HomeMy WebLinkAbout04-03-19 Board Packet 1
OTAY WATER DISTRICT
AND
OTAY WATER DISTRICT FINANCING AUTHORITY
BOARD OF DIRECTORS MEETING
DISTRICT BOARDROOM
2554 SWEETWATER SPRINGS BOULEVARD
SPRING VALLEY, CALIFORNIA
WEDNESDAY
April 3, 2019
3:30 P.M.
AGENDA
1. ROLL CALL
2. PLEDGE OF ALLEGIANCE
3. APPROVAL OF AGENDA
4. APPROVE THE MINUTES OF THE REGULAR BOARD MEETING OF NOVEM-
BER 7, 2018
5. PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC
TO SPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE
BOARD'S JURISDICTION BUT NOT AN ITEM ON TODAY'S AGENDA
INFORMATIONAL ITEM
6. THE FOLLOWING ITEM IS PROVIDED TO THE BOARD FOR INFORMA-
TIONAL PURPOSES ONLY. NO ACTION IS REQUIRED ON THE FOLLOWING
AGENDA ITEM:
a) PRESENTATION OF 2019 ECONOMIC OUTLOOK UPDATE FOR SAN
DIEGO COUNTY (MR. ALAN NEVIN, XPERA GROUP)
PUBLIC HEARING
7. PUBLIC HEARING ON BOARD OF DIRECTORS PER DIEM RATE
THE BOARD WILL BE HOLDING A PUBLIC HEARING TO HEAR THE PUB-
LIC’S COMMENTS ON THE PROPOSED 5% INCREASE TO THE BOARD OF
DIRECTORS’ PER DIEM RATE FOR ATTENDING MEETINGS AND PER-
FORMING THE DUTIES OF THEIR OFFICE.
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a) ADOPT ORDINANCE NO. 573 TO APPROVE THE PROPOSED 5% IN-
CREASE TO THE BOARD OF DIRECTORS’ PER DIEM RATE FOR AT-
TENDING MEETINGS AND PERFORMING THE DUTIES OF THEIR OF-
FICE; AND, ADOPT RESOLUTION NO. 4361 AMENDING POLICY 8 TO
REFLECT THE NEW PER DIEM RATE AND SECTION C.6.D TO CLAR-
IFY DISTRICT PRACTICE REGARDING DIRECTOR’S RESPONSIBIL-
ITY FOR EXPENSES
CONSENT CALENDAR
8. ITEMS TO BE ACTED UPON WITHOUT DISCUSSION, UNLESS A REQUEST
IS MADE BY A MEMBER OF THE BOARD OR THE PUBLIC TO DISCUSS A
PARTICULAR ITEM:
a) APPROVE CHANGE ORDER NO. 3 TO THE EXISTING CONSTRUC-
TION CONTRACT WITH PACIFIC HYDROTECH CORPORATION IN
THE AMOUNT OF $64,864 FOR THE 870-2 PUMP STATION REPLACE-
MENT PROJECT
b) AWARD A CONTRACT TO LAYFIELD USA FOR THE MAINTENANCE
OF THE FLOATING COVERS ON FOUR (4) POTABLE AND TWO (2)
RECYCLED WATER RESERVOIRS FOR AN AMOUNT NOT-TO-EX-
CEED $169,805 FOR FISCAL YEAR 2020; WITH FOUR (4) ONE-YEAR
OPTIONS FOR RENEWAL AT THE GENERAL MANAGER’S DISCRE-
TION
ACTION ITEMS
9. ENGINEERING AND WATER OPERATIONS
a) ADOPT RESOLUTION NO. 4356 TO APPROVE THE AMENDED AND
RESTATED REGIONAL WASTEWATER DISPOSAL AGREEMENT BE-
TWEEN THE CITY OF SAN DIEGO AND THE PARTICIPATING AGEN-
CIES IN THE METROPOLITAN SEWERAGE SYSTEM. THE UPDATED
AGREEMENT INCORPORATES THE PURE WATER SAN DIEGO PRO-
GRAM, WHICH IS A LONG-RANGE REGIONAL WATER REUSE PLAN
WITH THE GOAL OF REALIZING A SECONDARY EQUIVALENT POINT
LOMA WASTEWATER TREATMENT PLANT AND A NEW LOCAL SUS-
TAINABLE WATER SUPPLY (KENNEDY)
10. BOARD
a) DISCUSSION OF THE 2019 BOARD MEETING CALENDAR
REPORTS
11. GENERAL MANAGER’S REPORT
12. SAN DIEGO COUNTY WATER AUTHORITY UPDATE
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13. DIRECTORS' REPORTS/REQUESTS
14. PRESIDENT’S REPORT/REQUESTS
RECESS TO CLOSED SESSION
15. CLOSED SESSION
a) CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATION
[GOVERNMENT CODE §54956.9]
1 CASE
RETURN TO OPEN SESSION
16. REPORT ON ANY ACTIONS TAKEN IN CLOSED SESSION. THE BOARD
MAY ALSO TAKE ACTION ON ANY ITEMS POSTED IN CLOSED SESSION
OTAY WATER DISTRICT FINANCING AUTHORITY
17. NO MATTERS TO DISCUSS
18. ADJOURNMENT
All items appearing on this agenda, whether or not expressly listed for action, may be
deliberated and may be subject to action by the Board.
The Agenda, and any attachments containing written information, are available at the
District’s website at www.otaywater.gov. Written changes to any items to be considered
at the open meeting, or to any attachments, will be posted on the District’s website.
Copies of the Agenda and all attachments are also available through the District
Secretary by contacting her at (619) 670-2280.
If you have any disability which would require accommodation in order to enable you to
participate in this meeting, please call the District Secretary at (619) 670-2280 at least
24 hours prior to the meeting.
Certification of Posting
I certify that on March 29, 2019, I posted a copy of the foregoing agenda near the
regular meeting place of the Board of Directors of Otay Water District, said time being at
least 72 hours in advance of the regular meeting of the Board of Directors (Government
Code Section §54954.2).
Executed at Spring Valley, California on March 29, 2019.
/s/ Susan Cruz, District Secretary
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MINUTES OF THE
BOARD OF DIRECTORS MEETINGS OF THE
OTAY WATER DISTRICT
AND
OTAY WATER DISTRICT FINANCING AUTHORITY
November 7, 2018
1. The meeting was called to order by President Smith at 3:35 p.m.
2. ROLL CALL
Directors Present: Croucher, Gastelum (arrived at 3:43 p.m.), Robak, Smith and
Thompson
Staff Present: General Manager Mark Watton, General Counsel Dan
Shinoff, Chief of Engineering Rod Posada, Chief Financial
Officer Joe Beachem, Chief of Administration Adolfo Segura,
Chief of Operations Pedro Porras, Asst. Chief of Engineering,
Dan Martin, Asst. Chief of Finance Kevin Koeppen, Asst.
Chief of Operations Jose Martinez, District Secretary Susan
Cruz and others per attached list.
3. PLEDGE OF ALLEGIANCE
4. APPROVAL OF AGENDA
A motion was made by Director Robak, and seconded by Director Croucher and
carried with the following vote:
Ayes: Directors Croucher, Robak, Smith and Thompson
Noes: None
Abstain: None
Absent: Director Gastelum
to approve the agenda.
5. PRESENTATION OF THE CHULA VISTA ELEMENTARY SCHOOL DISTRICT’S
HYDROSTATION AND PARTNERSHIP WITH THE OTAY WATER DISTRICT AND
SWEETWATER AUTtoday, March 22today, March 22HORITY (ASSISTANT
SUPERINTENDENT MATTHEW R. TESSIER, ED.D. AND INNOVATION AND
INSTRUCTION RESOURCE TEACHER MICHAEL BRUDER)
Assistant Superintendent Matthew Tessier presented the Chula Vista Elementary
School District’s Hydrostation program in partnership with the Otay Water District
and Sweetwater Authority. The program’s goal is to expose approximately 4,000
fifth grade students each year to the blue economy or recession proof careers in the
water industry. The Hydrostation will provide students with a full day of hands-on
experience with the various careers available in the water industry and for students
to connect their strengths, interests and values with careers in the water industry.
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Innovation and Instruction Resource Teacher Michael Bruder presented the details
of the program where students participate in six different activities that are relevant
to the water industry careers. This determines which water careers are best suited
to their interests. The students are then provided information about the career that
is best suited to their interest from expected growth in the field to the level of
education required. Mr. Bruder indicated that they are grateful for the Otay Water
District’s support in bringing this program and experience to their students. Mssrs.
Tessier and Bruder responded to questions and comments from the members of the
District’s board.
6. PRESENTATION OF CONTRIBUTION TO THE CHULA VISTA ELEMENTARY
SCHOOL DISTRICT FOR THE HYDROSTATION PARTNERSHIP WITH THE
OTAY WATER DISTRICT
President Smith presented the District’s $10,000 contribution to the Chula Vista
Elementary School District’s Hydrostation Program Project. He stated that the
District is proud to support the program and shared that the program has also
received a $10,000 contribution from Sweetwater Authority and was awarded a
grant from the Hans and Margaret Doe Charitable Trust. He congratulated them on
the work they have accomplished so far and indicated that the District is looking
forward to seeing the metrics on the achievements of the program.
7. APPROVE THE MINUTES OF THE REGULAR BOARD MEETING OF JULY 11,
2018 AND SPECIAL MEETING OF JULY 30, 2018
A motion was made by Director Robak, and seconded by Director Gastelum and
carried with the following vote:
Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson
Noes: None
Abstain: None
Absent: None
to approve the minutes of the regular meeting of July 11, 2018 and special board
meeting of July 30, 2018.
8. PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC TO
SPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE BOARD'S
JURISDICTION BUT NOT AN ITEM ON TODAY'S AGENDA
No one wished to be heard.
CONSENT CALENDAR
9. ITEMS TO BE ACTED UPON WITHOUT DISCUSSION, UNLESS A REQUEST IS
MADE BY A MEMBER OF THE BOARD OR THE PUBLIC TO DISCUSS A
PARTICULAR ITEM:
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A motion was made by Director Croucher, and seconded by Director Thompson and
carried with the following vote:
Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson
Noes: None
Abstain: None
Absent: None
to approve the following consent calendar items:
a) AWARD A CONTRACT TO ERS INDUSTRIAL SERVICES, INC. FOR THE
RALPH W. CHAPMAN WATER RECLAMATION FACILITY FILTER MEDIA
AND NOZZLES REPLACEMENT PROJECT (CIP R2145) IN AN AMOUNT
NOT-TO-EXCEED $115,765.58
b) APPROVE A $25,000 (FROM $150,000 TO $175,000) INCREASE TO THE
CIP R2118 BUDGET AND AWARD A CONSTRUCTION CONTRACT TO
THARSOS, INC. FOR THE RALPH W. CHAPMAN WATER RECLAMATION
FACILITY HEADWORKS IMPROVEMENTS (CIP S2051) AND STEELE
BRIDGE SEWAGE PUMP STATION WET WELL IMPROVEMENTS (CIP
R2118) PROJECT IN AN AMOUNT NOT-TO-EXCEED $223,490
c) APPROVE DECREASING THE CIP P2574 BUDGET IN THE AMOUNT OF
$360,000 (FROM $2,000,000 TO $1,640,000), INCREASING THE CIP
P2625 BUDGET IN THE AMOUNT OF $710,000 (FROM $1,500,000 TO
$2,210,000), AND AWARD A CONSTRUCTION CONTRACT TO CASS
ARRIETA FOR THE VISTA VEREDA (CIP P2574) AND HIDDEN MESA
ROAD (CIP P2625) WATER LINE REPLACEMENT PROJECT IN AN
AMOUNT NOT-TO-EXCEED $2,848,364
d) APPROVE INCREASING THE OVERALL BUDGET FOR CIP S2024,
CAMPO ROAD SEWER REPLACEMENT PROJECT, IN THE AMOUNT OF
$230,000 (FROM $10,300,000 TO $10,530,000) AND APPROVE CHANGE
ORDER NO. 3 TO THE PROJECT’S EXISTING CONSTRUCTION
CONTRACT WITH WIER CONSTRUCTION CORPORATION IN THE
AMOUNT OF $156,192.12
e) APPROVE INCREASING THE CIP P2565 BUDGET IN THE AMOUNT OF
$200,000 (FROM $1,000,000 TO $1,200,000) AND AWARD A
CONSTRUCTION CONTRACT TO ADVANCED INDUSTRIAL SERVICES,
INC. FOR THE 803-2 RESERVOIR INTERIOR/EXTERIOR COATINGS AND
UPGRADES PROJECT IN AN AMOUNT NOT-TO-EXCEED $951,690
f) APPROVE THE PURCHASE OF SEVEN (7) FLEET VEHICLES BY
ISSUING PURCHASE ORDERS TO: ENCINITAS FORD IN THE AMOUNT
OF $102,045.42 FOR THE PURCHASE OF THREE (3) F150 HALF TON
TRUCKS; SUNROAD AUTO, LLC, IN THE AMOUNT OF $145,566.71 FOR
THE PURCHASE OF TWO (2) ONE TON TRUCKS AND ONE (1) F550
CLASS 5 DUMP TRUCK; AND THEODORE ROBBINS FORD IN THE
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AMOUNT OF $39,009.94 FOR THE PURCHASE OF ONE (1) F250 THREE
QUARTER TON TRUCK. THE TOTAL COST FOR SEVEN (7) FLEET
VEHICLES IS $286,622.07
g) APPROVE THE ISSUANCE OF A PURCHASE ORDER TO RDO
EQUIPMENT COMPANY IN THE AMOUNT OF $304,182.30 FOR THE
PURCHASE OF ONE (1) MINI EXCAVATOR AND ONE (1) RUBBER TIRE
LOADER, AND DECLARE UNITS 742, 269, 1503, 3247 AND 3460 AS
SURPLUS
ACTION ITEMS
10. ADMINISTRATION AND FINANCE
a) APPROVE THE AUDITED FINANCIAL STATEMENTS, INCLUDING THE
INDEPENDENT AUDITORS’ UNQUALIFIED OPINION, FOR THE FISCAL
YEAR ENDED JUNE 30, 2018
Senior Accountant Marissa Dychitan presented the District’s audited financial
statements, including the independent auditors’ unqualified opinion, for the fiscal
year ended June 30, 2018. Please reference the Committee Action notes
(Attachment A) attached to the staff report for the details of Ms. Dichitan’s and Mr.
Rich Teaman’s, Teaman Ramirez and and Smith, reports.
Staff indicated in response to an inquiry from Director Smith that the District’s Other
Post Employee Benefits (OPEB) is approximately 86 to 87% funded and it is
expected to be fully funded in 2021. It was further indicated that because these
funds are invested for a long time period, they can be invested in different
investments than the District’s operating revenues. The projected rate of return on
the OPEB fund is 7%, similar to CalPERS projection.
A motion was made by Director Thompson, and seconded by Director Robak and
carried with the following vote:
Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson
Noes: None
Abstain: None
Absent: None
to approve staff’s recommendation.
b) CONSIDERATION OF PROPOSAL FOR AUDIT SERVICES FOR FISCAL
YEAR 2019
Finance Manager Eid Fakhouri indicated that this item is presented to select the
District’s auditing firm for the FY 2019 audit. He stated that the District’s Finance
and Administration Committee had discussed two proposals they wished the full
board to consider. Please reference the Committee Action notes (Attachment A)
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attached to the staff report for the details of the proposals and Mr. Fakhouri’s
presentation.
It was discussed that Teaman Ramirez and Smith, LLP’s (TRS) five-year contract is
ending. It was indicated that their firm had also provided auditing services to the
District 10-years ago and that another auditing firm had provided the services
between TRS’s engagement dates. Director Thompson indicated that the proposal
to extend the TRS contract was driven by the language in the staff report that was
presented to the Finance and Administration Committee regarding the GFOA
procurement best practices for audit procurement which indicates that “Government
entities should enter into multi-year agreements of at least five years in duration
when obtaining the services of independent auditors as it allows for continuity”. The
District’s practice has been to change its auditors every five years. However, there
is no policy that requires the District to change its auditors every five year. He
stated for efficiency and continuity purposes, also due to the fact the District will be
managing the possible disposition of the Salt Creek Golf Couse, he felt that it would
make sense to extend the auditing contract another year for continuity. Additionally,
he indicated that TRS is a good firm and their fee is very competitive.
It was discussed if the TRS contract was extended for one year, with an option for
one additional year for a total of two years, the District would request that the
partner in charge be rotated to another partner of the firm to provide for a fresh
perspective on the District’s audit. Mr. Joshua Calhoun will serve as the partner in
charge of the District’s FY 2019 audit. He has been with TRS for ten years and he
would be working with a different Manager in-Charge of the audit who has 18 years
of experience and a new audit team from TRS. The new team has not worked on
the District’s audit.
Director Thompson indicated that he wished to note that he has not had any
conversations with the staff of TRS and his recommendation to extend the TRS
contract was made after he reviewed the staff report. He stated staff’s report was
the only reason he made the suggestion.
It was discussed that CWA rotates auditing services every three to five years.
Director Croucher suggested that the Audit Committee/Finance and Administration
Committee meet with TRS prior or during the audit to discuss any areas of particular
interests they wished reviewed as part of the audit.
A motion was made by President Smith, and seconded by Director Thompson and
carried with the following vote:
Ayes: Directors Croucher, Robak, Smith and Thompson
Noes: Director Gastelum
Abstain: None
Absent: None
to extend TRS’ contract for one year with an option for an additional year for a total
of two years and that a new partner from TRS be assigned to oversee the District’s
audit.
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c) ADOPT RESOLUTION NO. 4353 TO APPROVE THE 2019–2024
MEMORANDUM OF UNDERSTANDING (MOU) BETWEEN THE OTAY
WATER DISTRICT AND THE OTAY WATER DISTRICT EMPLOYEES’
ASSOCIATION (OWDEA) AND RELATED ACTIONS
Human Resources Manager Kelli Williamson requested that the board consider
adopting Resolution No. 4353 to approve the Memorandum of Understanding
(MOU) between the Otay Water District and the Otay Water District Employees’
Association (OWDEA) effective July 1, 2019 through June 30, 2024 (with some
provisions going into effect immediately upon Board approval), for the Field and
Administrative Employees’ Bargaining Units and approve extending the same cost-
pf-living adjustments and related benefits for management, confidential, and
executive employees. She reviewed the changes proposed to the MOU as listed in
staff’s report (attached) which also includes updates in the law. She noted that the
OWDEA met on October 24, 208 to conduct a ratification meeting for represented
employees. The Association ratified the tentative agreement with 83% of the
members voting and of those that voted, 87% recommending acceptance of the
agreement.
Director Thompson thanked the Board of Directors Ad Hoc Employee Negotiations
Committee for the good work they did in representing the members of the board.
He commended the committee for keeping costs at a reasonable level and for
keeping a positive relationship with employees whose work they appreciate. He
stated that members of the board are also able to indicate to the District’s
ratepayers that they have done their job. Director Robak added that he has been
on both sides of these type of negotiations and the desire is to be able to
compensate staff for what their skills are worth and to also have productivity and
efficiency. He stated there is a nexus between paying for employee benefits and
achieving productivity and efficiency and he felt that they have achieved a balance
between the two.
Database Administrator Bill Poulin, a member of the OWDEA, thanked the board for
extending the opportunity for employees to continue to do what they are doing. He
stated that he joined Otay WD because he noted in an employee position
advertisement that the District utilized newer technology, Sequel Server Reporting
Services. He stated that public agencies did not utilize such technology and it
caught his attention. He stated that other agencies respect the work the District is
doing and it is a good feeling.
A motion was made by Director Robak, and seconded by Director Gastelum and
carried with the following vote:
Ayes: Directors Croucher, Robak, Smith and Thompson
Noes: Director Gastelum
Abstain: None
Absent: None
to approve staff’s recommendation.
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Director Gastelum indicated that he expressed in an Op Ed, which was not printed
by the publisher, that the Otay Water District was a top notch organization. He
stated that it is a team effort and the District has excellent employees. He shared
that he voted no because there were some things negotiated that he liked and there
were things he did not like. His stated his vote is not an absolute no, but his
conscience said to vote no. He wanted employees to know that be brags about
Otay WD and the wonderful work that the employees accomplish and he is
appreciative of their efforts.
11. BOARD
a) DISCUSSION OF 2018 - 2019 BOARD MEETING CALENDAR
President Smith noted that the December 5, 2018 board meeting has been
canceled. District Secretary Susan Cruz noted that staff will be utilizing the first
week in December to schedule committee meetings.
INFORMATIONAL ITEMS
12. THIS ITEM IS PROVIDED TO THE BOARD FOR INFORMATIONAL PURPOSES
ONLY. NO ACTION IS REQUIRED ON THE FOLLOWING AGENDA ITEM.
a) UPDATE ON RECENT CONSTRUCTION BIDS THE DISTRICT HAS
RECEIVED, GRANT FUNDING AVAILABLE ON DISTRICT PROJECTS,
AND UTILIZATION OF AS-NEEDED CONSTRUCTION MANAGEMENT
SERVICES
Assistant Chief of Engineering Dan Martin indicated that his presentation will cover
three areas: 1) impact of Federal tariffs to construction market cost trends that have
impacted recent construction bids, 2) Funding opportunities to support the District’s
projects; and 3) Utilization of as-needed construction management services.
Please reference the Committee Action notes (Attachment A) attached to the staff
report for the details of Mr. Martin’s report.
There was discussion that because of the escalating cost of construction materials,
staff estimates that the construction budget will increase between 15% and 20%. It
was noted that there will be some variability in the engineer’s estimate versus the
bids because of fluctuating material costs.
Director Croucher left the dias at 5:14 p.m. and returned at 5:18 p.m.
Staff manages the Construction Manager (CM) on project specific task orders under
an awarded “as needed” construction management contract. Under the contract for
FYs 2019 and 2020, the combined average hourly loaded rate for as-needed CM
services is estimated to be $154.50 per hour. CM work handled internally cost $138
per hour fully loaded as the District’s cost does not include profit (the District is
revenue neutral). It is estimated that the level of effort under the as-needed CM and
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inspection contracts for FY 2019 and FY 2020 will be .60 FTE and .93 FTE
respectively.
REPORTS
13. GENERAL MANAGER’S REPORT
General Manager Watton reviewed handouts that were provided on the dias for
each member of the board (see attached). He also presented information from his
report which included an update on drone software and image collection, the
employee holiday dinner, the San Diego Contracting Opportunities Center workshop
on doing business with Otay WD, the Fire Marshal’s annual inspection, the Campo
Road Sewer Replacement, Mexico’s request for water deliveries, CalOSHA’s
citation dismissal, water sales and purchases.
14. SAN DIEGO COUNTY WATER AUTHORITY UPDATE
Director Croucher shared that ACWA’s September 21, 2018 Newsletter announced
President Smith as one of three new directors seated at MWD. He indicated that
ACWA’s October 2018 Newsletter published photos of CWA’s new officers which
included Director Croucher. He also reported that Chair Jim Madaffer had sent a
letter to MWD concerning the legal settlement and the relationship between the two
agencies. The letter received positive feedback from the board members of both
agencies. Chair Madaffer also spoke to MWD’s Legal Claims Committee offering
an “olive branch” towards trying to solve the decade long legal battles between the
two agencies through compromise. His speech set the tone towards his goal that
he wishes to accomplish during his tenure which would allow the two agencies to
work towards regional solutions that benefit all water users in Southern California.
CWA was also successful in working with other MWD member agencies in
supporting MWD representative Gloria Gray and her election as Chair of MWD’s
board of directors. Director Croucher indicated that he gives a lot of credit to new
CWA Chairman Madaffer for his leadership in the progress towards change in the
relations with MWD.
President Smith added with regard to CWA’s CalPERS funding level that they had
followed Otay WD’s lead and now CWA’s CalPERS benefit is 72% funded. CWA
plans to contribute $1 million annually to the benefit with a goal of having it 75% to
85% funded within 20 years which will save CWA $35 million. He also indicated
several years ago he had presented a graph comparing the District’s revenue
budget with actual revenues and the variance between the budget and actual
revenues. He stated that he introduced the comparative graph to CWA and after
several months, they added the graph to their dashboard. He noted that MWD
already utilizes the graph and it is reported within their general manager’s report.
He lastly reported on a disinfection station that was approved by CWA’s board
which will disinfect pipeline in Mission Trails.
15. DIRECTORS' REPORTS/REQUESTS
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Director Gastelum reported that he attended a tour of MWD’s FE Weymouth
Treatment Plant on October 4, 2018. He stated that he also attended JamulFest
and the Casa de Oro Fall Festival. He lastly shared that he attended ACWA’s
Region 10 Program discussing, “Removing Barriers to Innovation in Water” on
October 18, 2018.
Director Robak reported that he attended the City of Chula Vista’s First Friday
breakfast on November 2, 2018. He noted that Mr. Steve Casteneda was reelected
to Sweetwater Authority’s board, Mr. Hector Martinez was newly elected to their
board and Mr. Dan McMillan was reelected to the Helix Water District board. He
also shared that Mr. Mark Muir was not reelected to the City of Encinitas’ Council.
16. PRESIDENT’S REPORT
President Smith’s report is attached. He noted that Helix WD will be hosting a
meeting with the water agencies’ Board Presidents and General Managers that are
located in the southern portion of the County of San Diego to share information
between the agencies and discuss things that we can improve upon.
17. CLOSED SESSION
The board recessed to closed session at 5:50 p.m. to discuss the following matter:
a) PUBLIC EMPLOYEE PERFORMANCE EVALUATION: PERIODIC AND
CUSTOMARY REVIEW IN DUE COURSE [GOVERNMENT CODE
§54957.6]
TITLE: GENERAL COUNSEL
The board reconvened at 6:27 p.m. and Attorney Jeanne Blumenfeld indicated that
the board took no reportable actions in closed session.
18. ADJOURNMENT
With no further business to come before the Board, President Smith adjourned the
meeting at 6:28 p.m.
___________________________________
President
ATTEST:
District Secretary
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President’s Report
Tim Smith
November 7, 2018
Board Meeting
# Date Meeting Purpose
1 2-Oct Ad Hoc Employee Negotiations
Committee Discussed employee negotiations matters.
2 3-Oct OWD Regular Board Meeting Monthly Board Meeting
3 12-Oct Committee Agenda Briefing
Met w/ General Manager Watton to
review items that will be presented at the
October committee meetings.
4 16-Oct EO&WR Committee Reviewed items that will be presented at
the November board meeting.
5 24-Oct East County Caucus Discuss CWA issues
6 26-Oct Sign Bond Documents at OWD Execute documents for the issuance of
water bonds.
7 30-Oct Colorado River Briefing Discuss issues related to the Colorado
River.
STAFF REPORT
TYPE MEETING: Board Meeting MEETING DATE: April 3, 2019
SUBMITTED BY: Kevin Koeppen, Assistant Chief
of Finance
PROJECT: DIV. NO. All
APPROVED BY:
(Chief)
Joseph R. Beachem, Chief Financial Officer
Mark Watton, General Manager
SUBJECT: Informational Report Presenting the 2019 Economic Outlook
Update for San Diego County prepared by the Xpera Group
GENERAL MANAGER’S RECOMMENDATION:
Informational Report presenting the 2019 Economic Outlook Update
for San Diego County prepared by the Xpera Group.
PURPOSE:
To present to the Board the 2019 Economic Outlook Update for San
Diego County prepared by Alan Nevin of the Xpera Group.
DISCUSSION:
Each year the District goes through a budget process with new
challenges. The budget process starts in January and culminates
with a budget workshop with the Board in May. In prior years,
staff has held a single budget workshop in May. During that
workshop, staff presents several items pertaining to the budget
to the Board. For FY20, staff is changing the budget process by
splitting up the budget workshops into three presentations.
The Economic Outlook presentation is the first of the three
presentations to the Board pertaining to the FY20 budget. The
next presentation will be a Board workshop held on May 2nd to
review key assumptions and inputs used to prepare the budget,
along with known opportunities and challenges. At the June 5th
Board meeting, staff will make the final presentation of the
consolidated FY20 budget and request Board approval of the
following items: the FY20 Operating and CIP Budget, Interfund
Transfers, and actions associated with recommended rate changes.
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To prepare the budget, staff makes every effort to present the
most realistic set of factors and assumptions based on
information received from various sources, including growth and
economic expectations. Part of this process includes engaging
an Economist to perform an Economic Outlook study evaluating the
projected health of both the global and local economies. The
study includes discussions about macro and micro economic
activities, including a six-year projection of development
within the District. Staff incorporates the information
provided in this report in preparing the budget including
estimated growth related revenues and costs, and inflation
factors.
The below table summarizes the dwelling unit growth projections
that will be used to prepare the upcoming budget and 6-year rate
model.
Growth Projections (Units)
When compared to the prior year projections for FY20 to FY24,
Equivalent Dwelling Units (EDUs) are projected to decline 37%,
which will result in a $7 million reduction in capacity fee
revenues, and a $700 thousand reduction in new water supply fees
for the same time period. The following table provides a
historical comparison of EDU’s.
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FISCAL IMPACT: Joseph R. Beachem, Chief Financial Officer
Holding all other assumptions constant, the $7.7 million
reduction in capacity and new water supply fee projections over
the five-year period from FY20 to FY24 will adversely impact
rates. Based on the current budget practice, the recovery of
the revenue impact would occur over several years and be re-
evaluated as part of the annual budget process.
A one-time rate increase of 1.4% would recoup the lost revenue
over a 6-year period.
STRATEGIC OUTLOOK:
The District ensures its continued financial health through
long-term financial planning and debt planning.
LEGAL IMPACT:
None.
Attachments:
A) The Xpera Group Presentation
B) The Xpera Group Economic Report
Economic Outlook Study
Otay Water District
FY 2019-2025
Alan Nevin
Director, Economic Research
Xpera Group
April 3, 2019
Attachment A
Global Growth on a Positive Course
India & the U.S. Lead the Way
Country 2020 2040 Change (Millions) % Change
India 1,324,000 1,656,000 332,000 25%
United States 325,700 379,200 53,500 16%
European Union 511,800 528,350 16,550 3%
South Korea 51,245 43,329 (7,916) -15%
Russia 144,342 129,908 (14,434) -10%
Japan 127,141 107,210 (19,931) -16%
China 1,379,000 1,304,000 (75,000) -5%
Total 3,863,228 4,147,997 284,769 7%
Source: United Nations Population Division
Population (Millions)
Major Countries
1990-2040 (Projected)
2020-2040
Youth will Drive the Global Economies
Country 2040
India 28%
United States 23%
China 21%
South Korea 20%
Japan 18%
European Union 11%
Russia 6%
Source: United Nations Population Division
% of Population Under Age 19
Major Countries
2040 (Projected)
NAFTA Continues to Move Forward
Country Trillions % Change
United States 34.01$ 65%
Mexico 5.66$ 36%
Canada 3.10$ 88%
Total 42.77$ 62%
Source: World Bank (1990-2020); PWC (2050)
Gross Domestic Product (Trillion)
NAFTA Countries
2050 (Projected)
Mexico to Lead NAFTA % Gains
on a Per Capita Basis
Country 2040 Change % Change
United States 75,700$ 13,183$ 21%
Mexico 32,400$ 22,530$ 228%
Canada 60,700$ 12,100$ 25%
Source: World Bank; PWC
Gross Domestic Product Per Capita
NAFTA Countries
2040 (Projected)
2020-2040
Declining Birth Rate Drives
Mexico’s Economic Gains
Country 1990 2020 2040
United States 2.03 1.88 1.91
Mexico 3.75 2.14 2.08
Canada 1.69 1.61 1.60
Total 7.47 5.63 5.59
Source: United Nations Population Division
Fertility (Children Per Woman)
NAFTA Countries
1990-2040 (Projected)
The United States
The Nation’s GDP Continues to Grow
U.S. Inflation Remains Low
Millennials Continue to Drive
the U.S. Economy
U.S. Continues to Add 2.0+ Jobs Annually
Year Total
Annual
Change
Monthly
Change
2010 130,354 (952) (79)
2011 131,939 1,585 132
2012 134,174 2,235 186
2013 136,374 2,200 183
2014 138,941 2,567 214
2015 141,826 2,885 240
2016 144,348 2,522 210
2017 146,611 2,263 189
2018 149,064 2,453 204
Source: Bureau of Labor Statistics
Total Employment
United States
2010-2018
KK1
Slide 12
KK1 Kevin Koeppen, 3/25/2019
U.S. Unemployment Rate Remains Very Low
California
California is the World’s 6th Largest Economy
Placement Nation $ Billions
1 United States 21,482,410$
2 China 14,172,200$
3 Japan 5,220,570$
4 Germany 4,117,070$
5 India 2,957,720$
6 California 2,940,000$
7 France 2,844,700$
Source: usgovernment spending.com
California's World Ranking
2019 Gross Domestic Product
Employment in California Continues to Expand
Year Employment Change
2014 15,577,383 n/a
2015 16,051,417 474,033
2016 16,478,517 427,100
2017 16,818,692 340,175
2018 17,147,917 329,225
Source: Ca EDD
Payroll Employment
California
2015-2018
California tops the Charts for R&D
No. State
R&D Per 100,000
People
1 California 1,175,690$
2 Massachusetts 215,600$
3 Washington 196,730$
4 Michigan 188,470$
5 Texas 173,530$
6 New Jersey 157,150$
7 New York 157,140$
8 Illinois 137,330$
9 Pennsylvania 123,000$
10 North Carolina 100,640$
Source; National Science Foundation
Research & Development Spending
The Ten Most Innovative States
3rd Year in a Row: More than 100,000 Units
Non‐Residential Up for 7th Straight Years
San Diego
SD Continues to Add 25,000+ Population Annually
Year No.
2017 3,320,108
2035 3,853,698
Change 2017-2035 533,590
Annual Change 29,644
% Change 16.1%
Source: SANDAG
Population Projections
San Diego County
2017-2035
SD Employment Continues UPward
And SD Unemployment Continues to Decline
SD’s Economic Drivers
Category No. Jobs
Professional & Business Services 254,200
Leisure & Hospitality 193,900
Manufacturing 115,400
Dept. of Defense (Uniformed) 95,000
Colleges & Universities 49,200
Federal Government (non-defense) 24,800
Information 24,300
Dept. of Defense (Civilian) 22,000
State Department 17,200
Total 796,000
Economic Drivers
San Diego County
2019
Sd Tops 10,000 Units in Past 3 Years
Year Total
Single
Family
Multi-
Family % MF
2012 5,687 2,198 3,489 61.4%
2013 8,264 2,565 5,699 69.0%
2014 6,871 2,478 4,393 63.9%
2015 9,893 3,253 6,640 67.1%
2016 10,666 2,341 8,325 78.1%
2017 10,415 4,058 6,357 61.0%
2018 10,500 3,500 7,000 66.7%
Average 8,899 2,913 5,986 66.7%
2012-2014 6,941 2,414 4,527 64.7%
2015-2018 10,369 3,288 7,081 68.2%
Source: Census Bureau Construction Permit Survey
Residential Units Permitted
San Diego County
2012-2018
Southern San Diego County
Residential Development Projections
OWD Service Area
Fiscal Years:20
1
8
-
2
0
1
9
20
1
9
-
2
0
2
0
20
2
0
-
-
2
0
2
1
20
2
1
-
2
0
2
2
20
2
2
-
2
0
2
3
20
2
3
-
2
0
2
4
20
2
4
-
2
0
2
5
To
t
a
l
Av
e
r
a
g
e
Single Family 700 600 500 400 400 300 300 3,200 457
Multi-Family For "Sale 1,300 1,200 1,000 800 600 500 400 5,800 829
Multi-Family Rental 300 400 300 300 300 300 300 2,200 314
Total Multi-Famiily 1,600 1,600 1,300 1,100 900 800 700 8,000 1,143
Total 2,300 2,200 1,800 1,500 1,300 1,100 1,000 11,200 1,600
% Multi-Family 70% 73% 72% 73% 69% 73% 70% 71% 71%
Residential Development Projectons
Otay Water District Service Area
Fiscal Years 2018-2025
Non‐Residential Development Projections
OWD Service Area
2018‐2025
Fiscal Years: Measure 20
1
8
-
2
0
1
9
20
1
9
-
2
0
2
0
20
2
0
-
-
2
0
2
1
20
2
1
-
2
0
2
2
20
2
2
-
2
0
2
3
20
2
3
-
2
0
2
4
20
2
4
-
2
0
2
5
Total
Hotels (2)Rooms 478 150 100 100 828
Industrial (1)Sq.Ft. 300,000 300,000 300,000 300,000 300,000 300,000 300,000 2,100,000
Retail Sq.Ft. 165,000 20,272 15,000 20,000 20,000 20,000 20,000 280,272
Office Sq.Ft. - - 10,000 10,000 10,000 150,000 150,000 330,000
(1) excludes renovation of Sanyo space.
(2) excludes the 1,600 room RIDA Hotel and Conference Center which is not in the OWD service area.
Non-Residential Development Projectons
Otay Water District Service Area
Fiscal Years 2018-2025
Overall, things are going well in South County
10911 Technology Place
San Diego CA 92127
858-436-7770
Economic Outlook Update
Otay Water District
San Diego County
Prepared for
Otay Water District
February 2019
Page 2 of 91
March 22, 2019
Mr. Mark Watton
General Manager
Otay Water District
2554 Sweetwater Springs Blvd.
San Diego CA 91978
RE: Economic Outlook Update, Otay Water District
Dear Mr. Watton:
Xpera Group has been retained to prepare an economic outlook update
for the Otay Water District.
The outlook includes an economic and demographic analysis of the
national and local economy and then focuses on the changes in
population, residential and commercial development within the Otay
Water District service area.
We stand ready to respond to your inquiries about the study and its
findings.
Sincerely yours,
Alan N. Nevin
Director, Economic Research
Xpera Group
Page 3 of 91
Introduction: Economic Outlook Update
Otay Water District Service Area
Xpera Group has undertaken and now completed an update of the Economic
Outlook Study for both San Diego County and the area served by the Otay Water
District (“OWD”).
In this report, we concentrate on the changing demographics in the world, the
nation, California and San Diego County and the projected residential and
commercial development within the County and the OWD service area.
The OWD services most of Chula Vista east of I-805 and the Otay Mesa area. The
service area covers 125 square miles and services more than 50,000 customers.
Page 4 of 91
In last year’s report, we noted evidence of strong future development in the OWD
service area. We have now updated this information to 2019 in order to project
outward to fiscal year 2024/2025.
This report is segmented into eight sections:
Section 1: International Outlook
Section 2: The National Economy
Section 3: The California Economy
Section 4: The San Diego County Economy
Section 5: San Diego County Housing Market
Section 6: Future of South County
Section 7: Future Residential Development – OWD Jurisdiction
Section 8: Projections for OWD Development Activity 2019-2025
Although the results, conclusions and recommendations contained within this
consultant’s report are based upon a thorough review and analysis of current
competitive market conditions and the expertise of the author, Consultant does not
in any way represent, warrant or guarantee that any reported results will be
achieved as a result of various reasons, including but not limited to the sensitivity to
ever-fluctuating market conditions and the efficiency of a Client and its
representatives, agent, employees, successors and assigns.
Page 5 of 91
Table of Contents
Section
Page
Section 1: International Outlook 5
Section 2: The National Economy 16
Section 3: The California Economy 31
Section 4: The San Diego County Economy 39
Section 5: San Diego County Housing Market 50
Section 6: Future of South County 56
Section 7: Future Residential Development – OWD Jurisdiction 65
Section 8: Projections for OWD Development Activity 2019-2025 79
Appendix
Page 6 of 91
Section 1: International Outlook
In the past year, far more attention has been paid to international economic issues
than in almost any year in the recent past. For that reason, I thought I would take
the opportunity to look at the demographics and economies at the major countries
in the world and track their recent and future trends, as their future is also our
future.
As the industrialized countries grow, so do our opportunities for doing business
abroad, with the West Coast of our Nation in a particularly strong position to benefit
from international growth.
The purchasing power of the world drives the U.S. economy. In the next 20
years, the emerging countries will power the world economy.
Currently, I am working on the second edition of my book “The Great Divide.” The
book looks out 25 years on the future of the world and the United States and, of
course, California. The second edition delves far more into the world scene and
what I am including in this report is a few statistics that provide an outlook into
tomorrow around the world.
1.1
As we look around the world, perhaps the most stunning fact is that in the 1990-
2020 period, China will have gained almost a quarter billion people, but in the next
20 years, they will actually lose population as a result of their now abandoned one-
child policy. India will have a slower rate of growth than in the past 20 years, but will
still add one-third of a billion people in that timeframe.
Page 7 of 91
The long-term slowdown of the China economy is a direct result of the one-child
policy and its effect on minimalizing household formations. The household
formations drive the market for consumer goods and new housing.
Also note that in the 1990-2020 period, South Korea, Japan and Russia barely
added to their population and in the next 20 years will face a declining population
and a declining demand for goods.
1.2
GDP As The World Turns
The gross national product of India and China have exploded in the past 20 years,
and depending on your source, will experience even more growth in the next 20
years.
As the world turns,
Country 1990 2020 2040 Change % Change Change % Change
India 870,000 1,324,000 1,656,000 454,000 52%332,000 25%
China 1,135,000 1,379,000 1,304,000 244,000 21%(75,000) -5%
European Union 439,300 511,800 528,350 72,500 17%16,550 3%
United States 282,162 325,700 379,200 43,538 15%53,500 16%
South Korea 42,869 51,245 43,329 8,376 20%(7,916) -15%
Japan 123,116 127,141 107,210 4,025 3%(19,931) -16%
Russia 148,282 144,342 129,908 (3,940) -3%(14,434) -10%
Total 3,040,729 3,863,228 4,147,997 822,499 27%284,769 7%
Source: United Nations Population Division
1990-2020 2020-2040
Population (Millions)
Major Countries
1990-2040 (Projected)
Page 8 of 91
1.3
Along with their population growth, there have been some remarkable changes in
gross domestic product (GDP) per capita. The two major changes were in China
which moved from an average of $330 per capita in 1990 to $10,100 in 2020.
In the next 20 years, the clear winner among major countries will be India which will
increase its GDP per capita by seven times. Reflecting its slowdown in population
gain, China is anticipated to have a 20-year change in GDP per capita of 210%.
1.4
Country 2000 2020 2040 Change % Change Change % Change
India 292$ 2,597$ 28,021$ 2,305$ 789%25,424 979%
United States 9,764$ 19,390$ 34,102$ 9,626$ 99%14,712 76%
European Union 8,906$ 16,538$ 21,567$ 7,632$ 86%5,029 30%
China 1,198$ 12,237$ 49,853$ 11,039$ 921%37,616 307%
Russia 259$ 1,577$ 5,127$ 1,318$ 509%3,550 225%
South Korea 511$ 1,530$ 3,539$ 1,019$ 199%2,009 131%
Japan 4,649$ 4,872$ 6,779$ 223$ 5%1,907 39%
Source: PWC, GDP at Market Exchange Rates, February 2015; international monetary fund
Gross Domestic Product (Trillions)
Major Countries
2000-2040 (Projected)
2000-2020 2020-2040
Country 2000 (1)2020 (2)2040 (3) Change % Change Change % Change
China 959$ 10,971$ 34,000$ 10,012 1044%23,029 210%
Russia 1,771$ 11,710$ 44,800$ 9,939 561%33,090 283%
South Korea 11,947$ 34,209$ 58,600$ 22,262 186%24,391 71%
India 438$ 2,379$ 18,300$ 1,941 443%15,921 669%
United States 36,449$ 67,082$ 75,700$ 30,633 84%8,618 13%
European Union 19,740$ 36,593$ 40,848$ 16,853 85%4,255 12%
Japan 38,532$ 42,748$ 58,200$ 4,216 11%15,452 36%
Source: (1)World Bank; (2) International Monetary Fund; (3)European Commission (Global Europe 2050)
Gross Domestic Product Per Capita
Major Countries
2000-2040 (Projected)
2000-2020 2020-2040
Page 9 of 91
Driving many of these changes is the fertility rate (number of births per woman).
India, from 1990 to 2040 will almost half its fertility rate. And that drives the GDP per
capita.
It is also important to note that the economic growth of industrialized countries is
closely tied to the fertility rate, to this extent: When the fertility rate falls below 2.00,
the number of household formations, through time, falters and ultimately causes the
economies of countries to decline.
1.5
Concomitantly, the number of persons in the K-12 grade range is a strong sign of
the future work force. It is important for the population 0-19 to be more than 20% of
the population as it now is in the following exhibit shown below, but by 2040, the
European Union and Russia will fall substantially below that level, as the over 65
population multiplies.
Country 1990 2020 2040
India 3.81 2.30 2.00
United States 3.03 1.89 1.91
European Union 1.56 1.60 1.80
China 1.90 1.64 1.74
Russia 1.55 1.75 1.85
South Korea 1.69 1.32 1.60
Japan 1.49 1.48 1.68
Fertility (Children Per Woman)
Major Countries
1990-2040 (Projected)
Page 10 of 91
1.6
1.7
Country 1990 2020 2040
India 47%36%28%
United States 29%25%23%
Russia 30%23%6%
China 26%21%21%
European Union 38%20%11%
South Korea 30%18%20%
Japan 27%17%18%
Source: United Nations Population Division
% of Population Under Age 19
Major Countries
1990-2040 (Projected)
Country 1990 2020 2040
India 3.8 6.0 11.0
United States 12.6 14.9 22.0
Russia 10.3 13.6 20.0
China 5.7 10.1 24.0
European Union 12.7 19.4 26.0
South Korea 5.2 13.0 31.0
Japan 11.9 26.6 34.0
Source: United Nations Population Division
% of Population over Age 65
Major Countries
1990-2040 (Projected)
Page 11 of 91
In summary, the industrialized world is growing, but growing slowly, except for India
which will overtake China in population in the next 20 years. India will also see a
major increase in per capita income in tandem with the decline in fertility rate.
The United States continues to be on a stable population and economic growth path
as are its two neighbors: Mexico and Canada.
The Nafta Countries
Canada and Mexico are the Nation’s No. 2 and 3 trading partners, with China in first
place. We import more than export with Mexico and in 2018 are just about on par
with Canada.
1.8
The NAFTA countries (Mexico, Canada and the U.S.) combined have a gross
domestic production (GDP) that is greater than that of the European Union (27
countries), Russia, South Korea and Japan combined.
The GDP of the Nafta countries is projected to expand to $43 trillion by 2050.
