same as a no-project alternative.
D-1485 has been in effect for many years and Term 91 
has been in effect for many years, and that should be the 
base, and if there has to be a change to implement the new 
standards, then the change comes from that base.
But what we don't want is to basically wipe the slate 
clean and say we are going to start over, looking at the new 
standards without considering the fact D-1485 is already in 
place.
MR. HOWARD:  I understand.  Thank you.
MR. CAFFREY:  Thank you very much, gentlemen.  We 
appreciate your input.
We will now take a lunch break until 1:15 and we will 
come back with Mr. Jackson.
Thank you.
(Noon recess)














   MONDAY, SEPTEMBER 18, 1995, 1:15 P.M.
                    --o0o--
MR. CAFFREY:  We will start the workshop again.
We will begin with the order that we suggested 
earlier and that takes us to Michael Jackson representing 
Cal SPA.
Good afternoon, sir, and welcome.
MR. JACKSON:  Thank you, Mr. Chairman.
The first point that we would like to make can best 
be made, I think, from taking a look at the original mailout 
in regard to the Notice of Preparation of an Environmental 
Impact Report from July 27, 1995.
And it's really the map on the back that I would like 
to talk about first.  The map on the back reflects a project 
area that I believe needs to be expanded in two areas.  
The first area is that it does not show the Trinity 
flows as being part of the project area.  As you well know, 
much of the water diverted by the Bureau for later 
rediversion in the Delta comes from the Trinity system, and 
I believe the Trinity system and the impact that the 
requirement that the Bureau alone meet standards in the 
Delta essentially would not be justified unless you include 
the environmental impacts to the Trinity system from using a 
lot of the Trinity water to supply Delta standards.
The second thing that I think needs to be expanded is 
that the map of the project area does not show Suisun Bay 
and San Francisco Bay as part of the project area.  
It's very important to CSPA that the bay be included 
because, first of all, it is half of the estuary; and 
second, there's going to be a substantial amount of 
conversation about the public trust and the public trust  
can't be used -- we hope it can be used as a sword and not 
as a shield.
Now, you can use that either way.  From our point of 
view, the shield is the outflow number.  That's what 
protects the fish and unless the outflow into San Francisco 
Bay and through the Farallons becomes part of this 
environmental document, I do not believe that the 
environmental document would be sustainable in court.
So, with those two changes, I believe the map of the 
project area, the area we are addressing is correct. 
I would like to thank the Board for including the 
areas above the lower dams.  Cal-Fed is running sort of a 
common procedure and I was stunned to find out that the 
Feather River starts in Lake Oroville since I always assumed 
it started in my home county, and I noticed that that was 
true in regard to all of the other rivers.
The blockages that have taken place on those rivers 
by the dams have caused a petition to filed by Senator 
Hayden in regard to the spring-run salmon.  
I think that we ought to be anticipating that we are 
going to be dealing with the spring-run salmon and I think 
we also ought to be anticipating that the spring-run home 
territory is above the dams, and in order to take care of 
that particular race of salmon, you are going to have to 
more than just release water down below because it 
essentially doesn't have habitat at a flat gradient that it 
can reproduce or rear.
So, for those reasons, I thank you for expanding to 
the headwaters of the various rivers.
I think the next important thing that we can do to 
help, if we can do anything to help, is to indicate to you 
that after reviewing D-1630, D-1485 and having taken part in 
most of the hearings for the last 10 or 15 years, I have 
come up with 12 alternatives that I think need to be 
studied, 12 completely different ways that you can satisfy 
the water quality agreement and I would like to go through 
those first.
The first way to satisfy the agreement is an 
alternative that simply stops at the agreement.  I would 
think that would be alternative 1.  I believe that there are 
flaws in the agreement that would be revealed in an 
examination of that alternative in the EIR/EIS for this 
water right hearing.
The second alternative which I would like to see 
studied is probably the highest flow alternative which from 
everything I have looked at seems to be the Fish and 
Wildlife's new instream recommendations on all of the 
tributary rivers.  Those are very high water flows and they 
are not balanced in any fashion, but they did provide, I 
think, the basis for the highest flow alternative and I 
think should be studied in this particular document.
The third alternative which I think would provide a 
basis upon which this particular water right hearing could 
be resolved is the standards in D-1630, and while Mr. 
Stubchaer has pointed out that there is no final document, 
there was an extensive amount of testimony, and so, I would 
suggest that the final draft of D-1630 be alternative No. 3.
For alternative No. 4, I would suggest D-1485.  It is 
alone.  It is inadequate for a number of reasons, but the 
law allows you to study alternatives that don't necessarily 
meet every present legal standard.  What that will do is 
provide you a baseline by which to examine why we ended up 
in the situation that we are in, and will provide areas of 
investigation for each of the other alternatives since we 
have more data on D-1485 than we have on any other single 
potential alternative, and it is essentially a baseline.
The fifth alternative which I would like to see 
studied is the preferred alternative in the Monterey 
agreement draft EIR presently being circulated by the 
Central Coast Water Agency.  That particular draft document 
rejects water transfers, it rejects the building of new 
facilities, rejects a number of alternatives and gives 
reasons for that rejection.
That particular EIS is a very important part since 
it's the Department of Water Resources and the State    
Water Project users' preferred alternative.  What it does is 
commit the State in that preferred alternative to full 
build-out of the 4.2 million acre-feet of water that was 
originally promised in the State Water Project.
That commitment of the extra 2 million acre-feet 
presumably would be for free since the reason the other 
alternatives are rejected in that EIS is that they cost too 
much, and so, I would think since that document is 
circulating and is dealing with the same issues, that it be 
an alternative in your document as well.
The sixth alternative that we would like to see 
studied is an increased storage alternative of about 2 
million acre-feet of water.  Now, obviously, I am not 
interested in the building of the Yuba Dam, but I do believe 
that to have a complete analysis of what methodology could 
be used to meet both public trust and water quantity and 
water quality objectives in the Delta, you cannot simply 
reject increased storage.
The seventh alternative  which I would like to see 
studied is no increased storage, but a Peripheral Canal 
capable of delivering the remaining 2 million acre-feet of 
water between the 2.1 million allocation to the State Water 
Project and the 4.2 million allocation to the State Water 
Project.
I think it is important to find out whether or not 
the Peripheral Canal really can be useful in meeting water 
quality standards in the Delta, and I don't see with the 
last 15 years of history how we can ignore the ability of 
the canal which has been promised by engineers for the 
purpose of dealing with water quality in the Delta.
The eighth alternative which I would like to see 
studied is the no-action alternative.  I find myself in 
agreement with Club FED on what that is, that the no-action 
alternative is D-1485 as amended by the Biological Opinions 
for the Delta smelt and the winter run.  I think that is the 
appropriate -- if it all falls through and if Newt Gingrich 
is not able to convince the rest of the Republicans that 
they are committing suicide, it may very well be that we do 
not have the Biological Opinions to run the Delta, but it 
seems to me that it would be worthwhile to analyze what the 
Board's walking away from it and leaving the individual 
regulations in effect would be.
The ninth alternative which I would like to see 
studied is no change in any water rights, no change in 
anybody's rights upstream of the Delta, simply the Board 
taking an active enforcement of the existing laws against 
unscreened diversions and illegal diversions.
Many of us who have been involved in this for a long 
time believe that there's between one and two million acre-
feet of water illegally diverted upstream of the Delta and 
that, in and of itself might resolve the water quality 
problems in the Delta without a change in anybody's water 
rights.
The tenth alternative I would like to see studied is 
no limitations of law of any kind and full Delta operation 
of the pumps, full capacity.  We are never going to know 
what improvements other alternatives can bring until we have 
a fuller knowledge of whether we need any new storage, 
whether we need any new diversions, whether we need a canal, 
until we study what the effects would be of running the full 
capacity of the pumps at the discretion of the projects.
The eleventh alternative which I would like to see 
studied is an alternative that would essentially leave the 
burden on the projects in the Delta in wet, above normal and 
normal water years only.  In drought years, in dry years and 
critically dry years, there would be a mechanism in which 
others would be required to pay only in drought years.
Upstream of the Delta, Bob Baiocchi has done an 
examination of storage and diversions, and our figures 
indicate that in a dry year if everyone contributed five 
percent of the water that they use, we would meet the total 
inflow requirements of the Delta in a dry year.  In a 
critically dry year it would cost ten percent.  
So, a suggestion for this alternative would be that 
nobody else contribute until we have a dry year or a 
critically dry year, and then the water be purchased if it 
is going to be taken to the pumps, but only in that 
circumstance.
The last alternative which we have for your 
suggestion comes in two parts.  It is the public trust 
alternative and I guess what I would like to describe is 
water that goes left and water that goes right.
I know from my work on the tributaries if all of the 
management plans that have been recommended biologically in 
your area of projects were to be ordered by this Board, you 
would have approximately a million and a half acre-feet of 
water in addition in the Delta.  You could do that for you 
have public trust authority to do that.
Now, the two alternatives are:  The water goes into 
the pumps and is no longer public trust water and is paid 
for by the ultimate receiver, from the person who had to 
release it upstream.  It is a transfer.  It does not 
recognize the concept of abandoned water since no one is 
going to abandon water willingly.  And to use the trust to 
reward the juniors and punish the seniors, it seems to me, 
to be using the trust for a purpose for which it does not 
exist.  But you should study that alternative.
Alternative 12-B, which is probably my favorite 
alternative, would be an alternative that says if you 
release public trust water in the tributaries, it is public 
trust water all the way to the Farallons and cannot be 
picked up.  That is a true public trust release of water 
since it is necessary that that water add to Delta outflow.
Now, these alternatives, we believe, in the EIR/EIS 
will make clear very quickly what the appropriate mechanisms 
should be and I would like to tell you what we think the 
result will be.
We think the result will be this:  We think there is 
enough water for everyone in California today.  We think we 
are going to have to conserve that water, but we think for 
30 years with no other appropriations, or storage, or canals 
or ponding, that proper management will result in sufficient 
water for all uses, including the trust.
But we want to see the EIR/EIS to make sure of that 
fact.
Now, in regard to question No. 7, are there 
additional actions necessary in the Bay-Delta watershed to 
implement the narrative salmon requirement to double natural 
production from the average production of 1967 to 1991?
Yes, there are, and they deal with the barriers.  
5937 requires that enough water be released from dams in 
order to keep fish below them in good condition, or it 
requires that you get the fish above the dams.
I think what you are going to find out is that your 
doubling can be done without tremendous water needs below 
every dam if you do an environmental document that looks at 
the following questions:  Are there barriers to spawning and 
rearing habitat for the races of salmon and steelhead above 
the Delta that can be removed without damage to water supply 
that will then aid in the doubling of the stocks; and the 
answer to that is yes.
There are operations.  There is the operation of 
Battle Creek.  You will find how that could work in Senator 
Hayden's petition to list the spring-run salmon.  
The removal of Setser Dam (phonetic) on Clear Creek, 
the removal of Englebright Dam on the Yuba River, a dam that 
I do not believe even has water rights and plays no water 
supply role whatsoever.
There are a number of other barrier questions that I 
think could provide a doubling of salmon and steelhead 
without your having to use everybody's water at maximum to 
do that.
Issue 8:  Which water rights in the Bay-Delta 
watershed should be subject to this water right decision?
I would like to read --
MR. CAFFREY:  Mr. Jackson, I just wanted to remind 
you you are down to one minute left.  Do you need more than 
the 20 minutes?
MR. JACKSON:  Maybe four minutes.
MR. CAFFREY:  We will give you five.
MR. JACKSON:  I would like to read to you from a case 
in which this question is asked, whose water rights --
MR. DEL PIERO:  What is the case?
MR. JACKSON:  This case is a case going on in 
Riverside County right now.  It was just decided.  I am 
going to read from the judge's decision:
The strict adherence to priority of right and a 
correlative right among water users of equal status creates 
uncertainty and potential economic consequences for those 
with a lower priority of use.  In view of the competing 
interests and the priority of use set forth in Water Code 
Section 106 an equitable apportionment of water is a 
solution which protects the riparian, overlying and junior 
users rights to a reasonable and beneficial use of water.
This case establishes or tends to establish equitable 
apportionment in order to protect the junior users of 
Southern California and it is going up, will be going up 
within the next 60 days.
So, I believe that you should do an alternative in 
your EIS to take a look at equitable apportionment since it 
may be the cutting edge of California law and would 
completely alter the priority system.
That is all I have.  Thank you very much.
MR. CAFFREY:  Thank you very much, Mr. Jackson.
Let's see if there are questions from Board members.
MR. DEL PIERO:  Do you have the citation for the 
case?  Is that the Mojave adjudication?
MR. JACKSON:  Actually, it is Riverside County Case 
No. 208-568 and the date of the decision is 9/11.
MR. DEL PIERO:  Thank you.
MR. CAFFREY:  Anything else from Board members?
Mr. Pettit.
MR. PETTIT:  Mr. Jackson, the one alternative that 
you mentioned involved the Department and the Bureau meeting 
the standards in all but dry and critically dry years.  You 
cited that in the dry and critically dry years other users 
would be expected to contribute, I gather, five or ten 
percent --
MR. JACKSON:  Of their storage and diversion.
MR. PETTIT:  Which storage and diversion?
MR. JACKSON:  All of the storage, and those who do 
not store, who do direct diversion would have the same 
applied to them.  Then they would know that that was the 
limit of what they had to contribute.  Everybody would know 
when they contributed and how they contributed, and I think 
you could get around the priority system by saying it was 
unreasonable not to reduce in drought years, but you have 
the drought as the trigger.
MR. PETTIT:  Do you plan to submit anything that 
would expand upon all of those alternatives for us?
MR. JACKSON:  I can if you would like, sir.
MR. PETTIT:  I think it would be helpful.  That one 
in particular I was interested in, how the five and ten 
percent was contributed.
MR. DEL PIERO:  That is sort of the emergency that 
was considered when we did D-1630.
MR. JACKSON:  Yes, sir.
MR. STUBCHAER:  In responding to Mr. Pettit's first 
question, I think the answer was a little different than you 
stated during your presentation.  You said five or ten 
percent of their use, and now you said their storage.
MR. JACKSON:  I said that wrong, sir.  The five and 
ten percent figure in dry years would mean an additional one 
million acre-feet of water.  In critically dry years it 
would mean two million acre-feet of water and it would 
require the release of five percent in dry years from 
storage and direct diversions upstream of the Delta.  The 
same philosophy but ten percent in critically dry years.
MR. STUBCHAER:  Is it five or ten percent of their 
right or what they are actually able to divert?
MR. JACKSON:  Their right.  We are going solely by 
the existing water rights -- oh, I see what you mean.  If 
they are in a dry year or a critically dry year, yes, that 
is the way we figured it, from what they had to release in 
those years.
MR. STUBCHAER:  So, if they had a 50 percent 
reduction in the amount of water available under their 
right, the five percent reduction would really be much 
greater than five percent on the water supply for that year?
MR. JACKSON:  Yes, sir.
MR. STUBCHAER:  Thank you.
MR. CAFFREY:  Other questions from the Board?
Anything from staff?
Mr. Jackson, thank you very much.  We appreciate your 
input.
All right, Mr. Godwin representing the San Joaquin 
Tributaries Association.
Good afternoon, sir, and welcome.
MR. GODWIN:  Good afternoon, Chairman Caffrey and 
members of the Board.
I am going to be brief.  We have already submitted a 
written statement on behalf of the San Joaquin Tributaries 
Association and its members, the Merced, Modesto, Turlock, 
Oakdale and South San Joaquin Irrigation Districts.
