HomeMy WebLinkAbout06-25-18 EO&WR Committee PacketOTAY WATER DISTRICT
ENGINEERING, OPERATIONS & WATER RESOURCES COMMITTEE MEETING
and
SPECIAL MEETING OF THE BOARD OF DIRECTORS
2554 SWEETWATER SPRINGS BOULEVARD
SPRING VALLEY, CALIFORNIA
Board Room
MONDAY
June 25, 2018
12:30 P.M.
This is a District Committee meeting. This meeting is being posted as a special meeting
in order to comply with the Brown Act (Government Code Section §54954.2) in the event that
a quorum of the Board is present. Items will be deliberated, however, no formal board actions
will be taken at this meeting. The committee makes recommendations
to the full board for its consideration and formal action.
AGENDA
1. ROLL CALL
2. PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC TO
SPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE BOARD'S JU-
RISDICTION BUT NOT AN ITEM ON TODAY'S AGENDA
DISCUSSION ITEMS
3. APPROVE AN INCREASE TO THE CIP P2561 BUDGET IN THE AMOUNT OF
$150,000 AND AWARD A CONSTRUCTION CONTRACT TO LAYFIELD USA COR-
PORATION FOR THE RESERVOIR 711-3 FLOATING COVER AND LINER RE-
PLACEMENT PROJECT IN AN AMOUNT NOT-TO-EXCEED $1,997,000.40 (MAR-
TIN) [5 minutes]
4. APPROVE CALTRANS UTILITY AGREEMENT NO. 33718 FOR SR-11 UTILITY RE-
LOCATIONS ON ENRICO FERMI DRIVE AND ALTA ROAD (MARCHIORO) [5
minutes]
5. REJECT A BID FOR THE CONSTRUCTION OF THE PIPELINE CATHODIC PRO-
TECTION IMPROVEMENTS – PHASE II PROJECT (MARCHIORO) [5 minutes]
6. REJECT ALL BIDS FOR THE CONSTRUCTION OF THE VALVE REPLACEMENT
PROGRAM – PHASE I PROJECT (CAMERON) [5 minutes]
2
7. INFORMATIONAL UPDATE ON THE CURRENT AGREEMENT WITH THE CITY OF
SAN DIEGO, THE CURRENT COST OF RECYCLED WATER, AND ALTERNATIVE
SUPPLY STUDIES (CAMERON) [5 minutes]
8. SAN DIEGO COUNTY WATER AUTHORITY UPDATE (SMITH) [10 minutes]
9. ADJOURNMENT
BOARD MEMBERS ATTENDING:
Tim Smith, Chair
Gary Croucher
All items appearing on this agenda, whether or not expressly listed for action, may be delib-
erated and may be subject to action by the Board.
The Agenda, and any attachments containing written information, are available at the Dis-
trict’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 that would require accommodation in order to enable you to partici-
pate in this meeting, please call the District Secretary at 670-2280 at least 24 hours prior to
the meeting.
Certification of Posting
I certify that on June 22, 2018 I posted a copy of the foregoing agenda near the regu-
lar meeting place of the Board of Directors of Otay Water District, said time being at least 24
hours in advance of the meeting of the Board of Directors (Government Code Section
§54954.2).
Executed at Spring Valley, California on June 22, 2018.
/s/ Susan Cruz, District Secretary
STAFF REPORT
TYPE MEETING: Regular Board
MEETING DATE: July 11, 2018
SUBMITTED BY:
Dan Martin
Engineering Manager
PROJECT: P2561-001103 DIV. NO.
2
APPROVED BY:
Rod Posada, Chief, Engineering
Mark Watton, General Manager
SUBJECT: Approval to Increase the CIP P2561 Budget in an Amount of
$150,000 and Award of a Construction Contract to Layfield USA
Corporation for the Reservoir 711-3 Floating Cover and Liner
Replacement Project
GENERAL MANAGER’S RECOMMENDATION:
That the Otay Water District (District) Board of Directors (Board):
1. Increase the budget for CIP P2561 by $150,000 (increase the CIP
budget for P2561 from $2,150,000 to $2,300,000);
2. Increase the overall FY 2019 CIP budget by $150,000 (increase
the overall FY 2019 CIP budget from $24,239,000 to $24,389,000)
3. Award a construction contract to Layfield USA Corporation
(Layfield); and
4. Authorize the General Manager to execute an agreement with
Layfield for the Reservoir 711-3 Floating Cover and Liner
Replacement Project in an amount not-to-exceed $1,997,000.40
(see Exhibit A for Project location).
COMMITTEE ACTION:
Please see Attachment A.
PURPOSE:
To obtain Board authorization to increase the CIP P2561 budget in the
amount of $150,000 from $2,150,000 to $2,300,000 and to obtain Board
authorization for the General Manager to enter into a construction
contract with Layfield for the Reservoir 711-3 Floating Cover and
2
Liner Replacement Project (Project) in an amount not-to-exceed
$1,997,000.40.
ANALYSIS:
The 16 million gallon 711-3 Reservoir was originally constructed with
its existing reinforced polypropylene (RPP) floating cover and liner
in 2002. In the last few years, the floating cover has been
repeatedly repaired to maintain the integrity of the cover material.
Dive videos taken recently show leaks and sunlight penetrating the
floating cover in many places. The existing cover material typically
has a life expectancy of 20 years. It is no longer cost effective to
continue to repair the existing cover that has reached the end of its
life expectancy. The District has typically replaced polypropylene
covers on other reservoirs at a frequency of approximately 15 years,
which is commensurate with the age of the existing 711-3 Reservoir
existing cover and liner material.
Staff researched the warranty provided by Gundle/SLT Environmental
(GSE Environmental), who acquired the manufacturer of the RPP
material, Serrot International, Inc., on or about February 4, 2002.
GSE Environmental and its affiliates filed for Chapter 11 bankruptcy
in 2014. The warranty provides that GSE Environmental will replace
material only on a prorated basis, if the material fails before the
20 year warranty. The warranty doesn’t include freight charges or
the cost of the labor to make the repairs. Staff calculated and
determined that this would be worth around $40,000 worth of material
to make repairs. Staff attempted to contact GSE Environmental, but
have been unsuccessful. Staff checked with District’s legal counsel
and are still evaluating options.
District staff performed a life cycle cost analysis for the
replacement of the liner and cover with various combinations of
geomembrane materials and concluded that the longer lasting
reinforced chlorosulfonated polyethylene (CSPE) was the best
alternative. The analysis considered replacement frequencies of
materials with dissimilar warranties. The CSPE geomembrane will have
a 30 year warranty. The warranty will not be prorated for the first
15 years, and then prorated for years 16 through 30.
Staff contacted the sole CSPE manufacturer in the United States
(Burke Environmental Products) and the two installation contractors
that are certified to install the CSPE material supplied by Burke
Environmental Products prior to the bid process to encourage them to
submit a bid for the Project. Floating cover installation work is
very specialized.