Year Imports Exports (1)Difference Imports Exports Difference
2008 215,941$ 151,220$ (64,721)$ 339,491$ 261,149$ 78,342$
2018 362,166$ 278,225$ (83,941)$ 336,496$ 314,511$ 21,985$
Change 146,225$ 127,005$ (2,995)$ 53,362$ (56,357)$
% Change 67.7%84.0%-0.9%20.4%
(1) Based on trade through October 2018
Source: Census.gov
Mexico Canada
Trade with Mexico and Canada (Millions)
NAFTA Countries
2008-2018
Page 12 of 91
1.9
Of equal importance is the GDP per capita. Our neighbor to the south is projected
to dramatically increase its GDP per capita over the next 20 years, rising to $32,400
per capita by 2040 from $9,870 in 2020. Pointedly, in the next 20 years, the
Mexican GDP per capita is projected to triple.
1.10
A major component of the increase of GDP per capita is the fertility rate which is
projected to decline by almost half between 1990 and 2040. Canada and the U.S.
are projected to have a modestly declining fertility rate in that same time period.
Country 1990 2020 2050 Change % Change Change % Change
United States 5.98$ 20.66$ 34.01$ 14.7$ 245%13.4$ 65%
Mexico 2.60$ 4.15$ 5.66$ 1.6$ 60%1.5$ 36%
Canada 0.59$ 1.65$ 3.10$ 1.1$ 180%1.4$ 88%
Total 9.17$ 26.46$ 42.77$ 17$ 189%16.3$ 62%
Source: World Bank
Gross Domestic Product (Trillion)
NAFTA Countries
1990-2050 (Projected)
1990-2020 2020-2050
Country 1990 2020 2040 Change % Change Change % Change
United States 36,070$ 62,517$ 75,700$ 26,447$ 73%13,183$ 21%
Mexico 2,740$ 9,870$ 32,400$ 7,130$ 260%22,530$ 228%
Canada 20,480$ 48,600$ 60,700$ 28,120$ 137%12,100$ 25%
Source: World Bank; PWC
Gross Domestic Product Per Capita
NAFTA Countries
1990-2020 2020-2040
1990-2040 (Projected)
Page 13 of 91
1.11
In terms of population growth, the Nafta countries are projected to have a larger
population in 2040 than the European Union.
1.12
The Baja Influence
Baja California’s population parallels San Diego County’s at 3.3 million. Of the total,
2.0 million live in Tijuana. The population since 2000 has been growing at a pace of
30,000-40,000 persons annually, not that much more than the growth pace of San
Diego County.
Country 1990 2020 2040 Change % Change Change % Change
United States 2.03 1.88 1.91 (0) -7%0 2%
Mexico 3.75 2.14 2.08 (2) -43%(0) -3%
Canada 1.69 1.61 1.60 (0) -5%(0) -1%
Total 7.47 5.63 5.59 (2) -25%(0) -1%
Source: United Nations Population Division
1990-2040 (Projected)
1990-2020 2020-2040
Fertility (Children Per Woman)
NAFTA Countries
Country 1990 2020 2040 Change % Change Change % Change
United States 282,162 325,700 379,200 43,538 15%53,500 16%
Mexico 85,000 129,000 157,690 44,000 52%28,690 22%
Canada 27,791 36,708 43,924 8,917 32%7,216 20%
Total 394,953 491,408 580,814 96,455 24%89,406 18%
Source: United Nations Population Division
Population (Millions)
NAFTA Countries
1990-2040 (Projected)
1990-2020 2020-2040
Page 14 of 91
1.12
Baja California’s economy is driven by five industries, the largest, by far, is the
maquiladora plants with more than 200,000 employees, more than half of them in
Tijuana. The other four industries are agriculture, tourism, wine, medical tourism
and manufacturing. Manufacturing comprises about 20% of the Baja California
economy.
Medical tourism is typically Americans going to foreign countries for medical
procedures, thereby saving substantial amounts. Several major insurance
companies are now covering operations in countries like Mexico. Tijuana, with its
broad range of surgeons and dentists that are U.S. educated, has become a mecca
for medical tourism.
The manufacturing sector focuses on five areas: aerospace, medical devices,
automotive, electronics and contract manufacturing. Tijuana is the maquiladora
center of Mexico with 570 factories employing 115,000 workers. Reportedly, 50% of
the companies operating in Tijuana have a presence in San Diego County.
It is difficult to calculate the economic impact of Tijuana on San Diego, but we know
that 20,000+ persons cross the border to work in San Diego each day and we also
know that during the holiday season, a substantial portion of the retail sales are to
Mexican citizens (particularly at the border discount stores and in the upper-end
stores in Fashion Valley).
What we do not have a strong sense of is the cross-border economic impact of the
maquiladora plants or the number of the maquiladora managerial work force that
lives in San Diego.
Year Population Change
1990 811,688 n/a
2000 1,364,918 553,230
2010 1,754,403 389,485
2019 2,099,293 344,890
Source: United Nations Population Research
Population
Tijuana
1990-2019
Page 15 of 91
San Diego/Tijuana is the busiest land border crossing in the western hemisphere.
The checkpoint processes an average of 70,000 northbound vehicle passengers
and 20,000 northbound pedestrians each day.
In 2017, the port of entry processed 27.5 million vehicles containing 47.6 million
passengers along with 16.5 million pedestrians, according to the U.S. Department
of Transportation.
A $750 million expansion is being made to accommodate the 87% increase in traffic
by 2030 (SANDAG).
The port of entry from the 905 connecting with SR-11 and 125 is the subject of a
major study that is anticipated to be completed this year. The Otay Mesa POE has
become the busiest California-Mexico commercial border crossing with more than
$50 billion in goods passing through it. Caltrans projects that by 2030, there will be
900,000 northbound commercial vehicles passing through the POE. The study
focuses on the costs of border delays.
Indicative of the crossing success is the average weekday traffic on the SR-125
which has increased from 28,000 in 2012 to more than 50,000 this past year.
SANDAG is projecting that by 2030 the ADT (Average Daily Traffic) will surpass
75,000.
1.13
Page 16 of 91
Section 2: The National Economy
As we move into calendar year 2019, it is interesting to note that the Nation is now
in its 11th year of recovery, after a lengthy and devastating recession.
Looking back ten years and quoting our 2018 report for the Otay Water District, the
economy was in a weakened position:
Crude oil was $145 per barrel;
30-year mortgages were at 6.0%;
The unemployment rate was 7.2% and climbing;
Lehman Brothers and Bear Stearns had collapsed;
Construction jobs had declined by 20%, losing 115,000 jobs per month; and
U.S. resale home prices had declined 13% from their 3rd quarter 2006 peak.
Gradually, over the past decade, the economy has strengthened and has
experienced more than 100 continuous months of expansion.
Now it is possible that the Nation will take a “breather.” We are not projecting a
recession, but there are several factors that must be taken into consideration:
rising Federal Funds and mortgage rates
impact of tariffs
general turmoil in Washington, D.C.
a gradual loss of consumer confidence
slowdown in the housing market and
slowdown in several of the international markets in which the Nation does
business, the most important of which is China.
2-1 The Path of the GDP
Despite the continuous growth, it is notable that the gross domestic product has not
risen to the levels of past recoveries. In virtually all modern recoveries, the Nation
has expanded by 5.0% +/-.
Page 17 of 91
The 2nd and 3rd quarters of 2018 were more bullish than in every quarter since the
fourth quarter of 2014, but most of the pundits are projected that the 4th quarter
2018 will be modest with 2019 following the path of the 4th quarter of 2018.
2.1
The GDP is comprised of two factors: first, the expansion in the total dollars
produced in goods and services and second, inflation. Inflation has been the
primary culprit in keeping the GDP increase from reaching previous levels. Inflation
has continued to be in the 2.0% range nationally, perhaps the lowest peacetime
rates in modern history.
The Bureau of Labor Statistics projects the continual low inflation rates through
2023, as noted in the following exhibit:
Page 18 of 91
2.2
2.2 U.S Population Trends
The U.S. continues to expand its population and economy. The population
expansion is perhaps the most important element in the expansion of the Nation.
For an industrialized Nation to expand on a continuing basis, it is necessary to
continue to add population.
From a basic demographic standpoint, it is necessary to have 2.0 children per every
mother and father. If a Nation falls below that level, it faces a long-term stagnation
of its economy.
As discussed in Section 1 of this report,we in the United States are solidly in the 2.0
range which places us among the population leaders in the industrialized world.
Looking out a few decades, we can see that many of the major Nations are
experiencing only minor population growth and in several cases, decline.
Page 19 of 91
The United States continues to gain population at a pace of 2.0-2.5 million annually,
both recently and projected well into the future. Projections anticipate a very gradual
decline in annual population gain. Thus, in the 2020-2025 period, the population
gain is projected to decline from 2.63 million annually to 2.57 million.
2.3
The millennial population is driving the gains in population.
Millennials, by Census Bureau definition, are persons 18-34 years of age. They are
the persons with a very high propensity to spend and do form the basis for the
current rise in automobile, housing, household goods and away-from-home eating
and dining.
The millennial population is at the heart of the rising economy.
Page 20 of 91
2.4
There has been a major change in the lifestyle of millennials as they are staying in
school later and marrying later and having children later.
Still, millennials do get married and eventually have children. A recent Pew
Research study notes:
80% of women with professional degrees or doctorates have a child by the
time they are 44, compared with 65% two decades ago.
55% of never married women ages 40 to 44 have at least one child, up from
31% two decades ago; and
In 1975, 57.0% of what today would be considered millennial-aged individuals
were living with their spouses; now only a quarter of millennials are living
with a spouse.
Now 31% of millennials are living with their parents. There is a major difference in
the percent of millennials living at home in high cost vs. low cost states.
Page 21 of 91
2.5
In high cost states, 40% of millennials still live with their parents compared to 20%
in low cost states. Obviously, at some point, most will move out of their parents’
houses, but it’s a gradual process.
Category 1975 2016
Spouse 57.0%27.0%
Parents' Home 26.0%31.0%
Alone 3.1%8.0%
Other 13.9%34.0%
Total 100.0%100.0%
Source: U.S.Census
Where Millennials Live
United States
1975 and 2016
Page 22 of 91
2.6
There is a strong correlation between home prices and household income levels.
Those metropolitan areas with strong incomes (including dual income households)
also have high housing prices, as shown here for both sale and rental housing:
High Cost States %
New Jersey 47%
Connecticut 42%
New York 41%
Maryland 39%
California 38%
Low Cost States %
North Dakota 14%
South Dakota 20%
Wyoming 21%
Montana 23%
Iowa 23%
Source: U.S. Census
% of Millennials Living in Parents' Home
Low Cost/High Cost States
2015
Page 23 of 91
2.7
Balance/Imbalance Metropolitan Area Median Price
Imbalance San Jose 1,300,000$
Imbalance San Francisco/Oakland 989,000$
Imbalance Orange County CA 830,000$
Imbalance San Diego 650,000$
Imbalance Los Angeles 629,000$
Imbalance Seattle 503,000$
Balance Sacramento 370,000$
Balance Chicago 265,000$
Balance Dallas 262,000$
Balance Austin 318,000$
Balance Phoenix 273,000$
Balance Las Vegas 295,000$
Balance Detroit 54,000$
Source: National Association of Realtors
Existing Single Family Median Home Prices
Major Metropolitan Areas
3rd Quarter 2018
Page 24 of 91
2.8
2.3 U.S. Employment Trends
Since the bottom of the decline in 2009, the Nation has added more than 18.0
million jobs, a pace of more than 2.3 million annually. Although the rate of gain has
slowed somewhat recently, the Nation continues to add 175,000 to 200,000 jobs
monthly.
Metro Avg. Rent
San Mateo 4,390$
San Francisco 3,090$
Manhattan 2,523$
San Diego 2,023$
Philadelphia 1,173$
Dallas 1,110$
Phoenix 1,061$
Source: Rentonomics
Rent Levels
Selected Metropolitan Areas
4th Quarter 2018
Two-Bedroom Units
Page 25 of 91
2.9
2.10
Year Total
Annual
Change
Monthly
Change
2010 130,354 (952) (79)
2011 131,939 1,585 132
2012 134,174 2,235 186
2013 136,374 2,200 183
2014 138,941 2,567 214
2015 141,826 2,885 240
2016 144,348 2,522 210
2017 146,611 2,263 189
2018 149,064 2,453 204
Source: Bureau of Labor Statistics
Total Employment
United States
2010-2018
Page 26 of 91
As a result of job increases, the unemployment rate has plummeted and today
stands at approximately 4.0% nationally.
Inevitably there will be another recession in our future, but we project that the 4.0%
unemployment level will persist another 2-3 years before the market turns softer.
A caveat is if the construction market falters, the unemployment rate could rise.
2.11
One of the key reasons why the unemployment rate has declined is that the labor
force participation rate has been on a sharp declining path since the recession.
There is some indication that as employers are scampering for new labor, and
wages rise, the participation rate is increasing.
Page 27 of 91
2.12
Those returning to the labor force are most often persons over 50 who may have
been retired from other jobs and for several reasons return to the work force. They
include persons who realize they do not have enough funds set aside to retire;
persons who are bored; persons who have moved to new metropolitan areas and
want to get involved in the community.
Also, there are those who realize that their current skill levels are not as advanced
as they need to be to earn a decent income; return to school and prepare for a new
career.
Economic Drivers
In typical economic recoveries, construction and manufacturing lead the way. As
these two industries have a strong multiplier effect, their impact is substantial.
In this recovery, construction and manufacturing jobs have not been at the forefront.
This time, professional and business services, health care and social assistance,
and leisure and hospitality lead the way.
Page 28 of 91
The Bureau of Labor Statistics has projected these economic drivers out through
2026.
2.13
1.5 Residential Construction
The residential construction industry began its recovery from the recession in 2012.
Since then, there has been a steady advancement in both single-family and multi-
family production. Multi-family includes both condominiums and rental housing.
2017 marked the strongest year since 2012 and we project that 2019 will slow
somewhat. In 2019, the total U.S. permit count may dip to the 1.1-1.2 million level.
Industry 2016 2026 Change % Change
Health Care & Social Assistance 19,056 23,054 3,998 21.0%
Professional & Business Services 20,135 22,295 2,160 10.7%
Leisure & Hospitality 15,620 16,939 1,319 8.4%
Construction 6,711 7,575 864 12.9%
Financial Activities 8,284 8,764 480 5.8%
Information Systems 2,772 2,824 52 1.9%
Manufacturing 12,348 11,611 (737) -6.0%
Source: Bureau of Labor Statistics
Economic Drivers - Major Industries (Projections)
United States
2016-2026
Page 29 of 91
2.14
1.6 Non-Residential Construction
A major component of the construction industry is the non-residential sector
which includes both private and public spending. Since 2015, there has been a
steady rise in spending in both the private and public non-residential sector, with a
new high in 2018.
Year SFD MF Total % MF
2008 575 330 905 36%
2009 441 142 583 24%
2010 447 157 604 26%
2011 418 206 624 33%
2012 518 311 829 38%
2013 620 370 990 37%
2014 640 412 1,052 39%
2015 696 487 1,183 41%
2016 750 456 1,206 38%
2017 842 435 1,277 34%
2018 850 415 1,300 32%
2019 (f)750 375 1,125 33%
Source: U.S. Census; forecast by Xpera Group
Residential Construction (000)
United States
2008-2017
Page 30 of 91
2.15
1.7 Forecast of the U.S. Economy: 2019-2021
It would be presumptuous of us to look beyond the 2020 elections in terms of the
economic future of the Nation, but we will summarize here, in bulletpoint fashion,
our national outlook for the next three years:
The population will continue to increase by more than 2.0 milllion
annually;
Employment will proceed at a pace of 2.0-2.25 million jobs annually,
somewhat less than in the past five years;
The unemployment rate will remain in the 4.0-4.5% range;
30-year mortgage rates will remain in the 4.0-5.0% range;
Oil prices per barrel will remain in the $50-60 range;
Construction will fall below the 2018 total with an output of 1.1-1.2
million residential units, not quite as ebullient as in recent past years;
Our projections for residential construction will be affected by the
volume of replacement from natural disasters and the changes to the
financing of affordable rental housing; and
The non-residential construction market will continue to expand
thanks to major increases in infrastructure and military spending.
Type 2015 2016 2017 2018
Private Sector 393,934$ 430,653$ 437,113$ 459,733$
Government Sector 289,622$ 284,531$ 290,047$ 310,156$
Total 683,556$ 715,184$ 727,160$ 769,889$
Source: Census.gov
Millions
Non-Residential Construcition
United States
2015-2018
Page 31 of 91
Section 3: The California Economy
In this section, we discuss the overall economy of the state of California,
including population, employment and housing.
Arguably, California is the 6th largest “nation” in the world in terms of
GDP, tied with India and just above France. It is possible that by 2020,
California would be in 5th place.
3.1
3.1 Population of California
In my book “The Great Divide” the nation is segmented into two types of states:
growth and non-growth. The 15 growth states account for 75% of all the population
growth in the Nation
Placement Nation $ Billions
1 United States 21,482,410$
2 China 14,172,200$
3 Japan 5,220,570$
4 Germany 4,117,070$
5 India 2,957,720$
6 California 2,940,000$
7 France 2,844,700$
Source: usgovernment spending.com
California's World Ranking
2019 Gross Domestic Product
Page 32 of 91
3.2
And perhaps more important, for this report, is that California, Texas and Florida
accounted for 40% of the total population gains in the United States in the past year.
California continues to grow as a result of both natural household formation (more
births than deaths) and in-migration from both within the U.S. and from foreign lands.
California had a net gain of 308,000 persons in Fiscal Year 2017-2018. By the end of
2019, California will have a population of 40,000,000. San Diego will have 8.0% of
that total.
3.2 California Employment
California now has 17.0 million payroll jobs and is adding more than 300,000 jobs
annually. The state is adding more jobs each year than population. The number of
jobs gained has been declining, but appears to have leveled out in 2018.
The Great Divide
Page 33 of 91
3.3
The unemployment rate is slightly above the National average, but is maintaining
the .3% spread on a continuing basis. Note also that the unemployment rate is
reported for only civilians. California has more than 190,000 active military and they
are not included in the employment statistics.
3.4
With the exception of manufacturing, which is nearing its 2008 figures, the other
economic drivers of California are moving forward with strength, as shown here:
Year Employment Change
2014 15,577,383 n/a
2015 16,051,417 474,033
2016 16,478,517 427,100
2017 16,818,692 340,175
2018 17,147,917 329,225
Source: Ca EDD
Payroll Employment
California
2015-2018
Page 34 of 91
3.5
The National Science Foundation recently released a study on research and
development spending per capita for the 50 states. California ranked No. 1, by far,
with a per capita expenditure of $1,175,690, more than the next seven states
combined.
3.6
Overall, the California economy is moving forward with great strength and vivacity.
Category 2008 2018 Change % Change
Construction 725,200 855,183 129,983 17.9%
Manufacturing 1,384,000 1,318,400 (65,600) -4.7%
Professional & Business Services 2,164,600 2,632,783 468,183 21.6%
Leisure & Hospitality 1,546,000 2,003,700 457,700 29.6%
Source: CA EDD
Job Changes by Category
Economic Drivers
California
2008-2018
No. State R&D Per 100,000 People
1 California 1,175,690$
2 Massachusetts 215,600$
3 Washington 196,730$
4 Michigan 188,470$
5 Texas 173,530$
6 New Jersey 157,150$
7 New York 157,140$
8 Illinois 137,330$
9 Pennsylvania 123,000$
10 North Carolina 100,640$
Source: National Science Foundation
The Ten Most Innovative States
Research & Development Spending
Page 35 of 91
3.3 The California Housing Market
It is obvious that California has a housing shortage, at least near the coast. One
way to show the shortage is to compare the number of single family homes
permitted with the population gain.
In this exhibit, we show 11 of the fast-growing states, isolating the three west coast
states (in pink). The three west coast states have the lowest ratio of building permits
to population, indicating the housing imbalance.
3.7
The permitting activity in residential construction passed the 100,000-unit level in
California in 2016, 2017 and in 2018. The last time the state passed the 100,000 level
was 2007 (112,000 units).
State Pop.
Units
Permitted
% of
Permits % of Pop
Ratio
Permits to
Pop. Gain
SC 66,285 28,972 3.5%3.8%44%
NC 111,602 47,545 5.7%6.4%43%
GA 110,973 40,809 4.9%6.4%37%
Colo 91,726 28,019 3.4%5.2%31%
Texas 432,957 116,753 14.0%24.8%27%
Arizona 113,506 28,019 3.4%6.5%25%
Florida 367,525 85,633 10.2%21.0%23%
CA 256,077 58,053 6.9%14.7%23%
Wash 127,710 23,401 2.8%7.3%18%
Oregon 68,831 10,323 1.2%3.9%15%
Ratio of SFD Units Permitted to Population Gain
Selected States
2017
Page 36 of 91
3.8
3.9
Year Total SFD MF
2012 59,638 27,558 32,080
2013 85,472 36,991 48,481
2014 85,844 37,089 48,755
2015 98,233 44,896 53,337
2016 100,265 49,254 51,011
2017 114,780 57,132 57,648
2018 117,079 62,236 54,843
Source: Census.gov
Residential Building Permits
California
2012-2018
Page 37 of 91
The supply of new homes available for owner-occupancy in California has
continued to be below demand levels as the owner-occupancy rate continues to
decline and is among the lowest in the Nation. The National average is 64%.
The prices of existing single-family homes has been on a steady climb throughout
California. At year-end 2018, the average price was $557,600, an increase of
27.1% since 2013.
Note that the rate of increase in 2018 has slowed down substantially with the
average price increasing only 1.7%.
3.10
3.4 Non-Residential Construction
2018 was the strongest year for non-residential construction in modern California
history, totaling more than $32 billion.
We anticipate that 2019 will better the 2018 total as a result of both military and
infrastructure spending.
Year Price Change Change %
2013 438,790$ n/a n/a
2014 453,270$ 14,480$ 3.3%
2015 489,770$ 36,500$ 8.1%
2016 502,490$ 12,720$ 2.6%
2017 549,800$ 47,310$ 9.4%
2018 557,600$ 7,800$ 1.4%
Change
2013-2018 118,810$ 27.1%
Source: California Association of Realtors
Single Family Home Prices (Existing)
California
2013-2018
Page 38 of 91
3.11
3.12
Year $ 000 Index
2012 $ 14,635 n/a
2013 $ 21,681 1.48
2014 $ 23,706 1.62
2015 $ 26,263 1.79
2016 $ 27,389 1.87
2017 $ 29,000 1.98
2018 $ 32,000 2.19
Source: California Homebuilding Foundation
Non-Residential Permit Values ($000)
California
2012-2018
Page 39 of 91
Section 4: The San Diego County Economy
In this section, we discuss the population and employment changes in San Diego
County.
4.1 Population Change, San Diego County
San Diego County remains one of the most dependably growing metropolitan areas
in the United States, although its growth rate is slowing down.
The past few years the rate of growth has slowed to the 20,000 to 26,000
population range. Its slowdown has been partially attributed to the rapid expansion
of the Temecula/Murrieta housing market, whose home prices are substantially less
than San Diego County and are drawing the San Diego population base northward.
4.1
The population gains are a combination of natural household formations and
immigration. Over the past few years, as shown here, the natural increase has
slowed down somewhat. Further, net domestic out-migration (many related to the
Year Population Change
2010 3,101,036
2011 3,135,522 34,486
2012 3,173,442 37,920
2013 3,207,852 34,410
2014 3,247,475 39,623
2015 3,274,141 26,666
2016 3,295,816 21,675
2017 3,320,108 24,292
2018 3,344,430 24,322
No.243,394
%7.8%
Source: CA DOF
Change in Population
San Diego County
2010-2018
Change 2010-2018
Page 40 of 91
southern Riverside County moderate priced housing availability) has increased but
net in-migration has increased.
4.2
In the past six years, Murrieta and Temecula have increased their population
by 15,701, some portion of which relates to out-movement from San Diego County.
4.3
4.2 San Diego County Future Population Change
Based on SANDAG’s most recent projections, the County will add almost 30,000
persons annually over the next two decades, gaining more than 500,000 people in
that timeframe. By 2035, SANDAG projects that the County population will reach
more than 3.8 million.
Net
Natural Net Net Domestic
July 1, 2017 July 1 2018 Number Percent Births Deaths Increase Migration Immigration Migration
3,320,108 3,344,430 24,322 0.7%40,840 21,920 18,920 5,123 15,981 -10,858
July 1 2009 July 1 2010
3,077,633 3,104,581 26,948 0.9%44,493 19,025 25,468 1,480 10,104 -8,624
Source: CA DOF
Components of Change
San Diego County
2009-2018
Total Population Change 2016-2018 Components of Change
City 2012 2018 Change
Murrieta 106,551 113,541 6,990
Temecula 104,470 113,181 8,711
Total 211,021 226,722 15,701
Source: CA DOF
Change in Population
Murrieta and Temecula
2010-2018
Page 41 of 91
4.4
Millennials will continue to drive the consumer economy, including the housing
market. SANDAG is projecting that the number of millennials will remain relatively
constant over the next two decades, a highly positive economic situation for San
Diego County.
Year No.
2017 3,320,108
2035 3,853,698
Change 2017-2035 533,590
Annual Change 29,644
% Change 16.1%
Source: SANDAG
Population Projections
San Diego County
2017-2035
Page 42 of 91
4.5
A recent analysis of Census data by Jones Lang LaSalle indicates that San Diego
County has the highest percentage of millennials of any of the major metropolitan
areas in the Nation. The metropolitan areas shaded in light yellow are in the high
growth states.
Age Group 2016 2035
18-19 94,625 103,488
20-24 268,684 279,283
25-29 282,105 262,591
30-34 252,922 251,167
Total 898,336 896,529
Total Population 3,288,612 3,853,698
Millennials as % of Pop.27.3%23.3%
Median Age 38.5 35.5
Source: SANDAG
The Change in the Millennial Population
San Diego County
2016-2035
Page 43 of 91
4.6
The high level of millennial growth relates to the types of high-paying jobs that have
become available in these strong metropolitan areas.
More than 37% of San Diegans (over age 25) have a bachelor’s degree or higher
compared to 30% nationwide.
Rank Metro
Millenials as
% of Metro
Population
1 San Diego 27.6%
2 Chicago 27.3%
3 Philadelphia 26.5%
4 Houston 26.3%
5 Dallas 26.0%
6 Los Angeles 25.4%
7 New York 25.1%
8 San Antonio 24.0%
9 Phoenix 23.0%
10 San Jose 22.3%
Source: U.S. Census, JLL
Millenial Rankings
Major Metropolitan Areas
United States
2017
Page 44 of 91
4.7
San Diego County has the fifth highest percentage of population with a Ph.D.:
4.8
4.3. Employment and Economic Situation
San Diego County continues to be one of the strongest and dependable
metropolitan areas in the Nation as a result of its highly diversified employment
base.
In the past six years, the County has averaged 31,000 new civilian jobs annually,
almost matching the population gain.
Level SD Co.U.S.
High School or Higher 86.7%87.3%
Bachelor's Degree or Higher 37.8%30.9%
Source: Census American Community Survey 2017
Levels of Education
(Persons Over 25)
San Diego County & U.S.
2017
Rank Metro Rate
1 Boston 3.1%
2 Washington DC 3.1%
3 San Francisco 2.8%
4 Baltimore 2.1%
5 San Diego 2.0%
Source: San Diego Economic Development Corp.
% of Population with a Ph.D. or Higher
Page 45 of 91
The result of this situation is that the civilian unemployment rate has dipped below
4.0%. If the statistics included the military (100,000 in uniform, 100% of whom are
employed), the unemployment rate would be still lower.
4.9
In 2018, the County added 26,467 jobs, modestly below the average of the past six
years, but still evidence of a strong economy.
Year Employment Change
2012 1,294,400 n/a
2013 1,327,500 33,100
2014 1,355,900 28,400
2015 1,395,900 40,000
2016 1,431,600 35,700
2017 1,453,933 22,333
2018 1,480,400 26,467
Average 31,000
Source: CA EDD
Total All Industry Employment
San Diego County
2012-2018
Page 46 of 91
4.10
4.11
Local economies expand as a result of the growth in economic drivers. An
economic driver is an industry whose source of revenue is mostly from outside the
metropolitan area.
Most metropolitan areas have, at best, two or three economic drivers. San Diego is
most fortunate to have eight basic economic drivers as shown on the following
page. Unquestionably, the military continues to dominate and accounts for as much
as 25% of the total gross domestic product.
But the other seven are also meaningful to the economy and, for the most part,
continue to expand.
Page 47 of 91
4.12
Although not technically an economic driver, we want to include the construction
sector because of its economic impact and a rapid return to health. Since 2012, the
construction sector has increased jobs by 42%.
The construction industry is also highly important because of its multiplier factor.
For every dollar spent in construction, more than twice that ripples through the local
economy. Few industries can boast of that multiplier.
Category No.
Professional & Business Services 254,200
Leisure & Hospitality 193,900
Manufacturing 115,400
Department of Defense (Uniformed)95,000
Colleges & Universities 49,200
Federal Government (non-defense)24,800
Information 24,300
Department of Defense (Civilian)22,000
State Government 17,200
Total 796,000
Source: US BLS
Economic Drivers
San Diego County
2019
Page 48 of 91
4.4 Income of the Population
The most recent American Community Survey produced by the Census Bureau
shows a median household income of $70,588. According to the ACS, there are 1.1
million households in the County and fully one-third have a household income of
more than $100,000 and another 13% have an income from $75,000-99,999.
4.13
4.5 Assessed Valuation
Indicative of the strength of the economy is the continual increase in real property
assessed valuation. Values have typically increased 5-6% per annum, except that
2017-2018 was a particularly bullish year.
Income Range No. Households %
Less than $25,000 183,437 16.5%
$25,000-49,999 215,677 19.4%
$50,000-74,999 184,549 16.6%
$75,000-99,999 143,414 12.9%
$100,000+384,662 34.6%
Total 1,111,739 100.0%
Median Income 70,588$
Source: 2017 American Community Survey
Household Incomes
San Diego County
2017
Page 49 of 91
4.14
FY Millions Change % Change
2014-2015 404,699$ n/a n/a
2015-2016 427,932$ 23,233$ 5.7%
2016-2017 451,659$ 23,727$ 5.5%
2017-2018 512,372$ 60,713$ 13.4%
2018-2019 543,681$ 31,309$ 6.1%
San Diego County Assessor
Assessed Valuation
San Diego County
2014-2019
Page 50 of 91
Section 5: The San Diego County Housing Market
In this section, we discuss the current and future state of the San Diego County
housing market.
5.1 Composition of the Housing Inventory
The inventory of the County housing market consists of 1,124,430 units, half of
them detached; 16.4% condominiums; 30.8% apartments and 2.3% mobile homes.
5.1
5.2 Recent and Current Housing Construction
After a dismal decade of limited housing production, residential construction is
moving forward. The permit count is still driven by the multi-family segment.
It is notable that the production of single family units expanded substantially in 2017
and 2018.
Type No. Units %
Single Family Detached 567,260 50.4%
Condominiums 184,820 16.4%
Apartments 346,455 30.8%
Mobile Homes et al 25,895 2.3%
0.0%
Total 1,124,430 100.0%
Source: SD County Assessor
Current Housing Units
San Diego County
2017
Page 51 of 91
5.2
The multi-family component in 2017 was almost entirely rental apartments, with a
major segment of them in downtown San Diego. The unusually large number of
rental units being built downtown resulted from multiple land purchases 2-3 years
ago by major national apartment builders like Trammel Crow, Alliance, Lennar and
Greystar.
It is highly probable that they did not realize that they would all break ground near-
simultaneously. In 2018-2019, there will be more than 4,000 units completed
downtown.
There were also several thousand units of affordable housing developed in the
County in the past year.
Year Total
Single
Family
Multi-
Family % MF
2012 5,687 2,198 3,489 61.4%
2013 8,264 2,565 5,699 69.0%
2014 6,871 2,478 4,393 63.9%
2015 9,893 3,253 6,640 67.1%
2016 10,666 2,341 8,325 78.1%
2017 10,415 4,058 6,357 61.0%
2018 10,500 3,500 7,000 66.7%
Average 8,899 2,913 5,986 66.7%
2012-2014 6,941 2,414 4,527 64.7%
2015-2018 10,369 3,288 7,081 68.2%
Source: Census Bureau Construction Permit Survey
Residential Units Permitted
San Diego County
2012-2018
Page 52 of 91
5.3 Projections for Residential Construction
As we look out over the next few years, we foresee several changes occurring in
the San Diego County housing market:
As a result of a major increase in shovel-ready dirt, predominantly in south
County and along Highway 78 in north county, there will be a substantial
increase in overall production in the next few years;
The multi-family category, which includes both sale and rental product, will
experience a substantial increase in townhome-type for sale housing;
Apartment construction, which has been in a boom mode the past three
years, will slow down; and
There will be a concerted countywide effort to encourage higher density in
urban areas, particularly those within a 20-30 minute drive of downtown San
Diego.
Based on calculations by SANDAG, San Diego County has a housing shortage of
100,000 housing units. Xpera Group is certain that there is a housing shortage, and
it is possible that it is approaching 100,000 units, but even if 100,000 is an ebullient
calculation, there is definitely a shortage, mostly of work force housing – sale and
rental housing appropriate for the mainstream of San Diego households.
The following exhibit documents our projections through fiscal year 2024-2025:
Page 53 of 91
5.3
The last year since 2000 that the County permitted 10,000 units was 2006. The
peak year was 18,000 units in 2003.
Year Total
Single
Family
Multi-
Family % MF
2010 3,494 2,270 1,224 35.0%
2011 5,370 2,245 3,125 58.2%
2012 5,687 2,198 3,489 61.4%
2013 8,264 2,565 5,699 69.0%
2014 6,871 2,478 4,393 63.9%
2015 9,893 3,253 6,640 67.1%
2016 10,666 2,341 8,325 78.1%
2017 10,415 4,058 6,357 61.0%
2018 10,500 3,500 7,000 66.7%
2018-2019 9,500 3,500 6,000 63.2%
2019-2020 8,500 3,500 5,000 58.8%
2020-2021 7,500 3,000 4,500 60.0%
2021-2022 7,500 3,000 4,500 60.0%
2022-2023 8,000 3,500 4,500 56.3%
2023-2024 8,000 3,500 4,500 56.3%
2024-2025 8,000 3,500 4,500 56.3%
Source: Census Bureau 2010-2018; projections Xpera Group
Residential Construction
San Diego County
Projections in Fiscal Years
Projections thru FY 2025
2010-2018 in Calendar Years
Page 54 of 91
5.4 The Price of Housing
The price of existing housing continues to escalate in San Diego County, both for
detached and attached housing. At year-end 2018, the median price of a detached
home was $640,000 and an attached home $420,000. Since 2013, detached
homes have risen in price by 6.0% annually and attached housing 7.0%
5.4
5.5
Year Detached Attached
2013 479,690$ 294,000$
2014 495,000$ 326,000$
2015 532,000$ 352,000$
2016 556,000$ 365,000$
2017 610,000$ 405,000$
2018 640,000$ 420,000$
Change 2013-2018 160,310$ 126,000$
% Change 33%43%
Annual % Change 6%7%
Source: California Assoc. of Realtors
Median Home Prices
San Diego County
2013-2018
Page 55 of 91
Overall, the San Diego County housing market is stable, but slowing down from the
aggressive sales paces and pricing of the past few years. We anticipate that sales
will be stable with prices moving up very slowly, as opposed to the past few years.
The County economy continues to grow and, for that reason, we remain positive
about its future but do not anticipate the type of fervor that drove the for sale
inventory to near zero and often spirited bidding for homes.
Page 56 of 91
Section 6: The Future of South County
In Section 6, we look at the future of South County as an integral part of San Diego
County.
Section 6.1: Population and Housing in the OWD Service Area
The Otay Water District Area encompasses 125 square miles and services an
estimated 225,000 persons. Most of the area served is within the City of Chula Vista
with the balance in the unincorporated area of San Diego County.
6.1
In 2018, the District served 50,045 with potable water and saw the highest increase
in connections compared to the prior six years. The 2018 increase was due mostly
to the development activity in the Otay Ranch.
Page 57 of 91
6.2
6.2 Population and Residential Units in Chula Vista
As Chula Vista is the largest city in south County and the OWD encompasses most
of the City east of I-805, we think it appropriate to note the City’s growth pattern in
recent years.
In the following exhibit below, the population growth pattern in the years 2000-2018
changed dramatically by time period. There was a major burst of population gain as
a result of the housing boom of the early 2000’s, followed by the major recession of
2007-2009. The recent supply of “shovel ready” dirt has resulted in a major increase
in annual population since 2015.
Year Customers Change
2013 48,962 297
2014 49,148 186
2015 49,308 160
2016 49,425 117
2017 49,502 77
2018 50,045 543
Source: OWD
Customers Served
Otay Water District
2013-2018
Potable Water
Page 58 of 91
6.3
As of January 2018, there were an estimated 84,210 residential units in Chula
Vista, an increase of 25,000 units since 2000.
6.4
Year Population
Total
Increase
Annual
Increase
2000 181,613 n/a n/a
2005 224,006 42,393 8,479
2010 245,987 64,374 6,437
2015 261,801 15,814 3,163
2018 267,503 21,516 7,172
Source: Ca Department of Finance
Population
City of Chula Vista
2000-2017
January
of each
Year Units
Total
Increase
Annual
Increase
2000 59,492 n/a n/a
2005 73,531 14,039 2,808
2010 79,416 5,885 589
2015 82,499 3,083 440
2018 84,210 1,711 570
Source: Ca Department of Finance
Residential Units
City of Chula Vista
2000-2018
Page 59 of 91
From 2016 to 2018, the permit count was over 1,000 units, but there was a major
difference between 2016 and 2017 or 2018. In 2016, single family units accounted
for only 8.0% of the total units permitted. This past two years, 2017 and 2018, as a
result of new lots being developed in Otay Ranch, there was a major increase in
single family units permitted.
6.5
When the housing market was torrid in the early to mid-2000’s, Chula Vista’s
housing production accounted for a substantial portion of the County output.
For instance, in the 2004-2007 period, Chula Vista residential production accounted
for 14.4% of the County output, compared to 7.0% in the 2013-2015 period.
With Otay Ranch in full production, it is highly likely that Chula Vista’s share of the
County permit activity will increase substantially.
In the 2017-2018 period, single family permits ballooned and accounted for 13.9%
of the County total in 2017 and 18.4% in 2018. In 2018, as a result of several major
apartment and townhome projects, Chula Vista’s multi-family permits accounted for
18.4% of the County’s total units permitted.
Year Total
Single
Family
Multi-
Family
2010 517 296 221
2011 728 394 334
2012 799 304 495
2013 630 269 361
2014 475 156 319
2015 689 89 600
2016 1,050 86 964
2017 1,073 563 510
2018 1,882 644 1,238
Source: City of Chula Vista & CIRB
Residential Building Permits
City of Chula Vista
2010-2018
Page 60 of 91
6.6
6.3 Resale Home Prices – Otay Ranch
The resale housing market in the Otay Ranch remains buoyant. Detached homes
decreased in the number of sales from 2016 through 2018, but that may be
because of the large number of detached homes that came to market in the past 18
months. In both 2017 and 2018, detached homes prices increased at the same
percent: 6.7% in 2016-2017 and 7.0% in 2017-2018.
In the attached sector (virtually all townhomes – i.e. few flats), sales were healthy in
all three years and prices continued to increase. In 2017 prices increased 9.2% and
in 2018 8.5%.
Year Total
Single
Family
Multi-
Family Total
Single
Family
Multi-
Family Total
Single
Family
Multi-
Family
2010 3,494 2,270 1,224 517 296 221 14.8%13.0%18.1%
2011 5,370 2,245 3,125 728 394 334 13.6%17.6%10.7%
2012 5,687 2,198 3,489 799 304 495 14.0%13.8%14.2%
2013 8,264 2,565 5,699 630 269 361 7.6%10.5%6.3%
2014 6,871 2,478 4,393 475 156 319 6.9%6.3%7.3%
2015 9,893 3,253 6,640 689 89 600 7.0%2.7%9.0%
2016 10,666 2,341 8,325 1,050 86 964 9.8%3.7%11.6%
2017 10,415 4,058 6,357 1,073 563 510 10.3%13.9%8.0%
2018 10,500 3,500 7,000 1,882 644 1,238 17.9%18.4%17.7%
Source: Census.gov
Residential Permits
Chula Vista & San Diego County
2010-2018
SD County Chula Vista CV as % of County
Page 61 of 91
6.7
6.4 Future Growth in South County
Since our first OWD forecasts 8-9 years ago, there has been substantial
commercial/residential activity in the OWD service areas and still much more to
come.
In the exhibit below, we have listed the projects that are in the pipeline or have been
recently completed. Perhaps the most important of these is the substantial supply of
residential shovel-ready land for both single family and multi-family housing.
2018 was a very productive year for south San Diego County. Perhaps the three
most important projects are the Sudberry shopping center in Millenia, the Sunroad
plans for their master-planned community in Otay Mesa and the rapid transit bus
route.
ZIP AREA 2016 2017 2018 2016 2017 2018 $%$%
Detached
91913 West 469 409 390 539,000$ 565,000$ 609,450$ 26,000$ 4.8%44,450$ 7.9%
91914 North 204 179 157 688,000$ 725,000$ 799,900$ 37,000$ 5.4%74,900$ 10.3%
91915 South 335 295 265 525,000$ 580,000$ 605,000$ 55,000$ 10.5%25,000$ 4.3%
Total 1008 883 812 564,502$ 602,446$ 644,821$ 37,944$ 6.7%42,375$ 7.0%
Attached
91913 West 288 299 277 332,500$ 365,000$ 399,000$ 32,500$ 9.8%34,000$ 9.3%
91914 North 66 66 157 357,500$ 390,000$ 407,000$ 32,500$ 9.1%17,000$ 4.4%
91915 South 205 236 212 375,000$ 405,000$ 420,000$ 30,000$ 8.0%15,000$ 3.7%
Total 559 601 646 351,038$ 383,453$ 407,836$ 32,415$ 9.2%24,383$ 8.5%
Source: SDAR
Home Prices (Existing Units)
Otay Ranch
2016-2017-2018
Sales Change 2017-2018Median Price Change 2016-2017
Page 62 of 91
6.8
Major
Progress
since last
report
2017-2020 2020-2022 2022-2024+Activity Category
X X
26-mile South Bay Rapid Transit Bus Route under
way - serving the Otay Ranch area Transportation
X X Shovel-Ready Dirt in ample supply Residences
X X
Sudberry shopping center groundbreaking in
Millenia Retail
X X X X
Substantial improvements in the San Ysidro
crossing Transportation
X X X X
Sunroad announced plan to build 3,258 residential
units and 765,000 s.f. of industrial space and 78,000
square feet of retail space on on its 253 acres Residences
X X Completion of SR-11 Transportation
X X
Widening of I-805 - one additional lane in each
direction, under way Transportation
X X
Cross Border Express with major plans for adjacent
properties Transportation
X X
Transfer of SR-125 to CalTrans; Major reduction in toll
fees Transportation
X X
Completion of Mesa de Otay II Port of Entry (20
northbound lanes)Transportation
X X
Initiation of Eastern Urban Center (Millenia)
development - 2,500 units Residences
X X
Apex Power Group building $400 million Pio Pico
"peaker plant" on eastern edge of Chula Vista Employment
X X X
Build-out of additional housing on Otay Ranch (20,000+
units)Residences
X X X Build-out of housing on Otay Mesa (10,000+ units)Residences
X
Brown Field commercial traffic expansion; cargo
volume increase Transportation
X X
Major residential development on the eastern side of
Tijuana (primarily Las Palmas)Residences
X X
Major commercial development on eastern side of
Tijuana Employment
X X
New Town of 500,000 people to be developed in the
eastern side of Tijuana Residences
X X Employment Growth along SR-125 and SR and 905 Employment
X Development of university campus on Otay Ranch Education
X
Development of major employment center on both
sides of SR11 (area has 4,000 acres, 40% of County's
developable employment land Employment
X Completion of 3 more interchanges on SR-125 Tollway Transportation
Proposed Planned Projects Effecting
Otay Water District
South San Diego County
2018-2025
Time Span
Page 63 of 91
Exhibits of the substantial activity near the border appear below:
Sunroad’s Proposed Residential Development
6.9
Sudberry’s Millennia Commons
6.10
Page 64 of 91
South Bay Rapid Transit
6.11
In addition to the projects noted above, there is substantial activity on the western
side of Chula Vista, including the $1.1 billion RIDA/Marriott 1,600 room hotel
conference center on the Bayfront. The Center will include a 415,000 square foot
convention center. Groundbreaking is announced for spring of this year.
6.12
Page 65 of 91
Section 7: Future Development – OWD Service Area
In Section 7, we discuss the residential and commercial development that will take
place in the Otay Ranch and in the Otay Mesa region that is served by the OWD.
7.1 Current Residential Development
In 2016, there was virtually minimal residential development in the Otay Water
District area. Since then, the area has exploded with new single family and multi-
family development.
At the current time, there are 20 single family projects actively selling and 21 multi-
family projects, as well as several apartment developments.
The single-family projects range in price from $497,000 to $1,084,000 or $220 to
$299 per square foot.
The multi-family housing sells for $367,000 to $542,000 or $277 to $334 per square
foot.
It is typical for multi-family housing to sell for more per square foot than single-
family homes because of the marginal square footage differential.
Of the 2,920 units that have been brought to market, 1,285 remain to be sold.
This exhibit contains only sale product.
7.1
Total
Projects Total
Units
Units
Sold
Units
Remaining Sq.Ft.
Low Price Low $/Sq.Ft.Sq.Ft.
High Price High $/Sq.Ft.
Detached 20 606 276 330 2,678 648,219$ 242$ 3,014 678,791$ 225$
Attached 21 2,314 1,343 955 1,437 406,017 285 1,922 472,969$ 246$
Total 41 2,920 1,619 1,285
New Residential For Sale Projects
Otay Ranch/Otay Mesa
San Diego County
YE 2018
Page 66 of 91
7.2 Future Residential Development
Virtually all new residential construction in the OWD service area that will take place
over the next few years will be in the greater Otay Ranch area, although Sunroad’s
East Mesa project could break ground by 2020-2021.
Most of that development will take place in the Millenia community and in Villages
2,3,8, 9 and 10.
7.2
Although it is difficult to project home sales and apartment construction going out
seven or eight years, we have contacted the relevant landowners in the Otay Ranch
community and have been able to prepare an exhibit that shows a total of more
than 12,000 units that are anticipated to come on-line in that timeframe. Most of the
future activity is anticipated to take place in 2019 through 2022.
Page 67 of 91
Note that Villages 8, 9 and 10 in Otay Ranch will ultimately have 11,000+ units, but
only 2,358 units are anticipated to be developed in the 2019-2025 timeframe.