These comments were prepared in cooperation with the 
Friant Water Users and the San Joaquin River Exchange 
Contractors, who have also submitted their own separate 
statements.
Rather than going over each of the questions, I would 
like to just focus your attention on key issue No. 7.
The San Joaquin Tributaries Association is committed 
to putting together a package that we feel will meet the 
goal of doubling the natural production of chinook salmon in 
the San Joaquin River basin and we are cooperating with 
other interested agencies and with the Fish and Wildlife 
Service.
Attached to our comments is a copy of a draft 
recommendation that was put together by the San Joaquin 
Tributaries Association and submitted to the Fish and 
Wildlife Service on their doubling plan, and if you look 
through that, you will see that we have put together a list 
of recommendations, both near term actions and intermediate 
actions, that we feel will meet the goal of doubling the 
salmon.  
That was it.
MR. CAFFREY:  All right, sir.  Thank you, Mr. Godwin.
We will see if there are questions.
Anything from the Board?  Mr. Pettit?
Anything from staff? 
Thank you very much.
Oh, Mr. Howard.
MR. HOWARD:  I just had one quick question. 
Is it the recommendation of the San Joaquin 
Tributaries Association that the Board try to incorporate 
these recommendations for doubling into a water right 
decision?
MR. GODWIN:  No, we are recommending you put it into 
the water right decision, but we wanted you to be aware of 
what we are doing in an effort to meet the doubling of the 
chinook salmon in the basin.
MR. HOWARD:  Thank you.
MR. CAFFREY:  Thank you, Mr. Godwin.  We appreciate 
your being here.
Robert Meacher.  Mr. Meacher is County Supervisor 
from Plumas County.
MR. MEACHER:  Good afternoon, Mr. Chairman and 
members of the Board.
As you might recall, three weeks ago Supervisor 
Simpson was going to come down and testify.  As you probably 
know, he had a cerebral injury and passed away two weeks ago 
today.
MR. CAFFREY:  we are very sorry to hear that.
MR. MEACHER:  So, I am honored and I am saddened with 
the fact that we have lost such a great resource to the 
County and the State.  
The Board of Supervisors has asked me to try to fill 
in for Paul.
As a follow-up and you have a written statement from 
our board on several of the key issues, and essentially we 
agree with the Upstream Users in many of the key issues, but 
I am going to just hit some highlights on some areas where 
we differ, so I will be brief.
On key issue 8, of course,  we go right along with 
the Upstream Users and believe that the Central Valley 
Project and the State Water Project are the cause of the 
problems in the Bay-Delta Estuary and, therefore, they 
should be the ones that mitigate.
On key issue 9, we have some confusion.  I hope 
perhaps the Board could clarify that for us.  Essentially, 
Plumas County board feels it is imperative that your Board 
prepare a full EIR in connection with the water right 
decision and that mainly comes from a confusion on the 
comment period for the Water Quality Plan EIR; and is my 
understanding correct that you have extended that comment 
period?
MR. CAFFREY:  Would you care to answer that, Ms. 
Leidigh?  I am not sure I know the answer.
MS. LEIDIGH:  I think Mr. Pettit may have said 
something about extension of comments or exceptions to the 
future of comments.  It is not for the Water Quality Control 
Plan.  It would be for the EIR that we are preparing.
MR. PETTIT:  Mr. Chairman, this morning I mentioned 
several parties had asked for an extension of comments on 
the Notice of Preparation of the new environmental document 
that will be prepared.  We think this extension is 
appropriate.  We think that Notice of Preparation should be 
revised and I think that may be what Mr. Meacher is 
referring to.
MR. CAFFREY:  Does that help, sir?
MR. MEACHER:  Yes.  Our concern is that if the State 
Board chooses not to have an EIR in the water right 
decision-making process, that Plumas County would then 
respectfully request that these written comments today be 
included in the water quality EIR, therefore, giving us in 
the Sacramento system an equal opportunity in the process 
because we didn't get to submit comments in the water 
quality EIR.
Am I confusing everybody enough?
MR. CAFFREY:  I think there is some confusion.  The 
EIR is for the water right decision.  The plan has been 
passed and is in existence until the triennial review 
potentially three years from now --
MS. LEIDIGH:  It is really not possible at this point 
after the plan has been adopted to comment further on the 
environmental report for the plan because the plan has been 
adopted.  But at some point in the future the Board will be 
reviewing the plan again.
MR. MEACHER:  I guess our concern is that the Board 
will not have an EIR as part of the water rights process.
MS. LEIDIGH:  That is not what I said.  That is not 
an appropriate conclusion.
MR. CAFFREY:  That is an inappropriate conclusion.  I 
know what you are getting at, but go ahead.
MR. DEL PIERO:  Sir, is it your desire to have your 
comments incorporated into the comments for the water rights 
decision?
MR. MEACHER:  At this point, we don't know.
MR. DEL PIERO:  Let me suggest to you, sir, why don't 
you go ahead and proceed.  This is the appropriate time for 
you in terms of what you want to have in the EIR for the 
water rights decision.
MR. CAFFREY:  You go right ahead.
MR. DEL PIERO:  Hopefully, what you say now will be 
incorporated into the record and any question you have in 
terms of environmental review will be considered by this 
Board as part of the environmental impact support process 
for the water rights order.
MR. STUBCHAER:  And just to remove any doubt, you 
said you don't know if we are going to have an EIR for the 
water rights decision or not.
MR. MEACHER:  Right.
MR. STUBCHAER:  We are.
MR. MEACHER:  So that clarifies it.
MR. DEL PIERO:  You go right ahead and give us your 
presentation, and we will have it in the record and we will 
consider it.
MR. MEACHER:  Okay.  On key issue 9, I think the only 
difference between us, or addition that you already have 
from the Upstream Users on key issue 9 is that we request 
that urbanization of agricultural and forest lands in areas 
of origin and resulting habitat fragmentation due to 
inability to realize economic benefits from conservation of 
water and public trust values is an addition to key 9 of the 
Upstream Users.
I am trying to draw some correlations and differences 
between Plumas County and other Upstream Users at this 
point.  That is one of the potential significant 
environmental and economic effects.  Otherwise, we are in 
total agreement with the other Upstream Users.
Plumas County supports the Upstream Users' position 
and we must also, though, make strong exception to the Club 
FED and other agencies' ecological fair-share water rights 
position.
Plumas County is opposed to Club FED's position and 
has submitted comments that we feel better protect the 
public trust resources without sacrificing area of origin 
and senior water-right holders, and you can find our key 
issue 10 on page 3, and we can go into that some more.  
There is a large paragraph that goes into detail on that.
The Plumas County Board of Supervisors via Minute 
Order and appending Resolution as an area of origin, a State 
Water Project contractor county, requests that the State 
Board consider the water shortages as permanent and consider 
any EIR for the Water Quality Plan and/or water rights 
process the environmental and economic impacts of Section 
18(b) and declare the State Water Project complete at 2.1 
million acre-feet.
Plumas County will supply the supporting Minute Order 
and Resolution as an addendum to today's comments, and also, 
one other area where we differ from the Upstream Users, we 
would like to see the working groups, and that's in key 
issue 15 on page 6.  There's two listed but there's  
actually three that we would like to see, a watershed 
monitoring work group, a water transfer work group and a 
watershed management work group.
We believe, also, that the user-fee concept is 
paramount in any solution to the Upstream Users -- 
beneficiaries downstream.
That's it in a nutshell.
MR. CAFFREY:  Thank you very much, Mr. Meacher.
Questions from Board members of Mr. Meacher?
Anything from staff?
All right, thank you very much, sir.  We appreciate 
your being here and filling us in.
MR. MEACHER:  I wish Paul was here.
MR. CAFFREY:  I think we all do.  Very sorry to hear 
that very bad news.
All right, that takes us to Gary Bobker from the Bay 
Institute.
MR. BOBKER:  Thank you, Mr. Chairman and members.
My name is Gary Bobker.  I am Water Policy Analyst at 
the Bay Institute of San Francisco.
We will be submitting written comments to the staff, 
and so, I will, as usual, try to hit some of the high 
points, high and low points of the written comments.
I want to start off with, at the risk of repeating 
some remarks I made at the previous workshop, talking about 
the scope of the hearing and clarify some comments I made 
which I think may be misinterpreted by some people I talked 
with subsequently.
We had been critical of the proposed definition for 
the scope of the water rights decision, the four points that 
were mentioned in the workshop notice under the Notice of 
Preparation of Water Rights Decision EIR. 
We don't feel, given the current effort by Cal-Fed to 
develop a long-term Bay-Delta solution, that the Board at 
this point should be taking any kind of comprehensive long-
term planning effort.  That seems redundant and it could 
preclude options for the Cal-Fed effort.
However, obviously, the Board does have the authority 
to undertake that kind of effort and it does have 
obligations under the public trust doctrine and in other 
regards that must be dealt with during the water rights 
proceeding and it is neither its authority nor its 
obligation to limit it, but simply identify responsibility 
for achieving the requirements of the 1995 Water Quality 
Control Plan.  I think that's an important point to make 
because there are a number of areas where the Board needs to 
look at public trust protection throughout the whole 
watershed and how that affects the particular methodologies 
for implementing the 1995 Water Quality Control Plan.
So, I would describe the project in this case as 
being both identifying responsibility of water-rights 
holders to achieve those objectives in the plan as well as 
the obligation to insure that public trust resources are 
protected throughout the entire affected watershed.
That touches on a number of the key issues that have 
been raised and key issues 2 and 10 where the Board requests 
suggestions as to a particular methodology for assigning 
responsibility among water rights diverters throughout the 
San Joaquin and Sacramento watershed.
Again, we think that no matter what the different 
alternatives that are considered by the Board, that the 
public trust responsibilities, public trust context of those 
methodologies always be considered.
Whether the Board considers solutions as were 
suggested by some of the parties, and I would assume that 
would be regulated market-based solutions, whether the Board 
were to revise the direct requirements of upstream water-
right holders to meet the objectives of the 1995 Water 
Quality Control Plan, or whether the Board were to assign 
additional requirements in addition to the objectives in 
that plan in order to protect the public trust, in all cases 
in examining all those methodologies or approaches, the 
Board needs to, as much as possible, maximize the benefits 
to public trust resources throughout the watershed.
Particularly, obviously, as we look at how we meet 
Delta outflow and river-flow requirements in the 1995 plan, 
we should be maximizing the amount, timing of flows 
throughout the watershed, and that's particularly important 
with regard to key issue 7, the issue of achieving the 
narrative doubling objective for chinook salmon.
There's a very extensive record before this Board 
that predates most of the people in this room, except maybe 
Tom Zuckerman, I would like to point out that is compiled by 
the Fish and Wildlife Service.  The Department of Fish and 
Game suggests, very strongly suggests that the life history 
needs of chinook salmon would require more stringent 
protections than the direct requirements that are contained 
in the 1995 Water Quality Control Plan, and the plan you 
adopted, in fact, does reflect the uncertainty that the 
Board felt is inherent in whether that objective can be met 
through the direct requirements.
Therefore, I think the Board has an obligation, not 
just in its general public trust responsibility but in its 
responsibility to seek compliance with the narrative salmon 
doubling objective, to consider a number of actions.
First of all, as I said, giving weight to methodology 
for achieving the requirements of the '95 plan that, in 
fact, maximizes benefits to migrating chinook salmon; 
considering measures both in the Delta and upstream that 
would specifically be addressed to prevention of the 
extinction of the spring-run chinook salmon since it does 
not currently have the degree of protection that other 
salmon runs have.  
Very detailed recommendations have been made to the 
Board by NHI and others as to what the spring-run 
requirements are, and they should be carefully considered by 
the Board in considering further water rights actions, 
default system for funding habitat improvements that would 
benefit chinook salmon also, and I'll say more about that 
later.
And I think direction of the Cal-Fed coordinated 
Operations Group that the exercise of operational 
flexibility to vary export criteria should be used with the 
goal of helping to meet the doubling goal in mind and that 
should be an important component of the Ops Group thinking.
There are measures which perhaps would not take place 
within the context of this proceeding, such as conducting 
separate proceedings to reassess existing instream flow 
requirements for salmon protection on Central Valley 
tributaries of the Sacramento and San Joaquin as is being 
done for the Yuba and Mokelumne, and that's consistent with 
the directive in the Water Quality Plan, that the salmon 
doubling should be accomplished both through direct water 
quality protection in the Delta as well as other measures 
upstream.
A final component of implementing and achieving the 
narrative salmon doubling objective is, obviously, working 
to achieve the CVPIA goals, as several parties have 
commented earlier today.
CVPIA has directed the Fish and Wildlife Service to 
come up with an anadromous fish restoration plan, as we all 
know, and whether or not there are changes to the CVPIA in 
Congress, the salmon doubling goal remains a legal 
requirement of the State of California, so work done to 
develop an anadromous fish doubling plan, I think, is quite 
apropos for consideration by this Board, even absent changes 
to the CVPIA and assuming that the Fish and Wildlife Service 
and the Bureau proceed with implementation of the anadromous 
fish doubling plan, and discretion, of course, as to what 
degree that would apply to streams that were not under 
Federal control, so there is an important role for the Board 
to play in assessing what measures are necessary in a non-
Federal stream.
I would suggest that the Board request the Service 
and the Department of Fish and Game to work with the water 
rights holders and the public to make recommendations to 
this Board as to necessary measures to achieve salmon 
doubling throughout the Central Valley.
The Board could alternatively sponsor a series of 
workshops to accomplish the same thing.
With regard to key issue 11, we do not believe that 
the issue of consolidated points of diversion should be 
considered in this forum.  First of all, we don't think that 
it is appropriate as one of the main goals of the project, 
which is how it is defined in the workshop notice.  
Certainly, it might be one alternative to achieving those 
goals, but we don't think it is appropriate to consider it 
as an inherent goal in the implementation of the plan.
Also, we have a number of concerns, as we expressed 
at the April 18th hearing, on interim water rights actions 
for CVP and SWP permits about the potential effects of the 
use of consolidated points on the environmental baseline of 
the 1995 Water Quality Control Plan.  So, rather than 
consider that issue within this proceeding, we would suggest 
that, as was suggested at that hearing, that the coordinated 
operations group should evaluate the issue and then explore 
whether it is possible to make recommendations to the Board 
and others in a future proceeding as to whether consolidated 
points of diversion should be adopted and under what 
conditions they would be allowed.
Finally, in key issue 13, the Board has asked for 
suggestions as to actions to improve habitat conditions in 
the Bay-Delta watershed.  Some of them come to mind in terms 
of the actions necessary to achieve the narrative salmon 
doubling objective that I talked about at length and I won't 
go into again.
Some of them have to do with key issue 4, subject of 
the last workshop action as a recommendation to the drainage 
program and to improve the regulatory regime on the San 
Joaquin River.
The other component, I think, of habitat actions that 
are biologically associated with a water rights proceeding 
would be the default program to fund the recommendations to 
improve habitat conditions that are contained in the Water 
Quality Control Plan.
The so-called Category 3 program that was established 
by the Principles for Agreement is acknowledged as an 
important potential source of funding for habitat 
improvements in the Water Quality Control Plan, but at the 
same time, the Board also recognized that it was not clear 
whether or not that program would be funded or fully funded 
and, in fact, outside of the initial ten million dollars by 
Metropolitan Water District of Southern California, there 
has been no additional funding for that program in 1995.
We urge the Board to consider adoption of mechanisms 
to fund that program, including potentially fees on water 
users.  Such a fee wouldn't substitute for responsibility 
that this Board might lay on water users diverting from the 
watershed to meet the direct requirements of the plan, but 
would serve as a fall-back if the Category 3 program 
continues to be unfunded, and I think we all realize that.
