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HomeMy WebLinkAbout07-03-19 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 July 3, 2019 3:30 P.M. AGENDA 1. ROLL CALL 2. PLEDGE OF ALLEGIANCE 3. APPROVAL OF AGENDA 4. PRESENTATION OF THE WATERSMART LANDSCAPE CONTEST “BEST IN DIS- TRICT” AWARD TO BOB AND SHAN CISSELL (PRESIDENT THOMPSON AND DIRECTOR ROBAK) 5. APPROVE THE MINUTES OF THE REGULAR BOARD MEETING OF APRIL 3, 2019 6. PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC TO SPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE BOARD'S JURIS- DICTION BUT NOT AN ITEM ON TODAY'S AGENDA CONSENT CALENDAR 7. ITEMS TO BE ACTED UPON WITHOUT DISCUSSION, UNLESS A REQUEST IS MADE BY A MEMBER OF THE BOARD OR THE PUBLIC TO DISCUSS A PARTICU- LAR ITEM: a) APPROVE AN INCREASE TO THE CIP P2619 BUDGET IN THE AMOUNT OF $300,000 AND AWARD A CONSTRUCTION CONTRACT TO THARSOS, INC. FOR THE TEMPORARY LOWER OTAY PUMP STATION REDUNDANCY PRO- JECT IN AN AMOUNT NOT-TO-EXCEED $1,647,000 b) APPROVE THE ISSUANCE OF A PURCHASE ORDER TO CORTECH ENGI- NEERING FOR THE PURCHASE OF A PORTABLE TRAILER MOUNTED VARI- ABLE FREQUENCY DRIVE PUMP IN AN AMOUNT NOT-TO-EXCEED $453,000 2 ACTION ITEMS 8. BOARD a) DISCUSS THE 2019 BOARD MEETING CALENDAR INFORMATIONAL ITEMS 9. THE FOLLOWING ITEM IS PROVIDED TO THE BOARD FOR INFORMATIONAL PUR- POSES ONLY. NO ACTION IS REQUIRED ON THE FOLLOWING AGENDA ITEM: a) CONSERVATION PROGRAM UPDATE (OTERO) REPORTS 10. GENERAL MANAGER’S REPORT 11. SAN DIEGO COUNTY WATER AUTHORITY UPDATE 12. DIRECTORS' REPORTS/REQUESTS 13. PRESIDENT’S REPORT/REQUESTS OTAY WATER DISTRICT FINANCING AUTHORITY 14. NO MATTERS TO DISCUSS 15. ADJOURNMENT 3 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 partici- pate 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 June 28, 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 June 28, 2019. /s/ Susan Cruz, District Secretary 1 MINUTES OF THE BOARD OF DIRECTORS MEETINGS OF THE OTAY WATER DISTRICT AND OTAY WATER DISTRICT FINANCING AUTHORITY April 3, 2019 1. The meeting was called to order by President Thompson at 3:34 p.m. 2. ROLL CALL Directors Present: Croucher, Gastelum (arrived at 3:35 p.m.), Robak, Smith and Thompson Staff Present: General Manager Mark Watton, Attorney Jeanne Blumenfeld, 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, District Secretary Susan Cruz and others per attached list. 3. PLEDGE OF ALLEGIANCE 4. APPROVAL OF AGENDA A motion was made by Director Robak, seconded by Director Smith 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. APPROVE THE MINUTES OF THE REGULAR BOARD MEETING OF NOVEMBER 7, 2018 A motion was made by Director Robak, seconded by Director Smith 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 board meeting of November 7, 2018. 2 6. 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. INFORMATIONAL ITEM 7. THE FOLLOWING ITEM IS PROVIDED TO THE BOARD FOR INFORMATIONAL 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, Director of Economic and Market Research of Xpera Group, provided an overview of the economic outlook for the world, the United States and San Diego County. He indicated that the world economy is moving in a positive direction and that much of the growth is taking place in emerging markets and this trend will continue. Mr. Nevin indicted that the United States GDP is growing, but not at the same rate as it was growing during the economic recovery. The GDP is increasing 3% and the rate of inflation is remaining low at 2%. He stated that he did not see this changing soon, and that this is positive for the economy. He indicated the employment market in the United States is still doing well with a couple million jobs added each year and unemployment remaining under 4%. It is expected that this will continue through 2020 as well. He stated that California is the world’s 6th largest economy and it will gain over 300,000 jobs in 2019 and he felt this trend would continue. He noted that California has the highest spending rate on research and development ($1.2 million per 100,000 persons) of all the states in the Union. Building in California is good with more than 100,000 units being built each year and non-residential permits are up for the 7th straight year and this is also expected to continue through 2020. San Diego County’s population continues to add 25,000+ persons annually and it will add another 250,000 persons by 2030. The County represents 10% of the State’s population and employment is continuing to grow with the County’s unemployment rate under 4%. The unemployment rate is expected to continue to decline. He noted that the County has 8 to 9 economic drivers where most metropolitan areas only have 2 economic drivers. This provides for San Diego to have a very stable employment base. He presented the number of residential development projections for the Otay Water District service area. He noted that it is estimated that in 2019 another 10,000 residential units will be built. Much of the units will be multi-family (70%) and the majority of these units will be rental units. He stated that many of the rental units are being rented quickly and the sale of townhomes has been very brisk. Developers will be building less single-family homes as the pricing is too high for most buyers. He estimates that in 2019 more industrial developments will be built in 3 the Otay Mesa area, less retail spaces will be built as it is felt that there is enough retail spaces and no office developments will be built over the next 3 years. Following Mr. Nevin’s presentation he and staff responded to comments and questions from members of the board. Director Croucher stepped off the dias at 4:17 p.m. and returned at 4:19 p.m. PUBLIC HEARING 8. PUBLIC HEARING ON BOARD OF DIRECTORS PER DIEM RATE THE BOARD WILL BE HOLDING A PUBLIC HEARING TO HEAR THE PUBLIC’S COMMENTS ON THE PROPOSED 5% INCREASE TO THE BOARD OF DIRECTORS’ PER DIEM RATE FOR ATTENDING MEETINGS AND PERFORMING THE DUTIES OF THEIR OFFICE. a) ADOPT ORDINANCE NO. 573 TO APPROVE THE PROPOSED 5% INCREASE TO THE BOARD OF DIRECTORS’ PER DIEM RATE FOR ATTENDING MEETINGS AND PERFORMING THE DUTIES OF THEIR OFFICE; AND, ADOPT RESOLUTION NO. 4361 AMENDING POLICY 8 TO REFLECT THE NEW PER DIEM RATE AND SECTION C.6.D TO CLARIFY DISTRICT PRACTICE REGARDING DIRECTOR’S RESPONSIBILITY FOR EXPENSES President Thompson opened the public hearing at 4:25 p.m. As no one wished to be heard, the public hearing was closed at 4:26 p.m. The board discussed that by State law the maximum percentage that the board could increase its per diem rate is 5%. With a 5% increase, the District’s per diem rate would be set at $152 which would be below the median of the local water agencies per diem rates. The board also stated that board member compensation is fundamental to assure the District can attract persons of quality who can represent the public well. The position of board member is considered public service and not voluntary service. It was also indicated that a board member’s job is to make good decisions and attract professional staffing. A motion was made by Director Robak, seconded by Director Smith and carried with the following vote: Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson Noes: None Abstain: None Absent: None to adopt Ordinance No. 573 to increase the Board of Directors’ per diem rate 5% to $152 and adopt Resolution No. 4361 to amend Policy 8 as noted in the resolution. CONSENT CALENDAR 4 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: A motion was made by Director Smith, 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 following consent calendar items: a) APPROVE CHANGE ORDER NO. 3 TO THE EXISTING CONSTRUCTION CONTRACT WITH PACIFIC HYDROTECH CORPORATION IN THE AMOUNT OF $64,864 FOR THE 870-2 PUMP STATION REPLACEMENT 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-EXCEED $169,805 FOR FISCAL YEAR 2020; WITH FOUR (4) ONE-YEAR OPTIONS FOR RENEWAL AT THE GENERAL MANAGER’S DISCRETION ACTION ITEMS 10. ENGINEERING AND WATER OPERATIONS a) 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. THE UPDATED AGREEMENT INCORPORATES THE PURE WATER SAN DIEGO PROGRAM, 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 SUSTAINABLE WATER SUPPLY Senior Civil Engineer Steve Beppler indicated that staff is requesting that the board 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. He stated the District is one of twelve participating agencies that sends sewage to the City of San Diego for treatment (mainly at the Point Loma Wastewater Treatment Plant [PLWTP]). The discharge permit for the PLWTP is currently modified to allow for the facility to operate at Advanced Primary Treatment with the waiver required to be reviewed every five (5) years in lieu of constructing secondary treatment facilities. For the 2015 permit renewal, the City reached an agreement with the environmental 5 community to incorporate a Pure Water Program. The Pure Water Program would allow for the PLWTP to attain treatment equivalent to secondary treatment. Please reference the Committee Action notes (Attachment A) attached to the staff report for the details of Mr. Beppler’s presentation. Director Croucher stepped off the dias at 4:49 p.m. and returned at 4:55 p.m. Mr. Beppler indicated that the District took a proactive approach on obtaining clarifications on the agreement and sent a letter to the City of San Diego indicating the District’s interpretation of several sections of the agreement related to the operation of our Ralph W. Chapman Recycling Water Facility and the return of solids to the sewer system. Distinguishing the difference between our current facility and other advanced water purification projects, the District asked the City to acknowledge and agree to the letter which they did. The letter is included as attachment C to the staff report. With the City’s concurrence of the District’s interpretations outlined in the letter, staff is now prepared to recommend the approval of the Amended and Restated Regional Wastewater Disposal Agreement. In response to an inquiry from the board, staff indicated that the approximate rate impact of the amended agreement and the City of San Diego’s Pure Water Project is approximately 9%. Staff will phase in the 9% increase over the next six (6) years into the District’s rate model. After the 9% has been phased in, there is another approximate 20% increase that will need to also be phased in over time. The board requested that staff ask the City of Chula Vista to make their sewer customers aware that their sewer fee will be recalculated based on their 2019 winter water use and that there will not be a sewer rate increase. Staff responded to additional questions and comments from the board. A motion was made by Director Smith, and seconded by Director Robak 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. 11. BOARD a) DISCUSSION OF THE 2019 BOARD MEETING CALENDAR President Thompson indicated that he will not be able to attend the May 1, 2019 regular board meeting and that Director Robak would be chairing the meeting. There were no changes to the board meeting calendar. REPORTS 6 12. GENERAL MANAGER’S REPORT General Manager Watton presented information from his report which included an update on the GIS application for District operations, management and reporting; national cybersecurity assessment and technical services; lobby security enhancements; large meter testing; enhanced cash control; the Campo Road sewer replacement project; the sewer overflow in Rancho San Diego; water conservation; sales and purchases. In response to an inquiry from the board it was indicated that the Chula Vista sewer billing error may be noted in the Strategic Plan billing measure. Staff indicated that the measure provides an allowance for errors, and it is not certain 250 billing errors would have much of an impact on the measure. Staff will review and provide the board information following today’s meeting. The board also inquired about payments listed in the demands list to Watchlight Corporation. Staff indicated that the charges are associated with planned enhancements and improvements to the District’s security system. Staff will review the charges and follow-up with information to the board. Staff responded to additional questions and comments from the board. Director Robak stepped off the dias at 5:47 p.m. and returned at 5:49 p.m. 13. SAN DIEGO COUNTY WATER AUTHORITY UPDATE Director Croucher provided an update on CWA matters which included that representatives have just returned from Sacramento where they met with legislators to discuss the water agencies’ displeasure with the proposed water tax; the Department of Water Resources indicating that the Carlsbad desalination intake pipeline project is not eligible for their grant; water storage; negotiations with employees; the recruitment for the general manager position; and that the chair and general manager of MWD attended a CWA meeting and they also met over breakfast with the chair and general manager of CWA. Director Smith further reported that CWA’s Administration, Finance, Web and GIS team presented on their Asset Management Program; that a legislative public outreach poll will be performed which will include questions concerning recycled water and indirect potable reuse; that the drought contingency plan was signed on March 29, 2019 and is headed to congress for approval; and that funding is still available through MAAP where MWD is providing funding to the member agencies for conservation and public outreach. He also shared with regard to MWD that they are discussing the reconfiguration of the “Water Fix” and that he will be hosting an inspection trip in April to the Colorado River Aqueduct. Director Croucher commented that the board may wish to agendize a discussion on the MAAP funding to identify areas in the District’s service area where may wish to install water filling stations. Directors Croucher and Smith responded to questions and comments from the board. 7 14. DIRECTORS' REPORTS/REQUESTS Director Robak reported that per capita water use within the District’s service area in 2013 was 109 gallons per day (GPD). In 2016 and 2017 the per capita water use dropped to 94 and 93 GPD respectively. In 2018 it increased to 96 GPD. He stated if the 2018 per capita water use is compared to 2013 use (the baseline year), water use has decreased 8.7%. He also noted that, though, California has had record rains this season, an article in the Union-Tribune indicates that local reservoirs are only at 50% capacity. He also shared that this is the first time since 2011 that the State of California is no longer in a drought status. He commended Assistant Chief of Operations Jose Martinez for his presentation on AB1588, providing Veterans credit/certification for their military experience in water treatment processes, to the San Diego East County Chamber. He lastly shared a short video on “shaming” those who drink bottled water which was based on a Game of Thrones episode. Director Gastelum reported that he attended a presentation on desalination at the Carlsbad City Library with Director Robak and indicated that they received very good information. He also shared that he attended the WELL Conference (Water Education for Latino Leaders), the Chula Vista Chamber Commerce Policy meeting, the ACWA Washington DC conference and participated in some webinars in March. Director Smith reported on meetings he attended during the month of March which included the District’s Engineering, Operations and Water Resources Committee, the East County Caucus meeting, and his quarterly meeting with General Manager Watton. Director Croucher indicated Helix WD presented a salary survey at their last board meeting and requested that staff provide copies of the survey to the District’s board members. 