TIMELINE (1891-Present): 1891 The Arrowhead Reservoir Company was formed by James Gamble (of Proctor and Gamble) and others. It bought up property in and around Little Bear Valley and began dam construction at east end, now State Highway 173 with the intention to capture and transport water off the mountain to low lands. A series of tunnels was begun which would capture the water and bring it to the Little Bear Valley with the intention of turning the valley into a reservoir. 1905 The above property was transferred to subsidiary of the Arrowhead Reservoir Company, the Arrowhead Reservoir and Power Company. Both water and electric power were to be distributed. 1907: Dam finished so that Arrowhead Reservoir and Power Company began to allow natural waters supplied through tunnels to fill dammed off area known as Little Bear Valley. 1911: A series of court decisions culminate making it illegal to transfer water out of the area...thus defeating original purpose of the dam and making it financially impractical to service local residents, since not enough demand. 1921: Arrowhead Reservoir and Power Co. ceased operations due to court decisions banning transfer of water out of the area. At that time Arrowhead Reservoir and Power company had less than 100 electric and water connections. A group of land developers then took over. J. B. Van Nuys and John O'Melveny formed the Arrowhead Lake Company and bought out the Arrowhead Reservoir Co (including the Arrowhead Reservoir and Power Company) and renamed area the area Lake Arrowhead and the Arrowhead Wood respectively. These developers envisioned a Resort Community which would draw the affluent from the lowlands to the mountains. The community would coincidentally use Lake water because that was the only water available and it was readily and cheaply (for free) accessible. But the true income of the developers would come from land sales, not water sales. 1923: ALC formed Arrowhead Utility Co. and there were 103 water users according to the 1978 report of C. R. Brockmeier, made in anticipation of the AUC sale of water rights to LACSD . 1924: According to Railroad Commission findings, Arrowhead Reservoir and Power Co had approximately 98 electric customers and 84 water users. Railroad Commission grants ALC permission to transfer to AUC 2200 gallons per minute of water from Lake Arrowhead, Fletcher and Orchard Springs for use in certified area. No distinction made between domestic and non domestic use. Deed on file with county indicates that ALC transfers beyond its powers a total of 4200 gallons per minute of water for domestic use and electric rights from its other subsidiaries to Arrowhead Utility Co. This March 1924 deed is probably a bogus deed, later subsituted by the Arrowhead Utility Co. possibly during the 60's. The fact that the deed is without authority is confirmed by a subsequent revised decision of the RR Commission in July, four months after the date of the deed wherein the followup decision reiterates that the Commission granted only 2200 gallons per minute. Curiously non domestic use was never transferred and remained with ALC. Nine hole golf course is built during this period next to Grass Valley Lake. (1946-1978) "The Golden Years" 1946: ALC falls into post war receivership and sells 9 hole golf course, land around and under Lake along with Arrowhead Utility Co. (which holds rights to water in lake) to Turf Club. Small 9 hold golf course is continued in use. Public Utilities Commission grants first rate increase to AUC. From 1946 to 1960 Turf Club made many water improvements in the transmission lines. 1960: In October of 1960, Jules Berman, William Newell and Joe D. Brown formed the Lake Arrowhead Development Company and acquired Lake Arrowhead, the Arrowhead Utility Co and purchased the remaining unsold properties in Arrowhead Woods plus an additional 120 acres on the western boundary known as the Dexter property which was subsequently included in the Arrowhead Woods and the "certificated" area. They built the present 18 hole golf course and club house on the site of the old 9 hole golf course. Due to State water quality requirements over the next 5 years two processing plants were planned of which one was built in 1965 near Emerald Bay, now called the Cedar Glen Filter Plant. Under LADC's ownership a major water system improvement program was implemented, upgrading AUC's water supply intake, treatment transmission, storage and distribution facilities. 1967: Boise Cascade merges with Lake Arrowhead Development Co. 1964: Homeowners revolt and demand to have clearly designated lake rights, results in settlement between Lake Arrowhead Development Co, Mutual Service Co and Arrowhead Property owners Association establishing dock rights, swimming and boating and coincidentally sets up 5100 feet above sea level as crisis level for lake below which water utility is barred from withdrawing water for everyone but country club whom it may withdraw 250 a.f. per year. 1970: Water consumption reaches 80% of processing capacity and therefore second previously planned plant construction initiated. 1971: Lake Arrowhead Dev Co buys back interests from Boise Cascade. The second processing plant was put on line near the Bernina Divide Reservoir 1973: Lake Arrowhead Dev Co declares bankruptcy and Boise buys back the interests it sold to LADC in order to protect its investments. In the same year, the State of California demands that the dam be seismically upgraded. 1974 A seven million dollar bond issue was passed by the electorate in November by a 9 to 1 margin for construction of a new dam. 1975 Boise under pressure from Federal Government to divest its nationwide monopolistic holdings and had been under pressure to invest 7 million in a new dam, until electorate came up with the money through the bond issue, sells out interests to newly formed Arrowhead Lake Association, but retains Arrowhead Utility Co..granting ALA right of first refusal to buy it...ALA elects not to buy it for $3,895,000. (A deed from Dam Co. and Boise is attached as an exhibit showing that Dam Co and Boise quit claimed rights in all of water in lake for all purposes to Arrowhead Utility Co -- irony is neither had that amount of rights, possibly had non domestic rights never conveyed in 1924 by ALC to AUC rights). A construction contract was awarded for the new dam. 1978: LACSD is formed by the local electorate for the purposed of acquiring Arrowhead Utility Company and assuming its water distribution responsibilities, purchase in part paid for by the issuance of bonds, and buys Arrowhead Utility Co. LACSD acknowledges as part of that contract that LACC is paying 10 % of the going domestic rate for water and promises to AUC as part of the sale to keep LACC's rates at that ratio in perpetuity. 