Page 9 - Beaumont Basin Watermaster
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judgment is to know that there will be a water supply ready to use by
                              the  public  water  supplier  when  property  builds  out  parcel  by  parcel,
                              Markman explained. It was never meant to be an early transfer from
                              overlying  to  appropriate  use  because  a  developer  with  an  economic
                              motive makes a transfer ten years before construction. During the ten-
                              year period, all the appropriators not in that service area are not going
                              to receive their proportionate share of the unpumped overlying water.
                              The purpose, Markman continued, is to make water available when the
                              project  is  built;  the  water  is  not  there  to  move  abstractly  and  use
                              anywhere wanted – that is an inflated water right – the other pumpers
                              get  nothing  from  that,  which  is  directly  contrary  to  the  rule  adopted
                              indicating a pro-rata share of unpumped water. This boils down to who
                              gets to use more water, Markman stated. The language of the judgment,
                              Markman pointed out, states that when potable water is supplied to be
                              put to use – not to be put to use 10 years later – that’s the reason for
                              the  accounting  mentioned  by  Mr.  Jaggers,  he  said.  In  most
                              adjudications,  Markman  continued,  the  conversion  occurs  when  the
                              demand is created for the appropriative water from the water supplier.
                              He acknowledged the judgment is ambiguous, but he  believes  it has
                              always meant that the water is ready to be supplied when it converts.
                              He indicated support for Mr. Jaggers’ position and urged the Committee
                              to take a hard look at the policy and understand its implications – an
                              add-on  water  right  that  could  diminish  someone  else’s  due  to  early

                              Mr. John O’Hanian from Oak Valley Partners, the subject overlyer of the
                              conversation,  addressed  the  Committee.  He  indicated  the  overlyers
                              have always felt that they had rights that were being taken advantage
                              of.  The  transfer  to  YVWD  is  in  expectation  of  water  service  to  each
                              homebuyer  with  the  commitment  of  a  will-serve  letter  and  20-year
                              supply. To make the conversion when the meter service is turned on
                              does  not  make  sense  to  the  developers,  he  said.  It  makes  sense  to
                              transfer the appropriative right to the district which will serve the water.
                              He requested that any adjustment to policy will make sure the overlyer
                              retains the right to its annual production.

                              In  response  to  Chair  Vela,  Mr.  Blandon  noted  that  groundwater
                              production and annual basin report must be submitted to the state by
                              April 1. Approval of the production side of the report could be done at
                              the March 27 meeting with a draft annual report attached, he said and
                              suggested documenting the transfers to YVWD but not including them
                              as part of the accounting until the issue is resolved.

                              Member Jorritsma said he realized that with the accounting as it had
                              been done, he would be giving up some of his unused overlyer supply
                              and noted that the person who is taking that supply is also irrevocably
                              committing himself to provide that water indefinitely to that particular

               BEAUMONT BASIN WATERMASTER COMMITTEE - MINUTES 2019-03-06                          PAGE 6 OF 8

                                        Beaumont Basin Watermaster - March 27, 2019 - Page 9 of 58
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