15. PRESIDENT’S REPORT President Thompson’s report is attached. He reviewed from the report the meetings he attended in March. 16. CLOSED SESSION The board recessed to closed session at 6:41 p.m. to discuss the following matter: a) CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATION [GOVERNMENT CODE §54956.9] 1 CASE Director Croucher left the meeting at 7:01 p.m. The board reconvened at 7:08 p.m. and Attorney Jeanne Blumenfeld indicated that the board took no reportable actions in closed session. 8 OTAY WATER DISTRICT FINANCING AUTHORITY 17. NO MATTERS TO DISCUSS President Thompson indicated that there were no items scheduled for discussion for the Otay Water District Financing Authority board. 18. ADJOURNMENT With no further business to come before the Board, President Thompson adjourned the meeting at 7:08 p.m. ___________________________________ President ATTEST: District Secretary 9 President’s Report Mitch Thompson April 3, 2019 Board Meeting # Date Meeting Purpose 1 1-Mar Chula Vista Chamber and City of Chula Vista First Friday Breakfast Meeting Represented the District at their Monthly Meeting 2 4-Mar Sycuan Casino Press Conference Press Conference Commemorating MWD and Local Water Agency Partners for Providing a Stable Water Supply for the Casino 3 5-Mar SCEDC Board Meeting Represented the District at the Monthly Board Meeting 4 6-Mar OWD Regular Board Meeting Monthly Board Meeting 5 14-Mar Committee Agenda Briefing Met w/ General Manager Watton to review items that will be presented at the March committee meetings 6 19-Mar Council of Water Utilities Attended the COWU montly meeting. 7 21-Mar Southwestern College Cesar Chavez Student Scholarship Breakfast Represented the District at the event. 8 21-Mar Mexican American Business and Professional Association Represented the District at the Monthly Meeting 9 26-Mar Board Agenda Briefing Met with General Manager Watton and General Counsel Shinoff to review items that will be presented at the April Board Meeting STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: July 3, 2019 SUBMITTED BY: Jeff Marchioro Senior Civil Engineer PROJECT: P2619- 001103 DIV. NO. 1 APPROVED BY: Bob Kennedy, Engineering Manager Dan Martin, Assistant Chief of Engineering Rod Posada, Chief, Engineering Mark Watton, General Manager SUBJECT: Approval to Increase the CIP P2619 Budget in an Amount of $300,000 and Award of a Construction Contract to Tharsos, Inc. for the Temporary Lower Otay Pump Station Redundancy Project GENERAL MANAGER’S RECOMMENDATION: That the Otay Water District (District) Board of Directors (Board): • Increase the CIP P2619 budget by $300,000 (from $2,900,000 to $3,200,000); and • Authorize the General Manager to execute a construction contract with Tharsos, Inc. (Tharsos) for the Temporary Lower Otay Pump Station (TLOPS) Redundancy Project in an amount not-to-exceed $1,647,000 (see Exhibit A for Project location). COMMITTEE ACTION: Please see Attachment A. PURPOSE: To obtain Board approval to increase the overall CIP P2619 budget in the amount of $300,000 (from $2,900,000 to $3,200,000) and to obtain Board authorization for the General Manager to enter into a construction contract with Tharsos for the TLOPS Redundancy Project (Project) in an amount not-to-exceed $1,647,000. 2 ANALYSIS: On August 1, 2018, the District awarded a purchase order to the local CAT dealer (Hawthorne Power Systems) teamed with Chillicothe Metal Company (CMCO) to build a trailer mounted engine and pump. Most of the components to build the trailer including the large diesel engine have been delivered to CMCO’s facility located in Illinois. Hawthorne/CMCO is anticipated to deliver the trailer to the District in December 2019 or January 2020. Hawthorne’s purchase order does not include installation of the trailer at the Project site. Staff prepared a site civil package for installation of the trailer in-house. The District’s as-needed engineering design consultant (Michael Baker) provided structural design and peer review. The District’s as-needed electrical engineer consultant (BSE) provided electrical, instrumentation, and control design. The District’s as- needed corrosion engineer consultant (RFYeager) provided cathodic protection design. The bid documents include grading, raised concrete slab with cut off walls, masonry retaining wall, below and above grade potable steel piping, meter vault, fuel oil piping, electrical improvements, instrumentation and control equipment, and fencing. On May 2, 2019, the Project was formally advertised for bid using BidSync, an online bid solicitation website. The Project was also advertised in the Daily Transcript. BidSync provided electronic distribution of the Bid Documents, including specifications, plans, and addendum. A Pre-Bid Meeting was held on May 9, 2019, which was attended by seven (7) general contractors. A single addendum was sent out to all bidders and plan houses to address questions and clarifications to the contract documents during the bidding period. Bids were publicly opened on May 23, 2019, with the following results: CONTRACTOR TOTAL BID AMOUNT CORRECTED BID AMOUNT 1 Tharsos, Inc. (La Mesa, Ca) $1,647,000.00 $1,647,000.00 2 Advanced Construction Services Inc. (Norman, OK) $1,829,655.91 $1,719,655.91 3 Cora Constructors (Palm Desert, CA) $1,797,900.00 $1,797,900.00 4 Public Works Contractor, Inc. (Spring Valley, CA) $1,941,315.92 $1,941,315.92 5 SCW Contracting Corp (Fallbrook, CA) $1,996,025.00 $1,996,025.00 The Engineer’s Estimate is $1,385,000, which includes four (4) bid allowances (Electrical and Control Systems Additions Allowance, 3 Specialized Equipment Electrical Connections Allowance, Agency Permit Fees, and Environmental/Regulatory Compliance Allowance) added via Addendum 1. The lowest bid is $262,000 higher that the Engineer’s Estimate. As a result, a $300,000 budget increase is required. Staff concluded that the Engineer’s Estimate likely did not capture the risk and complexity associated with this unique project combined with difficult access spanning multiple jurisdictions and permits with the City of San Diego and the City of Chula Vista. The bid items with the largest differences between the Engineer’s Estimate and the low bid include Bid Item 10 “Above Grade Piping” and Bid Item 13 “Electrical, Instrumentation, & Control”. Savings on other District CIPs are expected to offset this budget increase. For example, over $200,000 of the structural steel allowances for the 803-2 Reservoir Interior/Exterior Coating & Upgrades project (P2565) will not be needed. A review of the bids was performed by District staff for conformance with the contract requirements and determined that Tharsos was the lowest responsive and responsible bidder. Tharsos holds a Class A, General Engineering, Contractor’s License in the State of California, which meets the contract document’s requirements, and is valid through January 31, 2021. The reference checks indicated a very good to excellent performance record on similar projects. An internet background search of the company was performed and revealed no outstanding issues with this company. Tharsos recently completed the Ralph W. Chapman Water Reclamation Facility Headworks Improvements and Steele Bridge SPS Wet Well Improvements Project for the District. Their performance on that contract was excellent. Staff verified that the bid bond provided by Tharsos is valid. Staff will also verify that Tharsos’s Performance Bond and Labor and Materials Bond are valid prior to execution of the contract. On May 24, 2019, the District received a Bid Protest from Advanced Construction Services Inc. (ACS) indicating that Tharsos should be considered non-responsive (Exhibit B). ACS’s Bid Protest asserted that, “especially as it relates to the tape coating”, Tharsos’s listed manufacturer for steel pipe (Southland Pipe Corp.) did not meet the requirement of Bid Document Specification Section 15061, Cement Mortar Lined and Tape Coated Steel Pipe and Specials, Paragraph 1.5, Qualification of Manufacturers which states: “Factory applied pipe lining and coating is an element of the completed pipe. Only manufacturers who provide a completed lined and coated pipe can be qualified for this 4 work. The Work requires that one pipe manufacturer accept responsibility for furnishing the complete coated and lined pipe without altering or modifying the Contractor’s responsibilities under the Contract Documents. All pipe components, including but not limited to, manufacturing of steel cylinders, fittings, and applying the linings and coatings (tape wrap, mortar, etc.) for the main pipeline shall be the product of one manufacturer that has been manufacturing steel pipe for municipal water pipelines for at least five years and has completed at least three similar projects of 24” diameter or larger.” As part of the Bid Protest evaluation process, staff forwarded ACS’s Bid Protest to Tharsos and requested a formal response. Tharsos responded on May 29, 2019 (Exhibit C). Also, on May 29, 2019, the District received a Bid Protest from Cora Constructors (Cora) indicating that Tharsos should be considered non- responsive (Exhibit D). Cora’s Bid Protest asserted that Tharsos should not be allowed to substitute the “listed pipe supplier”. Cora’s Bid Protest asserted that “On bid day Southland Pipe acknowledged they did not meet the specifications and notified the companies it bid to of this.” Cora’s Bid Protest also asserted issues with ACS’s and Public Works Contractor’s (PWC) bids as described in Exhibit D. On May 30, 2019, District staff held a conference call with Tharsos and Southland Pipe to review ACS’s and Cora’s bid protests. District staff also prepared a list of questions included in Exhibit E summarizing ACS’s and Cora’s bid protests from the District’s perspective. Tharsos responded on May 31, 2019 (Exhibit F) and stated Southland Pipe considered their quote “a gamble” given the possible misunderstanding that a competitor to Southland Pipe (Northwest Pipe) is the only qualified pipe supplier “...due to Northwest's reported statement on their quote that claimed only Northwest could perform this work.” Tharsos’s response also clarified that the tape wrap process would be performed at Southland Pipe’s facility by Southland employees, which will meet the requirements of the bid documents. The specific details of the tape wrap will be reviewed and approved upon the construction submittal process included in the Project specifications. Staff has completed an evaluation of the Bid Protests submitted by ACS and Cora as related to Tharsos and has determined that the submitted Bid Protests are without merit. Cora’s Bid Protest that 5 substitutions should not be allowed is also without merit since Tharsos has not suggested changing pipe suppliers and Southland appears to meet specification. Staff is, therefore, recommending that the construction contract be awarded to Tharsos. FISCAL IMPACT: Joe Beachem, Chief Financial Officer The total budget for CIP P2619, as approved in the FY 2020 budget, is $2,900,000. Total expenditures, plus outstanding commitments and forecast including this contract, are $3,200,000. See Attachment B for budget detail. Based on a review of the financial budget, the Project Manager anticipates that with a budget increase of $300,000, CIP P2619 will be completed within the new budget amount of $3,200,000. The Finance Department has determined that, under the current rate model, 69% of the funding is available from the Betterment Fund and 31% of the funding is available from the New Water Supply Fee Projects Fund. GRANTS/LOANS: Engineering staff researched and explored grants and loans and found none available for this Project. 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 General Manager’s Vision, "To be a model water agency by providing stellar service, achieving measurable results, and continuously improving operational practices." LEGAL IMPACT: None. JM/BK:jf P:\WORKING\CIP P2619 Temp LOPS Redundancy\Staff Reports\2019 07 03 Trailer Install\BD 07-03-19 Staff Report TLOPS Redundancy.docx Attachments: Attachment A – Committee Action Attachment B – Budget Detail Exhibit A – Location Map Exhibit B - ACS Bid Protest 6 Exhibit C – Tharsos Response to ACS Bid Protest Exhibit D - Cora Protest Exhibit E – District Questions Exhibit F – Tharsos Response to District Questions ATTACHMENT A SUBJECT/PROJECT: P2619-001103 Approval to Increase the CIP P2619 Budget in an Amount of $300,000 and Award of a Construction Contract to Tharsos, Inc. for the Temporary Lower Otay Pump Station Redundancy Project COMMITTEE ACTION: The Engineering, Operations, and Water Resources Committee (Committee) reviewed this item at a meeting held on June 18, 2019, and the following comments were made: • Staff recommended that the Board Increase the CIP P2619 budget by $300,000 (from $2,900,000 to $3,200,000) and authorize the General Manager to execute a construction contract with Tharsos, Inc. (Tharsos) for the Temporary Lower Otay Pump Station (TLOPS) Redundancy Project in an amount not-to-exceed $1,647,000. • It was noted in the staff report that the lowest bid is $262,000 higher than the Engineer’s Estimate. As a result, a $300,000 budget increase is required. • Staff stated that the District received Bid Protests from Advanced Construction Services Inc. (ACS) and Cora Constructors. See Exhibits B and D of the staff report for details. ACS and Cora asserted that Tharsos’ pipeline manufacturer, Southland Pipe Corp., was unable to meet Bid Document Specification Section 15061 related to pipeline fabrication, tape wrapping, coating and lining under one roof. • Tharsos’ responded to the Bid Protests and several questions from the District. Tharsos and Southland stated that because of the short length of the pipeline, they can fabricate it under one roof as required in the specifications. See Exhibits C and F of the staff report for full details. • Staff evaluated the bid protests submitted by ACS and Cora as related to Tharsos and determined that the submitted bid protests are without merit. • In response to a question from the Committee, staff stated that the staff’s Engineer Estimate may not have captured today’s current bidding climate considering uncertainty and risk with pending and threatened tariffs and possible fluctuations in the economy. • Legal Counsel reviewed the bid documents, bid protests, and responses. Legal Counsel concurs with the staff recommendation that the bid protest is without merit. Following the discussion, the committee supported staff’s recommendation and presentation to the full board as a consent item. Following the Committee meeting, on June 24, Cora Construction sent an email to staff arguing that all bids should be rejected. Cora’s email was untimely since it was provided outside of the timelines per California Public Contract Code Section 10345. Cora’s assertion that the District is negotiating a change to the specifications is without merit since no changes to the specifications have been proposed and Tharsos has not suggested changing their listed pipel supplier (Southland). On June 26, 2019, District Legal Counsel responded to Cora’s June 24 email countering Cora’s request to reject all bids. The following attachments have been added to this staff report: Exhibit G – Cora’s Second Protest Exhibit H – District Legal Counsel’s Response ATTACHMENT B – Budget Detail SUBJECT/PROJECT: P2619-001103 Approval to Increase the CIP P2619 Budget in an Amount of $300,000 and Award of a Construction Contract to Tharsos, Inc. for the Temporary Lower Otay Pump Station Redundancy Project 6/3/2019 Budget Planning Consultant Contracts 2,043 2,043 - 2,043 HELIX ENVIRONMENTAL 5,098 5,098 - 5,098 ICF JONES & STOKES INC Regulatory Agency Fees 5,118 5,118 - 5,118 COUNTY OF SAN DIEGO 50 50 - 50 PETTY CASH CUSTODIAN Standard Salaries 105,145 105,145 - 105,145 Total Planning 117,454 117,454 - 117,454 Design 001102 Consultant Contracts 2,535 2,535 - 2,535 RFYEAGER ENGINEERING LLC 35,515 1,970 33,545 35,515 MICHAEL BAKER INT'L INC 46,328 20,972 25,356 46,328 BSE ENGINEERING INC 27,140 27,140 - 27,140 WATER SYSTEMS CONSULTING INC Parking and Tolls 24 24 - 24 PETTY CASH CUSTODIAN Regulatory Agency Fees 125 125 - 125 GOVOLUTION*SERVICE FEE 4,995 4,995 - 4,995 CITY TREASURER Standard Salaries 131,558 130,865 693 131,558 100 - 100 100 Advertisement 1,500 - 1,500 1,500 Reprographics Total Design 248,319 188,626 59,694 248,319 Construction INFRASTRUCTURE EQUIPMENT & MATERIALS 3,396 3,396 - 3,396 PALMER JOHNSON POWER SYST 25,805 25,805 - 25,805 RICK'S MACHINE SHOP 834,222 - 834,222 834,222 HAWTHORNE POWER SYSTEMS Standard Salaries 615 615 - 615 Consultant Contracts 8,758 - 8,758 8,758 BSE ENGINEERING INC 1,647,000 - 1,647,000 1,647,000 Construction Contract 65,880 - 65,880 65,880 CM @4% 82,350 - 82,350 82,350 Inspection @5% 82,350 - 82,350 82,350 Staff Time @5% 82,350 - 82,350 82,350 Contingency @5% Total Construction 2,832,727 29,817 2,802,910 2,832,727 Grand Total 3,200,000 335,897 2,864,104 3,200,000 Vendor/Comments Otay Water District p2619-Temp Lower Otay Pump Station Redundancy Committed Expenditures Outstanding Commitment & Forecast Projected Final Cost OTAY WATER DISTRICTTEMPORARY LOWER OTAY PUMP STATION REDUNDANCYLOCATION MAP EXHIBIT A CIP P2619F P:\WORKING\CIP P2619 Temp LOPS Redundancy\Graphics\Exhibits-Figures\Exhibit A, Location Map.mxd O L Y M P I C P K W Y PROJECT SITE !