1978 to Present: LACSD and ALA divide their actions vis a vis the lake up into two functions: ALA acts as policing agency monitoring swimming, boating, dock improvements, speeding, throwing boat races, occasional parties, social events and cleaning up portions of lake weed while LACSD sells as much water as it can from Lake. Both have lost not only the motivation to promote the Resort Community through the maintenance of the Lake, but have formed a competitive stance and refuse to cooperate in any common goal....much less a common goal of fostering the Resort. LACSD drifted so far off the original developers' course of action that a member of its board has been heard to state defiantly, on several occasions, words in substance that ....we will drain the lake dry if we want to...let em try to stop us. Another member of its board at the last meeting of October 10th after two hours of debate and discussion amongst the audience, Gary Valladeo, Dennis Whitney, on how to solve the problem, and after having said absolutely nothing for two hours, spoke up and stated, in substance: I don't talk much but my opinion is (to save the lake) don't flush yellow water. One of five votes on the Board. And so it goes.	HAMILTAIR MARINA
THE 1964 "AGREEMENT" IS PRINTED BELOW VERBATIM. EXHIBITS HAVE BEEN LEFT OUT DUE TO SPACE LIMITATIONS. THE COMPLETE DOCUMENT WITH EXHIBITS IS ON FILE WITH THE COUNTRY RECORDER'S OFFICE. ======================= THE CONTRACT: "Agreement of Settlement and Compromise BETWEEN ARROWHEAD WOODS PROPERTY OWNERS ASSOCIATION, ET AL AND LAKE ARROWHEAD DEVELOPMENT CO., ET AL DATED: AUGUST 22, 1964 Recorded: October 29, 1964 Book 6262, Page 1 San Bernardino, California The name of this Association was changed to "LAKE ARROWHEAD PROPERTY OWNERS ASSOCIATION, in December, 1970. ========= AGREEMENT OF SETTLEMENT AND COMPROMISE THIS AGREEMENT OF SETTLEMENT AND COMPROMISE made and entered into in duplicate as of this 22nd day of August, 1964, by and between ARROWHEAD WOODS PROPERTY OWNERS ASSOCIATION, sometimes hereinafter referred to as the "Association", SIDNEY B. BISNO, JUNE B. BISNO, JOHN CHRISTOPH MOLLER, JR., ELIZABETH YVONNE MOLLER, and LOUIS E. PURMORT, herein jointly known as "plaintiffs" and LAKE ARROWHEAD DEVELOPMENT CO., a California corporation, sometimes hereinafter referred to as "Development Co.", and ARROWHEAD MUTUAL SERVICE CO., a California corporation, sometimes hereinafter referred to as "Service CO.", and jointly as "defendants"; WITNESSETH, that: WHEREAS, plaintiffs filed an action against the defendants in the Superior Court of the State of California, in and for the County of San Bernardino, being No. 112002 in the records of said Court, and WHEREAS, the purpose of said action is to establish the right of property owners in Arrowhead Woods, as hereinafter defined, to certificates of membership in the defendant Service Co., to impress a trust on certain lands owned by Service Co. which are referred to as the reserve strips and the reserve strip additions and are hereinafter defined, and on certain rights owned by Service Co. in Lake Arrowhead, hereinafter referred to as the "Lake", which is owned by the defendant Development Co., and for declaratory relief and for an accounting, and the parties now desire to settle and compromise said action, to dismiss the same, and exchange mutual releases, and Page 1 ======= WHEREAS, it is the desire of all of the parties by this agreement to determine and establish certain rights in the plaintiffs and in other property Owners of lands in Arrowhead Woods in the reserve strips, the reserve strip additions, and in the Lake, all pursuant to the@ terms of this agreement, NOW, THEREFORE, the parties agree as follows: 1. The term "Arrowhead Woods" means lands in the County of San Bernardino, State of California, situate in Township 2 North, Range'3 West, San Bernardino Base and Meridian, lying within the boundaries shown upon the map which is attached hereto marked "Exhibit 1". Said Exhibit 1, and Exhibit 2 which are attached hereto are hereby referred to and incorporated in this agreement. -2. "Reserve strips" are certain strips of land bordering the major portion of the Lake and lying within the contour lines 5,122 feet above sea level to 5,132 feet above sea level as herein defined, and "reserve strip additions" are certain strips of land bordering the major portion of the Lake and lying within the contour lines 5,100 feet above sea level to 5,122 feet above sea level, all as more particularly described in the deeds listed on Exhibit 2 under the heading "Reserve Strip and Reserve Strip Addition Deeds". Said reserve strips and said reserve strip additions are now and shall remain subject to the servitudes imposed thereon by the terms of the respective deeds listed in said Exhibit 2, and are collectively hereinafter called the "strips". 3. Development Co. and Service Co. hereby grant without warranty express or implied to all owners of lots in Arrowhead Woods which at any time heretofore have been owned by Service Co., Development Co., Los Angeles Turf Club, Inc., Arrowhead Lake Corporation or Arrowhead Lake Company, and to the successors and assigns of such owners, and subject to all recorded conditions, restrictions and reservations, the following non-exclusive rights, easements and servitudes in, Page 2 ========== over, upon and with respect to the reserve strips and reserve strip additions, and the Lake, viz: (a) The right for themselves, their lessees and house guests to use the strips for private park and reasonable recreational purposes, and for ingress and egress by foot travel but not for commercial or business purposes; (b) The right to have the strips be and remain free of any noxious thing and of any trade or business kept, maintained or permitted upon said premises, nor shall any livestock of any kind, including live poultry, be kept, permitted or maintained upon the strips. (c) The right for themselves, their lessees and house guests to use the Lake for reasonable recreational purposes, including but not limited to boating, fishing, swimming and bathing, but not for business or commercial purposes, and subject to the rights expressed in paragraph 6 of this instrument and the right in Development Co. and Service Co. or either of them to promulgate and enforce reasonable regulations designed to promote the safety, health, comfort and convenience of persons in or upon the Lake or in the vicinity thereof with respect to the conduct of such activities. 