3
On May 1, 2018, the Project was formally advertised for bid using
BidSync, an online bid solicitation website. The Project was also
advertised in the Daily Transcript and the District’s website.
BidSync provided electronic distribution of the Bid Documents,
including specifications, plans, and addendums. A Pre-Bid Meeting
was held on May 9, 2018, which was attended by both Layfield and
Raven Industries, Inc. Two (2) addenda were sent out to all bidders
and plan houses to address questions and clarifications to the
contract documents during the bidding period. Staff prepared the
contract documents in-house.
Bids were publicly opened on May 31, 2018, and the bid analysis was
completed with the following results:
CONTRACTOR TOTAL BID AMOUNT
1 Layfield (Spring Valley, CA) $1,997,000.40
2 Raven Industries, Inc. (Sioux Falls, SD) $2,791,600.00
The Engineer’s Estimate was $1,750,000 when the Project was initially
advertised; however, District staff added scope via addendum
including a new under-liner geotextile and minor subgrade preparation
estimated at $75,000.
A new under-liner geotextile and minor subgrade preparation was added
during the bid phase based on recommendations by Layfield, Raven, and
the District’s 870-2 Pump Station/Roll Reservoir construction
management/inspection consultant (Michael Baker). The under-liner
geotextile was successfully salvaged on two previous District
floating cover/liner replacement projects (Patzig and Pond 4). The
under-liner geotextile was replaced at the Roll Reservoir due to the
substantial underground work beneath and through the earthen
embankment associated with the 870-2 Pump Station project. Replacing
the geotextile at the Roll Reservoir was proven beneficial to inspect
the subgrade and provide a sound foundation for the long-lasting CSPE
liner material.
A review of the bids was performed by District staff for conformance
with the contract requirements and determined that Layfield was the
lowest responsive and responsible bidder. Layfield 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 May 31, 2020. An internet background search of the company
was performed and revealed no outstanding issues. The references
indicated that Layfield is a well-established and well recognized
company, as well as a recognized leader for development of the
“mechanically tensioned” style cover that is currently in use at the
711-3 Reservoir. Layfield acquired the business assets of CW Neal
Corporation (CW Neal) in April 2004. CW Neal installed the existing
4
711-3 Reservoir floating cover in 2002. Layfield also installed the
District’s three (3) most recent floating cover/liner projects,
including 624-1 Patzig (2013), 927-1R Pond 4 (2014), and 570-1 Roll
(2018).
Staff verified that the bid bond provided by Layfield is valid.
Staff will also verify that Layfield’s Performance Bond and Labor and
Materials Bond are valid prior to execution of the contract.
FISCAL IMPACT: Joe Beachem, Chief Financial Officer
The total budget for CIP P2651, as approved in the FY 2019 budget, is
$2,150,000. Total expenditures, plus outstanding commitments and
forecast including this contract, are $2,300,000. See Attachment B
for budget detail.
Based on a review of the financial budget, the Project Manager
anticipates that with a budget increase of $150,000, the Project will
be completed within the new budget amount of $2,300,000 and the new
overall FY 2019 CIP budget of $24,389,000.
The Finance Department has determined that, under the current rate
model, 100% of the funding will be available from the Replacement
Fund.
STRATEGIC GOAL:
This Project supports the District’s Mission statement, “To provide
high value water and wastewater services to the customers of the Otay
Water District, in a professional, effective and efficient manner”
and the General Manager’s Vision, "A District that is at the
forefront in innovations to provide water services at affordable
rates, with a reputation for outstanding customer service."
LEGAL IMPACT:
None.
DM/RP:mlc
P:\WORKING\CIP P2561 711-3 Reservoir Cover-Liner Replacement\Staff Reports\BD 07-11-18 Staff Report 711-
3 Res Floating Cover-Liner Award.docx
Attachments: Attachment A – Committee Action
Attachment B – Budget Detail
Exhibit A – Location Map
ATTACHMENT A
SUBJECT/PROJECT:
P2561-001103
Approval to Increase the CIP P2561 Budget in an Amount of
$150,000 and Award of a Construction Contract to Layfield
USA Corporation for the Reservoir 711-3 Floating Cover and
Liner Replacement Project
COMMITTEE ACTION:
The Engineering, Operations, and Water Resources Committee
(Committee) reviewed this item at a meeting held on June 25, 2018.
The Committee supported Staff's recommendation.
NOTE:
The “Committee Action” is written in anticipation of the Committee
moving the item forward for Board approval. This report will be sent
to the Board as a Committee approved item, or modified to reflect any
discussion or changes as directed from the Committee prior to
presentation to the full Board.
ATTACHMENT B – Budget Detail
SUBJECT/PROJECT:
P2561-001103
Approval to Increase the CIP P2561 Budget in an Amount of
$150,000 and Award of a Construction Contract to Layfield
USA Corporation for the Reservoir 711-3 Floating Cover and
Liner Replacement Project
5/31/2018
Budget
2,150,000
Planning & Design
Consultant Contracts 4,377 4,377 - 4,377 LAYFIELD USA CORPORATION
Regulatory Agency Fees 50 50 - 50 PETTY CASH CUSTODIAN
Standard Salaries 42,346 40,346 2,000 42,346
Total Planning 46,774 44,774 2,000 46,774
Construction
1,997,000 - 1,997,000 1,997,000 Layfield USA Corporation
100,000 - 100,000 100,000 Standard Salaries
50,000 - 50,000 50,000 CM
106,226 - 106,226 106,226 Contingency @ 5% of const contract
Total Construction 2,253,226 - 2,253,226 2,253,226
Grand Total 2,300,000 44,774 2,255,226 2,300,000
Vendor/Comments
Otay Water District
p2561-Res - 711-3 Reservoir Cover/Liner Replac
Committed Expenditures
Outstanding
Commitment &
Forecast
Projected Final
Cost
OTAY WATER DISTRICT711-3 RESERVOIR COVER REPLACEMENTLOCATION MAP
EXHIBIT A
CIP P2561F
P:\WORKING\CIP P2561 711-3 Reservoir Cover-Liner Replacement\Graphics\Exhibits-Figures\Exhibit A (ALTERNATE) - Staff Report.mxd
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VICINITY MAP
PROJECT SITE
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STAFF REPORT
TYPE MEETING: Regular Board
MEETING DATE: July 11, 2018
SUBMITTED BY:
Jeff Marchioro
Senior Civil Engineer
Bob Kennedy
Engineering Manager
PROJECT: P2453-
005102
P2453-
006102
DIV. NO. 2
APPROVED BY:
Rod Posada, Chief, Engineering
Mark Watton, General Manager
SUBJECT: Approve Caltrans Utility Agreement No. 33718 for SR-11 Utility
Relocations on Enrico Fermi Drive and Alta Road
GENERAL MANAGER’S RECOMMENDATION:
That the Otay Water District (District) Board of Directors (Board)
authorize the General Manager to execute Caltrans Utility Agreement
No. 33718 for SR-11 Utility Relocations on Enrico Fermi Drive and
Alta Road (see attached Exhibit A for Project location, and Exhibit B
for Utility Agreement).