7.3
The following exhibit displays the projected single family development activity at
Otay Ranch:
Community Developer 2018 2019 2020 2021 2022 2023 2024 2025 Total
Village 2
Baldwin, Cornerstone,
R&V 623 749 470 101 50 50 42 2,085
PA12 Baldwin 292 453 52 32 - - - 829
Village 3 (Escaya)
Brookfield, Shea,
CalAtlantic, HomeFed 946 600 70 - - - - 1,616
Millenia Meridian 502 1,022 259 150 - - - 1,933
Village 4 Hunsaker - - 50 207 166 - - - 423
Villages 8,9,10 HomeFed - 731 792 412 299 124 - - 2,358
Village 13 Moeller - - - 107 50 50 50 50 307
Village 14 Jackson Pendo - - - - 50 50 50 50 200
Planning Areas 16
& 19 Jackson Pendo - - - 25 25 25 50 - 125
Total 2,363 3,555 1,693 1,034 640 299 192 100 9,876
Source: BIA, land owners, builders & City of Chula Vista
Projected Development Activity
Otay Ranch
2018-2025
Page 68 of 91
7.4
In the 2018-2025 period, the unit mix is anticipated to be approximately 1/3rd single
family and 2/3rd multi-family. The multi-family will be a mix of townhomes and
vertical construction; for sale and for rent.
Community Developer 2018 2019 2020 2021 2022 2023 2024 2025 Total
Village 2
Baldwin, Cornerstone,
R&V 220 220 90 51 - - - - 581
PA12 Baldwin 39 38 - - - - - - 77
Village 3 (Escaya)
Brookfield, Shea,
CalAtlantic, HomeFed 398 333 70 - - - - - 801
Millenia Meridian - - - - - - - - -
Village 4 Moeller - - 15 39 19 - - - 73
Villages 8,9,10 HomeFed - 263 50 232 232 67 - - 844
Village 13 Moeller - - - 50 50 50 50 50 250
Village 14 Jackson Pendo - - - - 50 50 50 50 200
Planning Areas 16
& 19 Jackson Pendo - - - 25 25 25 50 - 125
Total 657 854 225 397 376 192 150 100 2,951
Source: BIA, land owners, builders & City of Chula Vista
Projected Development Activity
Single Family
Otay Ranch
2018-2025
Page 69 of 91
7.5
The projections for each of the communities can be found in the Appendix of this
report.
There are three properties in the immediate vicinity of the OWD headquarters that
will move forward with development in the near-term future: Sweetwater Vistas
(Douglas Wilson Co.); Sweetwater Place (Mastercraft) and Sweetwater Village
(Lennar). They total 433 units.
Community Developer 2018 2019 2020 2021 2022 2023 2024 2025 Total
Village 2
Baldwin,
Cornerstone,
R&V 403 529 380 50 50 50 42 - 1,504
PA12 Baldwin 253 415 52 32 - - - - 752
Village 3 (Escaya)
Brookfield, Shea,
CalAtlantic,
HomeFed 548 267 - - - - - - 815
Millenia Meridian 502 1,022 259 150 - - - - 1,933
Village 4 Moeller - - 35 168 147 - - - 350
Villages 8,9,10 HomeFed - 468 742 180 67 57 - - 1,514
Village 13 Moeller - - - 57 - - - - 57
Village 14 Jackson Pendo - - - - - - - - -
Planning Areas 16
& 19 Jackson Pendo - - - - - - - - -
Total 1,706 2,701 1,468 637 264 107 42 6,925
Source: BIA, land owners, builders & City of Chula Vista
Projected Development Activity
Multi-Family (Sale and Rental)
Otay Ranch
2018-2025
Page 70 of 91
7.6
We have also added 100 units annually for small developments which may take
place within the Otay Water District.
In total, in the 2019-2024 time-frame, we project a total of more than 12,000 units or
on the order of 1,500-1,600 units annually.
7.7
Project Developer Unit Type No. Units
Sweetwater Villas Douglas Wilson Townhomes 218
Spring Valley Retail Center Lennar SFD 93
Sweetwater Village Mastercraft SFD 122
Total 433
Proposed Residential Development
Sweetwater Springs Area
as of March 2019
Community Developer 2018 2019 2020 2021 2022 2023 2024 2025 Total
Otay Ranch Multiple 2,363 3,555 1,693 1,034 640 299 192 100 9,876
Sunroad East
Otay Mesa Sunroad - - 300 300 300 300 300 1,500
Sweetwater
Projects
Douglas
Wilson, et al 100 100 100 133 433
Salt Creek n/a 100 100 200
Misc. Parcels Multiple 100 100 100 100 100 100 100 700
Total 2,463 3,655 1,893 1,634 1,240 832 592 400 12,709
Note: We have no knowledge
Source: BIA, land owners, builders & City of Chula Vista
Total Residential Development Programs
Otay Water District Service Area
2018-2025
Page 71 of 91
Rental Apartments
Within Otay Ranch, there are 1,320 rental apartment units that are in the pipeline,
including Alexan I which opened in 2018. In total, there are 1,320 units that will be
developed by 2021.
7.8
7.3 Non-Residential Development
There are several non-residential projects within the OWD service area that are
planned for the near future that will result in demand for more water.
Retail
The two retail projects that are under construction are Sudberry’s new Millenia
Commons and Baldwin’s Suwerte. The Sudberry project, with 135,000 square feet,
will contain four “big box” stores and adjacent in-line stores. It is nearing completion.
The Baldwin Suwerte project is a multi-product project with approximately 12,000
square feet of retail space. It is under construction.
A third center, The Shoppes at Escaya, with 20,272 square feet will be completed in
2020.
Project Developer Units Completion
Alexan I Trammell Crow 309 2018
Alexan II Trammell Crow 253 2019
Village 8, West Lot 2 (Affordable)Meta Housing 175 2020
Village 8 West HomeFed 283 2020
n/a Baldwin 300 2021
Total 1,320
Apartments
In Planning, Under Construction and Completed
Otay Ranch
as of February 2019
Page 72 of 91
A fourth center, with 15,000 square feet, seeking approval for a site north of the
Otay Center would be developed by Baldwin along with 300 apartments, 272
condominiums and a hotel.
There will be several smaller centers that will be built within the Otay Ranch as the
Villages get built out, but none yet has been announced.
7.9
Hotels
There are several hotels that have come on-line and have opened for business in
the past year.
The first two entries are Ayres with 135 rooms and a Residence Inn with 148 rooms,
both near the 125 at Olympic Parkway. A Hampton Inn and Homewood Suites are
nearing completion. Baldwin is planning a Courtyard by Marriott with 150 rooms.
Center Developer Sq.Ft.Completion
Millenia Commons Sudberry 135,000 2019
Suwerte Baldwin 12,000 2019
The Shops at Escaya HomeFed 20,272 2020
n/a Baldwin 12,000 2020
Sunroad Otay Mesa Sunroad 78,000 2022
Total 257,272
Retail Space
Otay Ranch
as of February 2019
In Planning, Under Construction and Completed
Page 73 of 91
7.10
Senior Housing
Recently completed is a 104-unit senior housing facility with 80 units of assisted
living and 24 units for memory care patients. The developer is Douglas Wilson
Company and Milestone Retirement Communities.
Office Space
Office space is not a major factor in the Chula Vista/Otay Mesa commercial market,
totaling 3.0% of the San Diego office marketplace.
The overall vacancy rate for office space there is 10.6%.
Hotel Address Rooms Completion
Residence Inn 2005 Centerpark Rd.148 2018
Ayres 1710 Millenia Avenue 135 2019
Hampton Inn 2424 Fenton St.104 2019
Homewood Suites 2424 Fenton St.91 2019
Courtyard Olympic Parkway 150 2020-2021
Village 13 Resort Village Village 13 200 2025-2030
Hotels In Planning, Under Construction and Completed
Otay Ranch
as of February 2019
Page 74 of 91
7.11
The major office development that is actively planned is the “Millenia Office” – a
project that could ultimately have more than 1.0 million square feet of space.
The first project is 318,000 square feet of Class “A” space – awaits a major tenant
before breaking ground.
The project is by Chesnut Properties, a local firm that has substantial success in
other parts of the County.
There is no office space under development at the current time in Otay Mesa or
Otay Ranch or the City of Chula Vista, although additional medical facilities are in
planning by at least one hospital.
Industrial Space
Otay Mesa has more than 15.0 million square feet of industrial space, most of it “big
boxes” utilized for storage/warehousing. The vacancy rate for industrial space in
Otay Mesa is now 7.6%, one of the lowest rates for the area in many years.
Area Sq.Ft. - Total Inventory Vacancy Rate
Otay Mesa 187,078 2.3%
Chula Vista 2,905,034 8.1%
Total OM/CV 3,092,112 7.6%
San Diego County 103,001,492 10.6%
OM/CV as % of SD Co.3.0%
Office Space Market
Chula Vista/Otay Mesa and San Diego County
as of February 2019
Page 75 of 91
7.12
This past year, more than 300,000 square feet of industrial space was completed in
Otay Mesa. In total, there are more than 900,000 square feet of industrial space
under construction.
7.13
Area Sq.Ft. - Total Inventory Vacancy Rate
Otay Mesa 15,839,477 7.6%
Chula Vista 9,653,685 3.2%
Total OM/CV 25,493,162
San Diego County 189,139,372 5.0%
OM/CV as % of SD Co.13.5%
Kidder Mathews
Industrial Space Market
Chula Vista/Otay Mesa and San Diego County
as of February 2019
Area Sq.Ft. U/C 2018 Sq.Ft. Completions
Otay Mesa 749,176 329,254
Chula Vista 163,000 0
Total OM/CV 912,176 329,254
San Diego County 17,477,217 3,249,639
OM/CV as % of SD Co.5.2%10.1%
Kidder Mathews
Industrial Space Under Construction
Chula Vista/Otay Mesa and San Diego County
as of February 2019
Page 76 of 91
The following exhibit notes the individual projects in planning, under construction
and in the pipeline in Otay Mesa:
7.14
The market is dominated by the Murphy Company which has developed industrial
space there for several decades.
Currently, the firm is developing the Brown Field Technology Park and is
redeveloping the existing San Diego Business Park (once home to Sanyo).
Rather than the traditional industrial space with one employee per 1,000 square
feet, we anticipate that the Brown Field Technology Park space will be occupied by
employment types that will be more labor intensive. The employment types we
anticipate will be more service oriented and have as many as two persons per
1,000 square feet.
Property Developer Location Sq.Ft.
Est. Date of
Completion
Building 17 Murphy Otay Mesa 79,050 2019
Brown Field Tech Park 1-B Murphy Otay Mesa 126,333 2019
San Diego Bus. Park -2055 Sanyo Ave (1)Murphy Otay Mesa 352,378 2019
Otay Logistics Center
Black Creek
Group Otay Mesa 243,000 2019
Majestic Sunroad Center Sunroad/Majestic Otay Mesa 227,000 2020
Brown Field Tech Park 1-C Murphy Otay Mesa 108,247 2020
Brown Field Tech Park 1-A Murphy Otay Mesa 201,342 2020
Otay Crossings - 311 acres; 1st Phase:
111 acres (2)
Kearny Real
Estate Co.Otay Mesa 2,900,000 2020-2025
Sunroad East Mesa Sunroad/Majestic Otay Mesa 765,000 2020-2025
Total 5,002,350
(1) renovation of existing facility
(2) now offering lots for salesq.ft. projection is based on first 11 acres
Source: Murphy Development Co. & various other sources
Planned and Active Industrial Development
Chula Vista/Otay Mesa
as of February 2019
Page 77 of 91
Miscellaneous Development
There are three major projects on the horizon that deserve mention: Sunroad East
Otay Mesa Business Park, University Village and Brown Field.
The Sunroad project was originally going to contain a major shopping center with a
Target store, but has recently replanned the site for a combination of 3,100 multi-
family units, 78,000 square feet of retail space and 765,000 square feet of
industrial/tech park space. Sunroad is No.1 in the aerial below:
7.15
Page 78 of 91
Most of the Salt Creek Golf Course, now closed for business, will be offered for
development with approximiately 80 of the 245 acres reserved for habitation and
other non-commercial uses.
At University Village (Village 3 & 4), there is a proposed campus of St. Katherine
University, now based in San Marcos. The school currently has 1,000 students.
Reportedly, the City of Chula Vista is in final negotiations with St. Katherine
representatives. The 10-acre campus is planning housing for 400 students.
The land use plan also calls for a total of 1,597 residential units: 1,002 single-family
homes, 317 multi-family units and 278 mixed-use units as well as 29.3 acres of
industrial space.
Brown Field
Brown Field is within the City of San Diego, but worth noting because of its potential
for enhancing employment growth in South County. The most recent plans call for
development of a 14,000 square foot terminal building and 87 new hangars with a
total of 111,000 square feet.
A local developer will construct the hangars and also has plans for a 150 and a 125-
room hotel. On 208 acres of the site, the developer has plans for commercial and
industrial space.
7.16
Property Developer Location Type Acres
Est.
Date of
Comple
tion
Sunroad East
Otay Mesa Bus.
Park Sunroad 125 & Otay Mesa Rd.
Mixed use, including 3,100
housing units, 78,000 square feet
of retail space and 765,000
square feet of industrial/high tech
space. 253 n/a
Salt Creek Golf
Course n/a
Hunte Parkway, east
of SR0125
164 acres to be sold; 80 acres to
remain undeveloped 245 2025
University Village n/a Innovation Center
First project: St. Katherine's
University in planning with 1,000
students 1,281 n/a
Brown Field City of S.D.Otay Mesa Road Airport with com'l development 880 2038
Proposed Miscellaneous Development Activity
Chula Vista/Otay Mesa
as of February 2019
Page 79 of 91
Section 8: Projections for OWD Development Activity 2018-2024
In this section, we discuss the projections for both residential and non-residential
development in fiscal years 2018-2019 through 2023-2025.
8.1: Residential Development Projections
We are confident that the next few years will be unusually vibrant on the Otay
Ranch as the major landholders will continue to develop shovel-ready lots. Better
yet, we anticipate that the market for the product developed there will be well
accepted, as it represents a wide range of product types and prices/rents.
For definition’s sake, we are assuming that “for sale” multi-family product will be
townhomes or other varieties of attached for sale product.
The rental product is assumed to be multi-story flats, but, at some point, developers
may produce “for sale” flats – i.e. vertical condominiums.
In the projection below, we anticipate that most of the development in the OWD
service area will be in the Otay Ranch. Having said that, there are two projects that
could surface during our projection period: those two are Salt Creek (discussed
earlier in the report) and the Sunroad East Otay Mesa project.
8.1
Fiscal Years:20
1
8
-
2
0
1
9
20
1
9
-
2
0
2
0
20
2
0
-
-
2
0
2
1
20
2
1
-
2
0
2
2
20
2
2
-
2
0
2
3
20
2
3
-
2
0
2
4
20
2
4
-
2
0
2
5
To
t
a
l
Av
e
r
a
g
e
Single Family 700 600 500 400 400 300 300 3,200 457
Multi-Family For "Sale 1,300 1,200 1,000 800 600 500 400 5,800 829
Multi-Family Rental 300 400 300 300 300 300 300 2,200 314
Total Multi-Famiily 1,600 1,600 1,300 1,100 900 800 700 8,000 1,143
Total 2,300 2,200 1,800 1,500 1,300 1,100 1,000 11,200 1,600
% Multi-Family 70%73%72%73%69%73%70%71%71%
Residential Development Projectons
Otay Water District Service Area
Fiscal Years 2018-2025
Page 80 of 91
In the projections, we have placed a heavier weight on the multi-family market, for
two reasons: first, apartment developers have a growing appetite for Otay Ranch
product and second, townhomes will prove to be the most affordable sale product
on the Ranch and therefore most popular with young families.
The land prices in the OWD service area and government fees are most often
substantially less than in the more urban areas of the County, making it highly
attractive to multi-family developers.
We also recognize that the ebullience of the economy may fade somewhat in a few
years and interest rates may climb. Either of those events would soften the market
for sale product but perhaps not for rental product.
8.2 Non-Residential Product
Projecting non-residential development in the OWD service area is not as precise
as the residential sector, as it remains largely untested for most product.
For instance, the Chesnut office development, which could have as much as
1,000,000 square feet of office space, is not assured of near-term development. We
have placed the start of that development in 2022-2023, hedging our bet. It could
happen earlier.
We have allocated a modest amount of office space in earlier years to reflect the
possibility of smaller office space within the new villages, some of which may be
health related.
We have not assumed that University Village will move forward in this timeframe,
although that might change if the proposed St. Katherine’s University moves
forward with its plan.
The probability of a number of smaller hotels is somewhat certain and most likely,
the CBX may initiate hotel development in the near-term future.
We, of course, have not included the RIDA Hotel and Conference Center in
Bayfront as it is not in the OWD service area, although most certainly will happen in
the next few years.
Retail will be developed in the villages as they mature, but it will be neighborhood
shopping, with the exception of the Sudberry 135,000 square feet of space that is
underway in Millenia.
Page 81 of 91
Until recently, the vacancy rate in industrial space on the Otay Mesa was 15%+
and has now edged down to the 10% range. Most of the development there is large
one-story boxes that, in some cases, have been segmented into smaller incubator
spaces.
The major developer in Otay Mesa is the Murphy Company which has dominated
the market there for several decades and continues to control most of the remaining
industrially zoned land.
The company tends to build in 100,000+ square foot increments, often speculative.
They have also acquired the former Sanyo space that will be retrofitted for smaller
users.
We don’t mean to imply that the Murphy Company owns all the industrial space in
Otay Mesa, but it does control most of the space that is most likely to be developed
in the near-term future.
Certainly, the land along S-11 will ultimately be developed with industrial, but we do
not foresee that in the near-term future.
8.2
Fiscal Years:Measure 20
1
8
-
2
0
1
9
20
1
9
-
2
0
2
0
20
2
0
-
-
2
0
2
1
20
2
1
-
2
0
2
2
20
2
2
-
2
0
2
3
20
2
3
-
2
0
2
4
20
2
4
-
2
0
2
5
Total
Hotels (2)Rooms 478 150 100 100 828
Industrial (1)Sq.Ft.300,000 300,000 300,000 300,000 300,000 300,000 300,000 2,100,000
Retail Sq.Ft.165,000 20,272 15,000 20,000 20,000 20,000 20,000 280,272
Office Sq.Ft.- - 10,000 10,000 10,000 150,000 150,000 330,000
(1) excludes renovation of Sanyo space.
(2) excludes the 1,600 room RIDA Hotel and Conference Center which is not in the OWD service area.
Non-Residential Development Projectons
Otay Water District Service Area
Fiscal Years 2018-2025
Page 82 of 91
<<<<<<<<<<<<<<<<<<>>>>>>>>>>>>>>>>
On balance, we are convinced that the next several years will be highly active ones
for the residential and commercial development community in the Otay Ranch/Otay
Mesa region. As a result, the Otay Water District will experience a substantial
increase in customers and usage.
Year Office Retail Industrial Hotel Total
Annual Average
CY 2002-2007 208.0$ 141.1$ 136.4$ 78.2$ 563.7$
CY 2012-2015 159.4$ 122.4$ 32.5$ 70.7$ 385.0$
FY 2015-2018 120.0$ 105.0$ 43.3$ 63.3$ 331.6$
FY 2018-2024 130.0$ 125.0$ 75.0$ 90.0$ 420.0$
Annual Average
FY 2015-2018 4.0$ 4.0$ 2.0$ 3.5$ 13.5$
+25% Misc.1.0$ 1.0$ 0.5$ 0.9$ 3.4$
Total 5.0$ 5.0$ 2.5$ 4.4$ 16.9$
FY 2018-2024 5.0$ 5.0$ 3.0$ 4.5$ 17.5$
+25% Misc.1.3$ 1.3$ 0.8$ 1.1$ 4.4$
Total 6.3$ 6.3$ 3.8$ 5.6$ 21.9$
FY 2015-2018 4.2%4.8%5.8%6.9%5.1%
FY 2018-2024 4.8%5.0%5.0%6.3%5.2%
Note: Remodeling projects and publicly funded projects excluded
OWD as % of San Diego County
Non-Residential Permit Valuations (Historic and Projected)
Otay Water District and San Diego County
2002-2024 (P)
Annual Average ($millions)
San Diego County
OWD Service Area
Page 83 of 91
Detail Exhibits
Projected Development Activity
Otay Ranch 2018-2025
Page 84 of 91
VILLAGE 2
Community Builder Type 2018 2019 2020 2021 2022 2023 2024 2025 Total
Apartments Baldwin MF - Apt 300 425 330 0 0 0 0 0 1,055
R-28 MF R&V Management MF - Apt 0 0 0 0 0 0 0 0 -
Signature Baldwin/Heritage MF - Sale 37 42 0 0 0 0 0 0 79
Suwerte Baldwin/Heritage MF - Sale 0 50 50 50 50 50 42 0 292
Lovina Baldwin/Heritage MF - Sale 66 12 0 0 0 0 0 0 78
SF Baldwin SF 156 135 40 27 0 0 0 0 358
Aventine Cornerstone SF 26 25 25 24 0 0 0 0 100
Cambria Cornerstone SF 10 25 25 0 0 0 0 0 60
Estancia Cornerstone SF 27 0 0 0 0 0 0 0 27
Monterra Cornerstone SF 1 35 0 0 0 0 0 0 36
Total 623 749 470 101 50 50 42 0 2,085
MF - Total 403 529 380 50 50 50 42 0 1,504
MF - For Sale 103 104 50 50 50 50 42 0 449
MF - Rental 300 425 330 0 0 0 0 0 1,055
SF 220 220 90 51 0 0 0 0 581
Source: BIA, land owners, builders & City of Chula Vista
TOTAL
Projected Development Activity
Village 2
2018-2025
Otay Ranch
PA 12
Community Builder Type 2018 2019 2020 2021 2022 2023 2024 2025 Total
Apartments Baldwin MF - Apt 213 351 0 0 0 0 0 0 564
MF - Sale
Product Baldwin MF - Sale 40 64 52 32 0 0 0 0 188
SF Baldwin SF 39 38 0 0 0 0 0 0 77
Total 292 453 52 32 0 0 0 0 829
MF - Total 253 415 52 32 0 0 0 0 752
MF - For Sale 40 64 52 32 0 0 0 0 188
MF - Rental 213 351 0 0 0 0 0 0 564
SF 39 38 0 0 0 0 0 0 77
Source: BIA, land owners, builders & City of Chula Vista
Projected Development Activity
PA 12
2018-2025
Otay Ranch
Page 85 of 91
Escaya (Village 3)
Community Builder Type 2018 2019 2020 2021 2022 2023 2024 2025 Total
Alley Row TH Brookfield Homes MF Sale 58 21 0 0 0 0 0 0 79
Mixed Use Project
(Apts./Commercial)HomeFed MF - Apt 150 246 0 0 0 0 0 0 396
Haciendas Brookfield Homes SF 38 12 0 0 0 0 0 0 50
Prado Front Load SFD Brookfield Homes SF 44 42 18 0 0 0 0 0 104
Castellena CalAtlantic Homes SF 48 29 0 0 0 0 0 0 77
Indigo CalAtlantic Homes SF 59 52 0 0 0 0 0 0 111
Valencia CalAtlantic Homes SF 50 68 0 0 0 0 0 0 118
Strata Shea Homes SF 50 22 0 0 0 0 0 0 72
Sierra Shea Homes SF 57 65 12 0 0 0 0 0 134
Seville Shea Homes SF 52 43 40 0 0 0 0 0 135
Total 946 600 70 0 0 0 0 0 1,616
MF - Total 548 267 0 0 0 0 0 0 815
MF - For Sale 398 21 0 0 0 0 0 0 419
MF - Rental 150 246 0 0 0 0 0 0 396
SF 398 333 70 0 0 0 0 0 801
Source: BIA, land owners, builders & City of Chula Vista
TOTAL
Projected Development Activity
Village 3 (Escaya) - Home Fed
Otay Ranch
2018-2025
Page 86 of 91
Millenia
Community Builder Type 2018 2019 2020 2021 2022 2023 2024 2025 Total
Cal Atlantic Lot 17
CalAtlantic
Homes MF - For Sale 40 38 0 0 0 0 0 0 78
Skylar KB Homes MF - For Sale 52 16 0 0 0 0 0 0 68
Evo/Trio /Metro
Meridian
Development MF - For Sale 106 105 0 0 0 0 0 0 211
Lot 19 Chesnut MF - For Sale 0 0 150 0 0 0 0 150
Lot 13
Meridian
Development MF - For Sale 0 60 0 0 0 0 0 0 60
Lot 19 & 22
Meridian
Development MF - For Sale 10 116 0 0 0 0 0 0 126
Element & Z Shea Homes MF - For Sale 41 34 0 0 0 0 0 0 75
Main St Apartments
Meridian
Development MF - Rental 0 300 0 0 0 0 0 0 300
Main Street Residential n/a MF - Rental 44 100 0 0 0 0 0 144
Alexan Apartments
Trammell
Crow MF - Rental 0 309 0 0 0 0 0 0 309
Trammell Crow Lot 28
Trammell
Crow MF - Rental 253 0 0 0 0 0 0 0 253
Revel Senior n/a MF - Rental 0 0 159 0 0 0 0 0 159
TOTAL Total 1,004 1022 259 150 0 0 0 0 2,435
MF - Total 502 1022 259 150 0 0 0 0 1,933
MF - For Sale 249 369 0 150 0 0 0 0 768
MF - Rental 253 653 259 - - - - 0 1,165
SF 0 0 0 0 0 0 0 0 -
Ayers Hotel (rooms)Ayers 135 135
Sudberry Commercial
(Sq.Ft.)Sudberry 135,000 135,000
Future Office (Sq.Ft.)
Lot 7 Chesnut 330,000 330,000
Lot 1 Chesnut 400,000 400,000
Lot 19 Chesnut 400,000 400,000
Source: BIA, land owners, builders & City of Chula Vista
Projected Development Activity
Millenia
Otay Ranch
2018-2025
Page 87 of 91
Village 4
Community Builder Type 2018 2019 2020 2021 2022 2023 2024 2025 Total
SF Moeller SF 0 0 15 39 19 0 0 0 73
MF Moeller MF 0 0 20 129 128 0 0 0 277
Total 0 0 50 207 166 0 0 0 423
MF - Total 0 0 35 168 147 0 0 0 350
MF - For Sale 0 0 20 129 128 0 0 0 277
MF - Rental 0 0 0 0 0 0 0 0 0
SF 0 0 15 39 19 0 0 0 73
Source: BIA, land owners, builders & City of Chula Vista
Projected Development Activity
Village 4
Otay Ranch
2018-2025
Community Builder Type 2018 2019 2020 2021 2022 2023 2024 2025 Total
SF HomeFed SF 0 263 50 232 232 67 0 0 844
MF HomeFed MF 0 468 742 180 67 57 0 0 1,514
Total 0 731 792 412 299 124 0 0 2,358
MF - Total 0 468 742 180 67 57 0 0 1,514
MF - For Sale 0 468 442 180 67 57 0 0 1,214
MF - Rental 0 0 300 0 0 0 0 0 300
SF 0 263 50 232 232 67 0 0 844
Source: BIA, land owners, builders & City of Chula Vista
Projected Development Activity
Villages 8,9,10 (Home Fed)
Otay Ranch
2017-2024
Villages 8,9,10
Page 88 of 91
Community Builder Type 2018 2019 2020 2021 2022 2023 2024 2025 Total
MF Moeller MF 0 0 0 57 0 0 0 0 57
SF Moeller SF 0 0 0 50 50 50 50 50 250
0 0 0 107 50 50 50 50 257
Total 0 0 0 107 50 50 50 50 307
MF - Total 0 0 0 57 0 0 0 0 57
MF - For Sale 0 0 0 57 0 0 0 0 57
MF - Rental 0 0 0 0 0 0 0 0 0
SF 0 0 0 50 50 50 50 50 250
Source: BIA, Hunsaker Assoc., land owners, builders & City of Chula Vista
Total
Projected Development Activity
Village 13 (Unincorporated San Diego County)
Otay Ranch
2018-2025
Villages 13
MF
Jackson
Pendo MF 0 0 0 0 0 0 0 0 0 -
SF
Jackson
Pendo SF 0 0 0 0 50 50 50 50 0 200
Total 0 0 0 0 50 50 50 50 0 200
MF - Total 0 0 0 0 0 0 0 0 0 0
MF - For
Sale 0 0 0 0 0 0 0 0 0 0
MF - Rental 0 0 0 0 0 0 0 0 0 0
SF 0 0 0 0 50 50 50 50 0 200
Source: BIA, Hunsaker Assoc., land owners, builders & City of Chula Vista
Village 14 (South, Central and North)
Projected Development Activity
(Unincorporated San Diego County)
Otay Ranch
2017-2024
Villages 14
Page 89 of 91
Community Builder Type 2018 2019 2020 2021 2022 2023 2024 2025 Total
MF
Jackson
Pendo MF 0 0 0 0 0 0 0 0 -
SF
Jackson
Pendo SF 0 0 0 25 25 25 50 0 125
Total 0 0 0 25 25 25 50 0 125
MF - Total 0 0 0 0 0 0 0 0 0
MF - For Sale 0 0 0 0 0 0 0 0 0
MF - Rental 0 0 0 0 0 0 0 0 0
SF 0 0 0 25 25 25 50 0 125
Source: BIA, Hunsaker Assoc., land owners, builders & City of Chula Vista
Projected Development Activity
Planning Areas 16 & 19
(Unincorporated San Diego County)
Otay Ranch
2018-2025
Villages16 & 19
Page 90 of 91
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Disclaimer
Although the results, conclusions and recommendations contained within this consultant’s report are based
upon a thorough review and analysis of current competitive market conditions and the expertise of the author,
Consultant does not in any way represent, warrant or guarantee that any reported results will be achieved as a
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AS7 Law San Diego/004344/000002/ME/S0429161.DOCX
TO: The Otay Water District Board of Directors,
General Manager Mark Watton
FROM: Jeanne Blumenfeld, Esq.
RE:
Increasing the Board of Directors Per Diem Compensation and Proposed
Changes to the Board of Directors Policy 8, Directors Per Diem Compensation
and Directors’ Responsibility for Expenses.
DATE: March 29, 2019
PURPOSE
Policy 8 provides for Board members to be compensated for each day of attendance at
meetings of the Board or for each day of service rendered as a Director by request or authorization
of the Board. California Water Code sections 20200 et seq. authorize the Board of Directors, by
Ordinance, to increase the amount of per diem compensation they receive for performing approved
duties. If the per diem compensation is increased, Policy 8 will also need to be amended to reflect
the change.
The purpose of the proposed amendments outlined in this report is to update Board of
Directors Policy 8 to increase the compensation to be paid to members of the Board of Directors
for each day of service as a Director, and to specify that expenses incurred by spouses, family
members, or guests are the responsibility of the Director in accordance with District practice and
the law, as described in greater detail below.
PROPOSED CHANGES TO POLICY NO. 8
1. Increasing Compensation to be Paid to Members of the Board of Directors
Board Policy 8 Section A. Directors’ Per Diem provides, in pertinent part, that the members
of the Board of Directors receive per diem compensation “in the amount of $145 for each day of
attendance at meetings of the Board or for each day of service rendered as a Director by request or
authorization of the Board, not to exceed a total of ten (10) days in any calendar month.”
Water Code Section 20201 provides that the Board may provide compensation to members
of the Board of Directors “in an amount not to exceed … $100”. Section 20202 authorizes the
Board to increase the amount of compensation above the amount of $100 per day, but provides
Proposed Changes to Policy No. 8 March 29, 2019
Page 2
AS7 Law San Diego/004344/000002/ME/S0429161.DOCX
that “the increase may not exceed an amount equal to 5 percent, for each calendar year following
the operative date of the last adjustment ...” Procedurally any increase must be by Ordinance after
a properly noticed public hearing (Water Code Section 20203). The public hearing must be noticed
pursuant to Section 6066 of the Government Code, which requires publication of notice of the
proposed Ordinance “once a week for two successive weeks.” Section 6066 provides further that
“[t]wo publications in a newspaper published once a week or oftener, with at least five days
intervening between the respective publication dates not counting such publication dates, are
sufficient. The period of notice commences upon the first day of publication and terminates at the
end of the fourteenth day, including therein the first day.” Section 20204 of the Water Code
provides that the ordinance increasing compensation to be paid board members shall become
effective sixty (60) days from the date of its final passage.
The District has complied with the notice publication requirements by publishing a Notice
of Public Hearing in the “Legal Advertisements” section in the San Diego Union-Tribune on
Tuesday, March 19, and March 26.
Accordingly, coupling the aforementioned legal authorities with the District Policy, the
Board is legally authorized to increase by Ordinance, the current compensation of $145 for each
day of attendance at meetings of the Board or for each day of service rendered as a Director by
request or authorization of the Board, to no more than $152.25 per day, and not to exceed 10
days per month.
2. Reimbursement for Expenses Incurred by Spouses, Family Members or Guests.
Policy 8, Section C provides that Directors will be reimbursed for expenses incurred in the
performance of their duties. Section C 6 provides for expenses that will not be reimbursed because
they are the Directors’ responsibility. Currently, Policy 8 subsection C.6.d permits a Director to
be reimbursed for expenses incurred by his/her spouse, family members, or guests “where the
District purchases a table at an event”. For some time, District practice has disallowed
reimbursement to Directors for expenses incurred by his/her spouse, family members, or guests in
all circumstances including events for which the District purchases a table. The law supports
current District practice because such reimbursement would be a gift of public funds and the
reimbursement is a gift and therefore reportable pursuant to the Political Reform Act.
As public officials, members of the board are subject to the Political Reform Act (Gov.
Code sections 8100 et seq.) The Political Reform Act prohibits board members from accepting
gifts from any single source, including the District, in any calendar with a total value of more than
two hundred fifty dollars ($250). Gov. Code section 89503. The Political Reform Act defines a
"gift," in part, as "any payment that confers a personal benefit on the recipient, to the extent that
consideration of equal or greater value is not received... Any person … who claims that a payment
is not a gift by reason of receipt of consideration has the burden of proving that consideration
received is of equal or greater" value than the personal benefit received.
Proposed Changes to Policy No. 8 March 29, 2019
Page 3
AS7 Law San Diego/004344/000002/ME/S0429161.DOCX
In addition, The California Constitution prohibits public agencies, including the District,
from the giving or lending public funds to any person or entity, public or private. (Const., Art.
XVI, § 6.) Public funds are identified as any monies that are collected and retained in a District
account. “Due to their unique operating environment, governments have a responsibility to be
accountable for the use of resources that differs significantly from that of business enterprises.
Although businesses receive revenues from a voluntary exchange between a willing buyer and
seller, most governments obtain resources primarily from the involuntary payment of taxes.”
(GASB White Paper: Why Governmental Accounting and Financial Reporting Is – And Should
Be – Different (April 2013).) The prohibition against gifts of public funds ensures accountability
to constituents and prevents misuse of public money. Under this constitutional prohibition, the
Legislature is also precluded from authorizing the making of a gift of public money to any
individual. (Const., Art. XVI, § 6.) Courts have interpreted Article XVI, § 6 to include all payments
of public money for which there is no authority or enforceable claim, even if there is a moral or
equitable obligation.
An expenditure is not a “gift” within the meaning of the constitutional prohibition if the
District receives adequate consideration in exchange for the funds expended. Consideration is a
benefit or something of value commensurate with the amount of the payment. In determining
whether an expenditure is considered a “gift” within the meaning of the gift clause, the primary
question is whether the funds are used for a public or private purpose. If the expenditure is
primarily for a public purpose, it will generally not be a gift. (California Emp. Etc. Com v. Payne
(1947) 31 Cal.2d 210, 216.) If the expenditure is for a private purpose, however, such as for the
benefit of a Director and his/her family member, it will be an unlawful gift of public funds. (City
of Oakland v. Garrison (1924) 194 Cal. 298.)
The use of public funds to reimburse expenses incurred by a board member’s spouse,
including payment for a seat at an event, would constitute a gift of public funds and it would
constitute a “gift” under the Political Reform Act because there is no direct and substantial public
purpose in paying for the expenses of the board member’s spouse, family member or guest. This
is so even if the District purchases a table at an event. This does not mean spouses, family members
or guests cannot attend events for which board members are reimbursed, it just means that
Directors must be responsible for their expenses, even where the District purchases a table at an
event.
3. Policy Corrections Necessary to Conform with the Law
a. If the Board adopts Ordinance 573 and increases the Directors’ per diem compensation
pursuant to California Water Code section 20200 et seq., Policy 8, Section A. Directors’
Per Diem must also be amended to reflect the amount of the increased per diem
compensation.
Proposed Changes to Policy No. 8 March 29, 2019
Page 4
AS7 Law San Diego/004344/000002/ME/S0429161.DOCX
b. The following edit is proposed in order to be in conformance with the California
Constitution and the Political Reform Act (“Act”): the removal of the first phrase in
Section C.6.d., as shown on Attachment 1.
The proposed corrections are shown on the document titled “Policy No. 8 Strike-through”,
which is attached to this Report. The Board can adopt the proposed corrections by Resolution.
Attachments:
Attachment 1. Policy No. 8 Strike-through
Attachment 2. Policy No. 8 Final
Attachment 3. Ordinance No. 573
Attachment 4. Resolution 4361
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 3-6-
194/3/19
Page 1 of 7
Purpose
To provide guidelines for payment of compensation and reimbursement of
expenses to Directors in connection with their attendance at meetings
or the performance of other authorized business, and for group insurance
benefits for Directors.
Background
Members of the Board of Directors (“Directors”) attend regular, adjourned
or special meetings of the Board of Directors (“Board”). In addition,
Directors attend other District meetings, committee meetings,
association meetings, and educational seminars on behalf of the District.
These meetings and seminars are related to District business, water and
water related issues, and California special districts. State statutes
authorize District payments for meetings, reimbursements of expenses.
State law also authorizes the District to provide health and welfare
benefits for active Directors and, in limited circumstances, retired
Directors if they served 12 years and were first elected prior to January
1, 1995. The District is also authorized to offer health and welfare
benefits for retired Directors who commenced office on or after January
1, 1995, if the recipient participates on a self-pay basis.
Policy
The District will compensate Directors on a per diem basis for attendance
at authorized meetings or functions and will reimburse Directors for
reasonable expenses incurred while traveling on District business to
include, lodging, dining, transportation and related incidentals.
A. Directors’ Per Diem
As provided in Section 1.01 C. of the District Code of Ordinances,
each Director shall receive a per diem in the amount of $145152
(effective July 1, 20198) for each day of attendance at meetings
of the Board or for each day of service rendered as a Director by
request or authorization of the Board, not to exceed a total of
ten (10) days in any calendar month. Attendance at any meeting
shown on Exhibit A to this Policy shall be deemed a meeting
requested or authorized by the Board. Attendance of meetings shall
be in accordance with Exhibit A. The President of the Board or the
Board may authorize a Director to attend meetings not listed in
Exhibit A when the President or the Board determine that it is in
the interest of the District that a Director attend, and that such
attendance be compensated and expenses reimbursed. Director’s
claims for per diem amounts shall be made on a “Board of Directors
Per Diem and Mileage Claim Form” (Exhibit B). The President of the
Board or the Board may approve reimbursement of expenses outside
the per diem limit for a Director, if the Director submits receipts
for all of the related District business expenses.
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 3/6-
194/3/19
Page 2 of 7
Attendance at a meeting that is not authorized by this policy (pre-
approved meetings) or pre-approved by the President may be approved
by the Board for per diem compensation. Director’s seeking per
diem compensation for these meetings shall request that the item
be presented to the Board at its next regularly scheduled meeting
for consideration. The decision of the Board shall be final.
When travel arrangements require a day earlier arrival or a day
later departure, Directors will be eligible for the $145 152 per
diem and reasonable expenses associated with the extended stay will
be reimbursed as specified below.
B. Pre-payment of Otherwise Reimbursable Expenses
The Director may request pre-payment of registration,
transportation, and lodging, using the “Board of Directors Travel
Request Form” (Exhibit C). Pre-payments shall be limited to the
Director’s expenses only. No advances shall be made on travel
expenses.
C. Reimbursement of Expenses
Each Director shall be reimbursed for travel expenses to and from
the meetings described in Exhibit A or for any other authorized
District business as follows:
1. Authorization
Travel associated with the attendance of meetings or
functions for Directors shall be approved in advance by the
Otay Water District Board President. To request approval of
travel, the Director should complete a “Board of Directors
Travel Request Form” (Exhibit B) in order to be eligible for
compensation and/or reimbursement. Travel requests will be
reviewed and approved by the Board President or the Board.
2. Transportation
a. Air Transportation
The District will endeavor to purchase airline tickets
in advance taking advantage of discounts and low
airfares.
b. Automobile
1. Personal Auto: Directors may use their personal
vehicle. The District will reimburse Directors at
the current rate/mile as established by the IRS,
plus tolls, parking, etc., provided, however, if
air transportation is available, the total amount
of expense paid shall be limited to the cost of
coach air travel between points traveled by
personal vehicle. Gasoline, collision and
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 3/6-
194/3/19
Page 3 of 7
liability insurance, and maintenance will be
provided by the Director and is deemed covered in
the rate/mileage reimbursement.
Directors using personal vehicles on District
business must maintain a valid California driver’s
license and the automobile insurance coverage
required by the State of California, or make
arrangements for a driver who meets the above
requirements.
2. Rental Cars: The District will provide a rental
car when needed. Such rental car shall be a
compact or mid-size class, unless upgrades are
offered at no additional cost to the District.
c. Miscellaneous Transportation
Whenever practicable, bus, taxi, rail, shuttle, etc.
transportation may be used in lieu of, or in conjunction
with, modes above.
3. Meals and Lodging
a. Meals and Beverages
Whenever travel requires meals, the meals, excluding
gratuity, shall be reimbursable, provided the Director
presents a receipt along with the “Board of Directors
Expense Claim Form” (Exhibit D) for all meals.
Reimbursements for expense items where a receipt has
been lost will not be paid until the President or the
Board has reviewed and approved the expense item. Meals
are reimbursable based on the Meals and Incidental
Expenses (M&IE) as updated by the U.S. General Services
Administration:
1. Full Day Reimbursement
When a Director is traveling for a full day and no
meals are provided for by other sources, such as
pre-paid registration, the Director may be
reimbursed for meal expenses at the rate provided
by the M&IE per day. This amount is exclusive of
any gratuities.
2. Single Meal Reimbursement
When a Director requires reimbursement for a
single meal while traveling, the maximum meal
reimbursement amount shall be at a rate provided
by the M&IE for Breakfast, lunch, and/or dinner,
or amounts determined by the President or the Board
to be reasonable for the occasion or
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 3/6-
194/3/19
Page 4 of 7
circumstances. These amounts and any amount
approved by the President or Board shall exclude
gratuities.
3. Partial Day Reimbursement
When a director will be traveling for a partial day
or where a single meal is provided for by other
sources such as pre-paid registration, the maximum
reimbursement amount shall be at the rate provided
by the M&IE per meal, or such other amounts as may
be determined by the President or the Board to be
reasonable for the occasion or circumstances. In
any event all amounts to be reimbursed shall exclude
any gratuities.
4. Taxes
The maximum meal reimbursement amounts are
inclusive of and assume expenses for taxes. The
maximum meal reimbursements shall exclude any and
all gratuities.
b. Lodging
The District will reimburse Directors or pre-pay
accommodations in single rooms at conference facilities
or in close proximity when applicable. Or, in the
absence of conference accommodations, normal single-
room business, government or commercial class
accommodation may be obtained. Under normal
circumstances, lodging will not be reimbursed for the
night before a conference starts and the night after it
ends. However, in situations where available travel
schedules would require the Director to leave home
before 6:00 AM or return to home after 12:00 AM, lodging
for the night before or the night after will be
reimbursable.
4. Entertainment
The District shall not cover any expenses incurred for
recreation or entertainment.
5. Incidental Expenses
Unavoidable, necessary and reasonable authorized expenses
will be fully reimbursed by the District. Some examples of
allowable expenses are:
a. Reasonable transportation to local restaurants and to
optional functions that are a part of conference events.
b. Parking fees.
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 3/6-
194/3/19
Page 5 of 7
c. The following expenses are not reimbursable:
1. Alcoholic beverages
2. Parking or traffic violations
3. In-room movies or laundry services
6. Director's Responsibility
a. Directors must submit a detailed “Board of Directors
Expense Claim Form” for reimbursement. Claim forms
should be supported by vouchers and itemized receipts
of expenditures for which reimbursement is being
requested. Receipts must be attached for all expenses.
If a receipt is lost, the lost receipt must be noted on
the “Board of Directors Expense Claim Form” (Exhibit D)
and approved by the President or the Board before any
payment can be made. Claim forms shall be submitted
within 45 calendar days after the expense was incurred.
Expense claims requiring reimbursement to the District,
which are not reconciled within 45 calendar days, shall
be deducted from the next month’s reimbursement.
b. Expenses will not be reimbursed for meetings that have
been pre-paid and not attended. The President or the
Board may excuse an absence for a meeting. The absent
Director shall provide a verbal or written report at
the next regularly scheduled Board meeting stating the
reason for the absence and, if appropriate, request that
it be excused. Directors will be required to reimburse
the District for any pre-paid expenses for any unexcused
absence. This reimbursement will be made by deduction
from future expenditures.
c. When two (2) or more Directors combine an expense on
one receipt, the Director requesting reimbursement
should indicate, on or attached to the Director’s “Board
of Directors Expense Claim Form” the identity of the
other persons sharing expenses. This will facilitate
appropriate allocation of expenses to each participant.
d. Except where the District sponsors a table at an event,
expenses incurred by spouses, family members, or guests
are the responsibility of the Director.
e. The District shall, at least annually, provide a report to
disclose any reimbursement paid by the District within the
immediately preceding fiscal year of at least $100 for each
individual charge for services or product received.
“Individual charge” (as defined in California Government
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 3/6-
194/3/19
Page 6 of 7
Code Section 53065.5) includes, but is not limited to, one
meal, lodging for one day, transportation, or a
registration fee.
D. District Group Insurance Benefits
1. Each Director, while serving as a member of the Board of
Directors, shall be entitled to the health and welfare and
life insurance benefits set forth in the Schedule of Benefits
in the District Group Insurance Plan Booklet, which benefits
are furnished by the District at District cost, with
applicable contributions, for active District employees and
Directors. Each active Director shall also be entitled to a
$65,000 term life and accidental death and dismemberment
insurance policy (subject to policy requirements and any
standard age reduction schedule), a $100,000 travel
accidental death and dismemberment policy. In addition to the
foregoing, the District will pay premiums for additional
individual life insurance coverage in an amount of up to
$250,000 for a 20 year term for those active Directors who
apply for such coverage with the District’s provider and meet
the provider’s standard underwriting guidelines and policy
requirements. If coverage at higher amounts or for a longer
term is made available by the provider, each Director may
purchase such additional coverage on a self-pay basis.
