The city of Arroyo Grande will "not pay another penny" toward the Central Coast Blue water project until its demands for a shared operating agreement with Pismo Beach and Grover Beach are met.

That's what Arroyo Grande City Council members unanimously told their city manager on June 8—rejecting a May 24 letter from Pismo and Grover suggesting that the cities hold a public meeting to air out their concerns while they continue to contribute to project costs.

"How much money are we going to have pay theoretically before we know if we're going to get what we asked for?" City Councilmember Kristen Barneich asked. "As a council it was unanimous. We were pretty adamant about what we wanted."

• Image Courtesy Of Pismo Beach
• WATER SOLUTION? Central Coast Blue, a wastewater and groundwater project in South County, continues to hang in the balance.

In April, the Arroyo Grande council made two demands to its partner cities on the $85 million Central Coast Blue groundwater project: equal governance power among the cities and the formation of project management committee subject to the Brown Act.

According to Arroyo Grande council members, Pismo and Grover's offer of more meetings and negotiations over the summer did not address those demands.

"I think we asked for two clear things and we got an ambiguous response," Councilmember Jimmy Paulding said.

Mayor Caren Ray Russom offered the strongest words about the rift, saying, "I haven't heard anything tonight that makes me want to go forward."

"I almost feel like they didn't hear us at all," she said. "It underscored that we don't get input."

The council's 5-0 vote directed city staff not to expend any more money or resources on Central Coast Blue unless Pismo and Grover present a revised operating agreement that meets their demands. Arroyo Grande was being asked to pay $425,000 into the project between June and October to cover permitting and consultant work, according to City Manager Whitney McDonald.

Council members also asked city staff for a presentation at a future meeting outlining the city's other options for water security.

Prior to the blowup, the cities pointed to Central Coast Blue as a key solution to South County's water issues. The project, which has been led by Pismo Beach, would inject treated wastewater into the belowground Santa Maria Valley Groundwater Basin, protecting it against seawater intrusion and drought.

Groundwater currently accounts for 35 percent of Arroyo Grande's water portfolio, with the rest coming predominantly from Lopez Lake.

Pismo Beach Mayor Ed Waage and Grover Beach Mayor Jeff Lee both shared their disappointment with Arroyo Grande's vote in June 9 statements to New Times. Waage indicated that the tri-city partnership is all but finished.

"The city of Pismo Beach is incredibly disappointed in the action of the Arroyo Grande City Council to not move forward with Central Coast Blue," Waage's statement read. "Our request for a public meeting of all three city councils to work through issues in a transparent manner was denied. As partner agencies, we worked in good faith and expended funds to the benefit of our collective communities. Arroyo Grande is refusing to pay their share of the costs. The water security of our region should not be an exercise in political debate. Water is essential to our future and economic vitality, and we are now in a severe drought. Pismo Beach is committed to working with our partner in Grover Beach to find solutions and ensure politics does not come before action. We will continue to pursue a sustainable and drought-resistant water future." Δ