While there are some difficult questions that need to 
be dealt with, and in dealing with the issue of how to best 
fund the Category 3 program, that we really cannot wait 
forever to do that, and I think the Board should be prepared 
for the eventuality that it will have to take some action.
I think that's all the major points I wanted to hit 
and the rest, as I said, I will make written comments 
available to the staff, probably tomorrow.
MR. CAFFREY:  Thank you, Mr. Bobker.
Are there questions from Board members?
Nothing at this point.
Mr. Pettit or staff?
All right, thank you, sir, we will look forward to 
your written material.  I presume you will provide copies 
for everybody.  Thank you very much, we appreciate your 
being here.
Joe Robinson representing the City of Sacramento.
Good afternoon, sir, and welcome.
MR. ROBINSON:  Mr. Chairman and members of the Board, 
the City appreciates the opportunity to submit these 
comments.
I am Joe Robinson. 
The City has submitted written comments on key issue 
No. 10 and I am just going to summarize the content of our 
written comments.
First, the City believes that the allocation of 
responsibility to meet water quality and flow requirements 
for the Bay-Delta Estuary must give proper consideration for 
the domestic and municipal use preferences to the priority 
doctrine and to California's area of origin statutes.
For this reason, it is our feeling that any 
alternative for obtaining water necessary to meet the Bay-
Delta Plan requirements from in-basin users such as the 
market-based approach or something else that has been 
suggested, must take into consideration the ultimate water 
supply needs of in-basin users and can't be based on the in-
basin users' current level of demand.
To accomplish this, it is our feeling junior 
appropriators, including water users who export water, 
should be required to demonstrate how they will meet their 
Bay-Delta flow requirements and their water supply needs in 
the future when water which is currently available for these 
purposes is needed to meet the increased water supply needs 
of in-basin users.
If this is not done now and if the resolution that 
accomplishes this is put off until some later time, then 
there will be no assurance in the future that an adequate 
supply of water will be available to meet the needs of all 
the water users without invading the area of origin rights 
as well as the priority doctrine.
The City also believes any allocation of 
responsibility among upstream diverters should correlate to 
the impact that each diverter has upon the resources of the 
Bay-Delta Estuary, rather than simply reflecting an across-
the-board allocation based on the amount of water diverted 
or stored.
In contrast to the obvious impact caused by water 
exports which directly reduce the amount of water available 
to the Bay-Delta, the amount of water diverted upstream for 
in-basin use is not an accurate measure of the impact that 
upstream users have upon the Bay-Delta because much of the 
water diverted from the Sacramento River and its tributaries 
for in-basin use is returned to the river before it enters 
the Bay-Delta Estuary.
For similar reasons upstream diverters should not be 
held responsible for providing flows simply in proportion to 
the capacity of storage reservoirs which are available to 
serve their diversions because there is not necessarily any 
direct correlation between upstream reservoir capacity and 
impacts on the Delta.
Finally, it is our belief that any allocation of 
responsibility for meeting Bay-Delta Plan requirements to 
upstream tributaries should be consistent with the relative 
priorities and contractual arrangements existing among 
diverters on such tributaries; and any such allocation 
should also take into consideration flow and other 
operational requirements which exist or are being developed 
at the local level to serve uses within such tributaries, 
including water supply and instream uses.
That concludes the summary of our comments.
MR. CAFFREY:  Thank you, Mr. Robinson.
Are there questions from Board members?  
Mr. Del Piero.
MR. DEL PIERO:  I have one.  How much water that the 
City diverts would be returned to the Sacramento?
MR. ROBINSON:  I believe we have a footnote in our 
comments that indicates that due to the use of groundwater 
throughout the City's entire place of use, the amount of 
water returned to the Sacramento River is greater than the 
City's surface water diversions.
Obviously, not all of the surface water diverted by 
the City is returned to the Sacramento River.
MR. DEL PIERO:  Can you quantify it?
MR. ROBINSON:  I don't know off the top of my head 
what that figure is.
MR. DEL PIERO:  Is that in your submission?
MR. ROBINSON:  It's probably in past submittals the 
City has made in this process.
MR. DEL PIERO:  I have heard that representation made 
repeatedly, but I have never seen a quantified number.
MR. ROBINSON:  We could provide that information, and 
basically, it's based on the place of use for the City, not 
just the City's --
MR. DEL PIERO:  It probably would be helpful.  Given 
the argument that the City is putting forth, it would be 
helpful to prove out this point.
MR. ROBINSON:  Certainly, we can provide that 
information.
MR. BROWN:  I think it is 150,000 acre-feet a year.
MR. DEL PIERO:  That is consumed?
MR. BROWN:  That is returned.
MR. DEL PIERO:  Do you know how much is diverted?
MR. ROBINSON:  I can answer that.  We currently 
divert anywhere from 90 to 100 thousand acre-feet of surface 
water.  
MR. DEL PIERO:  Has a groundwater that you pump, for 
my edification, declined in static levels?
MR. ROBINSON:  Actually, the groundwater pumping that 
I referred to is not just the City because primarily we pump 
groundwater in the north area, also the other water 
purveyors within our place of use, many of whom rely 
substantially upon groundwater pumping.
I think there are some areas where the groundwater 
level is declining, but we have to get more technical people 
up to get a good response to that.
MR. CAFFREY:  Anything else from Board members?
Anything from staff?
Mr. Robinson, thank you, sir.
MR. ROBINSON:  Thank you very much.
MR. CAFFREY:  That will then take us to a panel 
presentation from the Joint California Water Users and the 
names I have are Kevin Haroff, James Roberts, Cliff Schulz, 
Tom Berliner, and this, I understand, to be a two-pronged 
attack.  Mr. Schulz, is this part of your panel?  You have 
other names, Byron Buck, Steve Macaulay and others.  Is this 
all part of the same presentation?
MR. SCHULZ:  We are going to make a general 
presentation for the Joint Water Users and they will make 
some short independent presentations by members of the Joint 
Water Users.
MR. CAFFREY:  And then, Richard Denton has a separate 
card, but does he want to follow immediately after you?
MR. SCHULZ:  Yes, he should for Contra Costa.
MR. CAFFREY:  Well, without objection, we will move 
Mr. Denton back a couple of cards so we can have some 
continuity in the presentation.
Do you gentlemen wish to begin.
MR. HAROFF:  Mr. Berliner is not able to attend at 
this point.
MR. SCHULZ:  We think he is on the phone out in the 
hall.
MR. CAFFREY:  Why don't you begin.
MR. HAROFF:  Mr. Chairman, my name is Kevin Haroff.  
I am an attorney with Morrison & Foerster, which is counsel 
to the Santa Clara Valley Water District.
As you mentioned, with me at the table, at least for 
the time being are Cliff Schulz, who represents the Kern 
County Water Agency; and Mr. James Roberts, who is with the 
Metropolitan Water District of Southern California.
I am going to make a brief statement summarizing some 
written materials that we submitted earlier today which 
respond to each of the key issues 7 through 15, which you 
identified in the workshop notice would be considered today.
I would like to note that the agencies that have 
participated in the preparation of the Joint Water Users 
comments include members of the California Urban Water 
Agencies, the State Water Contractors, and Westlands Water 
District.
As we noted, CUWA and the State Water Contractors, as 
well as some of the individual agencies that have 
contributed to our joint statement, will be making separate 
statements following our panel presentation, and I would 
like to note that nothing we say here should be construed to 
limit the scope or substance of individual comments, except 
Mr. Berliner since he is not in the room right now.
MR. CAFFREY:  I need to ask you, this is all going to 
take place in the 20-minute time frame?  Is that the plan, 
this is all one?
MR. HAROFF:  What we would like to do, if we can ask 
your indulgence, we will probably take up our 20 minutes 
with our panel and then because the other organizations and 
agencies will have separate submissions, they will be using 
their separate allocations of time.  We will all work hard.
MR. CAFFREY:  It says Mr. Macaulay and then it says 
others.  Are you saying each of those want 20 minutes?
MR. SCHULZ:  No, I think we can confirm that because 
of the panel presentation, their presentation will be much 
shorter than they otherwise would be, I think two or three 
minutes.
MR. CAFFREY:  Which in the final analysis will save 
us all time; is that correct?
MR. SCHULZ:  Yes. 
MR. HAROFF:  We hope they will all say we agree.
MR. CAFFREY:  We are just trying to get a feel for 
how much time we need to take this afternoon.
Go ahead.
MR. HAROFF:  What I would like to do is go through 
each of the key issues that are the subject of today's 
proceeding.
Issue No. 7  -- we believe the purpose of these 
proceedings is to develop a water right decision that 
identifies the responsibility of water-right holders in the 
Bay-Delta watershed, to achieve the flow operational and 
water quality requirements of the Bay-Delta Plan.
Assuming that some measures other than those 
described in the Water Quality Control Plan will be 
necessary to achieve the narrative requirement for salmon 
protection, such measures appropriately would be the subject 
of other proceedings.
On the other hand, the Board must also keep in mind 
that its regulatory authority extends to other activities 
that have an impact on natural chinook salmon production and 
the exercise of this authority in the context of other 
proceedings is entirely appropriate.
Moreover, the Board should remember that non-flow 
activities such as the Category 3 process, CVPIA restoration 
activities, the State and Federal export pumps, fish 
protection agreements and the measures identified in Chapter 
4 of the Bay-Delta Plan, which is a program of 
implementation, are also available to contribute towards 
meeting the objective for salmon without action by the Board 
in these proceedings.
On issue No. 8, the State Board should consider all 
water users, both large and small, whose activities may 
impact protected uses.  This community of water users 
includes both those within and upstream of the Delta as well 
as in the export areas, and also includes the holder of pre-
1914 water rights and riparian water rights.
You will note that our presentation is somewhat of a 
counterpoint to some of the presentations you have heard 
earlier this morning.  It is our view that all water users 
of water from the watershed may share responsibility for the 
biological decline to the Bay-Delta and all such uses 
should, therefore, share responsibility for mitigating the 
impacts of their respective uses.
Nevertheless, while the State Board has the authority 
to regulate all diverters of water from the Bay-Delta 
watershed, the Joint Water Users recognize the practical 
problems of attempting to deal with hundreds, or possibly 
thousands of small diversions.  The Joint Water Users, 
therefore, agree that a minimum diversion and storage 
threshold is appropriate.
In order to fairly allocate responsibility for Bay-
Delta protection, the State Board should establish this 
threshold at a level that will result in the inclusion of at 
least 90 percent of the water use in the Bay-Delta 
watershed.  Thus, the State Board's proposal to include all 
users of greater than three cfs or with storage rights 
greater than 200 acre-feet is appropriate if it meets this 
90 percent threshold.
Issue 9:  While this issue focuses on potentially 
significant environmental and economic effects of 
alternative allocation methodology, the Joint Water Users 
believe that the environmental and economic issues which the 
State Board must examine will not be limited to those 
associated with an allocation decision.
The Joint Water Users believe that key issue No. 9 is 
too narrowly focused when it referred only to the Bay-Delta 
watershed.  There are many areas of the State that are not 
located within the watershed of the Bay-Delta, but that 
could be environmentally or economically affected by the 
State Board's decisions, including the service areas of most 
of the Joint Water Users.
The State Board should expand its focus to cover 
impacts within all areas of the State which rely on water 
from the Bay-Delta watershed.
In addition, the State Board should address the broad 
range of economic and environmental issues that may be 
raised by any adopted allocation methodology.  
We have noted in our written comments a number of 
examples of potential economic and environmental issues that 
should be considered in this context.  
As the State Board and interested parties identify 
possible allocation alternatives through the workshop 
process, it will be possible to focus more precisely on what 
potential impacts need to be addressed.
Issue No. 10:  As the Joint Water Users have stated 
on several occasions, in the absence of a negotiated 
settlement among the major water users, the task of 
allocating responsibility for meeting Bay-Delta flow and 
water quality objectives through the State Board hearing 
process will be difficult at best.  
The State Board must plan for the contingency that 
negotiations are not successful, however, and we are 
responding to issue No. 10 from that perspective.  
The most important task of the State Board in any 
allocation of responsibility will be to apply the rules of 
California law to allocate the responsibility of each of the 
identified users for meeting the Bay-Delta flow and water 
quality objectives.  That determination should respect 
certain fundamental principles that must apply in any 
allocation of responsibility.  
Most significantly, while we recognize that certain 
in-basin water rights are senior to the State Water Project 
and the Central Valley Project, all in-basin water rights 
are subject to the reasonableness requirements established 
by Article X, Section 2 of the California Constitution, the 
public trust doctrine, and other requirements of California 
law.
From that perspective, we believe that any allocation 
should reflect the following points:
First, all uses of water must conform to Article X, 
Section 2 of the State Constitution and the standards of 
reasonable use, method of use and method of diversion 
articulated in that section.
Second, all diverters, regardless of seniority, are 
subject to the continuing jurisdiction of the State Board to 
review water rights pursuant to the requirements of Article 
X, Section 2 of the California Constitution and the public 
trust doctrine.
Third, all water users, regardless of seniority or 
priority, have an obligation to use either best management 
or agriculturally efficient water management practices to 
assure that their use, method of use and method of diversion 
are reasonable within the meaning of the California 
Constitution.
Fourth, all diverters, regardless of seniority, are 
required to endure some inconvenience and incur reasonable 
expense in order to comply with the constitutional mandate 
to maximize the reasonable and beneficial use of water.
Fifth, depletions of storage releases that are being 
made to meet Bay-Delta standards should not be allowed where 
the attainment of standards is thereby threatened.
In addition to these points, the Joint Water Users 
believe that the county of origin and watershed of origin 
laws do not alter the obligations of in-basin users subject 
to the State Board's authority to allocate responsibility 
for meeting Bay-Delta standards.  Other than confirming a 
temporal priority as against the projects, these laws have 
no direct effect on the State Board's authority to allocate 
responsibility.  They only affect the priority of water 
rights applications that otherwise would be junior in time 
to the rights of the Central Valley Project and the State 
Water Project.
After the State Board issues a water rights permit 
pursuant to such an application, the permit is subject to 
Article X, Section 2, reasonableness requirements, public 
trust obligations and other public welfare considerations 
applicable to any appropriative water user.
Applying these principles, the Joint Water Users 
encourage the State Board to adopt a balanced approach in 
any determination of responsibility for compliance with 
standards in the Bay-Delta watershed.  To that end, the 
Joint Water Users encourage the State Board to conduct 
workshops specifically to consider alternative methods of 
allocation in which all water users share responsibility for 
compliance with the applicable standards based on the 
principles we have just described.
An early workshop should involve cataloging each 
water user's contribution to the total reductions in Delta 
inflow and outflow.  This would involve an accounting of all 
diversions and use of water probably on a monthly time-step 
basis.  This will be a time-consuming process and the Joint 
Water Users, therefore, believe that the necessary work must 
begin soon.
Finally, while negotiation among the parties may 
obviate the need to reach an allocation in a formal water 
rights proceeding, it is important that all parties 
understand as early as possible how such an allocation would 
be undertaken to allow full and effective participation    
in any formal proceedings in the event negotiations are not 
successful.
Issue No. 11:  The Joint Water Users encourage the 
State Board to consider allowing increases in combined State 
Water Project and Central Valley Project rates of diversion 
beyond those authorized in existing permit conditions, 
provided that such increases would not result in non-
compliance with standards contained in the Bay-Delta Plan 
and could be carried out without injury to legal users of 
water.
To the extent that additional impacts may result, 
including, for example, potential impacts to fisheries on 
upstream tributaries, additional environmental review may be 
necessary.  Nevertheless, the Joint Water Users believe that 
those adopted standards will achieve the environmental 
objectives for the Bay-Delta, at least on an interim basis, 
and that so long as the combined points of diversion can be 
operated consistent with the plan, allowing increased 
diversions to benefit south of Delta water users may be 
warranted.
