HomeMy WebLinkAboutAgenda Packet - EVWD Board of Directors - 09/19/2018SPECIAL BOARD MEETING
September 19, 2018 at 5:30 PM
31111 Greenspot Road
Highland, CA 92346
AGENDA
CALL TO ORDER
PLEDGE OF ALLEGIANCE
ROLL CALL OF BOARD MEMBERS
PUBLIC COMMENTS
Any person wishing to speak to the Board of Directors is asked to complete a Speaker
Card and submit it to the District Clerk prior to the start of the meeting. Each speaker is
limited to three (3) minutes, unless waived by the Chairman of the Board. Under the State
of California Brown Act, the Board of Directors is prohibited from discussing or taking
action on any item not listed on the posted agenda. The matter will automatically be
referred to staff for an appropriate response or action and may appear on the agenda at a
future meeting.
DISCUSSION AND POSSIBLE ACTION ITEMS
1. Consider Approval of Sterling Natural Resource Center - Design/Build
Guaranteed Maximum Price
2. Consider Adoption of Resolution 2018.15 - Replacing Reimbursement
Resolution 2016.03
REPORTS
3. General Manager/CEO
4. Legal Counsel Report
5. Board of Directors' Comments
ADJOURN
Pursuant to Government Code Section 54954.2(a), any request for a disability-related modification or
accommodation, including auxiliary aids or services, that is sought in order to participate in the above
agendized public meeting should be directed to the District Clerk at (909) 885-4900.
SPECIAL BOARD AGENDA STAFF REPORT
Agenda Item #1.
Meeting Date: September 19, 2018
Discussion Item
To: Governing Board Members
From: General Manager/CEO
Subject: Consider Approval of Sterling Natural Resource Center - Design/Build Guaranteed Maximum
Price
RECOMMENDATION:
Staff recommends that the Board of Directors approve the Guaranteed Maximum Price (GMP) of $147.5
million for the design and construction of the Sterling Natural Resource Center and authorize the General
Manager/CEO to enter into a Design-Build agreement with the Balfour Beatty / Arcadis Team.
BACKGROUND / ANALYSIS:
Once constructed, the Sterling Natural Resource Center (SNRC) will be a state-of-the-art wastewater treatment
facility that creates recycled water for groundwater replenishment. This project is an opportunity to not only
maximize a local resource, but to enhance our connection with the community through public space and
partnerships.
Given the complexities of this facility, the Governing Board has authorized the use of Progressive Design-Build
as the procurement method. This process maximizes the involvement of the construction team early in the
process, maximizing cooperation and fostering value added discussions; as compared to the traditional Design-
Bid-Build method which historically results in projects delays and cost overruns.
Since the Design-Build Partnership selection in July 2018, District staff has been working with the Balfour
Beatty / Arcadis Team to further clarify the design and permitting needs to establish a Guaranteed Maximum
Price or GMP for the project. Through cooperative meetings, the team continues to solidify specific details
regarding the treatment process, permitting, and additional community benefits to build a clear vision of the
completed effort based on the current environment.
Based on the collaborative meetings, staff is recommending that the Governing Board approve a Guaranteed
Maximum Price of $147.5 million, in addition to the $2.5 million previously authorized. This project will be
funded through a variety of sources including:
$18 million from the San Bernardino Valley Municipal Water District for the regional recycled
water conveyance pipeline
$6.7 million from Proposition 1 Water Bond and Clean Water State Revolving Fund Grants
$125.3 million from Proposition 1 Water Bond and Clean Water State Revolving Fund Low-Interest
Loans
Recommended by:
John Mura
General Manager/CEO
Respectfully submitted:
Jeff Noelte
Director of Engineering & Operations
G iven the regional benefits the SNRC will provide, it has been identified as a partnership opportunity with San
Bernard ino Valley Munic ipal Water District’s regional recyc led water effort. This will result in a reimbursement
agreement of $18 million for the construction of a pipeline which will be designed and constructed to convey not
only recyc led water from the SNRC but p lanned recyc led water projects that have been identified to provide for
groundwater replenishment. The balance of the pro ject, $132 will be funded through a combination of 1.8% low-
interest loans and grants from the Proposition 1 Water Bond and C lean Water State Revolving Funds. Due to
the extens ive community and regional benefits of this project, over $25 million in outs ide funding sources has
been secured. Ultimately, this results in the fiscal impact to East Valley Water District ratepayers to be $125.3
million. Staff continues to pursue add itional grant programs that would further reduce the d irect costs to the
community.