\ ÃÅ125 H U N T E P K W Y PROCTOR VALLEY RD W U E S T E R D Aä LOWER OTAY LAKE UPPER OTAY LAKE E A S T L A K E P K W Y VICINITY MAP PROJECT SITE NTSDIV 5 DIV 1 DIV 2 DIV 4 DIV 3 ÃÅ54 !\ ÃÅ125 ÃÅ94 ÃÅ905 §¨¦805 F 0 2,3001,150 Feet     From: ken castro [mailto:ken@acs‐8a.com]   Sent: Friday, May 24, 2019 2:24 PM  To: D Martin <dan.martin@otaywater.gov>  Subject: Temporary Lower Otay Pump Station Redundancy (CIP P2619)    Hello Mr. Martin,     Thank you for taking my phone call today.  As we discussed, Advanced Construction Services, Inc. (ACS)  would like to formally protest the bid results of the above referenced Otay Water District bid  solicitation.     ACS would like to call to your attention Section 15061 ‐ Cement Mortar Lined and Tape Coated Steel  Pipe and Specials, Part 1.5 ‐ Qualification of Manufacturers of the Contract Documents, which states  “Factory applied pipe lining and coating is an element of the completed pipe. Only manufacturers who  provide a completed lined and coated pipe can be qualified for this work. The Work requires that one  pipe manufacturer accept responsibility for furnishing the complete coated and lined pipe without  altering or modifying the Contractor’s responsibilities under the Contract Documents. All pipe  components, including but not limited to, manufacturing of steel cylinders, fittings, and applying the  linings and coatings (tape wrap, mortar, etc.) for the main pipeline shall be the product of one  manufacturer that has been manufacturing steel pipe for municipal water pipelines for at least five  years and has completed at least three similar projects of 24” diameter or larger.”     It is our opinion, that the smaller pipe companies such as Southland Pipe Corp. would not be able to  meet this requirement, especially as it relates to the tape coating.  As a result of this opinion, ACS listed  “Northwest Pipe Company” as their named Manufacturer / Vendor for Item 1 and 2. CML & Tape‐ Coated with Mortar Overcoat Welded Steel Pipe on Form A of their submitted bid documents.  In  contrast however, it is our current understanding that the apparent low bidder listed Southland Pipe  Corp. as their named Manufacturer / Vendor for the same item numbers.     With the assumption that the above information is valid and correct, ACS would like to respectfully  request that the District review the bid package submitted by the apparent low bidder, particularly as it  pertains to the above referenced opinion.        Respectfully,  Ken Castro  619‐778‐8750               Exhibit B - ACS Bid Protest 1 THARSOS INC 7839 University Ave, Ste 210 San Diego ELBE 10TH0091 La Mesa, Ca 91942 Cal SBE 1755070 (P) 619-464-1261 (F) 619-825-6577 mlopez@tharsosinc.com May 29, 2019 Jeff Marchioro, P.E. Otay Water District 2554 Sweetwater Springs Blvd Spring Valley, CA 91978 RE: TEMPORARY LOWER OTAY PUMP STATION REDUNDANCY (CIP P2619) SUBJ: Response to Request from OWD to Respond to Bid Protest by Advanced Construction Services, Inc. (ACS) Dear Mr. Marchioro: Per your request, we are responding to the bid protest that was presented by Advanced Construction Services, Inc. (ACS), who presented a claim that states “the District should review the bid package submitted by the apparent low bidder” (Tharsos, Inc.). ACS is basing this request on their opinion that our pipe supplier Southland Pipe Corporation of Rialto, CA is unable to meet the requirement “The Work requires that one pipe manufacturer accept responsibility for furnishing the complete coated and lined pipe without altering or modifying the Contractor’s responsibilities under the Contract Documents.” as defined by specification 15061-1.5 QUALIFICATION OF MANUFACTURERS. Several points should be presented on our behalf that supports our selection of Southland Pipe Corporation as our pipe materials source for this project. Please note the following: 1. Care should always be given to the role of the pipe materials producers in California, such as Southland Pipe and Northwest Pipe. Both well-respected companies produce products that are the culmination of assembly or fabrication of products using materials that originate at large national and/or international manufacturing companies and steel mills. For example, a. The steel sheets or plates that are used in the fabrication of steel cylinders that are then used as the foundation for fabricated steel pipe is forged in a steel mill outside of California and purchased by the pipe fabricators for use in the production of fabricated steel pipe and fittings. The steel mill is the ultimate source for the root product (steel sheet or plate) upon which the fabricators create the products that are sold to contractors in the form of fabricated steel pipe and fittings. The pipe fabricators do not manufacture the steel sheets/plate, but incorporate the sheets/plates manufactured by others into the products that they sell and that you accept as fabricated steel pipe and fittings. 1. For further clarification, Southland Pipe Corporation opts to procure its steel cylinders from the reputable firm Roscoe Moss Company in Los Angeles, CA. Having been in Exhibit C – Tharsos Response to ACS Bid Protest 2 business since 1926, Roscoe Moss has produced more steel cylinder materials than all of the pipe fabricators in California on public works project. Specifically, “Roscoe Moss Company manufactures steel water pipe meeting the requirements of AWWA C-200 for use in supply lines and transmission mains. We provide pipe ranging in diameters from 6 5/8” OD to 60” OD, in wall thicknesses from 10 gauge to ½” and in lengths of 20 feet to 60 feet. For field assembly, we can manufacture single butt weld joints, lap/bell welded slip joints, butt strap joints, and rolled-groove rubber gasket bell joint.” Using a core steel manufacturer with nearly 100 years of cylinder experience, Roscoe Moss provides Southland Pipe Corporation the confidence that its fabrications are built upon a base steel product that is of the highest quality and workmanship possible, and with a century of experience supporting that decision. b. Steel flanges that all pipe fabricators use are manufactured by a forging company who produces pipe flanges for purchase by pipe fabricators for incorporation into the products that they sell. The pipe fabricators do not manufacture the flanges, but incorporate the flanges manufactured by others into the products that they sell and that you accept as fabricated steel pipe and fittings. c. The steel wire mesh that is commonly used in the cement coating process on CML&C steel cylinder pipe is manufactured by steel mills who produce mesh for purchase by pipe fabricators for incorporation into the products that they sell. The pipe fabricators do not manufacture the mesh, but incorporate the mesh manufactured by others into the products that they sell and that you accept as fabricated steel pipe and fittings. d. Steel thread-o-lets and/or weld-o-lets are manufactured by steel manufacturers who specialize in the production of these components such as Babcock & Wilcox and others. The pipe fabricators do not manufacture these pipeline outlet products, but incorporate these products manufactured by others into the products that they sell and that you accept as fabricated steel pipe and fittings. e. Specialized lining and coating materials, such as epoxies and coating products, cementitious products, and tape-wrap products are manufactured by manufacturers who specialize in the production of these components such as 3M, Tnemec and others. The pipe fabricators do not manufacture these lining and coating products, but incorporate these products manufactured by others into the products that they sell and that you accept as fabricated steel pipe and fittings. 2. Attention should be given to not discriminate against the size of a business, as stated in the ACS comment that “the smaller pipe companies such as Southland Pipe Corp. would not be able to meet this requirement, especially as it relates to the tape coating...”. The size of a business is irrelevant to the quality of the products it produces. In today’s world of supporting small business enterprises, it would be inappropriate for a public agency to consider a bid protest to be acceptable because of the protester’s opinion regarding the size of the company whom Tharsos, Inc. proposes to conduct business with. It is the quality of the finished product that shall be reviewed and approved by Otay Water District, and not the size of the business who produced it. 3. Southland Pipe Corporation has been conducting business as a piping systems supplier since 1990. They specialize as a supplier of steel pipe, flanges, and weld and fabricated fittings for the waterworks industry. Southland provides custom steel fabrication and fully engineered projects for pipelines, pump stations, reservoirs, pressure reducing stations, and water and sewage treatment plants throughout the west coast, including, California, Arizona, Nevada. With their large stock of standard weld fittings, fabricated mitered fittings, eccentric, concentric reducer cones, and flanges, Exhibit C – Tharsos Response to ACS Bid Protest 3 Southland is able to expedite orders quickly to meet the time frame that the industry demands. Any additional qualifications or certifications that are required by Otay Water District can be included in our pipe submittal package for this project. 4. It must be recognized that Specification Section 15061-1.50 presents a requirement for ‘manufacturers’ that does not truly represent the pipe fabrication industry standard practices. Fabrication is considered a form of manufacturing, although all pipe fabricators acquire products manufactured by others, and combine these products into fabricated steel pipe and fittings that meet the specific requirements of the project specifications including the linings and coatings. In the example of a fabricator, the ‘manufacturing’ that they perform is the business of combining the materials manufactured by others into a finished product using a number of scrutinizing quality control procedures to ensure that the fabricated steel pipe or fitting meets the pressure ratings, life/longevity standards, corrosion resistance, proper plumb and square fit up, proper lining and coating applications per the manufacturer of the lining and coating products, and all other specified expectations of the end user. It is the quality of the fabrication and coating/lining work that Southland takes pride in, and Tharsos, Inc. accepts responsibility for, that shall be produced specifically for this project. 5. Regarding experience, Southland Pipe Corporation produces steel pipe materials/fabrications to the same specifications as those required for this Otay Water District project and for a multitude of other public agencies including water districts equivalent to or larger than the Otay Water District. a. Specifically, Tharsos, Inc. has asked Southland Pipe Corporation to also respond to the comments made by Advanced Construction Services, Inc. (ACS) as included below: Southland Pipe Corporation has been serving the Waterworks Industry since 1990. Our customer base includes Municipalities, Water Districts, Public and Private Agencies, Contractors and Waterworks Supply Houses. We provide custom steel fabrication and fully engineered projects for pipelines, pump stations, reservoirs, pressure reducing stations, and water and sewage treatment plants throughout the west coast including California, Arizona and Nevada. Southland Pipe employs highly skilled welders and fitters that are certified to ASME Section IX and AWS D1.1. Southland Pipe Corporation currently holds a Class A General Engineering Contractors License, is NSF 61 certified, a member of the Steel Plate Fabricators Association, AWWA member, and Certified WBE and SBE business. A couple of our Current Projects include: 1. Los Alamitos Pump Station Belczak and Sons 8” thru 54” Epoxy lined Cement Coated steel pipe and fittings. $400,000 2. Palmer Avenue Reservoir RSH Construction Services 4” thru 31” CMLC Steel pipe and fittings $310,000 3. Agua Fria Water Plant 12 Ferguson 6” thru 31” CMLC Steel pipe and fittings $128,000 Exhibit C – Tharsos Response to ACS Bid Protest 4 If you would like more information or have any questions, please contact me at (909) 873- 3820. Chris Cartwright V.P. of Operations In closing, Tharsos, Inc. would like to assure Otay Water District, that as a licensed general contractor who specializes in this type of work, Tharsos, Inc. has (1) properly prepared its bid for this project, (2) complied with the requirements of Specification Section 15061-1.50, (3) included the incorporation of quality products and services from Southland Pipe Corporation (www.southlandpipe.com) in its procurement plans for the materials for this project, (4) considered Southland as a qualified pipe system fabricator/manufacture for this project prior to including Southland in the Tharsos bid to Otay Water District, and (5) looks forward to working with Otay Water District on this project including providing materials and products that are 100% in compliance with the acceptance criteria of Otay Water District. If you have any questions, please do not hesitate to contact me. Thank You, Michael Lopez THARSOS INC Michael Lopez Project Manager Exhibit C – Tharsos Response to ACS Bid Protest Southland Pipe Corp. 1230 Durst Drive Rialto, Ca. 92376 Phone 575-539-2463 Fax 575-539-2464 5/23/19 Otay Water District RE: Qualification of Manufacturers To Whom It May Concern: Southland Pipe Corporation is a pipe manufacturer. Southland procures all pipe components and manufactures pipe spools complete with linings and coatings. These pipe spools match a project’s contract drawings and specifications. Southland is solely responsible for the pipe spools as these spools are Southland’s