4. Any act or omission inconsistent with said easements and servitudes or any of them and any violation or breach of any right, condition and/or restriction expressed herein may be prevented by injunction and such remedy may. be availed of by not less than three owners of lots or portions of lots in Arrowhead Woods. The remedies herein contained shall be cumulative and one shall not be exclusive of the other. 5. Development Co. and Service Co., or either of them shall not increase the height of the dam (which created the Lake) above its present height, nor voluntarily impound water in the Lake to an elevation in excess of 5,108 feet above sea level as herein defined, unless in either case, such act shall be required by Governmental order or regulation. Page 3 ======== The term "Sea Level" shall be and shall be construed to be that certain datum plane or point which is 5,122 feet below the level of that certain bench mark which is the top of a two-inch iron pipe situate vertically in a concrete block located 56 feet due South of the corner common to Sections 15, 16, 21 and 22 in Township 2 North, Range 3 West, San Bernardino Base and Meridian, in the County of San Bernardino, State of California. 6. Development Co. and Service Co. or either of them are entitled to charge lot owners reasonable fees for permitting piers and docks to be located and kept on the strips or any of them and/or the Lake and are also entitled to charge reasonable fees for licensing of boats to be used on the Lake and for rental slips; and license agreements hereafter entered into between the par-ties covering boat or dock licenses shall be consistent with the terms of this Agreement. 7. As used herein, the term "slip" shall mean space on a dock or pier adapted to the mooring of one boat while such boat is floating on the Lake. On December 31, 1961 there were approximately 835 slips on the Lake, in addition to slips used or held for rental of boats to the public. Development Co. and/or Service Co. shall never permit the total number of slips on the Lake at any one time to increase over 1,285 (835 + 450) except that such number may be increased by the aggregate of the following: (a) One slip for each lake front lot in Arrowhead Woods which was owned by Development Co. on January 1, 1962, whether then or thereafter subdivided, and for the purposes of this paragraph all lots on the "Peninsula" described on Exhibit 2 shall also be deemed to be lake front lots. (b) 15% of the number of other lots in Arrowhead Woods contracted to be sold by Development Co. after January 1, 1962. (c) Any slips in front of "Hamiltair" Subdivision. Page 4 ======== (d) Each owner of a lot in Arrowhead Woods purchased by him or his predecessor prior to January 1, 1962, who did not on December 31, 1961, have, a dock or pier, and whose lot at the time of application for a dock and/or pier shall be improved with a residence, may hereafter at the option of Development Co. and Service Co. be allowed one slip, or with the approval of the Association when deemed equitable and for the best interests of the community, more than one slip. 8. A large number of owners of lots in Arrowhead Woods have built residences on such lots. Such lots so improved with residences are herein called "Improved lots". Many of the owners of improved lots now have docks on the Lake and in some cases also piers and appurtenances on the strips. Each owner of such improved lot who now has a dock upon the Lake and/or a pier upon the strips or any of them shall have the right to continue to have such dock and/or pier, together with appurtenances upon the Lake and strips and may transfer such right to a bona fide purchaser of such improved lot subject to the right of Development Co. and/or Service Co. to require the relocation and/or alteration thereof or substitution, as herein provided, when reasonably necessary for improvement of docking facilities on or access to the Lake, provided, further, that the Development Co. and/or the Service Co. shall, except in the case of piers or docks for Lake front lots, have the right to require the substitution of a slip or slips in a multiple-slip dock or marina in lieu of any then existing dock and/or pier. Such right of alteration and/or relocation or substitution shall not be exercised before January 1, 1070, and shall not be arbitrarily required. Any such alteration and/or relocation or substitution shall be made to a location or facility as close to the dock location now existing as is practicable. In case the Development Co. requires substitution of a slip or slips in a marina or multiple-slip dock for a private dock, the Development Co. upon transfer,of the private dock to it will pay to the owner the cost thereof less ten (10%) percent of such cost for each year since the date of construction of such dock. 5 ========= Any owner of a lot in Arrowhead Woods whose pier or dock now existing would be affected by any such proposed substitution shall have the right to have determined by arbitration (as hereinafter provided) any or all of the following: I (a) whether such substitution is reasonably necessary for improvement of docking facilities on or access to the Lake; and (b) whether the substitution proposed is to a location or facility as close to the existing dock location as is practicable. Such substitution is hereby agreed to be reasonably necessary, and such necessity shall not be arbitrated as to marinas or multiple-slip docks which shall be installed after January 1, 1970 in the locations marked "1", "2", "3" and "4" shown on Exhibit 3 attached hereto. The decision of the arbitrators shall be final, and if such decision is in the negative as to any of the arbitrated questions, the proposed substitution shall not be made. 