Issue No. 12, the no-action alternative:  State CEQA 
guidelines provide that the no-project alternative shall 
address existing conditions as well as what would reasonably 
be expected to occur in the foreseeable future if the 
project were not approved based on current plans and 
consistent with available infrastructure and community 
services.
The Joint Water Users believe, consistent with this 
directive, that the no-action alternative for this analysis 
should include the conditions imposed by D-1485, the 1995 
Biological Opinions for winter-run chinook salmon and Delta 
smelt, and to a limited degree the conditions imposed by the 
CVPIA.
The reason for the limitation on consideration of 
CVPIA conditions is that only certain provisions of the 
CVPIA have been implemented.  The implementation of other 
provisions is the subject of ongoing analysis as part of the 
Bureau of Reclamation's preparation of its programmatic 
Environmental Impact Statement, and therefore, it is not 
feasible to describe what would be reasonably expected to 
occur as to these provisions.
Issue No. 13:  The Joint Water Users believe that the 
current proceedings should be limited to the development of 
appropriate terms and conditions for inclusion in water 
rights permits before the State Board; thus, although a 
number of actions can be taken and in several important 
instances are being undertaken to improve habitat conditions 
in the Bay-Delta, and although the State Board does possess 
broad authority over riparian and pre-1914 users as well as 
appropriative permit holders, the exercise of such authority 
to improve habitat should take place outside the context of 
the water rights process now under way.
From that perspective, the Joint Water Users believe 
a number of opportunities are available for State Board 
involvement.  Many of those opportunities were identified 
previously in CUWA's August, 1994, recommendations for a 
comprehensive Bay-Delta ecosystem protection plan as well as 
in the November, 1994, CUWA/Ag proposals that were 
incorporated by reference in the December 15 Principles for 
Agreement.
Those include proposals regarding screening 
unscreened diversions, waste discharge control and pollution 
prevention, legal fishing, illegal fishing, land-derived 
salts, control of exotic species, restoration of riparian, 
wetland and estuarine habitat and control of channel 
alterations.
Some of these actions were addressed in the Bay-Delta 
Water Quality Control Plan and we would encourage 
appropriate follow-up on those actions by responsible 
agencies.  Others are being considered by the Category 3 
process that was initiated earlier this year to address non-
flow factors affecting the Bay-Delta.
Several members of the Joint Water Users are active 
participants in the Category 3 process.
The State Board should support these efforts as an 
important adjunct to its implementation of the Bay-Delta 
Plan.
Briefly, issues 14 and 15 on monitoring -- the Joint 
Water Users and representatives of the Interagency 
Ecological Program for the Sacramento-San Joaquin estuary 
have been meeting to develop a more comprehensive, 
coordinated, responsive and fiscally responsible monitoring 
and study program for the Bay-Delta system.
The approach to data collection and evaluation that 
has evolved through this process divides the total 
monitoring and study effort into three broad categories; 
long-term monitoring, special studies and applied research.
Each one of those categories are described in some 
detail in our written submission and I don't intend to 
repeat that here.  I would like to note, however, that these 
efforts described in our written submission are very much in 
their formative stage and need maximum flexibility if they 
are to proceed.
The Joint Water Users, therefore, believe that any 
monitoring and study requirements mandated by the State 
Board should be limited to compliance monitoring of those 
stations and constituents that are needed to determine 
whether regulated parties are complying with the terms and 
conditions of their water rights permits.
The Board can require IEP annual reporting for the 
biological monitoring and studies, and it should continue to 
have its staff as an IEP member to monitor the nature and 
effectiveness of these programs.
Finally, issue 15:  The Joint Water Users do not 
believe it is necessary to establish work groups to aid in 
evaluating issues with plan implementation.  Considerable 
progress on many of these issues already is being realized 
through informal negotiations and technical work.  As it has 
in the past, the State Board should encourage those efforts 
and facilitate the exchange of information through the 
workshop process.
That concludes our comments.  
Cliff, you have one or two statements you would like 
to make?
MR. SCHULZ:  Right.  On page 4 of our statement there 
is a footnote which is really only applicable to the 
agricultural members of our group, and I just wanted to 
bring it to the Board's attention that EPA and your staff 
and others have been working on agricultural economic 
studies, and the agricultural members of the Joint Water 
Users have a great deal of concern with the methodologies 
that are being considered in that group.
And I believe the Board has some staff members that 
possibly attend those meetings, so we are very interested in 
having some other type of dialogue take part through this 
workshop process on the proper way of evaluating any 
agricultural economics.
MR. DEL PIERO:  Are you suggesting it is bad 
economics?
MR. SCHULZ:  I would never say -- never mind.
MR. DEL PIERO:  I am being facetious.
MR. SCHULZ:  I thought I had better stop, too.
MR. CAFFREY:  Are you suggesting that we have a 
workshop?
MR. SCHULZ:  One of the work groups that worked 
fairly well was the agricultural work group.  Whether a work 
group is necessary, I don't think it is, but I suggest a 
possible workshop in that area might be useful down the 
line.
MR. CAFFREY:  It is something you feel you could have 
further discussion on in the work group first, or is that in 
your mind not fruitful?
MR. SCHULZ:  That probably is the right place to 
start.
MR. BROWN:  Cliff, are you concerned with the crop 
payment capacity analysis or --
MR. SCHULZ:  No, I continue to be concerned with not 
bringing it down to the district level and continuing to 
still treat California agriculture as if it were one big 
farm with the maximum flexibility of crop shifting, just 
sort of a black-box approach to what happens in the real 
world with farming in California.
MR. BROWN:  Markets and soils?
MR. SCHULZ:  Markets and soils, and equipment and 
technology, and institutional limits on swapping water and 
the whole complex area at the legal institution end.
MR. BROWN:  Could be a workshop?
MR. CAFFREY:  It's certainly a possibility.
MR. DEL PIERO:  Have they developed their modeling 
that they are using?
MR. SCHULZ:  To some extent, they have.
MR. DEL PIERO:  So it is not complete then?
MR. SCHULZ:  It is not complete.  One of my problems 
is that the Department of Water Resources is involved in it 
and I keep scratching my head and asking them why.  
The only other point I want to make --
MR. CAFFREY:  Mr. Anderson, we will ask him.
MR. SCHULZ:  Mr. Del Piero, you asked a question to, 
I believe, Mr. Anderson about the monitoring activity and 
the sharing of cost which they had recommended in their 
paper and he suggested that you ask us or somebody from the 
Upstream Groups, and the point I just wanted to make quickly 
is that no, that has not yet been the subject of any 
negotiations between the Joint Water Users and the Upstream 
Users, but we support the concept which Mr. Anderson made in 
that paper, so now it is.
MR. CAFFREY:  Ms. Forster.
MS. FORSTER:  I sense a shift from some of the 
dialogue or testimony given during the Water Quality Plan 
and the comment that your group just presented, and I am a 
little confused as to who is overseeing Category 3.
MR. HAROFF:  Who is overseeing Category 3?  I'm sure 
Gary's people may take responsibility for that.
MR. ROBERTS:  There is a Category 3 steering 
committee.  It is made up, I believe, of 18 policy-level-
type people from water users, Cal-Fed and environmental 
groups, and that is the group that is overseeing that.  It 
is a relatively informal group, but they are meeting fairly 
regularly and trying to put the program together, and 
there's staff level support from participating agencies as 
well.
MS. FORSTER:  Did I misunderstand you?  Did you say 
earlier in your testimony all these things are available 
without any action by the Board?  I thought Category 3 was 
sort of a centerpiece of the whole solution to the Water 
Quality Plan, and maybe I misunderstood your comments, but 
all of a sudden I feel like you are asking that that go out 
into a place by itself and that we just look at the water 
rights, and I thought we were doing a bigger picture.
Maybe I am just not understanding what you are 
saying.
MR. SCHULZ:  Let me give this a shot.  We have tried 
in our paper and our presentation to make a distinction as 
to what we think you should be doing in these water rights 
hearings and we haven't been saying you shouldn't do 
anything else, but we have been trying to draw a procedural 
distinction because we think in the water rights proceeding 
you are going to be putting terms and conditions into water 
rights permits.
To the extent you are dealing with pollution control 
mechanisms or screening, we thought it would be more 
appropriate to do those in a separate proceeding from these 
water rights proceedings.
MR. DEL PIERO:  What jurisdictional authority does 
the Board have to do that?
MR. SCHULZ:  We think on screening you probably have 
Article X, Section 2 authority for unreasonable method of 
diversion.
MR. DEL PIERO:  Against whom?
MR. SCHULZ:  Against an unscreened diversion.  We 
believe, of course, in the water quality field the Regional 
Board or the State Board have the authority to do all sorts 
of things, obviously, under the Clean Water Act and the 
Porter-Cologne.
MR. DEL PIERO:  And I am trying to understand.  The 
direct relation is we don't take in all those people who are 
diverting less than three cfs.  Yes, maybe it is the vast 
majority of those people that have unscreened diversions are 
those folks, so you are asking us to duplicate the process 
after the initial water rights proceeding is over?
MR. SCHULZ:  I think we have taken sort of a 
practical stance.  If you pick up 90 percent of the water 
diverted, that there will be a major benefit.  If you decide 
later you want to go to even those smaller diverters that 
perhaps only constitute 10 percent of the total water 
diversions, that may be possible.
But given the additional benefits of trying to bring 
in those smaller diverters, vis-a-vis the complexity that it 
would probably add to the process, we figured using the 90 
percent rule was a good way to go.
MS. FORSTER:  Well, this conversation has helped me 
answer my own question.  You clarified it.  I got a little 
confused.  It gets a little complex, but I understand.
MR. CAFFREY:  Let me note that Mr. Berliner has 
joined us and has been with us for some time.
Tom, do you wish to disavow from this panel or --
MR. BERLINER:  If these questions continue on.
MR. CAFFREY:  I thought you were being very careful.  
You are up there at the other side of the room.
This completes their section but they have individual 
presenters that just want to get up and speak for two or 
three minutes each.
MR. DEL PIERO:  I have another question.
I guess the question is of you since you made the 
bulk of the presentation.
During the course of the presentation you articulated 
support, for lack of a more definitive term, of the equitable 
apportionment of responsibility for resolving the water 
quality problems and in terms of implementing that through water 
rights.
MR. HAROFF:  I think we were trying to be careful.
MR. DEL PIERO:  I'm not being anywhere near as 
careful as you were.  At least I think generally that 
concept is what I heard.
Is that more or less the case?
MR. HAROFF:  What we were attempting to do is 
summarize what we believe is the current state of the law 
relative to the allocation process.  We were not in this 
process attempting to suggest any specific allocation.
I will note, though, you may be hearing further on 
that issue from some subsequent participants.
MR. DEL PIERO:  Fine.  I will wait for the next man 
to get up and talk.
Additionally, you felt that there should be no 
impediment to increased appropriations under the Delta by 
changing the diversion.
MR. HAROFF:  I believe what we said is we think that 
may be an appropriate thing to do provided increased rates 
of diversion do not result in a evaluation of adopted Bay-
Delta standards.
MR. DEL PIERO:  Let me ask this question.  I am 
struggling here, not with you, but I am struggling with 
everybody who talks about this supposed concept of something 
other than strict priority right.
How can one make an argument to allow continuing 
appropriations pursuant to a junior appropriative right if 
senior appropriative rights are being requested to 
contribute water to remedy existing environmental problems?
MR. HAROFF:  I don't think anything in our 
presentation should be taken to suggest that an important 
part of what needs to be considered in any allocation are 
existing legal priorities.  I think that's consistent with 
what we have stated in our description.
On the other hand, we do think it is also important 
consideration of legal priorities must be undertaken within 
the context of the reasonableness requirements of the State 
Constitution as well as other applicable provisions of State 
law.
MR. DEL PIERO:  I'm sorry, I don't understand, and I 
do understand the reasonable provision of the Constitution.
Can you explain to me -- I am having difficulty 
gripping this concept.  
We will use the State.  The State takes what, two 
million acre-feet a year, something like that, the State 
project?
MR. SCHULZ:  2.1, 2.2 million.
MR. DEL PIERO:  That's close enough.  The total water 
right is like four million acre-feet, 4.2.  I've heard a 
number of people today here say that all water-rights 
holders ought to be held responsible for contributing to the 
solution, yet the representation here is also that 
additional water over and above the maximum amount taken by 
the projects should be allowed to be taken from the joint 
points of diversion over and above what they have taken in 
the past.
I am having difficulty conceptualizing how even in 
the context of an equitable apportionment that is equitable.
MR. SCHULZ:  I think it is a time issue.  We are not 
thinking these kinds of additional diversions would occur 
during the months of June, July and August when the Delta 
and the whole system is in a water-shortage situation, but 
the joint points of diversion in some Januarys, Februarys 
and March, when the full need of in-basin users are being 
met, could allow for some additional water to be diverted, 
say, for example, in a situation, because of the increased 
conveyance capacity of the State Water Project canals, their 
share of San Luis Reservoir is full and there is surplus 
outflow in the Delta, and the Tracy pumping plant is still 
trying to fill its share, and you could add to the 4200 
diversion at Tracy some from Banks in order to get San Luis 
full in a period of surplus.  
So, those kinds of things might occur.  I don't think 
we see them as being in a situation where there's been 
cutbacks to the in-basin diversions, say, during the summer 
months.
MR. DEL PIERO:  So that concept would sort of set, 
and again, forgive me for trying to conceptualize it, but 
when we're talking about trying to set up a real-time 
monitoring system in terms of water availability that 
assumes the reservoirs as natural features, or discount it 
from the water available in the system?
MR. SCHULZ:  On the question, I think, on a real 
time, yes, that is what we are assuming and to a great 
extent that occurs now in the operation of the projects in 
deciding how much water can be diverted.
MR. DEL PIERO:  But the storage is excluded from the 
equation.  Everybody's storage is excluded from the equation 
except in the summertime. 
Is that what you are talking about?
MR. SCHULZ:  I can make a mistake on this one, but my 
guess is that usually occurs in situations where you are 
storing all you can and there's still surplus flows.  That's 
going to be at least the most normal situation.  It's going 
to natural flow diversions, not releases from storage, at 
least most of the time.  
I think I am right.
MR. BROWN:  You are talking about the winter months 
diversion out of the Delta?
MR. SCHULZ:  And spring snowmelt.
MR. BROWN:  Wasn't there an estimate at a previous 
workshop where that figure, though, might be around 30,000 
acre-feet?  It is not a big figure.
MR. SCHULZ:  I remember that work that was in the   
D-1485 modification hearing.  I don't remember under what 
assumptions that was, and what we have always felt as part 
of this proceeding where you are to be doing a full-blown 
EIR on those kinds of issues, and we can do the studies and 
we will find out what those are, but we think it is 
appropriately part of this process.
MR. CAFFREY:  Anything else from the Board?  
Anything from staff?
MR. DEL PIERO:  There's all kinds of questions, Mr. 
Chairman, but I am not going to take your time now.
MR. CAFFREY:  I would just point out to Mr. Del Piero 
and the rest of my fellow Board members and those of you who 
are here, there are a lot of questions but we obviously 
don't have all the answers.  If we had them, we wouldn't be 
going through this process.
I don't know how far we need to take the depth of 
questions in this proceeding other than the fact that as far 
as we have taken it, it gives you an idea of what is on the 
mind of some of the Board members, Mr. Schulz and the other 
gentleman.
MR. HAROFF:  Mr. Chairman, I think we would hope this 
issue would be something that the Board would continue to 
focus on in additional proceedings in the future.