2. Each former member of the Board of Directors, who served in
office after January 1, 1981, who was elected to a term of
office that began before January 1, 1995, who is at least
60 years of age, and whose total service at the time of
termination is not less than 12 years, shall be entitled to
the health and welfare and life insurance benefits set
forth in the District Group Insurance Plan Booklet, which
benefits are furnished by the District, at District cost,
for retired Directors.
E.Miscellaneous
Cell Phone expenses are not considered a reimbuseable expense
Attachments
Exhibit A: Approved Function List
Exhibit B: “Board of Directors Per Diem and Mileage Claim Form”
Exhibit C: “Board of Directors Travel Request Form”
Exhibit D: “Board of Directors Expense Claim Form”
EXHIBIT A
Approved Functions List
Board Policy for payment of per diem compensation and expenses for
Director attendance at District meetings:
The Board reviews its authorization and policy for payment of per
diem compensation forpre-approved meetings annually, in January
following reorganization of the Board and election of a new
President. Below is the current Board policy:
1. The following meetings are pre-approved for all Directors
to attend and receive per diem compensation and expense
reimbursement:
Otay Water District Regular and Special Board Meetings
Otay committee meetings for committee members only
Otay business meetings called by the General Manager
and authorized by the President of the Board where
individual Directors are requested to attend
Except as otherwise specifically excluded in this
policy, official District functions that take place
during normal business hours where Directors are
requested to attend by either the Board President or
the Board
Semi-annual conference of the Association of California
Water Agencies
Regular quarterly meetings of the Water Agencies
Association of San Diego County
Regularly monthly meeting of Council of Water Utilities
Business meetings and conferences of the California
Special District Association held in San Diego County
All other meetings not listed here require pre-
approval by the President or Board for Directors to
receive per diem compensation and/or expense
reimbursement.
2. The following meetings are pre-approved for designated Otay
Director representatives or designated alternate. The
District Secretary will maintain an updated list of
designated Director representatives. Any other Director who
wishes to attend these meetings and receive a per diem must
have approval from the President or Board prior to the event
or be designated by the President or Board, as an alternate.
The pre-approval shall include the attendance of the
Director at the commission, committee, board or meeting and
any committee, subcommittee or other official or posted
EXHIBIT A
meeting of the agencies, commissions, committees or boards
listed below:
Planning Group and City Commission meetings that fall
within the boundaries of each directors district (when
issues impacting OWD are discussed)
Inter-Agency Committee Meeting
METRO (TAC/AFFORD) Commission
ACWA or CSDA meetings/conferences
Water Conservation Garden
WateReuse Association
South County Economic Development Council
3. The Board President or his designee is pre-authorized to
attend District business meetings with cities and other
agencies to represent Otay Water District, and may claim a
per diem and expenses. Any other Director desiring to attend
the same meeting of this nature would require approval to
attend from the President or the Board in order to receive
a per diem and expense reimbursement.
4. When the President or the Board appoints a director(s) to a
committee, the meeting(s) shall be considered pre-approved
for per diem and expense reimbursement.
5. The following meeting requires pre-approval by the Board
President or Board of Directors to receive per diem and
expense reimbursement:
Regional and/or local Chamber of Commerce business or
board meetings where the District maintains a membership
6. The following meetings are not eligible for pre-approved per
diem claims:
a) Attending other Districts’ Board meetings
b) Otay employee appreciation breakfast, luncheons or
dinners
c) Retirement receptions
d) Otay picnics or dinner-dances or other purely social
events
e) If a per diem reimbursement is provided by another
agency (i.e. San Diego County Water Authority and the
Metro Commission)
f) First Friday Breakfasts unless presenting Otay official
business to the assembly
g) Any political campaign event or function
7. In order to submit a per diem/travel reimbursement the
member must attend at least 50% of the meeting (per day)
and the reimbursement request must be submitted within 45
days of the occurrence, otherwise it may be considered
EXHIBIT A
attended without per diem. The President of the Board will
make the final determination.
8. All other meetings/conferences/tours/seminars/
workshops/functions not listed in this policy must be pre-
approved by the Board President or the Board.
EXHIBIT B
(Director’s Signature)
GM Receipt: Date:
FOR OFFICE USE: TOTAL MILEAGE REIMBURSEMENT: $
OTAY WATER DISTRICT
BOARD OF DIRECTORS
PER-DIEM AND MILEAGE CLAIM FORM
Pay To: Period Covered:
Employee Number: From: To:
ITEM DATE MEETING PURPOSE / ISSUES
DISCUSSED
MILEAGE
HOME to OWD OWD to HOME
MILEAGE
OTHER LOCATIONS
Total Meeting Per Diem:
$
($145 per meeting)
Total Mileage Claimed: miles
EXHIBIT B
INSTRUCTIONS ON REVERSE
EXHIBIT B
INSTRUCTIONS FOR PREPARATION OF
BOARD OF DIRECTORS PER DIEM CLAIM FORM
1. Record the date, and name or purpose/issues discussed of meeting
attended on behalf of the District.
Note: The District will pay Director's per-diem for one meeting/
function per day and the maximum of 10 meetings/functions per month.
If a Director attends more than 10 meetings/functions (10 days), the
District will reimburse for the mileage and any reimbursable out-of-
pocket expenses incurred for these additional meetings.
2. Record number of miles (round trip) driven to attend meeting/ function.
The use of personal vehicles in the conduct of official District business
shall be reimbursed at the current Internal Revenue Service rate. The
Director's expense claim should indicate the nature of the trip. If a trip
begins at home, the District will reimburse the mileage from home to
destination and return mileage. District insurance does not cover personal
vehicles while they are being driven on District business. The reimbursement
rate is inclusive of an allowance for insurance costs. The District will
reimburse Directors for the deductible under their personal insurance policy
should they be involved in an accident while on District business. To be
eligible for reimbursement, each Director shall maintain a current California
driver’s license and at least the minimum vehicle liability insurance
required by State law or shall arrange for a driver who meets said standards.
The District will not reimburse the cost of travel of a personal nature taken
in conjunction with travel on official business.
Claim forms shall be submitted within 45 calendar days after the meeting
date. Expense claims requiring reimbursement to the District which are not
reconciled within 45 calendar days, shall be deducted from the next month’s
reimbursement.
No information on the Per Diem Claim Form may be designated as confidential
in nature. All expenses must be fully disclosed on the form.
EXHIBIT C
OTAY WATER DISTRICT
BOARD OF DIRECTORS
TRAVEL REQUEST FORM
Director: Date of Request:
Name and Location of Function:
Date(s) function to be held: -
Sponsoring Organization:
Request for Prepayment of Fees Related to the Function:
Expense Type Not Needed Pre-Payment
Requested
Registration
Airline
Auto Rental
Mileage N/A
Taxi/Shuttle N/A
Lodging
Meals N/A
Other Expenses – Explain Below
Lodging Preference:
Explanation of Other
Expenses:
Signature of Director Date of Request
For Office Use Only Below This Line
Date of Board
Approval:
Expense Type Description Amount Pre-
Paid
Registration
Airline
Auto Rental
Mileage N/A
Taxi/Shuttle N/A
Lodging
Meals N/A
Other Expenses
District Secretary Date Processed
EXHIBIT D
OTAY WATER DISTRICT
BOARD OF DIRECTORS
EXPENSE CLAIM FORM
Pay To: Period Covered:
Employee Number: From: To:
ITEMIZED REIMBURSEMENT CLAIMED
Date
Type of Reimbursement
Amount
TOTAL Reimbursement Claimed: $
Director Signature: Date:
GM Receipt: Date:
INSTRUCTIONS ON REVERSE
EXHIBIT D
INSTRUCTIONS FOR PREPARATION OF
BOARD OF DIRECTORS EXPENSE CLAIM FORM
The necessary expenses incurred while traveling on District business including
common carrier fares (economy class), automobile rental charges, District business
telephone calls, lodging, baggage handling, parking fees, meals, etc. will be
reimbursed when documented on the Director's Per Diem and Expense Claim Forms.
Receipts must be attached for all meal expenses. If a receipt is lost, the lost
receipt should be noted next to the expense and submitted to the President before
any reimbursement can be made. Receipts are required for the reimbursement of all
expenses.
All receipts must have the nature of the expense and the business purpose
noted on the receipt.
The District will not reimburse the cost of travel of a personal nature taken
in conjunction with travel on official business.
Meals shall be reimbursed as per section 3, Meals and Lodging, of this policy
(Policy 8).
Any receipts that include costs of personal travel (e.g., hotel receipt for
employee and spouse) should identify what the cost would have been without
personal travel (e.g., single room rate as opposed to double room rate).
Claim forms shall be submitted within 45 calendar days after the expense was
incurred. Expense claims requiring reimbursement to the District which are
not reconciled within 45 calendar days, shall be deducted from the next month’s
reimbursement.
No information on the Expense Claim Form may be designated as confidential in
nature. All expenses must be fully disclosed on the form.
The following expenses are not reimbursable:
a. Alcoholic Beverages d. Laundry service
b. Parking or traffic violations e. Entertainment or recreation
c. In-room movies f. Expenses incurred by spouses,
family members, or guests.
ND: 4840-9653-1715, v. 2
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 4/3/19
Page 1 of 7
Purpose
To provide guidelines for payment of compensation and reimbursement of
expenses to Directors in connection with their attendance at meetings
or the performance of other authorized business, and for group insurance
benefits for Directors.
Background
Members of the Board of Directors (“Directors”) attend regular, adjourned
or special meetings of the Board of Directors (“Board”). In addition,
Directors attend other District meetings, committee meetings,
association meetings, and educational seminars on behalf of the District.
These meetings and seminars are related to District business, water and
water related issues, and California special districts. State statutes
authorize District payments for meetings, reimbursements of expenses.
State law also authorizes the District to provide health and welfare
benefits for active Directors and, in limited circumstances, retired
Directors if they served 12 years and were first elected prior to January
1, 1995. The District is also authorized to offer health and welfare
benefits for retired Directors who commenced office on or after January
1, 1995, if the recipient participates on a self-pay basis.
Policy
The District will compensate Directors on a per diem basis for attendance
at authorized meetings or functions and will reimburse Directors for
reasonable expenses incurred while traveling on District business to
include, lodging, dining, transportation and related incidentals.
A. Directors’ Per Diem
As provided in Section 1.01 C. of the District Code of Ordinances,
each Director shall receive a per diem in the amount of $152
(effective July 1, 2019) for each day of attendance at meetings of
the Board or for each day of service rendered as a Director by
request or authorization of the Board, not to exceed a total of
ten (10) days in any calendar month. Attendance at any meeting
shown on Exhibit A to this Policy shall be deemed a meeting
requested or authorized by the Board. Attendance of meetings shall
be in accordance with Exhibit A. The President of the Board or the
Board may authorize a Director to attend meetings not listed in
Exhibit A when the President or the Board determine that it is in
the interest of the District that a Director attend, and that such
attendance be compensated and expenses reimbursed. Director’s
claims for per diem amounts shall be made on a “Board of Directors
Per Diem and Mileage Claim Form” (Exhibit B). The President of the
Board or the Board may approve reimbursement of expenses outside
the per diem limit for a Director, if the Director submits receipts
for all of the related District business expenses.
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 4/3/19
Page 2 of 7
Attendance at a meeting that is not authorized by this policy (pre-
approved meetings) or pre-approved by the President may be approved
by the Board for per diem compensation. Director’s seeking per
diem compensation for these meetings shall request that the item
be presented to the Board at its next regularly scheduled meeting
for consideration. The decision of the Board shall be final.
When travel arrangements require a day earlier arrival or a day
later departure, Directors will be eligible for the $152 per diem
and reasonable expenses associated with the extended stay will be
reimbursed as specified below.
B. Pre-payment of Otherwise Reimbursable Expenses
The Director may request pre-payment of registration,
transportation, and lodging, using the “Board of Directors Travel
Request Form” (Exhibit C). Pre-payments shall be limited to the
Director’s expenses only. No advances shall be made on travel
expenses.
C. Reimbursement of Expenses
Each Director shall be reimbursed for travel expenses to and from
the meetings described in Exhibit A or for any other authorized
District business as follows:
1. Authorization
Travel associated with the attendance of meetings or
functions for Directors shall be approved in advance by the
Otay Water District Board President. To request approval of
travel, the Director should complete a “Board of Directors
Travel Request Form” (Exhibit B) in order to be eligible for
compensation and/or reimbursement. Travel requests will be
reviewed and approved by the Board President or the Board.
2. Transportation
a. Air Transportation
The District will endeavor to purchase airline tickets
in advance taking advantage of discounts and low
airfares.
b. Automobile
1. Personal Auto: Directors may use their personal
vehicle. The District will reimburse Directors at
the current rate/mile as established by the IRS,
plus tolls, parking, etc., provided, however, if
air transportation is available, the total amount
of expense paid shall be limited to the cost of
coach air travel between points traveled by
personal vehicle. Gasoline, collision and
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 4/3/19
Page 3 of 7
liability insurance, and maintenance will be
provided by the Director and is deemed covered in
the rate/mileage reimbursement.
Directors using personal vehicles on District
business must maintain a valid California driver’s
license and the automobile insurance coverage
required by the State of California, or make
arrangements for a driver who meets the above
requirements.
2. Rental Cars: The District will provide a rental
car when needed. Such rental car shall be a
compact or mid-size class, unless upgrades are
offered at no additional cost to the District.
c. Miscellaneous Transportation
Whenever practicable, bus, taxi, rail, shuttle, etc.
transportation may be used in lieu of, or in conjunction
with, modes above.
3. Meals and Lodging
a. Meals and Beverages
Whenever travel requires meals, the meals, excluding
gratuity, shall be reimbursable, provided the Director
presents a receipt along with the “Board of Directors
Expense Claim Form” (Exhibit D) for all meals.
Reimbursements for expense items where a receipt has
been lost will not be paid until the President or the
Board has reviewed and approved the expense item. Meals
are reimbursable based on the Meals and Incidental
Expenses (M&IE) as updated by the U.S. General Services
Administration:
1. Full Day Reimbursement
When a Director is traveling for a full day and no
meals are provided for by other sources, such as
pre-paid registration, the Director may be
reimbursed for meal expenses at the rate provided
by the M&IE per day. This amount is exclusive of
any gratuities.
2. Single Meal Reimbursement
When a Director requires reimbursement for a
single meal while traveling, the maximum meal
reimbursement amount shall be at a rate provided
by the M&IE for Breakfast, lunch, and/or dinner,
or amounts determined by the President or the Board
to be reasonable for the occasion or
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 4/3/19
Page 4 of 7
circumstances. These amounts and any amount
approved by the President or Board shall exclude
gratuities.
3. Partial Day Reimbursement
When a director will be traveling for a partial day
or where a single meal is provided for by other
sources such as pre-paid registration, the maximum
reimbursement amount shall be at the rate provided
by the M&IE per meal, or such other amounts as may
be determined by the President or the Board to be
reasonable for the occasion or circumstances. In
any event all amounts to be reimbursed shall exclude
any gratuities.
4. Taxes
The maximum meal reimbursement amounts are
inclusive of and assume expenses for taxes. The
maximum meal reimbursements shall exclude any and
all gratuities.
b. Lodging
The District will reimburse Directors or pre-pay
accommodations in single rooms at conference facilities
or in close proximity when applicable. Or, in the
absence of conference accommodations, normal single-
room business, government or commercial class
accommodation may be obtained. Under normal
circumstances, lodging will not be reimbursed for the
night before a conference starts and the night after it
ends. However, in situations where available travel
schedules would require the Director to leave home
before 6:00 AM or return to home after 12:00 AM, lodging
for the night before or the night after will be
reimbursable.
4. Entertainment
The District shall not cover any expenses incurred for
recreation or entertainment.
5. Incidental Expenses
Unavoidable, necessary and reasonable authorized expenses
will be fully reimbursed by the District. Some examples of
allowable expenses are:
a. Reasonable transportation to local restaurants and to
optional functions that are a part of conference events.
b. Parking fees.
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 4/3/19
Page 5 of 7
c. The following expenses are not reimbursable:
1. Alcoholic beverages
2. Parking or traffic violations
3. In-room movies or laundry services
6. Director's Responsibility
a. Directors must submit a detailed “Board of Directors
Expense Claim Form” for reimbursement. Claim forms
should be supported by vouchers and itemized receipts
of expenditures for which reimbursement is being
requested. Receipts must be attached for all expenses.
If a receipt is lost, the lost receipt must be noted on
the “Board of Directors Expense Claim Form” (Exhibit D)
and approved by the President or the Board before any
payment can be made. Claim forms shall be submitted
within 45 calendar days after the expense was incurred.
Expense claims requiring reimbursement to the District,
which are not reconciled within 45 calendar days, shall
be deducted from the next month’s reimbursement.
b. Expenses will not be reimbursed for meetings that have
been pre-paid and not attended. The President or the
Board may excuse an absence for a meeting. The absent
Director shall provide a verbal or written report at
the next regularly scheduled Board meeting stating the
reason for the absence and, if appropriate, request that
it be excused. Directors will be required to reimburse
the District for any pre-paid expenses for any unexcused
absence. This reimbursement will be made by deduction
from future expenditures.
c. When two (2) or more Directors combine an expense on
one receipt, the Director requesting reimbursement
should indicate, on or attached to the Director’s “Board
of Directors Expense Claim Form” the identity of the
other persons sharing expenses. This will facilitate
appropriate allocation of expenses to each participant.
d. Expenses incurred by spouses, family members, or guests
are the responsibility of the Director.
e. The District shall, at least annually, provide a report to
disclose any reimbursement paid by the District within the
immediately preceding fiscal year of at least $100 for each
individual charge for services or product received.
“Individual charge” (as defined in California Government
Code Section 53065.5) includes, but is not limited to, one
OTAY WATER DISTRICT
BOARD OF DIRECTORS POLICY
Subject Policy
Number
Date
Adopted
Date
Revised
DIRECTORS COMPENSATION, REIMBURSEMENT OF
EXPENSES AND GROUP INSURANCE BENEFITS
08 2/20/91 4/3/19
Page 6 of 7
meal, lodging for one day, transportation, or a
registration fee.
D. District Group Insurance Benefits
1. Each Director, while serving as a member of the Board of
Directors, shall be entitled to the health and welfare and
life insurance benefits set forth in the Schedule of Benefits
in the District Group Insurance Plan Booklet, which benefits
are furnished by the District at District cost, with
applicable contributions, for active District employees and
Directors. Each active Director shall also be entitled to a
$65,000 term life and accidental death and dismemberment
insurance policy (subject to policy requirements and any
standard age reduction schedule), a $100,000 travel
accidental death and dismemberment policy. In addition to the
foregoing, the District will pay premiums for additional
individual life insurance coverage in an amount of up to
$250,000 for a 20 year term for those active Directors who
apply for such coverage with the District’s provider and meet
the provider’s standard underwriting guidelines and policy
requirements. If coverage at higher amounts or for a longer
term is made available by the provider, each Director may
purchase such additional coverage on a self-pay basis.
2. Each former member of the Board of Directors, who served in
office after January 1, 1981, who was elected to a term of
office that began before January 1, 1995, who is at least
60 years of age, and whose total service at the time of
termination is not less than 12 years, shall be entitled to
the health and welfare and life insurance benefits set
forth in the District Group Insurance Plan Booklet, which
benefits are furnished by the District, at District cost,
for retired Directors.
E.Miscellaneous
Cell Phone expenses are not considered a reimbuseable expense
Attachments
Exhibit A: Approved Function List
Exhibit B: “Board of Directors Per Diem and Mileage Claim Form”
Exhibit C: “Board of Directors Travel Request Form”
Exhibit D: “Board of Directors Expense Claim Form”
EXHIBIT A
Approved Functions List
Board Policy for payment of per diem compensation and expenses for
Director attendance at District meetings:
The Board reviews its authorization and policy for payment of per
diem compensation forpre-approved meetings annually, in January
following reorganization of the Board and election of a new
President. Below is the current Board policy:
1. The following meetings are pre-approved for all Directors
to attend and receive per diem compensation and expense
reimbursement:
Otay Water District Regular and Special Board Meetings
Otay committee meetings for committee members only
Otay business meetings called by the General Manager
and authorized by the President of the Board where
individual Directors are requested to attend
Except as otherwise specifically excluded in this
policy, official District functions that take place
during normal business hours where Directors are
requested to attend by either the Board President or
the Board
Semi-annual conference of the Association of California
Water Agencies
Regular quarterly meetings of the Water Agencies
Association of San Diego County
Regularly monthly meeting of Council of Water Utilities
Business meetings and conferences of the California
Special District Association held in San Diego County
All other meetings not listed here require pre-approval by
the President or Board for Directors to receive per diem
compensation and/or expense reimbursement.
2. The following meetings are pre-approved for designated Otay
Director representatives or designated alternate. The
District Secretary will maintain an updated list of
designated Director representatives. Any other Director who
wishes to attend these meetings and receive a per diem must
have approval from the President or Board prior to the event
or be designated by the President or Board, as an alternate.
The pre-approval shall include the attendance of the
Director at the commission, committee, board or meeting and
any committee, subcommittee or other official or posted
meeting of the agencies, commissions, committees or boards
listed below:
EXHIBIT A
Planning Group and City Commission meetings that fall
within the boundaries of each directors district (when
issues impacting OWD are discussed)
Inter-Agency Committee Meeting
METRO (TAC/AFFORD) Commission
ACWA or CSDA meetings/conferences
Water Conservation Garden
WateReuse Association
South County Economic Development Council
3. The Board President or his designee is pre-authorized to
attend District business meetings with cities and other
agencies to represent Otay Water District, and may claim a
per diem and expenses. Any other Director desiring to attend
the same meeting of this nature would require approval to
attend from the President or the Board in order to receive
a per diem and expense reimbursement.
4. When the President or the Board appoints a director(s) to a
committee, the meeting(s) shall be considered pre-approved
for per diem and expense reimbursement.
5. The following meeting requires pre-approval by the Board
President or Board of Directors to receive per diem and
expense reimbursement:
Regional and/or local Chamber of Commerce business or
board meetings where the District maintains a membership
6. The following meetings are not eligible for pre-approved per
diem claims:
a) Attending other Districts’ Board meetings
b) Otay employee appreciation breakfast, luncheons or
dinners
c) Retirement receptions
d) Otay picnics or dinner-dances or other purely social
events
e) If a per diem reimbursement is provided by another
agency (i.e. San Diego County Water Authority and the
Metro Commission)
f) First Friday Breakfasts unless presenting Otay official
business to the assembly
g) Any political campaign event or function
7. In order to submit a per diem/travel reimbursement the
member must attend at least 50% of the meeting (per day)
and the reimbursement request must be submitted within 45
days of the occurrence, otherwise it may be considered
attended without per diem. The President of the Board will
make the final determination.
EXHIBIT A
8. All other meetings/conferences/tours/seminars/
workshops/functions not listed in this policy must be pre-
approved by the Board President or the Board.
EXHIBIT B
(Director’s Signature)
GM Receipt: Date:
FOR OFFICE USE: TOTAL MILEAGE REIMBURSEMENT: $
OTAY WATER DISTRICT
BOARD OF DIRECTORS
PER-DIEM AND MILEAGE CLAIM FORM
Pay To: Period Covered:
Employee Number: From: To:
ITEM DATE MEETING PURPOSE / ISSUES
DISCUSSED
MILEAGE
HOME to OWD OWD to HOME
MILEAGE
OTHER LOCATIONS
Total Meeting Per Diem:
$
($145 per meeting)
Total Mileage Claimed: miles
EXHIBIT B
INSTRUCTIONS ON REVERSE
EXHIBIT B
INSTRUCTIONS FOR PREPARATION OF
BOARD OF DIRECTORS PER DIEM CLAIM FORM
1. Record the date, and name or purpose/issues discussed of meeting
attended on behalf of the District.
Note: The District will pay Director's per-diem for one meeting/
function per day and the maximum of 10 meetings/functions per month.
If a Director attends more than 10 meetings/functions (10 days), the
District will reimburse for the mileage and any reimbursable out-of-
pocket expenses incurred for these additional meetings.
2. Record number of miles (round trip) driven to attend meeting/ function.
The use of personal vehicles in the conduct of official District business
shall be reimbursed at the current Internal Revenue Service rate. The
Director's expense claim should indicate the nature of the trip. If a trip
begins at home, the District will reimburse the mileage from home to
destination and return mileage. District insurance does not cover personal
vehicles while they are being driven on District business. The reimbursement
rate is inclusive of an allowance for insurance costs. The District will
reimburse Directors for the deductible under their personal insurance policy
should they be involved in an accident while on District business. To be
eligible for reimbursement, each Director shall maintain a current California
driver’s license and at least the minimum vehicle liability insurance
required by State law or shall arrange for a driver who meets said standards.
The District will not reimburse the cost of travel of a personal nature taken
in conjunction with travel on official business.
Claim forms shall be submitted within 45 calendar days after the meeting
date. Expense claims requiring reimbursement to the District which are not
reconciled within 45 calendar days, shall be deducted from the next month’s
reimbursement.
No information on the Per Diem Claim Form may be designated as confidential
in nature. All expenses must be fully disclosed on the form.
EXHIBIT C
OTAY WATER DISTRICT
BOARD OF DIRECTORS
TRAVEL REQUEST FORM
Director: Date of Request:
Name and Location of Function:
Date(s) function to be held: -
Sponsoring Organization:
Request for Prepayment of Fees Related to the Function:
Expense Type Not Needed Pre-Payment
Requested
Registration
Airline
Auto Rental
Mileage N/A
Taxi/Shuttle N/A
Lodging
Meals N/A
Other Expenses – Explain Below
Lodging Preference:
Explanation of Other
Expenses:
Signature of Director Date of Request
For Office Use Only Below This Line
Date of Board
Approval:
Expense Type Description Amount Pre-
Paid
Registration
Airline
Auto Rental
Mileage N/A
Taxi/Shuttle N/A
Lodging
Meals N/A
Other Expenses
District Secretary Date Processed
EXHIBIT D
OTAY WATER DISTRICT
BOARD OF DIRECTORS
EXPENSE CLAIM FORM
Pay To: Period Covered:
Employee Number: From: To:
ITEMIZED REIMBURSEMENT CLAIMED
Date
Type of Reimbursement
Amount
TOTAL Reimbursement Claimed: $
Director Signature: Date:
GM Receipt: Date:
INSTRUCTIONS ON REVERSE
EXHIBIT D
INSTRUCTIONS FOR PREPARATION OF
BOARD OF DIRECTORS EXPENSE CLAIM FORM
The necessary expenses incurred while traveling on District business including
common carrier fares (economy class), automobile rental charges, District business
telephone calls, lodging, baggage handling, parking fees, meals, etc. will be
reimbursed when documented on the Director's Per Diem and Expense Claim Forms.
Receipts must be attached for all meal expenses. If a receipt is lost, the lost
receipt should be noted next to the expense and submitted to the President before
any reimbursement can be made. Receipts are required for the reimbursement of all
expenses.
All receipts must have the nature of the expense and the business purpose
noted on the receipt.
The District will not reimburse the cost of travel of a personal nature taken
in conjunction with travel on official business.
Meals shall be reimbursed as per section 3, Meals and Lodging, of this policy
(Policy 8).
Any receipts that include costs of personal travel (e.g., hotel receipt for
employee and spouse) should identify what the cost would have been without
personal travel (e.g., single room rate as opposed to double room rate).
Claim forms shall be submitted within 45 calendar days after the expense was
incurred. Expense claims requiring reimbursement to the District which are
not reconciled within 45 calendar days, shall be deducted from the next month’s
reimbursement.
No information on the Expense Claim Form may be designated as confidential in
nature. All expenses must be fully disclosed on the form.
The following expenses are not reimbursable:
a. Alcoholic Beverages d. Laundry service
b. Parking or traffic violations e. Entertainment or recreation
c. In-room movies f. Expenses incurred by spouses,
family members, or guests.
ND: 4840-9653-1715, v. 2
ORDINANCE NO. 573
ORDINANCE OF THE BOARD OF DIRECTORS OF THE OTAY WATER DISTRICT
INCREASING THE COMPENSATION TO BE PAID TO
MEMBERS OF THE BOARD OF DIRECTORS FOR COMPENSATION FOR EACH
DAY OF ATTENDANCE AT MEETINGS OF THE BOARD OR FOR EACH DAY OF
SERVICE RENDERED AS A DIRECTOR
WHEREAS, California Water Code Section 20200 et seq. sets forth the authority and
procedure for establishing per diem compensation for the Board of Directors for occurrences
constituting District business, official duties or each day's service rendered as a Director at the
request of the Board, as a "day’s service" is defined and authorized by separate District resolution
and updated from time to time; and
WHEREAS, the California Water Code authorizes an increase in the per diem
compensation that the Board of Directors may receive of up to five percent (5%) for each calendar
year from the effective date of the last increase, and limits the total compensation that may be
received to a maximum of ten (10) days per calendar month; and
WHEREAS, the last adjustment in compensation for the Board of Directors occurred
effective July 1, 2018; and
WHEREAS, the Board of Directors seeks to increase the amount of compensation in
accordance with the provisions of the California Water Code; and
WHEREAS, Section 20204 of the California Water Code provides that the ordinance
increasing compensation to be paid board members shall become effective sixty (60) days from
the date of its final passage; and
WHEREAS, in accordance with Section 20203 of the California Water Code and Section
6066 of the California Government Code, a public hearing was held before the Board at its regular
meeting on April 3, 2019, at 3:30 p.m., or soon thereafter as was practicable, at the District’s
administrative building located at 2554 Sweetwater Springs Boulevard, Spring Valley, California
91978, and a notice of said hearing was duly published in the San Diego Union-Tribune, a
newspaper of general circulation, once a week for two weeks as follows: on March 19, and March
26, 2019.
NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE OTAY WATER
DISTRICT DOES HEREBY PROMULGATE ORDINANCE NO. 573 AND DOES ORDAIN AS
FOLLOWS:
Section 1. Beginning on July 1, 2019, and continuing until modified by Board action, the
per diem compensation for Directors of Otay Water District is increased to One Hundred Fifty
Two Dollars ($152) for each day of attendance at meetings of the Board or for each day of service
rendered as a Director by request or authorization of the Board. Said increase does not exceed five
percent (5%) for each calendar year since the effective date of the last increase; and
Section 2. In accordance with Section 20202 of the California Water Code, no member of
the Board of Directors shall receive the compensation set forth in Section 1 of this Ordinance for
more than ten (10) days in any calendar month.
Section 3. This Ordinance shall take effect on July 1, 2019, pursuant to Section 20204 of
the California Water Code.
Section 4. All ordinances, resolutions, or administrative actions by the Board of Directors,
or parts thereof, that are inconsistent with any provision of this Ordinance are hereby superseded
only to the extent of such inconsistency.
PASSED, APPROVED AND ADOPTED by the Board of Directors of the Otay Water
District at a regular meeting held this 3rd day of April, 2019.
Ayes:
Noes:
Abstain:
Absent:
President
ATTEST:
District Secretary
RESOLUTION NO. 4361
RESOLUTION OF THE BOARD OF DIRECTORS OF THE OTAY WATER DISTRICT
AMENDING BOARD OF DIRECTORS POLICY NO. 8, REIMBURSEMENT OF
EXPENSES.
WHEREAS, the Otay Water District Board of Directors Policy No. 8 provides for, among
other things, per diem compensation for Directors and reimbursement of expenses which are the
personal responsibility of the Directors.
WHEREAS, a revision to Otay Water District Board of Directors Policy No. 8 is required
to reflect the Directors’ increased per diem compensation of One Hundred Fifty Two Dollars
($152) effective July 1, 2019, following the Board’s adoption of Ordinance 573 after a properly
noticed public hearing at its regular meeting on April 3, 2019.
WHEREAS, a revision to Policy No. 8 is required to align the Policy provisions with
District practice concerning certain expenditures which are the personal responsibility of the
Directors.
WHEREAS, the amendments to Policy No. 8 to align the policy provisions with Ordinance
573 and with District practice, are in the District’s interest.
WHEREAS, the strike-through copy of the proposed policy is attached as Exhibit 1 to this
resolution; and
WHEREAS, the Board has reviewed and considered the proposed amendments to Policy
No. 8.
NOW, THEREFORE, BE IT RESOLVED, DETERMINED, AND ORDERED by the
Board of Directors of the Otay Water District that the above stated recitals are incorporated herein
by reference;
BE IT RESOLVED FURTHER that the amended Policy No. 8, incorporated herein as
Exhibit 2, is hereby adopted.
FINALLY BE IT RESOLVED that this resolution shall be in full force and effect
immediately after its passage and approval.
PASSED, APPROVED AND ADOPTED by the Board of Directors of the Otay Water
District at a regular meeting held this 3rd day of April, 2019.
Ayes:
Noes:
Abstain:
Absent:
President
ATTEST:
District Secretary
STAFF REPORT
TYPE MEETING: Regular Board
MEETING DATE: April 3, 2019
SUBMITTED BY:
Dan Martin
Assistant Chief of
Engineering
PROJECT: P2083-001103
P2562-001103
DIV. NO. 2
APPROVED BY:
Rod Posada, Chief, Engineering
Mark Watton, General Manager
SUBJECT: Approval of Change Order No. 3 to the Construction Contract
with Pacific Hydrotech Corporation for the 870-2 Pump Station
Replacement Project
GENERAL MANAGER’S RECOMMENDATION:
That the Otay Water District (District) Board of Directors (Board)
approve Change Order No. 3 to the existing construction contract with
Pacific Hydrotech Corporation (Pacific Hydrotech) in the amount of
$64,864.00 for the 870-2 Pump Station Replacement Project (see
Exhibits A and B for Project location).
COMMITTEE ACTION:
Please see Attachment A.
PURPOSE:
To obtain Board authorization for the General Manager to execute
Change Order No. 3 in the amount of $64,864.00 to the construction
contract with Pacific Hydrotech for the 870-2 Pump Station
Replacement Project.
2
ANALYSIS:
The District’s existing High Head (870-1) and Low Head (571-1) Pump
Stations constructed in 1962 and 1966, respectively, have reached the
end of their useful lives. The 870-2 Pump Station Project will
replace these facilities and includes replacement of existing
Reservoir inlet/outlet piping, construction of recirculation system
pumps, and a chloramine disinfection booster system. Improvements of
the access road and the installation of utilities for electrical,
gas, sewer, and communication services are also included.
The 870-2 Pump Station Replacement Project also includes the
replacement of the 571-1 Reservoir (36.7 MG) floating cover and
liner. The 571-1 Reservoir was originally built in 1967. In 1993
the District retrofitted the existing Reservoir to install a
reservoir liner and floating cover. The existing liner and floating
cover were more than 24 years old and nearing the end of their useful
life. As part of the overall Project, the existing Reservoir outlet
stub-out piping located beneath the Reservoir will be replaced, which
will allow the new 870-2 Pump Station to simultaneously perform its
primary function (pump from the 571-1 Reservoir to the 870-1
Reservoir), recirculate the 571-1 Reservoir, and also achieve a
future function (pump from the 571-1 Reservoir to the 624 Pressure
Zone). The replacement of the cover and liner under this Project
mitigates having to take this critical Reservoir out of service a
second time within the next few years.
The demolition of the Low Head and High Head Pump Stations will be
completed at a later date (not part of this Project) when the new
870-2 Pump Station has been brought on line and completed its
warranty period.
At the July 5, 2017 Board Meeting, the Board awarded a construction
contract in the amount of $16,925,900.00 to Pacific Hydrotech. Since
the award of the construction contract, there have been two (2)
change orders approved under the authority granted to the General
Manager.
Change Order No. 1, which totaled $26,269.83, compensated the
contractor for changes associated with the 571-1 Reservoir cover and
liner improvements. These changes included provisions for additional
cover buoyancy floats; replacement of existing unsalvageable batten
bar anchor bolts; contractor reservoir disinfection in lieu of
contract specified District disinfection; weather related days; and
an adjustment to the contract milestone date for the 571-1 Reservoir.
In total, Change Order No. 1 added 27 days to the contract.
3
Change Order No. 2, which totaled $48,698.12, compensated the
contractor for changes including the following: modifications to the
new electric meter room to accommodate San Diego Gas & Electric
accessibility requirements; modifications to provide two (2) 250-
gallon aqueous ammonia tanks in lieu of one (1) 550-gallon tank to
better serve station operations; provisions for two (2) 30-inch
magnetic flow meters in lieu of ultrasonic flow meters to provide
more resiliency and flexibility with anticipated flow conditions; and
repairs to an existing rectifier electrical conduit adjacent to the
access road. Change Order No. 2 also addressed contract time
including weather days. In total, Change Order No. 2 added 16 days
to the contract.
Change Order No. 3, which is the subject of this staff report,
provides for the following ten (10) items as detailed in the attached
Exhibit C:
1. Implementing the necessary finish plumbing modifications and
bathroom fixtures to complete the station’s bathroom.
2. Modifications to the dimensions of the backup generator
concrete foundation pad to accommodate the anchor bolt edge
distances and vibration isolator mounting plates.
3. Addition of structural support members to adequately support
the heating, ventilation, and air-conditioning (HVAC) equipment
and emergency generator muffler.
4. Revisions to the stations louvers and associated masonry to
reduce noise from the exterior pump engines from entering the
building’s pump room.
5. Installation of door louvers for the compressor room doors to
mitigate negative pressure.
6. Increasing the 16-inch discharge piping on the 570 zone
(recirculation) pumps to 18-inches to reduce anticipated pipe
velocities and minimize resultant pipe system vibration.
7. Revisions to provide a sewn protective thermal insulation
jacket with clips in lieu of the specified thermal insulation
system for the emergency generator muffler and exhaust piping
to facilitate removal and reinstallation during maintenance.
8. Modifying the emergency generator exhaust roof penetration to
simplify future muffler removal/servicing and increasing roof
flashing performance and reliability.
9. Consolidation of exterior lighting controls in a new contactor
and control panel.
10. Granting contract time in accordance with the contract due to
weather impacts.
In total, the cost associated with the items in Change Order No. 3 is
$64,864.00. Time impacts associated with this change are also
provided in Exhibit C. In total, the twenty five (25) additional
days added to the contract will result in a revised total contract
duration of 868 calendar days.
4
FISCAL IMPACT: Joe Beachem, Chief Financial Officer
The total budget for CIP P2083, as approved in the FY 2019 budget, is
$18,950,000.00. Total expenditures, plus outstanding commitments and
forecast, including this contract, are $18,948,691. See Attachment
B-1 for the budget detail.
The total budget for CIP P2562, as approved in the FY 2019 budget, is
$2,900,000.00. Total expenditures, plus outstanding commitments and
forecast, including this contract, are $2,899,446. See Attachment B-
2 for the budget detail.
Based on a review of the financial budget, the Project Manager
anticipates that the budgets are sufficient to support the Project.
The Finance Department has determined that, under the current rate
model, 100% of the funding will be available from the Replacement
Fund for CIP P2083 and for CIP P2562.
STRATEGIC GOAL:
This Project supports the District’s Mission statement, “To provide
exceptional water and wastewater service to its customers, and to
manage District resources in a transparent and fiscally responsible
manner” and the District’s Vision, “To be a model water agency by
providing stellar service, achieving measurable results, and
continuously improving operational practices.”
LEGAL IMPACT:
None.
DM:jf
P:\WORKING\CIP P2083 870-2 Pump Station Replacement\Staff Reports\BD 04-03-19\BD 04-03-19 Staff Report CO No. 3 for
870-2 PS.docx
Attachments: Attachment A – Committee Action
Attachment B1 – P2083 Budget Detail
Attachment B2 - P2562 Budget Detail
Exhibit A – 870-2 Pump Station Project Location
Exhibit B - 870-2 Pump Station Project Detail Map
Exhibit C – Change Order No. 3
ATTACHMENT A
SUBJECT/PROJECT:
P2083-001103
P2562-001103
Approval of Change Order No. 3 to the Construction Contract
with Pacific Hydrotech Corporation for the 870-2 Pump
Station and the 571-1 Reservoir Floating Cover and Liner
Replacement Projects
COMMITTEE ACTION:
The Engineering, Operations, and Water Resources Committee
(Committee) reviewed this item at a meeting held on March 21, 2019
and the following comments were made:
• Staff reviewed the staff report with the Committee and
recommended that the Board approve Change Order No. 3 to the
existing construction contract with Pacific Hydrotech
Corporation (Pacific Hydrotech) in the amount of $64,864.00 for
the 870-2 Pump Station Replacement Project.
• Staff provided a background of Change Orders No. 1 and 2 and
discussed details of Change Order No. 3. Details of Change
Order No. 3 are provided on page 3 of the staff report.
• It was noted that the total cost associated with the items in
Change Order No. 3 is $64,864.00. Time impacts associated with
this change are also provided in Exhibit C of the staff report.
Staff indicated that in total, the twenty-five (25) additional
days added to the contract will result in a revised total
contract duration of 868 calendar days.
• The Committee inquired if Item 3 (Additional Structural Support)
of the change order was recommended by District staff or
contractors. Staff stated that both staff and contractors
determined that additional structural support members were
required to adequately support the heating, ventilation and air-
conditioning equipment and emergency generator muffler.
• The Committee inquired if Item 4 (Revisions to the Stations
Louvers and Associated Masonry to Reduce Noise) of the change
order will lessen internal or external noise. Staff stated that
this implementation would reduce internal noise to the station.
• In response to an inquiry by the Committee regarding design
errors, staff noted that the project’s change order rate is
currently 0.8 percent. Staff also noted that costs associated
with design errors are pursued when it is determined to be in
the best interest of the District.
Following the discussion, the committee supported staff’s
recommendation and presentation to the full board as a consent item.
ATTACHMENT B-1 – P2083 Budget Detail
SUBJECT/PROJECT:
P2083-001103
P2562-001103
Approval of Change Order No. 3 to the Construction Contract
with Pacific Hydrotech Corporation for the 870-2 Pump
Station and the 571-1 Reservoir Floating Cover and Liner
Replacement Projects
Date: 3/04/19
Budget
18,950,000
Planning
Consultant Contracts 48,000 34,948 13,052 48,000 HELIX ENVIRONMNTL PLANNING INC
17,094 17,094 - 17,094 JONES & STOKES ASSOCIATES INC
210,674 210,674 - 210,674 ICF JONES & STOKES INC
Regulatory Agency Fees 2,109 2,109 - 2,109 CA DEPT OF FISH & WILDLIFE
720 720 - 720 CALIFORNIA REGIONAL WATER
1,570 1,570 - 1,570 SAN DIEGO COUNTY WATER AUTH
1,760 1,760 - 1,760 STATE WATER RESOURCES
Service Contracts 2,260 2,260 - 2,260 COUNTY OF SAN DIEGO
164 164 - 164 SAN DIEGO DAILY TRANSCRIPT
505 505 - 505 THE SAN DIEGO UNION-TRIBUNE
Standard Salaries 200,000 181,855 18,145 200,000
Fixed Asset 580,444 580,444 - 580,444
Total Planning 1,065,301 1,034,104 31,197 1,065,301
Design 001102
Consultant Contracts 136 136 - 136 THE WATCHLIGHT CORPORATION
4,850 4,850 - 4,850 BURKETT & WONG ENGINEERS INC
14,068 14,068 - 14,068 SOUTHERN CALIFORNIA SOIL
3,034 3,034 - 3,034 RICK ENGINEERING COMPANY
4,625 4,625 - 4,625 ROGER B WOODHULL
22,149 22,149 - 22,149 NINYO & MOORE GEOTECHNICAL AND
10,484 10,484 - 10,484 HUNSAKER & ASSOCIATES
6,086 6,086 - 6,086 HDR ENGINEERING INC
682,870 682,870 - 682,870 CAROLLO ENGINEERS INC
7,974 7,974 - 7,974 AEGIS ENGINEERING MGMT INC
Regulatory Agency Fees 3,694 3,694 - 3,694 SAN DIEGO GAS & ELECTRIC
16,511 16,511 - 16,511 COUNTY OF SAN DIEGO
Service Contracts 98 98 - 98 DAILY JOURNAL CORPORATION
Standard Salaries 677,054 677,054 - 677,054
Supplier Contracts 5,350 5,350 - 5,350 INLAND AERIAL SURVEYS INC
Total Design 1,458,983 1,458,983 - 1,458,983
Construction
Construction Contracts - - -
13,735,098 6,874,466 6,860,632 13,735,098 PACIFIC HYDROTECH CORPORATION
64,864 - 64,864 64,864 Pacific Hydrotech Co. CO No. 3
722,900 364,249 358,651 722,900 PACIFIC WESTERN BANK
Consultant Contracts 417,983 329,281 88,702 417,983 CAROLLO ENGINEERS INC
1,319 1,319 - 1,319 NINYO & MOORE GEOTECHNICAL AND
17,623 17,623 - 17,623 RBF CONSULTING
780,772 447,366 333,407 780,772 MICHAEL BAKER INT'L INC
438 438 - 438 NINYO & MOORE GEOTECHNICAL
OTHER AGENCY FEES 3,334 3,334 - 3,334 COUNTY OF SAN DIEGO
164,774 164,774 - 164,774 SAN DIEGO GAS & ELECTRIC
Professional Legal Fees 276 276 - 276 ARTIANO SHINOFF
280 280 - 280 STUTZ ARTIANO SHINOFF
Service Contracts 3,628 3,628 - 3,628 MAYER REPROGRAPHICS INC
119 119 - 119 SAN DIEGO DAILY TRANSCRIPT
Standard Salaries 210,000 135,500 74,500 210,000
20,000 - 20,000 20,000 Security System
30,000 - 30,000 30,000 County Access Road Inspection
126,000 - 126,000 126,000 Environmental Offsite Mitigation
10,000 - 10,000 10,000 AT&T Connection
Contingency 115,000 - 115,000 115,000 0.8% of Construction Contract
Total Construction 16,424,407 8,342,651 8,081,756 16,424,407
Grand Total 18,948,691 10,835,737 8,112,953 18,948,691
Vendor/Comments
Otay Water District
p2083-PS -870-2 Pump Station
Committed Expenditures
Outstanding
Commitment &
Forecast
Projected Final
Cost
ATTACHMENT B-2 – P2562 Budget Detail
SUBJECT/PROJECT:
P2083-001103
P2562-001103
Approval of Change Order No. 3 to the Construction Contract
with Pacific Hydrotech Corporation for the 870-2 Pump
Station and the 571-1 Reservoir Floating Cover and Liner
Replacement Projects
Date: 3/4/2019
Budget
2,900,000
Planning
Regulatory Agency Fees 50 50 - 50 PETTY CASH CUSTODIAN
Total Planning 50 50 - 50
Design 001102
Standard Salaries 51,320 51,320 - 51,320
Total Design 51,320 51,320 - 51,320
Construction
Standard Salaries 30,000 15,916 14,084 30,000
150,000 129,300 20,700 150,000 MICHAEL BAKER INT'L INC
2,415,726 2,384,358 31,368 2,415,726 PACIFIC HYDROTECH CORPORATION
127,143 125,493 1,651 127,143 PACIFIC WESTERN BANK
206 206 - 206 CLARKSON LAB & SUPPLY
125,000 - 125,000 125,000 Project Contingency 4.9%
Total Construction 2,848,076 2,655,273 192,803 2,848,076
Grand Total 2,899,446 2,706,643 192,803 2,899,446
Vendor/Comments
Otay Water District
p2562-Res - 571-1 Reservoir Cover/Liner Replac
Committed Expenditures
Outstanding
Commitment &
Forecast
Projected Final
Cost
OTAY WATER DISTRICT870-2 PUMP STATIONLOCATION MAP
EXHIBIT A
CIP P2083F
P:\WORKING\CIP P2083 870-2 Pump Station Replacement\Graphics\Exhibits-Figures\Exhibit A, Location Map, May 2016.mxd
ROLLRESERVOIR(571-1)
LOW HEADPUMP STATION
HIGH HEADPUMPSTATION
FOR PROJECT DETAILSEE EXHIBIT B
ACCESS FROMALTA RD
OWD PROPERTY LINE(APPROX)
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VICINITY MAP
PROJECT SITE
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OTAY WATER DISTRICT870-2 PUMP STATIONPROJECT DETAIL MAP
EXHIBIT B
CIP P2083F
P:\WORKING\CIP P2083 870-2 Pump Station Replacement\Graphics\Exhibits-Figures\Exhibit B, Project Detail Map, May 2016.mxd
0 10050
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Legend
ExistingEasementOWD
ExistingParcelOWD
ExistingEasementSDGE
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ProposedSewer
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ExistingWaterOWD
Contract / P.O. Change Order No. 3 page 2 of 3
Description of Work
Description
Increase Decrease Time
Item No. 1:
Charges attributable to the 870-2 PS (CIP 2083). This Change Order
provides for modifications to Room P104 (Closet Room) per RFP 002.