COMMITTEE ACTION:
Please see Attachment A.
PURPOSE:
To obtain Board authorization for the General Manager to execute
Caltrans Utility Agreement No. 33718 for relocation of District
facilities in conflict with SR-11 at Enrico Fermi Drive and Alta
Road.
2
ANALYSIS:
The District and Caltrans completed the first two rounds of
relocations (Caltrans Utility Agreement Numbers 33592 and 33622) in
FY 2016, including relocation of 10-inch, 12-inch, and 18-inch
potable water mains in the vicinity of Sanyo Avenue and a single 6-
inch blow off at the intersection of SR 125 and Otay Mesa Road.
In January 2017, District and Caltrans staff began planning the
relocations of the District’s 12-inch PVC distribution main in Enrico
Fermi Drive and 24-inch and 16-inch ACP transmission mains in Alta
Road. The District’s facilities will be constructed in new bridges
that will be built over the freeway extension to the border.
Responding to a request from Caltrans, staff submitted draft claim
letters dated April 24, 2018 related to the utility conflicts. The
District has prior and superior rights at each crossing. The
District received a Notice to Owner directing the District to
relocate conflicting utilities on May 30, 2018.
The District’s As-Needed Engineering Design Consultant (NV5) designed
the bid documents in Caltrans’ format.
The estimated construction cost for the relocated pipelines and
appurtenances is $2,806,689. The District’s relocations will be
constructed through a construction contract administered by Caltrans
as an integral part of Caltrans’ freeway construction project.
Caltrans will pay the contractor directly. Consequently, the
attached utility agreement does not include construction costs.
The total planning, design, inspection, and closeout costs to be
incurred by the District are estimated at $848,890. The calculated
depreciation cost for all existing pipelines and appurtenances is
$46,723.
The total cost that Caltrans will reimburse the District at
completion of the construction work is estimated at $802,167.
Consistent with the conditions of all other utility agreements
between the District and Caltrans, actual costs may not exceed 125
percent of the estimated cost in the agreement without a revised
amendment being executed.
Caltrans anticipates that the above-described relocations will be
advertised for bid in the fall of 2018. Caltrans intends to start
construction in the fall of 2019.
3
An additional Utility Agreement(s) will be presented to the Board as
SR-11 progresses to a future Port of Entry facility and the U.S.
border with Mexico. A future bridge crossing is anticipated at
Siempre Viva Road.
FISCAL IMPACT: Joe Beachem, Chief Financial Officer
The total budget for CIP P2453, as approved in the FY 2019 budget, is
$4,000,000. Total expenditures, plus outstanding commitments and
forecast, including this agreement, are $2,442,471. See Attachment B
for budget detail.
Based on a review of the financial budget, the Project Manager
anticipates that the budget for CIP P2453 is sufficient to support
the Project.
The Finance Department has determined that, under the current rate
model, 100% of the funding will be available from the Replacement
Fund.
STRATEGIC GOAL:
This Project supports the District’s Mission statement, “To provide
high value water and wastewater services to the customers of the Otay
Water District, in a professional, effective and efficient manner”
and the General Manager’s Vision, "A District that is at the
forefront in innovations to provide water services at affordable
rates, with a reputation for outstanding customer service."
LEGAL IMPACT:
None.
JM/BK:jf
P:\WORKING\CIP P2453 SR-11 Utility Relocations\Staff Reports\BD 2018-07-11 Utility Agreement 33718\BD 07-11-18 Staff
Report SR-11 Utility Agreement No 33718 with Caltrans.docx
Attachments: Attachment A – Committee Action
Attachment B – Budget Detail
Exhibit A – Location Map
Exhibit B – Caltrans signed Utility Agreement
ATTACHMENT A
SUBJECT/PROJECT:
P2453-005102
P2453-006102
Approve Caltrans Utility Agreement No. 33718 for SR-11
Utility Relocations on Enrico Fermi Drive and Alta Road
COMMITTEE ACTION:
The Engineering, Operations, and Water Resources Committee
(Committee) reviewed this item at a meeting held on June 25, 2018.
The Committee supported Staff's recommendation.
NOTE:
The “Committee Action” is written in anticipation of the Committee
moving the item forward for Board approval. This report will be sent
to the Board as a Committee approved item, or modified to reflect any
discussion or changes as directed from the Committee prior to
presentation to the full Board.
5
ATTACHMENT B – Budget Detail
SUBJECT/PROJECT:
P2453-005102
P2453-006102
Approve Caltrans Utility Agreement No. 33718 for SR-11
Utility Relocations on Enrico Fermi Drive and Alta Road
5/22/2018
Budget
4,000,000
Planning/Design/Construction, Utility Agreement Number 33592 (Vicinity of Sanyo Avenue )
Standard Salaries 345,804 345,804 - 345,804
Consultant Contracts 970 970 - 970 ALTA LAND SURVEYING INC
4,901 4,901 - 4,901 NARASIMHAN CONSULTING SERVICES
2,561 2,561 - 2,561 CPM PARTNERS INC
2,763 2,763 - 2,763 V & A CONSULTING ENGINEERS
61,864 61,864 - 61,864 ATKINS
35,400 35,400 - 35,400 ALYSON CONSULTING
520 520 - 520 RFYEAGER ENGINEERING LLC
5,018 5,018 - 5,018 CLARKSON LAB & SUPPLY INC
Professional Legal Fees 121 121 - 121 STUTZ ARTIANO SHINOFF
Service Contracts 2,985 2,985 - 2,985 MAYER REPROGRAPHICS INC
84 84 - 84 SAN DIEGO DAILY TRANSCRIPT
- - - - UNDERGROUND SOLUTIONS INC
1,382 1,382 - 1,382 US BANK
1,382 1,382 - 1,382 US BANK CORPORATE PAYMENT
Construction Contract 48,843 48,843 - 48,843 REGENTS BANK
928,017 928,017 - 928,017 COFFMAN SPECIALTIES INC
Total UA 33592 1,442,615 1,442,615 - 1,442,615
Planning/Design/Construction, Utility Agreement Number 33622 (Blow Off)
Standard Salaries 53,988 53,988 - 53,988
Consultant Contracts 13,480 13,480 - 13,480 DARNELL & ASSOCIATES INC
