Title
Consider recommending that the Board of Directors recommend that the Board of Supervisors adopt a resolution to approve the Fiscal Year 2026-27 (FY27) Groundwater Monitoring Program Regulatory Fees of $36.41 per non-de minimis well for Annual Well Registration Renewal, $64.82 per non-de minimis well for Groundwater Extraction Reporting, $196.13 per non-de minimis well for Groundwater Level Monitoring, and $130.76 per non-de minimis well for Groundwater Quality Monitoring.
Report
RECOMMENDATION:
It is recommended that the Monterey County Water Resources Agency Finance and Administration Committee recommend that the Board of Directors recommend that the Board of Supervisors adopt a resolution to approve the Fiscal Year 2026-27 (FY27) Groundwater Monitoring Program Regulatory Fees of $36.41 per non-de minimis well for Annual Well Registration Renewal, $64.82 per non-de minimis well for Groundwater Extraction Reporting, $196.13 per non-de minimis well for Groundwater Level Monitoring, and $130.76 per non-de minimis well for Groundwater Quality Monitoring.
SUMMARY:
This item presents an overview of the Monterey County Water Resources Agency’s Groundwater Monitoring Program regulatory fees and a proposed revision to the adopted Fiscal Year 2026-27 fees as a result of recently enacted Assembly Bill 2728.
Approval of the recommended action by the Finance and Administration Committee will result in this item being moved forward to the Board of Directors for their consideration of a recommendation to the Water Resources Agency Board of Supervisors to consider adoption of a resolution with new Fiscal Year 2026-27 Groundwater Monitoring Program regulatory fees that apply only to wells that extract over two acre-feet of water per year for domestic purposes.
DISCUSSION:
Prior to 2025, the Monterey County Water Resources Agency (“Agency”) conducted groundwater monitoring across portions of the Salinas Valley in a discretionary manner as funding allowed. However, with passage of the Sustainable Groundwater Management Act (“SGMA”) in 2014 came the establishment of local groundwater sustainability agencies (“GSAs”) and a need for consistent, reliable collection of groundwater and well data to develop, implement, and monitor progress of Groundwater Sustainability Plans (“GSPs”). In the interest of improving operational efficiency and reducing costs, some local GSAs have chosen to leverage the data collection, analysis, management, and reporting expertise of the Agency rather than creating a separate, parallel, monitoring program. This approach was solidified through approval and adoption of Agency Ordinance No. 5426 and the Groundwater Monitoring Program Manual by the Board of Supervisors in October 2024. The Agency’s Groundwater Monitoring Program (“GMP”) comprises four data collection and monitoring services that, collectively, produce the data necessary to meet the rigorous reporting requirements mandated by SGMA to maintain local governance and oversight of groundwater resources.
The Agency began implementation of the reconceived GMP in 2025, expanding monitoring activities to cover areas within the Salinas Valley Groundwater Basin that are within the jurisdiction of the Salinas Valley Basin Groundwater Sustainability Agency (“SVBGSA”). Under the GMP, well registration and groundwater extraction reporting requirements for most well owners within the area historically monitored by the Agency remain largely the same as they have been since the 1990s. New well registration and extraction reporting requirements have been applied to some well types (e.g., small water systems) and throughout the expanded monitoring area. Also new in 2025 were the GMP Regulatory Fees (“Fees”), which were adopted to ensure program reliability. The Fees are Proposition 26 regulatory fees and are imposed for regulatory costs that do not exceed the reasonable cost of providing the monitoring service. Proposition 26 fees can be adopted at any time through the approval of the respective legislative body.
On August 5, 2025, the Board of Supervisors of the Monterey County Water Resources Agency (“Board”) adopted Resolution 25-249, adopting the Fiscal Year 2025-26 (“FY26”) GMP Regulatory Fees. Subsequently, the SVBGSA subsidized the FY26 Fees for all well owners using grant funding.
On May 19, 2026, the Board adopted Resolution 26-143 and the Fiscal Year 2026-27 (“FY27”) GMP Regulatory Fees of $21.86 per well for Annual Well Registration Renewal, $64.82 per well for Groundwater Extraction Reporting, $117.68 per well for Groundwater Level Monitoring, and $73.92 per well for Groundwater Quality Monitoring. The Agency has not yet billed well owners for the FY27 Fees.
On September 30, 2026, Governor Gavin Newsom approved Assembly Bill 2728 which in relevant part added Section 53759.5 to the California Government Code. Pursuant to Section 53759.5, a local government that imposes a fee, levy, charge, or exaction for groundwater monitoring or management, including but not limited to a groundwater sustainability agency, may, upon making specified findings, exempt de minimis extractors from payment of the fee, levy, charge, or exaction. For the purposes of Section 53759.5, “de minimis extractor” means “a person who extracts, for domestic purposes, two acre-feet or less per year” which is the same meaning as in Section 10721 of the Water Code.
If the Board finds both that (1) groundwater monitoring activities for which the FY27 Fees are imposed directly benefit parties other than de minimis extractors; and (2) any benefits received by de minimis extractors as a consequence of providing the groundwater monitoring activities occur incidentally and without additional cost to the parties upon whom the FY27 Fees are imposed, the regulatory cost associated with the GMP will be redistributed to only non-de minimis extractors (Attachment 1).
The historical and current extraction of groundwater by de minimis water users is not the primary contributor to groundwater conditions that have resulted in the need for a groundwater monitoring program to investigate, quantify, and monitor impacts within the Salinas Valley Groundwater Basin and meet regulatory compliance requirements. The GMP services would be required even without pumping from de minimis well owners and the cost of the GMP would remain the same even if there were not de minimis users, thus any benefit received by de minimis users from the existence and implementation of the GMP is incidental.
If the above findings are made and the Board exempts de minimis extractors from payment of the FY27 Fees, said Fees will be as follows: Annual Well Registration Fee of $36.41 per non-de minimis well; Groundwater Extraction Fee of $64.82 per non-de minimis well; Groundwater Level Monitoring Fee of $196.13 per non-de minimis well; and Groundwater Quality Monitoring Fee of $130.76 per non-de minimis well.
OTHER AGENCY INVOLVEMENT:
The Agency collaborates with the SVBGSA to determine the scope and timing of monitoring activities that comprise the GMP.
FINANCING:
Funding for the GMP is part of the Agency’s FY27 Adopted Budget. The total regulatory cost for the GMP in FY27 is estimated at $802,000. Sufficient appropriations and estimated revenues in Fund 1501 are included in the FY27 Adopted Budget.
Prepared by: Amy Woodrow, Senior Water Resources Hydrologist, (831) 755-4860
Approved by: Ara Azhderian, General Manager, (831) 755-4860
Attachments:
1. Resolution