Page 10 - Beaumont Basin Watermaster
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parcel(s). He said he would be willing to sacrifice a little of the overlyer
                              rights if he does not have to make such a commitment.

                              Cahir  Vela  said  he  felt  comfortable  including  language  in  the  annual
                              report that represents the facts that are not currently in debate: letters
                              have  been  received  requesting  the  transfer,  commitment  has  been
                              made to discuss and finalize a policy, and once completed the annual
                              report would be revisited and adjustments made. Member Zoba added
                              that it should be included that the water has been pumped. Mr. Jaggers
                              pointed out that the water, however, was not served to that property.
                              This is the continuing gray area and has not been clearly vetted.

                              Member Zoba expressed concern about the concept posited by Counsel
                              Markman; that the water should be held up for private and free gain.
                              He does not want policy set based on unused overlying water right, he
                              said. At issue is a clear, defined policy to be vetted by the Watermaster
                              as a whole, Jaggers noted. Zoba suggested the two meet as an ad hoc
                              to draft a policy for the next meeting.

                              Accounting for the water pumped by Yucaipa Valley might be a caveat
                              in the annual report, but the real issue is what to do with the acre-feet
                              that was transferred and pumped, Vela noted. It should not come out
                              of YVWD’s storage account, Zoba suggested. Blandon explained that if
                              the report were revised it would be a temporary withdrawal from the
                              account until the issue is resolved, and put back in a subsequent report.
                              Regardless  of  where  the  water  rights  come  from,  the  water  was
                              produced, Blandon pointed out. The state is interested in the amount of
                              water that was produced.

                              Further discussion ensued about the ambiguity of the perfection of the
                              right. Zoba posited that the transfer letter does not create the demand;
                              it creates the relinquishment of a right – that is when the perfection
                              takes place, as someone is forgoing use. Chair Vela agreed this is the
                              ambiguity under discussion. Zoba suggested that if the overlyers could
                              continue to pump the water, there could be a great deal of over- and
                              double production.

                              Jaggers reiterated the request for a policy with a clear path and meets
                              the intent of the adjudication. If not resolved by the next meeting, Chair
                              Vela suggested the engineer submit the minimum report to the state as
                              suggested  by  Mr.  Blandon.  With  Committee  member  consensus,  Mr.
                              Blandon  will  have  said  report  ready  for  approval  at  the  March  27

               BEAUMONT BASIN WATERMASTER COMMITTEE - MINUTES 2019-03-06                          PAGE 7 OF 8

                                        Beaumont Basin Watermaster - March 27, 2019 - Page 10 of 58
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