3,786 3,786 - 3,786 ICF JONES & STOKES INC
2,875 2,875 - 2,875 ATKINS
6,000 6,000 - 6,000 ALYSON CONSULTING
Parking and Tolls 12 12 - 12 PETTY CASH CUSTODIAN
Professional Legal Fees 180 180 - 180 STUTZ ARTIANO SHINOFF
Service Contracts 2,310 2,310 - 2,310 MAYER REPROGRAPHICS INC
96 96 - 96 SAN DIEGO DAILY TRANSCRIPT
Construction Contract 66,253 66,253 - 66,253 TC CONSTRUCTION CO INC
1,986 1,986 - 1,986 COUNTY OF SAN DIEGO
Total UA 33622 150,966 150,966 - 150,966
Planning/Design/Construction, Utility Agreement Number 33718 (Enrico Fermi Drive & Alta Road)
Standard Salaries 266,989 84,989 182,000 266,989
Consultant Contracts 227,115 136,585 90,530 227,115 NV5 INC
380 380 - 380 WATER SYSTEMS CONSULTING INC
600 600 - 600 MICHAEL D KEAGY REAL ESTATE
200,000 200,000 200,000 Inspection
100,000 100,000 100,000 Construction Management
5,000 5,000 5,000 As-Needed Corrosion Engineer
48,806 48,806 48,806 Contingency @ 12% of const phase
Total UA 33718 (Enrico Fermi)848,890 222,554 626,336 848,890
Grand Total 2,442,471 1,816,134 626,336 2,442,471
Reinbursement Agreements
UA 33592 (1,400,609) CALTRANS FINAL PAYMENT
UA 33622 (143,966) CALTRANS FINAL PAYMENT
UA 33718 (802,167) CALTRANS UTILITY AGREEMENT
Grand Total (2,346,742)
Vendor/Comments
Projected Final
Cost Vendor/Comments
Otay Water District
p2453-SR-11 Utility Relocations
Committed Expenditures
Outstanding
Commitment &
Forecast
Projected Final
Cost
OTAY WATER DISTRICTSR-11 UTILITY RELOCATIONSLOCATION MAP
EXHIBIT A
P2453P:\WORKING\CIP P2453 SR-11 Utility Relocations\Graphics\Exhibits-Figures\REVISED P2453 Exhibit A - Staff Report.mxd
Otay CrossingsCommerce Park?ÜFUTURE
FUTURE
?Ü
FUTURE PORTOF ENTRY
MEXICO
U.S.A.
Alta Rd
Otay Mesa Rd
Enrico Fermi Dr
CA-11 E
A v en i da In te r n a c io n al O t a y
Airway Rd
Marconi Dr
Donovan State Prison Rd
Paseo de la Fuente
Calzada de la Fuente
Siempre Viva Rd
Via de la Amistad
Access Rd
Kuebler Ranch Rd
VICINITY MAP
PROJECT SITE
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DIV 2
DIV 4
DIV 3
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24 IN WATER PIPELINE
24 IN WATER PIPELINE
16 IN WATER PIPELINE
12 IN WATER PIPELINE
POTABLE WATER PIPELINE
Legend
UA 33718
STATE OF CALIFORNIA • DEPARTMENT OF TRANSPORTATION
UTILITY AGREEMENT
RW 13-5 (REV 12/201 6)
DISTRICT
I
COUNTY
I
ROUTE
11 SD 11
FEDERAL PARTICIPATION
P011 (006)
FEDERAL PARTICIPATION
On the Project lSI Yes 0No
POST MILE
I
PROJECT ID
I 0.0-2.80 1100020520
OWNER'S FILE NUMBER
P2453-005102 & P2453-006102
On the Utilities lSI Yes 0No
Owner Payee Data No. VC000002091 0 or Form STD 204 is attached D
UTILITY AGREEMENT NO. 33718 DATE __ .;...__ __
Page I of 4
EA
056331
The State of California, acting by and through the Department of Transportation, hereinafter called "STATE", proposes to
construct SR-11 from Enrico Fermi Dr. to the proposed port of entry at the Mexico border.
NAME: Otay Water District
ADDRESS: 2554 Sweetwater Springs Blvd., Spring Valley, CA 91978
hereinafter called "OWNER," owns and maintains a 12-inch pipeline within Enrico Fermi Drive and a 16-inch and 24-inch
pipelines within Alta Road within the limits of STATE'S project which requires relocation to accommodate STATE's
project.
It is hereby mutually agreed that:
I. WORK TO BE DONE
In accordance with Notice to Owner No. 33718 dated May 30, 2018, STATE shall relocate OWNER's water facilities as
shown on OWNER's plans prepared by NV5 with final revision date of May 23, 2018, which plans are included in STATE's
Contract Plans for the improvement of State Route 11 , EA 056331 which, by this reference, are made a part hereof.
Deviations from the OWNER's plan described above initiated by either the STATE or the OWNER, shall be agreed upon
by both parties hereto under a Revised Notice to Owner. Such Revised Notices to Owner, approved by the STATE and
agreed to/acknowledged by the OWNER, will constitute an approved revision of the OWNER's plan described above and
are hereby made a part hereof. No work under said deviation shall commence prior to written execution by the OWNER of
the Revised Notice to Owner. Changes in the scope of the work will require an amendment to this Agreement in addition
to the revised Notice to Owner. OWNER shall have the right to inspect the work by STATE's contractor during
construction. Upon completion of the work by STATE, OWNER agrees to accept ownership and maintenance of the
constructed facilities and relinquishes to STATE ownership of the replaced facilities, except in the case of liability
determined pursuant to Water Code 7034 or 7035.
II. LIABILITY FOR WORK
Existing facilities are located in their present position pursuant to rights superior to those of the STATE and will be
relocated at STATE expense.
Ill. PERFORMANCE OF WORK
OWNER shall have access to all phases of the relocation work to be performed by STATE, as described in Section I
above, for the purpose of inspection to ensure that the work is in accordance with the specifications contained in the
Highway Construction Contract; however, all questions regarding the work being performed will be directed to STATE's
Resident Engineer for their evaluation and final disposition.
Engineering services for preparation of plans, specifications, and estimates are to be furnished by the consulting
engineering firm of NV5 on a fee basis previously approved by STATE. Cost principles for determining the
reasonableness and allowability of consultant costs shall be determined in accordance with 48 CFR, Chapter 1, Part 31 ;
23 CFR, Chapter 1, Part 645; and OMB Circular A-87, as applicable.
ADA Notice: For individuals with sensory disabilities, this document is available in alternate formats. For alternate formal inform ation, contact the Forms
Management Unit at (9 16) 445-1 233, TTY 711 , or write to Records and Forms Management, 11 20 N Street, MS-89, Sacramento, CA 958 14.
UTILITY AGREEMENT (cont.)