products. To state that Southland is not a pipe manufacturer would be erroneous. Sincerely, Chris Evans, P.E. Southland Pipe Exhibit C – Tharsos Response to ACS Bid Protest May 29,2019 Mr. Jeff Marchioro Otay Water District 2554 Sweetwater Springs Blvd. Spring Valley, CA 91978 Lie # 766304-A&B Reference: Bid Protest-Project CIP P2619-Temporary Lower Otay Pump Station Redundancy Cora Constructors hereby formally protests the bids of Advanced Construction Services Inc., Tharsos Inc. and Public Works Contractor Inc. for the reasons set forth below. The bid proposal has a mandatory Listing of Manufacturers which includes language that states "No substitution of manufacturers will be allowed unless approved by the District." If the District allows a substitution for the listed pipe supplier it will have given both Tharsos Inc, and Public Works Contractor Inc. an unfair advantage. The same applies if the District allows a substitution for the Nusonic Flow Meters. Both Tharsos Inc. and Public Works Contractor Inc. bids are not responsible and are non-responsive since they listed manufacturers for the steel pipe that do not meet the experience requirements in specification sections 150611.5 and 09810 1.1 B. In the case of Tharsos Inc.'s bid they knowingly listed a supplier that did not meet the specifications. On bid day Southland Pipe acknowledged they did not meet the specifications and notified the companies it bid to of this. It was irresponsible for Tharsos Inc. to list Southland Pipe as the manufacturer for the steel pipe. Cora protests the bid of Advanced Construction Services Inc. since it did not comply with section 01090 B 19 which incorporates the SSPWC by reference. Section 2-3.2 of the SSPWC requires the Contractor to self-perform 50% of the work. Advanced Construction Services Inc. on its subcontractor listing page acknowledges it has subcontracted in excess of 50% of the work. This gave Advanced Construction Services Inc. an unfair advantage. Cora also protests Advanced Construction Services Inc.'s bid because they did not list a manufacturer for the 24" and 30" flow meters, they listed a supplier which would enable them to provide an equal and therefore gives them an unfair advantage. For each of the other 75140 St. Charles Place, Ste A • Palm Desert, CA 92211 Tel: 760 674-3201 • Fax: 760 674-3202 Exhibit D - Cora Protest items in their manufacturer listing page they listed the manufacture and not a supplier. The contract specifications in section 17407 2.01 A clearly state to provide a Nusonics Model C800 with no equals. Section 000100 16 states 11 Within ten {10) calendar days after the opening of proposals, the District will issue "Notice of Apparent Low Bidder" to the lowest responsive and responsible Bidder in accordance with the Contract Documents. All three of the protested bids are not responsible and are non- responsive. Paragraph 22 of section 000100 further states "If awarded, the award will be made by the District on the basis of the proposal from the lowest responsive and responsible Bidder." Cora is the lowest responsive and responsible bidder and should be awarded the contract. Res~ctfully, .\ .§~:;:-· Dennis Stockton President Exhibit D - Cora Protest 1 Jeff Marchioro From:Jeff Marchioro Sent:Thursday, May 30, 2019 3:48 PM To:rwilliams@tharsosinc.com; mlopez@tharsosinc.com Cc:D Martin; Bob Kennedy; cevans@gilanet.com Subject:RE: Temporary Lower Otay Pump Station Redundancy Bid Number CIP P2619 Attachments:Cora Protest Letter.pdf; Southland Email.pdf Michael,    As discussed during our conference call please respond to the following comments/questions.     Bidder correspondence:  o Provide all of Southland correspondence with Cora (and others) to clarify the following statement in  Cora’s attached letter:  “On bid day Southland Pipe acknowledged they did not meet the specifications  and notified the companies it bid to of this.”    o Clarify the intent of Southland’s attached email to ACS’s subcontractor M‐Rae which states:  “It seems  Northwest is the only game in town for this job. It would be a gamble to use my number.”     Pipe surface preparation:  o Describe how the pipe surface preparation for tape wrap would be performed.  o Describe who would perform pipe surface preparation for tape wrap.     Tape wrap:  o Describe transport/handling methods between pipe surface preparation and tape wrap stations at  Southland’s plant.  o Describe the location of the stations where tape wrap would be applied.  o Describe which company would apply tape wrap at Southland’s plant or if it will be applied by Southland  staff.     Cement‐mortar/rock shield overcoat:  o Describe transport/handling methods between tape wrap and cement‐mortar/rock shield overcoat  stations at Southland’s plant.  o Describe who will would apply cement‐mortar/ rock shield overcoat.  Thank you,    Jeff Marchioro, P.E.  Senior Civil Engineer  Otay Water District  619.670.2725 (direct)  Jeff.Marchioro@otaywater.gov    From: rwilliams@tharsosinc.com <rwilliams@tharsosinc.com>   Sent: Thursday, May 30, 2019 11:28 AM  To: Jeff Marchioro <Jeff.Marchioro@otaywater.gov>; mlopez@tharsosinc.com  Cc: D Martin <dan.martin@otaywater.gov>; Bob Kennedy <Bob.Kennedy@otaywater.gov>; cevans@gilanet.com  Subject: RE: Temporary Lower Otay Pump Station Redundancy Bid Number CIP P2619  Exhibit E – District Questions 2   Jeff,      I have spoken with Chris Evans of Southland Pipe and he is available to join the call.      We are available at 2:30.     Thank you,        Rich Williams  Tharsos Inc.  General Engineering Contractors  License 980621  7839 University Ave. Suite 210   La Mesa Ca. 91942  (619) 464-1261 (office)  (619) 251-2038 (cell)  (619) 825-6577 (fax)                     From: Jeff Marchioro [mailto:Jeff.Marchioro@otaywater.gov]   Sent: Thursday, May 30, 2019 9:15 AM  To: mlopez@tharsosinc.com  Cc: 'Rich Williams' <rwilliams@tharsosinc.com>; D Martin <dan.martin@otaywater.gov>; Bob Kennedy  <Bob.Kennedy@otaywater.gov>; cevans@gilanet.com  Subject: RE: Temporary Lower Otay Pump Station Redundancy Bid Number CIP P2619     Michael,     As discussed with you and Rich, please let us know your availability for a conference call hopefully this afternoon.  We  suggest that Southland participate in the call.  We are available after 2pm today.     We received the attached bid protest from Cora Constructors.   We also received the attached email from the ACS’s Pipe  Install subcontractor (M‐Rae).     Please be prepared to discuss the following:      Two bidders have indicated that Southland informed them that Southland did not meet the  specifications.  Cora’s attached letter states:  “On bid day Southland Pipe acknowledged they did not meet the  specifications and notified the companies it bid to of this.”   Southland’s attached email to ACS’s subcontractor  M‐Rae states:  “It seems Northwest is the only game in town for this job. It would be a gamble to use my  number.”      We would like to gain a better understanding of Southland’s tape wrap procedures and experience tape  wrapping pipe.  The intent of the Section 15061, Paragraph 1.5 is that the pipe manufacturing and tape wrap  would be performed under one roof.   Historically, Southland has employed an offsite company called “Mobile  Exhibit E – District Questions 3 Pipe Lining and Coating”.   Southland’s current tape wrapping methods (e.g.; The location of pipe surface  preparation and tape wrap application.  Handling methods to protect the tape wrap system prior to application  of cement‐mortar, rock shield overcoat) are unknown.     Thank you,     Jeff Marchioro, P.E.  Senior Civil Engineer  Otay Water District  619.670.2725 (direct)  Jeff.Marchioro@otaywater.gov     From: mlopez@tharsosinc.com <mlopez@tharsosinc.com>   Sent: Wednesday, May 29, 2019 1:52 PM  To: Jeff Marchioro <Jeff.Marchioro@otaywater.gov>  Cc: 'Rich Williams' <rwilliams@tharsosinc.com>; D Martin <dan.martin@otaywater.gov>; Bob Kennedy  <Bob.Kennedy@otaywater.gov>; cevans@gilanet.com  Subject: RE: Temporary Lower Otay Pump Station Redundancy Bid Number CIP P2619     Jeff,     Please find attached our letter of response to the bid protest letter sent to us on 5/24/2019.  Please call me if you have  any questions.     Thank You     Michael Lopez  THARSOS INC  619‐464‐1261 office  619‐669‐8377 cell     From: Jeff Marchioro [mailto:Jeff.Marchioro@otaywater.gov]   Sent: Friday, May 24, 2019 3:28 PM  To: mlopez@tharsosinc.com  Cc: 'Rich Williams' <rwilliams@tharsosinc.com>; D Martin <dan.martin@otaywater.gov>; Bob Kennedy  <Bob.Kennedy@otaywater.gov>  Subject: RE: Temporary Lower Otay Pump Station Redundancy Bid Number CIP P2619     Michael,     Please provide a response to the bid protest copied below focusing on the “one manufacturer” requirement.  The  referenced specification paragraph is attached for convenience.  The attached Southland letter does not address the  “one manufacturer” or experience requirements.       “…Advanced Construction Services, Inc. (ACS) would like to formally protest the bid results of the above  referenced Otay Water District bid solicitation.     ACS would like to call to your attention Section 15061 ‐ Cement Mortar Lined and Tape Coated Steel Pipe and  Specials, Part 1.5 ‐ Qualification of Manufacturers of the Contract Documents, which states “Factory applied pipe  lining and coating is an element of the completed pipe. Only manufacturers who provide a completed lined and  coated pipe can be qualified for this work. The Work requires that one pipe manufacturer accept responsibility  for furnishing the complete coated and lined pipe without altering or modifying the Contractor’s responsibilities  Exhibit E – District Questions 4 under the Contract Documents. All pipe components, including but not limited to, manufacturing of steel  cylinders, fittings, and applying the linings and coatings (tape wrap, mortar, etc.) for the main pipeline shall be  the product of one manufacturer that has been manufacturing steel pipe for municipal water pipelines for at  least five years and has completed at least three similar projects of 24” diameter or larger.”     It is our opinion, that the smaller pipe companies such as Southland Pipe Corp. would not be able to meet this  requirement, especially as it relates to the tape coating.  As a result of this opinion, ACS listed “Northwest Pipe  Company” as their named Manufacturer / Vendor for Item 1 and 2. CML & Tape‐Coated with Mortar Overcoat  Welded Steel Pipe on Form A of their submitted bid documents.  In contrast however, it is our current  understanding that the apparent low bidder listed Southland Pipe Corp. as their named Manufacturer / Vendor  for the same item numbers.     With the assumption that the above information is valid and correct, ACS would like to respectfully request that  the District review the bid package submitted by the apparent low bidder, particularly as it pertains to the above  referenced opinion.”     Thank you,     Jeff Marchioro, P.E.  Senior Civil Engineer  Otay Water District  619.670.2725 (direct)  Jeff.Marchioro@otaywater.gov     From: mlopez@tharsosinc.com <mlopez@tharsosinc.com>   Sent: Friday, May 24, 2019 12:08 PM  To: Jeff Marchioro <Jeff.Marchioro@otaywater.gov>  Cc: 'Rich Williams' <rwilliams@tharsosinc.com>  Subject: Temporary Lower Otay Pump Station Redundancy Bid Number CIP P2619     Jeff,     Thanks for calling and letting us know about the possible protest.  We believe Southland Pipe meets the specifications  for this project. We have attached a letter from them assuring the pipe and lining & coatings and done by them and  meet the requirements of the specifications.     Thank You     Michael Lopez  THARSOS INC  619‐464‐1261 office  619‐669‐8377 cell          Virus-free. www.avast.com      Click here to report this email as spam.  Exhibit E – District Questions 5/31 /19 Michael Lopez Tharsos Inc. 7839 University Ave, Ste 210 La Mesa, Ca 91942 RE: Lower Otay Pump Station Redundancy Project Michael Lopez: Southland Pipe Corp. 1230 Durst Drive Rialto, Ca. 92376 Phone 575-539-2463 Fax 575-539-2464 This Jetter is to address Otay Water District emaiJ of May 30, 2019. Bidder correspondence: Attached is Southland's email correspondence with Cora Constructors. The district already has M-Rae's email correspondence. The only other correspondence was with Ferguson Water Works (not a contractor). There were phone conversations resulting from my emails. These conversations were simply more discussions on my "gamble" statement. The two bidders that are contesting this bid had the option to use Southland or use the higher cost ofNorthwest. The "gamble" I referred to was their own interpretations of the specs. They made their choice. And they knew that Otay has the final say. My email warnings were to make the contractors cognizant of a potential problem due to Northwest's reported statement on their quote that claimed only Northwest could perform this work. Pioe surface preparation: Southland's "Tape Wrap Process" is attached to this letter for more detailed information. The pipe surface preparation for the tape wrap would be preformed after the spools are completely welded and their linings completed. The spools would be sand blasted to a SSPC-SP6 profile. Then a primer would be applied to the steel at 1-3 mils. This work would be performed by Southland employees. Exhibit F – Tharsos Response to District Questions Tape wrap: Spools primed for tape wrapping would be moved by utilizing slings on forklifts. The spools would be placed on one of Southland's pipe spinning machines were advantageous or to a convenient place for hand wrapping. All the tape wrapping work would be performed in Southland's "cement area". This work would be performed by Southland employees. Cement-mortar/rock shield overcoat: Spools tape wrapped would be moved by utilizing slings on forklifts. The spools would be placed on SouthJand's cement coating machine if advantageous or to the area were gunite work is performed. All the rock shield work would be performed in Southland's "cement area". This work would be performed by Southland employees. ~c~ Chris Evans, P.E. Attachments Exhibit F – Tharsos Response to District Questions Chris Evans From: Sent: To: Chris Evans <cevans@gilanet.com> Thursday, May 30, 2019 10:59 AM 'mlopez@tharsosi nc.com' Subject: FW: Lower Otay pump station Michael, Below is my "gamble" statement to Cora Constructors. Chris Evans Southland Pipe From: Chris Evans <cevans@gilanet.com> Sent: Thursday, May 23, 2019 3:48 PM To: 'Dennis Stockton' <des@coraconstructors.com> Subject: RE: Lower Otay pump station Northwest is putting on their quote that only they can quote this job. It is the old under "one roof' type of situation, in their opinion. From: Dennis Stockton <des@coraconstructors.com> Sent: Thursday, May 23, 2019 3:18 PM To: 'Chris Evans' <cevans@gilanet.com> Subject: RE: Lower Otay pump station Why do xou say that? Sincerely, Dennis Stockton IN THE FUTURE, PLEASE USE THIS NEW EMAIL ADDRESS President Cora Constructors Inc. (760) 674-1536 Phone (760) 674-3202 Fax From: Chris Evans [mailto:cevans@gilanet.coml Sent: Thursday, May 23, 2019 1:23 PM To: 'Dennis Stockton' Subject: RE: Lower Otay pump station Dennis, 1 Exhibit F – Tharsos Response to District Questions It seems Northwest is the only game in town for this job. It would be a gamble to use my number. Chris Evans Southland Pipe From: Dennis Stockton <des@coraconstructors.com> Sent: Thursday, May 23, 2019 12:55 PM To: 'Chris Evans' <cevans@gilanet.com> Subject: RE: l ower Otay pump station Thanks Chris Sincerely, Dennis Stockton IN THE FUTURE, PLEASE USE THIS NEW EMAIL ADDRESS President Cora Constructors Inc. (760) 674-1536 Phone (760) 674-3202 Fax From: Chris Evans [mailto:cevans@gilanet.com] Sent: Thursday, May 23, 2019 7:48 AM To: 'Dennis Stockton' Subject: RE: Lower Otay pump station Dennis, My quote is attached. Chris Evans Southland Pipe From: Dennis Stockton <des@coraconstructors.com> Sent: Monday, May 20, 2019 12:25 PM To: cevans@gilanet.com Subject: Lower Otay pump station Hi Chris, Joe tells me you will be bidding this project. Attached is a link to the plans and specs in case you don't have them. Sincerely, Dennis Stockton 2 Exhibit F – Tharsos Response to District Questions IN THE FUTURE, PLEASE USE THIS NEW EMAIL ADDRESS President Cora Constructors Inc. (760) 674-1536 Phone (760) 674-3202 Fax 3 Exhibit F – Tharsos Response to District Questions Tape Wrap Process Shop Applied Process 1. Prepare pipe per American Water Works Association C214 "Tape Coating Systems" and blast pipe per SSPC-SP6 "Commercial Blast Cleaning". 