The Guaranteed Maximum Price has been developed with the expectations estab lished to enhance water
resource reliability, allow for East Valley Water District to provide in-house wastewater treatment services, and
offer an added community resource and education center.
Should the Board approve this item, staff will submit this contract to the State Water Resources Contro l Board
for final loan approval. Staff expects this process to be comp leted within s ix weeks which will enab le
construction to commence in November 2018.
AGENCY GOALS AND OBJECTIVES:
Goal and Ob jectives I - Imp lement Effective Solutions Through Visionary Leadership
a) Identify Opportunities to Optimize Natural Resources
Goal and Objectives II - Maintain a Commitment to Sustainab ility, Transparency, and Accountab ility
c) Pursue Alternative Fund ing Sources
Goal and Objectives IV - Promote Planning, Maintenance and Preservation of District Resources
a) Develop Pro jects and Programs to Ensure Safe and Reliab le Services
REVIEW BY OTHERS:
This agenda item has been reviewed by the Executive Management Team.
FISCAL IMPACT
This pro ject is approved in the FY 2018-19 Capital Improvement Program in the amount of $15 million.
S P E CIAL B O AR D AG E ND A S TAF F R E P O RT
Agenda Item #2.
Meeting Date: S eptemb er 19, 2018
Dis c ussion Item
To: G o verning Board Memb ers
F rom: G eneral Manager/C EO
Subject: C ons id er Adoptio n of R es o lution 2018.15 - R eplac ing R eimb urs ement R es olutio n 2016.03
R E C O MME N D AT IO N:
S taff is rec o mmending that the Bo ard of Direc tors (Board ) adopt R es o lutio n 2018.15.
B AC KGR O UN D / AN ALYS IS :
O n March 23, 2016 the Board o f Directo rs adopted R eimbursement R es o lution 2016.03 dec laring the Dis tric t’s
intentio n to reimburs e its elf with tax exempt financing b o rro wed from the S tate Water R es ourc es C ontrol Board
(S W R C B). T he s tated amo unt of anticipated b o rro wing was $126 million.
S inc e that date, the Dis tric t has achieved many s ignificant changes to the circ ums tances s urround ing the S terling
Natural R esourc e C enter (S NR C ) projec t, includ ing 1) settling the laws uit with the C ity o f S an Bernardino, 2)
o b taining wastewater treatment authority from L A F C O , and 3) d issolving the F ramewo rk Agreement with the
S an Bernard ino Valley Municipal Water Dis trict (S BVMW D) allo wing auto nomy in cons tructio n o f the p ro jec t,
inc luding us e o f the Design-Build p ro c es s . In additio n, c urrent ec o nomic c o nditions have res ulted in increas es to
cons truc tion c o s ts , inc luding lab or and materials .
It is standard p roc ed ure fo r agenc ies to re-evaluate projec t cos ts prior to the s tart of cons truc tion and s ubmit for
a final fund ing ad jus tment. S taff has maintain o pen lines o f communicatio n with S W R C B s taff regard ing the
p ro ces s fo r reques ting additio nal fund s to reflec t current market cond itions. T his s tep requires that the
G overning Bo ard take ac tion to rep lace the o riginal res o lutio n with an up d ated vers io n reflec ting the ap p ro ved
G uaranteed Maximum P ric e.