RW 13-5 (REV 12/2016)
Page 2 of4
I UTILITY AG REEMENT NO. 33718
Use of out-of-state personnel (or personnel requiring lodging and meal per diem expenses) will not be allowed without
prior written authorization by State's representative. Requests for such authorization must be contained in OWNER's
estimate of actual and necessary relocation costs. Accounting Form FA 1301 is to be completed and submitted for all
non-State personnel travel per diem. OWNER shall include an explanation why local employee or contract labor is not
considered adequate for the relocation work proposed . Per Diem expenses shall not exceed the per diem expense
amounts allowed under the State's Department of Personnel Administration travel expense guidelines.
IV. PAYMENT FOR WORK
The STATE shall pay its share of the actual and necessary cost of the herein described work within 45 days after
receipt of OWNER's itemized bill, signed by a responsible official of OWNER's organization and prepared on
OWNER's letterhead, compiled on the basis of the actual and necessary cost and expense. The OWNER shall
maintain records of the actual costs incurred and charged or allocated to the project in accordance with recognized
accounting principles. The OWNER's billing cost to STATE is $802 ,167.00.
It is understood and agreed that the STATE will not pay for any betterment or increase in capacity of OWNER's
facilities in the new location and that OWNER shall give credit to the STATE for the accrued depreciation of the
replaced facilities and for the salvage value of any material or parts salvaged and retained or sold by OWNER.
Not more frequently than once a month, but at least quarterly, OWNER will prepare and submit progress bills for costs
incurred not to exceed OWNER's recorded costs as of the billing date less estimated credits applicable to completed
work. Payment of progress bills not to exceed the amount of this Agreement may be made under the terms of this
Agreement. Payment of progress bills which exceed the amount of this Agreement may be made after receipt and
approval by STATE of documentation supporting the cost increase and after an Amendment to this Agreement has
been executed by the parties to this Agreement.
The OWNER shall submit a final bill to the STATE within 360 days after the completion of the work described in
Section I above. If the STATE has not received a final bill within 360 days after notification of completion of OWNER's
work described in Section I of this Agreement, and STATE has delivered to OWNER fully executed Director's Deeds,
Consents to Common Use or Joint Use Agreements, if required for OWNER's facilities, STATE will provide written
notification to OWNER of its intent to close its file within 30 days and OWNER hereby acknowledges, to the extent
allowed by law, that all remaining costs will be deemed to have been abandoned. If the STATE processes a final bill
for payment more than 360 days after notification of completion of OWNER's work, payment of the late bill may be
subject to allocation and/or approval by the California Transportation Commission.
The final billing shall be in the form of an itemized statement of the total costs charged to the project, less the credits
provided for in this Agreement, and less any amounts covered by progress billings. However, the STATE shall not pay
final bills which exceed the estimated cost of this Agreement without documentation of the reason for the increase of
said cost from the OWNER and approval of documentation by STATE. Except, if the final bill exceeds the OWNER's
estimated costs solely as the result of a Revised Notice to Owner as provided for in Section I, a copy of said Revised
Notice to Owner shall suffice as documentation . In either case, payment of the amount over the estimated cost of this
Agreement may be subject to allocation and/or approval by the California Transportation Commission.
In any event if the final bill exceeds 125% of the estimated cost of this Agreement, an Amended Agreement shall be
executed by the parties to this Agreement prior to the payment of the OWNER'S final bill. Any and all increases in
costs that are the direct result of deviations from the work described in Section I of this Agreement shall have the prior
concurrence of STATE.
Detailed records from which the billing is compiled shall be retained by the OWNER for a period of three years from
the date of the final payment and will be available for aud it by State and/or Federal auditors. In performing work under
this agreement, Owner agrees to comply with the contract cost principles and procedures as set forth in 48 CFR,
Chapter 1, Part 31 , et seq., 23 CFR , Chapter 1, Part 645 and 2CFR, Part 200, et al. If a subsequent State and/or
Federal audit determines payments to be unallowable, OWNER agrees to reimburse STATE upon receipt of STATE
billing. If OWNER is subject to repayment due to failure by State/Local Public Agency (LPA) to comply with applicable
UTILITY AGREEMENT (cont.)
RW 13-5 (REV 12/2016)
Page 3 of 4
I UTILITY AGREEMENT NO. 33 71 8
laws, regulations, and ordinances, then STATE/LPA will ensure that OWNER is compensated for actual cost in
performing work under this agreement.
V. GENERAL CONDITIONS
All costs accrued by OWNER as a result of STATE's request of February 10, 2014 to review, study and/or prepare
relocation plans and estimates for the project associated with this Agreement may be billed pursuant to the terms and
conditions of this Agreement.
If STATE's project which precipitated this Agreement is canceled or modified so as to eliminate the necessity of work by
OWNER, STATE will notify OWNER in writing and STATE reserves the right to terminate this Agreement by Amendment.
The Amendment shall provide mutually acceptable terms and conditions for terminating the Agreement.
All obligations of STATE under the terms of this Agreement are subject to the passage of the annual Budget Act by the
State Legislature and the allocation of those funds by the California Transportation Commission.
OWNER shall submit a Notice of Completion to the STATE within 30 days of the completion of the work described herein .
Where OWNER has prior rights in areas which will be within the highway right of way and where OWNER's
facilities will remain on or be relocated on STATE highway right of way, a Joint Use Agreement or Consent to
Common Use Agreement shall be executed by the parties.
It is understood that said highway is a Federal aid highway and accordingly, 23 CFR, Chapter 1, Part 645 is hereby
incorporated into this Agreement. In addition, the provisions of 23 CFR 635.410, Buy America, are also incorporated into
this agreement. The Buy America requirements are further specified in Moving Ahead for Progress in the 21st Century
(MAP-21 ), section 1518; 23 CFR 635.410 requires that all manufacturing processes have occurred in the United States
for steel and iron products (including the application of coatings) installed on a project receiving funding from the FHWA.
STATE represents and warrants that this Utility Agreement is not subject to 23 CFR 635.410, the Buy America provisions.
UTILITY AGREEMENT (cont.)
RW 13-5 (REV 12/2016)
Page 4 of 4
I UTILITY AGREEMENT NO. 33718
IN WITNESS WHEREOF, the above parties have executed thi s Agreement the day and year above written.
STATE: DEPA
By ~~+-----r-~~--r-------Name
Title
APPROVAL RECOMMENDED:
By S· -sL.,
Name SYNDX\)T:fER
Title Utili ty Coordinator
s-A1tf}
Date
OWN ER: OTAY WATER DISTRI CT
By --------------------------Name
Title
By --------------------------
Name
Title
Date
Date
THIS AGREEMENT SHALL NOT BE EXECUTED BY THE STATE OF CALIFORNIA -DEPARTMENT OF
TRANSPORTATION UNTIL FUNDS ARE CERTIFIED.