$5,980.00 2
Item No. 2:
Charges attributable to the 870-2 PS (CIP 2083). This Change Order
provides for modifications to the backup generator concrete foundation pad
per COR 018.
$7,038.00 1
Item No. 3:
Charges attributable to the 870-2 PS (CIP 2083). This Change Order
provides additional HVAC and muffler support structural members per COR
019.
$11,642.00 3
Item No. 4:
Charges attributable to the 870-2 PS (CIP 2083). This Change Order
provides for louver and pilaster modifications per RFP 009.
$7,007.00 3
Item No. 5:
Charges attributable to the 870-2 PS (CIP 2083). This Change Order
provides door louvers to Room P104 (Air Compressor Room) per COR 27.
$778.00 0
Item No. 6:
Charges attributable to the 870-2 PS (CIP 2083). This Change Order
increases the 570-zone pump discharge pipe size to 18-inch per COR 28.
$9,777.00 0
Item No. 7:
Charges attributable to the 870-2 PS (CIP 2083). This Change Order
provides for modifications to the emergency generator thermal insulation
requirements per COR 030.
$12,060.00 1
Item No. 8:
Charges attributable to the 870-2 PS (CIP 2083). This Change Order
provides for modifications to the emergency generator exhaust roof
penetration per COR 033.
$4,534.00 0
Item No. 9:
Charges attributable to the 870-2 PS (CIP 2083). This Change Order
provides for modifications to exterior lighting controls per RFP 007A.
$6,048.00 3
Item No. 10:
Add twelve (12) calendar days due to weather impacts per Contract
Specifications 00700-8.5
$0.00 $0.00 12
Sub Total Amount $64,864.00 $0.00 25
Total Net Change Order Amount $64,864.00
Reason:
Item No. 1:
The Contract provided sewer and water connections to Room P104 for future conversion to a unisex bathroom. It was
determined to implement the conversion as part of construction operations. This Change Order is required to provide and
implement the necessary finish plumbing modifications and bathroom fixtures to change the purpose of the room from a closet
to a bathroom per RFP 002.
Contract / P.O. Change Order No. 3 page 3 of 3
Item No. 2:
The Contract included a 5-foot 6-inch by 16-foot 4-inch structural concrete foundation pad for the emergency generator.
Subsequent to submittal approval it was determined that a 10-foot by 22-foot structural concrete foundation pad was required to
support the generator and provide anchor bolt edge distances for the vibration isolator mounting plates. This change order
provides for the required structural concrete foundation pad size revision per COR 018.
Item No. 3:
During submittal review it was determined that additional structural support members were required to adequately support the
heating, ventilation and air-conditioning (HVAC) equipment and emergency generator muffler. This change order is required to
provide the additional support members per COR 019.
Item No. 4:
The Contract Documents provided seven louvers along the East wall of the pump room. During pump station layout it was
determined that relocation of the louvers from the East wall would substantially reduce the amount of noise from exterior pump
engines (located outside the East wall) from entering the pump room. The total square footage of louver did not materially
change and was implemented at no cost. Due to the 10-foot by 12-foot masonry opening required to accommodate a single
louver two additional pilasters were required to support the South pump room wall. This change order is required to implement
the changes per RFP 009.
Item No. 5:
The Contract Documents did not provide for exterior make-up air to compressor room (P104). During submittal review it was
determined that door louvers were required to mitigate the potential for generating negative pressure in the room during extended
compressor operating periods. This change order is required to install a one square foot louver in each compressor room door
per COR 027.
Item No. 6:
The Contract Documents included 16-inch discharge piping on the 570 zone (recirculation) pumps. During submittal review it
was determined to increase discharge pipe diameter to 18-inch thereby reducing anticipated velocities and minimizing resultant
pipe system vibration. This change order is required to implement the modification per COR 028.
Item No. 7:
The Contract Documents included unsewn protective thermal insulation wired to the emergency generator muffler and exhaust
piping. During submittal review it was determined that the project would benefit from a sewn and easily removable jacketed
insulation to facilitate future servicing while increasing longevity. It was determined to modify the requirements to include a
custom sewn insulation jacket with clips to facilitate maintenance removal while increasing service life. This change order is
required to implement the modification per COR 030.
Item No. 8:
The Contract Documents included a specialized detail to support the emergency generator exhaust roof penetration resulting in
a complex flashing and waterproofing condition. Additionally, based upon the generator exhaust layout an additional structural
support would have been required as support. Discussions revealed an alternate penetration method mitigating the flashing
complexity and need for an additional structural support member. It was determined to proceed with a thimble roof penetration
detail which will simplify future muffler removal for potential servicing and increase roof flashing performance and reliability. This
change order is required to implement the modification per COR 033.
Item No. 9:
During construction the designer issued revisions to the lighting control system in response to RFI 118 resulting in consolidation
of exterior lighting controls in a new contactor and control panel. This change order is required to implement the modification
per RFP 007A.
Item No. 10:
Contract Documents Section 00700-8.5 provides for no cost time extensions due to weather impacts on the project progress.
Weather impacted the project twelve (12) days between January 24, 2018 and February 28, 2019. The project was impacted
on February 1, 4, 5, 6, 7, 8, 14, 15, 19, 20, 21 and 22, 2019 due to weather.
870-2 Pump Station Replacement Project Project: P2083/P2562
Consultant/Contractor: Pacific Hydrotech Corporation Subproject: 001103
APPROVED
C.O.AMOUNT BY DATE DESCRIPTION TYPE C.O.
1 $26,269.83 GM 5/18/2018
Change order provides for additional buoyancey floats,
anchor bolts, and a modified disinfection procedure for the
571-1 Reservoir. Also addresses contract time for weather.
Contractor
2 $48,698.12 GM 1/29/2019
Electric service room modifications; ammonia storage
modifications; replace ultrasonic flow meters with magnetic
type; relocate existing rectifier power conduit; and weather
days
Contractor
3 $64,864.00 Board
Bathroom fixtures; backup generator concrete foundation
pad modifications; HVAC muffler support structural
members; louver and pilaster modifications; door louvers;
increase pump discharge pipe size to 18-inch; modify
emergency generator thermal insulation; emergency
generator exhaust roof penetration; esterior lighting controls
modifications; weather days.
Contractor
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Total C.O.'s To Date: $139,831.95 0.8%
Original Contract Amount:$16,925,900.00
Current Contract Amount:$17,065,731.95
Month Net C.O.$ Limit Authorization Absolute C.O.$ C.O. %
3/19 $64,864.00 $2,000 Insp $64,864.00 0.4%
$5,000 PM/Sr. Engr. 0.0%
$15,000 Asst. Chief 0.0%
$20,000 Chief 0.0%
$75,000 GM 0.0%
>$75,000 Board 0.0%
CHANGE ORDER LOG
P:\WORKING\CIP P2083 870-2 Pump Station Replacement\Staff Reports\BD 04-03-19\Backup\COLOG_1903041 3/4/2019
STAFF REPORT
TYPE MEETING: Regular Board
MEETING DATE: April 3, 2019
SUBMITTED BY:
Jake Vaclavek,
System Operations Manager
PROJECT: DIV. NO. 1, 2, 5
APPROVED BY:
Jose Martinez, Assistant Chief of Operations
Pedro Porras, Chief of Operations
Mark Watton, General Manager
SUBJECT: AWARD OF CONTRACT FOR RESERVOIR FLOATING COVER MAINTENANCE
GENERAL MANAGER’S RECOMMENDATION:
That the Board awards a contract to Layfield USA for the maintenance
of the floating covers on four potable and two recycled water
reservoirs for an amount not to exceed $169,805 for Fiscal Year 2020;
with four (4) one-year options for renewal at the General Manager’s
discretion.
COMMITTEE ACTION:
Please see attachment A.
PURPOSE:
To effectively maintain the District’s floating covers as required by
the State Water Resources Control Board (SWRCB) and as recommended by
the American Water Works Association (AWWA) guidelines.
ANALYSIS:
The SWRCB requires agencies that have potable water reservoirs with
floating covers to maintain them as per approved maintenance plans.
These plans are made using AWWA guidelines. The maintenance involves
2
cleaning of the entire cover, repairing minor holes and tears,
adjusting tensioning devices and maintaining the rainwater removal
system. The District has four potable reservoirs with covers that
need to be maintained twice a year. The District also has two
recycled reservoirs with floating covers that will be included in the
contract to be maintained once per year. The recycled reservoir
cover maintenance is not required by the SWRCB, but will be done as
an “Effective Management Practice” to help extend the useful life of
the covers.
Description of Reservoirs
Reservoir Name Type Surface Area* Capacity (MG)
571-1 Potable 195,000 36.7
624-1 Potable 110,000 12.0
711-3 Potable 157,000 16.0
870-1 Potable 97,000 10.9
927-1 Recycled 163,000 16.3
944-1 Recycled 102,000 12.0
*In square feet, approximate area at high water level.
Quotes were solicited via BidSync, the District’s online bid
solicitation website, and the Otay Water District’s website. Three
quotes were received on February 4, 2019 with the following results:
Contractor Total Amount
1. Layfield USA $169,805
Spring Valley, CA
2. Erosion Control Applications $173,910
Anaheim, CA
3. COMANCO Environmental $1,500,000
Plant City, FL
Layfield USA has cleaned and maintained the District’s floating
covers for the last 10 years. They also replaced the cover and liner
on the 624-1, 571-1, 927-1 and the 711-3 reservoirs. Layfield is an
industry leader in the design, installation and maintenance of
reservoir floating covers. District staff have found them to be
reliable, responsible, and an accommodating company.
Staff is recommending the award of this maintenance contract to
Layfield USA in the amount not-to-exceed $169,805 for one year,
beginning in Fiscal Year 2020; with four (4) one-year options for
3
renewal at the General Manager’s discretion. The maximum price
increase for the four option years would be based on the San Diego
Consumer Price Index for the previous year.
FISCAL IMPACT: Joe Beachem, Chief Financial Officer
The amount of $169,805 has been submitted for the Fiscal Year 2020
Budget for this contract to cover all work related to this
maintenance. Annual amount for contract renewal will be budgeted in
subsequent fiscal years.
STRATEGIC GOAL:
This contract helps maximize the District’s useful life of its
reservoir floating covers. Properly maintained covers also protect
the water quality within our District and helps keep the District in
regulatory compliance.
LEGAL IMPACT:
None.
Attachments: Attachment A – Committee Action
ATTACHMENT A
SUBJECT/PROJECT:
AWARD OF CONTRACT FOR RESERVOIR FLOATING COVER MAINTENANCE
COMMITTEE ACTION:
The Operations and Engineering Committee reviewed this item at a
meeting held on March 21, 2019 and the following comments were made:
• Staff recommended that the Board award a contract to Layfield USA
for the maintenance of the floating covers on four potable and
two recycled water reservoirs for an amount not-to-exceed
$169,805 for Fiscal Year 2020; with four (4) one-year options for
renewal at the General Manager’s discretion.
• As noted in the staff report, the District has two (2) recycled
floating cover reservoirs that will be included in the contract
to be maintained once per year. This is done not as a state
requirement, but as an Effective Management Practice to help
extend the useful life of the covers.
• The Committee stated that it was a pleasure to see that the
District is contracting with a local company.
Following the discussion, the committee supported staff’s
recommendation and presentation to the full board as a consent item.
STAFF REPORT
TYPE MEETING: Regular Board
MEETING DATE: April 3, 2019
SUBMITTED BY:
Stephen Beppler
Senior Civil Engineer
PROJECT: S1502-
001000
DIV. NO. All
APPROVED BY:
Bob Kennedy, Engineering Manager
Dan Martin, Assistant Chief, Engineering
Rod Posada, Chief, Engineering
Mark Watton, General Manager
SUBJECT: Adopt Resolution No. 4356 to Approve the Amended and Restated
Regional Wastewater Disposal Agreement Between the City of San
Diego and the Participating Agencies in the Metropolitan
Sewerage System
GENERAL MANAGER’S RECOMMENDATION:
That the Otay Water District (District) Board of Directors (Board)
adopt Resolution No. 4356 (Attachment B) to approve the Amended and
Restated Regional Wastewater Disposal Agreement between the City of
San Diego (City) and the Participating Agencies (PA) in the
Metropolitan Sewerage System (Metro) (Agreement) and authorize the
General Manager to execute the Agreement. The updated Agreement
(Exhibit A) incorporates the Pure Water San Diego (Pure Water)
program, which is a long-range regional water reuse plan with the
goal of realizing a secondary equivalent Point Loma Wastewater
Treatment Plant (PLWTP) and a new local sustainable water supply.
COMMITTEE ACTION:
Please see Attachment A.
PURPOSE:
In order to comprehensively and equitably address the costs and
revenues associated with the Pure Water project and the related
2
construction, expansion, and modification of the Metro wastewater
facilities, the City and the PAs wish to amend and restate the
Agreement.
ANALYSIS:
Background
The Metropolitan Wastewater Joint Powers Authority (JPA) is a
coalition of municipalities and special districts in the southern and
central portions of San Diego County that share in the use of the
City's regional wastewater collection and treatment facilities. The
District is one of twelve (12) PAs in the JPA party to the agreement
with the City for wastewater treatment. Other JPA member agencies
include the cities of Chula Vista, Coronado, Del Mar, El Cajon,
Imperial Beach, La Mesa, National City, Poway, the County of San
Diego Sanitation District, the Lemon Grove Sanitation District, and
Padre Dam Municipal Water District. The District contributes roughly
0.5% of the wastewater flow to the Metro system while the JPA
represents approximately 35% of the Metro flow.
The City’s sewage system dates back to 1885, but a formal agreement
between the PAs was not established until 1998 under a Regional
Wastewater Disposal Agreement. The Metropolitan Wastewater
Commission (Metro Commission) was formed at that time pursuant to the
terms of the Agreement between the PAs and the City. In 2001, the
JPA was formed to provide the PAs with a stronger voice in the
operations of the Metro System.
PLWTP operates under a National Pollution Discharge Elimination
System (NPDES) permit modified under section 301(h) & (j)(5) of the
Clean Water Act, which allows for the facility to operate as an
advanced primary treatment plant under a waiver that must be renewed
every 5 years. The loss of that waiver would require PLWTP to
upgrade to secondary treatment. For the permit renewal in 2015, the
Pure Water Program strategy allows for the attainment of treatment
within the Metro system that could allow PLWTP to be permitted as
equivalent to secondary treatment. This involves diverting 83 MGD of
sewage for water purification to potable water quality while allowing
the PLWTP to continue its current operating process. The first phase
of the Pure Water project to be constructed at the North City Water
Reclamation Plant is expected to produce 30 MGD of indirect potable
reuse water to be conveyed to Miramar reservoir.
To continue to operate the PLWTP at the advanced primary treatment
level, the City is seeking passage of federal legislation, with
support from the environmental community. The proposal, called Ocean
3
Pollution Reduction Act II (OPRA II), will allow the City’s NPDES
permit to be based on secondary equivalency with a commitment to
implement potable reuse of wastewater. Until permanent federal
legislation is adopted to recognize secondary equivalence, there is
uncertainty about the total financial cost strategy for wastewater
associated with the Pure Water project.
Amended and Restated Regional Wastewater Agreement
The proposed changes to the existing 1998 Regional Wastewater
Disposal Agreement primarily consist of the following:
1. Define the Pure Water Program and secondary equivalency for
PLWTP;
2. Change methodology for repayment of future capital investment
projects, where costs for Pure Water are based upon flow and
strength commitments for planning year 2050 as listed in
Exhibit G of the Agreement;
3. Set cost allocations between water and wastewater facilities
reflective of wastewater operation requirements for secondary
discharge for ocean disposal;
4. Establish alternative capacity rights reflecting secondary
equivalency implementation, which reduces the wastewater
infrastructure construction for Pure Water to reflect the flow
projections for planning year 2050;
5. Provide a maximum cap on financial exposure to wastewater
customers from the Pure Water Program based upon the cost of
converting PLWTP to secondary treatment, determined to be $1.8
billion in November 2018 dollars for a capacity of 180 MGD;
6. Establish criteria for requiring agencies to obtain additional
treatment capacity should their flow and/or strength exceed
their contracted limits and setting penalties if they fail to
do so upon notification; and
7. Provide sharing of potential future water revenues when Pure
Water potable supply costs become less expensive than other
supply sources.
The District’s flow and strength commitments identified in Exhibit G
of the Agreement are based upon the assumption that the Ralph W.
Chapman Water Reclamation Facility (RWCWRF) will be operational
through 2050. Should the District decide to cease treating flow at
RWCWRF, additional Pure Water flow and strength capacity would need
to be obtained following the procedures established in the Agreement.
Underpayments to the date of revising the capacities would need to be
paid within 4 years on a quarterly basis.
4
District staff reviewed each of the developmental drafts of the
Agreement and provided numerous comments that are viewed as providing
safeguards for the District. Among these are providing adequate
durations before additional flow or strength capacity commitments are
triggered by exceeding the established Pure Water limits set in
Exhibit G of the Agreement. Initial drafts had set this at 3 months,
with subsequent negotiations extending this to 3 years of continuous
exceedance levels at 10 percent above the commitment level. With the
District’s operation of RWCWRF currently being considered in the
District’s planning year 2050 capacity rights, it was important that
short-term shutdowns of the plant not result in the need to obtain
additional capacity rights. If the District were to trigger the need
for increasing contract capacity and not do so, the Agreement
provides for the City to assess damages at $1 for each gallon of flow
in excess of the contract capacity during each quarter year of
occurrence until the new capacity is obtained.
Pure Water Phase I cost projection dated October 2018 estimated the
total cost to Water and Wastewater at $1.44 billion. Metro
Wastewater allocation is currently projected at thirty-nine percent
(39%) of the overall estimated cost and City Water allocation is
sixty-one percent (61%). At this distribution of costs, Phase I is
projected at $562 million or about 31% of the Wastewater portion of
the Pure Water commitment. Based upon Exhibit G of the Agreement,
the District’s portion of the Phase I costs is currently projected at
$2.57 million, with a total Pure Water cost estimated at $8.23
million in 2018 dollars.
The entire Pure Water Program costs for all phases to meet the
program goal of producing 83 MGD of potable reuse water was estimated
to cost $2.5 to $3 billion dollars in 2014 when the Cooperative
Agreement between the City of San Diego and San Diego Coastkeeper,
Surfrider Foundation San Diego Chapter, Coastal Environmental Rights
Foundation, and the San Diego Audubon Society was approved to support
the PLWTP’s NPDES Permit.
FISCAL IMPACT: Joe Beachem, Chief Financial Officer
Pure Water Phase I is projected to cost the District’s sewer
customers $2.57 million. The City is expected to obtain financing
for a large portion of the capital cost, so the impact will be
amortized over a period of 20 to 30 years depending on the types of
financing. There have been several changes to the terms of the
agreement since the City last provided a cost allocation estimate
around June of 2018. Based on the last cost allocation estimate,
Phase I is expected to increase the annual Metro fees by an average
of $250,000 between FY 2019 and FY 2024, which equates to a rate
5
impact of approximately of 9.0% over the same period. The FY 2018
and FY 2019 rate models were prepared including these additional
costs in the projected rates and rate increases. Phase I is expected
to be operational in 2023.
Pure Water Phase II planning costs are expected to begin being
incurred within the next 5 years and the associated capital costs are
expected to begin being incurred in 2030, with Phase II being
operational in 2035. The final methodology for Phase II cost
allocation has not been determined and the City has not provided
final cost estimates, cost allocation figures, or a cost allocation
methodology for Phase II; however, using the same allocation methods
used to determine the impact of Phase I and based on a cap of $1.8
billion, Phase II will cost the District an additional $5.66 million.
Based on the annual cost impact of Phase I, Phase II would equate to
an annual additional expense of $550,000 per year, which would have a
rate impact of approximately 20.0%. The majority of this rate
increase would be anticipated to be incorporated into the rates as
the 2030 construction timeframe approaches and may impact rates up to
and beyond the 2035.
STRATEGIC GOAL:
This Resolution supports the District’s Mission statement, “To
provide exceptional water and wastewater service to its customers,
and to manage District resources in a transparent and fiscally
responsive manner” and the District’s Vision, “To be a model water
agency by providing stellar service, achieving measurable results,
and continuously improving operational practices.”
LEGAL IMPACT:
Unknown at this time.
SB/BK:jf
P:\WORKING\CIP S1502 - City of San Diego Metro Water Issues\Staff Reports\Bd 01-02-19, Staff Report
Metro JPA Restated and Amended Agreement\BD 01-02-19 Staff Report Metro JPA-Restated and Amended
Wastewater Agreement.docx
Attachments: Attachment A – Committee Action
Attachment B – Resolution No. 4356
Exhibit A – Draft Amended and Restated Regional
Wastewater Agreement
ATTACHMENT A
SUBJECT/PROJECT:
S1502-001000
Adopt Resolution No. 4356 to Approve the Amended and
Restated Regional Wastewater Disposal Agreement Between the
City of San Diego and the Participating Agencies in the
Metropolitan Sewerage System
COMMITTEE ACTION:
The Engineering, Operations, and Water Resources Committee (Committee)
reviewed this item at a meeting held on December 4, 2018, and the
following comments were made:
Staff provided a background of the existing agreement and
discussed the proposed changes that are within the Agreement and
presented in the staff report.
The Agreement is driven primarily to address the City’s Pure
Water Program. It includes an establishment of capacity
commitments reflecting secondary equivalency implementation that
reduces the wastewater infrastructure construction for Pure Water
based on flow projections for planning year 2050 (See Exhibit G
of the Agreement). Staff indicated that the existing agency
contract capacity (See Exhibit B of the Agreement) could be
revised in the future if the discharge permit conditions change
for secondary equivalency. Staff is working on a memo for the
basis of the District’s capacity on Exhibit G of the Agreement
and will present this to the Board in a future General Manager’s
report.
The District’s flow and strength commitments identified in
Exhibit G of the Agreement are based upon the assumption that the
RWCWRF will be operational through 2050.
Staff indicated that the Pure Water Phase I project cost dated
October 2018 estimated the total cost to Water and Wastewater at
$1.44 billion with 39% attributed to wastewater. See Page 4 of
the staff report for additional cost projections. Staff noted
that the entire Pure Water Program was estimated at $2.5 to $3
billion dollars in 2014.
On November 15, 2018, the City of San Diego Council authorized
the Mayor to execute the Agreement, as presented in this staff
report, with participating agencies.
On November 27, 2018, EPA issued a $614 million Water
Infrastructure Finance and Innovation Act (WIFIA) loan for the
first phase of Pure Water. This loan is for the Water portion of
the project. SRF funding for the Wastewater portion of the
project is being sought with terms of 2% for 30 years expected.
This funding would need to be in place prior to the start of
construction.
In response to a question from the Committee, staff stated that
the District’s legal counsel has fully reviewed the Agreement.
The Committee inquired if there were any disclosures or
liabilities that the District should be concerned about with the
Agreement. Legal counsel stated that the Agreement gives the
City of San Diego more discretion whereas the City can negotiate
with participants, but there are no provisions for sanctions,
grievances, liabilities or consequences should the City fail to
act in good faith.
Staff stated that active discussions/negotiations of the
Agreement have taken place with lawyers and staff from the
District, other participating agencies, and the City. As a fail-
safe, if the City does not act in good faith, the Agreement does
have a $1.8 billion cap (based upon November 2018 cost index) in
place.
In response to a question from the Committee, staff stated that
the only other option for the District is to continue to operate
under the old agreement that that does not include a $1.8 billion
cap.
The Committee inquired if there were other benefits in the
Agreement besides the $1.8 billion cap. Staff stated that the
District can opt out of the agreement if written notice is
provided by December 31, 2019 and flow is diverted from the
system before July 1, 2025.
In response to a question from the Committee, legal counsel
stated that this Agreement would not impact the District’s
current litigation against the City of San Diego.
The Committee commented that the District currently has a 1.287
MGD contract capacity with the City. The flow commitment towards
Pure Water is a capacity of 0.38 MGD for planning year 2050.
The Committee inquired if there were other changes in the
Agreement since August 1, 2018, when it was presented to the
Board at its regular board meeting. Staff stated that there were
changes which include clarifications related to dealing with
management of residuals (solids, brine, and centrate) from future
reclamation projects, setting the initial $1.8 billion cap
effective date, increasing the period of capacity exceedance to
three years before requiring additional capacity purchasing, and
changing the date that an agency needs to withdraw from Metro to
avoid participating in the Pure Water Program.
With possible impacts from the Agreement, the Committee suggested
that staff create a one-page implication for the District’s
departments (i.e., Engineering, Finance, Operations). Staff has
generated the following table to summarize the aspects each
department needs to consider from the Agreement in the future.
Department Agreement Impacts
Operations Ensure long-term operability of the
RWCWRF to not exceed the Pure Water
flow commitment capacity for 3
consecutive years
Consider long-term necessity and
benefit of any process improvement
identified for implementation
Engineering Support Operations and Finance in
assessing the continued operation
of RWCWRF versus the procurement of
additional Metro capacity
Perform cost to benefit analysis on
future RWCWRF improvements to
ensure proposed work is justified
economically as well as
operationally
Finance Track capital plus operational and
maintenance costs for the continued
operation of RWCWRF versus Metro
costs
Assess distribution of Metro Pure
Water costs upon existing and
future customers in setting near
term and future sewer availability
fees
Following the discussion, the Committee supported staffs’
recommendation and presentation of this item to the full board as an
Action Item.
At the January 2, 2019 Board of Directors Meeting, this action item
was postponed to a later date to provide staff additional time to
determine the potential impact of discussions between the City of San
Diego and Padre Dam Municipal Water District (MWD) concerning the East
County AWP program and its residual management.
On February 26, 2019, the District sent a letter to the City of San
Diego Public Utilities Department (PUD) stating its interpretation of
several sections of the Agreement (related to the operation of RWCWRF
and return of solids to the sewer system) and asking for the City to
acknowledge and agree to the interpretation (see Attachment C to this
staff report). This letter was signed and dated by the Interim
Director of PUD on March 7, 2019.
The Residuals Management Working Group of Metro Technical Advisory
Committee (Metro TAC) under Metro Wastewater Joint Powers Authority
(JPA) has been facilitating the negotiations between the City of San
Diego and Padre Dam MWD. The District met with the members of this
group (Jerry Jones, Dexter Wilson, Roberto Yano, and Scott Tulloch) on
March 19, 2019 to understand the framework of the General Residuals
Disposal Agreement between those two parties that is nearing
completion. The current operation of the existing RWCWRF does not
require a similar agreement, but the District will continue to monitor
the Metro Agreement amendment that will address Phase 2 of the Pure
Water Program to determine if there would be any benefit in having its
own General Residuals Disposal Agreement. At the meeting, the
District requested that Metro TAC and the JPA create a paper record on
the cost of construction and the allocation of costs for the Pure
Water Program to the City of San Diego either through council
meetings, letters, or other public forums.
ATTACHMENT B
RESOLUTION NO. 4356
RESOLUTION OF THE OTAY WATER DISTRICT APPROVING THE AMENDED
AND RESTATED REGIONAL WASTEWATER DISPOSAL AGREEMENT WITH
THE CITY OF SAN DIEGO AND AUTHORIZING THE GENERAL MANAGER TO
EXECUTE THE AGREEMENT
WHEREAS, the Otay Water District (District) is one of 12 participating agencies of the
Metropolitan Sewerage System (Metro System) which is owned and operated by the City of
San Diego (City); and
WHEREAS, the City and the participating agencies entered into that certain Regional
Wastewater Disposal Agreement dated May 18, 1998 (the “1998 Agreement”), which provided,
among other things, for certain contract rights to capacity in the Metropolitan System, a system
of wastewater conveyance, treatment, and disposal facilities, and the establishment of a
mechanism to fund the planning, design, construction, operation, and maintenance of the Metro
System by the City and the participating agencies.
WHEREAS, the District adopted Resolution No. 4243 on October 1, 2014, which
supported the Point Loma Wastewater Treatment Plant (PLWTP) National Pollutant Discharge
Elimination System (NPDES) permit, and included a goal for Pure Water San Diego (Pure
Water) to achieve the standards outlined in the permit by reducing solids discharged from
PLWTP to a level equivalent to that of converting the PLWTP to secondary treatment while
generating a potable water source; and
WHEREAS, the 1998 Agreement does not adequately address the complexities
associated with implementation of the Pure Water program, including new facilities, allocation
and financing of costs, potential revenue distribution, and capacity rights; and
WHEREAS, the City and the participating agencies have been working since 2014 on
deal points for the Pure Water program which have been incorporated into an Amended and
Restated Regional Wastewater Disposal Agreement (Agreement); and
WHEREAS, the Agreement, among other things, sets a capital improvements spending
cap for the participating agencies based upon the cost of converting PLWTP to secondary
treatment; and
Y:\Board\CurBdPkg\ENGRPLAN\2019\BD 04‐03‐2019\Adopt Resolution No. 4356 to Approve The Amended Regional
Wastewater Disposal Agreement with City of San Diego\Attachment B Resolution ‐ Amended and Restated Wastewater
Disposal Agreement.doc
WHEREAS, the City of San Diego City Council on November 15, 2018 authorized the
Mayor or his designee to execute the Agreement with the participating agencies.
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Otay Water
District that the above stated recitals are incorporated herein by reference;
IT IS RESOLVED FURTHER that the Board of Directors of the Otay Water District
approves the terms and provisions of the Amended and Restated Regional Wastewater Disposal
Agreement; and
IT IS RESOLVED FURTHER that the Board of Directors of the Otay Water District
hereby authorizes the General Manager to execute the Amended and Restated Regional
Wastewater Disposal Agreement on behalf of the District.
PASSED AND ADOPTED at a regular meeting of the Board of Directors of the Otay
Water District on the 3rd day of April, 2019:
AYES:
NOES:
ABSENT:
ABSTAIN:
__________________________
President
ATTEST:
_____________________________
District Secretary
... CDedlcnted to ColllnHllllc~ ge,~utce
2554 SWEETWATER SPRINGS BOULEVARD, SPRING VALLEY. CALIFORNIA 91978·2004
TELEPHONE: 670·2222. AREA CODE 619
February 26, 2019
Matthew Vespi
Interim Director, Public Utilities Department
City of San Diego
9192 Topaz Way, MS 904A
San Diego, CA 92123
www.otaywater.gov
Project No.: S1502-001000
SUBJECT: Amended and Restated Regional Wastewater Disposal Agreement
Dear Mr. Vespi,
The staff of Otay Water District ("District") is in the process of obtaining authorization from
the District's Board of Directors ("Board") for the General Manager to execute the
Amended and Restated Regional Wastewater Disposal Agreement ("Amended
Wastewater Agreement") between the City of San Diego ("City") and the Participating
Agencies in the Metropolitan Sewerage System ("Metro System"). A staff report relating
to the Amended Wastewater Agreement was presented to the District's Engineering,
Operations, and Water Resources Committee at their December 4, 2018 meeting. The
Amended Wastewater Agreement staff report was slated to be presented to the District
Board at their January 2, 2019 meeting, but it was removed from consideration after the
District received information about on -going negotiations between the City of San Diego
and Padre Dam Municipal Water District, the San Diego County Sanitation District, and
the City of El Cajon ("East County AWP Parties") regarding the disposal, treatment, and/or
management of solids, brine, and centrate ("residuals") from the East County Advanced
Water Purification ("AWP") Program facilities under the Amended Wastewater
Agreement. Of specific concern to the District is that the City will prohibit all Participating
Agencies' disposal of residuals into the Metro System.
The Amended Wastewater Agreement defines residuals as consisting of "solids, brine,
and centrate" in Section 2.9.3. The District sends solids to the Metro System from its
Ralph W. Chapman Water Reclamation Facility (RWCWRF), which produces Title 22
recycled water. Accordingly, it is of utmost importance for the District to properly
understand the meaning of Section 2.9.3 and the City's intent with regard to the disposal,
treatment, and/or management of residuals from non-Metro facilities, before it can
consider executing the Amended Wastewater Agreement.
The Amended Wastewater Agreement permits the District to operate the RWCWRF and
thereby divert flow from the Metro System (see Section 2.3.2.). Section 2.6 Limitations
Matthew Vespi
Amended and Restated Regional Wastewater Disposal Agreement
February 26, 2019
Page 2 of 2.
on Types and Condition of Wastewater, does not place specific limits on the waste effluent
from reclamation facilities that is sent to the Metro System. The District has sent solids
from the RWCWRF to the Metro System since 1980, when the plant was placed into
operation. The District's interpretation of the Amended Wastewater Agreement is that it
can continue to operate the RWCWRF and continue to send waste effluent from this
reclamation facility to the Metro System, and that it will be charged for such waste effluent
pursuant to Article V of the Amended Wastewater Agreement based on its proportionate
flow in the Metro System and the strength of its wastewater. The District understands
that the Amended Wastewater Agreement also permits it to be able to increase the
amount of wastewater it treats and the solids it sends to the Metro System, subject to the
aforementioned terms of Artic.le V.
The District also interprets that neither the provisions of Paragraph 2.9.3 in the Amended
Wastewater Ag reement concerning residuals nor any limitations that the City may apply
to other Participating Agencies relating to the Advanced Water Purification project apply
to reclamation facilities such as the RWCWRF.
Furthermore, the District interprets the Amended Wastewater Agreement as allowing it
(1) to make improvements or changes to the RWCWRF's treatment processes, (2) to
continue to produce recycled water at the RWCWRF for irrigation purposes in accordance
with regulatory requirements, and (3) that it may transfer the RWCWRF to another
Pa rticipating Agency subject to the terms of Article V.
We request that the City signify its concurrence with the District's interpretation of the
Amended Wastewater Agreement, as stated above, by signing in the appropriate space
below. Upon receipt of this concurrence, the District will move forward with obtaining
Board authorization for the General Manager to execute the Amended and Restated
Regional Wastewater Disposal Agreement.
Mark Watton
General Manager
MW:jf
cc: John Helminski, Assistant Public Utilities Director, City of San Diego
~(Date)
P:IWORKING\CIP S1502 -City of San Diego Metro Water lssues\Pure Watet\Amended Agreement\02-09-19\Letter to the City of San D1ego 02-26-19 docx
60409.00001\30914102.16
AMENDED AND RESTATED
REGIONAL WASTEWATER DISPOSAL AGREEMENT
BETWEEN
THE CITY OF SAN DIEGO
AND
THE PARTICIPATING AGENCIES
IN
THE METROPOLITAN SEWERAGE SYSTEM
60409.00001\30914102.16
-i-
AMENDED AND RESTATED
REGIONAL WASTEWATER DISPOSAL AGREEMENT
TABLE OF CONTENTS
Page
I. DEFINITIONS ................................................................................................................... 2
II. OWNERSHIP AND OPERATION OF THE METRO SYSTEM .................................... 6
III. PAYMENT AND MONITORING PROVISIONS ......................................................... 12
IV. CAPACITY RIGHTS ...................................................................................................... 15
V. SYSTEM OF CHARGES ................................................................................................ 17
VI. PLANNING ..................................................................................................................... 21
VII. FACILITIES SOLELY FOR NEW CONTRACT CAPACITY ..................................... 22
VIII. THE METRO COMMISSION ........................................................................................ 24
IX. DISPUTE RESOLUTION ............................................................................................... 25
X. INSURANCE AND INDEMNITY ................................................................................. 26
XI. INTERRUPTION OF SERVICE ..................................................................................... 27
XII. NOTICES REQUIRED UNDER AGREEMENT ........................................................... 27
XIII. EFFECTIVE DATE AND TERMINATION .................................................................. 27
XIV. GENERAL ....................................................................................................................... 28
Exhibits
A. Metro Facilities
B. Contract Capacities
C. Administrative Protocol on Allocation of Operating Reserves and Debt Service Coverage
to Participating Agencies
D. Notice Listing
E. Reclaimed Water Distribution System
F. Pure Water Cost Allocation and Revenues
G. Pure Water Capital Billing Table
60409.00001\30914102.16 -1-
AMENDED AND RESTATED REGIONAL WASTEWATER DISPOSAL AGREEMENT
THIS AMENDED AND RESTATED REGIONAL WASTEWATER DISPOSAL
AGREEMENT is made and entered into this _____ day of _________________, 20___, by and
between the CITY OF SAN DIEGO, a municipal corporation (“the City”); and the CITY OF
CHULA VISTA, a municipal corporation; the CITY OF CORONADO, a municipal corporation;
the CITY OF DEL MAR, a municipal corporation; the CITY OF EL CAJON, a municipal
corporation; the CITY OF IMPERIAL BEACH, a municipal corporation; the CITY OF LA
MESA, a municipal corporation; the LEMON GROVE SANITATION DISTRICT, a political
subdivision of the State of California; the CITY OF NATIONAL CITY, a municipal corporation;
the CITY OF POWAY, a municipal corporation; the OTAY WATER DISTRICT, a political
subdivision of the State of California; the PADRE DAM MUNICIPAL WATER DISTRICT, a
political subdivision of the State of California; and the SAN DIEGO COUNTY SANITATION
DISTRICT, a political subdivision of the State of California (the “Participating Agencies”). The
City and the Participating Agencies may be referred to herein individually as a “Party,” and
collectively as the “Parties.”
RECITALS
WHEREAS, the City and the Participating Agencies (or their predecessors in interest)
entered into that certain Regional Wastewater Disposal Agreement dated May 18, 1998 (the
“1998 Agreement”), which provided, among other things, for certain contract rights to capacity
in the Metropolitan Sewerage System, a system of wastewater conveyance, treatment, and
disposal facilities (“Metro System”) and the establishment of a mechanism to fund the planning,
design, construction, operation, and maintenance of the Metro System by the City and the
Participating Agencies; and
WHEREAS, the purposes of the 1998 Agreement were: (1) to replace the prior-existing
sewage disposal agreements between the City and the Participating Agencies; (2) to provide
certain contract rights to capacity in the Metro System to the Participating Agencies; (3) to
establish a mechanism to fund the planning, design, construction, operation and maintenance of
the Metro System by the City and the Participating Agencies as necessary to provide hydraulic
capacity, and to comply with applicable law and with generally accepted engineering practices;
and (4) to establish a system of charges which allocates the costs of the planning, design and
construction of such new wastewater conveyance, treatment and disposal facilities as are
necessary solely to provide for new capacity on a fair and equitable basis; and
WHEREAS, on April 29, 2014 the San Diego City Council gave its approval and support
for the Pure Water San Diego program by adoption of Resolution No. R-308906. The
Resolution approved and supported the City’s efforts to develop an implementation strategy to
offload wastewater flow from the Point Loma Wastewater Treatment Plant through
implementation of potable reuse, resulting in effluent discharged to the Pacific Ocean being
equivalent to what would be achieved by upgrading the Point Loma Wastewater Treatment Plant
to a secondary treatment plant (secondary equivalency); and
WHEREAS, the City is implementing a phased, multi-year program designed to
regionally produce at least 83 million gallons per day of safe, reliable potable water using new,
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60409.00001\30914102.16
expanded, or modified facilities, some of which will include Metro System facilities, in order to
achieve secondary equivalency at the Point Loma Wastewater Treatment Plant; and
WHEREAS, the Pure Water Program will not only benefit the City by producing
repurified water, but also the Participating Agencies and their wastewater customers, especially
if secondary equivalency is recognized through federal legislation amending the Clean Water
Act. Specifically, implementation of the Pure Water Program will reduce wastewater discharges
to the Point Loma Wastewater Treatment Plant, part of the Metro System where a large portion
of the Participating Agencies’ wastewater is currently treated and disposed by discharging it into
the Pacific Ocean. By diverting wastewater from the Point Loma Wastewater Treatment Plant
and reducing the effluent discharged into the Pacific Ocean, the City and the Participating
Agencies will potentially avoid billions of dollars in unnecessary capital, financing, energy, and
operating costs to upgrade the Point Loma plant to secondary treatment at full capacity.
Avoiding such costs would result in significant savings for regional wastewater customers; and
WHEREAS, the Padre Dam Municipal Water District, the San Diego County Sanitation
District, and the City of El Cajon have proposed a program to produce up to 12 million gallons
per day of safe, reliable potable water for East San Diego County using wastewater that would
otherwise be disposed of in the Metro System (“East County AWP Program”). By offloading
wastewater and wastewater contents from the Point Loma Wastewater Treatment Plant, the East
County AWP Program would, if implemented, help the City’s and region’s efforts to achieve
long-term compliance with the Clean Water Act by producing a regional annual average of at
least 83 million gallons per day of water suitable for potable reuse by December 31, 2035, as
described in the Cooperative Agreement in Support of Pure Water San Diego entered into by the
City and certain environmental stakeholders on December 9, 2014; and
WHEREAS, Section XIV, subsection B, of the 1998 Agreement provided that the Parties
may amend the Agreement by a written agreement between the City and all Participating
Agencies stating the Parties’ intent to amend the Agreement; and
WHEREAS, in order to comprehensively and equitably address the costs and revenues
associated with the Pure Water Program and the related construction, expansion, and/or
modification of Metro System facilities, the City and Participating Agencies wish to amend and
restate the Regional Wastewater Disposal Agreement as provided herein.
THEREFORE, in consideration of the mutual promises set forth herein, the City and the
Participating Agencies agree as follows:
I.DEFINITIONS
A.Annual Average Daily Flow is the number, in millions of gallons of wastewater
per day (“MGD”), calculated by dividing total Flow on a fiscal year basis by 365
days.
B.Brine is a waste byproduct of the demineralization process at an upstream Water
Repurification System facility or a Reclaimed Water facility.
C.Capital Expense Rate is the cost per acre foot that will apply if the Metro
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60409.00001\30914102.16
System’s Capital Improvement Costs for the Pure Water Program and/or
upgrading of the Point Loma WTP to secondary treatment exceed $1.8 billion, as
further described in Exhibit F.
D.Capital Improvement Costs are costs associated with the planning, design,
financing, construction, or reconstruction of facilities.
E.Chemical Oxygen Demand or “COD” means the measure of the chemically
decomposable material in wastewater, as determined by the procedures specified
in the most current edition of “Standard Methods for the Examination for Water
and Wastewater,” or any successor publication which establishes the industry
standard.
F.City Water Utility PW Costs are those Pure Water Program costs allocated to
the City’s water utility and therefore excluded as Metro System costs under
Exhibit F.
G.Contract Capacity is the contractual right possessed by each Participating
Agency to discharge wastewater into the Metro System pursuant to this
Agreement up to the limit set forth in Exhibit B attached hereto. Contract
Capacity is stated in terms of Annual Average Daily Flow.
H.Flow is the amount of wastewater discharged by the City and each Participating
Agency.
I.Functional-Design Methodology shall mean the process of allocating Operation
and Maintenance Costs and Capital Improvement Costs to Flow and Strength
parameters recognizing the benefits of both the design criteria and the primary
function of a unit process.
J.Metro Commission is the advisory body created under Section VIII.
K.Metro System Costs are those costs set forth in Section 5.2.1.
L.Metro System Revenues are those revenues set forth in Section 5.2.2.
M.Metropolitan Sewerage System or Metro System shall mean and consist of
those facilities and contract rights to facilities which are shown and/or described
in Exhibit A attached hereto and incorporated by this reference, including any
amendments thereto authorized by this Agreement.
N.Municipal System shall mean the City’s wastewater collection system, which
consists of pipelines and pump stations, that collects wastewater within the City
of San Diego and conveys it to the Metropolitan Sewerage System for treatment
and disposal.
O.New Capacity is the capacity to discharge wastewater outside the Metro System,
above the Contract Capacity set forth in Exhibit B attached hereto.
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60409.00001\30914102.16
P.New Contract Capacity is the capacity to discharge wastewater into the Metro
System, above the Contract Capacity set forth in Exhibit B attached hereto.
Q.North City Water Reclamation Plant or North City WRP is the 30 million
gallons per day (as of the date of this Agreement) wastewater treatment facility
located at 4949 Eastgate Mall in San Diego, which includes four major processes:
primary treatment, secondary treatment, tertiary treatment, and disinfection.
R.Operation and Maintenance Costs are the costs of those items and activities
required by sound engineering and management practices to keep the conveyance,
disposal, treatment, and reuse facilities functioning in accordance with all
applicable laws, rules, and regulations.
S.Point Loma Wastewater Treatment Plant or Point Loma WTP is the 240
million gallons per day (as of the date of this Agreement) advanced primary
treatment plant which includes four major processes: screening, grit removal,
sedimentation, and digestion.
T.Projected 2050 Strength and Flow Amounts are the three (3) values described
below:
1.Projected COD 2050 Flows is the estimated amount of Chemical Oxygen
Demand (COD), stated in pounds per day, that the City and each
Participating Agency are projected to have in the 2050 fiscal year.
Projected COD 2050 Flows for each Party are stated in Column 7 of
Exhibit G.
2.Projected Metro Flow 2050 is the estimated amount of Annual Average
Daily Flow, stated in millions of gallons per day (MGD), that the City and
each Participating Agency are projected to have in the 2050 fiscal year.