2. Apply Polyken #1019 primer @ 1-3 mils. 3. Apply anti-corrosion inner layer ofPolyken #989-20. Total thickness is to be 20 mils with a 1" min. overlap. 4. Holiday test anti-corrosion layer and repair and defects. 5. Apply mechanical outer layer of Poly ken #955-30. Total thickness is to be 30 mils with a 1" min. overlap. 6. Apply mechanical outer layer ofPolyken #956-30. Total thickness is to be 30 mils with a 1" min. overlap. 7. Total tape system thickness to be 80 mils. Field Applied Process -Joints I. Clean pipe per SSPC-SP3 "Power Tool Cleaning". 2. Apply Polyken #1027 primer. 3. Apply anti-corrosion inner layer of Polyken #932-50. Total thickness is to be 50 mils with a 1" min. overlap. 4. Holiday test anti-corrosion layer and repair and defects. 5. Apply mechanical outer layer ofPolyken #954-15. Thickness is to be 15 mils with a half overlap. 6. Total tape system thickness to be 80 mils. 7. Provide a 3 inch minimum overlap onto shop applied tape coating. Exhibit F – Tharsos Response to District Questions + N I 'v/ATER SHUT-OFF MARTIN EZ &. TUREK, INC . w :::> z w FACILITY VACANT LOT > <( ~ w ~ w u B.N.S.F. SOUTHLAND PIPE FACILITY 1230 DURST DR. RIAL TO, CA. STEEL FITTING STORAGE \ ELECTRICAL ACETYLENE MAIN SHUT-OFF ~I [ ~ /1000 GAL. _, DIESEL 0 o FAB ~CUTTING L SHOP cr FLUID I? ~ c ___. .... .___ • ROPANE \ ' DEF OXYGENj EMERGENCY RESPONSE OFFICE EQUIPMENT COMPLEX CEMENT AREA L CJ I oFFICE I ( ENTRANCE SETVACUATION G~/ AGING AREA ~T DURST DRIV~E---------==== MISSION METALS FACI LITY SECONDARY ENTRANCE NO OPEN SE\JER OR STORM DRAINS ON SITE NO NATURAL GAS ON SITE INER TOYS R US FACILITY SCALE: 1 "=150' Exhibit F – Tharsos Response to District Questions 1 Jeff Marchioro From:Dennis Stockton <des@coraconstructors.com> Sent:Monday, June 24, 2019 4:06 PM To:D Martin Cc:Jeff Marchioro; Vu Tran; 'ken castro' Subject:RE: Bid Protest attached, TLOPS CIP Importance:High Dan,     Thank you for the phone call explaining the Districts position and actions taken in regards to the bid protests received.     We have reviewed the process the District undertook in regards to the protests filed and we completely disagree the  District awarding the contract to Tharsos Inc. is the fair and correct course of action. For this reason we may take legal  action to prevent the project from moving forward with Tharsos Inc.     The District should reject all bids and rebid the project or award it to a bidder that provided a responsible and  responsive bid. The District is negotiating a change to their specifications with Tharsos after the bid. The District is  requesting a $300,000.00 increase to the budget for this project from the Board of Directors. This does not make sense.  If the District rebid the project and allowed Southland Pipe as a supplier it would save  a lot of money and be fair to all of  the bidders. There is plenty of time for the rebid process since the owner furnished equipment will not be delivered to  the site until January of 2020. The project will complete at the same time if it is rebid.     The difference in price between Southland Pipe and Northwest pipe is $297,000.00 plus tax in the amount of $23017.50  which totals $320,017.50. This is without applying any mark up. If Cora used Southland Pipe’s price our bid would have  been at least $320,000.00 lower, actually more. This would have resulted in the District receiving our bid in an amount  less than $1,477,900.00. We are not providing exact numbers since the project may rebid. This amount is $169,100.00  lower than Tharsos Inc.’s bid.      The Districts plan to award the contract to Tharsos Inc. has upset several if not all bidders that followed the  specifications and likely Northwest Pipe. All but one or two bidders (we do not know if Levco meets the  specifications)  took the Districts specifications at face value. We strongly urge District staff to reconsider recommending  to its Board  to award the contract to Tharsos Inc. It is important as a public entity to do the right and equitable thing.  There is nothing to lose and plenty to gain with the correct decision.     Thank you for your consideration and please let us know prior to the July 3rd board meeting of your intentions.       Sincerely,     Dennis Stockton    IN THE FUTURE, PLEASE USE THIS   NEW EMAIL ADDRESS     President   Cora Constructors Inc.  (760) 674‐1536 Phone  (760) 674‐3202 Fax  Exhibit G - Cora Second Protest 2         From: D Martin [mailto:dan.martin@otaywater.gov] Sent: Friday, June 21, 2019 2:25 PM To: des@coraconstructors.com Cc: Jeff Marchioro; Vu Tran Subject: FW: Bid Protest attached, TLOPS CIP Importance: High     Dennis,     Thanks again for your time on the phone today. As discussed, the District presented the Bid Protest received by  Advanced Construction Services Inc. (ACS) to Tharsos for response. Additionally, the District asked clarifying questions of  Tharsos and Southland to address concerns expressed in the ACS Bid Protest along with concerns expressed in the Bid  Protest submitted by Cora Constructors Inc.  The information provided by both Tharsos and Southland demonstrated  that Southland is responsive and capable of providing the pipe in the manner specified by the contract bid documents.  As a result, staff has made a recommendation to award the construction contract to our Board on July 3, 2019. That  recommendation went to the District’s Committee this week on Tuesday June 18, 2019. The staff report that includes  the recommendation is publically available at the following link:     https://lf.otaywater.gov/WebLink/0/edoc/553924/06‐18‐19%20EOWR%20Committee%20Packet.pdf     The staff report is Item No. 3 on the linked agenda. The Bid Protests received along with responses from Tharsos and  Southland are included as exhibits in the staff report. Also included as Exhibits are emails between the District and  Tharsos regarding clarifications needed to review the bid protest. As a follow up to our conversation today I wanted to  make sure that you had the link to the referenced staff report. Thanks again for bidding our projects. As mentioned over  the phone, the District had a good experience with Cora Constructors on the  Ralph W. Chapman Water Reclamation  Facility (RWCWF) Return Activated Sludge (RAS) Pumps Replacement Project that finished up in February 2016.        Dan Martin  Assistant Chief of Engineering  dan.martin@otaywater.gov        2554 Sweetwater Springs Blvd  Spring Valley, CA 91978  Office: (619) 670-2243  Fax: (619) 670-6184              From: Dennis Stockton <des@coraconstructors.com>   Sent: Wednesday, May 29, 2019 1:49 PM  To: Jeff Marchioro <Jeff.Marchioro@otaywater.gov>  Cc: lynne@coraconstructors.com  Exhibit G - Cora Second Protest 3 Subject: Bid Protest attached, TLOPS CIP  Importance: High     Hi Jeff,     Attached please find our formal bid protest. If you have any questions or need additional information let us know.  Please confirm receipt of this email.     Sincerely,     Dennis Stockton    IN THE FUTURE, PLEASE USE THIS   NEW EMAIL ADDRESS     President  Cora Constructors Inc.  (760) 674‐1536 Phone  (760) 674‐3202 Fax             Click here to report this email as spam. Exhibit G - Cora Second Protest Daniel R. Shinoff 619-881-1315 dshinoff@as7law.com 2488 Historic Decatur Road Suite 200 San Diego, California 92106 Main: 619-232-3122 Fax: 619-232-3264 as7law.com AS7 Law San Diego/004344/000002/CO/S0437632.DOCX San Diego Orange County Inland Empire Los Angeles June 26, 2019 Dennis Stockton, President Cora Constructors, Inc. 75140 St. Charles Place, Suite A Palm Desert, CA 92211 Re: Cora Constructors, Inc.'s Bid Protest Relating to TLOPS CIP Dear Mr. Stockton: I have reviewed the bid protest submitted by Cora Constructors, Inc (“Cora”) dated June 24, 2019. After careful review and consideration, the bid protest is untimely pursuant to the Public Contract Code and, even if timely, is without merit. As you know, Otay Water District (“District”) formally advertised for bids for the Construction Contract for the Temporary Lower Otay Pump Station (TLOPS) Redundancy Project. The project was formally advertised on May 2, 2019, using Bid Sync, and in the Daily Transcript. Bids were publicly opened on May 23, 2019. Tharsos, Inc., (“Tharsos”) was the lowest bidder, Advanced Construction Services, Inc., (“ACS”) was the second lowest bidder and Cora was the third lowest bidder. Cora’s First Bid Protest Cora sent the District a written bid protest dated May 29, 2019, asserting that Tharsos’, bid was both non-responsive and not responsible. Cora asserted that Tharsos’ bid was not responsible and was nonresponsive because it listed manufacturers for the steel pipe that do not meet the experience requirements and specifications 15061 1.5 and 09810 1.1 B. Moreover, Cora claimed that Southland Pipe acknowledged they did not meet the specifications and notified the companies it bid of this. Based upon the protest, the District performed an investigation into Tharsos’ history, experience, and trustworthiness. Upon review, Tharsos and Southland Pipe sufficiently explained the statement regarding the bid being “a gamble.” Tharsos and Southland Pipe also clarified that the tape wrap process would be performed at Southland Pipe’s facility by Southland employees. The work performed by Southland Pipe would meet the requirements of the bid Exhibit H – District Legal Counsel Response Artiano Shinoff Dennis Stockton, President June 26, 2019 Page 2 AS7 Law San Diego/004344/000002/CO/S0437632.DOCX documents. The original bid protest was thoroughly investigated and determined that Cora’s bid protest was without merit. Cora’s Second Bid Protest Cora emailed a second bid protest to the District asserting an entirely new basis for a bid protest on June 24, 2019, 31 days after the original protest. Cora asserted that the District negotiated a change to the specifications with Tharsos after the bid was accepted. Cora also indicated that the District was seeking a $300,000 increase to the budget that did not make sense. Cora was requesting that the District rebid the project and allow Cora to use Southland Pipe as a supplier on its bid, which would lower Cora’s bid and make Cora the lowest bidder. It is the District’s longstanding practice to conduct its bid protest procedures in accordance with Public Contract Code section 10345. Section 10345 provides specific deadlines. Cora has failed to comply with these deadlines. Cora filed its bid protest on May 29, 2019. Pursuant to section 10345(a)(3) “within five days after filing the protest, the protesting bidder shall file with…the…agency a full and complete written statement specifying the grounds for the protest.” Any documents or information not provided in accordance with this process will not be considered. As a result, Cora’s protest documents dated June 24, 2019, are untimely. Even if the District were to consider Cora’s bid protest as timely, it is without merit. The June 24, 2019, bid protest by Cora does not offer any specific instance where the District is attempting to negotiate a change after award of the bid. What is clear is that there is no evidence the District is negotiating a change to the specifications to the contract with Tharsos after the bids were opened. Tharsos and Southland Pipe have represented that they meet the requirements of the bid documents. The District has performed its due diligence to ensure that Tharsos and Southland Pipe could perform under the contract. There is no evidence that the District changed the specifications. Substitution of Subcontractors You appear to be taking the position that now that all bids have been made public, you wish to change your list of suppliers/subcontractors to make your bid the lowest. Thus, you want the District to reject all of the bids as non-responsive and non-responsible so that you can resubmit your bid using Southland Pipe, who you earlier asserted was not responsible. From a practical perspective what you are requesting is to upend the public bidding process such that after the opening of bids each bidding entity gets a second chance to reformulate their bid by looking at which suppliers have been listed by other bidding entities. This is contrary to the purpose of the Public Contract Code, and contrary to the District’s established practice. Exhibit H – District Legal Counsel Response Artiano Shinoff Dennis Stockton, President June 26, 2019 Page 3 AS7 Law San Diego/004344/000002/CO/S0437632.DOCX Conclusion Your request to declare the bid from Tharsos non-responsive and not responsible has been reviewed and was determined to be without merit. Your second request to reject all bids and rebid the project is also denied. The District intends to award to Tharsos as the lowest responsive and responsible bid at the next Board Meeting on July 3, 2019. The District sincerely thanks Cora for its interest in bidding on its projects. The District looks forward to Cora’s continued interest in its projects and encourages Cora to continue to check on the District webpage for District projects on which to bid. Very truly yours, ARTIANO SHINOFF Daniel R. Shinoff DRS:JCM:sh Exhibit H – District Legal Counsel Response STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: July 3, 2019 SUBMITTED BY: Jeff Marchioro Senior Civil Engineer PROJECT: P2640- 001103 DIV. NO. varies APPROVED BY: Bob Kennedy, Engineering Manager Dan Martin, Assistant Chief of Engineering Rod Posada, Chief, Engineering Mark Watton, General Manager SUBJECT: Approval to Purchase a Portable Trailer Mounted Variable Frequency Drive Pump GENERAL MANAGER’S RECOMMENDATION: That the Otay Water District (District) Board of Directors (Board) authorize the General Manager to issue a Purchase Order to Cortech Engineering (Cortech) for the purchase of a Portable Trailer Mounted Variable Frequency Drive (VFD) Pump in an amount not-to-exceed $453,000. COMMITTEE ACTION: Please see Attachment A. PURPOSE: To obtain Board authorization for the General Manager to issue a Purchase Order to Cortech for the purchase of a Portable Trailer Mounted VFD Pump in an amount not-to-exceed $453,000. ANALYSIS: District staff completed a cost benefit analysis comparing alternatives that would avoid disruption of water service while taking existing critical facilities offline for extended periods of time. The cost benefit analysis also accounted for cost savings the District could realize from the resulting simplification of existing pump station replacement concepts. CIP P2640 was developed to procure an affordable Portable Trailer Mounted VFD Pump that will be designed for deployment at four (4) existing hydropneumatic pump stations and three (3) existing small pressure zones, each fed by a single gravity reservoir. The Trailer will include six (6) multistage centrifugal variable speed pumps. The specified pump skid is designed to operate at a maximum flow rate of 1,500 gallons per minute (GPM) and up to 385 feet of head. District staff prepared drawings and a performance specification in- house and reached out to the following teams to solicit quotes as shown in Table 1, below. TABLE 1 PUMP SKID BUILDER REPRESENTATIVE 1 PremierFlow (Tulsa, OK) Cortech (San Diego, CA) 2 Grundfos (Brookshire, TX) Barrett Pump (San Diego, CA) 3 Dakota Pump (Mitchell, SD) Flo-Systems (Burbank, CA) 4 Burt Process Equipment (Hamden, CT) Crowley (Irwindale, CA) 5 AIM Solutions (Downers Grove, IL) Watermark Engineered Product Sales, Inc. (Ashland, OH) 6 Munro (Grand Jct., CO) Huntington (Valley Center, CA) 7 JDL Systems (El Monte, CA) Crowley (Irwindale, CA) Six (6) firms submitted informal quotes and the results are shown in Table 2 below. Adjustments were made based on quotes received from equipment builders (Chillicothe Metal Company located in Illinois and Power Zone located in Colorado) for the trailer build and an itemized quote received from the District’s preferred system integrator (TechKnowsion, Inc. located in Pleasant Hill, California) for the programmable logic controller (PLC), programming, and system integration. Minor adjustments were made using engineering estimates. 