DO NOT WRITE BELOW -FOR ACCOUNTING PURPOSES ONLY
PLANN ING AND MANAGEMENT TO COMPLETE UN SHADED FIELDS: UTILITY COMPLETES:
T DOCUMENT SUF CHG PROJECT SPECIAL OBJ DOLLAR
CODE NUMBER FIX DIST UNIT DIST ID PHASE DES IGNAT ION FFY FA CODE AMOUNT
UA
UA
PROJECT ID FUNDING VERIFIED: REV IEW/REQUEST FUNDING:
Sign:> Sign> s~~;; ~~ s:--~\) -\ ~
Print> CARMENCITA COMER Date Print> SYN~ SUTTER Date
R/W Planning and Management Utility Coordinator
THE ESTIM ATED COST TO STATE FOR ITS SHARE OF T HE ABOVE DESCRI BED WORK. IS $3,608,856.00.
CERTIFICATION O F FUNDS
I hereby certify upon my own personal knowledge that budgeted funds are
available for the period and purpose of the expenditure shown here.
Planning and Management
ITEM CHAP STAT I
I
Distributio n: 2 origi nals to R/W Accounting
I original to Util ity Owner
I origi nal to Uti lity File
Date
FY AMOUNT
FUND TYPE PROJECT ID AMOUNT
Design Funds $
Construction Funds 11 00020520 $2,806,689.00
RW Fund s 11 00020520 $ 802,167.00
Vendor/Customer: VC000002091 0
Address 10: ADOO I
STAFF REPORT
TYPE MEETING: Regular Board
MEETING DATE: July 11, 2018
SUBMITTED BY:
Jeff Marchioro
Senior Civil Engineer
Bob Kennedy
Engineering Manager
PROJECT: P2508-001102 DIV. NO.
1-3
& 5
APPROVED BY:
Rod Posada, Chief, Engineering
Mark Watton, General Manager
SUBJECT: Reject Construction Bid for the Pipeline Cathodic Protection
Improvements – Phase II Project
GENERAL MANAGER’S RECOMMENDATION:
That the Otay Water District (District) Board of Directors (Board)
reject a bid for the construction of the Pipeline Cathodic Protection
Improvements – Phase II Project (see Exhibit A for Project location).
COMMITTEE ACTION:
Please see Attachment A.
PURPOSE:
To obtain Board authorization for the General Manager to reject a bid
for the construction of the Pipeline Cathodic Protection Improvements
- Phase II Project (Project) and to rebid the Project.
ANALYSIS:
The District’s Cathodic Protection (CP) Program (Program) was
implemented over a decade ago to provide the long-term benefit of
preserving the life expectancy of metallic pipeline and reservoir
facilities and reducing the risk of costly failures. A portion of
the Program includes annual data collection from roughly 1,000
2
pipeline cathodic test stations. The effort results in a list of
recommendations for 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 of Pipeline CP Improvements 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 for work in vaults immediately adjacent to the Roll
Reservoir.
The work associated with this construction bid for the Project is for
the replacement and repairs of existing cathodic protection systems
on five (5) pipelines in environmentally sensitive areas. This
includes the District's existing 2000 era Interconnect Pipelines
between the Central Area and Otay Mesa, 1998 era pipeline along
Proctor Valley Road, 1987 era pipelines in the Sweetwater River
Bridge at Campo Road, 2004 era pipeline crossing Salt Creek, and 1981
era pipeline crossing the Sweetwater River. Each pipe system
includes several sites which require three (3) agency permits from
Caltrans, City of Chula Vista, and County of San Diego. Overall, the
work includes approximately eleven (11) phases of traffic control and
approximately twenty (20) sites total.
On April 19, 2018, the Project was formally advertised for bid using
BidSync, an online bid solicitation website. The Project was also
advertised in the Daily Transcript and the District’s website.
BidSync provided electronic distribution of the Bid Documents,
including specifications, plans, and addendums. A Pre-Bid Meeting
was held on April 26, 2018, which was attended by a single corrosion
contractor (Corrpro). Three (3) addenda were sent out to all bidders
and plan houses to address questions and clarifications to the
contract documents during the bidding period. The District’s As-
Needed Corrosion Engineer (RFYeager), the District’s As-Needed
Traffic Engineer (Rick Engineering), and District staff jointly
prepared the bid documents.
Specialty corrosion contractors, Corrpro and Farwest, both expressed
interest bidding this Project as prime before and during the bid
phase. Ultimately, Corrpro decided not to bid the Project as prime a
few days before the original bid opening. Consequently, District
staff extended the bid date two (2) weeks to allow more time to
encourage general contractors to submit bids.
Despite District staff’s outreach effort by e-mail to twenty-two (22)
general contractors and phone calls with three (3) specialty
3
corrosion contractors/consultants four to five (4-5) weeks before the
bid opening, only a single bid was received and publicly opened on
May 23, 2018. The table below provides the bid result.
CONTRACTOR TOTAL BID AMOUNT
1 M-Rae Engineering, Inc (Descanso, CA) $347,000.00
The Engineer’s Estimate was $350,000.
Because only one (1) bid was received, staff contacted several
general contractors to inquire as to why they did not bid the
Project. A variety of reasons were given and they are shown in the
table below:
CONTRACTOR REASON
1 Basile Construction
Too busy. Can be selective with bids
because there are more bids to choose
from compared to capacity to bid
projects.
2 Bert W. Salas, Inc. Too busy.
3 Charles King Company Too busy.
4 Fordyce Too busy.
5 Piperin
Attempted to bid Project, but did not
receive corrosion specialty subcontract
bid until too late.
After the bid opening, three (3) specialty corrosion subcontractors
that prepared subcontract bids (Corrpro, Farwest, and California
Corrosion Specialists) all suggested that general contractors may
have found it difficult to dedicate the resources to this bid given
the large number of sites (approximately 20 sites total). Staff
intends to combine this Project with another pipeline project, which
may draw more interest.
Therefore, staff recommends rejecting the bid and rebidding the
project with a larger pipeline project to generate more interest.
FISCAL IMPACT: Joe Beachem, Chief Financial Officer
None.
STRATEGIC GOAL:
This Project supports the District’s Mission statement, “To provide
high value water and wastewater services to the customers of the Otay
Water District, in a professional, effective and efficient manner”
4
and the General Manager’s Vision, "A District that is at the
forefront in innovations to provide water services at affordable
rates, with a reputation for outstanding customer service."
LEGAL IMPACT:
None.
JM/BK:mlc
P:\WORKING\CIP P2508 Cathodic Protection Replacement Program\Staff Reports\BD 07-11-18 Staff Report
Pipeline CP Rehab Phase II reject bids.docx
Attachments: Attachment A – Committee Action
Attachment B – Budget Detail
Exhibit A – Location Map
ATTACHMENT A
SUBJECT/PROJECT:
P2508-001102
Reject Construction Bid for the Pipeline Cathodic
Protection Improvements – Phase II Project
COMMITTEE ACTION:
The Engineering, Operations, and Water Resources Committee
(Committee) reviewed this item at a meeting held on June 25, 2018.