'The right of a lot owner, or group of lot owners, as hereinafter set forth, to have the matter submitted to arbitration shall be exercised by the lot owner or group of lot owners requesting the same and giving the name and address of an arbitrator requested by him or them. The Development Co. or the Service Co. shall thereafter notify the lot owner, or group of lot owners, of the name and address of an arbitrator desired by it. The two arbitrators so selected shall select a third arbitrator between them. In the event they are unable to do so the matter shall be presented to the American Arbitration Association who shall select a third arbitrator. The vote of any two of the three arbitrators shall be sufficient for an award. In the event the Development Co. or Service Co. requires simultaneously the substitution affecting a group of two or more existing docks, there will be with respect to said substitution only one arbitration proceeding as hereinabove provided. Page 6 =========== Any such lot owner or purchaser as a condition to the exercise of such rights shall pay such reasonable fee and execute such reasonable application and permit a's may then be generally required by the Development Co. and/or Service Co. for the maintenance of docks, piers and appurtenances on the Lake and strips. Any pier or dock hereafter installed on the reserve strip additions shall be so located as to preserve at the 5,100 foot elevation a clear separation of at least 8 feet between such pier or dock and any pier or dock existing on January 1, 1962, unless other-wise agreed between the parties directly affected. 9. No person, except by agreement of the Association and the Development Co. will in the future be permitted to have a dock or boat on the Lake, or pier on the reserve strip additions who is not the owner of improved residential property in Arrowhead Woods, but this paragraph shall not apply to rental boats (450 maximum), to boats used in law enforcement or the enforcement of said regulations, nor to excursion boats or work boats, nor to boats entered in sanctioned boating events on the Lake, nor boats (not exceeding 50 in number at any time) specially authorized by Development Co. to use the Lake. Subject to the provisions of Paragraph 7 nothing in this agreement contained shall effect any right of present or future owners of unimproved lots in Arrowhead Woods to put boats on the Lake on a daily basis, or to rent slips on an availability basis, nor preclude the exercise of such rights. Buyers of lots sold in that portion of Arrowhead Woods known as "Grass Valley" will not be given the right by Development Co. or Service Co. to own piers or docks on the Lake, but may be given the right, subject to compliance with paragraphs 7 and 9 of this agreement to rent slips in multiple-slip marinas. 10. At the present time it is uncertain as to many roads in Arrowhead Woods whether they are or are not public roads. Development Co. and Service Co. shall diligently proceed in cooperation with the County of San Bernardino to determine which roads in Arrowhead Woods are public, and shall conclude Page 7 =========== such determination within six months after date of this agreement. As to such roads which are not presently public roads, Development Co. and Service Co. shall offer to the County of San Bernardino to dedicate to public use such of said roads as are owned by Development Co. and Service Co. or either of them, and shall so dedicate such of said roads as said County will accept. 11. At the present time, title to the trees and other shrubs on lots in Arrowhead Woods is vested in Service Co. Within one year from date, Service Co. will quitclaim the trees and shrubs on any lot in Arrowhead Woods to the owners of such lot who request such conveyance and tender the cost of recording said quitclaim. Such quitclaim shall be subject only to an express provision that the property owner will not cut down, remove or alter any living tree unless first approved by an architectural committee appointed by Service Co. The Association shall have the right to appoint and maintain one member on such committee. 12. The Association shall have the right to select and maintain, at all times, two members on the Board of Directors of the Service Company. The Service Company may now, or at any time hereafter, increase the total number of directors, and this right shall be without restriction or limitation. No such increase in the total membership of the Board of Directors shall entitle the Association to any greater representation on the Board than the two members, as hereinabove stated. 13. Development Co. is and shall be only permitted to voluntarily and intentionally reduce the level of Lake Arrowhead below 5,100 feet above sea level for certain restricted purposes under the reserve strip addition deeds and specifically, it is not permitted when the surface level of the Lake is below 5,100 feet, to use such water for any purpose other than domestic use in Arrowhead Woods and for fire protection in Arrowhead Woods or the adjoining mountain areas, but the parties agree that Development Co. may, when the level of the Lake is below 5,100 feet above sea level, also use the waters of the Lake for Page 8 ============= watering the golf course located in Grass Valley so long as the amount of water so used for said golf course does not exceed 250 acre feet during any one calendar year (which is approximately 4 inches of water off the surface of the Lake at 5,100 feet elevation). Development Co. agrees to accurately meter all non-domestic water and annually furnish the Association on or before March first of each year with a certified copy of its records for the previous calendar year showing the amount of such non-domestic water so used in such year. 14. The action shall be dismissed with prejudice upon recordation of this agreement and the attorneys for the respective parties are authorized and directed to so dismiss the action upon such recordation. Such dismissal shall not preclude future enforcement of the provisions of this agreement. It- is the intent of the parties in entering into this agreement to settle specifically all disputes which have resulted in the filing of said action, and all disputes that now exist between them pertaining to the strips or the Lake, or pertaining to membership in Service Co. In connection with the settlement of such disputes Development Co. and Service Co. expressly agree that in the placing of locations for new piers or docks or in exercising their rights under paragraph 8 requesting the alteration and/or relocation or substitution of docks or dock space, they will fairly and' equitably exercise such rights and will not be biased or prejudiced against a lot owner because he may be one of the plaintiffs in said action or because he is now or may at one time have been or may in the future become a member, director or officer of the Association. 