Attached R eimbursement R es o lution 2018.15 revis es the to tal fund ing reques t fro m the S W R C B from $126
millio n to $132 million to reflec t the G uaranteed Maximum P rice of the S terling Natural R es o urc e C enter
p ro p o s ed b y Balfo ur Beatty / Arcadis Team. T he language o f the R esolution has also b een revis ed to o mit
referenc es to the F ramework Agreement with S BVMW D.
AG E N C Y G O ALS AN D OB J E C T IVE S :
R ecommended b y:
Jo hn Mura
G eneral Manager/C EO
R espec tfully sub mitted:
Brian Tomp kins
C hief F inancial O ffic er
AG E N C Y G O ALS AN D OB J E C T IVE S :
G o al and O bjec tives I I - Maintain a C ommitment to S us tainab ility, Transparenc y, and Ac c o untability
a) P rac tice Trans parent and Ac countab le F is cal Management
c) P urs ue Alternative F unding S ources
R E VIE W B Y O T HE R S :
T his agenda item has been reviewed by the Ad minis tratio n Dep artment and Legal C o uns el.
F IS C AL IMPAC T
T he amo unt o f funding reques ted fro m the S tate Water R esources C o ntro l Board has inc reas ed by $6 millio n,
ho wever s inc e the adoptio n o f R es o lutio n 2016.03, the Dis tric t has rec eived a grant award of $6.7 millio n.
ATTACH M E N TS:
Description Type
Resolution 2018.15 Resolutio n Letter
Red-lined Resolutio n 2016.03 to Resolutio n 2018.15 Backup Material
East Valley Water District
Resolution 2018.15
Page 1 of 3
RESOLUTION NO. 2018.15
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE EAST VALLEY WATER
DISTRICT REVISING RESOLUTION 2016.03 WHEREBY THE DISTRICT
DECLARED ITS INTENTION TO REIMBURSE EXPENDITURES PAID PRIOR TO
THE APPROVAL BY THE STATE WATER RESOURCES CONTROL BOARD OF A
CLEAN WATER STATE REVOLVING FUND AND/OR WATER RECYCLING FUND
FINANCIAL ASSISTANCE APPLICATION
WHEREAS, East Valley Water District (the “District”) desires to finance the costs of
certain Groundwater Replenishment Facilities (Project); and
WHEREAS, the Project contemplates the design and construction of public facilities in
the form of a wastewater treatment plant and associated and necessary pipelines and infrastructure
(the “Project”), which will treat wastewater generated within the District’s service area. The
Project will produce recycled water for groundwater recharge and other beneficial uses, which will
benefit the San Bernardino Basin Area, which is consistent with the policies established by the
State Water Resources Control Board Recycled Water Policy adopted in 2009, as well as article
X, section 2 of the California Constitution and Water Code section 13576(k). The Project will be
known as the Sterling Natural Resource Center; and
WHEREAS, the Environmental Impact Report for the Project was certified and CEQA
Findings of Fact, a Statement of Overriding Considerations and a Mitigation Monitoring and
Reporting Program for the project were adopted by the District on March 23, 2016; and
WHEREAS, the District desires and intends to finance the construction and/or
reconstruction of the Project or portions of the Project with moneys ("Project Funds") provided by
the State of California, acting by and through the State Water Resources Control Board (State
Water Board); and
WHEREAS, the State Water Board may fund the Project Funds with proceeds from the
sale of obligations the interest upon which is excluded from gross income for federal income tax
purposes (the "Obligations"), and
WHEREAS, prior to the approval by the State Water Board of the Project Funds, the
District has incurred certain capital expenditures (the "Expenditures") with respect to the Project
from available moneys of the District for which the District will seek reimbursement; and
WHEREAS, the District has determined that those moneys advanced prior to and after the
date hereof to pay the Expenditures are available only for a temporary period and it is necessary
to reimburse the District for the Expenditures from the proceeds of the Obligations.