The Committee supported Staff's recommendation.
NOTE:
The “Committee Action” is written in anticipation of the Committee
moving the item forward for Board approval. This report will be sent
to the Board as a Committee approved item, or modified to reflect any
discussion or changes as directed from the Committee prior to
presentation to the full Board.
ATTACHMENT B – Budget Detail
SUBJECT/PROJECT:
P2508-001102
Reject Construction Bid for the Pipeline Cathodic
Protection Improvements – Phase II Project
6/13/2018
Budget
1,250,000
Planning
Consultant Contracts 17,733 17,733 - 17,733 HDR ENGINEERING INC
18,261 18,261 - 18,261 ICF JONES & STOKES INC
Regulatory Agency Fees 50 50 - 50 PETTY CASH CUSTODIAN
1,500 1,500 - 1,500 STATE WATER RESOURCES
Standard Salaries 108,424 108,424 - 108,424
Total Planning 145,968 145,968 - 145,968
Design 001102
Consultant Contracts 14,865 14,865 - 14,865 RFYEAGER ENGINEERING LLC
13,176 13,176 - 13,176 RICK ENGINEERING COMPANY
54,110 54,110 - 54,110 HDR ENGINEERING INC
OTHER AGENCY FEES 749 749 - 749 COUNTY OF SAN DIEGO
Standard Salaries 231,455 231,455 - 231,455
Total Design 314,355 314,355 - 314,355
Construction
Construction Contracts 242,300 242,300 - 242,300 CHARLES KING COMPANY
Consultant Contracts 2,146 2,146 - 2,146 AIRX UTILITY SURVEYORS INC
3,586 3,586 - 3,586 RICK ENGINEERING COMPANY
Infrastructure Equipment & Materials 607 607 - 607 PACIFIC PIPELINE SUPPLY INC
Service Contracts 83 83 - 83 DAILY JOURNAL CORPORATION
Standard Salaries 11,777 11,777 - 11,777
Total Construction 260,499 260,499 - 260,499
Grand Total 720,822 720,822 - 720,822
Vendor/Comments
Otay Water District
p2508-Pipeline Cathodic Protection Repl Prog
Committed Expenditures
Outstanding
Commitment &
Forecast
Projected Final
Cost
OTAY WATER DISTRICT
PIPELINE CATHODIC PROTECTION IMPROVEMENTSPHASE II - LOCATION MAP
EXHIBIT A
CIP P2508F
P:\WORKING\CIP P2508 Cathodic Protection Replacement Program\Graphics\Exhibits-Figures\B&W Staff Report -Exhibit A.mxd
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F
STAFF REPORT
TYPE MEETING: Regular Board
MEETING DATE: July 11, 2018
SUBMITTED BY: Kevin Cameron
Associate Civil Engineer
Bob Kennedy
Engineering Manager
PROJECT: P2610-001103
DIV. NO. 5
APPROVED BY:
Rod Posada, Chief, Engineering
Mark Watton, General Manager
SUBJECT: Reject all Construction Bids for the Valve Replacement Program
– Phase I Project
GENERAL MANAGER’S RECOMMENDATION:
That the Otay Water District (District) Board of Directors (Board)
reject all bids for the construction of the Valve Replacement Program
– Phase I Project (see Exhibit A for Project location).
COMMITTEE ACTION:
Please see Attachment A.
PURPOSE:
To obtain Board authorization for the General Manager to reject all
bids for the construction of the Valve Replacement Program – Phase I
Project (Project).
ANALYSIS:
The District’s distribution system has over 22,000 valves throughout
its service area. Through the Valve Exercise Program, the Operations
staff periodically “exercises” or closes then opens valves to ensure
they are functional and mechanically sound. Valves that are
2
inoperable or do not function properly are logged and scheduled for
repair. In some cases, inoperable valves are in areas that would
require putting a large number of businesses and/or customers out of
service. Performing these repairs with District forces could tie up
the Construction staff for multiple days, and could delay response
time should an emergency occur.
The Valve Replacement Project was created to have contractors perform
the construction that would require extended time to repairs to
problem valves. Phase I was a pilot program to test the shutdown
coordination and the public outreach during the construction. This
would serve as a lessons learned, and the experience would help fine
tune future more larger and extensive valve repair projects. Phase I
consisted of replacing two (2) hydrant valves on Doubletree Road in
Spring Valley.
Staff developed contract documents and the Project was advertised for
bid on May 2, 2018 on the District’s website and several other
publications including the San Diego Daily Transcript. Bidsync also
provided electronic distribution of the bid documents, including
plans, specifications, and addendums. District staff reached out to
eighteen (18) general contractors via e-mail notifying them of the
Project. A Pre-Bid Meeting was held on May 15, 2018, which one
contractor, RGC General Engineering, attended. One (1) 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 24, 2018, with the following
results:
CONTRACTOR TOTAL BID AMOUNT
1 Bunker Construction, Inc., dba Bunker Engineering
Indio, CA $76,000.00
2 Blue Pacific Engineering & Construction
San Dieqo, CA $76,000.00
3 RGC General Engineering, Inc.
Chula Vista, CA $78,788.00
4 Piperin Corporation
Escondido, CA $97,000.00
The Engineer’s Estimate is $29,000.
Two contractors submitted bid amounts that were the same and happened
to be the lowest bid. The low bid amount is 2.5 times higher than
the engineer’s estimate. Staff believes that the Project was too
small to get reasonable interest and pricing, and from outreach done
on other projects, contractors are overwhelmed with their current
workload being done locally. Staff intends to combine this Project
3
with another larger pipeline replacement project, which may draw more
interest and provide the District with better value.
Therefore, staff recommends rejecting all bids, and rebidding the
Project with a future pipeline replacement project.
FISCAL IMPACT: Joe Beachem, Chief Financial Officer
None.
STRATEGIC GOAL:
This Project supports the District’s Mission statement, “To provide
high value water and wastewater services to the customers of the Otay
Water District in a professional, effective, and efficient manner”
and the General Manager’s Vision, “A District that is at the
forefront in innovations to provide water services at affordable
rates, with a reputation for outstanding customer service.”
LEGAL IMPACT:
None.
KC/BK:jf
P:\WORKING\CIP P2610 Valve Replacement Program\Staff Reports\BD 07-11-2018, Staff Report Valve
Replacement Program-Phase I-Reject All Bids.docx
Attachments: Attachment A – Committee Action
Attachment B – Budget Detail
Exhibit A – Project Location Map
ATTACHMENT A
SUBJECT/PROJECT:
P2610-001103
Reject all Construction Bids for the Valve Replacement
Program – Phase I Project
COMMITTEE ACTION:
The Engineering, Operations, and Water Resources Committee
(Committee) reviewed this item at a meeting held on June 25, 2018.
The Committee supported Staff's recommendation.