MR. CAFFREY:  And we hope we have a process that 
would allow us to flush these issues out and get some of 
these answers, or at least get opinions.
MR. HAROFF:  Of which there are many.
MR. CAFFREY:  Hopefully, eventually answers.
Then, with that, I think it is probably appropriate 
to go to the other folks that wish to speak very briefly.
Mr. Berliner, did you wish to be among the group of 
short presentations or --
MR. BERLINER:  Yes. 
MR. CAFFREY:  Shall we start with you since --
MR. HAROFF:  I think we suggested an order that would 
have Mr. Buck from CUWA.
MR. CAFFREY:  Okay.  Since Mr. Berliner was 
originally part of your panel, we were going to him next, 
but that's fine.  
Will somebody let me know when it is Tom's turn since 
I have, obviously, lost control of the proceeding.
All right, Mr. Buck.  We will give each of these 
speakers what, Mr. Stubchaer, four minutes?
MR. STUBCHAER:  Four minutes.
MR. CAFFREY:  Any more than four minutes, please let 
us know with ample justification why.
MR. BUCK:  Good afternoon, Mr. Chairman and members. 
My name is Byron Buck, Executive Director for the 
California Urban Water Agencies.  
CUWA, as you know, represents the 11 largest urban 
water agencies serving over 20 million consumers and three-
quarters of the State's economic activity.
CUWA has participated in the Joint Water Users 
comments which you have just heard.  In preparation of these 
comments, CUWA determined that it needed to reaffirm, in a 
separate statement, its comments made to the Board August 
25, 1994, regarding allocation of responsibility for meeting 
Bay-Delta standards in response to key issue 10.
This position is consistent with and in furtherance 
of the legal principles outlined in the Joint Water Users 
statement addressing this key issue.
CUWA, at that time offered a three-step process that; 
first, in addressing outfall requirements, for example, a 
rough estimate of each user's share of the cumulative 
impacts of the diversion and use of water would be 
determined based upon that user's proportionate share of 
total depletions from the unimpaired flow to and through the 
Delta. Other methods to determine this base impact also may 
be reasonable.
Second, the base impact of each user would be 
specifically reviewed to determine whether it is reasonable 
and in the public interest.  A range of factors would be 
considered that could increase or decrease the user's 
responsibility.
Ideally, some objective criteria could be developed 
to rate these factors; however, because of the wide variety 
of water users and variables that affect the reasonableness 
of use, some policy judgment would be required.  The factors 
that could be considered in this context include, without 
limitation:
The water user's seniority;
The water user's priority;
Whether the user practices appropriate water 
management such as conservation, reclamation, drought 
management planning and good groundwater management;
Other specific impacts associated with the user's 
diversion and use such as entrainment, reverse flows, effect 
on timing and temperature, and polluted return flows;
And finally, the population or economic activities 
supported by the use.
Third, after a water user's responsibility has been 
so determined it may still be unreasonable due to special 
circumstances, to require that user to meet its 
responsibility exclusively by surrendering a portion of its 
water supply.  Therefore, a program would be developed to 
allow a user to establish mitigation credits as appropriate 
to be used in lieu of directly meeting its obligations 
determined by the State Board.
That concludes the reiteration of our statement of 
August.  
We appreciate the opportunity to appear before the 
Board and would be happy to answer any questions.
MR. CAFFREY:  Questions of Mr. Buck?
Mr. Pettit.
MR. PETTIT:  Mr. Buck, how do you distinguish between 
seniority and priority as you use it in this statement?
MR. BUCK:  Seniority would be, obviously, the water 
right.  Priority would be the type of use as a 
consideration.
MR. PETTIT:  Ag as opposed to municipal?
MR. BUCK:  Right.  We are not necessarily saying in 
each case ag and municipal would have a different one.  You 
would have to look at the specific circumstances of those 
uses, whether they are applying best management practices 
and so forth.
MR. PETTIT:  Thank you.
MR. CAFFREY:  Anything else from the Board members?
Mr. Del Piero.
MR. DEL PIERO:  The concept of mitigation credit, can 
you articulate that to a greater extent for me?
MR. BUCK:  What a special circumstance would be in 
that case -- I think you could argue one where under the 
allocation process they come up with, you might have an 
urban area that was extremely short of water and you are 
going to have a very severe economic impact, they would be 
allowed to go into the system, establish mitigation credit 
that would provide water and the same benefit from another 
location so that they could mitigate both their economic 
impact, yet provide for the environment as the Board would 
indicate.
Tom, did you want to elaborate on that at all?
MR. BERLINER:  I will when I get up.
MR. CAFFREY:  Ms. Forster.
MS. FORSTER:  The example you just gave, do you mean 
a water transfer?  What does that mean, what you just said?
MR. BUCK:  Essentially it would be a water transfer 
and it wouldn't necessarily have to be water for water 
quality, but in most cases it would.  You would make sure 
that water showed up in the Delta at the point the Board 
desired it, but it was purchased from another source and 
didn't necessarily come from that person whose water rights 
were affected.
MS. FORSTER:  That is why San Francisco is tough 
about that.
MR. BUCK:  Yes. 
MR. CAFFREY:  Thank you, Mr. Buck.
Steve Macaulay.
MR. MACAULAY:  Thanks very much and good afternoon, 
Mr. Chairman and members of the Board.
The State Water Contractors appeared before you on 
August 29 and presented extensive and lengthy comments 
regarding key issues 1 through 6.  
In preparation for today's workshop, the State Water 
Contractors, as you know, participated with other water 
users in the community in preparing the comments that were 
just presented in brief.  We fully support these comments 
and the continuing efforts of the Joint Water Users in these 
proceedings.
Thank you.
MR. CAFFREY:  Thank you, Steve.
Are there questions of Mr. Macaulay?
Anything from staff?
Thank you, good to see you.
Let's see.  Whatever happened to Mr. Denton?
MR. DENTON:  I'm here.
MR. CAFFREY:  You are after Mr. Helwick.  
All right, Mr. Helwick, go ahead.
MR. HELWICK:  Good afternoon, Mr. Chairman and 
members of the Board.
I am Robert Helwick, General Counsel for the East Bay 
Municipal Utility District, and as you heard earlier, the 
District has joined in the comments as submitted by the 
Joint Water Users, and we have also submitted some written 
comments of our own supplementing issues that are up for 
discussion in today's workshop.
I won't be repeating our written statement, but would 
just like to touch on some of the key points we have focused 
on in our comments.
With respect to issue 9 relating to the environmental 
impacts, I think it is indeed true that modification of 
water rights on tributaries to the Delta will indeed provide 
a measure of benefit for meeting Delta water quality 
objectives.  However, some of those tributaries, because of 
their size and in proportion to the Delta, may have a 
limited ability to affect habitat.
Modifications to water rights to meet the concerns in 
the Delta may not coincide with the timing and volume of 
flows that are needed to maintain suitable habitat 
conditions upstream from the Delta.  Thus, the State Board 
must consider not only the level of benefit which can be 
achieved by allocation methods to meet Delta water quality 
objectives, but also, the corresponding detriment that those 
actions could potentially cause to fishery resources 
upstream.
The District has previously brought to this Board's 
attention East Bay MUD's lower Mokelumne River management 
plan as one example of efforts that are currently under way 
to improve salmon and steelhead population abundance on 
upstream tributaries.
If additional water is needed to meet Delta 
objectives, it should be provided in a way that does not 
upset such efforts or undermine the balanced approach that 
was taken to resource allocation by this Board in other 
proceedings.
Other environmental impacts that have to be taken 
into consideration include the effects on upstream carryover 
storage.  Carryover storage on those upstream rivers is 
extremely important for purposes of maintaining a number of 
factors.
On the one hand, upstream reservoirs themselves are 
the habitat for fisheries within the reservoirs.  Upstream 
reservoirs also make available an extensive recreation 
opportunity that comes into the balance.
But, in addition, carryover storage is critical for 
enabling projects to meet downstream flow requirements 
during the dry months, and also, to provide flows to 
maintain the fisheries during protracted drought conditions.
In addition, as several parties have expressed today, 
it is also extremely important that the State Board take a 
broad look and consider the impacts of allocation on water 
supply availability for beneficial uses in addition to the 
instream uses.  In particular, the Board should take into 
account the impacts of water supply shortages that might 
result in a reallocation on urban communities such as the 
metropolitan area of San Francisco Bay.
With respect to issue No. 10 and the question of 
method of allocation, I would like to underscore the 
importance of the State Board's consideration in any method 
of allocation of the reasonableness of each party's 
individual use of water.  Water that is being wasted, that 
is not being put to reasonable beneficial use consistent 
with Article X, Section 2, should be subject to restrictions 
and should be made available for meeting Delta standards.
The State Board should consider, in particular, the 
extent to which urban users are adhering to best management 
practices and agricultural users are implementing efficient 
water management practices.
The Term 91 approach which has been described in 
issue No. 10 of the workshop notice, if it is to be 
considered, should allow for augmentation of Delta inflow by 
imposing restrictions on waste and unreasonable use.  
Moreover, a Term 91 approach should not be applied 
universally to all diverters without regard to location, 
seniority and priority of the affected use.
The principles of California law which govern 
seniority of rights and water right priority must be 
recognized as a fundamental component of the allocation 
process.
And finally, with regard to issue No. 13, I would 
like to urge this Board that pollution that affects Delta 
water quality should not be responded to simply by imposing 
increased flow requirements on others for the purpose of 
diluting the pollution.  In order to preserve to the extent 
possible water availability for multiple beneficial uses, it 
is extremely important that pollution be controlled at the 
source and not dealt with through dilution.
I appreciate the opportunity to make these comments 
to the Board and would be happy to answer any questions.
MR. CAFFREY:  Thank you very much, Mr. Helwick.
Any questions by Board members?
Mr. Pettit or staff?
Thank you very much, sir.  We appreciate your being 
here.
I'm down to Mr. Berliner and Mr. Denton. Who is next?
Good afternoon and welcome.
MR. BERLINER:  Good afternoon.  I am Tom Berliner, 
representing the City and County of San Francisco.
I apologize for being tardy earlier.  I was taken 
away to handle some other business and I apologize.
MR. CAFFREY:  We know you are a busy man.
MR. BERLINER:  Sometimes you are pulled in two 
directions and you always answer your boss.
MR. CAFFREY:  We understand that.
MR. BERLINER:  As the Board is aware, San Francisco 
has joined with other water users in the state to try to 
come up with an approach that will meet the needs of the 
Bay-Delta system for water quality protection.  We are 
involved in negotiations with other water users and we hope 
to arrive at a reasonable and well-balanced solution to this 
very difficult problem.
We have joined with the Joint Water Users to a 
certain extent and support their comments to that degree.  
I have to say that in pulling together a coalition or 
trying to reach consensus with a group whose interests are 
not completely aligned is a difficult task and we have tried 
very hard to reach areas of compromise where we could, where 
we felt they were in the best interest of the state and met 
the needs of water users.
However, we are not in complete accord on all issues, 
but we are pretty close on those where it's been indicated.  
I think that there still are some differences on the water 
rights approach and some on particular areas that will be 
addressed throughout the course of the proceedings here, 
some of which are merely detail and others of which are 
fairly important.
However, I think we are in agreement that the Board 
has to take a broad view and should not be constrained or 
arbitrary in the way that it approaches this problem.
As you may recall, San Francisco had some strong 
objections to the staff proposal on D-1630.  We think that 
type of broad-brush approach where everybody would just put 
water down into the system based upon reservoir capacity or 
suggestions of that like are not appropriate, and we want to 
emphasize to the Board that we do think there has to be a 
very rational basis to the Board's approach, and 
specifically, endorse as one of the key considerations the 
factors that were set forth in the Joint Water Users' 
statement on issue No. 10 regarding the Board's 
consideration of waste and unreasonable use, et cetera.
Regarding some of the other issues, key issue No. 7, 
regarding increasing the natural production of chinook 
salmon, we do join with the Joint Water Users' statement.  
In addition, we think that the installation of the barrier 
at the head of Old River is an essential component of any 
successful program to increase salmon production.
Further, we think that it is important that the Board 
review again the standards for the San Joaquin River over 
the next three years.
Regarding issue No. 8, we think that each party 
should be responsible for mitigating their own impacts and, 
therefore, the Board should consider at some level the 
inclusion of all water users in the water rights decision. 
However, we think that it may be impractical to include each 
and every water user at this stage.
We are not certain, however, how many users may be 
included in the cutoff proposed by the Board of three cfs or 
200 acre-feet.  We, therefore, would suggest some 
investigation and a public forum, perhaps a workshop, that 
would inform the water-rights holder as to what percentage 
of those using water or contributing to the Bay-Delta 
problems, would be included in this cutoff.
Also, we want to emphasize that since we are not only 
dealing with outflow but other facts as well, that the Board 
not constrain itself simply to diversions or storage size, 
but look at the other factors.
I have to say if you are sensing that there may be a 
difference of opinion as to whether questions of pollution 
should be included here, or unscreened diversions, I think 
that's one area where we may have a difference of opinion 
with the Joint Water Users.
It is hard to know exactly what the best way is to 
approach this problem.  In our view, when we started on this 
process we thought the Board would have a very comprehensive 
approach, would be dealing with all of the facts that were 
identified. 
We are willing to be open to the process, and 
consider a separate proceeding where the Board would deal 
with the other factors that are affecting the Bay-Delta 
ecosystem and were equally giving consideration to whether 
it should be included as part of this process.
So, it may be a workshop or some other investigation 
would be wise concerning what the scope of this proceeding 
should be and whether it is useful to have a separate 
proceeding or proceedings on those other issues.
MR. DEL PIERO:  Do you have a suggestion or 
preference?
MR. BERLINER:  Not at this point, really.  I think 
that there are difficulties with either approach.  If we 
focus simply on the use of water, we aren't focusing on the 
other problems that we have all agreed are a problem, and we 
are putting off to another day dealing with issues that are 
part of the Category 3 investigation and that have been the 
subject of a lot of testimony before this Board.  If we 
include it here, it is going to be a very very broad 
proceeding and it is going to be very lengthy.
Now, maybe that's the best way to approach it, put 
everybody into the pot at the same time to deal with this as 
a comprehensive program.  
I know that there are concerns among some of the 
water users that we get going and we establish the flow 
standards for the Delta and get that behind us.
On the other hand, I think that there are these other 
factors like pollution and the unscreened pumps that are so 
important that they ought to be considered, if not in this 
proceeding perhaps in a parallel proceeding that proceeds 
relatively soon, or at the latest, right after the 
conclusion of this proceeding, and it may be something to 
consider about starting a parallel proceeding that takes up 
those issues but avoids duplication. 
And that's one of the concerns, you wouldn't want to 
duplicate the efforts here.  After all, we are going to be 
seeing the same parties in any proceeding.  I think it's 
worth further discussion but we don't have a specific 
suggestion.
MR. CAFFREY:  All right, Mr. Berliner, why don't you 
proceed.
MR. BERLINER:  continuing, key issue 9, I think part 
of our comments are mooted at this point if the Board is 
going to be extending the deadline for comments and 
expanding the scope of the area that's going to be 
considered under the environmental review.
I would just emphasize that the description of the 
project setting does include the area of the state where the 
bulk of the population resides, and that it is extremely 
important to analyze the economic and environmental impacts 
that will occur in areas that divert water from the Delta 
but that are not necessarily located in the Delta itself.
In addition, I might add that some of the issues that 
should be considered are going to be the effect on those 
that use water from the Delta regarding quantity and quality 
if those supplies are reduced or altered, or if access to 
future supplies is impaired as a result of the State Board's 
decision.