Projected Metro Flow 2050 for each Party is stated in Column 4 of Exhibit
G.
3.Projected SS 2050 Flows is the estimated amount of Suspended Solids
(SS) stated in pounds per day, that the City and each Participating Agency
are projected to have in the 2050 fiscal year. Projected SS 2050 Flows for
each Party are stated in Column 10 of Exhibit G.
U.Pure Water Capital Melded Percentage or Melded Percentage is the
proportionate share, stated in Column 12 of Exhibit G, by which Pure Water
Program Capital Improvement Costs, Repurified Water Revenue, and the Capital
Expense Rate will be allocated among the City and the Participating Agencies.
The Pure Water Capital Melded Percentage is based on each Party’s proportionate
share of Projected Metro Flow 2050, Projected SS 2050 Flows, and Projected
COD 2050 Flows, which proportions are weighted as described in Footnote 3 of
Exhibit G.
V.Pure Water Program is the City’s phased, multi-year program designed to
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60409.00001\30914102.16
produce at least 83 million gallons per day of Repurified Water using new,
expanded, or modified facilities, some of which will include Metro System
facilities.
W.Reclaimed Water (or Recycled Water) shall have the definition set forth in
Title 22, Division 4 of the California Code of Regulations and shall mean water
which, as a result of treatment of wastewater, is suitable for a direct beneficial use
or a controlled use that otherwise could not occur.
X.Reclaimed Water (or Recycled Water) Distribution System shall mean and
consist of those eight (8) reclaimed water projects listed in Attachment B of the
Stipulated Final Order for Injunctive Relief approved by the U.S. District Court
on June 6, 1997 in U.S.A. v. City of San Diego, Case No. 88-1101-B, and attached
hereto as Exhibit E.
Y.Repurified Water shall mean water which, as a result of advanced treatment of
Reclaimed Water, is suitable for use as a source of domestic (or potable) water
supply.
Z.Repurified Water Revenue is the cost savings that will be realized when the
City water utility’s annual costs per-acre foot for Repurified Water are less than
the purchase costs per-acre foot for comparable water from the San Diego County
Water Authority, as further described in Exhibit F.
AA.Return Flow shall mean the effluent created by the dewatering of digested
biosolids, which includes centrate.
BB.Reuse shall mean to use again, such as water which has been reclaimed or
repurified, or sludge that has been converted to biosolids for beneficial use.
CC.South Bay Land/Ocean Outfall is the facility that is jointly owned by the
International Boundary & Water Commission (U.S. Section IBWC) and the City
of San Diego. The Outfall is planned to convey and discharge treated effluent
from the IBWC’s International Wastewater Treatment Plant and treated effluent
from the City’s South Bay Water Reclamation Plant and the South Bay Secondary
Treatment Plant. As of the date of this Agreement, the Outfall has a current
Average Daily Flow Capacity of 174 million gallons per day. As of the date of
this Agreement, the City owns 39.94% of the capacity of the Outfall and the
balance of the capacity is owned by the IBWC.
DD.South Bay Water Reclamation Plant is the 15 million gallons per day (as of the
date of this Agreement) wastewater treatment facility located at 2411 Dairy Mart
Road in San Diego, which includes four major processes: primary treatment,
secondary treatment, tertiary treatment, and disinfection.
EE.Strength means the measurement of Suspended Solids (SS) and Chemical
Oxygen Demand (COD) within the wastewater Flow and any other measurement
required by law after the date of this Agreement.
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60409.00001\30914102.16
FF.Suspended Solids or SS means the insoluble solid matter in wastewater that is
separable by laboratory filtration, as determined by the procedures specified in the
most current edition of “Standard Methods for the Examination of Water and
Wastewater,” or any successor publication which establishes the industry
standard.
GG.Tertiary Component is that portion of the wastewater treatment process that
currently filters the secondary treated wastewater effluent through fine sand
and/or anthracite coal to remove fine Suspended Solids and disinfects it to meet
the requirements of the California Administrative Code, Title 22, or its successor
for filtered and disinfected wastewater.
HH.Water Repurification System shall mean any facilities, including treatment and
conveyance facilities, the purpose of which is the production or conveyance of
Repurified Water. Water Repurification System includes, but is not limited to:
the Tertiary Component of the North City Water Reclamation Plant to the extent
being used to produce Repurified Water, the North City Pure Water Facility to be
located across the street from the North City Water Reclamation Plant (“North
City Pure Water Facility”); the Repurified Water conveyance system, which will
transport Repurified Water from the North City Pure Water Facility and/or other
facilities to the Miramar Reservoir or other alternative location(s) as determined
by the City; and any other Repurified Water treatment or conveyance facilities
which are part of the Pure Water Program.
II.OWNERSHIP AND OPERATION OF THE METRO SYSTEM
2.1 Rights of the Parties.
The City is the owner of the Metro System, and of any additions to the Metro
System or other facilities constructed pursuant to this Agreement. All decisions with respect to
the planning, design, construction, operation and maintenance of the Metro System shall rest
with the City, in consultation with the Metro Commission. The Participating Agencies shall have
a contractual right to use the Metro System and to participate in its operation as set forth in this
Agreement. Subject to the terms of this Agreement, and in conformance with all applicable laws,
the City may transfer ownership of all or part of the Metro System at any time. In the event of a
transfer, the City’s successor shall be bound by the terms of this Agreement. Subject to the
terms of this Agreement, any Participating Agency may transfer or assign its rights and
obligations under this Agreement. Any transfer shall first be approved by the City. No transfer
may occur if the City reasonably determines, after consultation with the Participating Agencies
involved, that the proposed transfer will imbalance, or will otherwise adversely impact the City’s
ability to operate the Metro System.
2.2 Metro System Services.
2.2.1 The City shall provide wastewater conveyance, treatment and disposal
services to the Participating Agencies through the Metro System, under
the terms set forth in this Agreement.
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2.2.2 The City shall operate the Metro System in an efficient and economical
manner, maintaining it in good repair and working order, all in accordance
with recognized sound engineering and management practices.
2.2.3 The City shall convey, treat, and dispose of or reuse all wastewater
received under this Agreement in such a manner as to comply with all
applicable laws, rules and regulations.
2.3 Flow Commitment.
2.3.1 Absent agreement of the Parties, all Flow from the Participating Agencies
and the City, up to the capacity limits set forth in Exhibit B or any
amendments thereto, shall remain in the Metro System.
2.3.2 This Agreement shall not preclude any Participating Agency from
diverting Flow from the Metro System as a result of the construction of
reclamation facilities or New Capacity outside of the Metro System.
2.3.3 Any Participating Agency may negotiate an agreement with the City to
withdraw all Flow from the Metro System, which shall provide that the
Agency pay its proportionate share of Capital Improvement Costs.
If a Participating Agency enters into an agreement with the City by
December 31, 2019, to withdraw all Flow from the Metro System by
January 1, 2035, such Participating Agency shall not pay Pure Water
Program Capital Improvement Costs attributable to the Metro System
except for Phase I (as defined below in Section 2.8).
2.4 Funding Obligations.
Nothing in this Section or in this Agreement shall obligate the City to make any
payment for the acquisition, construction, maintenance or operation of the Metro System from
moneys derived from taxes or from any income and revenue of the City other than moneys in or
sewer revenues which go into the Sewer Revenue Fund for the Metro System and from
construction funds derived from the sale of such sewer revenue bonds for the Metro System as
are duly authorized. Nothing in this Agreement shall be construed to obligate the City to pay
from its annual income and revenues any sum which would create an indebtedness, obligation or
liability within the meaning of the provisions of Section 18 of Article XVI of the Constitution of
the State of California. Nothing in this Section, however, or in this Agreement shall prevent the
City, in its discretion, from using tax revenues or any other available revenues or funds of the
City for any purpose for which the City is empowered to expend moneys under this Agreement.
Nothing herein shall relieve the City from its obligations to fund and carry out this Agreement.
Nothing in this Section or in this Agreement shall obligate any Participating Agency to make any
payment which would create an indebtedness, obligation or liability within the meaning of the
provisions of Section 18 of Article XVI of the Constitution of the State of California, or which is
not authorized by law.
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60409.00001\30914102.16
2.5 Financial Statements.
2.5.1 The City shall keep appropriate records and accounts of all costs and
expenses relating to conveyance, treatment, disposal, and reuse of
wastewater, and production of Repurified Water, and the acquisition,
planning, design, construction, administration, monitoring, operation and
maintenance of the Metro System and Water Repurification System, and
any grants, loans, or other revenues received therefor. The City shall keep
such records and accounts for at least four (4) years, or for any longer
period required by law or outside funding sources.
2.5.2 Said records and accounts shall be subject to reasonable inspection by any
authorized representative of any Participating Agency at its expense.
Further, said accounts and records shall be audited annually by an
independent certified public accounting firm appointed by the City
pursuant to generally accepted accounting principles. A copy of said
report shall be available to any Participating Agency. As part of said
audit, the actual amount of City Water Utility’s PW Costs, Pure Water
Program costs attributable to the Metro System, Repurified Water
Revenue, and the Capital Expense Rate shall be determined and audited by
the City’s external auditors and Participating Agency representatives, and
a cumulative and annual summary of such amounts shall be included as a
footnote or attachment to the audit of the Metro System. Cost summaries
shall include separate lines for Capital Improvement Costs and Operation
and Maintenance Costs.
2.5.3 The City shall make a good faith effort to complete the annual audit, and
any related adjustments under this Agreement, by the end of the following
fiscal year.
2.6 Limitations on Types and Condition of Wastewater.
2.6.1 Each Participating Agency will comply with all applicable laws, rules and
regulations including its regulatory obligations associated with the
discharge of wastewater into its respective system and from such system
into the Metro System.
2.6.2 Each Participating Agency will minimize to the maximum extent
practicable, the infiltration and inflow of surface, ground or stormwaters
into its respective wastewater systems.
2.6.3 Each Participating Agency will insure that all industrial users of its
wastewater system are regulated by an effective industrial pretreatment
program that conforms to all to all applicable laws, rules and regulations
and that is acceptable to the City. Provided, however, that the City shall
not require the Participating Agencies to take any actions beyond that
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which is required under applicable laws, rules and regulations that can be
taken but are not being taken by the City.
2.6.4 The City and the Participating Agencies agree that nothing in this
Agreement, including the termination of the existing sewage disposal
agreements, shall affect the validity of the Interjurisdictional Pretreatment
Agreements, or the separate transportation agreements that are currently in
effect between or among the City and the Participating Agencies.
2.6.5 Each Participating Agency will not discharge a substantial amount of
sewage originating outside its respective boundaries into the Metro
System without the approval of the City.
2.6.6 Each Participating Agency shall be responsible for the violation of any
applicable laws, rules or regulations associated with its respective
discharge of wastewater into the Metro System. Nothing in this
Agreement shall affect the ability of any Participating Agency to hold
third parties responsible for such violations.
2.6.7 In the event a regulatory agency imposes any penalty or takes other
enforcement action relating to the conveyance, treatment, or disposal of
wastewater in or from the Metro System, the City shall determine if the
City or a Participating Agency or Agencies caused or contributed to the
violation by exceeding its Contract Capacity or by the contents of its
wastewater. The City shall allocate the penalty or other relief, including
the costs of defense, to the Party or Parties responsible. Each responsible
Party, whether a Participating Agency or the City, shall be obligated to
pay its share of such penalty or other relief, and any costs of defense. In
the event that the City cannot make such an allocation, the cost of such
penalty or other relief shall be shared by the Participating Agencies and
the City proportionately based on Flow and Strength.
2.7 Right of First Refusal.
2.7.1 The City shall not sell or agree to sell the Metro System without first
offering it to the Participating Agencies. For the purposes of this section,
“Participating Agencies” shall mean a Participating Agency, a group of
Participating Agencies, or a third party representing one or more
Participating Agencies. The term “sell” shall include any transfer or
conveyance of the Metro System or of any individual treatment or
reclamation facility or outfall within the Metro System.
2.7.2 The City and the Participating Agencies recognize that transfer of
ownership of the Metro System is currently restricted by Sections 6.04 and
6.20 of the Installment Purchase Agreement between the City and the
Public Facilities Financing Authority of the City, which inter alia restricts
the transfer of ownership to the Metropolitan Wastewater Sewage District
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or other governmental agency whose primary purpose is to provide
wastewater treatment. The City shall not seek to impose on bond holders
a waiver of Section 6.04 or 6.20. Absent such a restriction, before the City
sells or agrees to sell the Metro System, or any portion of it, the City shall
offer to sell the Metro System to the Participating Agencies (the “Offer”)
on the terms and at a price equal to that proposed for the sale of the Metro
System to a third party. The Participating Agencies shall have thirty days
from receipt of the Offer (the “Intent to Respond Period”) in which to
notify the City of their intent to respond to the Offer. The Participating
Agencies shall have five months from the expiration of the Intent to
Respond Period in which to accept or reject the Offer. The Offer shall
contain the name of the proposed purchaser, the proposed sale price, the
terms of payment, the required deposit, the time and place for the close of
escrow, and any other material terms and conditions on which the sale is
to be consummated.
2.7.3 If the Participating Agencies give timely notice of their intent to respond
and timely notice of their acceptance of the Offer, then the City shall be
obligated to sell and the Participating Agencies shall be obligated to
purchase the Metro System or any individual treatment or reclamation
facility or outfall within the Metro System, as applicable, at the price and
on the terms and conditions of the Offer. If the Participating Agencies do
not give timely notice of their intent to respond or their acceptance of the
Offer, or do not submit an offer on the same terms and conditions as the
Offer, the City may, following the end of the Offer period, sell the Metro
System, or any portion of it, at a price and on terms and conditions no less
favorable to the City than those in the Offer. The City shall not sell the
Metro System to any third party on terms or at a price less favorable to the
City from the terms and price contained in the Offer absent compliance
with the terms of this Section.
2.7.4 Nothing herein shall prevent the City from entering into a financing
agreement which may impose limits on the City’s power to sell the Metro
System to the Participating Agencies pursuant to Section 2.7.1. if the City
reasonably believes that such a financing agreement is in the City’s best
interest. Neither the entry into such a financing agreement by the City nor
the performance thereof by the City shall constitute a breach or default by
the City hereunder.
2.8 Pure Water San Diego Program.
2.8.1 Each new, expanded, or modified Metro System facility which is used in
relation to the production of Repurified Water (in addition to the
modification and expansion of the North City Water Reclamation Facility)
shall be governed by this Agreement and Exhibit F, attached hereto and
incorporated herein.
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2.8.2 The allocation of Pure Water Program costs pursuant to this Agreement
shall be retroactive through the fiscal year ending June 30, 2014, when
Pure Water Program costs were first incurred by the Metro System. When
conducting the year-end adjustments for the fiscal year in which this
Agreement takes effect, the City shall credit or assess such prior costs to
the Parties pursuant to this Agreement.
2.9 Future Negotiations and Cooperation.
2.9.1 This Agreement and Exhibit F specifically contemplate Phase I of the Pure
Water Program, which consists of new, expanded, or modified Metro
System facilities and Water Repurification System facilities designed to
produce only up to 30 million gallons per day of Repurified Water (“Phase
I”). Within one year of the Effective Date of this Agreement, the Parties
intend to meet and negotiate in good faith regarding one or more
amendments to this Agreement or its Exhibits to address:
2.9.1.1 The allocation of specific Pure Water Program costs between
City’s water utility and the Metro System for such later phases;
2.9.1.2 Alternative billing methodologies for Metro System costs;
2.9.1.3 The exclusion of costs related to the industrial discharges
inspection and monitoring program within San Diego under
Section 5.2.1.2.3 of the Agreement;
2.9.1.4 The inclusion of costs for regional, non-Metro System potable
reuse projects in calculating the Capital Expense Rate;
2.9.1.5 A sample calculation of Repurified Water Revenue; and
2.9.1.6 The conveyance and treatment of wastewater generated at United
States military bases under this Agreement.
If such negotiations do not result in an amendment to this Agreement or its
Exhibits concerning these subjects, this Agreement shall remain in full
force and effect as set forth herein. Further, if the City proceeds with a
later phase of the Pure Water Program as authorized under Section 2.1 of
this Agreement, and the Parties have not yet amended this Agreement or
Exhibit F to specifically address such costs by the time they are incurred,
all costs listed in Section I of Exhibit F shall nonetheless be excluded as
Metro System costs under this Agreement.
2.9.2 The City and the Participating Agencies shall cooperate, coordinate, and
negotiate in good faith with the Padre Dam Municipal Water District, San
Diego County Sanitation District, and City of El Cajon on issues that
relate to the East County AWP Program, including, but not limited to, the
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potential transfer of the Mission Gorge Pump Station; disposal of
residuals; and a source control program.
2.9.3 Following the Effective Date of this Agreement, the Parties intend to meet
and negotiate in good faith regarding the disposal, treatment, and/or
management of residuals (solids, brine, and centrate) produced at any new
non-Metro System secondary, tertiary, or advanced wastewater treatment
facilities upstream of any Metro System facilities related to the production
of Repurified Water that currently exist or may exist in the future. Such
negotiations may result in an amendment to this Agreement, or in one or
more separate agreements between the City and the involved Participating
Agencies, regarding the disposal, treatment, and/or management of
residuals at such non-Metro System facilities.
2.9.3.1 In the event that an amendment to this Agreement, or a separate
agreement between the City and the involved Participating
Agencies, regarding the disposal, treatment, and/or management of
residuals at such non-Metro System facilities, cannot be achieved
through direct negotiation, the parties shall use the dispute
resolution process in Article IX of this Agreement.
2.9.3.2 Absent an amendment to this Agreement or a separate Agreement
between the City and involved Participating Agencies as described
above, the involved Participating Agencies shall not dispose of
residuals from new non-Metro System secondary, tertiary, or
advanced wastewater treatment facilities at any point upstream of a
Metro System facility related to the production of Repurified
Water that currently exists or may exist in the future.
III. PAYMENT AND MONITORING PROVISIONS
3.1 Payment for Metro System Facilities.
Through the system of charges set forth in Article V of this Agreement, each
Participating Agency shall pay its share of the costs of planning, design and construction of all of
the Metro System facilities which are identified in Exhibit A hereto, which is incorporated herein
by reference.
3.2 Payment for Additional Metro System Facilities.
Through the system of charges set forth in Article V of this Agreement, each
Participating Agency shall pay its share of the costs of acquisition, or planning, design and
construction of such facilities in addition to those set forth on Exhibit A as are necessary for the
Metro System to maintain compliance with applicable laws, rules and regulations, including the
Ocean Pollution Reduction Act of 1994 and its successor(s), present and future waivers of
applicable treatment standards at any Metro System treatment facility, and all facilities as are
necessary to convey, treat, dispose, and reuse wastewater in the Metro System to provide the
Contract Capacity set forth in Exhibit B, to maintain hydraulic capacity and as otherwise
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required by sound engineering principles. As a ministerial matter, the City shall amend Exhibit A
from time to time to reflect such additional facilities and shall give notice of any amendments to
the Participating Agencies. The City shall keep an updated version of Exhibit A on file with the
City Public Utilities Department. Exhibit A may be amended to reflect other changes to the
Metro System only as expressly provided in this Agreement.
3.3 Payment for Operation and Maintenance.
Through the system of charges set forth in Article V of this Agreement, each
Participating Agency shall pay its share of the Operation and Maintenance Costs of all Metro
System facilities. The Participating Agencies shall not pay for the Operation and Maintenance
Costs of Water Repurification System, which are City Water Utility PW Costs.
3.4 Charges Based on Flow and Strength; Exception.
3.4.1 Except as otherwise described in this Section 3.4, a Participating Agency’s
share of the charges in this Article III shall be assessed pursuant to Article
V of this Agreement based on its proportionate Flow in the Metro System
and the Strength of its wastewater.
3.4.2 Notwithstanding section 3.4.1, or any other provision of this Agreement, a
Participating Agency’s share of Pure Water Program Capital Improvement
Costs, Repurified Water Revenue, and Capital Expense Rate attributable
to the Metro System under Exhibit F shall be assessed or credited based on
the Parties’ proportionate share of the Pure Water Capital Melded
Percentage stated in Column 12 of Exhibit G. The City shall annually
allocate the estimated and actual Pure Water Program Capital
Improvement Costs and revenues which are attributable to the Metro
System under Exhibit F in proportion to each Party’s Pure Water Capital
Melded Percentage when estimating quarterly payments and conducting
year-end adjustments under Article V.
3.4.3 Each Party recognizes that operation within respective Projected 2050
Strength and Flow Amounts is essential to the accurate allocation of costs
and revenues under the Pure Water Program. In recognition of same, the
Parties agree as follows:
3.4.3.1 Beginning in the next fiscal year after the effective date of this
Agreement, if a Party’s Annual Average Daily Flow, annual
average pounds per day of COD, or annual average pounds per day
of SS exceeds any one of its Party’s Projected 2050 Strength and
Flow Amounts by more than ten percent (10%) for any three (3)
consecutive fiscal years, the City shall prepare an amendment to
Exhibit G that adjusts projections of each Party’s Projected 2050
Strength and Flow Amounts based on information about such
Party’s exceedance and other relevant information using sound
engineering principles. Upon approval by the City and two-thirds
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of the members of the Metro Commission, the City shall, as a
ministerial matter, amend Exhibit G (including the Melded
Percentages in Column 12 of Exhibit G) to reflect the new
Projected 2050 Strength and Flow Amounts for each Party. The
City shall keep an updated version of Exhibit G on file with the
City Public Utilities Department. If the City and two-thirds of the
Metro Commission cannot agree on an amendment to Exhibit G,
the matter shall be submitted to dispute resolution pursuant to
Article IX.
3.4.3.2 Notwithstanding the amounts set forth in Columns 4, 7, and 10 of
Exhibit G, the following Parties will be deemed to have the
following Projected 2050 Strength and Flow Amounts until July 1,
2025:
3.4.3.2.1 Padre Dam: 3.2 MGD Flow; 24,730 lb/day COD;
11,900 lb/day SS
3.4.3.2.2 San Diego County Sanitation District: 13.617 MGD
Flow; 70,210 lb/day COD; 27,830 lb/day SS
3.4.3.2.3 El Cajon: 7.8 MGD Flow; 41,848 lb/day COD; 16,556
lb/day SS
3.4.3.3 If Exhibit G is amended to update one or more Parties’ Projected
2050 Strength and Flow Amounts, the change in Projected 2050
Strength and Flow Amounts and Pure Water Capital Melded
Percentages shall be retroactive in effect, and the City shall use the
updated amounts in estimating quarterly payments and conducting
year-end adjustments for Pure Water Program costs and revenues.
Therefore, any Party that underpaid based on prior Pure Water
Capital Melded Percentages (which were based on prior Projected
2050 Strength and Flow Amounts) shall pay the retroactive amount
due in its quarterly payments the following fiscal year; any Party
that overpaid based on previous Pure Water Capital Melded
Percentages shall receive a credit in its quarterly payments the
following fiscal year. Notwithstanding the preceding sentence, if
the retroactive amount due exceeds 20% of a Party’s average
annual Metro System payments for the previous four (4) years,
such Party may elect to pay the retroactive amount due in its
quarterly payments over the subsequent four (4) fiscal years, with
interest based on the most recent quarterly earnings rate of the
Local Agency Investment Fund’s Pooled Money Investment
Account; any Party that overpaid based on previous Pure Water
Capital Melded Percentages shall receive a credit in its quarterly
payments the following four (4) fiscal years.
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3.4.3.4 If a Participating Agency (other than those specified in Section
3.4.3.2) intends to divert a portion of its Flow from the Metro
System pursuant to Section 2.3.2 on or before July 1, 2025, the
Participating Agency may provide written notice to the City by
December 31, 2019, requesting an adjustment in its Projected 2050
Strength and Flow Amounts and Melded Percentage in Exhibit G.
If such notice is timely provided, the City shall prepare an
amendment to Exhibit G based on information about such Party’s
diversion and other relevant information using sound engineering
principles. Such amendment shall then be subject to the approval
procedures set forth in Section 3.4.3.1, and the retroactivity
provisions set forth in Section 3.4.3.3; provided, however, that
such an amendment to Exhibit G shall also be subject to an
agreement with the City for the Participating Agency to pay its
proportionate share of Pure Water Program planning, design, and
construction costs incurred to date by the Metro System (based on
such Participating Agency’s prior Melded Percentage), and any
costs for Pure Water Program planning or design changes which
are reasonably necessary due to the intended diversion.
3.5 Monitoring Flow and Strength.
3.5.1 The City shall monitor wastewater that is discharged into the Metro
System for Flow and Strength. The City shall own and operate as part of
the Metro System monitoring devices which will measure the amount of
daily wastewater discharged into the Metro System. These devices shall be
installed at locations appropriate to accurately monitor Flow and Strength.
The City may also monitor wastewater Flow and Strength at other
locations as it deems appropriate.
3.5.2 In measuring Strength, the frequency and nature of the monitoring shall
not be more stringent for the Participating Agencies than it is for the City.
3.5.3 The City shall, at least once every five (5) years, update and provide its
plans for the monitoring system and for the procedures it will use to
determine Strength to the Participating Agencies. The Participating
Agencies shall have the opportunity to review and comment prior to
implementation.
3.5.4 The City shall report Flow and Strength data to the Participating Agencies
at least quarterly.
IV.CAPACITY RIGHTS
4.1 Contract Capacity.
In consideration of the obligations in this Agreement, each Participating Agency
shall have a contractual right to discharge wastewater to the Metro System up to the Contract
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Capacity set forth in Exhibit B. Each Party’s Projected Metro Flow 2050 stated in Exhibit G, is
used solely for the purpose of allocating the Metro System’s Pure Water Program Capital
Improvement Costs, Repurified Water Revenue, and the Capital Expense Rate under this
Agreement, and does not replace or limit Contract Capacity.
4.2 Transfers of Contract Capacity.
The Participating Agencies and the City may buy, sell or exchange all or part of
their Contract Capacity among themselves on such terms as they may agree upon. The City shall
be notified prior to any transfer. Any transfer shall be first approved by the City. No Contract
Capacity may be transferred if the City determines, after consultation with the Participating
Agencies involved in the transaction, that said transfer will unbalance, or will otherwise
adversely impact the City’s ability to operate the Metro System. Provided, however, that the
Participating Agency seeking the transfer may offer to cure such imbalance at its own expense.
Following the City’s consent, as a ministerial matter, the Contract Capacity set forth in Exhibit B
shall be adjusted to reflect the approved transfer. If necessary, Projected Metro Flow 2050 set
forth in Exhibit G shall also be adjusted to reflect the approved transfer using the process set
forth in Section 3.4.3.1, provided, however, that an amendment to Exhibit G due to an approved
transfer shall not be retroactive in effect pursuant to Section 3.4.3.3.
4.3 Allocation of Additional Capacity.
The Parties recognize that the City’s applicable permits for the Metro System may
be modified to create capacity in the Metro System beyond that set forth in Exhibit B as a result
of the construction of additional facilities or as a result of regulatory action. This additional
capacity shall be allocated as follows:
4.3.1 Except as provided in section 4.3.2 below, in the event that the Metro
System is rerated so that additional permitted capacity is created, said
capacity shall be allocated proportionately based upon the Metro System
charges that have been paid since July 1, 1995 to the date of rerating.
4.3.2 In the event that the additional permitted capacity is created as the result
of the construction of non-Metro System facilities, or as the result of the
construction of facilities pursuant to Article VII, such additional capacity
shall be allocated proportionately based on the payments made to plan,
design and construct such facilities.
4.4 Deductions in Contract Capacity.
The Parties further recognize that the Contract Capacity in Exhibit B and
Projected Metro Flow 2050 in Exhibit G may be modified to comply with, or in response to,
applicable permit conditions, or related regulatory action, or sound engineering principles. In the
event that the capacity of the Metro System is rerated to a level below the total capacity set forth
in Exhibit B, the Contract Capacity in Exhibit B and Projected Metro Flow 2050 in Exhibit G
shall be reallocated proportionately pending the acquisition or construction of new facilities. The
City shall acquire or construct such facilities as necessary to provide the Contract Capacity rights
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set forth in Exhibit B, as planning and capacity needs require. The costs of such facilities shall be
assessed pursuant to Section 3.2.
4.5 Amendments to Exhibits B and G.
As a ministerial matter, the City shall prepare amendments to Exhibits B and G to
reflect any adjustment in Contract Capacity pursuant to this Article within ninety (90) days after
the adjustment is made. The City shall give notice of the amendments to each Participating
Agency, and shall provide copies of the amendments with the notice. The City shall keep an
updated version of Exhibits B and G on file with the City Public Utilities Department.
4.6 The South Bay Land/Ocean Outfall.
Nothing in this Article shall limit the City’s right to transfer capacity service
rights in that portion of the South Bay Land/Ocean Outfall which is not part of the Metro
System.
V. SYSTEM OF CHARGES
5.1 Charges Authorized.
The City agrees to implement and the Participating Agencies agree to abide by a
new system of charges. This new system allows the City to equitably recover from all
Participating Agencies their proportional share of the net Metro System Costs through the
imposition of the following charges:
5.1.1 SSC (Sewer System Charge);
5.1.2 NCCC (New Contract Capacity Charge).
5.2 SSC (Sewer System Charge).
The City shall determine the SSC based on the projected Metro System Costs (as
defined below) for the forthcoming fiscal year, less all Metro System Revenues (as defined
below).
5.2.1 Metro System Costs
5.2.1.1 The following shall at a minimum be considered Metro System
Costs for purposes of calculating the annual SSC:
5.2.1.1.1 Except as provided in section 5.2.1.2 (Excluded Costs),
the annual costs associated with administration,
operation, maintenance, replacement, annual debt
service costs and other periodic financing costs and
charges, capital improvement, insurance premiums,
claims payments and claims administration costs of the
Metro System, including projected overhead. Overhead
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shall be calculated using accepted accounting practices
to reflect the overhead costs of the Metro System.
5.2.1.1.2 Fines or penalties imposed on the City as a result of the
operation of the Metro System, unless the fine/penalty
is allocated to the City or a Participating Agency as
provided in Section 2.6.7.
5.2.1.2 Excluded Costs. The following items shall not be considered
Metro System Costs for purposes of calculating the annual SSC:
5.2.1.2.1 Costs related to the City of San Diego’s Municipal
System as determined by reasonable calculations;
5.2.1.2.2 Costs related to the treatment of sewage from any
agency which is not a party to this Agreement;
5.2.1.2.3 Costs related to the inspection and monitoring program
for the industrial dischargers located in San Diego,
including associated administrative and laboratory
services;
5.2.1.2.4 Right-of-way charges for the use of public streets of the
City or any Participating Agency. The City and the
Participating Agencies agree not to impose a right-of-
way charge for the use of its public rights-of-way for
Metro System purposes;
5.2.1.2.5 Capital Improvement Costs of any non-Metro System
facility;
5.2.1.2.6 Capital Improvement Costs for which an NCCC is paid;
and
5.2.1.2.7 City Water Utility PW Costs.
5.2.2 Metro System Revenues.
5.2.2.1 The following revenues shall be at a minimum considered Metro
System Revenues for purposes of determining the annual SSC:
5.2.2.1.1 Any grant or loan receipts or any other receipts that are
attributable to the Metro System, including, but not
limited to, all compensation or receipts from the sale,
lease, or other conveyance or transfer of any asset of
the Metro System; provided, however, that this shall not
include any grant, loan, or other receipts attributable to
the Metro System components of the Pure Water
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Program, which are specifically addressed in Section
5.2.2.1.8.
5.2.2.1.2 All compensation or receipts from the sale or other
conveyance or transfer of any Metro System by-
products, including, but not limited to gas, electrical
energy, sludge products, and Reclaimed Water
(excepting therefrom any receipts allocated pursuant to
section 5.2.2.1.3).
5.2.2.1.3 The distribution of revenue from the sale of Reclaimed
Water from the North City Water Reclamation Plant,
including incentives for the sale of Reclaimed Water,
shall first be used to pay for the cost of the Reclaimed
Water Distribution System, then the cost of the
Operation and Maintenance of the Tertiary Component
of the North City Water Reclamation Plant that can be
allocated to the production of Reclaimed Water, and
then to the Metro System.
5.2.2.1.4 Any portion of an NCCC that constitutes
reimbursement of costs pursuant to Section 7.1.4.
5.2.2.1.5 Any penalties paid under Section 7.3.
5.2.2.1.6 Proceeds from the Capital Expense Rate, as calculated
under Exhibit F and allocated among the City and
Participating Agencies in the proportions set forth in
Column 12 of Exhibit G.
5.2.2.1.7 Those portions of Repurified Water Revenue
attributable to the Metro System, as calculated under
Exhibit F and allocated among the Participating
Agencies in the proportions set forth in Column 12 of
Exhibit G.
5.2.2.1.8 Any grant or loan receipts or any other receipts that are
attributable to the Metro System components of the
Pure Water Program, including, but not limited to, all
compensation or receipts from the sale, lease, or other
conveyance or transfer of any asset of the Metro
System components of the Pure Water Program. Any
proceeds under this section shall be allocated among the
City and the Participating Agencies in the proportions
set forth in Column 12 of Exhibit G.
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5.2.2.2 Excluded Revenue
5.2.2.2.1 Capital Improvement Costs for which an NCCC is paid;
5.2.2.2.2 Proceeds from the issuance of debt for Metro System
projects.
5.2.2.2.3 Proceeds from the sale of Reclaimed Water used to pay
for the Reclaimed Water Distribution System pursuant
to section 5.2.2.1.3 above.
5.2.3 Calculation of SSC Rates.
5.2.3.1 Prior to the initial implementation of the new system of charges,
the City shall prepare a sample fiscal year estimate setting forth the
methodology and sampling data used as a base for Strength based
billing (SBB) which includes Flow and Strength (Chemical
Oxygen Demand (COD) and Suspended Solids (SS)). The analysis
shall be submitted to each Participating Agency.
5.2.3.2 The City shall determine the unit SSC rates by allocating net costs
(Metro System Costs less Metro System Revenues) between
parameters of Flow, COD and SS. This allocation is based on the
approved Functional-Design Methodology analyses for individual
Capital Improvement Projects (CIPs) and estimated Operation and
Maintenance (O&M) Costs allocated to the three parameters. The
City may revise the calculations to include any other measurement
required by law after the effective date of this Agreement.
5.2.3.3 The net cost allocated to each of the three parameters (Flow, COD
and SS) shall be divided by the total Metro System quantity for
that parameter to determine the unit rates for Flow, COD and SS.
These unit rates shall apply uniformly to all Participating
Agencies.
5.2.4 Estimate and Billing Schedule and Year End Adjustment
5.2.4.1 The City shall estimate the SSC rates on an annual basis prior to
January 15. The City shall quantify the SSC rates by estimating the
quantity of Flow, COD and SS for each Party, based on that
Party’s actual flow and the cumulative data of sampling for COD
and SS over the preceding years. If cumulative data is no longer
indicative of discharge from a Participating Agency due to the
implementation of methods to reduce Strength, previous higher
readings may be eliminated.
5.2.4.2 Costs of treating Return Flow for solids handling will be allocated
to the Participating Agencies in proportion to their Flow and
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Strength. Return Flow will not be counted against the Participating
Agencies’ Contract Capacity as shown in Exhibit B.
5.2.4.3 The City shall bill the Participating Agencies quarterly, invoicing
on August 1 , November 1, February 1 and May 1. Each bill shall
be paid within thirty (30) days of mailing. Quarterly payments will
consist of the total estimated cost for each Participating Agency,
based on their estimated Flow, COD and SS, divided by four.
5.2.4.4 At the end of each fiscal year, the City shall determine the actual
Metro System Costs and the actual Flow as well as the cumulative
Strength data for the City and each of the Participating Agencies.
The City shall make any necessary adjustments to the unit rates for
Flow, COD and SS based on actual costs for the year. The City
shall then recalculate the SSC for the year using actual costs for the
year, actual Flow, and cumulative Strength factors (COD, SS and
Return Flow) for the City and for each Participating Agency. The
City shall credit any future charges or bill for any additional
amounts due, the quarter after the prior year costs have been
audited.
5.3 NCCC (New Contract Capacity Charge).
If New Contract Capacity is required or requested by a Participating Agency,
pursuant to Article VII, the Metro System shall provide the needed or requested capacity,
provided that the Participating Agency agrees to pay an NCCC in the amount required to provide
the New Contract Capacity. New Contract Capacity shall be provided pursuant to Article VII.
5.4 Debt Financing.
The City retains the sole right to determine the timing and amount of debt
financing required to provide Metro System Facilities.
5.5 Allocation of Operating Reserves and Debt Service Coverage.
The Parties shall continue to comply with the 2010 Administrative Protocol on
Allocation of Operating Reserves and Debt Service Coverage to Participating Agencies, attached
hereto and incorporated herein as Exhibit C.
VI.PLANNING
6.1 Projected Flow and Capacity Report.
Commencing on July 1, 1999, each Participating Agency shall provide the City
and the Metro Commission with a ten-year projection of its Flow and capacity requirements from
the Metro System. The Agencies shall disclose any plans to acquire New Capacity outside the
Metro System. This “Projected Flow and Capacity Report” shall be updated annually.
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6.2 Other Planning Information.
Each Participating Agency shall provide the City with such additional information
as requested by the City as necessary for Metro System planning purposes.
6.3 Ten-Year Capital Improvement Plan.
The City shall prepare a Ten-Year Capital Improvement Plan for the Metro
System that describes the facilities necessary to convey, treat, and dispose of, or reuse all Flow in
the Metro System in compliance with all applicable rules, laws and regulations. The plan shall be
updated annually.
6.4 Notice to Metro Commission.
In the event that the City is not able to include a facility in the Ten-Year Capital
Improvement Plan, the City shall notify the Metro Commission as soon as possible before the
detailed design or construction of such facility provided that the facility will significantly impact
the Metro System.
VII.FACILITIES SOLELY FOR NEW CONTRACT CAPACITY
The Participating Agencies and City are obligated to pay for the acquisition or
planning, design, and construction of new facilities in the Metro System that are needed solely to
provide New Contract Capacity only under the terms provided below.
7.1 Determination of Need for New Contract Capacity.
7.1.1 As part of its planning efforts, and considering the planning information
provided to the City by the Participating Agencies, the City shall
determine when additional facilities beyond those acquired or constructed
pursuant to Article III above will be necessary solely to accommodate a
need for New Contract Capacity in the Metro System, whether by the City
or by the Participating Agencies. The City shall determine: (1) the amount
of New Contract Capacity needed; (2) the Participating Agency or
Agencies, or the City, as the case may be, in need of the New Contract
Capacity; (3) the type and location of any capital improvements necessary
to provide the New Contract Capacity; (4) the projected costs of any
necessary capital improvements; and, (5) the allocation of the cost of any
such facilities to the Participating Agency and/or the City for which any
New Contract Capacity is being developed. The City shall notify the
Participating Agencies of its determination within sixty days of making
such determination.
7.1.2 The City or Participating Agency or Agencies in need of New Contract
Capacity as determined by the City pursuant to section 7.1.1 above, may
choose, in their sole discretion, to obtain New Capacity outside of. the
Metro System in lieu of New Contract Capacity. Under such
circumstances, the Participating Agency or Agencies shall commit to the
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City in writing their intent to obtain such New Capacity. Upon such
commitment, the City shall not be required to provide New Contract
Capacity to such Agency or Agencies as otherwise required under this
Agreement.
7.1.3 The Participating Agencies shall have six months from the date of notice
of the determination within which to comment on or challenge all or part
of the City’s determination regarding New Contract Capacity, or to agree
thereto or to commit, in writing, to obtain New Capacity outside of the
Metro System. Any Participating Agency objecting to the City’s
determination shall have the burden to commence and diligently pursue
the formal dispute resolution procedures of this Agreement within said six
month period. The City’s determination shall become final at the close of
the six month comment and objection period. The City’s determination
shall remain valid notwithstanding commencement of dispute resolution
unless and until otherwise agreed to pursuant to the dispute resolution
process in Article IX, or pursuant to a final court order.
7.1.4 The City and the Participating Agency or Agencies which need New
Contract Capacity shall thereafter enter into an agreement specifying the
terms and conditions pursuant to which the New Contract Capacity will be
provided, including the amount of capacity and the New Contract
Capacity. Each Party obtaining New Contract Capacity shall reimburse the
Metro System for the costs of acquisition, planning, design, and
construction of facilities necessary to provide the New Contract Capacity
that have been paid by other Parties under Section 7.2.3.
7.1.5 The Parties recognize that the City may acquire and plan, design and
construct facilities that are authorized pursuant to both Article III and
Article VII of this Agreement. Under such circumstances, the City shall
allocate the costs and capacity of such facilities pursuant to Article III and
Section 7.1.1 as applicable.
7.2 Charges for Facilities Providing New Contract Capacity
7.2.1 The expense of acquisition, planning, design, and construction of New
Contract Capacity shall be borne by the City or the Participating Agency
or Agencies in need of such New Contract Capacity.
7.2.2 Notwithstanding any provision in this Agreement, the City and the
Participating Agencies shall pay for the Operation and Maintenance Costs
of all facilities pursuant to the payment provisions of Article III, including
those facilities acquired and constructed to provide New Contract
Capacity in the Metro System.
7.2.3 Charges for the acquisition, planning, design and construction of facilities
solely to provide New Contract Capacity shall be paid for by the
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Participating Agencies and the City pursuant to the payment provisions in
Article III of this Agreement until an agreement is reached under Section
7.1.4. or pending the resolution of any dispute relating to the City’s
determination with respect to New Contract Capacity.
7.2.4 As a ministerial matter, the City shall prepare amendments to Exhibits A
and B to reflect the acquisition or construction of facilities to provide New
Contract Capacity pursuant to this Article. The City shall give notice of
the Amendments to the Participating Agencies, and shall provide copies of
the Amendments with the notice.
7.3 Liquidated Damages.
7.3.1 The Parties recognize that appropriate capacity and long term planning
for same are essential to the proper provision of sewerage service. In
recognition of same, the Parties agree that discharge beyond Contract
Capacity will result in damages that are difficult to determine. Therefore,
the damages are being liquidated in an amount estimated to the actual
damage that will be incurred by the City, and is not a penalty. In the
event that a Participating Agency exceeds its Contract Capacity after the
City has given notice that New Capacity is required, said Participating
Agency shall be assessed and pay a liquidated damages until such time
as the Participating Agency obtains the required New Capacity. The
liquidated damages shall be one dollar ($1) for each gallon of Flow
which exceeds the Participating Agency’s Contract Capacity for each
quarter in which any exceedance occurs. The amount of liquidated
damages shall be adjusted each fiscal year to reflect the annual
percentage change in the Engineering News Record – Los Angeles
construction cost index.
7.3.2 In the event that a Participating Agency fails to pay the charges imposed
under this Article after the City has given notice that payment is
required, said Participating Agency shall be assessed and shall pay
liquidated damages which shall be determined by multiplying the most
recent quarterly earnings rate of the Local Agency Investment Fund’s
Pooled Money Investment Account times the total outstanding charges.
The Participating Agency shall pay such liquidated damages each quarter
until the outstanding charges are paid in full.
VIII.THE METRO COMMISSION
8.1 Membership.
The Metro Commission shall consist of one representative from each Participating
Agency. Each Participating Agency shall have the right to appoint a representative of its choice
to the Metro Commission. If a Participating Agency is a dependent district whose governing
body is that of another independent public agency that Participating Agency shall be represented
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on the Metro Commission by a representative appointed by the governing body which shall have
no more than one representative no matter how many Participating Agencies it governs. Each
member has one vote in any matter considered by the Metro Commission. The Metro
Commission shall establish its own meeting schedule and rules of conduct. The City may
participate in the Metro Commission on an ex officio, non-voting basis.
8.2 Advisory Responsibilities of Metro Commission.
8.2.1 The Metro Commission shall act as an advisory body, advising the City on
matters affecting the Metro System. The City shall present the position of
the majority of the Metro Commission to the City’s governing body in
written staff reports. The Metro Commission may prepare and submit
materials in advance and may appear at any hearings on Metro System
matters and present its majority position to the governing body of the City.
8.2.2 The Metro Commission may advise the City of its position on any issue
relevant to the Metro System.
IX.DISPUTE RESOLUTION
This Section governs all disputes arising out of this Agreement.
9.1 Mandatory Non-Binding Mediation.
If a dispute arises among the Parties relating to or arising from a Party’s
obligations under this Agreement that cannot be resolved through informal discussions and
meetings, the Parties involved in the dispute shall first endeavor to settle the dispute in an
amicable manner, using mandatory non-binding mediation under the rules of JAMS, AAA, or
any other neutral organization agreed upon by the Parties before having recourse in a court of
law. Mediation shall be commenced by sending a Notice of Demand for Mediation to the other
Party or Parties to the dispute. A copy of the notice shall be sent to the City, all other
Participating Agencies, and the Metro Commission.
9.2 Selection of Mediator.
A single mediator that is acceptable to the Parties involved in the dispute shall be
used to mediate the dispute. The mediator will be knowledgeable in the subject matter of this
Agreement, if possible, and chosen from lists furnished by JAMS, AAA, or any other agreed
upon mediator.
9.3 Mediation Expenses.
The expenses of witnesses for either side shall be paid by the Party producing
such witnesses. All mediation costs, including required traveling and other expenses of the
mediator, and the cost of any proofs or expert advice produced at the direct request of the
mediator, shall be Metro System costs.
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9.4 Conduct of Mediation.
Mediation hearings will be conducted in an informal manner. Discovery shall not
be allowed. The discussions, statements, writings and admissions and any offers to compromise
during the proceedings will be confidential to the proceedings (pursuant to California Evidence
Code Sections 1115 – 1128 and 1152) and will not be used for any other purpose unless
otherwise agreed by the parties in writing. The parties may agree to exchange any information
they deem necessary. The parties involved in the dispute shall have representatives attend the
mediation who are authorized to settle the dispute, though a recommendation of settlement may
be subject to the approval of each agency’s boards or legislative bodies. Either Party may have
attorneys, witnesses or experts present.
9.5 Mediation Results.
Any resultant agreements from mediation shall be documented in writing. The
results of the mediation shall not be final or binding unless otherwise agreed to in writing by the
parties. Mediators shall not be subject to any subpoena or liability and their actions shall not be
subject to discovery.
9.6 Performance Required During Dispute.
Nothing in this Article shall relieve the City and the Participating Agencies from
performing their obligations under this Agreement. The City and the Participating Agencies shall
be required to comply with this Agreement, including the performance of all disputed activity
and disputed payments, pending the resolution of any dispute under this Agreement.
9.7 Offers to Compromise
Any offers to compromise before or after mediation proceedings will not be used
to prove a party’s liability for loss or damage unless otherwise agreed by the parties in writing
(pursuant to Evidence Code Section 1152.)
