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Director Memorandum No. 18-022                                                      Page 5 of 22



                                     1.1.3  “Annual Basin Groundwater Report” shall mean the annual report
               prepared by the Groundwater Council, to cover topics including but not limited to the following:
               annual production, recharge, environmental issues, exchanges, and all other actions and topics
               material  to  groundwater  conditions  in  the  Basin.    In  preparing  such  report,  the  Groundwater
               Council may consult with, and draw from, data and information provided by the Watermaster and
               Conservation District and other reliable sources regarding annual groundwater conditions. The
               Annual Basin Groundwater Report is not intended to supplement or supplant the annual reports of
               the various Watermasters operating within the Basin that are filed with the Superior Court or any
               Watermasters’ required reporting under the Sustainable Groundwater Management Act (SGMA).

                                     1.1.4  “Basin”  shall  mean  the  Upper  Santa  Ana  Valley  Bunker  Hill
               Groundwater Basin, Sub-basin 8-002.06, as designated in DWR’s Bulletin No. 118, and as its
               boundaries may be modified from time to time through the procedures described in California
               Water Code § 10722.2.

                                     1.1.5  “Groundwater Council” or “GC” or shall mean the Upper Santa
               Ana  Valley  Bunker  Hill  Basin  Groundwater  Council,  the  oversight  body  coordinating  the
               management, replenishment, and preservation of groundwater supply and quality of the Basin.
               The GC shall be composed of representatives of each Party and should they decide to participate,
               a representative of any other groundwater management authority over any portion of the Basin, as
               further provided herein.  The GC’s duties shall include the integration and coordination of the use
               of imported water supplies for replenishment of the Basin, facilitation of implementation of GC
               policies and initiatives through the legal authorities of its members, management of budgeting and
               funding  for  the  maintenance,  development,  and  management  of  regional  groundwater
               infrastructure, and dispute resolution that may occur within or between the Parties or Ex Oficio
               members of the GC.

                                     1.1.6  “BTAC” shall mean the Basin Technical Advisory Committee, as
               originally created under the auspices of the Upper Santa Ana River Watershed Integrated Regional
               Water Management Plan, as such Committee may be modified from time to allow for the additional
               participation of one or more Parties to this Agreement.  The BTAC may be tasked to undertake
               specified actions in support of the GC.

                                     1.1.7   “Effective Date” shall mean the date that a majority of the Parties
               approve of and enter into the Agreement.

                                     1.1.8  “Equitable Allocation” shall mean the manner of determining the
               facilities’ operations and maintenance (“O&M”) costs,  and supplemental water cost, for each
               Party based on the annual approved budget.  This allocation will be performed pursuant to the
               formulas and procedures described in Exhibit B of this Agreement.  The allocation shall determine
               the portion of equitable O&M cost, and the portion of equitable water cost, to be apportioned to
               each Party or other participant for the applicable GC budget year.  These allocations shall also be
               used  to  determine  the  voting  weight  afforded  to  each  voting  member  of  the  GC,  under  this
               Agreement and further procedural processes as may be developed by the GC.

                                     1.1.9  “Ex Oficio participant” shall mean those entities that participate in
               the GC  by virtue of their status  as  plaintiffs or  successors in interest  to plaintiffs in  Western






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