NOTE:
The “Committee Action” is written in anticipation of the Committee
moving the item forward for Board approval. This report will be sent
to the Board as a Committee approved item, or modified to reflect any
discussion or changes as directed from the Committee prior to
presentation to the full Board.
ATTACHMENT B – Budget Detail
SUBJECT/PROJECT:
P2610-001103
Reject all Construction Bids for the Valve Replacement
Program – Phase I Project
Date Updated: 6/14/18
Budget
275,000
Planning
Standard Salaries 4,596 4,596 - 4,596
Regulatory Agency Fees 50 50 - 50 PETTY CASH CUSTODIAN
Total Planning 4,646 4,646 - 4,596
Design
Standard Salaries 12,535 12,535 - 12,535
Equipment Charges 5 5 - 5 EQUIPMENT CHARGES
Total Design 12,540 12,540 - 12,540
Construction
Standard Salaries 872 872 - 872
Service Contracts 86 86 - 86 DAILY JOURNAL CORP
Equipment Charges 5 5 - 5 EQUIPMENT CHARGE
Total Construction 963 963 - 963
Grand Total 18,149 18,149 - 18,149
Vendor/Comments
Otay Water District
P2610 - Valve Replacement Program - Phase 1
Committed Expenditures
Outstanding
Commitment &
Forecast
Projected Final
Cost
OTAY WATER DISTRICT
PHASE 1EXHIBIT AP:\WORKING\CIP P2610 Valve Replacement Program\Graphics\Exhibits-Figures\(Portrait Layout)Valve Replacement.mxd
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STAFF REPORT
TYPE MEETING: Regular Board MEETING DATE: July 11, 2018
SUBMITTED BY: Kevin Cameron
Associate Civil Engineer
Bob Kennedy
Engineering Manager
CIP./G.F. NO: P1210-
010000
DIV. NO. ALL
APPROVED BY:
Rod Posada, Chief, Engineering
Mark Watton, General Manager
SUBJECT: Informational Item - Status of the current agreement with the
City of San Diego, the current cost of recycled water, and
alternative supply studies
GENERAL MANAGER’S RECOMMENDATION:
No recommendation. This is an informational item only.
COMMITTEE ACTION:
Please see Attachment A.
PURPOSE:
To update the Otay Water District (District) Board of Directors
(Board) on the status of the current agreement with the City of
San Diego (City), the current cost of recycled water at the
RWCRWF and from the City, and alternative supply studies.
ANALYSIS:
AGREEMENT WITH THE CITY OF SAN DIEGO
On October 20, 2003, the District and the City entered into an
agreement for the purchase of recycled water (Agreement) from
the South Bay Water Reclamation Plant (SBWRP). In 2007, the
District began taking water from SBWRP. Under the terms of this
Agreement, a minimum annual contract amount must be purchased
(take-or-pay). This Agreement expires on January 1, 2027,
unless a new agreement is negotiated with the City.
2
The District operates one of the largest recycled water
distribution systems in San Diego County and will supply
approximately 3,660 acre-feet of recycled water to 719 customers
in Fiscal Year 2018. The District’s Ralph W. Chapman Water
Recycling Facility (RWCWRF) produces on average 1,000 acre-feet
per year (AFY) of recycled water with the balance purchased from
the City’s SBWRP. The District will be required to pay for
5,029 AFY even though the District expects to take only 2,660
AFY from the SBWRP. The District is the single largest user of
recycled water buying about 99% of the recycled water the City
has available for sale from the SBWRP.
RWCWRF AND THE CURRENT COST OF RECYCLED WATER
On April 4, 2018, staff from the District’s Finance Department
presented to the Board an analysis of sewer and recycled water
cost on Fiscal Year 2016’s actual cost, to determine the cost
benefit of whether the District should keep the RWCWRF plant
open (status quo) or to shut down the plant and send 100% of the
flow through the County to Metro for treatment. Based on this
analysis, the cost of recycled water produced at the District’s
RWCWRF is $982.47 per AF. The cost to purchase recycled water
from the SBWRP at the current rate is $756 per AF, but when the
meter fee and the take-or-pay contractual amount is included,
the effective rate is $1,396.87 per AF.
The April 4, 2018 analysis also reveals that for sewer customers
it is far more cost effective to treat sewage at the RWCWRF as
the savings is $592,284. For recycled customers it is almost
cost neutral due to the fixed nature of the contract to purchase
water from the City of San Diego. It should be noted that this
is a snapshot of the current status and does not consider future
events.
In summary, the analysis showed that it is cost effective to
have the RWCWRF running at full capacity as opposed to shutting
down the treatment plant and sending flows to San Diego
Metropolitan Wastewater (Metro) system.
ALTERNATIVE SUPPLY STUDIES
The 2018-2022 Strategic Plan will consider various aspects of
the future of sewer and recycled water on a short-term and long-
term basis. The analysis presented in this staff report is
short-term and does not consider future events, such as what the
cost of the City’s Pure Water will do to the Metro costs or how
Metro may propose changes to their rate structure.
3
Some options that will be considered in the strategic plan are
to perform an analysis to have the RWCWRF plant only treat
sewage on a seasonal basis, or have the County of San Diego take
over the collection system and lease out the plant.
Additionally, the strategic plan will look at the future of
recycled water such as receiving supply from the International
Boundary and Water Commission (IBWC) should the City not renew
the contract for recycled water at SBWRP. A variation of the
study could have additional wastewater diverted to the SBWRP
from IBWC’s facility to supplement flows to meet 100% of the
District’s summer peak day demands.
FISCAL IMPACT: Joe Beachem, Chief Financial Officer
No fiscal impact as this is an informational item only.
STRATEGIC GOAL:
This Project supports the District’s Mission statement, “To
provide high value water and wastewater services to the
customers of the Otay Water District in a professional,
effective, and efficient manner” and the General Manager’s
Vision, “A District that is at the forefront in innovations to
provide water services at affordable rates, with a reputation
for outstanding customer service.”
LEGAL IMPACT:
None.
KC/BK:jf
P:\WORKING\As Needed Services\Alternative Recycled Water Source\Staff Report\07-11-18 Staff
Report Recycled Water Alternatives Info Item-Working (KC-BK).doc
Attachment: Attachment A – Committee Action
ATTACHMENT A
SUBJECT/PROJECT:
P1210-000000
Informational Item - Status of the current agreement
with the City, the current cost of recycled water from
the City, and alternative supply studies
COMMITTEE ACTION:
The Engineering, Operations, and Water Resources Committee
(Committee) reviewed this item at a meeting held on June 25,
2018. The Committee supported Staff's recommendation.
NOTE:
The “Committee Action” is written in anticipation of the
Committee moving the item forward for Board approval. This
report will be sent to the Board as a Committee approved item,
or modified to reflect any discussion or changes as directed
from the Committee prior to presentation to the full Board.