X.INSURANCE AND INDEMNITY
10.1 City Shall Maintain All Required Insurance.
10.1.1 Throughout the term of this Agreement the City shall procure and
maintain in effect liability insurance covering Metro System assets and
operations in the same manner, and to the same extent, as the City insures
similar assets and operations of the City. Such insurance may be provided
through separate policies for the Metro System, or by consolidating the
Metro System with other City assets and operations for insurance
purposes. If the Metro System is insured separately, policy limits,
deductibles, and self-insured retentions shall be equivalent to what the
City procures for other similar City assets and operations. The City shall
maintain all insurance required by law, including workers’ compensation
insurance, and may self-insure for certain losses when allowed by law.
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The proportionate cost of insurance for the Metro System shall be
included in the computation of the SSC.
10.1.2 If the Metro System is insured separately, any policy or policies of
liability insurance carried by the City for the Metro System shall name the
Participating Agencies as additional insureds with evidence of same
supplied to each upon request.
10.1.3 Upon request by the Metro Commission or a Participating Agency, the
City shall promptly provide written coverage and policy information,
including, but not limited to, the scope of coverage, policy limits,
deductibles, and self-insured retentions, including information on any
claims made against the policies and remaining limits and deductibles.
10.2 Substantially Equivalent Coverage.
In the event of a transfer of the Metro System to a nonpublic entity pursuant to
Article II, coverage substantially equivalent to all the above provisions shall be maintained by
any successor in interest.
XI.INTERRUPTION OF SERVICE
Should the Metro System services to the Participating Agencies be interrupted as a result
of a major disaster, by operation of federal or state law, or other causes beyond the City’s
control, the Participating Agencies shall continue all payments required under this Agreement
during the period of the interruption.
XII.NOTICES REQUIRED UNDER AGREEMENT
The City and each Participating Agency shall give notice when required by this
Agreement. All notices must be in writing and either served personally, or mailed by certified
mail. The notices shall be sent to the officer listed for each Party, at the address listed for each
Party in Exhibit D in accordance with this Article. If a Party wishes to change the officer and/or
address to which notices are given, the Party shall notify all other Parties in accordance with this
Article. Upon such notice, as a ministerial matter, the City shall amend Exhibit D to reflect the
changes. The amendment shall be made within thirty (30) days after the change occurs. The City
shall keep an updated version of Exhibit D on file with the City Public Utilities Department. The
City shall provide a copy of the amended Exhibit D to all Parties.
XIII.EFFECTIVE DATE AND EXPIRATION
13.1 Effective Date.
This Agreement shall be effective thirty (30) days after execution by the City and
all of the Participating Agencies, and shall be dated as of the signature date of the last executing
Party.
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13.2 Expiration.
Subject to the rights and obligations set forth in Section 13.4, this Agreement
shall expire on December 31, 2065. This Agreement is subject to extension by agreement of the
Parties. The Parties shall commence discussions on an agreement to provide wastewater
treatment services beyond the year 2065 on or before December 31, 2055, or at such time, if any,
that the Point Loma WTP is required to be upgraded to secondary treatment.
13.3 Contract Capacity Rights Survive Expiration.
The Participating Agencies’ right to obtain wastewater treatment services from
the facilities referred to in, or constructed pursuant to this Agreement shall survive the expiration
of the Agreement. Provided however, upon expiration of this Agreement, the Participating
Agencies shall be required to pay their proportional share based on Flow and Strength of all
Metro System Costs (Capital Improvement Costs and Operation and Maintenance) to maintain
their right to such treatment services. Provided further, that in the event that the Participating
Agencies exercise their rights to treatment upon expiration of this Agreement, the City shall have
the absolute right, without consultation, to manage, operate and expand the Metro System in its
discretion.
13.4 Capital Expense Rate Beyond Expiration.
The Capital Expense Rate, as further described in Exhibit F, shall continue until
the cost difference between (a) the actual sum of Pure Water Program Capital Improvement
Costs and associated debt attributable to the Metro System under Exhibit F and/or the costs to
upgrade the Point Loma WTP and (b) $1.8 billion (as adjusted for inflation), has been fully paid,
or the Agreement expires, whichever is sooner. Notwithstanding, it is the express intent and
desire of the City and the Participating Agencies that if the Agreement expires before the cost
difference has been paid through the Capital Expense Rate, that the Capital Expense Rate
continue in any extension of this Agreement negotiated by the Parties pursuant to Section 13.2
until the cost difference has been fully paid.
13.5 Abandonment.
After December 31, 2065, the City may abandon the Metro System upon delivery
of notice to the Participating Agencies ten (10) years in advance of said abandonment. Upon
notice by the City to abandon the Metro System, the Parties shall meet and confer over the nature
and conditions of such abandonment. In the event the Parties cannot reach agreement, the matter
shall be submitted to mediation under Article IX. In the event of abandonment, the City shall
retain ownership of all Metro System assets free of any claim of the Participating Agencies.
XIV.GENERAL
14.1 Exhibits.
1.This Agreement references Exhibits A through G. Each exhibit is attached
to this Agreement, and is incorporated herein by reference. The exhibits are as follows:
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Exhibit A Metro Facilities;
Exhibit B Contract Capacities;
Exhibit C Administrative Protocol on Allocation of Operating
Reserves and Debt Service Coverage to Participating
Agencies;
Exhibit D Notice Listing;
Exhibit E Reclaimed Water Distribution System;
Exhibit F Pure Water Cost Allocation and Revenues; and
Exhibit G Pure Water Capital Billing Table
14.2 Amendment of Agreement.
Except as provided in this Agreement, and recognizing that certain amendments
are ministerial and preapproved, this Agreement may be amended or supplemented only by a
written agreement between the City and the Participating Agencies stating the Parties’ intent to
amend or supplement the Agreement.
14.3 Construction of Agreement.
14.3.1 Drafting of Agreement
It is acknowledged that the City and the Participating Agencies, with the
assistance of competent counsel, have participated in the drafting of this
Agreement and that any ambiguity should not be construed for or against
the City or any Participating Agency on account of such drafting.
14.3.2 Entire Agreement
The City and each Participating Agency represent, warrant and agree that
no promise or agreement not expressed herein has been made to them, that
this Agreement contains the entire agreement between the Parties, that this
Agreement supersedes any and all prior agreements or understandings
between the Parties unless otherwise provided herein, and that the terms of
this Agreement are contractual and not a mere recital; that in executing
this Agreement, no Party is relying on any statement or representation
made by the other Party, or the other Party’s representatives concerning
the subject matter, basis or effect of this Agreement other than as set forth
herein; and that each Party is relying solely on its own judgement and
knowledge.
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14.3.3 Agreement Binding on All; No Third Party Beneficiaries
This Agreement shall be binding upon and shall inure to the benefit of
each of the Parties, and each of their respective successors, assigns,
trustees or receivers. All the covenants contained in this Agreement are for
the express benefit of each and all such Parties. This Agreement is not
intended to benefit any third parties, and any such third party beneficiaries
are expressly disclaimed.
14.3.4 Severability
14.3.4.1 Should any provision of this Agreement be held invalid or
illegal, such invalidity or illegality shall not invalidate the whole of this
Agreement, but, rather, the Agreement shall be construed as if it did not
contain the invalid or illegal part, and the rights and obligations of the
Parties shall be construed and enforced accordingly except to the extent
that enforcement of this Agreement without the invalidated provision
would materially and adversely frustrate either the City’s or a Participating
Agency’s essential objectives set forth in this Agreement.
14.3.4.2 Should a court determine that one or more components of the
allocation of costs set forth in this Agreement places the City or a
Participating Agency in violation of Article XIII D, Section 6 of the
California Constitution with respect to their ratepayers, such components
shall no longer be of force or effect. In such an event, the City and the
Participating Agencies shall promptly meet to renegotiate the violative
component of the cost allocation to comply with Article XIII D, Section 6
of the California Constitution, and use the dispute resolution process in
Article IX of this Agreement if an agreement cannot be reached through
direct negotiation.
14.3.4.3 Should a state or federal agency provide a final, written
determination that the method of allocating Pure Water Program Capital
Improvement Costs under this Agreement violates the requirements of
state or federal grants or loans which are, or will be, used to fund the
wastewater components of the Pure Water Program, such allocation
method will no longer be of any force or effect. In such an event, the
Parties agree that the allocation of Pure Water Program Capital
Improvement Costs attributable to the Metro System will be based on
Strength and Flow as set forth in Section 3.4.1, and the allocation of
Repurified Water Revenue and the Capital Expense Rate will be based on
the Parties’ actual payments to fund the Pure Water Program Capital
Improvement Costs attributable to the Metro System. The City and the
Participating Agencies shall also promptly meet to negotiate an alternative
cost allocation method that would comply with such grant or loan funding
requirements.
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14.3.5 Choice of Law
This Agreement shall be construed and enforced pursuant to the laws of
the State of California.
14.3.6 Recognition of San Diego Sanitation District as Successor to Certain
Parties.
The Parties hereby acknowledge and agree that the San Diego County
Sanitation District is a Participating Agency under this Agreement as the
successor in interest to the Alpine Sanitation District, East Otay Mesa
Sewer Maintenance District, Lakeside Sanitation District, Spring Valley
Sanitation District, and Winter Gardens Sewer Maintenance District.
14.4 Declarations Re: Agreement.
14.4.1 Understanding of Intent and Effect of Agreement
The Parties expressly declare and represent that they have read the
Agreement and that they have consulted with their respective counsel
regarding the meaning of the terms and conditions contained herein. The
Parties further expressly declare and represent that they fully understand
the content and effect of this Agreement and they approve and accept the
terms and conditions contained herein, and that this Agreement is
executed freely and voluntarily.
14.4.2 Warranty Regarding Obligation and Authority to Enter Into This
Agreement
Each Party represents and warrants that its respective obligations herein
are legal and binding obligations of such Party, that each Party is fully
authorized to enter into this Agreement, and that the person signing this
Agreement hereinafter for each Party has been duly authorized to sign this
Agreement on behalf of said Party.
14.5 Restrictions on Veto of Transfers and Acquisitions of Capacity
Each Party understands and agrees that this Agreement governs its
respective rights and responsibilities with respect to the subject matter hereto and specifically
recognizes that with respect to the transfer and acquisition of Contract Capacity (Section 4.2) or
the creation of New Contract Capacity for any Participating Agency (Article VII), no
Participating Agency has a right to veto or prevent the transfer of capacity by and among other
Participating Agencies or with the City, or to veto or prevent the creation or acquisition of
capacity for another Participating Agency or Agencies, recognizing that by signing this
Agreement each Participating Agency has expressly preapproved such actions. The sole right of
a Participating Agency to object to any of the foregoing shall be through expression of its
opinion to the Metro Commission and, where applicable, through exercise of its rights under the
dispute resolution provisions of this Agreement.
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14.6 Right to Make Other Agreements
Nothing in this Agreement limits or restricts the right of the City or the
Participating Agencies to make separate agreements among themselves without the need to
amend this Agreement, provided that such agreements are consistent with this Agreement.
Nothing in this Agreement or Exhibit F limits or restricts the right of the City or the Participating
Agencies to enter into separate agreements for the purchase or sale of Repurified Water produced
by the Water Repurification System or sharing in City Water Utility PW Costs. Such agreements
shall not affect the cost allocation and Metro System revenues delineated in Exhibit F.
14.7 Limitation of Claims
Notwithstanding any longer statute of limitations in State law, for
purposes of any claims asserted by the City or a Participating Agency for refunds of
overpayments or collection of undercharges arising under this Agreement, the Parties agree that
such refunds or collections shall not accrue for more than four years prior to the date that notice
of such claim is received by the City or a Participating Agency. This also applies to any related
adjustments to each Participating Agency’s share of net Metro System costs or revenues
resulting from the resolution of such claims. The City and the Participating Agencies hereby
waive any applicable statute of limitations available under State law that exceed four years. In
no case shall the limitations period stated in this section begin to accrue until the date that the
annual audit and year-end adjustment from which the claim arises are complete.
14.8 Counterparts
This Agreement may be executed in counterparts. This Agreement shall
become operative as soon as one counterpart hereof has been executed by each Party. The
counterparts so executed shall constitute one Agreement notwithstanding that the signatures of
all parties do not appear on the same page.
SIGNATURES ON FOLLOWING PAGES
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IN WITNESS WHEREOF, the Parties have executed this Amendment and Restated Regional
Wastewater Disposal Agreement as of the date first set forth above.
CITY OF CHULA VISTA Approved as to Form:
Name: Name:
Title: Title:
CITY OF CORONADO Approved as to Form:
Name: Name:
Title: Title:
CITY OF DEL MAR Approved as to Form:
Name: Name:
Title: Title:
CITY OF EL CAJON Approved as to Form:
Name: Name:
Title: Title:
CITY OF IMPERIAL BEACH Approved as to Form:
Name: Name:
Title: Title:
CITY OF LA MESA Approved as to Form:
Name: Name:
Title: Title:
LEMON GROVE SANITATION
DISTRICT
Approved as to Form:
Name: Name:
Title: Title:
CITY OF NATIONAL CITY Approved as to Form:
Name: Name:
Title: Title:
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OTAY WATER DISTRICT Approved as to Form:
Name: Name:
Title: Title:
PADRE DAM MUNICIPAL WATER
DISTRICT
Approved as to Form:
Name: Name:
Title: Title:
CITY OF POWAY Approved as to Form:
Name: Name:
Title: Title:
CITY OF SAN DIEGO Approved as to Form:
Name: Name:
Title: Title:
SAN DIEGO COUNTY SANITATION
DISTRICT
Approved as to Form:
Name: Name:
Title: Title:
EXHIBIT A
60409.00001\30914102.16
EXHIBIT A
METRO FACILITIES AS OF 6/27/18
Existing Facilities
Pt. Loma Wastewater Treatment Plant
Pt. Loma Ocean Outfall
Pump Station #1
Pump Station #2
South Metro Interceptor
North Metro Interceptor
Metro Force Mains 1 & 2
Digested Sludge Pipeline
North City Water Reclamation Plant
Metro Biosolids Center (NCWR Plant Related Facilities)
North City Tunnel Connector
North City Raw Sludge Pipeline
Centrate Pipeline
Rose Canyon Parallel Trunk Sewer
Second Rose Canyon Trunk Sewer
East Mission Bay Trunk Sewer
Morena Blvd. Interceptor
South Bay Water Reclamation Plant
Dairy Mart Road & Bridge Rehab
Grove Avenue Pump Station
Grove Avenue Pump Station Sewer Pipeline
South Bay Raw Sludge Pipeline
South Bay Land/Ocean Outfall1
Environmental Monitoring & Technical Services Laboratory
Centrate Treatment Facility at Metropolitan Biosolids Center
Metro Operations Center (Iv10C) Complex (based on annual facilities allocation)
Additional Metro Facilities
Note: The below listed facilities could be required as part of the Metro System for
hydraulic capacity, good engineering practices and/or compliance with applicable law,
rules or regulations, including OPRA, and the continuation of the City's waiver of
applicable treatment standards at the Point Loma Wastewater Treatment Plant
("Waiver").
South Bay Sludge Processing Facility
1 The South Bay Land/Ocean Outfall is jointly owned by the International Boundary and Water Commission, U.S.
Section (60.06%) and the City of San Diego (39.94%). The capacity of the City’s portion of the outfall as of the
date of this Agreement is 74 MGD average dry weather flow, of which the Metro System has a capacity right to 69.2
MGD and the City as an exclusive right to 4.8 MGD.
EXHIBIT A
60409.00001\30914102.16
South Bay Secondary Treatment Plant, Phase I (21 MGD)
South Bay Secondary Sewers, Phase I
Note: These facilities could be required as part of the Metro System for hydraulic
capacity, good engineering practices, compliance with OPRA, and to maintain the City's
Waiver. In the event that hydraulic capacity demands, or the obligations of OPRA (or its
successor) or the terms of the City's Waiver change, these facilities may not be required
or may be modified or supplemented, as appropriate, pursuant to the terms of this
Agreement.
South Bay Secondary Treatment Plant, Phase II (28 MGD)
South Bay Secondary Sewers, Phase II
Note: These facilities could be added to the Metro System as part of Phase I of the Pure
Water Program.
Expansion of North City Water Reclamation Plant
Morena Pump Station
EXHIBIT B
60409.00001\30914102.16
EXHIBIT B
CONTRACT CAPACITIES
Annual Average Daily Flow in Millions of Gallons Per Day
Metro Agency
Original
Contract
Capacity
Additional
Contract
Capacity
New
Contract
Capacity
Transferred
Contract
Capacity
Total
Contract
Capacity
Percent
of
Total
Chula Vista 19.843 1.021 0.000 0.000 20.864 8.182%
Coronado 3.078 0.172 0.000 0.000 3.250 1.275%
Del Mar 0.821 0.055 0.000 0.000 0.876 0.344%
East Otay Mesa*0.000 0.000 0.000 1.000 1.000 0.392%
El Cajon 10.260 0.655 0.000 0.000 10.915 4.280%
Imperial Beach 3.591 0.164 0.000 0.000 3.755 1.473%
La Mesa 6.464 0.359 0.000 0.170 6.993 2.742%
Lakeside-Alpine*4.586 0.255 0.000 0.000 4.841 1.898%
Lemon Grove 2.873 0.154 0.000 0.000 3.027 1.187%
National City 7.141 0.346 0.000 0.000 7.487 2.936%
Otay 1.231 0.056 0.000 0.000 1.287 0.505%
Padre Dam 6.382 0.343 0.000 (0.500) 6.225 2.441%
Poway 5.130 0.264 0.000 0.500 5.894 2.312%
Spring Valley/
Otay Ranch* 10.978 0.545 0.000 (1.170) 10 .353 4.060%
Wintergardens*1.241 0.068 0.000 0.000 1.309 0.513%
Subtotal 83.619 4.459 0.000 0.000 88.078 34.540%
EXHIBIT B
60409.00001\30914102.16
Metro
Agency
Original
Contract
Capacity
Additional
Contract
Capacity1
New
Contract
Capacity2
Transferred
Contract
Capacity3
Total
Contract
Capacity
Percent
of
Total
San Diego 156.381 10.541 0.000 0.000 166.922 65.460%
Total 240.000 15.000 0.000 0.000 255.000 100.00%
* Indicates a sub-area of the San Diego County Sanitation District.
1.Additional Contract Capacity is capacity allocated pursuant to Section 4.3.1 of the Agreement.
2.New Contract Capacity is capacity obtained pursuant to Section 6 of the Agreement.
3.Transferred Contract Capacity is capacity obtained pursuant to Section 4.2 of the Agreement.
EXHIBIT C
60409.00001\30914102.16
EXHIBIT C
ADMINISTRATIVE PROTOCOL ON ALLOCATION OF OPERATING RESERVES
AND DEBT SERVICE COVERAGE TO PARTICIPATING AGENCIES
EXHIBIT D
60409.00001\30914102.16
EXHIBIT D
NOTICE LISTING
City Manager
City of Chula Vista
276 Fourth Avenue
Chula Vista, CA 91919
Phone: (619) 691-5031
Fax: (619) 585-5612
City Manager
City of La Mesa
8130 Allison Avenue
La Mesa, CA 91942
Phone: (619) 667-1101
Fax: (619) 462-7528
Chief Operating Officer
City of San Diego
202 “C” Street
San Diego, CA 92101
Phone: (619) 236-5949
Fax: (619) 236-6067
City Manager
City of Coronado
1825 Strand Way
Coronado, CA 92113
Phone: (619) 522-7335
Fax: (619) 522-7846
City Manager
City of Lemon Grove
3232 Main Street
Lemon Grove, CA 91945
Phone: (619) 464-6934
Fax: (619) 460-3716
Chief Administrative Officer
County of San Diego
1600 Pacific Highway, Rm. 209
San Diego, CA 92101
Phone: (619) 531-5250
Fax: (619) 557-4060
City Manager
City of Del Mar
1050 Camino Del Mar
Del Mar, CA 92014
Phone: 755-9313 ext. 25
Fax: 755-2794
City Manager
City of National City
1243 National City Blvd.
National City, CA 91950
Phone: (619) 336-4240
Fax: (619) 336-4327
General Manager
Otay Water District
2554 Sweetwater Springs Blvd.
Spring Valley, CA 91977
Phone: (619) 670-2210
Fax: (619) 670-2258
City Manager
City of El Cajon
200 Civic Center Way
El Cajon, CA 92020
Phone: (619) 441-1716
Fax: (619) 441-1770
City Manager
City of Poway
13325 Civic Center Drive
Poway, CA 92064
Phone: (858) 679-4200
Fax: (858) 679-4226
General Manager
Padre Dam Municipal Water
District
9300 Fanita Pkwy
Santee, CA 92071
Phone: (619) 258-4610
Fax: (619) 258-4794
City Manager
City of Imperial Beach
825 Imperial Beach Blvd.
Imperial Beach, CA 91932
Phone: (619) 423-8300 ext. 7
Fax: (619) 429-9770
EXHIBIT E
60409.00001\30914102.16
EXHIBIT E
RECLAIMED WATER DISTRIBUTION SYSTEM
October 23, 2018 Version
60409.00001\30398144.16
EXHIBIT F
PURE WATER PROGRAM COST ALLOCATION AND REVENUES
As part of the Pure Water Program, the City intends to modify the North City Water
Reclamation Plant (a Metro System facility) and expand its capacity to 52 mgd. In addition, the
City intends to construct the North City Pure Water Facility on a nearby site to produce
Repurified Water. This Exhibit F sets forth the costs and revenues associated with the Pure
Water Program which are, or are not, attributable to the Metro System.
I.Costs Excluded from Metro System Costs
All of the following Pure Water Program costs, including Capital Improvement Costs,
Operation and Maintenance Costs, and other related costs (including administration, insurance,
claims, and overhead) are excluded as Metro System Costs for purposes of calculating the annual
Sewer System Charge, and shall be the responsibility of City’s water utility (“City Water Utility
PW Costs”), unless otherwise expressly agreed to pursuant to an amendment to this Exhibit F:
1.1 General Exclusions.
1.1.1 Costs of the Water Repurification System and any Metro System facilities
to the extent constructed, modified, expanded, or used for the purpose of treating water beyond
secondary treatment (ocean discharge standard under current law). This shall include costs for
preliminary treatment, primary treatment, and secondary treatment to the extent such costs are
higher than they would otherwise be due to the production of Repurified Water.
1.1.2 Costs for fail-safe disposal, if necessary, for design capacity for Repurified
Water, including, but not limited to, any costs associated with the reservation of capacity at the
Point Loma Wastewater Treatment Plant.
1.1.3 Costs for the demolition or replacement of existing Metro System facilities
with similar facilities for the purpose of making space available for Water Repurification System
facilities. Such costs may take into account the current asset value or market value of the
existing Metro System facility.
1.2 Cost Exclusions Specific to North City Water Reclamation Plant
Improvements.
1.2.1 Costs for increased aeration tank volume to the extent the new volume
exceeds the amount necessary to provide 52 mgd capacity. Determination of sizing to provide
52 mgd capacity shall be based on the current tank volume necessary to provide 30 mgd
capacity.
1.2.2 Costs for the methanol feed system.
1.2.3 Costs for brine disposal, including, but not limited to, pump stations,
pipelines, retreatment, ocean outfall, and monitoring.
60409.00001\30398144.16 2
1.2.4 Costs for the use of existing tertiary water filters for Repurified Water
purposes. Such costs may take into account the depreciated value of such filters, or use such
other appropriate valuation method as agreed by the City and authorized representatives of the
Metro Commission. (Costs under this section shall be reimbursed or credited by City’s water
utility to the Metro System.)
II.North City Water Reclamation Plant Improvement Costs Included as Metro System
Costs
Notwithstanding the above exclusions, the City and the Participating Agencies have
specifically agreed that the following Capital Improvement Costs and Operation and
Maintenance Costs related to North City Water Reclamation Plant improvements shall be
included as Metro System Costs for purposes of calculating the annual Sewer System Charge
(and therefore not qualify as City Water Utility PW Costs):
2.1 Costs for chemically enhanced primary treatment for up to 52 mgd capacity.
2.2 Costs for primary effluent equalization for up to 52 mgd capacity.
2.3 Costs for increased volume of aeration tanks that will provide up to, but not
exceeding, 52 mgd capacity. Determination of sizing to provide 52 mgd capacity shall be based
on the current tank volume necessary to provide 30 mgd capacity.
2.4 Costs to add secondary clarifier tanks sufficient for up to 52 mgd capacity.
2.5 Costs for wastewater conveyance facilities to provide wastewater for replacement
of centrate flows that cannot be treated at the North City Water Reclamation Plant due to the
production of Repurified Water.
2.6 Costs for treatment and conveyance of all return flows (micro-filtration and
tertiary backwash) based on Flow, COD, and SS.
III.Cost Allocation Example
Attachment 1 is an example of the City’s Pure Water Phase I Cost Estimate (based on
60% design), and indicates which costs are City Water Utility PW Costs and which costs are
attributable to the Metro System. The Parties agree that Attachment 1 is an illustrative document
to assist the Parties in the future and is not a comprehensive list of all such costs. If there is any
conflict between this Exhibit F and Attachment 1, or if a specific cost is not addressed in
Attachment 1, this Exhibit F shall control.
IV.Revenue Sharing for Repurified Water
4.1 Background. Initially, the parties anticipate that the cost per acre foot associated
with the production of Repurified Water will be more expensive than the cost per acre foot of
untreated imported water. However, it is anticipated that Repurified Water produced under the
Pure Water Program will be less expensive than untreated imported water sometime in the
future. Once Repurified Water produced under the Pure Water Program becomes less expensive
60409.00001\30398144.16 3
than the cost of untreated imported water, the parties agree that there will be revenue from the
Pure Water Program.
4.2 Calculation. Revenue sharing shall occur in each fiscal year during which the
annual cost per acre foot associated with the production of Repurified Water is less than the cost
of untreated water per acre foot from the San Diego County Water Authority (“CWA”). The
annual cost difference shall be known as “Repurified Water Revenue.” Repurified Water
Revenue shall be determined as follows:
Attachment 2 is a summary of billings from CWA showing fixed and variable costs for
untreated water. The Parties agree that Attachment 2 shall be referred to by the Parties in the
future in determining how costs for water delivered at Miramar Reservoir are calculated. If no
untreated water is delivered at Miramar Reservoir in a given year, then the closest point of
delivery of untreated water to the City shall be used.
The City shall estimate whether there will be Repurified Water Revenue in the upcoming
fiscal year prior to January 15 of each year, and the estimated amount of Repurified Water
Revenue shall be effective on July 1 of the upcoming fiscal year.
4.3 Revenue Sharing. Repurified Water Revenue shall initially be shared based on
the relative actual Capital Improvement Costs for the Pure Water Program contributed by City’s
Water Utility and the Metro System. Such Capital Improvement Cost contributions are currently
estimated as (61% City Water Utility and 39% Metro System) until the debt attributable to the
Metro System is fully paid.
Following full payment of debt attributable to the Metro System, Repurified Water
Revenue shall be shared based on the relative actual Operation and Maintenance Costs for Pure
Water Program facilities contributed by City’s Water Utility and the Metro System, calculated
Annual cost per acre foot of CWA untreated water
purchased by the City for delivery at Miramar Reservoir (which
shall be determined based on the total of certain fixed and variable
costs for water actually billed to the City by CWA for water
delivered at Miramar Reservoir in a fiscal year, divided by the
number of acre-feet of CWA water delivered at Miramar Reservoir
that year)
less
Annual cost per acre foot of City Water Utility PW Costs
(which shall be determined based on total annual City Water
Utility PW Costs divided by the number of acre-feet of Repurified
Water actually produced in that year)
multiplied by
The number of acre feet of Repurified Water produced by
Pure Water Program facilities during the applicable fiscal year.
60409.00001\30398144.16 4
annually. Such Operation and Maintenance Costs are currently estimated as (76% City Water
Utility and 24% Metro System) on an annual basis.
4.4 Year-End Adjustment. At the end of each fiscal year during which there is
Repurified Water Revenue, the City shall determine the actual cost per acre foot of CWA
untreated water purchased by the City, the actual cost per acre foot of City Water Utility PW
costs, and the actual amount of Repurified Water produced at Pure Water Program facilities.
Based on the actual cost and production information, the City will recalculate the
Repurified Water Revenue for the prior fiscal year. The City will credit any future charges or
bill for any additional amounts due the quarter after the prior year costs have been audited.
4.5 Change in Potable Reuse Method. The parties acknowledge that the Pure Water
Program will initially use the surface water augmentation method of potable reuse. The use of
CWA untreated water costs in calculating Repurified Water Revenue is intended to provide an
appropriate point of comparison to costs for producing Repurified Water that will be introduced
into surface water. The parties agree that if the City implements direct potable reuse (in which
Repurified Water is introduced directly into a water supply pipeline or facility), the parties shall
meet and negotiate in good faith regarding an amendment to this Exhibit F to appropriately
update the formula for Repurified Water Revenue.
V.Capital Expense Rate
5.1 Background. The Point Loma Wastewater Treatment Plant operates under a
National Pollutant Discharge Elimination System (“NPDES”) permit modified under section
301(h) & (j)(5) of the Clean Water Act. If such modified permit were ever revoked or not
renewed, the parties agree that, under current law, the City would have an obligation to upgrade
the Point Loma WTP to secondary treatment. The parties further agree that $1.8 billion is a fair
and comprehensive estimation of the costs that could be incurred by the Metro System to meet
the legal requirements related to the Metro System under current law. The estimate of $1.8
billion is based on the net present value of the capital cost to develop 180 MGD of secondary
treatment at Point Loma WTP as of November 15, 2018.
Therefore, the parties agree that $1.8 billion represents the maximum amount of Capital
Improvement Costs that the Metro System should be obligated to contribute to the Pure Water
Program, the purpose of which is not solely the disposal of wastewater, but also the production
of Repurified Water. The parties agree that this $1.8 billion maximum contribution should apply
whether or not the Point Loma WTP is actually upgraded to secondary treatment to meet legal
requirements in the future because, as of the date of the Agreement, the parties have the option of
upgrading the Point Loma WTP to full secondary treatment for the cost of approximately $1.8
billion.
In light of the above, the parties have agreed that if Metro System costs related to the
Pure Water Program exceed the $1.8 billion, City’s Water Utility will pay a charge for each acre
foot of secondary treated effluent produced by Metro System facilities and used for the
production of Repurified Water.
5.2 Capital Expense Rate. Under the circumstances described below, City’s Water
60409.00001\30398144.16 5
Utility shall pay a charge (“Capital Expense Rate”) for each acre-foot of secondary treated
effluent produced by Metro System facilities and used for the production of Repurified Water.
City’s Water Utility shall pay the Capital Expense Rate if the following costs alone, or in
combination, exceed $1.8 billion (which amount shall be adjusted for inflation):
(a) the sum of all Capital Improvement Costs and associated debt attributable
to the Metro System components of the Pure Water Program under this Exhibit F; and/or
(b) the sum of all Capital Improvement Costs and associated debt for the full
or partial upgrading of the Point Loma Wastewater Treatment Plant to secondary treatment.
Notwithstanding the above, the Capital Expense Rate shall not apply if the Point Loma
WTP is actually upgraded to secondary treatment (or beyond) due to: (a) a change in federal or
state statutory law making it necessary to upgrade the Point Loma WTP to comply with such
new discharge standard; or (b) a final decision by a state or federal court or a federal
administrative agency of competent jurisdiction that an NPDES permit modified under section
301(h) & (j)(5) of the Clean Water Act is thereby revoked or denied renewal due to a finding that
the discharge from the Point Loma WTP violates anti-degradation rules or regulations
promulgated under section 403 of the Clean Water Act.
5.3 Calculation of Capital Expense Rate. The amount per acre-foot of the Capital
Expense Rate shall be determined as follows:
The City shall estimate whether the Capital Expense Rate shall apply to the upcoming
fiscal year (and its amount) prior to January 15 of each year, and the estimated amount of the
Capital Expense Rate shall be effective on July 1 of the upcoming fiscal year.
The sum of all Capital Improvement Costs and associated
debt attributable to (i) the Metro System components of the Pure
Water Program under this Exhibit F and (ii) upgrading of the Point
Loma WTP to secondary treatment (if any)
less
$1.8 billion, as adjusted for inflation each July 1 (starting on July
1, 2019) to reflect the annual percentage change in the Engineering
News Record – Los Angeles construction cost index
multiplied by
1.42 (which estimates the total interest on a 30-year State
Revolving Fund loan with an interest rate of 2.5%)
and divided by
The total number of acre feet per year of secondary treated effluent
that is expected to be produced by Metro System facilities for the
production of Repurified Water over a period of thirty (30) years.
60409.00001\30398144.16 6
For purposes of this Article V of Exhibit F, Capital Improvement Costs and associated
debt shall include such costs incurred by the Metro System prior to the effective date of the
Agreement.
5.4 Year-End Adjustment
At the end of each fiscal year during which the Capital Expense Rate applies, the City
shall determine the actual Capital Improvement Costs and associated debt attributable to the
Metro System components of the Pure Water Program under this Exhibit F and any upgrading of
the Point Loma WTP to secondary treatment, the then-applicable interest amount for outstanding
loans for the Metro System components of the Pure Water Program and Point Loma WTP
upgrades, and the actual amount of secondary treated effluent produced by Metro System
facilities and used for the production of Repurified Water.
Based on the actual cost, interest, and effluent information, the City will recalculate the
Capital Expense Rate for the prior fiscal year. The City will credit any future charges or bill for
any additional amounts due the quarter after the prior year costs have been audited.
5.5 Duration; Expiration
The duration and expiration of the Capital Expense Rate is set forth in Section 13.4 of the
Agreement.
60409.00001\30398144.16
ATTACHMENT 1 – PURE WATER PHASE I COST ESTIMATE
Note: The above estimates are based on 60% design of Phase I of the Pure Water Program.
EXHIBIT G
60409.00001\30914102.16
EXHIBIT G
PURE WATER CAPITAL BILLING TABLE
STAFF REPORT
TYPE MEETING: Regular Board Meeting MEETING DATE: April 3, 2019
SUBMITTED BY: Mark Watton,
General Manager
W.O./G.F. NO: DIV. NO.
APPROVED BY:
Susan Cruz, District Secretary
Mark Watton, General Manager
SUBJECT: Board of Directors 2019 Calendar of Meetings
GENERAL MANAGER’S RECOMMENDATION:
At the request of the Board, the attached Board of Director’s meeting
calendar for 2019 is being presented for discussion.
PURPOSE:
This staff report is being presented to provide the Board the
opportunity to review the 2019 Board of Director’s meeting calendar
and amend the schedule as needed.
COMMITTEE ACTION:
N/A
ANALYSIS:
The Board requested that this item be presented at each meeting so
they may have an opportunity to review the Board meeting calendar
schedule and amend it as needed.
STRATEGIC GOAL:
N/A
FISCAL IMPACT:
None.
LEGAL IMPACT:
None.
Attachment: Calendar of Meetings for 2019
G:\UserData\DistSec\WINWORD\STAFRPTS\Board Meeting Calendar 4-03-19.doc
Board of Directors, Workshops
and Committee Meetings
2019
Regular Board Meetings:
Special Board or Committee Meetings (3rd
Wednesday of Each Month or as Noted)
January 2, 2019
February 6, 2019
March 6, 2019
April 3, 2019
May 1, 2019
June 5, 2019
July 3, 2019
August 7, 2019
September 4, 2019
October 2, 2019
November 6, 2019
December 4, 2019
January 16, 2019
February 20, 2019
March 20, 2019
April 17, 2019
May 22, 2019
June 19, 2019
July 24, 2019
August 21, 2019
September 18, 2019
October 23, 2019
November 20, 2019
December 18, 2019
SPECIAL BOARD MEETINGS:
May 2, 2019 at 3:00 p.m.: Budget Workshop No. 1
BOARD WORKSHOPS:
June 5, 2019 at 3:30 p.m.: Budget Workshop No. 2
STAFF REPORT
TYPE
MEETING:
Regular Board
MEETING
DATE:
April 3, 2019
SUBMITTED
BY:
Mark Watton
General Manager
W.O./G.F.
NO:
N/A DIV.
NO.
N/A
APPROVED BY:
Mark Watton, General Manager
SUBJECT: General Manager’s Report
ADMINISTRATIVE SERVICES:
GIS:
• GIS Applications for the District’s Operation Management and
Reporting – Staff presented three recently developed proof of
concept applications using Esri’s latest technology, Insights. The
showcased dashboard application, valve exercise and mark-outs,
provides staff with near real-time reporting of these critical
services, as well as intelligent trending, which can assist with
work planning and future service demands. The other showcased GIS
application, “heat-maps”, will help staff to identify and track
meter transponder issues and pipeline breaks, and report the
information via GIS service maps. The goal is to have these
applications provide intelligent reporting, trending, and
development of proactive mitigation actions to minimize significant
and costly service disruptions.
Human Resources:
• New Hires/Promotions/Recruitments:
o The Construction Inspector, Secretary, and Utility Crew Leader
positions have been filled. The Utility Crew Leader was an
internal promotion.
o The District is recruiting for: Pump Mechanic I/II and Senior
Utility Worker/Equipment Operator.
o These positions are all critical to District operations.
2
IT Operations:
• National Cybersecurity Assessment and Technical Services (NCATS) -
Via a continued partnership with the Department of Homeland
Security (DHS), the District has secured a no-cost, two-week
engagement with their Cybersecurity and Infrastructure Services
Division. A DHS team will be conducting a cyber risk and
vulnerability assessment of the District’s technology security and
associated practices. Together, staff and the DHS team will also
evaluate service areas essential to District technology security in
order to further harden cyber security prevention and intrusion
mechanisms. This security assessment service has a typical cost of
$50,000 - $75,000.
Purchasing & Facilities:
• Lobby Security Enhancement Update:
o Lobby Doors and Ballistic Door Lites - Installation of lobby
ballistic door lites that protect staff areas from the public,
is scheduled for completion by the end of the second week in
April.
o Physical Secure Access - Once the ballistic door lites are
installed, the public service area will be secured with physical
access to staff work areas, granted only by checking-in with
Customer Service or by Public Service staff and after releasing
the door.
o Fortified Lobby Customer Service Desk – Staff has issued a PO
for a Customer Service approved level 3 fortified desk design.
Installation is planned for the end of May. Level 2 barrier
glass will follow as part of the project, with an anticipated
completion timeline of end of the current fiscal year. Finishes
are to complement Board Room appearance and detail.
• BidSync Solicitations – During the last reporting period, one
solicitation was advertised on the District’s solicitation web
portal, BidSync, and on the District’s website:
o “As-Needed Asphaltic Concrete Paving Service” – For all
materials, labor, tools, equipment, supervision, transportation,
handling, traffic control, and other incidentals necessary to
provide as-needed asphaltic concrete paving services as required
by the Otay Water District. The contract term is for one (1)
year with four (4) 1-year extensions. Budgeted amount is
$200,000 per year. This bid closes on April 4, 2019, 11:00:00 AM
PDT.
3
Safety & Security:
• America’s Water Infrastructure Act of 2018 (AWIA 2018) – Staff
continues to follow federal AWIA 2018 updates via the Environmental
Protection Agency. The AWIA 2018 requires the development of an
agency wide risk and resilience assessment (RRA) and emergency
response plan (ERP). All water systems across the nation are
required to complete these two tasks within a two-year timeframe;
timelines are dependent on the size of the population served. Staff
recently attended a local seminar on the subject and is working to
update the District’s existing RRA and ERP. The District has until
March 31, 2020 to comply with the requirements of the new act.
• San Diego Law Enforcement Coordination Center (SDLECC) – Staff
worked with agents from the SDLECC and completed and submitted the
required paperwork to request a cost-free critical infrastructure
vulnerability assessment of the Administration, Operations and
Treatment Plant buildings. The assessments are for internal
consumption only and consist of identifying vulnerabilities that
could be exploited by acts of terrorism; lists and prioritizes the
vulnerabilities that could be exploited; and provides mitigation
and target hardening options. Only with knowledge of any
vulnerabilities, can our organization continue to apply security
fixes and or any other compensatory controls to keep maintaining
the integrity and improve the security of our infrastructure.
Finance:
• FY19 Annual Audit Update – The District’s audit firm, Teaman
Ramirez & Smith, will be onsite between May 20th and May 23rd
conducting interim fieldwork. They will be working closely with
Finance staff to conduct internal control tests and other
preliminary audit work.
• February 14, 2019 Storm Damage – County OES coordinated a
Preliminary Damage Assessment (PDA) with CalOES and FEMA to help
local agencies with storm damage related expenses. Otay staff is
estimating $10,000 in damages at the Storm Water Culvert near the
treatment plant and $40,000 in damages to repair the Force Main
Road from the treatment plant to the use area. FEMA and CalOES
conducted on-site visits on March 8th across the county and are
currently going through all county-wide submitted cost estimates
and notes from their PDAs to determine if the county Operational
Area will receive State or Federal Assistance. If approved, the
county will notify the impacted agencies on how to proceed with
obtaining financial assistance.
• Debt Compliance – Staff is in the process of completing the
required Annual Report for the 2009 GO Bonds and the 2010 A&B ,
4
2013, 2016 and 2018 Water Revenue Bonds which is due to be filed
through EMMA by March 31st. The report includes: the audited
Financial Statements as of June 30, 2018, connections and water
sales data, 10-largest customers listing, listings of District’s
water fees and charges, rate comparison, PERS historic investment
return, employer retirement contribution rates, Pension Asset
Values, Summary of Investments, Outstanding Indebtedness,
Historical Taxes and Net Revenues, Debt Service Coverage, and an
Event reporting summary.
• Fiscal Year (FY) 2020 Budget Preparation – Staff is in the process
of finalizing the FY 2020 Operating and CIP budgets and has begun
preparing for the May 2nd and June 5th Board Workshops. This is
moving along smoothly due to the significant effort that all
departments are putting toward the budget process.
• Sewer Debt Issuance – Finance staff has resumed work on the 2019
Sewer Revenue Bonds to fund Construction Projects per Resolution
No. 4344. An RFP for Bond/Disclosure Counsel will be issued in
April. Staff and the District’s Municipal Advisor are working on a
timeline that ends with a closing date in October 2019.
• Investment Policy No. 27 – Finance staff is preparing an update to
Investment Policy No. 27 for the April Finance Committee Meeting
and the May Board meeting. The revised policy will clarify
Certificates of Deposits as an investment option. The revised
policy will also contain more restrictive language that reduces
risk when investing in Commercial Paper or Medium Term Notes.
• Debt Policy – Finance staff is researching the use of “internal
borrowing” between Water and Sewer Funds as a funding option, in an
effort to minimize external funding. Staff will be drafting an
updated Debt Policy to reflect this new funding option for Board
consideration in May/June timeframe.
• Large Meter Testing- As part of our annual large meter testing
program, 55 large meters (size 3” and above) have been tested
throughout the District since July 1st. Of those tested, five
meters were out of specification. These have either already been
changed out or are on schedule for a change out in the coming
month. Staff is on track to test 120 meters this year.
• Chula Vista Sewer Billing Error - Approximately 250 Chula Vista
sewer customers were overbilled for sewer in February due to a
staff misunderstanding of exactly how a billing code works. Staff
was able to identify the accounts affected and issued those
customers credits and letters the first week of March. Customer
5
Service and IT staff have worked together to put processes in place
to ensure this does not happen again.
• Customer Service Managers Meeting- On March 14th, Otay hosted a
lunch meeting for Customer Service Managers representing agencies
throughout San Diego. This bi-annual meeting was established one
year ago to allow inter-agency discussion of various customer
service related topics. Useful information is always obtained at
these meetings.
• Cash Control Update – As part of the District’s ongoing efforts to
enhance internal controls, Finance and IT staff worked with Union
Bank to implement an additional payment control in August 2018.
This control enhances Union Bank’s ability to detect and stop check
fraud. On March 1, 2019, the control detected a fraudulent check,
which was stolen after mailing and presented for payment. The
control identified the check and staff rejected it as fraudulent.
This payment control eliminated any loss of funds to the District.
Financial Reporting:
• The financial reporting for February 28, 2019 is as follows:
o For the eight months ending February 28, 2019, there are total
revenues of $67,711,016 and total expenses of $68,240.023. The
expenses exceeded revenues by $529,007. Expenses exceeded
revenues due to more rainfall this season. Total rainfall was
10.4 inches for the five month period between October, 2018 and
February, 2019, compared to 2 inches for the same period of
October, 2017 to February, 2018. As a result, residential,
commercial irrigation, and recycled irrigation sales were down
because customers watered their landscaping a lot less
frequently.
• The financial reporting for investments for January 31, 2019 is as
follows:
o The market value shown in the Portfolio Summary and in the
Investment Portfolio Details as of February 28, 2019 total
$76,244,985 with an average yield to maturity of 1.814%. The
total earnings year-to-date are $776,402.
ENGINEERING AND WATER SYSTEM OPERATIONS:
Engineering:
• 870-2 Pump Station Replacement: This project consists of a new pump
station to replace the existing Low Head 571-1 and High Head 870-1
6
Pump Stations. The project also includes the replacement of the
existing liner and cover for the 571-1 Reservoir (36.7 MG). During
the month of March 2019, Pacific Hydrotech, the District’s
construction contractor, continued work on the station’s interior
including the installation of HVAC ducting, electrical cable trays
and conduit. Work to install utility piping for the station’s gas
and sewer lines was also initiated. Station specific submittals are
in progress. February 2019 rains have impacted progress on site.
Environmental compliance during construction is being monitored by
Helix Environmental and to date there have been no issues. The
project is within budget and scheduled to complete in December 2019.
