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management plan before making commitments to outside service areas. He strongly opposed the Dougherty Valley area being served before Pleasanton. Ms. Mohr asked if the decision was solely that of DSRSD. Mr. Lum indicated DSRSD was not free to leave Zone 7. Under the contract, there would be buy-out tens to pay for abandoning Zone 7 and leaving infrastructure in place. They would also have to qualify as a state water contractor. At this point, DSRSD has indicated it prefers to stay with Zone 7. Mr. Tarvet asked if DSRSD had any fights to the groundwater and would that change if it became a state water contractor? Mr. Lure indicated it has the fight to pump 640 acre feet from the groundwater basin as part of its current contract. That issue is now being reviewed. Mr. Rossman indicated he had not reviewed the question of groundwater fights as yet. He then reviewed the various issues involved for DSRSD to become a state water contractor but he did not believe that was a desirable option for DSRSD. He felt it might be to Pleasanton and Zone 7's advantage to have DSRSD not be part of the district, because it could then be treated differen~y. Ms. Michelotti complimented Randy Lure and Steve Cuzensa for their participation in the Zone 7 Liaison Committee meetings and asking all the fight questions to gather the necessary information. She agreed with the staff recommendation. It was moved by Ms. Michelotti, seconded by Ms. Mohr, to approve sending the attached letter to the Zone 7 Board. Mr. Pico indicated his instinct was that the District should not be expanded by annexing other areas. If water is available for purchase, he preferred that Zone 7 buy it and make sure the supply and quality be guaranteed for those curren~y in the District. The issue of precedence causes concern to him. This is a special district that is only concerned with water. He has concerns with the overall impact of the area, such as air quality, traffic, etc. This is the tip of the iceberg and he felt this will allow massive development here and to the east. The existing Zone 7 customers should receive a positive impact from this agreement. He agreed the model should be vefified and supported the full integration option. The Zone should represent the best interests of existing customers. Ms. Dennis wanted some way to convey the issues and concerns discussed at this meeting to Zone 7. She agreed there could be benefit from the integration option, but she wanted to be sure Zone 7 was aware of all Couneil's concerns. She suggested sending a copy of the minutes of this meeting along with the letter. 06/04/96 -6-