3 TABLE 2 CONTRACTING FIRM RAW QUOTE AMOUNT ADJUSTMENT APPROXIMATE SALES TAX COMPARABLE AMOUNT 1 Cortech $400K - $23K $423K 2 Barrett Pump $381K +$39K $24K $444K 3 Dakota Pump $445K -$4K $25K $466K 4 Crowley $293K +$198K $28K $519K 5 Watermark $383K +$143K $30K $556K 6 Munro $594K +$85K $39K $718K The following adjustments were made for comparison of the various quotes: 1. Cortech – None. 2. Barrett Pump – Freight, additional staff time, and SCADA system integration. 3. Dakota Pump – Optional deducts (delete trailer roof hatches and reduce trailer length), addition for stainless rather than of painted steel piping. 4. Crowley – Freight and additional staff time. District would separately contract PLC, programming, SCADA system integration, and trailer build. 5. Watermark - Freight and additional staff time. District would separately contract the trailer build. 6. Munro - Additional staff time. District would separately contract PLC cabinet, PLC, programming, and SCADA system integration. After Barrett Pump’s quote was received, it was considered unresponsive since it included a controller with proprietary components that District SCADA staff could not fully maintain or replace without assistance from Barrett Pump/Grundfos. Staff anticipates some modifications will be needed after the review of shop drawings to include some additional controls, SCADA equipment, and other District directed changes to meet District operating requirements. Subsequently, a seven percent (7%) contingency of $30K is included in the award amount to allow staff to modify the purchase order to make District directed changes, if any. FISCAL IMPACT: Joe Beachem, Chief Financial Officer The total budget for CIP P2640, as approved in the FY 2020 budget, is $550,000. Total expenditures, plus outstanding commitments and forecast including this contract, are $546,668. See Attachment B for budget detail. 4 Based on a review of the financial budgets, the Project Manager anticipates that the budget for CIP P2640 is sufficient to support the Project. The Finance Department has determined that, under the current rate model, 100% of the funding is available from the Replacement Fund. GRANTS/LOANS: Engineering staff researched and explored grants and loans and found none available for this Project. 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 General Manager’s Vision, "To be a model water agency by providing stellar service, achieving measurable results, and continuously improving operational practices." LEGAL IMPACT: None. JM/BK:jf P:\WORKING\CIP P2640 Portable Trailer Mounted VFD Pumps\Staff Reports\BD 07-03-19 Staff Report VFD Trailer Procurement R2.docx Attachments: Attachment A – Committee Action Attachment B – Budget Detail ATTACHMENT A SUBJECT/PROJECT: P2640-001103 Approval to Purchase a Portable Trailer Mounted Variable Frequency Drive Pump COMMITTEE ACTION: The Engineering, Operations, and Water Resources Committee (Committee) reviewed this item at a meeting held on June 18, 2019, and the following comments were made\san • Staff recommended that the Board authorize the General Manager to issue a Purchase Order to Cortech Engineering (Cortech) for the purchase of a Portable Trailer Mounted Variable Frequency Drive (VFD) Pump in an amount not-to-exceed $453,000. • It was noted that staff completed a cost benefit analysis to compare alternatives for avoiding disruption of water services while taking existing critical facilities offline for extended periods of time. The analysis also accounted for cost savings the District could realize from simplification of existing pump station replacement concepts. • Staff discussed the selection process and stated that the District received six (6) informal quotes. See Page 3 of the staff report for results of the selection process. • The Committee inquired about the difference between formal and informal quotes. Staff stated that a “formal” quote is used in the context of public works bid process for construction projects. The term “informal” was used in the context of equipment procurement in accordance with the District’s Purchasing Manual. Staff went through an iterative process with all bidders until they received a final quote before adjustments were made by staff to compare the quotes as noted in the staff report. • In response to a question from the Committee, staff stated that the General Manager and Department Chiefs have the authority to approve project cost changes up to $75,000 and $20,000, respectively. • In response to a question from the Committee, staff stated that the seven percent (7%) contingency of $30K added to this award can be considered an allowance for any unforeseen changes to Cortech’s purchase order. The $25,000 contingency line item shown in Attachment B may be utilized for unforeseen expenditures outside of Cortech’s purchase order such as consulting fees or additional staff time if needed. Following the discussion, the committee supported staff’s recommendation and presentation to the full board as a consent item. ATTACHMENT B – Budget Detail SUBJECT/PROJECT: P2640-001103 Approval to Purchase a Portable Trailer Mounted Variable Frequency Drive Pump 5/31/2019 Budget 550,000 Planning Standard Salaries 30,010 30,010 - 30,010 Total Planning 30,010 30,010 - 30,010 Design 001102 Standard Salaries 23,658 23,658 - 23,658 Total Design 23,658 23,658 - 23,658 Construction 453,000 - 453,000 453,000 Cortech including sales tax & 7% contingency 15,000 - 15,000 15,000 Staff Time 25,000 - 25,000 25,000 Contingency Total Construction 493,000 - 493,000 493,000 Grand Total 546,668 53,668 493,000 546,668 Vendor/Comments Otay Water District p2640-Portable Trailer Mounted VFD Pumps Committed Expenditures Outstanding Commitment & Forecast Projected Final Cost STAFF REPORT TYPE MEETING: Regular Board Meeting MEETING DATE: July 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 7-03-19.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: BOARD WORKSHOPS: STAFF REPORT TYPE MEETING: Regular Board Meeting MEETING DATE: July 3, 2019 SUBMITTED BY: Tenille M. Otero PROJECT: Various DIV. NO. All APPROVED BY: Mark Watton, General Manager SUBJECT: Informational Item: Conservation Program Update GENERAL MANAGER’S RECOMMENDATION: No recommendation. This is an informational item only. COMMITTEE ACTION: See Attachment A. PURPOSE: To inform the Board of Directors about the various conservation programs and services offered through the District, the San Diego County Water Authority and the Metropolitan Water District of Southern California. ANALYSIS: The Otay Water District offers many programs and services to assist and educate its customers on water-use efficient practices. Historically, the District’s customers have taken advantage of many of the available conservation programs. The District’s overall water use reflects a conservation-minded customer base. Due to an unusually wet month, May 2019 usage was 28 percent lower than May 2013. Since May 2018, customers have saved an average of 14 percent over 2013 levels. Background On April 7, 2017, Governor Jerry Brown issued an executive order officially ending the drought state of emergency in most of California. The Governor also released the state’s long-term plan to better prepare the state for future droughts and make conservation a way of life. Also, in April 2017, the State Water Resources Control Board (SWRCB) rescinded the conservation mandates, but continued the water-use reporting requirements and prohibitions against wasteful practices. As part of the Governor’s mandate, the SWRCB adopted Resolution No. 2016-0029, which allowed individual suppliers to self- certify that there would be no supply shortfall assuming three additional dry years. With the certification of the Claude “Bud” Lewis Carlsbad Desalination Plant, additional water storage capacity, and upgraded conveyance systems, the San Diego region’s water agencies demonstrated the ability to provide sufficient water supplies to meet customer demands, assuring there would be no supply shortfall during three additional dry years. Building on efforts to make water conservation a way of life and to prepare the state better for droughts and climate change, on May 31, 2018, Governor Brown signed two bills into law – Senate Bill 606 and Assembly Bill 1668 – that establish permanent water-use restrictions throughout California. The laws outline an overall framework to guide the District and other urban water suppliers in setting water-use targets. The District has been working with the San Diego County Water Authority, other water agencies, and state officials to define how the new laws will be implemented, ensuring the regulations are both equitable and reflect local conditions. As part of its efforts to keep stakeholders engaged in the conservation legislation (AB 1668 and SB 606), in May 2019, the SWRCB held its first quarterly Urban Overview Meeting. Although the quarterly meetings are informational, the SWRCB’s goal through the meetings will be a way of keeping everyone apprised of the big picture through progress reports back from each of the eight urban project workgroups. The workgroups, six of which are new, consist of the following: Model Water Efficient Landscape Ordinance; Landscape Area Measurement; Wholesale Water Loss; Water Use Studies; Standard, Methodologies and Performance Measures; Urban Water Management Plan Guidebook; Annual Water Supply and Demand Assessment; and Data Streamlining. To broaden the state’s approach on water as California faces a range of existing challenges, on April 29, 2019, Governor Newsom issued Executive Order N-10-19. The order directs the secretaries of the California Natural Resources Agency, California Environmental Protection Agency, and the California Department of Food and Agriculture to identify and assess a suite of complementary actions to ensure safe and resilient water supplies, flood protection and healthy waterways for the state’s communities, economy and environment. Water Conservation Programs To offer its customers opportunities to increase water-use efficiency and potentially save money, District staff has worked closely with the San Diego County Water Authority (CWA) and the Metropolitan Water District (MWD) to offer a variety of water-use efficiency programs. The programs are listed below. • Rebate Program The District offers available rebates for residential and commercial, industrial, and institutional customers through MWD’s SoCal Water$mart Rebate Program. Funding for the program is through a partnership between MWD and its member agencies throughout Southern California. In fiscal year 2019 to date, $209,338.20 in device rebate funding from the District, CWA, and MWD was paid to District customers. Through this program, during the same time period, a total of 455 water-use efficient devices were purchased by or distributed to District customers. In fiscal year 2019, the District supplemented additional funding to MWD’s program for Weather Based Irrigation Controllers (WBIC) for landscapes under one acre and for High- Efficiency Washers (HEW). The District provided an additional $40 to MWD’s $80 incentive for WBICs and an additional $50 to MWD’s $85 incentive for HEWs. • Turf Replacement Program Through MWD’s Turf Replacement Program, the District offers a minimum of $2 per square foot to replace residential and commercial turf with water-efficient landscape. CWA currently offers the District’s customers an additional $1.75 for residential projects depending on availability of funding. In fiscal year 2019 to date, 12 District customers completed the program, receiving $43,168 in rebate incentives and replacing 13,230 square feet of turf with water-efficient landscapes. • WaterSmart Checkup The WaterSmart Checkup program includes free, site-specific water- saving recommendations from certified irrigation professionals. If a customer owns or manages a commercial, multifamily, industrial, public or single-family property, they may qualify. Single-family home checkups also include recommendations to increase indoor water-use efficiency. The District contracts this service through the Water Authority’s regional service provider, Mission Resources Conservation District. Since July 1, 2018 through December 6, 2018, 14 District customers (11 single-family and 3 commercial) have participated in the program. • WaterSmart Landscape Makeover Program Based on the first edition of the CWA’s Homeowner’s Guide to a WaterSmart Landscape, the free program is designed to empower homeowners with the skills and knowledge necessary to convert a turf area into a WaterSmart landscape. The program offers a four- class series, a three-hour design workshop, and videos on demand. The program also offers events and resources for creating a WaterSmart landscape. In fiscal year 2019 to date, seven District customers have participated in the program, converting approximately 7,523 square feet of landscape to a more water- efficient one. • Qualified Water Efficient Landscaper (QWEL) Training The QWEL program, which launched in January 2016, offers free local training to landscape professionals. It provides them with 20 hours of education on principles of proper plant selection for the local climate, irrigation system design and maintenance, and irrigation system programming and operation. Since the program began, CWA has offered two trainings at Cuyamaca College and one at Southwestern College with 35 participants achieving their QWEL certification. Currently, a second class at Southwestern College is enrolling and will begin in August. • Sustainable Landscape Program (SLP) The SLP pilot program, funded by the Department of Water Resources, provided residential customers with financial incentives for converting their water thirsty lawns into sustainable landscapes that included climate-appropriate plants, high-efficiency irrigation, soil amendments and rainwater detention features. In addition to financial incentives, the SLP offered a suite of other resources for homeowners, including a 71-page San Diego Sustainable Landscape Guidelines publication, landscaping classes and materials, and technical assistance through personalized design coaching. Since the SLP launch in October 2016, nine District customers have participated in the program with a total of 14,668 square feet of former turf areas upgraded to sustainable landscaping