The Board must consider not only new, but long-term 
effects as well.  The Board should also consider public 
health impacts if as a result of its actions water quality 
may be degraded by use of alternative sources or by being 
deprived of high quality water currently being used to blend 
with lower quality water.
In addition, the Board should consider the direct and 
indirect economic impacts which may result from reallocation 
of water supply, use of alternative supplies, requirements 
for additional water treatment, loss of reuse capability or 
increased reliance on groundwater and other such factors.
Concerning key issue No. 10 --
MR. CAFFREY:  May I ask how much more time you think 
you are going to need?
MR. BERLINER:  A minute.
MR. CAFFREY:  Please continue.
MR. BERLINER:  Regarding key issue No. 10, if the 
Board is interested in some additional comments on 
mitigation credit, I would be happy to engage in a brief 
discussion of that.  I would just point out that the 
mitigation credit concept is meant to apply not only to 
urban users but to agricultural users, not only to water 
issues but to pollutant issues as well, and that it ought 
not to be constrained merely to trading like for like, but 
if possible, the consideration of Category 3 type items 
where that may reduce the amount of outflow, for instance, 
that might be required.
MR. DEL PIERO:  Who would administer the program?
MR. BERLINER:  At this point, the State Board, we 
think is the appropriate place, but on the other hand, it 
may be possible to establish a different authority that 
could handle the mitigation credits.
Our concern, though, is that the Board plays a role 
here to be sure the standards are met, so while the 
mechanism for mitigation credits might not be handled here 
such as the air pollutant trading program in Southern 
California, you could have; in other words, a market that is 
created, that could be handled by a separate entity, but the 
Board is responsible for standards and has to make sure 
those are complied with so that ultimately negotiations 
would have to meet the Board's approval.
MR. DEL PIERO:  Would we have to get registered with 
the SEC?
MR. BERLINER:  I don't think we want to put the Board 
in that kind of market, at least I wouldn't advise it given 
that some other governmental entities have had problems as 
far as financial arrangements lately.
We support the comments of CUWA regarding issue No. 
10 and San Francisco's prior comments which have been 
submitted to the Board.
Regarding key issue 11, San Francisco believes that 
this should be the subject of a workshop.  The combined use 
of the State and Federal pumps has tremendous implications.  
There's a great deal of concern among water users as to what 
might result.  I think some of the Board's questions are 
indicative of some of the issues that could be discussed and 
it is such a large issue that we think the Board should 
consider it separately in a focused workshop just on that 
issue alone.
Concerning the no-action alternative, our written 
testimony indicates we don't have any response at this time.  
However, in giving some additional consideration to some of 
the comments that have been submitted, we think that the 
Board should be considering D-1485, the status of the 
endangered species flows, and to the extent that the CVPIA 
has been implemented, that the Board should take that into 
consideration, and in the event that there are future 
changes under the CVPIA in terms of the implementation or 
operation, that the Board should consider those as well as 
part of the base case.
Concerning key issue 13, we refer you back to our 
response to key issue No. 7.
As to key issue No. 14, we join with the comments of 
the Joint California Water Users.
As to key issue No. 15, we think the Board should 
reserve consideration of workshops at this time.  It may be 
appropriate for workshops in the future.  We have 
recommended at least one.  It may be appropriate in the 
future to consider additional workshops as the needs arise 
and I think Cliff Schulz indicated it may be worthwhile to 
hold an economic workshop.
We will be supportive of any workshops the Board 
wishes to hold.
MR. CAFFREY:  Thank you very much, Mr. Berliner.
Questions from Board members?
MR. STUBCHAER:  Just a comment with regard to the 
last key issue, key issue work groups, which I think are 
different from workshops.  CUWA folks said they didn't think 
any work groups were needed but they support additional 
workshops.
MR. BERLINER:  I have to say that in my haste I 
misread that and I do recall that we did distinguish between 
work groups and workshops last time around, and I would 
really encourage workshops and be very hesitant at this 
point on work groups because I think there is quite a bit of 
work going on at this point and I don't see a particular 
need for work groups at this time.
MR. DEL PIERO:  Do you have any thoughts for us in 
terms of the concept of equitable apportionment?
MR. BERLINER:  I have lots of thoughts on that.  You 
probably don't want to take all afternoon to do it, but I am 
very encouraged the Board started having very pointed 
discussions with several of the water users on this subject. 
I think there are a lot of considerations that this 
Board has to take into account in figuring out where the 
water is going to come from.
MR. DEL PIERO:  I am asking because San Francisco has 
some rights in the state.
MR. BERLINER:  Well, we don't have the oldest right.  
I think we have among the older rights among urban areas.  
There are certainly some agricultural areas that have older 
rights than San Francisco. 
But let me say I think it would be very important for 
the Board to not deviate from the established water right 
system that we have in place at this time, which is not to 
say that the Board shouldn't make additional considerations, 
and there are a lot of reasons why the Board should not 
abandon the seniority system, and I won't get into those 
now, but there's hours of discussion that can take place 
regarding reliance on those rights, and the communities that 
have developed based on those rights.
But I think there are a lot of other considerations 
that have to go on and we have to recognize that this State 
has changed in its character over the last hundred years 
from the time those water rights were developed, and that 
there are a lot of other considerations that go into place.
I think we need to look at the efficiency of use of 
water that is being made, I think we have to give 
consideration to the economic impacts of any dramatic change 
in the use of water, relocating from one area to another.  
We have to give consideration to the impacts of that water 
use on the system.  
I know there are lots of arguments about water use in 
the Central Valley and it all goes back to the system.  We 
have to remember what we are talking about here is the 
timing of the water hitting the system right now.  We are 
engineering the system to meet the needs of the environment, 
and in our view, if you are taking water out of the system 
and returning it at another time, even though the net use is 
a fraction of that diversion, there has to be consideration 
as to what the impact is on the environment, and that it is 
not enough to say, well, that water all gets back into the 
system.
We have to try to make this system as efficient as 
possible so we are not taking water away from people who are 
rightfully using it.
I could go on --  I think there are so many issues 
here that need to be addressed.  
I think that the San Francisco and CUWA testimony 
that was submitted last August touched on some of these 
issues, and I think a few other folks have as well.
I think we want to have a full airing of this, we 
ought to have a full workshop on it and discuss it fully and 
start trying to weigh these different issues that need to be 
discussed, because it is going to have tremendous impact on 
us long term and we ought to give this very careful 
consideration.
MR. CAFFREY:  We will certainly take your 
recommendation under advisement, Mr. Berliner.
Are there other questions?
Ms. Forster.
MS. FORSTER:  Clarify what you call a workshop.  You 
asked for a workshop on item 12; right?
MR. BERLINER:  This type of proceeding in front of 
the Board, a noticed workshop with a general discussion of 
the kind of considerations that the Board would like to have 
discussed, and devote a day or whatever time you think is 
appropriate to the various issues on kind of a one-shot 
workshop on each of the different issues.
MR. CAFFREY:  Anything from staff?
Mr. Howard.
MR. HOWARD:  I had a comment I would like to make.
In your written comments you said that the map of the 
project area excludes the entire coastal region of the state 
where the population is located.  This oversight should be 
corrected so that important impacts in the areas served by 
the Bay-Delta watershed are not overlooked.
Actually, it wasn't an oversight.  In putting 
together the map we were looking at the areas that would be 
sources of water to the Delta.  It was our hope that the 
export areas we could consider covered in our environmental 
report in which we did look at impacts to export areas, that 
that hopefully would narrow the scope of the proceeding a 
bit.
We have had other comments from other folks that the 
Suisun Marsh and the Trinity should be included, and I agree 
with that, but I am still not quite clear on including the 
entire export areas, again, since we are looking to change 
the standards in this proceeding.
However, to the extent that you or other participants 
have specific comments or suggestions about how the analysis 
in the export areas could be improved or expanded on, we 
will be looking to consider those.  
At present, it was not our intention to include all 
those export areas.  That is not saying we wouldn't look at 
the City of San Francisco if they got involved in a 
reallocation simply because they weren't considered in the 
Environmental Impact Report as an SWP/CVP export area.
MR. BERLINER:  I guess I'm not clear on the use of a 
map because if the map indicates the area where the Board is 
going to be looking, and the Bay Area, for instance, was not 
included in that map, then it seems to me that if you are 
going to consider us, then we ought to be on the map.  If 
you are not going to consider us, then we ought not to be 
part of the review.
I don't know how you can say, well, if we allocate 
responsibility to a party that is not on the map, we will 
consider you then.  How do we submit comments if we are not 
part of the original notice?  
And if you want to leave us off and tell us to go 
home, I suppose there are a lot of people that would be 
happy, but it just strikes me that if an area is going to be 
considered or going to be affected by the water rights 
proceeding, it needs to have opportunity to submit comments 
to the environmental review.
MR. HOWARD:  Well, they are included to the extent 
that San Francisco and all those in the State Water Project 
and Central Valley Project receive their water supplies from 
the project area; that is, Hetch-Hetchy is in the project 
map that you notice in the Notice of Preparation, but in 
terms of the analysis in the Environmental Impact Report, we 
intended that Environmental Report Appendix 1 to the Water 
Quality Control Plan to be a programmatic or a replacement 
for a programmatic EIR and we weren't going to relook at the 
same issues we had looked at before.
One of the issues we looked at was if we reduced 
exports and if we reduced water supply to the State Water 
Project and the Central Valley Project, what would be the 
effect on the export areas, so we have already looked at the 
export area effects of the standards.  We are not proposing 
to change the standards, so we are not sure what the 
additional effects in the export area are that we want to 
consider in a subsequent EIR.  That is why we didn't put it 
into the Notice of Preparation.
Is that clear?
MR. BERLINER:  Well, I know there are going to be 
effects at Hetch-Hetchy if you take water out of the 
reservoir and those are localized impacts that will be 
resulting from change in reservoir storage and downstream of 
Hetch-Hetchy.
On the other hand, the impacts in the Bay Area are 
not the same as the local water impacts up at Hetch-Hetchy.  
Those are going to be substantially different.
Now, the Water Quality Plan said that's not a water 
rights document and that there was going to be a water 
rights phase where there is going to be an allocation of 
responsibility.
If that responsibility is going to fall in part into 
the Bay Area, then communities in the Bay Area are going to 
want to submit evidence as to what they are doing with the 
water and what the impacts will be of loss of that water.
And I don't think you have provided an opportunity 
for people to submit those comments.
MR. DEL PIERO:  I would like to go back and take a 
look at the Water Quality Plan again.  I think the 
opportunity to comment in terms of that potential impact on 
the Bay Area may, in fact, be true.  
I have a question of staff.  When the Water Quality 
Plan was done, the analysis that was done showed potential 
impact on the areas that receive State Project water if the 
State Project and the Central Valley Project were to suffer 
the burden of the entire requirements for water quality.
Is that not correct?
MR. HOWARD:  That's correct.
MR. DEL PIERO:  Alternatively, I don't recall this.  
Was the analysis done, was  the growth-inducing impact 
evaluated if they didn't bear that entire burden?
MR. HOWARD:  No, there was a small section on the 
growth-inducing impact.
MR. DEL PIERO:  So, if the burden of complying with 
water quality standards in the Delta is distributed among a 
variety of water-right holders -- the other side of the 
equation was not evaluated, at least not the down side.  The 
side that would have the constrained water supply was 
evaluated, but the side that would have enhanced water 
supply was not; is that correct?
MR. HOWARD:  That's correct.
MR. DEL PIERO:   Okay.  We can talk about this after 
the break, Mr. Chairman.  
The one thing I did want to mention is that Mr. 
Berliner's suggestion of a workshop in regard to the water 
rights issue, the legal aspect of this discussion, I think 
is a highly appropriate recommendation.
MR. CAFFREY:  We will take a break and come back and 
call Richard Denton, Kevin O'Brien, Richard Moss and Cynthia 
Koehler.
(Recess)
MR. CAFFREY:  Okay, Mr. Denton, please come forward.
Welcome and good afternoon.
MR. DENTON:  Thank you.  Mr. Chairman and members of 
the Board, my name is Richard Denton.  I represent Contra 
Costa Water District.
Contra Costa Water District appreciates this 
opportunity to deliver these comments on key issues 7 
through 15. 
The District has been an active participant in water 
quality and water rights matters related to Bay-Delta issues 
for several decades and intends to continue that role 
throughout these proceedings.
CCWD submitted written comments and made an oral 
statement regarding key issues 1 through 6 at the August 29, 
1995, public workshop.  CCWD has also been an active 
participant in the development of the Joint California Water 
Users statement for this workshop and generally supports 
that statement.  
Most specifically, we support the statements of the 
Joint Water Users with regard to issues 7, 8, 9, 12, 14 and 
15, so my oral comments today will be with respect to issues 
10, 11 and 13.
CCWD supports the statement made by the Joint Water 
Users regarding issue 10, and believes that their 
recommendation for a phased implementation approach suggests 
a legally and administratively appropriate method for the 
allocation of responsibility.
CCWD agrees that any allocation process conducted by 
the State Board should be based upon the reasonableness 
criteria of the California Constitution, the public trust 
doctrine and other elements of California law, including the 
various statutory priorities.  However, our comments today 
are in regard to one of these statutory priorities, the 
Delta Protection Act.
The District believes that there is an important 
distinction between the Delta Protection Act and county of 
origin and watershed of origin statutes.  The Delta 
Protection Act is slightly different in that it establishes 
an additional statutory priority which the State Board must 
take into account in the allocation process.
In enacting the Delta Protection Act in 1959, the 
Legislature appears to have added two new substantive 
measures which provide protection for in-Delta water users.  
	The first such measure was salinity control, which 
was extensively litigated in regard to Decision 1485 and 
discussed at length in the Racanelli decision.
The second substantive protection added to the Water 
Code by the Delta Protection Act concerns maintenance and 
provision of an adequate water supply for in-Delta users.  
CCWD believes that this second mandate in Section 
12202 is separate from the salinity control directive.  We 
submit that while in-Delta users are subject to the same 
constitutional, public trust, and public welfare doctrines 
as are other water users, the Delta Protection Act gives 
them an additional statutory priority which is not available 
to water users located outside the Delta and which must be 
taken into account by the State Board in its allocation 
process.
The Diablo Water District is one of CCWD's rural 
water customers and has submitted a separate written 
statement supporting CCWD's comments on issue No. 10.
With regard to issue No. 11, the District generally 
supports the position of the Joint Water Users in regard to 
combined use of SWP and CVP diversion points, because the 
additional flexibility will help minimize fish losses while 
meeting water quality standards and water supply objectives.
The State Board's water right Order 95-6 permitted 
temporary joint use of these points of diversion as long as 
certain important conditions were met.  
The District believes that the State Board approval 
of permanent use of the combined points of diversion, 
particularly if it includes approval of increases in 
diversions beyond existing permit conditions, should be 
subject to similar conditions.
The District believes that the State Board must 
require that increased export operations not cause injury to 
any legal user of water as was included in water rights 
Order 95-6, which was in response to CCWD's testimony, and 
is required by Water Code provisions dealing with petitions 
for changes.
CCWD believes that if increased export operations are 
permitted, the increment of additional export water could, 
depending on the details of the State Board's action, 
require a new appropriative permit.
Finally, the District believes that adequate 
environmental documentation is particularly important with 
regard to combined use of the Central Valley Project and the 
State Water Project diversion points.
With regard to issue No. 13, the State Board should 
only take actions that facilitate and do not inhibit ongoing 
processes to improve habitat conditions in the Bay-Delta 
watershed. 
We heard today such include development and 
implementation of Category 3 measures, the CVPIA restoration 
fund, and the Cal-Fed process.