15. This agreement is to be binding upon and inure to the benefit of the successors, lessees and assigns of the parties hereto and it is the intention of the parties hereto that this agreement should be recorded so as to constitute notice to any buyer of property within the exterior bounda6es of Arrowhead Woods, including the strips and the Lake. Page 9 ============ 16. This agreement may be amended at any time or times by a written agreement executed by Development Co., Service Co. and the Association and recorded in the office of the County Recorder of San Bernardino County, California. IN WITNESS WHEREOF the parties hereto have executed this agreement as of the day and year first hereinabove written. LAKE ARROWHEAD DEVELOPMENT CO. (SEAL) By: A. M. POWELL, Vice-President And: E. C. MOWER, Secretary "Development Co." ARROWHEAD MUTUAL SERVICE CO. (SEAL) By: A. M. POWELL, Vice-President And: E. C. MOWER, Secretary "Service Co." "DEFENDANTS" ARROWHEAD WOODS PROPERTY OWNERS ASSOCIATION (SEAL) By: ORRIN W. FOX, President And: WILLA HODGES, Secretary "Association" SIDNEY B. BISNO (Sidney B. Bisno) JUNE B. BISNO (June B. Bisno) JOHN CHRISTOPH MOELLER, JR. (John Christoph Moeller, Jr.) ELIZABETH YVONNE MOELLER (Elizabeth Yvonne Moeller) LOUIS E. PURMORT (Louis E. Purmort) "PLAINTIFFS" Page 10	In 1924 the Railroad Commission granted the Arrowhead Reservoir Company the right to sell water rights of 2200 gallons per minute to the Arrowhead Utility Company. That Order is posted in this Documents section. There also is a provision that the ALC will file a copy of their subseqent 2200 gallon per minute deed with the Commission in a month. That copy is not available; it is unknown if it was filed, but assumed it was. There appears however in the public records of San Bernardino County a deed which is dated two weeks later in 1924 in which the Arrowhead Lake Company deeded over 4200 gallons per minute of Lake Arrowhead Water Rights to it wholly owned subsidiary the Arrowhead Utility Company . This deed is contrary to the grant and it is difficult to believe that it was filed with the Commission in thirty days because, 4 months later, in July of 1924 the Commission issued a subsequent order repeating the 2200 gallon grant of water...clearly contradicting the ALC deed issued 4 months earlier. Clearly either ALC drafted a deed contrary to its authority and either filed it with the RR Commission and the Commision did not catch the "error" (doubtful), drated it and did not file it with the Commission (possible) or years later the original deed was pulled and this bogus grant substituted. (Probable) In other words, it is possible that the purported 1924 deed now on file, is a bogus deed, substituted later by the ALC, or the Turf Club or the Development Co or even Boise Cascade. However, whether bogus or not, this deed is clearly in excess of the athority granted by the Rail Road Commission. For 80 years AUC then LACSD, the two involved utility companies, have been drawing 2 to 3 times a much water from Lake Arrowhead than was permitted by the Railroad Commission in its original and unchanged grant in 1924. AUC illegally sold water in excess of its grant and it was the sole Utility Company to distribute water to the woods area from that time until its interests under this 1924 grant were purchased by LACSD. (LACSD also claims that it succeeded to additional rights under 1 quit claim deed, dated 1975 from Boise Cascase and Arrowlake Dam Company -- who appear to have never had any water rights to convey and chain of title has never been proved that they did) This is the infamous deed which inflates the amount of gallons per minute authorized by the Rail Road Commission from 2200 gallons per minute to 4200 gallons per minute. That deed is reprinted below: GRANT DEED ARROWHEAD LAKE COMPANY, a corporation organized under the laws of the State, of Delaware and having a place of business in the City of Los Angeles, State of California, hereinafter designated as the Grantor, does hereby grant to ARROWHEAD UTILITY COMPANY, a corporation organized under the laws of the State of California and having its principal place of business in the City of Los Angeles, Los Angeles, California, hereinafter designated as the Grantee, its successors and assigns, the following: The right to take, for re-sale for domestic use, a flow and/or volume of water, not exceeding 100 gallons per minute, out of Fleming Creek, a stream on the south side of Lake Arrowhead, formerly known as "Little Bear Reservoir", and located in San Bernardino County, California, which said stream has its mouth or outlet a point on the shore line of Lake Arrowhead, said Lake Arrowhead covering portions of Sections 9, 10, 14, is, 16, 21 and 22, in Township 2 North, Range 3 West, S. B. B. and M., said outlet being about a half mile southeasterly of the Northwest corner of Section 22. The right to take, for re-sale for domestic use, a flow and/or volume of water, not exceeding 100 gallons per minute, out of Orchard Creek, a stream which has as its mouth or outlet along the shore line of said Lake Arrowhead at a point about 3500 feet east of the Northwest corner of said Section 22. The right to take, for re-sale for domestic use out of said Lake Arrowhead, at a point approximately 3,000 feet north of and about 900 feet west of the Southeast corner of said Section 15, an amount of water which shall not exceed an amount equal to a constant flow of 2,000 gallons per minute. The right to take, for re-sale for domestic use , the waters of Little Bear Creek and/or any spring, water and,/or seepage flowing in or on the East Half of the West Half of said Section 24. The right to take, for re-sale for domestic use out of said Lake Arrowhead, at a point on the north of said Lake Arrowhead approximately 1500 feet west of the Northeast corner of said an amount of water which shall not exceed an amount equal to a constant flow of 2,000 gallons per minute. IN WITNESS WHEREOF, the said Arrowhead Lake Company has caused its corporate name to be hereunto subscribed and its corporate seal affixed t his 28th day of March, 1924, by its President and secretary, in pursuance of a resolution passed by the Board of Directors of said corporation at a legal meeting thereof duly convened and held on the fifth day of October, 1923. ARROWHEAD LAKE COMPANY (Corporate Seal) BY: Morgan Adams President. BY: Harry Lee Martin Secretary State of California ) ) ss County of Los Angeles ) On this 28th day of March; 1924, before me, V. McEwen, a Notary Public in and for said County, personally appeared Morgan Adikas, known to me to be the President, and Harry Lee Martin, known to me to be the Secretary of ARROWHEAD LAKE COMPANY, the corporation that executed the within and foregoing instrument on behalf of the corporation therein named, and acknowledged to me that such corporation executed the same. WITNESS my hand and official seal the day and year in this certificate first above written Notarial Seal V. McEwen Notary Public in and for the County of Los Angeles, State of California No. 151 "Endorsed" Recorded at Request of Grantee July 3, 1924, at 57 min. past 11 A.M., in book 847, Page 176 of Deed Records San Bernardino County. Fulton G. Teraud, County Recorder ********************************************************* COLUMNS CONTINUE BELOW...SCROLL DOWN *********************************************************