standards, receiving a total of $25,660.58 in incentives. The program’s funds were expended and the program ended in April 2019. Since the close of the SLP, participants can now participate in MWD’s Turf Replacement Program. Contests • WaterSmart Landscape Contest The annual contest rewards San Diego County residents who have created beautiful landscapes with water-wise features and demonstrate the best water conservation practices in their yard. District staff selects one winner as the “Best in District” and awards a $250 nursery gift card, goodie bag, yard sign, and other promotional materials. This year’s winner will be recognized at the July Board meeting. • Student Art Calendar Contest MWD’s annual “Water is Life” Student Art Calendar and Exhibit Tour showcases student artwork with imaginative messages of water conservation and stewardship. Elementary schools, grades K-6, within the District’s service area had the opportunity to enter the contest in 2019 for a chance to have their artwork featured in the 2020 calendar. District staff selected six winners from District schools. MWD will then select 36 art pieces from all participating water agencies to be featured in the “Water is Life” calendar with a distribution of 11,000. During the 2019 school year, the District received 247 submittals from 45 schools within the District’s service area. Educational Programs The District has resources available on its website for teachers and students to learn more about water-use efficiency. For teachers, information is provided about District-sponsored contests, bus tours to the Water Conservation Garden, Splash Labs, and water education websites. For students, there is information about the contests, EPA watershed resources, State of California water resources, and more. In addition, the District financially subsidizes Water Conservation Garden field trips and assemblies through the Ms. Smarty Plants program. In fiscal year 2019, the District funded up to 35 school bus tours to the Water Conservation Garden to learn from Ms. Smarty Plants. Schools contact the Garden directly to schedule their field trips or assemblies. To date, in fiscal year 2019, 33 classes (29 field trips to the Garden and four assemblies) and more than 3,100 students from the District’s service area have learned from Ms. Smarty Plants about water conservation. As a member of CWA, the District helps fund the below programs through the CWA. • School-wide Assemblies CWA provides elementary school assemblies at no cost to the school. The following options are available: 1) “H20, Where did you go?” for schools with more than 700 students, 2) “Waterology” for schools with a minimum of 200 students, and 3) “Hydro Game Show” with a minimum enrollment of 200 students. In fiscal year 2019 to date, CWA provided assemblies for 16 classes in four District schools, reaching more than 1,000 students. • Splash Lab & Green Machine The Splash Science Mobile Lab is a self-contained mobile science laboratory that comes to schools to educate students, grades four through six, on the impact of water pollution on the environment and the importance of water conservation. The Green Machine, designed for grades K-4, is a mobile field trip to educate students on the importance of a healthy environment. The District, funds up to four Splash Lab or Green Machine visits per year. In addition to the District’s funding, MWD approved the CWA’s application for Splash Lab funding via the Member Agency Administered Program Funding. Approximately $75,000 is available to fund additional Splash Lab visits for each of the CWA’s member agencies for the 2019 and 2020 school years. Staff works with the CWA and the San Diego County Office of Education to promote and schedule these visits. District staff will continue to promote water-use efficiency programs and services offered to customers and participate in interagency conservation meetings to remain updated on the latest information. FISCAL IMPACT: Joe Beachem, Chief Financial Officer This is an informational item only and has no fiscal impact. All programs are included in the Water Conservation budget. The budgeted costs for fiscal year 2019 are $198,500. The fiscal year 2020 approved budget is $176,000. Costs of the District’s conservation programs are also incorporated into the general cost of water paid to CWA and MWD. STRATEGIC GOAL: Execute and deliver services that meet or exceed customer expectations, and increase customer engagement in order to improve District Services. LEGAL IMPACT: None. Attachments: A) Committee Action ATTACHMENT A SUBJECT/PROJECT: Informational Item: Conservation Program Update COMMITTEE ACTION: The Public Relations Legal and Legislative Committee (Committee) reviewed this item at a meeting held on June 25, 2019 and the following comments were made: • Staff provided an update on the various conservation programs and services offered through the District, the San Diego County Water Authority (CWA) and the Metropolitan Water District of Southern California (MWD). • Staff reviewed information in the staff report. • Staff indicated in response to an inquiry from the Committee, that the Educational Programs are available to all schools within the District’s service area. Coordination is mainly with public schools, however, if a private or Montessori school expressed interest, the District would evaluate how to best accommodate them. Staff indicated that District staff is working with the San Diego County Office of Education to promote the education programs. Staff will explore conducting additional outreach with schools other than public schools within the District’s service area. Staff also mentioned that the CWA creates an educational poster and distributes those to San Diego County schools. • The Committee suggested that staff evaluate how the mobile Splash Lab Program could potentially be integrated with the HydroStation Program. Staff indicated they would review that possibility. • It was discussed that the Splash Lab and Green Machine Programs are not utilized by schools as much as they were in the past as there is a set curriculum that teachers must follow and these programs are not a part of the curriculum. Additionally, legal counsel stated that the Teachers Union requires that students receive an established amount of instruction “minutes” of the curriculum and will protest if they feel that students are not getting this instruction time. Staff did however, said they will work with the San Diego County Office of Education and the CWA to promote the programs more. • The Committee inquired about the status of the Water Conservation Garden (WCG). It was indicated that the WCG marketing committee has been meeting monthly to bi-monthly. The committee consists of the PIO’s and/or conservation staff from the JPA member agencies. The WCG is currently experiencing a transitional period as it has a new Executive Director and new employees who are currently engaged in determining what programs have been done in the past and in developing new programs and strategies for the WCG. Staff is expecting that processes at the WCG should improve as we get closer to the end of the year. • Staff shared that the District’s annual contribution to the Garden decreased in fiscal year 2019 to $96,000 from $96,450 (FY18) and will decrease again in fiscal year 2020 to $92,000. • It was discussed that schoolteachers who have taken their students on a field trip to the WCG have been happy with the program. The District has budgeted for up to 35 field trips for the last couple of years and typically all 35 tours are utilized by the schools. The teachers who have participated have completed survey forms providing their feedback on the WCG tour and the Ms. Smarty Plants program. Staff can share copies of the surveys with the board. • The Committee inquired about the rebate programs and suggested that the information about available rebates for new appliances, turf replacement, etc., be added to the new customer “Welcome Letter” that is sent by the Customer Service department. Upon completion of the discussion, the committee supported staff’s recommendation and presentation to the full board as an informational item. STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: July 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: • Easement and Encroachment Mobile App – Along with the development of the desktop application, staff completed the initial design of the smartphone app for the easement and encroachment project. The prototype has been presented to Engineering and Operations staff for review and field test. The two applications will work directly with the enterprise GIS database to share information collected by staff in the office or in the field. This integrated approach will streamline the easement/encroachment data collection and sharing process. Human Resources: • Deferred Compensation Plan Financial Advisor/Consultant - The District conducted a request for quote and entered into a one-year contract ($23,000/year) with Sageview Advisory Group to act as co- fiduciary to the District’s Employee Deferred Compensation Plan. This contract can be extended for up to two additional years for the same annual cost. The consultant will be working with a District committee to select investment options, conduct employee meetings during the transition in deferred compensation carriers, and the committee and consultant will meet on a semi-annual basis to review and monitor for performance of the investment options. • Deferred Compensation Plan Review - The District completed the review of quotes received from five providers for the District’s Deferred Compensation Plans. The District currently offers plans through Nationwide and ICMA-RC. A committee was selected to assist with the review process, which included the Chief Financial 2 Officer, Assistant Chief Financial Officer, Chief of Administrative Services, Human Resources Manager, Human Resources Analyst, and two members of the Employee Association. The committee selected Voya Financial and the District will be working with the carriers to implement the changes by the end of 2019. This will be a positive change for the employees, resulting in significant fee savings for employees. • Performance Evaluation Refresher Training - Human Resources conducted refresher training to provide tips on how to streamline the process and provide valuable reviews for employees. Managers and supervisors will be completing the annual performance evaluations during the months of June and July. • Recruitments: o The District is currently recruiting for an Executive Assistant; preparing to recruit for a Laboratory Analyst; and, is in the selection process for a Utility Worker I/II. o These positions are critical to District operations. IT Operations: Enterprise Fleet Management System Evaluation - Staff completed the evaluation of several GPS fleet management software vendors for the replacement of the District’s current system. The team assessed the vendor’s proposed reliability, tracking, analytics, reporting and customer service support. Given the evaluation results, staff will be recommending Samsara Inc. as the District’s new GPS fleet management system. Monthly GPS coverage and services will be charged to the IT Department’s FY20 Operational Budget. A one-time cost for the hardware devices is $6,100. The total cost of devices and services for the 3-years totals $73,210. It is anticipated that the system will be deployed at the beginning of the new fiscal year. • Monthly Board Audio Streaming - During the District’s June Board meeting, 11 customers engaged in the listening of the live monthly meeting. The live audio broadcast was aired for 2 hours and 29 minutes. Purchasing & Facilities: • San Diego County Hazardous Materials Division (HMD) Compliance Inspection – The San Diego County Department of Environmental Health (DEH) completed its annual inspection of the District’s Fuel Island. DEH found the District to be in compliance in both operations and recordkeeping. A minor violation related to the diesel spill bucket cover not maintaining a “liquid-tight hold” when it rains was repaired during the inspection and was observed 3 to hold against further water intrusion. No additional corrections were noted, and no further recommendations were made. Due to a heavy workload and being new to the position, the DEH inspector did not conduct a review of the District’s remaining facilities for hazardous materials compliance, but advised that a full inspection would be conducted at the next meeting in May 2020. The annual pre- HMD staff meeting held in April and the ongoing efforts by Engineering, Fleet, Facilities and Environmental staff helps to ensure that the District remains hazardous materials compliant. • Public Services, Customer Service, and Lobby Enhancements Update: o Public Service Conference Room – A solicitation to expand and harden the conference room will be issued at the end of June to time with the availability of 2020 funding. The solicitation is to include demolition of the existing conference room, the framing, drywall, paint and the incorporation of ballistic protection for an expanded conference room. o Lobby Enhancements – The Public Services Conference Room solicitation will include the demolition of the Lobby feature walls including repair and paint at the customer entrance and in front of the Board room, where a bench seat will be installed to cover the exposed floor and provide a sitting area for customers. Similarly, a concrete planter will be installed at the customers entrance to cover the exposed floor at that location. o Customer Service Desk Barrier Glass - A solicitation for barrier glass has been issued with a close date of June 27, 2019, for approximately 140 sq. ft. of Level 2 ballistic material. Combined with the desk, the glass will provide an eight-foot (8’) protective barrier between customers and service staff. Depending on material fabrication lead time and contractor schedule, installation is planned for late July into early August. • BidSync Solicitations - Currently there is one (1) solicitation advertised on BidSync: o “As-Needed Electrical Engineering Consulting Services FY 2020- 2022” – For the services of an engineering consulting firm to provide professional Plan Check Services in support of the Public Services Division in processing and performing plan review for developer potable water and recycled water projects on an as-needed basis, for a period of three fiscal years (FY2020 - FY 2022) in an amount not-to-exceed $175,000. This solicitation closes on July 19, 2019 4:00:00 PM PDT. 4 Safety & Security: • America’s Water Infrastructure Act of 2018 (AWIA 2018) -- UPDATE – SDCWA has taken the lead to develop an RFP for a risk assessment consultant to assist local member agencies with meeting the AWIA requirements to complete a Risk and Resiliency Assessment (RRA) and Emergency Response Plan (ERP). The cost of the consultant would be shared by the participating agencies. The last assessment completed in 2004 had a cost of $90,000 (for FY20, Safety & Security has budgeted $30,000). Free EPA training is available on the AWIA 2018 requirements and tools. Note: EPA is still in the process of developing final guidelines, which are estimated to be completed and available at the end of August 2019. The deadline for compliance is March 2020 for the RRA, and September 2020 for the ERP. Fines of $25,000 per day may be assessed for non-compliance. • Regulatory Training & Testing - All affected staff successfully completed the annual required: o Hearing Conservation Training and Testing o Respiratory Protection o Quantitative