In taking such actions, the State Board should 
recognize and acknowledge that parties which are paying 
CVPIA restoration fund payments should not be made to pay 
twice for such measures.
The District supports East Bay MUD's written 
statement that the State Board should also recognize the 
pollution caused by discharges into the Delta contributing 
to degradation of habitat conditions in the Bay-Delta 
watershed.
The State Board and the appropriate Regional Water 
Quality Control Board should seek to curtail pollution at 
the source and enforce water quality standards as an 
additional means of addressing habitat restoration.  
Exporting drainage to other areas must be avoided, 
particularly when the receiving area is the already 
environmentally sensitive Delta.
CCWD appreciates the opportunity to present these 
comments and we would be happy to respond to any questions.
MR. CAFFREY:  Thank you, Mr. Denton.
Mr. Stubchaer.
MR. STUBCHAER:  How much of your service area is 
within the legal Delta?
MR. DENTON:  Not all of it.  There's, I would say, 
about at least a third of the service area within the legal 
Delta.
MR. STUBCHAER:  Thank you.
MR. CAFFREY:  Any other questions of Mr. Denton by 
Board members?
Anything from staff?
Thank you very much.
Next is Kevin O'Brien.
Good afternoon, sir, and welcome.
MR. O'BRIEN:  Good afternoon, Mr. Chairman and 
members of the Board.
I am Kevin O'Brien with the firm of Downey, Brand, 
Seymour & Rohwer.  
I am appearing here today representing ten districts, 
East Contra Costa Irrigation District, Maxwell Irrigation 
District, Natomas Central Mutual Water Company, North Delta 
Water Agency, Reclamation Districts 108, 999, 1004, 2068, 
South Sutter Water District and the Sutter Mutual Water 
Company.
Those entities joined in the joint statement of the 
Upstream Users which Mr. Chatigny presented.
I will be submitting some supplemental written 
statement tomorrow.  I just wanted to briefly touch on a 
couple of issues that are of particular importance to my 
clients in this proceeding.  I am going to focus on two 
principle issues.
The first involves the obligations that are imposed 
on this Board under CEQA in this proceeding.
We have heard a lot from a lot of speakers about the 
restraints, limitations and authority that flows from the 
water right system and that's a very important subject.  
But I guess I see this workshop as principally a CEQA 
scoping type workshop and I want to make sure that CEQA law 
and CEQA constraints don't get lost in the perhaps more 
interesting discussion about equitable apportioning and some 
of these other things.
Second, I would like to discuss some of the existing 
contractual mechanisms that are out there already that 
affect the Board's authority to reallocate water from one 
use to another, and in particular, I would like to talk 
about three sets of contracts.
One is the contract between North Delta Water Agency 
and the State of California.  
The second is the contract between East Contra Costa 
Irrigation District and the State of California.
And the third are the Sacramento River water rights 
settlement contracts, of which I have several clients 
involved in those contracts. 
With respect to the CEQA issue, I think one thing 
that the Board needs to keep firmly in mind as it goes 
through this process is that CEQA is more than a disclosure 
document, or more than a disclosure statute.  It is often 
said in law school courses that NEPA is a procedural 
statute, but CEQA has a substantive element to it and that's 
very much true, and that substantive element comes from the 
fact that under CEQA where a particular project alternative 
may have a significant impact on the environment, there is 
an affirmative obligation on the part of the decision maker, 
the lead agency, to mitigate significant impacts to a level 
of less than significant, if feasible.
And one of the what I think and my clients think, is 
a very feasible mitigation measure as well as a very 
feasible alternative, relates to the use of market-based 
mechanisms to accomplish any reallocation of water that may 
need to occur.
And I think that the feasibility of that type of 
mechanism and the importance of the Board looking at that as 
part of the CEQA process flows from our experience during 
the recent drought.
In that drought, as you know, there were 
reallocations of water that occurred through the Drought 
Water Bank.  Although the upstream users don't agree with 
everything that the Drought Water Bank did and don't agree 
with all of its mechanisms, one thing is pretty clear.  
About 80,000 acre-feet of water were reallocated in 1991 and 
an additional 400,000 acre-feet or so of water was 
reallocated during 1992.
That experience, I think, shows the feasibility of a 
market-based solution to this problem, and that type of 
alternative and that type of mitigation measure, we think, 
needs to be examined in this CEQA document, and it can, in 
fact, work.
Our view of it is that a market-type of allocation 
system would actually result in the most environmentally 
sensitive, least environmentally damaging result because 
what you would have is reallocations from districts who are 
in the enviable position of having adequate water to 
transfer, that have adequate groundwater supplies, that have 
adequate storage that are available to transfer water.
Using the other approach, which is more of the draft 
Decision 1630 across-the-board percentage approach, what you 
end up with is taking water from some districts that have no 
ability to make up that water, or the only way they can make 
it up is to overdraft already overdrafted groundwater basins 
or fallow land with its attendant environmental and economic 
impacts.
I guess what I am really suggesting is that as the 
staff goes forward with developing this document, it ought 
not to forget the market mechanism, and I respectfully 
submit to this Board that that mechanism is one that you 
ought to place central in your thinking about this entire 
problem.
MR. STUBCHAER:  Are you talking about a managed 
market?  I think the 1991 Water Bank was kind of a managed 
market.  Or are you talking about a free market?
MR. O'BRIEN:  I don't know that you could ever have a 
totally free market in water, Mr. Stubchaer, just because 
there are, as you know, constraints of ability to transfer 
water, the no-injury rule basically.
I would like to see the pricing mechanism for the 
market be much different than it was in the Water Bank.  I 
will tell you that right up front.
But I think that you could have the Department of 
Water Resources, or an agency like that, basically play the 
same operational role, clearing-house role, with perhaps a 
little greater degree of oversight from this Board in terms 
of some of the policy decisions that are made on how much 
water is available for transfer.
MR. CAFFREY:  Mr. Brown.
MR. BROWN:  In your concern for the overdrafted 
groundwater basin, of the 800,000 and the 400,000, do you 
have an idea of how much of that may have been made up by 
groundwater?
MR. O'BRIEN:  I don't have that off the top of my 
head, Mr. Brown.  I know in 1991, a good portion of that was 
contributed through fallowing because the price was fairly 
high, $125 an acre-foot.  
I know in 1992 when the price dropped to $50 an acre-
foot, I don't believe any of that was made up through 
fallowing.  I think the 400,000 was principally groundwater 
replacement, but I defer to whatever the Drought Water Bank 
EIR says on that subject.
Moving to the second issue, which is the question of 
how you factor in existing contractual mechanisms, there's 
three contracts I want to bring to the Board's attention, 
and I know that I have been up here and George Basye from my 
firm has been up here before respectfully reminding the 
Board members these contracts are out there, but I am 
probably going to say it a little more often and a little 
more loudly now that we start to get into this water rights 
proceeding because these contracts are mechanisms that were 
agreed upon for precisely the purpose that we are dealing 
with now, which is the question of who is going to bear what 
responsibilities.
And the one I would like to talk about first is the 
North Delta Water Agency agreement.  The North Delta Water 
Agency comprises about 300,000 acres of farm land in the 
North Delta region, and in 1981, that Agency executed an 
agreement with the State through the Department of Water 
Resources under which the Agency pays the State 
approximately $170,000 per year, and actually, that number 
is higher now, so that since 1981, the Agency has paid the 
State somewhere around two million dollars or so for the 
contractual protection under its contract.
And in terms of what the Agency is supposed to get 
back in return for those payments, the contract is quite 
clear, and there's really two items:  One is a guaranteed 
water quality at certain points in the Delta which are 
specified in the contract; but the other item is mentioned 
in paragraph 8(a)(ii) of the contract, and I just wanted to 
read the language to you so you have an idea of how the 
precise wording reads.  It says:
The State recognizes the right of the water users of 
the Agency to divert from the Delta channels for reasonable 
and beneficial uses for agricultural, municipal and 
industrial purposes on lands within the Agency, and said 
diversions and uses shall not be disturbed or challenged by 
the State so long as this contract is in full force and 
effect.
Now, there's a lot of folks within the North Delta 
Water Agency that feel they have spent about two million 
dollars so that the State would stand behind the obligation 
I have just read, and we think that as this Board goes 
forward in this water right proceeding, that obligation that 
the State of California undertook and which remains in full 
force and effect ought to mean a lot in this context.
And I am going to be submitting a copy of the 
agreement again for your review, but I just wanted to bring 
it to your attention.
There is a similar agreement with the East Contra 
Costa Irrigation District executed about the same time frame 
with a similar effect, and we would suggest it has the same 
relevancy to this whole proceeding, so I will be submitting 
those to the Board.
MR. DEL PIERO:  Mr. O'Brien, perhaps that might be 
part of the no-project alternative.
MR. O'BRIEN:  I would heartily support that, Mr. Del 
Piero.
MR. DEL PIERO:  I am not suggesting that, I am asking 
the question.
MR. O'BRIEN:  I guess beyond that CEQA issue, what I 
would argue is that the Board really doesn't have any 
authority to deviate from what is in this contract.
The final category of contracts I wanted to mention 
are the so-called Sacramento water rights settlement 
contracts which were entered into in 1964 between the Bureau 
of Reclamation and various water-rights holders to the 
Sacramento River.  Those contracts in the aggregate cover 
about two million acre-feet of diversion rights, and that 
includes both base supply, which is water which confirms 
pre-existing water rights, and project water, which is water 
out of the Central Valley Project.
The point I want to make about the Sacramento River 
water settlement contracts is that those contracts were 
entered into in large part to avoid adjudication of the 
Sacramento River.
After Shasta Dam was completed, the Federal 
Government came in and realized if it was going to have a 
way to operate that reservoir and that system, it had to 
come to peace with the prior right holders downstream of the 
reservoir, and these contracts are the mechanism through 
which that occurred.
Now, it is our position that this Board doesn't have 
the legal authority to alter the terms of a contract between 
the Federal Government and individual water-right holders, 
and we will be pursuing that position as we go through these 
hearings, but I wanted just to point out to the Board that 
there are these existing contracts out there and you don't 
necessarily come to this water rights issue with a 
completely clean slate.
The last thing I just wanted to take a minute to talk 
about is this equitable apportionment issue that's been the 
subject of a lot of discussion today.  I remember last year 
coming to the workshops and the catch phrase I kept hearing 
was, share the pain, and I shared the pain so much I was 
pretty tired of hearing about it.
The share the pain is out in '95 and equitable 
apportionment is in.  It has a real nice ring to it, but I 
think it is the same concept basically.  What I understand 
equitable apportionment to mean is the Board would not be 
constrained by water right priorities, at least in the 
strict sense, would not be constrained by some of the other 
laws like area of origin, watershed protection and Delta 
Protection Act protection.
I thought it was quite instructive when Mr. Del Piero 
asked Mr. Schulz and Mr. Haroff the question of how this 
would actually be applied in certain situations.  I don't 
think if you asked various proponents of this equitable 
apportionment that question you would get the same answer 
twice, and that is the problem with this idea.
MR. DEL PIERO:  That's my problem.
MR. O'BRIEN:  It sure is.
MR. DEL PIERO:  I keep trying to figure it out.  The 
answer is difficult.
MR. O'BRIEN:  And I think what you are being asked to 
do, frankly, is to create an analog in natural resources law 
of the equitable apportionment which would be analogous to 
the law of obscenity in the First Amendment, which is 
basically we don't know what obscenity is but we know it 
when we see it, and I think that's the kind of rudderless 
morass that you may find yourself in.
Mr. Lilly, I think, suggested this in his comments, 
that getting into this equitable apportionment notion is a 
very slippery slope for this Board, and I think it is really 
something that needs to be given some thought.  
I would support the idea, Mr. Del Piero, about having 
this Board workshop dealing with this question of water 
rights issues and I think when you notice that workshop, it 
is going to be very important to really try to pin people 
down in terms of what precisely they mean by these terms, 
because unless someone explains how equitable apportionment 
is going to work in practice, it's not going to be very 
helpful to you.
You have to be told exactly what are the consequences 
of applying this approach, what criteria do you apply and 
what results do you get.  And until you start getting 
answers to those questions, you are going to have a lot of 
trouble.
Now, of course, I and my clients advocate that you 
apply what we think is the simple solution, the solution 
that's worked in the state for the last hundred years, which 
is you apply the water rights priority system and we think 
that that not only is the fairest and simplest approach, but 
when you couple it with the ability to move water to market 
mechanisms, we think it is also an environmentally superior 
approach.
Thank you.
MR. CAFFREY:  Thank you very much, Mr. O'Brien.
Any questions? 
Ms. Forster.
MS. FORSTER:  I have a question.  When you were 
giving the historical perspective on the different 
contracts, I was hit by something and I wanted to see what 
you thought about this.
When these contracts were done, was the public trust 
doctrine around?  Was the ESA requirement there?  Somehow 
these new laws have come about and it seems that there 
hasn't been a good enough linkage to what people's rights 
were and what their traditional and historical uses are.
And so, how do you feel from your perspective as an 
attorney, how do you deal with these new issues and what we 
are looking at, because it is true that historically things 
are pretty cut and dried, but a lot of things have come along 
in the past 25 years that don't make it so cut and dried?
	MR. O'BRIEN:  That's a good question.  What you 
are taught in law school about a contract is that a  
contract is fundamentally a mechanism to allocate risk, and 
it seems to me that when the State of California signed a 
document and agreed to take these two million dollars I 
described previously, and that document contains the kind of 
language that I read to you, which I think is quite clear 
and quite broad, the State of California undertook a risk 
and that risk was that things might change, and this 
contract was signed in 1981.
The National Audubon had not been decided at that 
point, but we had ESA.  We were well into the environmental 
movement.  I think the risk was quite clear in 1981, so my 
answer to that question is that in that case, the risk was 
undertaken by the State, and just because history has shown 
maybe that decision in hindsight wasn't the decision that 
the State would want to undertake now doesn't change the 
legal obligation.
MR. CAFFREY:  Very tactfully answered, Mr. O'Brien.  
He is telling us it is our problem, not his.  He is in a 
role of advocacy and it is up to this Board to deal with all 
of these complicated issues that have come to the Board 
since these contracts were signed, such as the public trust.
We appreciate your dilemma as well.  
Any other questions from staff?
Ms. Leidigh.
MS. LEIDIGH:  Mr. O'Brien, the contracts that were 
signed by North Delta Water Agency and the East Contra 
Costa, my recollection is that it was the Department of 
Water Resources that was the signer of those contracts; is 
that correct?
MR. O'BRIEN:  That's correct.
MS. LEIDIGH:  As a water supplier.
MR. O'BRIEN:  The party stated is the State of 
California through the Department of Water Resources.
MS. LEIDIGH:  So, that was signed by the Director of 
the Department of Water Resources.
MR. O'BRIEN:  I believe that's correct, Ronald Robie.
MS. LEIDIGH:  Can you explain your theory of why it 
is the State Water Board is bound by a contract that was 
executed by the Department of Water Resources?
MR. O'BRIEN:  Well, I would be happy to submit a 
legal analysis of that issue.  I think the short answer is 
that the State of California in entering into contracts 
through all its agencies does not have the ability to enter 
into contracts with one agency on the one hand and accept 
money on the other hand, and then through another agency 
simply disavow the contract.  
I don't think the Federal Government has that right 
and I don't think the State has that right.
MS. LEIDIGH:  I think there is probably a difference 
between disallowing the contract and being bound by a 
contract.
Wouldn't it be correct to say that line of 
responsibility runs through the Department?
MR. O'BRIEN:  Well, your point is well taken, Ms. 