This is the fax cover sheet from Ms. McGonigle at the LACSD in response to my Freedom of Information Act request for copies of all contracts with LACSD and it predecessors and any other parties showing rates and delivery terms regarding water to the Lake Arrowhead Country Club. The a page 21 of the sales contract AUC-LACSD had been delivered and I had requested page 22 since 21 was incomplete and at that time asked Ms. McGonigle to make sure that there were no other outstanding papers setting rats and deliver terms between LACSD and its predecessors. Her response was that the AUC-LACSD contract, pages 21 and 22 was all that LACSD had or was aware of. These pages 21 and 22 are the "contract" to which Dennis Whitley, President of LACSD Board refers to. See my analysis under History and LACC that these price contract terms would probably be held by a court to be void and against public policy; see also my analysis that sales for non domestic use are not within AUC's authority under 1924 Rail Road Commission Order (A Copy appears in this Document Section).	PORTION OF AUC-LACSD CONTRACT WHICH PURPORTS TO SET RATES IN PERPETUITY FOR COUNTRY CLUB AND IS "The Contract" to which Dennis Whitney alludes when he says that he did not make it, but he will enforce it. This provision creates a third party beneficiary in the LAAC since they were not a party to the contract (AUC-LACSD) but they receive a benefit under it. In my opinion this attempt to set rates in perpetuity is illegal and unenforceable and void, since it was at the time, and is now, so disproportionate to market rates that it constitutes a violation of the original Order from the Rail Road Commission in that it violates the public's "convenience and necessity" and moreover is outside of the original order which provided for water to be "taken for re-sale, or domestic use," and the Country Club is not "domestic use". Here are pages 21 and 22 of the 1978 AUC-LACSD contract as they apply to LACC in paragraph 20. " .....20. Rates for Irrigation of Lake Arrowhead Country Club Buyer has been informed and is aware that Seller currently charges the owner of the Lake Arrowhead Country Club an amount (the "Per -21- === Acre Foot Amount") equal to Seventy Five Dollars ($75.00) (the existing Country Club Base Rate") for each and every acre foot of water delivered to the meter located as the Bernina Divide Filter Plant for irrigation of Lake Arrowhead Country Club. Buyer has been informed and is aware that Seller currently charges domestic customers Eighteen Dollars and Fifty Cents ($18.50) (the "Existing Domestic Base Rate") for each of the first one thousand (1,000) cubic feet of water used by such customer during each two (2) month period. Buyer agrees that it will not increase the Per Acre Foot Amount by an amount which would result in the number derived by dividing the Per Acre Foot Amount after such increase by the Existing Country Club Base Rate being greater than the number derived by dividing the then amount to be charged each domestic customer for each of the first one thousand (1,000) cubic feet of water for each of the first one thousand (1,000) cubic feet of water used by such customer during each two (2) month period by the Existing Domestic Base Rate....." -22- ==============================================
A COMPLETE COPY OF THE ORIGINAL RAILROAD COMMISSION ORDER ALLOWING AUC TO TAKE 2000 GALLONS PER MINUTE FOR "DOMESTIC USE" WILL APPEAR BELOW BY 5 PM NOVEMBER 15OCTOBER 4, 2002. I am having problems obtaining a legible copy which can be scanned. **** " DECISION NO. 13767 BEFORE THE RAILROAD COMMISSION....(ETC.)	LACSD BI MONTHLY NEWS LETTER RE DROUGHT ALERTS This bi monthly News Letter dated May/June was still posted on the LACSD's site on October 4, 2002 as being the latest News Letter. At the time of this News Letter requsting conservation, LACSD was piping water to the Country Club in lump transfers that equaled an approximate rate of approximately 400,000 gallons a day (it later rose to 650,000 gallons a day) while advertising weekly in the Mountain News that responsible homeowners should conserve, and publishing below that all landscape watering should be limited to three days a week. As you may recall, it is not disputed that once the Lake is below 5100 feet above sea level (which it has been since July 1, 2001) LACSD can, at its discretion, stop water transfers to the Country Club and must discontinue all other "non domestic" use. ========================= MAY / JUNE 2002 A BI-MONTHLY NEWSLETTER PREPARED BY THE LAKE ARROWHEAD COMMUNITY SERVICES DISTRICT TO PROVIDE ITS CUSTOMERS WITH UP TO DATE INFORMATION REGARDING CUSTOMER SERVICE, BOARD ACTIVITIES AND DISTRICT ACTIONS LAKE LEVEL AND WATER CONSERVATION As we come to the end of our winter weather and precipitation, we note that the present lake level of 5,094.60 feet is down from a full level of 5,106.70 feet, by 12.10 feet, measured on April 16, 2002. Last year on this same date, the lake level was at 5,100.49 feet. We strongly encourage water conservation as an effort to help in reducing the rate at which the lake level will drop this summer. SECOND STAGE OF DROUGHT DUE TO LAKE LEVEL On April 23, 2002, at a Public Hearing, the Board of Directors of the Lake Arrowhead Community Services District (District) adopted Ordinance No. 51 “Declaration of Water Shortage Emergency Condition.” Ordinance No. 51 declared a second stage of drought due to lake level. Declaration of a second stage of drought was necessary because, in accordance with previously adopted Ordinances, the lake reached an elevation of 5,093.6 ft, which serves as a trigger elevation for the second stage of drought. The Second Stage of Drought requires that water conservation measure items (a) through (d) below be adhered to and that landscape irrigation be reduced to three times a week at their normal cycles. The description of Lake Level Drought Stages and the anticipated responses are as follows: (1) Normal Level. Above 5,100 feet. Normal conscientious use as described in conservation measures items (a) through (d) below. (2) First Stage. 