(P2083 & P2562)
• Campo Road Sewer Replacement: The existing sanitary sewer from
Avocado Road to Singer Lane is undersized and located in
environmentally sensitive areas that are difficult to access. The
Campo Road Sewer Replacement project will install approximately
7,420 linear feet of new 15-inch gravity sewer pipe and includes
abandonment of the existing sewer main. During March 2019, the
contractor’s horizontal auger boring subcontractor completed the
jack and bore operations needed to install casing at the East Bore
Jacking Pit located along westbound Campo Road at the north east
corner of the Campo Road/Jamacha Boulevard intersection. It is
anticipated that installation of the planned sewer main within the
casing will begin in April 2019. Wier Construction, the contractor
for the project, also continued installation of the planned sewer
in the Rancho San Diego Village Shopping Center in the area behind
the IHOP. Migratory bird surveys for the project were completed in
March 2019. Sensitive species were identified along eastbound
State Route 94 between Jamacha Boulevard and Via Mercado. Staff is
reviewing proposed mitigation strategies to allow the remaining
sewer installation work located within the lanes of State Route 94
to proceed. The project is within budget and the overall project
is scheduled for completion in June 2019 pending implementation of
mitigation strategies. (S2024)
• Vista Vereda and Hidden Mesa Water Pipelines Replacement: The
existing 1950’s steel water line along Vista Vereda between Vista
Grande Road and Hidden Mesa Trail in the Hillsdale area has
experienced leaks and is nearing the end of its useful life. The
existing water main is located primarily within easements, many of
which have had significant improvements performed over the years
since the water line was constructed. This project will replace
the existing water lines with new water lines in both Vista Vereda
and Hidden Mesa Road. During March 2019, Cass Arietta, the
District’s construction contractor, continued installation of the
new water main in Hidden Mesa Road between Avenida Elisa and
approximately 400 feet west of Hidden Springs Drive. February and
7
March 2019 rains have impacted progress on site. Construction
completion is scheduled for August 2019. (P2574 & P2625)
• Temporary Lower Otay Pump Station Redundancy: This project will add
a second pump to the District’s existing temporary Lower Otay Pump
Station (TLOPS) to provide redundancy. The redundant trailer
vendor’s (Hawthorne) shop drawings have been approved and delivery
of the trailer is scheduled for July 2019. A public works bid
package, including grading, mechanical, structural, electrical,
instrumentation & control, and installation of the trailer is
scheduled to be advertised for construction and awarded in July
2019. The City of Chula Vista issued a Utility Permit on
January 18, 2019. The final revision of the City of San Diego
permit application was submitted on March 12, 2019. District staff
met with the City of San Diego to discuss the District’s design and
possible modifications to the existing water purchase agreement on
January 22, 2019. (P2619)
• Pipeline Cathodic Protection Replacement Program: This project
includes repairs to existing cathodic protection systems, such as
anode replacement, cathodic test station repairs, retrofit/repair of
isolation kits, and repair of existing impressed current systems and
anode beds. The first phase was completed on the District’s 1980
era RWCWRF 14-inch force main in 2017. A portion of the second
phase went out for bid and was awarded with the District’s 870-2
Pump Station project. The remainder of the second phase was awarded
to M-Rae Engineering, Inc. M-Rae completed work in the Sweetwater
River east of the Cottonwood Golf Club, in Salt Creek east of Hunte
Parkway, and in the area of Proctor Valley Road November 2018
through March 2019. M-Rae’s contract also includes cathodic
protection improvements on existing interconnect pipelines between
the Central Area and Otay Mesa. Work on this project is being
coordinated with the completion of other CIP projects during the
fiscal year to minimize operational impacts. This project is within
budget. (P2508)
• 711-3 Reservoir Cover/Liner Replacement: The existing cover/liner
at the 711-3 Reservoir was installed in 2002 and shows substantial
deterioration that has necessitated its replacement. Layfield, the
construction contractor for the project, completed the testing of
the reservoir’s new liner in March 2019. Work to install the
reservoir’s cover also began in March 2019. Rains in February and
March 2019 have impacted the scheduled completion of the work. The
project is within budget and scheduled to complete in April 2019.
(P2561)
8
• Ralph W. Chapman Water Reclamation Facility (RWCWRF) Headworks
Improvements and Steele Bridge Wet Well Improvements:
This project consists of channel wall and drain line replacements at
the Ralph W. Chapman Water Reclamation Facility (RWCWRF) Headworks,
and it also includes replacement of the existing wet well top slab
and installation of a new stainless-steel wastewater bar screen with
grouting at the Steele Bridge Sewer Pump Station. In March 2019,
Tharsos, Inc. substantially completed work on the project to enable
the treatment plant to go back into service. The project is within
budget and on schedule to complete punch list items in April 2019.
• 803-2 Reservoir Interior/Exterior Coating and Upgrades: This project
consists of removing and replacing the interior and exterior
coatings of the 803-2 (2.0 MG) Reservoir, along with providing
structural upgrades, to ensure the tank complies with both state and
federal OSHA standards as well as the American Water Works
Association and the County Health Department standards. During
March 2019, Advanced Industrial Services, the construction
contractor for the project, continued structural repairs of the
reservoir’s rafter that support the reservoir’s roof. Access to the
803-2 reservoir via the reservoir’s access road that crosses the
Sweetwater River area was impacted during February and March 2019
due to a release of water from the Loveland Reservoir by the
Sweetwater Authority. Access was restored in mid-March and it is
anticipated that structural work will be completed, and interior
blasting will begin in early April 2019. The project completion is
scheduled for August 2019. The project is within budget. (P2565)
• Pure Water Update: The City of San Diego (City) is expected to
award the first contract for the Pure Water San Diego project
starting with a notice to proceed issued in April for early site
work for the North City Water Reclamation Plant. A second bid
package is out on the street for the North City Pure Water Pipeline
for the construction of approximately 7.5 miles of 48-inch welded
steel pipeline and appurtenances from the proposed Pure Water
Facility located on Eastgate Mall to Miramar Reservoir. The cost
of the project and the impact this project will have on water and
sewer rates has been a topic in the news with the City declining to
estimate the impact on City customers.
District staff and the City met briefly last month after the
District received information about on-going negotiations between
the City and Padre Dam Municipal Water District, San Diego County
Sanitation District, and the City of El Cajon (“East County AWP
Parties”) regarding the disposal, treatment, and/or management of
solids, brine, and centrate (residuals) from the East AWP Program
facilities under the Amended Wastewater Agreement.
9
Of specific concern to the District is that the City could restrict
the disposal of residuals into the Metro System. The District met
with members of the MetroTAC Residuals Management Working Group on
March 19, 2019 to discuss the agreement being developed for the
East AWP project and if a similar agreement may be applicable to
Otay. A residuals agreement is not required with the City at this
time, but the District should consider one in the future with the
next Metro agreement or if any operational changes are made to the
Chapman plant that would change the characteristics of flow
returned to the sewer. The District also asked the working group
to create an official record with the City Clerk of JPA concerns
regarding the development and implementation of the wastewater
portion of Pure Water.
On February 26, 2019, the District sent a letter to the City of San
Diego Public Utilities Department to clarify the interpretation of
several sections of the Metro agreement related to the operation of
the RWCWRF. This letter was acknowledged and agreed to by the
City.
With these outstanding issues addressed, staff is ready to take the
Metro agreement to the April 2019 Board of Directors meeting.
• RWCWRF Fuel Lines Replacement: Existing below grade fuel oil
piping, partially installed together with the original treatment
plant in 1979, will be replaced to gain compliance with a 2017
County of San Diego inspection report and current codes. The
existing piping will be replaced, rather than retrofitted with a
cathodic protection system, because the piping has reached the end
of its useful life. The construction contract with Jauregui &
Culver was executed on January 14, 2019. Notice to Proceed was
issued on February 12, 2019. Project specific materials
acquisition by the contractor is in progress. The project is
scheduled to be completed in June 2019. (R2147)
• Portable Trailer Mounted VFD Pumps: This project consists of
procurement of a portable trailer mounted hydropneumatic pump
station designed for deployment at up to eight (8) existing sites
including five (5) hydropneumatic pump stations and three (3) small
pressure zones each fed by a single gravity reservoir. A
cost/benefit and alternatives analysis were completed in October
2018. District staff prepared drawings and a performance
specification in December 2018. Informal quotes were received and
analyzed in January 2019. The award to procure a single trailer is
currently scheduled for the June Committee/July Board meetings.
This project is on schedule. (P2640)
• On February 27, 2019, staff gave a presentation to the San Diego
State University Student Chapter of AWWA on the District’s Ralph W.
10
Chapman Water Reclamation Facility and the projected impacts of the
City of San Diego’s Pure Water program on the District. Over a
dozen students attended with a number of insightful questions
asked.
• For the month of February 2019, the District sold 18 meters (22.5
EDUs), generating $198,218 in revenue. Projection for this period
was 60.8 meters (77.1 EDUs), with a budgeted revenue of $672,173.
Total revenue for Fiscal Year 2019 is $6,079,214 against the annual
budget of $8,066,070.
Water System Operations (reporting for February):
• The Treatment Plant was shut down on January 22 and will restart on
approximately March 25. This shutdown is required so that
contractors can accomplish routine inspections and perform
scheduled maintenance on the Treatment Plant’s effluent force main,
aeration basin upgrades, headworks and Steele Canyon Lift Station
improvements. During this time, there will be no discharge of
effluent flows into the recycled distribution system. All of the
influent flows will be pumped using the San Diego County Rancho San
Diego Lift Station.
• On February 2, staff performed an unplanned shutdown at 1317 Park
Drive in Chula Vista affecting 23 residential meters due to a
defective 1-inch saddle on an 8-inch ACP main. The main break
lasted from 7:45 PM to the next day at 5:30 AM. A water trailer was
on site for affected customers.
• On February 14, staff performed a planned shutdown to replace one
8-inch valve and install a new 12-inch valve at 3250 Sweetwater
Springs Boulevard in Spring Valley to facilitate the upcoming
County of San Diego storm water project. Helix Water District’s
Emergency Interconnect at Sweetwater Springs Boulevard was opened
to provide water to the nearby school. A total of 43,850 gallons or
0.13 AF was used.
• On February 16, staff performed an unplanned emergency shutdown at
1500 Seal Point Court in Chula Vista due to a break on the 6-inch
ACP line caused by tree roots. Four residential meters were
affected from 12:30 PM to 4:40 PM.
• On February 19, staff performed a planned shutdown on Hidden
Springs Drive in El Cajon for the contractor (Cass Arrieta) to cut
and cap the existing main to facilitate future tie-ins with the new
main. The shutdown affected 19 residential customers and it lasted
from 8:00 AM to 5:00 PM. A water trailer was on site for affected
customers.
11
• On February 26, staff performed an unplanned emergency shutdown at
the end of Osage Street in Spring Valley due to a beam breakage on
an 8-inch ACP line on the 2-inch blow off saddle. The shutdown
lasted from 10:00 AM to 1:00 PM and no customers were affected.
• On February 27, staff performed a planned shutdown at Hidden
Springs Drive and Hidden Mesa Road in El Cajon as part of the new
pipeline replacement project. Sixteen residential meters were
affected from 8:00 AM to 3:30 PM and a water trailer was on site
for those affected.
• On February 28, staff performed a planned shutdown on Hidden Mesa
Road and Avenida Elsa in El Cajon to tie-in the new pipeline.
Fourteen residential meters were affected from 8:00 AM to 4:30 PM
and a water trailer was on site for those affected.
• As a follow up to the March 6 Board Meeting, staff reviewed the
following initiatives and information in order to mitigate the
theft of District water:
Initiatives:
o Over a year ago, District staff created and published a video on
the District’s YouTube channel that informs the public of how to
identify potential occurrences of water theft and the impacts
water theft can have on the public it serves. Since it went
live, the video has over one thousand views.
o Additionally, the District has published on its website the
fines that have been issued, while withholding names, in order
to deter others and to reinforce that the District does hold
individuals and businesses accountable.
o Staff plans to remind and highlight these efforts publicly in
upcoming newsletters and social media outreach.
o Spotting water theft is a regular topic of discussion with field
staff to be mindful of as they travel to and from job sites
throughout the District.
o Staff has developed an online water theft form on the District’s
SharePoint site to allow staff members to report water theft
violations out in the field. Staff is also looking into
developing an online form for the public to use.
Information:
o There are 6,192 hydrants within the District. The average cost
to lock a hydrant is approximately $250 per hydrant (for
materials only) resulting in a total estimated cost of
$1,500,000 (without installation) to retrofit the District’s
hydrants.
12
o The average cost of a water truck, with a 2,000 gallon capacity,
is approximately $20 worth of water.
o The use of these locking devices, although a deterrent, still
will not guarantee that they will prevent break-ins for water
theft.
o The use of these locking devices and keys would need to be
coordinated with all the fire departments located within the
District so as not to interfere with emergency response.
• On March 12, staff responded to a sanitary sewer overflow from a
manhole south of the Rancho San Diego Village Shopping Center in La
Mesa. Staff cleared the sewer main and discovered pieces of pipe in
the sewer main that was causing the partial blockage. It was
determined that the contractor working on the Campo Road Sewer
Replacement Project left the pieces of pipe in the sewer main and
is responsible for the overflow.
• On March 20, Cal-American Water requested to have the emergency
interconnect on Otay Valley Road opened due to a main break in
their system. The interconnect was used for approximately 90
minutes.
Purchases and Change Orders:
• The following table summarizes purchases and Change Orders issued
during the period of February 19 through March 4, 2019 that were
within staff signatory authority:
Date
Action
Amount
Contractor/
Consultant Project
02/19/19 P.O. $8,161.58 Trane US, Inc. Trane Service
Agreement
02/22/19 P.O. $5,000.00 WageWorks, Inc. Flexible Spending
Account
02/28/19 P.O. $19,423.00 Southwest
Millworks, Inc.
Customer Service
Desks
03/04/19 P.O. $9,560.00 Southwest
Millworks, Inc.
Public Service
Desk
13
Water Conservation and Sales:
• Water Conservation - February 2019 usage was 24% lower than
February 2013. Since February 2018, customers have saved an
average of 11% over 2013 levels.
•
• The February potable water purchases were 1,322.2 acre-feet which
is 40.1% below the budget of 2,205.9 acre-feet. The cumulative
purchases through February were 18,754.3 acre-feet which is 11.7%
below the cumulative budget of 21,238.7 acre-feet.
14
• The Febuary recycled water purchases and production were 0.1 acre-
feet which is 99.9% below the budget of 107.8 acre-feet. The
cumulative production and purchases through February were 2,350.4
acre-feet which is 4.8% below the cumulative budget of 2,468.6
acre-feet.
Potable, Recycled, and Sewer (Reporting up to the month of February):
• Total number of potable water meters: 50,537.
• Total number of sewer connections: 4,736.
• Recycled water consumption for the month of February:
o Total consumption: 39 acre-feet or 12,755,644 gallons.
o Average daily consumption: 455,559 gallons per day.
o Total cumulative recycled water consumption since July 1, 2018:
2432.5 acre-feet.
o Total number of recycled water meters: 727.
• Wastewater flows for the month of February:
o Total basin flow: 1,846,889 gallons per day.
This is an increase of 14.22% from February 2018.
o Spring Valley Sanitation District Flow to Metro: 612,903 gallons
per day.
15
o Total Otay flow: 1,233,643 gallons per day.
o Flow Processed at the Ralph W. Chapman Water Recycling Facility:
zero gallons per day.
o Flow to Metro from Otay Water District: 1,233,961 gallons per
day.
• By the end of February there were 6,747 wastewater EDUs.
Check Total
2,776.66
2,706.85
3,537.99
26,597.57
4,326.95 4,326.95
TELEPHONE SERVICES (12/12/18 - 1/11/19) 4,384.97 4,384.97
2052056 03/20/19 07785 AT&T 000012594948 02/12/19 TELEPHONE SERVICES (01/12/19 - 02/11/19)
2051984 03/06/19 07785 AT&T 000012453347 01/12/19
39.31
2052013 03/13/19 17264 ARTIANO SHINOFF ABED 301811 02/19/19 LEGAL SERVICES (THRU JAN 2019) 39,014.40 39,014.40
8,432.56 8,432.56
2051972 03/06/19 19416 ARMANDO MARQUEZ Ref002540984 03/04/19 UB Refund Cst #0000249786 39.31
UB Refund Cst #0000205253 36.31 36.31
2051932 02/27/19 03492 AQUA-METRIC SALES COMPANY INV0072392 02/04/19 INVENTROY
CM201911 02/05/19 MGMT/INSP (Jan 2019) 2,560.00
2051971 03/06/19 19408 ANNA MORALES Ref002540975 03/04/19
CM201910 02/05/19 MGMT/INSP (Jan 2019) 2,720.00
CM20198 02/05/19 MGMT/INSP (Jan 2019) 2,560.00
CM20197 02/05/19 MGMT/INSP (Jan 2019) 5,680.00
CM201912 02/06/19 MGMT/INSP (Jan 2019) 3,127.57
34.67 34.67
2051931 02/27/19 14462 ALYSON CONSULTING CM20919 02/05/19 MGMT/INSP (Jan 2019) 9,950.00
AS-NEEDED UTL LOCATING (1/1/19-1/31/19) 18,787.50 18,787.50
2052048 03/20/19 19424 ALMA BELTRAN Ref002544848 03/18/19 UB Refund Cst #0000240593
131581001 01/31/19 AQUA AMMONIA 248.49
2052012 03/13/19 15024 AIRX UTILITY SURVEYORS INC 1101312019 02/12/19
AQUA AMMONIA 2,477.00
131581120 01/31/19 AQUA AMMONIA 812.50
2051930 02/27/19 07732 AIRGAS SPECIALTY PRODUCTS INC 131581121 01/31/19
675.00
2052011 03/13/19 11462 AEGIS ENGINEERING MGMT INC 1437 02/15/19 DEVELOPER PLAN REVIEW (1/12/19-2/8/19) 28,367.08 28,367.08
1,013.64 1,013.64
2052010 03/13/19 17989 ADS CORP 22335220219 02/16/19 ADS MAINTENANCE & REPORTING (FEB 2019) 675.00
SHAREPOINT SERVICES 750.00 750.00
2052055 03/20/19 18122 ACC BUSINESS 190467422 02/27/19 INTERNET CIRCUITS
1038520 02/07/19 SODIUM HYPOCHLORITE 75.86
2052009 03/13/19 08488 ABLEFORCE INC 8389 03/04/19
1038519 02/07/19 SODIUM HYPOCHLORITE 708.07
1038379 01/31/19 SODIUM HYPOCHLORITE 102.16
SODIUM HYPOCHLORITE 1,112.69
1038378 01/31/19 SODIUM HYPOCHLORITE 708.07
2051929 02/27/19 01910 ABCANA INDUSTRIES INC 1038377 01/31/19
1038986 02/21/19 SODIUM HYPOCHLORITE 136.56
1038762 02/14/19 SODIUM HYPOCHLORITE 101.15
1038763 02/14/19 SODIUM HYPOCHLORITE 718.19
1038761 02/14/19 SODIUM HYPOCHLORITE 505.77
Amount
2052008 03/13/19 01910 ABCANA INDUSTRIES INC 1038985 02/21/19 SODIUM HYPOCHLORITE 1,314.99
CHECK REGISTER
Otay Water District
Date Range: 2/21/2019 - 3/20/2019
Check # Date Vendor Vendor Name Invoice Inv. Date Description
Page 1 of 9
Check TotalAmount
CHECK REGISTER
Otay Water District
Date Range: 2/21/2019 - 3/20/2019
Check # Date Vendor Vendor Name Invoice Inv. Date Description
9,385.90
4,356.13
void
23,513.06
RCS TRAILER RENTAL (FEB 2019) 6,465.00 6,465.002051938 02/27/19 11797 D&H WATER SYSTEMS INC I20190113 01/31/19
I20190188 02/21/19 CHLORINE PM KITS 3,701.28
i20190187 02/21/19 CHLORINE PM PARTS 2,959.35
120.00
2052019 03/13/19 11797 D&H WATER SYSTEMS INC I20190166 02/13/19 CHLORINE ANALYZER & FEED SYSTEM 16,852.43
521.00 521.00
2051990 03/06/19 00693 CSDA - SAN DIEGO CHAPTER 022019 02/27/19 BUSINESS MEETING 120.00
AGENCY FEES 422.10 422.10
2052018 03/13/19 02122 COUNTY OF SAN DIEGO 012142012RI2018 12/27/18 PERMIT FEES # 01214 (MAR 2019-MAR 2020)
2052017 03/13/19 00206 COUNTY OF SAN DIEGO 3310 02/20/19
382.50
2051989 03/06/19 00206 COUNTY OF SAN DIEGO 3310 02/20/19 AGENCY FEES 422.10 422.10
9,683.90 9,683.90
2051937 02/27/19 00184 COUNTY OF SAN DIEGO 2003193E6023701 02/04/19 SHUT DOWN TEST (JAN 2019) 382.50
UB Refund Cst #0000240243 1,709.84 1,709.84
2051988 03/06/19 00099 COUNTY OF SAN DIEGO DPWAROTAYMW 02/09/19 EXCAVATION PERMITS (JAN 2019)
K099479 02/01/19 INVENTORY 365.06
2051987 03/06/19 19410 CORNERSTONE COMMUNITIES Ref002540977 03/04/19
INVENTORY 2,346.80
K089622 01/30/19 INVENTORY 1,644.27
K147275 02/14/19 INVENTORY 937.43
2051936 02/27/19 18331 CORE & MAIN LP K078338 02/01/19
10,398.88 10,398.88
2052016 03/13/19 18331 CORE & MAIN LP K041621 02/18/19 OCTAVE METER 8,448.47
REGISTER REPLACEMENT PROGRAM 7,069.92 7,069.92
2052057 03/20/19 17923 CONCORD UTILITY SERVICES 2507 02/15/19 REGISTER REPLACEMENT PROGRAM
2051986 03/06/19 17923 CONCORD UTILITY SERVICES 2499 02/08/19
9,447.50
2051935 02/27/19 17923 CONCORD UTILITY SERVICES 2488 02/01/19 REGISTER REPLACEMENT PROGRAM 10,761.44 10,761.44
94.14 94.14
2052015 03/13/19 17842 COMMERCIAL TRANSPORTATION 3401 02/26/19 SAFETY TRAINING 9,447.50
AUDIOVISUAL CONSULTING 6,338.96 6,338.96
2052014 03/13/19 00234 CITY TREASURER 1000247086 01/30/19 WATER DELIVERIES (FY 2018)
2051934 02/27/19 19193 CIBOLA SYSTEMS CORP 1900 01/31/19
45.00
2051933 02/27/19 00848 CASS CONSTRUCTION INC 201312019 01/31/19 WATER LINE REPLACEMENT (ENDING 1/31/19) 209,458.85 209,458.85
51.41 51.41
2051985 03/06/19 04071 CAPITOL WEBWORKS LLC 29600 02/28/19 OUTSIDE SERVICES 45.00
UB Refund Cst #0000243482 8.90 8.90
2051974 03/06/19 19412 BRITNEY ODOM Ref002540980 03/04/19 UB Refund Cst #0000242379
2052050 03/20/19 19425 BRANDI LYON Ref002544849 03/18/19
32.96
2052049 03/20/19 12690 BONG LEE Ref002544844 03/18/19 UB Refund Cst #0000015163 48.90 48.90
2051973 03/06/19 19417 BEWAR HAJI Ref002540985 03/04/19 UB Refund Cst #0000250745 32.96
Page 2 of 9
Check TotalAmount
CHECK REGISTER
Otay Water District
Date Range: 2/21/2019 - 3/20/2019
Check # Date Vendor Vendor Name Invoice Inv. Date Description
10,680.25
5,316.39
10,395.82
81.85
2052023 03/13/19 01327 FRANK & SON PAVING INC 201312019 02/12/19 PKG LOT IMPROVE PHASE II (10/1/18-1/31/19) 78,758.09 78,758.09
57.45 57.45
2051979 03/06/19 19403 FRANCISCO PEREZGROVAS Ref002540970 03/04/19 UB Refund Cst #0000007058 81.85
FLEET WASH SERVICES 111.28 111.28
2051992 03/06/19 18600 FRANCHISE TAX BOARD Ben2541037 03/07/19 BI-WEEKLY PAYROLL DEDUCTION
2052022 03/13/19 11962 FLEETWASH INC x1534040 02/22/19
135.00
2051941 02/27/19 11962 FLEETWASH INC x1525936 02/08/19 FLEET WASH SERVICES 148.68 148.68
99.00 99.00
2051991 03/06/19 02591 FITNESS TECH 11181 02/01/19 GYM EQUIPMENT MAINTENANCE (FEB 2019) 135.00
UB Refund Cst #0000069214 29.55 29.55
2051940 02/27/19 17888 FIRST AMERICAN DATA TREE LLC 9003400119 01/31/19 ONLINE DOCUMENTS (MONTHLY)
0662797 02/01/19 INVENTORY 359.63
2051978 03/06/19 19406 FIDEL DUMALAG Ref002540973 03/04/19
06627952 02/11/19 INVENTORY 1,426.61
0664294 02/11/19 INVENTORY 775.81
02/04/19 INVENTORY 4,830.00
0662795 01/31/19 INVENTORY 3,003.77
5,023.31
06642941 02/13/19 INVENTORY 293.08
2051939 02/27/19 03546 FERGUSON WATERWORKS # 1083 06627951
BUTTERFLY VALVES 20,235.46 20,235.46
2052021 03/13/19 03546 FERGUSON WATERWORKS # 1083 0665022 02/19/19 INVENTORY
2052060 03/20/19 03546 FERGUSON WATERWORKS # 1083 0627194 02/15/19
75.00
2052059 03/20/19 19419 FELICIA MONTANO 31219FM 03/12/19 FINGERPRINTING REIMBURSEMENT 20.00 20.00
36.05 36.05
2052051 03/20/19 19423 ERICKA DELACRUZ Ref002544847 03/18/19 UB Refund Cst #0000231179 75.00
UB Refund Cst #0000225707 75.00 75.00
2051977 03/06/19 19407 ELIA CARRILO Ref002540974 03/04/19 UB Refund Cst #0000185843
2051976 03/06/19 19409 DENISSE LEGASPE PACHECO Ref002540976 03/04/19
EI1883000062 04/22/18 GPS TRACKING SYSTEM 1,525.75
EI1883000089 06/06/18 GPS TRACKING SYSTEM 1,525.75
EI1883000109 07/17/18 GPS TRACKING SYSTEM 1,525.75
EI1883000024 02/15/18 GPS TRACKING SYSTEM 1,525.75
EI1883000155 11/11/18 GPS TRACKING SYSTEM 1,525.75
EI188001065 10/18/18 GPS TRACKING SYSTEM 1,525.75
1,525.75
2052058 03/20/19 18705 DELPAK SYSTEMS LTD EI1883000163 12/06/18 GPS TRACKING SYSTEM 1,525.75
25.30 25.30
2052020 03/13/19 18705 DELPAK SYSTEMS LTD EI198000178 02/12/19 GPS TRACKING SYSTEM 1,525.75
2051975 03/06/19 19405 DAVID SAMO Ref002540972 03/04/19 UB Refund Cst #0000040063
Page 3 of 9
Check TotalAmount
CHECK REGISTER
Otay Water District
Date Range: 2/21/2019 - 3/20/2019
Check # Date Vendor Vendor Name Invoice Inv. Date Description
4,152.98
4,222.50
23,109.64
6,805.36
26,105.58
RES 711-3 FLT CVR & LINER (ENDING 2/28/19) 227,762.50 227,762.502052065 03/20/19 15615 LAYFIELD USA CORPORATION 602282019 02/25/19
32,975.00
2051994 03/06/19 13297 LAND SOUTH LLC 1534030419 03/04/19 CUSTOMER REFUND 1,676.35 1,676.35
30,951.25 30,951.25
2052028 03/13/19 05840 KIRK PAVING INC 7026 02/14/19 PAVING SERVICES 32,975.00
UB Refund Cst #0000244005 105.06 105.06
2052064 03/20/19 05840 KIRK PAVING INC 7027 02/14/19 PAVING SERVICES
0644090254 03/08/19 W/O REUFUND D0644-090254 6,105.58
2052054 03/20/19 19426 KELSEA CONLIN Ref002544850 03/18/19
1,757.00
2052027 03/13/19 07536 JAMUL INDIAN VILLAGE 0644090280 03/08/19 W/O REFUND D0644-090280 20,000.00
38.27 38.27
2051993 03/06/19 17106 IWG TOWERS ASSETS II LLC 480436 03/01/19 ANTENNA SUBLEASE (MAR 2019) 1,757.00
SCRUBBER REPAIRS 39,313.75 39,313.75
2052053 03/20/19 19421 IRMA MENDEZ Ref002544845 03/18/19 UB Refund Cst #0000053029
2052026 03/13/19 15368 INTEGRITY MUNICIPAL SYSTEMS 8454 02/22/19
3,480.77
149262 02/04/19 BILL PROCESSING SERVICES 2,365.49
148914 01/31/19 BILL PROCESSING SERVICES 959.10
GAS DETECTION PROGRAM 855.43 855.43
2051946 02/27/19 08969 INFOSEND INC 148915 01/31/19 BILL PROCESSING SERVICES
013672 02/08/19 AS-NEEDED ENVIRONMENTAL (Jan 2019) 237.50
2051945 02/27/19 17816 INDUSTRIAL SCIENTIFIC CORP 2176358 01/31/19
0136278 02/08/19 AS-NEEDED ENVIRONMENTAL (Jan 2019) 525.00
0136263 02/08/19 AS-NEEDED ENVIRONMENTAL (Jan 2019) 341.42
0136264 02/08/19 AS-NEEDED ENVIRONMENTAL (Jan 2019) 3,400.00
0136339 02/11/19 AS-NEEDED ENVIRONMENTAL (Jan 2019) 816.20
6.15 6.15
2051944 02/27/19 15622 ICF JONES & STOKES INC 0136275 02/08/19 SAN MIGUEL HMA (1/1/19-1/25/19) 17,789.52
AS-NEEDED ENVIRO (ENDING 2/17/19) 3,747.73 3,747.73
2052052 03/20/19 19422 HUMBERTO AMES Ref002544846 03/18/19 UB Refund Cst #0000185457
02/06/19 AS-NEEDED ENVIRO (ENDING 1/20/19) 3,942.75 3,942.75
2052025 03/13/19 02008 HELIX ENVIRONMENTAL 70533 02/21/19
3,475.00
200940014 02/12/19 ASSET MANAGMENT SVCS (1/1/19-1/31/19) 747.50
2051943 02/27/19 02008 HELIX ENVIRONMENTAL 70334
LANDSCAPING SERVICES 9,144.00 9,144.00
2052024 03/13/19 18436 HAZEN AND SAWYER DPC 2009400012 02/14/19 HYDRAULIC MODELING (1/1/19-1/31/19)
10086150 03/06/19 DESKTOP COMPUTERS 2,076.49
2051942 02/27/19 12907 GREENRIDGE LANDSCAPE INC 17801 01/31/19
128.76 128.76
2052063 03/20/19 03537 GHA TECHNOLOGIES INC 10081125 02/11/19 DESKTOP COMPUTERS 2,076.49
WCG SCHOOL TOURS (FEB 2019) 3,800.00 3,800.00
2052062 03/20/19 17855 GASTELUM, HECTOR 020119022819 02/28/19 MILEAGE REIMBURSEMENT (FEB 2019)
2052061 03/20/19 13563 FRIENDS OF THE WATER E20190204 02/28/19
Page 4 of 9
Check TotalAmount
CHECK REGISTER
Otay Water District
Date Range: 2/21/2019 - 3/20/2019
Check # Date Vendor Vendor Name Invoice Inv. Date Description
51,870.00
2,544.00
1,458.55 1,458.55
CORROSION SERVICES (1/1/19-1/31/19) 11,040.00 11,040.00
2051957 02/27/19 08972 RICK ENGINEERING COMPANY 0065911 02/11/19 CAMPO RD SUPP SVCS (1/1/19-1/25/19)
2051956 02/27/19 15647 RFYEAGER ENGINEERING LLC 19019 02/04/19
1,155.00
2052034 03/13/19 01715 PORRAS, PEDRO 032419032919A 02/06/19 MEAL ADVANCE (03/24/19-03/29/19) 412.00 412.00
297.50 297.50
2051955 02/27/19 06419 PLANT SOUP INC 1231 02/11/19 PROFESSIONAL WRITING SERVICES 1,155.00
PUMPING SERVICES FOR AER BASINS 18,840.00 18,840.00
2052067 03/20/19 15081 PINOMAKI DESIGN 5827 03/01/19 GRAPHIC DESIGN SERVICES
2052033 03/13/19 19354 PATRIOT ENVIROMENTAL SERV INC 0419000471 02/20/19
17,668.82
2052032 03/13/19 19310 PALM LAUNDRY INC OWD002 02/27/19 TOWEL LAUNDRY SERVICE (FEB 2019) 242.18 242.18
335,707.64 335,707.64
2051954 02/27/19 18562 PACIFIC WESTERN BANK 1401312019 02/06/19 RET/PAC HYDROTECH A7533 (ENDING 1/31/19) 17,668.82
UB Refund Cst #0000240583 191.32 191.32
2051953 02/27/19 06646 PACIFIC HYDROTECH CORPORATION 1401312019 02/06/19 870-2 PS REPLACEMENT (ENDING 1/31/19)
02/15/19 CUSTOM TAPE DRIVE MEDIA 843.69 843.69
2051999 03/06/19 19364 OTAY RANCH FIVE COMMUNITY Ref002540978 03/04/19
1,741.50
225223 02/13/19 GEOTECHNICAL SERVICES (1/1/19-2/25/19) 802.50
2052031 03/13/19 02027 NTH GENERATION COMPUTING INC 33990H
WEBSITE PROFESSIONAL SERVICES 2,970.00 2,970.00
2052030 03/13/19 00761 NINYO & MOORE GEOTECHNICAL 225865 02/25/19 GEOTECHNICAL SERVICES (12/29/18-1/25/19)
2051952 02/27/19 18172 NIGHTCODERS 167 02/15/19
12,573.12
2051998 03/06/19 16255 NATIONWIDE RETIREMENT Ben2541027 03/07/19 BI-WEEKLY DEFERRED COMP PLAN 13,379.62 13,379.62
1,265.48 1,265.48
2052066 03/20/19 16255 NATIONWIDE RETIREMENT Ben2545641 03/21/19 BI-WEEKLY DEFERRED COMP PLAN 12,573.12
WS IRRIGATION UPGRADE (FEB 2019) 40.00 40.00
2051997 03/06/19 19414 MT2 LLC Ref002540982 03/04/19 UB Refund Cst #0000249137
2051996 03/06/19 16613 MISSION RESOURCE CONSERVATION 398 03/01/19
870-2 PS INSPECTION SVCS (ENDING 2/3/19) 30,035.00
1038751 02/04/19 870-2 PS INSPECTION SVCS (ENDING 12/30/18) 21,835.00
2051951 02/27/19 16608 MICHAEL BAKER INT'L INC 1038991 02/06/19
5,886.18
2051980 03/06/19 19411 MEGAN IGO Ref002540979 03/04/19 UB Refund Cst #0000240611 20.60 20.60
4,367.68 4,367.68
2051950 02/27/19 06648 MEASUREMENT CONTROL 205692 02/06/19 TEMP METER REGISTERS W/NICOR 5,886.18
LEAK DETECTION OTAY MESA 7,500.00 7,500.00
2052029 03/13/19 10114 MCV23 LLC 0985090293 03/08/19 W/O REFUND D0985-090293
2051949 02/27/19 15921 MATCHPOINT INC 706 01/31/19
119,058.75
2051948 02/27/19 03792 MARTINEZ, STEPHEN 0197022119 02/21/19 CERTIFICATION RENEWAL 180.00 180.00
78.68 78.68
2051947 02/27/19 18905 M RAE ENGINEERING INC 401312019 01/31/19 PIPELINE CP IMPRVE PHASE II (ENDING 1/31/19 119,058.75
2051995 03/06/19 19418 LOGAN FAMILY PROPERTIES INC Ref002540986 03/04/19 UB Refund Cst #0000251132
Page 5 of 9
Check TotalAmount
CHECK REGISTER
Otay Water District
Date Range: 2/21/2019 - 3/20/2019
Check # Date Vendor Vendor Name Invoice Inv. Date Description
82,212.87
69,413.13
282.99
10.38 10.38
MILEAGE REIMBURSEMENT (FEB 2019) 56.26 56.26
2051982 03/06/19 19415 TRAVIS TAYLOR Ref002540983 03/04/19 UB Refund Cst #0000249520
2052042 03/13/19 14177 THOMPSON, MITCHELL 020119022819 02/28/19
7,763.00
2052041 03/13/19 19272 THARSOS INC 101312019 02/20/19 RWCWRF HEADWORKS/WET WELLS IMPROVE 72,175.35 72,175.35
150.00 150.00
2052040 03/13/19 02376 TECHKNOWSION INC 2899 02/13/19 SCADA SYSTEM INTEGRATION SERVICES 7,763.00
JANITORIAL SERVICES (JAN 2019) 4,780.00 4,780.00
2051961 02/27/19 09221 TACKETT, ZACHARY 02152019 02/20/19 SAFETY BOOT REIMBURSEMENT
2052039 03/13/19 17704 T&T JANITORIAL INC 2018-5458 01/31/19
2,500.00
2051960 02/27/19 14576 SWIATKOWSKI, KEITH 02212019 02/26/19 SAFETY PRESCRIPTION GLASSES 463.00 463.00
9,446.46 9,446.46
2051959 02/27/19 18376 SVPR COMMUNICATIONS 1252 01/31/19 COMMUNICATION CONSULTANT (JAN 2019) 2,500.00
UB Refund Cst #0000038357 104.41 104.41
2052004 03/06/19 15974 SUN LIFE FINANCIAL 3816602019 03/04/19 LIFE INSURANCE AND STD/LTD
2051981 03/06/19 19404 STANLEY OSBORNE Ref002540971 03/04/19
37.70
2052070 03/20/19 19427 SPINIELLO COMPANIES Ref002544851 03/18/19 UB Refund Cst #0000251582 303.65 303.65
6,007.92 6,007.92
2052038 03/13/19 16229 SMITH, TIMOTHY 020119022819 02/28/19 MILEAGE REIMBURSEMENT (FEB 2019) 37.70
EXPENSE REIMBURSEMENT (FEB 2019) 82.69 82.69
2052037 03/13/19 03955 SHEA HOMES LP 0132090307 03/08/19 W/O REFUND D0132-090307
2052003 03/06/19 15000 SEGURA, ADOLFO 02282019 02/28/19
03/07/19 UTILITY EXPENSES (MONTHLY) 217.12
030819 03/08/19 UTILITY EXPENSES (MONTHLY) 65.87
61,737.04
030419 03/04/19 UTILITY EXPENSES (MONTHLY) 7,676.09
2052069 03/20/19 00121 SAN DIEGO GAS & ELECTRIC 030719A
UTILITY EXPENSES (MONTHLY) 17,037.45 17,037.45
2052036 03/13/19 00121 SAN DIEGO GAS & ELECTRIC 030719 03/07/19 UTILITY EXPENSES (MONTHLY)
2051958 02/27/19 00121 SAN DIEGO GAS & ELECTRIC 021919 02/19/19
022519 02/25/19 UTILITY EXPENSES (MONTHLY) 609.53
022619A 02/26/19 UTILITY EXPENSES (MONTHLY) 10.00
022619 02/26/19 UTILITY EXPENSES (MONTHLY) 21,979.50
022819 02/28/19 UTILITY EXPENSES (MONTHLY) 2,070.08
95.00 95.00
2052002 03/06/19 00121 SAN DIEGO GAS & ELECTRIC 022719 02/27/19 UTILITY EXPENSES (MONTHLY) 57,543.76
ASSESSOR DATA (MONTHLY) 125.00 125.00
2052001 03/06/19 10972 SAN DIEGO COUNTY SYMPOSIUM IFMS-19-4067 03/04/19 SEMINAR
2052035 03/13/19 02586 SAN DIEGO COUNTY ASSESSOR 201900159 03/04/19
20.00
2052068 03/20/19 04542 ROBAK, MARK 020119022819 02/28/19 MIELEAGE REIMBURSEMENT (FEB 2019) 99.76 99.76
2052000 03/06/19 19402 RICKY NAJARILA 030119RN 03/01/19 FINGERPRINTING REIMBURSEMENT 20.00
Page 6 of 9
Check TotalAmount
CHECK REGISTER
Otay Water District
Date Range: 2/21/2019 - 3/20/2019
Check # Date Vendor Vendor Name Invoice Inv. Date Description
1,649.31
578.33
610020 01/11/19 SERVICE CALLS 136.00
613772 02/01/19 SECURITY AND ACCESS CONTROL 125.09
610028 01/11/19 SERVICE CALLS 136.00
610029 01/11/19 SERVICE CALLS 136.00
610038 01/11/19 SERVICE CALLS 136.00
610039 01/11/19 SERVICE CALLS 136.00
610024 01/11/19 SERVICE CALLS 168.31
610043 01/11/19 SERVICE CALLS 152.16
610025 01/11/19 SERVICE CALLS 209.39
610041 01/11/19 SERVICE CALLS 170.00
613773 02/01/19 SECURITY AND ACCESS CONTROL 427.37
610042 01/11/19 SERVICE CALLS 236.33
610040 01/11/19 SERVICE CALLS 690.17
610019 01/11/19 SERVICE CALLS 620.64
613774 02/01/19 SECURITY AND ACCESS CONTROL 2,272.87
613775 02/01/19 SECURITY AND ACCESS CONTROL 1,108.36
610207 01/16/19 ALARM AND ACCESS CONTROL 2,507.54
610809 01/31/19 CONDUIT INSTALLATION 2,376.00
8,239.85
610807 01/31/19 PUBLIC SERVICE ACCESS CONTROL 4,151.51
610808 01/31/19 CONDUIT INSTALLATION 3,004.88
BI-WEEKLY 401A PLAN 7,255.39 7,255.39
2051966 02/27/19 15807 WATCHLIGHT CORPORATION 610018 01/11/19 SECURITY REMOVAL/REPL 803-2 RES
2052007 03/06/19 06414 VANTAGEPOINT TRANSFER AGENTS Ben2541033 03/07/19
16,609.96
2052072 03/20/19 06414 VANTAGEPOINT TRANSFER AGENTS Ben2545647 03/21/19 BI-WEEKLY 401A PLAN 4,855.39 4,855.39
16,561.39 16,561.39
2052071 03/20/19 01095 VANTAGEPOINT TRANSFER AGENTS Ben2545649 03/21/19 BI-WEEKLY DEFERRED COMP PLAN 16,609.96
MGMT/INSP (JAN 2019) 12,475.00 12,475.00
2052006 03/06/19 01095 VANTAGEPOINT TRANSFER AGENTS Ben2541035 03/07/19 BI-WEEKLY DEFERRED COMP PLAN
2051965 02/27/19 08028 VALLEY CONSTRUCTION MANAGEMENT SD10773 02/04/19
392.58
1148046885 02/14/19 PORT. TOILET RENTAL (2/12/19-3/11/19) 98.25
1148046882 02/14/19 PORT. TOILET RENTAL (2/12/19-3/11/19) 87.50
PORT. TOILET RENTAL (2/12/19-3/11/19) 79.96 79.96
2052005 03/06/19 15675 UNITED SITE SERVICES INC 1148046976 02/14/19 PORT. TOILET RENTAL (2/12/19-3/11/19)
18dsbfee371 02/01/19 DIG SAFE BOARD FEES (MONTHLY) 619.61
2051964 02/27/19 15675 UNITED SITE SERVICES INC 1148020791 02/11/19
32,196.44
2051963 02/27/19 00427 UNDERGROUND SERVICE ALERT 120190492 02/01/19 UNDERGROUND ALERTS (MONTHLY) 1,029.70
2051962 02/27/19 17967 TRI COUNTY PUMP COMPANY 16486 01/31/19 MOTOR REPAIR 32,196.44
Page 7 of 9
Check TotalAmount
CHECK REGISTER
Otay Water District
Date Range: 2/21/2019 - 3/20/2019
Check # Date Vendor Vendor Name Invoice Inv. Date Description
27,276.47
28,021.95
195.00 195.00
EXPENSE REIMBURSEMENT (02/03/19-02/07/19) 293.57 293.57
2052047 03/13/19 03151 ZHAO, MING 020319030719 03/07/19 MILEAGE REIMBURSEMENT (2/3/19-3/7/19)
2051970 02/27/19 03151 ZHAO, MING 020319020719 02/20/19
6.12
2052046 03/13/19 18215 ZAYO GROUP LLC 2019030024566 03/01/19 COLOCATION SERVICES 6,546.98 6,546.98
9,815.27 9,815.27
2051983 03/06/19 19413 ZAINA WILLIAMS Ref002540981 03/04/19 UB Refund Cst #0000249056 6.12
EMPLOYEE BENEFITS (JAN 2019) 787.50 787.50
2052045 03/13/19 14857 XYLEM/YSI INCORPORATED 771388 02/18/19 NITRATE SENSOR REPLACEMENTS
2052074 03/20/19 08023 WORKTERRA 0091996IN 01/31/19
23,195.40
2051969 02/27/19 18101 WIER CONSTRUCTION CORP 1901312019 02/08/19 SEWER REPLACEMENT (JAN 2019) 440,712.60 440,712.60
125.00 125.00
2051968 02/27/19 18173 WESTERN ALLIANCE BANK 1901312019 02/08/19 RET/WEIR CONSTRUCTION A#2222 (JAN 2019) 23,195.40
HYDRAULIC MODELING (ENDING 1/31/19) 12,520.00 12,520.00
2052044 03/13/19 01343 WE GOT YA PEST CONTROL INC 20511 02/12/19 BEE REMOVAL
2051967 02/27/19 15726 WATER SYSTEMS CONSULTING INC 3634 01/31/19
614273 02/18/19 SECURITY AND ACCESS CONTROL 257.60
614314 02/18/19 SECURITY AND ACCESS CONTROL 110.21
614370 02/19/19 SECURITY AND ACCESS CONTROL 362.90
614619 02/25/19 SECURITY AND ACCESS CONTROL 338.10
614279 02/18/19 SECURITY AND ACCESS CONTROL 446.45
614606 02/25/19 SECURITY AND ACCESS CONTROL 445.80
614310 02/18/19 SECURITY AND ACCESS CONTROL 515.21
614362 02/19/19 SECURITY AND ACCESS CONTROL 491.31
614547 02/22/19 SECURITY AND ACCESS CONTROL 1,491.29
614317 02/18/19 SECURITY AND ACCESS CONTROL 1,324.90
614320 02/18/19 TREATMENT PLANT SECURITY 1,717.35
614352 02/19/19 TREATMENT PLANT SECURITY 1,701.50
614302 02/18/19 SECURITY AND ACCESS CONTROL 2,116.07
614365 02/19/19 SECURITY AND ACCESS CONTROL 1,840.31
614372 02/19/19 SECURITY AND ACCESS CONTROL 2,348.22
614269 02/18/19 SECURITY AND ACCESS CONTROL 2,146.69
5,417.87
614361 02/19/19 SECURITY AND ACCESS CONTROL 2,477.25
612601 02/15/19 SECURITY ALARM MONITORING 2,472.92
SECURITY AND ACCESS CONTROL 3,700.60 3,700.60
2052043 03/13/19 15807 WATCHLIGHT CORPORATION 614376 02/19/19 SECURITY AND ACCESS CONTROL
2052073 03/20/19 15807 WATCHLIGHT CORPORATION 610302 01/18/19
610036 01/11/19 SERVICE CALLS 68.00
610030 01/11/19 SERVICE CALLS 68.00
Page 8 of 9
Check TotalAmount
CHECK REGISTER
Otay Water District
Date Range: 2/21/2019 - 3/20/2019
Check # Date Vendor Vendor Name Invoice Inv. Date Description
Amount Pd Total: 2,528,841.29
Check Grand Total: 2,528,841.29
Page 9 of 9