ITEM 3: REQUEST FROM THE CALIFORNIA REGIONAL WATER QUALITY CONTROL BOARD, CENTRAL VALLEY REGION, FOR AN ADDITIONAL $800,000 FROM THE STATE WATER POLLUTION CLEANUP AND ABATEMENT ACCOUNT (ACCOUNT) TO SUPPLEMENT MONEY APPROVED IN STATE BOARD RESOLUTION NO. 95-14, TO IMPLEMENT REMEDIATION OF PENN MINE

DISCUSSION: On December 5, 1997 the Regional Water Quality Control Board, Central Valley Region, (Regional Board) adopted Resolution No. 97-264 (Attachment #1) which authorized the Executive Officer to apply to the State Water Resources Control Board ( State Board) for an additional $800,000 from the Account to supplement the amount previously approved to implement remediation at Penn Mine. With the additional funds, the total amount approved would be $5,800,000 leaving $5,000,000 available to meet the Regional Board obligation provided in the settlement agreement, dated February 28, 1997 between the Regional Board, East Bay Municipal Utility District (EBMUD), the Committee to Save the Mokelumne River, the California Sportfishing Protection Alliance, and State Board (Attachment #2).

Furthermore, the Regional Board has requested the period for remediation be extended two years to construct the Penn Mine Long Term Solution project (project), and an additional five years for post closure activities.

The Staff Report included with the Regional Board Resolution provides a brief history of recent events related to Penn Mine, describes the project that has been implemented, and provides a summary of the project costs.

Prior to this request the Account has paid $2,013,500 for remediation activities at Penn Mine:

Project No.	Amount Paid
C/A 62	$573,170
C/A 74	$ 49,000
C/A 120	$ 50,000
C/A 121	$354,109
C/A 138	$987,243
Total	$2,013,522

POLICY ISSUE: ould the State Board approve $800,000 from the Account to fund the request made by the Regional Board.

FISCAL IMPACT: October 1, 1997 the Account has a cash balance of at least $5,971,156 and there is $11,855,600 committed to cleanup and abatement activities. Approximately $7,408,200 will be paid during Fiscal Year 1997/1998 (FY 97/98) for the current approved project and $3,882,800 will be deposited to the Account. The estimated cash balance at the close of FY 97/98 is $2,445,700 if no new projects are approved. Using the same criteria for FY 98/99 the estimated cash balance on June 30, 1999 is $759,300.

Although the Account is over committed, most funds will be disbursed over extended periods and we are confident the Account will maintain a positive cash balance at all times. An additional commitment of $800,000 over the next seven years should not jeopardize the security of the Account.

Account funds currently available for Penn Mine (4,228,800) should fund the project costs through FY 98/99.

RWQCB IMPACT: Yes, Central Valley Region.

STAFF RECOMMENDATION: We recommend that the State Board adopt the proposed resolution approving a commitment of $800,000 and extend the project period through June 30, 2005. This commitment will provide the $5 million the Regional Board agreed to spend for remediation at Penn Mine as specified in the settlement agreement.

[Attachments are not available electronically, but can be obtained by calling Alan Garbutt at (916) 227-4440.]

DRAFT 12/22/97

WHEREAS:

1. Discharges of acid drainage from Penn Mine can impair beneficial uses of Camanche Reservoir and the Mokelumne River; and

2. On March 16, 1985 the State Water Resources Control Board adopted Resolution No. 95-14 approving expenditure of $5,125,000 over three years from the State Water Pollution Cleanup and Abatement Account (Account) for cleanup activities at Penn Mine; and

3. The Regional Water Quality Control Board, Central Valley Region (Regional Board) has expended approximately $928,500 of these funds to develop an Environmental Impact Report (EIR), to treat acid mine drainage, and provide additional site maintenance at Penn Mine, thereby leaving a remainder of $4.2 million; and

4. On February 28, 1997 the Regional Board adopted Resolution 97-039 certifying the Penn Mine EIR with the preferred alternative (5A) known as the Penn Mine Long Term Solution project (project); and

5. On February 1997 a settlement was reached such that the Regional Board and East Bay Municipal Utilities District (EBMUD) agreed to pay up to $10 million towards the remediation of abandoned Penn Mine through implementing the project; and

6. The Regional Board has determined that the project will take two years with completion of construction activities by November 2000, and will continue thereafter with site operations, maintenance and monitoring for at least another five years; and

7. Past funding agreements between EBMUD and the Regional Board have resulted in equal sharing of costs associated with the Penn Mine projects; and

8. The Account is currently over committed. To ensure that it remains solvent, any major projects funded by the Account must be segmented; and

9. It has been determined that an additional commitment of $800,00 over the seven year period will not jeopardize the security of the Account.

THEREFORE BE IT RESOLVED THAT:

The State Water Resources Control Board:

1. Allocates an additional $800,000 from the Account to supplement State Board Resolution 95-14 which provided $5 million for the Penn Mine Long Term Solution project in accordance with the February 1997 settlement.

2. The project period for the Penn Mine Long Term Solution is extended to June 30, 2005.

3. The Regional Board will segment major procurement to the degree possible, and before entering any contract in excess of $250,000, will obtain approval from the Executive Director to ensure sufficient funds are in the Account to cover the contract.

The undersigned, Administrative Assistant to the Board, does hereby certify that the foregoing is a full, true, correct copy of a resolution duly and regularly adopted at a meeting of the State Water Resources Control Board held on January 22, 1998.

_______________________________

Maureen Marché

Administrative Assistant to the Board