5,100 – 5,093.6 feet. The District shall provide on-going notification to the public so that proper measures can be taken to prepare landscapes for more severe drought conditions. (3) Second Stage. 5,093.6 – 5,087 feet. Watering shall be reduced to three times a week at their normal cycles. This is the current Lake Level Drought Stage In Effect . (4) Third Stage. Below 5,087 feet. · There will be no new landscaping constructed until the Lake Level returns to at least the First Stage of Drought. . The watering of all landscapes outside of 30 feet from structures for fire protection shall be prohibited. · For a prolonged Stage 3 condition, all landscape irrigation shall be prohibited. Through the adoption of various Water Conservation Ordinances, including the current Ordinance No. 51, the District has been working to promote the conservation and efficient use of water, and to prevent the waste of this valuable resource. The continuation of economic prosperity in the Lake Arrowhead area is dependent upon adequate supplies of water being available for users. Landscapes can and should be water efficient, while respecting the economic, environmental, aesthetics and lifestyle choices of individuals and property owners. Landscaping is essential to the quality of life in the Lake Arrowhead area as it provides areas for recreation and enhances the environment by cleaning air and water, preventing erosion, offering fire protection and replacing ecosystems lost to development. However, due to past few years of low precipitation and resultant lowering lake level, the District must consider more intensive measures of water conservations. The following conservation measures should be utilized at all times regardless of the applicability of any Lake Level Drought Stage: (a) The use of water for any purpose should not result in flooding, run-off in gutters, driveways, streets or adjacent lands. (b) Sidewalks, walkways, driveways, parking areas, patios, porches, verandas, or any like area should not be washed off with water from hoses or by any other means for dust control or any decorative reason. (c) Water lines, faucets and other facilities should be maintained so they do not leak water. (d) General adherence to water conservation recommendations for residential and commercial customers, as provided by the District to its customers. We ask you, the community, to assist us in Lake Arrowhead’s water conservation efforts. For our conservation measures to be successful, we all must “Use Water Wisely”. The reward of our community’s efforts will be that everyone in the Lake Arrowhead area can continue to enjoy the recreations offered and the beautiful mountain scenery. ***************** COLUMNS CONTINUE BELOW...SCROLL DOWN *****************
The full text of the Interim Report of the Stakeholders' Committee, which was rejected by the LACSD Board on September 24th, was adopted on October 8th, however, with the LACSD Board disputing its contents and with a gentler cover sheet added. The Interim Report is reprinted below. Please take a moment to read it. Stakeholders' Committee THE TEXT OF THE INTERIM REPORT BY THE STAKEHOLDERS' COMMITTEE WHICH INCENSED LACSD IS REPRINTED BELOW: LAKE ARROWHEAD COMMUNITY SERVICES DISTRICT STAKEHOLDERS" ADVISORY GROUP INTERIM REPORT SEPTEMBER 17,2002 Pursuant to the request of the Board of Directors of Lake Arrowhead Community Services District (LACSD), a Stakeholders' Advisory Group (SAGAW), consisting- of representatives of various Arrowhead Woods business, environmental, and other community groups, was created to advise the Board on potential solutions to the low lake level and related funding mechanisms. SAGAAW has met over several weeks and has been presented with information by LACSD's consulting engineers and attorneys. It has additionally considered other proposals and information. SAGAW views the status of the lake level as requiring, immediate action, and accordingly, advises and requests that the Board of Directors immediately commence pursuit of federal and state funding- for facilities as described in the attached draft proposal submitted by Arrowhead Lake Association, with such revisions as may be deemed appropriate by the District and Crestline Lake Arrowhead Water A,, Agency. In summary, SAGAW views the continuation of LACSD's current draw on the lake for water customers as wreaking havoc on the economic viability of the community and laying, waste to the environment. The lake is down nearly 20 feet, more than 1 1/2 times the previous record. LACSD's consulting engineer's study reflects that the lake may not recover. Moreover, usage is increasing not withstanding the District's stated conservation program. Indeed, this year LACSD's draw off the take has increased over the prior year at this time. It is quite clear that urgent action must. be taken WITHOUT DELAY to obtain a supplemental source of water for the community, which must be set as a top priority by the District's Board of Directors, its Officers, and its General Manager. Other potential offsets to water draw off the lake, such as, use of treated effluent for the golf course and wells where financially viable and not drawing lake water, should be pursued simultaneously. Similarly, conservation restrictions, rather than targeted rate increases purportedly related to conservation, need to be implemented. SAGAW believes, however, that the primary resources and efforts of the Board and Senior Management should be focused on the seeking of funding, for and promoting the proposal. FINDINGS SAGAW has evaluated the extensive report prepared by the consulting engineers for the District, and its members have provided input and received comments from the segments of the community that they represent. SAGAW makes the following findings: 1. A critical situation exists at Lake Arrowhead, where the lake level is at a record low and continuing to decline. There is no program in place to arrest this decline, and in fact, despite asserted conservation