Leidigh, that perhaps in the first instance the agency would 
look to the Department to make it whole.  However, if this 
Board has searched the legal authority to essentially cut 
through the contract and change the obligations under that 
contract, in a sense that suddenly the agency would have a 
responsibility to diminish its diversions notwithstanding 
the very broad and clear language of the contract, then my 
personal opinion is that that would constitute an impairment 
of the contract by the State of California.
MS. LEIDIGH:  Well, I would like to see whatever 
legal analysis you would have with respect to how the State 
Board is bound.  I would like a clearer explanation.
MR. O'BRIEN:  I would be glad to.
MR. CAFFREY:  Nothing else? 
Thank you, Mr. O'Brien.
I'm sorry, Mr. Pettit.
MR. PETTIT:  Mr. O'Brien, when you concluded your 
statement you made reference to the fact that we should 
stick with the water rights priority.
MR. O'BRIEN:  Correct.
MR. PETTIT:  Did you hear Mr. Buck's response to the 
question I asked him when I asked him to distinguish between 
seniority and priority as he used them?
MR. O'BRIEN:  I don't recall that specific answer, 
Mr. Pettit.
MR. PETTIT:  If I can paraphrase his response, I 
think he distinguished seniority as the time the use 
initiated or chronological right, and priority as alluding 
to the type of use that was being made of the water.
Is that what you had in mind?
MR. O'BRIEN:  No, sir.
MR. PETTIT:  Thank you.
MR. O'BRIEN:  If I could just expand on that for a 
moment.
MR. CAFFREY:  Very briefly, please do.
MR. O'BRIEN:  In the provisions of the Water Code we 
talk about domestic being the highest use and agriculture 
the second highest use.  If you look carefully at those 
provisions, they are found in the provision relating to 
competing water right applications, say you have competing 
applications in which perhaps a municipal application was 
filed second priority to an agricultural application, and 
they are competing on the same stream system.  
So you may have certain authority to put the domestic 
application ahead of the agricultural application.  
Interestingly, that provision does not talk in terms 
of municipal use.  It only talks about domestic use which is 
an interesting issue in itself.
MR. PETTIT:  That is the distinction I wanted to make 
and get out on the table because I think it would tend to 
use the words carelessly.
MR. CAFFREY:  All right, thank you very much, Mr. 
O'Brien.
Richard Moss.  Good afternoon, sir, and welcome.
MR. MOSS:  Good afternoon.
Mr. Chairman and lady and gentlemen of the Board, my 
name is Richard Moss, General Manager of the Friant Water 
Users Authority.
I do appreciate the opportunity to appear before you 
here today.  I will try to keep my comments brief and just 
basically highlight the written statement that I have 
already provided to the Board.
Additionally, however, in my testimony here today I 
will provide a response to a few of the points raised at the 
last workshop regarding the ability, or more accurately the 
inability of Friant to make releases from Friant Dam and 
contribute to the Bay-Delta resolution.
In response to key issue No. 7, I would note that  
the Authority concurs with the recommendations of the     
San Joaquin Tributaries Agencies relative to the restoration 
of salmon stocks.
We wish to emphasize one action which must not be 
taken to address salmon doubling or any other goal on the 
San Joaquin River.  More specifically, the Board must not 
direct or even permit the releases of water from Friant Dam 
into the San Joaquin River channel.
The Board recognized, in connection with its Draft 
Decision 1630, that releases from Friant Dam for purposes of 
meeting Bay-Delta standards should not be required, and the 
Board must not waiver from its earlier conclusions in that 
regard.
Requiring releases from Friant Dam to assist in 
salmon doubling or achieving Bay-Delta standards would be 
unreasonable and in contravention of the applicable 
standards imposed by the California Constitution and the 
Water Code.
Losses associated with water released from Friant Dam 
would be enormous before that water reaches Vernalis.  
Additional losses could be expected downstream from Mendota 
Pool.  Therefore, it is predictable that Friant Division 
water users would have to forego the use of an enormous 
amount of water in order to permit a relatively small amount 
of water to reach the Delta.
In Phase 1 of the Bay-Delta hearings that began in 
1987, exhibits and testimony were introduced by the Central 
Valley Project Water Association substantiating the 
efficient and beneficial use of irrigation water, the 
diversified cropping pattern, high crop value and the 
resulting rich agricultural economy dependent on a continued 
Central Valley Project water supply within the Friant 
Division.
In addition, exhibits and testimony were introduced 
by the Central Valley Agricultural Water Users establishing 
the economic and social importance of maintaining the 
existing supplemental agricultural water supply to the 
districts within the Friant Division.  All of this evidence 
is in the Board's records and is incorporated herein by this 
reference.  
While that evidence was based on 1985 production 
values, it is safe to say that in 1995 the Friant Division 
continues to lead the state, the nation and the world in 
using the water we have to generate high-value crops.
Unfortunately, the region is already chronically 
water short. Thus depriving it of massive amounts of water, 
especially to provide a relatively small amount of water for 
salmon doubling or for Delta standards simply cannot be 
justified in light of the ramifications to the region, the 
state and the country.
The potentially disastrous consequences of a loss of 
water to the Friant Division contractors has even recently 
been considered by the United States District Court for the 
Eastern District of California, which concluded that the 
hardship of such a loss to Friant Division contractors and 
those who depend upon them would be devastating.
Mandated Friant Dam releases for purposes of 
achieving improvements in salmon populations or water 
quality objectives would also contravene congressional 
intent with respect to the operation of the Friant Division.  
As confirmed by the United States Supreme Court in 
both United States v. Gerlach Livestock Company and Dugan v. 
Rank, it was the clear intent of Congress in authorizing the 
construction of Friant Dam to divert the entire flow of the 
San Joaquin River, after providing for a live stream to 
Gravelly Ford, for distribution within the Friant Division 
of the Central Valley Project.
The Supreme Court noted that the Government would be 
stopped in its tracks if any material flows were required to 
be released from Friant Dam.
Releases from Friant Dam for purposes of achieving 
environmental goals would, therefore, be contrary to 
congressional intent, as well as a violation of California 
law and prudent water management.
In response to key issue No. 9, again the Authority 
concurs with the comments of the San Joaquin Tributaries 
Association.  However, relative to the Friant Division, the 
Board should note that surface supplies provided from Friant 
Dam provide on average approximately two-thirds of the 
irrigation water used to produce over two billion dollars 
worth of agricultural product each year.
As noted in connection with key issue 7, any loss of 
water from the already water-deficient Friant Division 
service area would have material adverse impacts. 
The Board must consider the economic, sociological, 
human and environmental effects of any loss of water within 
the Friant Division, as well as the potential impacts on the 
already overdrafted groundwater supplies within the Friant 
Division service area resulting from further deficiencies in 
surface water supply.
In response to key issue No. 11, the Authority again 
joins the San Joaquin Tributaries Association in endorsing 
the installation of a barrier at the head of Old River.  
However, we do not believe that support for the Board's 
approval of a combined use of the CVP and the State Water 
Project points of diversion in the Delta should be 
conditioned on the installation of such a barrier, and 
instead, encourages the Board to approve combined use of 
those points of diversion and pursue an Old River barrier as 
soon as possible.
In response to key issue No. 12, the authority 
generally agrees with the San Joaquin Tributaries 
Association that the no-action alternative for the Board's 
analysis should be Decision 1485 conditions, including CVPIA 
requirements and Endangered Species Act requirements validly 
imposed for winter-run chinook salmon and Delta smelt.
However, we would remind the Board that appropriate 
assumptions must be made as to exactly what CVPIA and the 
Endangered Species Act requirements will be in place.  
As earlier noted by Mr. Del Piero, substantial 
efforts are now under way to revise both laws, and both 
statutory schemes are subject to significant variability in 
their administration.  Accordingly, the no-action alterna-
tive should take into consideration the most likely 
circumstances relative to both CVPIA and Endangered Species 
Act requirements in light of all present and reasonably 
foreseeable circumstances, both legislatively and 
administratively.
I would further note that there's considerable 
cumulative impacts associated with the implementation of the 
Endangered Species Act and the CVPIA, and while it may not 
be the no-action alternative, I would suggest to you that an 
additional alternative which compares against just a known 
condition in time, which was D-1485, be also considered.  
That way, you are, in fact, fulfilling all of the 
informational requirements of a CEQA document in analyzing 
what the impacts would be maybe beyond what the law 
requires, but clearly providing a back to baseline, which 
everyone understands.
If you provide that in the document, I think you will 
be providing a more complete analysis.
Again, I thank you for the opportunity to appear here 
today and am ready and willing to answer any of your 
questions.
MR. CAFFREY:  Thank you, Mr. Moss.
Any questions from Board members?
Mr. Brown.
MR. BROWN:  Mr. Moss, on key issue 9, you state that 
approximately two-thirds of the irrigation water requirement 
is met by, I guess, diversions from Friant and the other 
third is made up by groundwater?
MR. MOSS:  Not totally.  There are also some local 
streams, local reservoirs, the Kaweah and the Kings.
MR. BROWN:  What is the condition of the groundwater 
table over the years?
MR. MOSS:  It is declining.  Within the Friant 
district alone, it is declining at the rate of approximately 
100,000 acre-feet per year.  Within the Southern San Joaquin 
Valley in its entirety, it is significantly more than that.  
Estimates have been made on the order of a million acre-feet 
per year.
MR. BROWN:  Has any of the DBC worked its way up into 
that part -- I know Fresno has organic problems in the 
groundwater basin and subsidence.
MR. MOSS:  There are other areas of the service area 
that do have nitrate problems as well as, again, the DBC 
problem principally caused by the concentration of the 
chemical as it is pulled into the groundwater hole created 
by cities who are primarily exclusively pumping groundwater 
in most cases.
MR. BROWN:  Thank you.
MR. CAFFREY:  Other questions of Mr. Moss?
Anything from staff?
Thank you, sir, very much.
Cynthia Koehler.  Good afternoon.  It's been a while 
since we have seen you.
MS. KOEHLER:  It is always good to be back before the 
Board.  I always enjoy an opportunity to get over to Mono 
Lake.
My name is Cynthia Koehler and I am the Senior 
Attorney with the National Heritage Institute.  
We are preparing more detailed written comments and I 
understand that there is additional time to submit those.  
Is there a deadline by which we should have written comments 
to the Board on these issues?
MR. CAFFREY:  Actually, I think, and correct me if I 
am wrong, Ms. Leidigh, the way we have noticed it, we 
basically keep it open-ended, and as I said, the Board 
always appreciates any additional information you have and 
the one qualifier is please provide 20 copies to the Board.
MS. LEIDIGH:  And copies to the other parties.
MS. KOEHLER:  We will be providing 20 copies to the 
Board as well as copies to other interested parties as well 
within the next couple of weeks.
Thank you for allowing us that additional time.  
There has been a lot going on.  
I do want to talk a little bit today about issue 13, 
actions to improve habitat conditions.
It is the view of the National Heritage Institute 
that the Board has continuing responsibility under the 
public trust doctrine to insure the exercise of water rights 
does not unnecessarily harm public trust resources.  
In addition, under the reasonable use doctrine, the 
Board is required to insure that all methods of diversion 
and use of water are, of course, reasonable and I understand 
reasonable use does change over time.
Thus, it is fully appropriate and perhaps even 
required for the Board to thoroughly examine species and 
habitat conditions in the context of this water rights 
proceeding.
Where there has been harm to public trust resources 
associated with water rights under review, the Board can and 
should take all actions feasible to repair such resources as 
consistent with the Board's Mono Lake order issued last 
September.
Of primary concern in this regard is the restoration 
of the spring-run chinook, once numbering one million 
annually.  The run is now one-half of one percent of its 
former size.
We submitted substantial testimony last summer 
indicating that spring-run chinook are probably eligible for 
Endangered Species Act listing.  This water rights 
proceeding is the appropriate forum for the Board to 
continue improving habitat conditions for spring run and, in 
fact, avoid the need for such a listing, which as you may 
know, is now under review by the National Marine Fisheries 
Service.
To the extent that water rights contribute to the 
degradation of this species, this is the right place to 
consider the public trust remedies for that.  We will be 
updating and revising our recommendations of last summer to 
you on the spring run and we will be providing those to you 
with our written comments.
I want to speak briefly on recommendations that have 
been made that habitat issues generally be dealt with 
outside this proceeding.  It is not clear the legal basis 
for that.  There is ample precedent for this Board to 
consider the full range of remedies to public trust 
resources in the context of a water rights proceeding, and 
we believe those precedents should be followed here.
In addition to specific habitat improvements, the 
water rights decision prepared by this Board in its 
proceeding should fully implement the Bay-Delta accord with 
regard to Category 3.
I feel confident in reporting that we have made 
meaningful progress on the programmatic aspects of Category 
3.  We have consensus on eight projects which are either now 
funded or in the process of being funded, and we are also 
making some progress in putting together a more permanent 
institution for the Category 3 program.
However, we have not been as successful in moving 
forward on the funding side of the equation.  In fact, we 
have made no progress on that side.  
The Metropolitan Water District has come through on 
its commitment to provide ten million dollars annually, and 
that is at this point the only funding that has become 
available for Category 3.  Therefore, it is our 
recommendation to the Board that it provide a default 
mechanism for funding Category 3 activities in the context 
of this water rights proceeding.
We are optimistic and we believe the water users and 
other stakeholders and public players should have an 
opportunity to continue to try to reach consensus on a 
funding mechanism.  However, given that we are nine months 
past the Bay-Delta accord and we have seen relatively little 
progress, it seems there is a case to be made for a default 
mechanism.
I think something that is in place, that insures that 
in the event that consensus is not reached about how to fund 
Category 3, a mechanism should be in place by the Board to 
make such funds available.
I did want to speak very briefly to issue 14 
regarding monitoring.  You may know NHI is preparing a 
workshop for October 2 dealing with ecological standards and 
we are hopeful that that workshop will provide some guidance 
on the monitoring issues and the question of how to evaluate 
effectiveness of actions taken.
We will be providing additional information to the 
Board and staff on that.
Thank you very much for the opportunity to testify.  
I would be happy to answer any questions.
MR. CAFFREY:  Are there questions from the Board 
members?
Anything from staff?
Thank you, Ms. Koehler, very much for being here.
That completes the cards that we have today.  
Let me remind everybody that we will be meeting 
tomorrow.  We have received information there is at least 
one party that will be appearing, Chris Williams from the 
Mountain Counties Water Resources Association. 
If it is like last time, we don't expect many people 
to ask to speak, but it is a possibility, so we will be 
convening tomorrow at nine a.m. in our hearing room across 
the street.
The other thing I want to announce to you today, 
because I suspect that a number of you will not be here 
tomorrow, is that you can expect another notice from us in 
short order based on what you have pointed out today.  
We will deal at least with the points that Mr. Pettit 
suggested to us with regard to a deadline for getting in 
your CEQA alternatives, and I believe your other suggestion, 
Mr. Pettit, is for a workshop on the barriers.
Is that correct?
MR. PETTIT:  Yes, that is the one I indicated I 
thought there was a positive indication that we should hold, 
and, of course, there have been suggestions for several 
others last month and again today.
MR. CAFFREY:  You will have to give us your thoughts 
on the rest of those that were taken under submission, and 
I'm sure there will probably be workshops on some of those 
as well.
I would think we would have a notice out certainly 
within a couple of weeks or possibly sooner.
MR. PETTIT:  Probably not sooner, but I think that 
may be a reasonable time frame.
MR. CAFFREY:  So, you all will be kept well informed 
as to our further workshop proceedings in this matter 
throughout the fall.
So, with that then, we may see some of you tomorrow 
and some we may not, but we will be in our own hearing room 
at nine a.m. 
Thank you all for attending today.  We appreciate 
your attending.
(The workshop was adjourned.)





















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