Testing • HAZWOP and Emergency Response Team – The team completed regulatory compliant HAZWOP team training and exercise. On June 26th and 27th, the team participated in a joint confined space training and rescue exercise with Cal Fire rescue teams. • Monthly WebEOC Emergency Preparedness Exercise: o EOC staff completed the last exercise for FY 2019. The exercise consisted of: “Locate the Sample Action Plan for Earthquakes under Plugins, File & map library, Sample Planning documents. The water sector is under the Ops Construction & Engineering branch”. The document was located, downloaded, and added to the District’s internal website. o EOC staff also received information on the required elements for AWIA-2018 and its compliance, EPA’s available free training, and a copy of EPA’s AWIA guidelines. • Safety Committee – The committee held its quarterly meeting on June 18. Topics covered and discussed included: Service Truck Crane Operator Certification Cal/OSHA Requirements; Confined Space GIS Layer; Safety Boots and Prescription Safety Glasses; Heat Illness Prevention Quick E-Tool; Active Shooter; Cal/OSHA Guide Safety Training Requirements; and, a demo on the District’s 5 internal Safety & Security site. The next meeting is scheduled for September 17, 2019. • Bionomics Training – On June 3rd, Dr. Clapper spent half a day (cost-free) providing a follow-up to the March 12th, 13th and 14th District-wide employee bionomics training sessions. Dr. Clapper conducted field visits and a group stretch exercise session with field staff. This was welcomed by staff and positive feedback was received. Operations field staff have made bionomics stretching part of their daily routine. Finance: • FY 2020 Budget - Staff is preparing the 2020 budget books, and anticipate completion by the September/October timeframe. The budget books are an excellent communication tool to share with our customers and other interested parties. Staff will also submit the books to the GFOA and CSMFO award programs. The deadline for submission to the award programs is October 31, 2019. • FY 2020 Rate Notices – Staff is preparing Rate Increase Notices, effective January 1, 2020, which are scheduled to be mailed to customers in the July/August timeframe. • Chula Vista Sewer Billing – The City of Chula Vista is considering placing their sewer charge on the County Tax Role. It is the City’s option to terminate this service. If this were to happen, the District would no longer bill for the City of Chula Vista sewer. The District would remain, however, under contract to provide customer water meter reads to the City, • Audit – Teaman, Ramirez & Smith completed the interim audit field work on May 22nd. The final audit field work is scheduled for August 26th to 29th. • Large Meter Replacement CIP - Beginning in FY 2017, a CIP for the replacement of large meters was established. Many of the District’s large meters were nearing end of life and, recognizing the importance of large meter accuracy, a replacement program was implemented. The District currently has 237 meters in the ground, sized 3” or larger, representing less than .5% of the total meters in the District. However, these meters record approximately 15% of the District’s total annual water consumption. Since the program was put into place in FY 2017, 113 large meters have been replaced with 43 of them replaced this year. The decision to replace the meters is based on annual test data that comes from the District’s large meter testing program as well as a cost benefit analysis for each meter to ensure the replacement cost is offset by more accurate water usage readings. 6 Financial Reporting: • The financial reporting for May 31, 2019 is as follows: o For the eleven months ending May 31, 2019, there are total revenues of $90,972,226 and total expenses of $92,718,355. The expenses exceeded revenues by $1,746,129. Total rainfall was 12 inches for the eight-month period between October 2018 and May 2019, compared to 3.3 inches for the same period of October 2017 to May 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 May 31, 2019 is as follows: o The market value shown in the Portfolio Summary and in the Investment Portfolio Details as of May 31, 2019 total $72,588,783 with an average yield to maturity of 1.877%. The total earnings year-to-date are $1,121,432. 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 Pump Stations. The project also includes the replacement of the existing liner and cover for the 571-1 Reservoir (36.7 MG). In late May 2019, the contractor took delivery and installed the station’s pumps into the Pump Room. During the month of June 2019, Pacific Hydrotech, the District’s construction contractor, continued work on the station’s interior, including the installation of electrical systems and fire sprinkler systems. It is anticipated that the station’s engines will be delivered to the project in late June/early July 2019. Alta Road tie-in work for the Station’s electrical, gas, and sewer utility piping is anticipated in July 2019. Environmental compliance during construction is being monitored by Helix Environmental. A Least Bell’s Vireo nest was located on the County of San Diego’s property adjacent to the project site. Noise blankets to mitigate construction noise are being maintained on the existing property fence with approval granted by the County of San Diego. The project is within budget and scheduled to be completed 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 7,420 linear feet of new 15-inch gravity sewer pipe and includes abandonment of the existing sewer main. The project’s construction is guided by traffic lane closure permits that limit the work within the traveled way to night time hours. The project’s environmental permit also limits work adjacent to the environmentally sensitive area during the months of February through September. The contractor completed installation of the planned sewer facilities and reopened the Campo Road lanes with temporary striping in June 2019. The contractor also began the installation of new sewer across Via Mercado. This project is within budget and it is anticipated that the overall project, which includes the abandonment of the existing sewer located in the environmentally sensitive area along Campo Road, will be completed in December 2019. (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 June 2019, the District’s construction contractor Cass Arietta, began the installation of the new water main in Vista Vereda. Overall this project is within budget and completion of the construction is scheduled for September 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) purchase agreement may be revised to include a Selective Catalyst Reduction (SCR) emissions control system to facilitate permitting with the Air Pollution Control District (APCD) of San Diego County. The proposed SCR emission controls system was submitted to APCD on April 22, 2019. A public works bid package, including grading, mechanical, structural, electrical, instrumentation & control, and installation of the trailer is scheduled for award at the July 2019 board meeting. Two bid protests were received and analyzed by staff and legal counsel and they concluded that the project should be awarded to the lowest responsible bidder since the bid protests did not have merit. (P2619) 8 • 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 was bid and awarded with the District’s 870-2 Pump Station project. The remainder of the second phase was awarded to M-Rae Engineering, Inc. During June 2019, M-Rae substantially completed work on the project and began the completion of punch list items needed for contract acceptance. This project is within budget and scheduled to complete in June 2019. (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. During June 2019, Layfield, the construction contractor for the project, completed punch list items associated with preparing the reservoir for disinfection and filling. It is anticipated that the reservoir will be filled in June in preparation for placing the reservoir back in service. The project is within budget and scheduled to be completed in June 2019. (P2561) • 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 June 2019, Advanced Industrial Services, the construction contractor for the project, completed the blasting and coating work for the Reservoir’s interior shell and floor. It is anticipated that the contractor will install scaffolding, wrap the reservoir exterior and begin exterior blasting in July 2019. The project is within budget and scheduled to complete in August 2019. (P2565) • RWCWRF Fuel Lines Replacement: Existing below grade fuel oil piping, which was partially installed with the original treatment plant, 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 contractor, Jauregui & Culver, completed the installation of the new below grade fuel lines and placed the lines into service on April 29, 2019. The project’s fuel return tank is being fabricated. The contractor is scheduled to remobilize and install the new return tank in August 2019. The project is within budget scheduled to be completed in August 2019. (R2147) 9 • Portable Trailer Mounted VFD Pumps: This project consists of procurement of a portable trailer mounted hydropneumatic pump station designed for deployment at up to seven (7) existing sites including four (4) 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. Initial quotes were received and analyzed in January 2019. Final quotes were received in May 2019. The award to procure a single trailer is scheduled for the July Board meeting. This project is on schedule. (P2640) • 1485-2 Pump Station Diesel Fuel Leak: The District’s Pump Station has a standby diesel fuel generator to provide power in case of an emergency with a 500-gallon diesel fuel tank that provides fuel to the generator through black iron pipe. The underground segment of black iron pipe between the tank and the generator does not have secondary containment. On June 5, 2019, a property owner of the land adjacent to the Pump Station noticed small staining on the retaining wall and what appeared to be some type of fuel oil (due to the odor). It was brought to the attention of District water system operators at the site. District staff closed the valve from the storage tank, evacuated the fuel from the lines, and potholed the pavement along the line to try to determine the location of the leak. The District’s fleet shop supervisor estimates that the quantity of fuel that leaked was about 100 gallons and that it was a slow leak, probably occurring over a year or longer. Although the majority of the fuel was contained on District property, and out of an abundance of caution, the County of San Diego (County) Department of Environmental Health and the Office of Emergency Services were notified of the leak on June 6, 2019. District staff is working with geotechnical and environmental consulting firms to prepare a work plan to remediate the impact of the leak on the District’s property and the adjacent property owner’s site. Staff will be seeking the assistance of County staff in the review and approval of the work plan that will be developed for remediation of the spill and for guidance on any additional work that might be needed to ensure that the remediation work will meet all County requirements. It should be noted that staff was already in the process of relocating and replacing the fuel lines at this site based on the recommendation from the consultant. (P1210) • Advanced Locator Training Workshop: District staff was instrumental in organizing the July 19, 2019 “Advanced Locator Training” workshop, which was conducted by Advanced Infrastructure 10 Technologies and held at the Otay Water District. Nineteen (19) attendees were present from various Public Agencies including the District and the Naval Facility-San Diego. Topics ranged from locating theory to problem locate solutions. • For the month of May 2019, the District sold 40 meters (45 EDUs), generating $398,813 in revenue. Projection for this period was 60.8 meters (77.1 EDUs), with budgeted revenue of $672,173. Total revenue for Fiscal Year 2019 is $7,350,725 against the annual budget of $8,066,070. Water System Operations (reporting for May): • On Thursday May 2, a contractor working on a sewer rehabilitation project for the City of San Diego pulled a one-inch air vac lateral line while backfilling on Airway Road in Otay Mesa. Staff performed an unplanned shutdown to install a new service saddle. No customers were affected. The shutdown lasted from 1:00 PM to 3:00 PM. • On Thursday May 9, staff performed an unplanned emergency shutdown at 785 E. Palomar Street to repair a 2-inch air vac lateral leak. One meter for the City of Chula Vista Parks and Recreation was affected. A water trailer was provided. The shutdown lasted from 3:30 PM to 5:30 PM. • On Tuesday May 14, staff performed a planned shutdown on Hidden Mesa and Hidden Trails for the contractor to tie-in a new 12-inch pipeline. Twenty-three residential meters were affected. Three water trailers were on site. The shutdown lasted from 8:00 AM to 7:00 PM. • On Thursday May 16, staff performed a planned shutdown to delete a 2-inch service off of the 18-inch line that runs across the new storage facility by the entrance of the Regulatory site. Three commercial coustomers were affected. Water trailers were on site. The shutdown lasted from 8:00 AM to 5:00 PM. 11 Purchases and Change Orders: • The following table summarizes purchases and Change Orders issued during the period of May 20 through June 20, 2019 that were within staff signatory authority: Water Conservation and Sales: • Water Conservation - May 2019 usage was 28% lower than March 2013. Since May 2018, customers have saved an average of 14% over 2013 levels. Date Action Amount Contractor/ Consultant Project 05/20/19 P.O. $5,000.00 SageView Advisory Group, LLC Retirement Plan Consulting 05/21/19 P.O. $858.09 Protective Life Insurance Co. Annual Life Insurance Premium 06/03/19 P.O. $36,000.00 ACC Business Internet Circuit Services (3 Years) 06/06/19 P.O. $2,500.00 Safety-R-Us, LLC Confined Space Training 06/20/2019 P.O. $18,548.39 Sealright Paving, Inc. Calavo Basin Sewer Rehabilitation- Phase 2 (S2049) 12 • The May potable water purchases were 2,091.9 acre-feet, which is 21.7% below the budget of 2,669.8 acre-feet. The cumulative purchases through May were 24,857.7 acre-feet, which is 11.0% below the cumulative budget of 27,939.7 acre-feet. • The May recycled water purchases and production were 281.8 acre- feet, which is 15.7% below the budget of 334.2 acre-feet. The cumulative production and purchases through May were 3,034.1 acre- feet, which is 5.1% below the cumulative budget of 3,198.0 acre- feet. 13 Potable, Recycled, and Sewer (Reporting up to the month of May): • Total number of potable water meters: 50,699. • Total number of sewer connections: 4,737. • Recycled water consumption for the month of May: o Total consumption: 327.1 acre-feet or 106,585,862 gallons. o Average daily consumption: 3,438,254 gallons per day. o Total cumulative recycled water consumption since July 1, 2018: 3038.4 acre-feet. o Total number of recycled water meters: 729. • Wastewater flows for the month of May: o Total basin flow: 1,620,277 gallons per day. This is an increase of 4.15% from May 2018. o Spring Valley Sanitation District Flow to Metro: 537,669 gallons per day. o Total Otay flow: 1,082,323 gallons per day. o Flow processed at the Ralph W. Chapman Water Recycling Facility: 893,581 gallons per day. o Flow to Metro from Otay Water District: 188,955 gallons per day. • By the end of May there were 6,748 wastewater EDUs.