programs, water use has already increased this year by 13%, and the largest single user is not subject to the recent "conservation" rate increase. LAKE ARROWHEAD COMMUNITY SERVICES DISTRICT STAKEHOLDERS' ADVISORY GROUP 2. While other factors affect the lake level, including substantial evaporation and draw for the country club's irrigation purposes, without draw by LACSD during the past four years, the lake would be nearly full. Evaporation is a factor that essentially cannot be controlled, and the golf course draw is permitted under an agreement. It is likely that .if the nominal charge to the golf course, less than 5% of what is charged residential users for treated water, was increased to a realistic level, meaningful conservation measures would be implemented. While that would be valuable, it might offset, at most 2 inches of lake draw. 3. Over 125 surface acres of water area on Lake Arrowhead have been used by overdraft by the District, resulting in several major bays drying, up and shallowing of many others, with a devastating effect on the appearance and use of the lake. 4. The increase in usage is primarily attributed to three factors: (i) new homes, (ii) conversion of vacation residences to full time occupancies, and (iii) more sprinkled landscaping, 5. There remain approximately 2,300 undeveloped lots in the District's water service area, Arrowhead Woods, leaving, substantial potential for increasing water use. The conversion of vacation properties to full time residences is increasing, and during, the last decade the total of full time residences increased by 1/3. 6. In the event of bioterrorism involving the lake or earthquake or other casualty affecting LACSD's pumping and filtration facilities, there exists no back up supply of water, and there are no contingency plans to provide water to this growing community. 7. There exist questions concerning, whether the current rate of withdrawal of water from the lake by the District exceeds the rate allowed by deeds and regulatory agency decisions. 8. The dramatic increases in population and related usage of water are continuing unabated. 9. The District's planning, for these increases has been limited to funding, and constructing facilities that increase pumping and filtration capacity from the lake, without orientation to obtaining a supplemental water source. 10. The District's water service area is essentially the same as Arrowhead Woods, and the same community's property values benefit from Lake Arrowhead, and suffer the detriments of the declining lake level. II. The District's community obligations as a responsible water agency include preservation and enhancement of its water source, and obtaining supplemental water when endangering the water source.. Endangerment is not limited to merely running out of )Pater, but must take into account the overall effect of emptying bays and shrinking the lake.,surface area on the ecological habitat, the economic environment and the overall community that it servesLAKE ARROWHEAD COMMUNITY SERVICES DISTRICT STAKEHOLDERS ADVISORY GROUP CONCLUSION SAGAW has reviewed the consulting engineer's summary of 12 proposals for obtaining supplemental water and for offsetting water draw by using treated effluent for irrigation and other recycling concepts. SAGAW believes that the proposal of ALA which was included in these alternatives has the most promise for three reasons. It appears that , (i) if pursuit is commenced without further delay, it may be still possible to obtain at least partial funding with federal and state assistance. (i) it provides emergency backup water source for most of the mountain communities and (iii) it provides quality water to these communities. In addition, with cooperation from regulatory agencies, it is a plan of action that could be the basis for regulatory variances necessary for refilling-the lake during the next few years, while the regulatory and other clearances, funding and construction are finalized for the proposal's facilities Accordingly, we advise the Board to immediately focus its resources and undertake good faith and aggressive pursuit of this proposal. SAGAW will further advise the Board once sufficient information is obtained related to implementation of this proposal, including funding, to the extent not covered by federal and state assistance, and alternative proposals should the Board determine after good faith pursuit, that this proposal cannot be implemented. Respectfully submitted: DAN WATERS CHAIRMAN	********** THE LACSD/ALA WATER EXTRACTION RECORDS FOR 2001 VS 2002 L.A.C.S.D. Water Extraction for 2001 vs. 2002 2001 ---------------------------------------------------------------- 2002 Treated Wtr - Raw Wtr/GVL LACC**Treated Wtr - Raw Wtr/GVL LACC Jan: 132 A-F ===== 00.0 A-F === 128 A-F ======= 00.00 A-F Feb: 118 A-F ===== 00.0 A-F === 141 A-F ======= 0.24 A-F Mar 128A-F ===== 00.0 A-F === 121 A-F ======= 00.11 A-F April 121 A-F ===== 00.0 A-F === 160 A-F ======= 00.00 A-F May: 242 A-F =======00.0 A-F== 249 A-F ======= 12.67 A-F June: 321 A-F ===== 13.7 A-F === 363 A-F ======= 47.87 A-F July: 357 A-F ====== 69.52 A-F ===474 A-F =======84.76 A-F August:381 A-F=====64.04 A-F====394 A-F =======59.76 A-F September: 341 A-F==21.50 A-F===397 A-F =======43.01 A-F Oct: A-F =304 A-F===10.89 A-F===299 A-F========12.53 A-F 10 Mo: 2,445 A-F====179.65 A-F===2726 A-F======260.95 A-F ( 1 Acre Foot = 325,851 gallons) In the month of Oct 2002 the overall amount extracted from the lake was 1.6% less than in Oct 2001 although the Country Club extracted 15% more. In Sept 2002 the amount extracted from the Lake was about 16.4% more than in Sept 2001. In the month of Oct the lake level dropped 14 inches. In the month of August 2002, Lake level dropped about 16.7 inches which is the equivalent loss of 5 1/2 feet of shore line at a 15% grade. In the month of Sept it dropped 20 inches or the equivalent of 6 ft 8 inches of shore line at a 15% grade. In the first 10 monts of this year , the amount of water extracted from the Lake has been 11.5% more than the same 10 months of last year. The amount of water used by the Lake Arrowhead Country Club has been 9.6% of the total water used by the community at large in Arrowhead Woods....for which they have paid a 95% discount. Precipitation this year relative to others: Since October 1, 2001, precipitation has been only 11.03 inches, or about 28.24% of normal to date. This is the driest year in 110 years of record keeping at Lake Arrowhead. *****************