East Valley Water District
Resolution 2018.15
Page 2 of 3
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of East Valley
Water District as follows:
Section 1. The District hereby states its intention and reasonably expects to reimburse
Expenditures paid prior to the issuance of the Obligations or the approval by the State Water Board
of the Project Funds.
Section 2. The reasonably expected maximum amount of the Project Construction Funds
is $132,000,000, and the reasonably expected maximum principal amount of borrowed Project
Construction Funds is $126,000,000.
Section 3. Each District expenditure will be of a type properly chargeable to a capital
account under general federal income tax principles.
Section 4. This resolution is adopted as official intent of the District in order to comply
with Treasury Regulation §1.150-2 and any other regulations of the Internal Revenue Service
relating to the qualification for reimbursement of Project costs.
Section 5. All the recitals in this Resolution are true and correct and this District so finds,
determines and represents.
ADOPTED this 19th day of September 2018.
ROLL CALL:
Ayes:
Noes:
Absent:
Abstain:
___________________________________
Chris Carillo
Board President
East Valley Water District
Resolution 2018.15
Page 3 of 3
September 19, 2018
I HEREBY CERTIFY that the foregoing is a full, true and correct copy of Resolution 2018.15
adopted by the Board of Directors of East Valley Water District at its Special Meeting held
September 19, 2018.
ATTEST:
_____________________________________
John Mura
Board Secretary–
East Valley Water District
Resolution 2016.03
Page 1 of 3
RESOLUTION NO. 2018.15
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE EAST VALLEY WATER
DISTRICT REVISING RESOLUTION 2016.03 WHEREBY THE DISTRICT
DECLARED DECLARING ITS INTENTION TO REIMBURSE EXPENDITURES PAID
PRIOR TO THE APPROVAL BY THE STATE WATER RESOURCES CONTROL
BOARD OF A CLEAN WATER STATE REVOLVING FUND AND/OR WATER
RECYCLING FUND FINANCIAL ASSISTANCE APPLICATION
WHEREAS, East Valley Water District (the “District”) desires to finance the costs of
certainhas entered into an agreement entitled Framework Agreement for the Construction and
Operation of Potential Groundwater Replenishment Facilities (Project)By and Between East
Valley Water District and San Bernardino Valley Municipal Water District (“Agreement”) which
is effective as of October 6, 2015; and
WHEREAS, the Agreement Project contemplates the design and construction of public
facilities in the form of a wastewater treatment plant and associated and necessary pipelines and
infrastructure (the “Project”), which will treat wastewater generated within the District’s service
area. The Project will produce recycled water for groundwater recharge and other beneficial uses,
which will benefit the San Bernardino Basin Area, which is consistent with the policies established
by the State Water Resources Control Board Recycled Water Policy adopted in 2009, as well as
article X, section 2 of the California Constitution and Water Code section 13576(k). The Project
will be known as the Sterling Natural Resource Center; and
WHEREAS, pursuant to the Agreement, the District is to finance all work associated with
or required by the Project and may make any arrangement that it deems appropriate for such
financing without the consent of San Bernardino Valley Municipal Water District which will
construct and operate the Project; and
WHEREAS, the Environmental Impact Report for the Project was certified and CEQA
Findings of Fact, a Statement of Overriding Considerations and a Mitigation Monitoring and
Reporting Program for the project were adopted by the lead agency, San Bernardino Valley
Municipal Water District on March 15, 2016, and were considered and adopted by the District as
a responsible agency on March 23, 2016; and
WHEREAS, the District desires and intends to finance the construction and/or
reconstruction of the Project or portions of the Project with moneys ("Project Funds") provided by
the State of California, acting by and through the State Water Resources Control Board (State
Water Board); and
WHEREAS, the State Water Board may fund the Project Funds with proceeds from the
sale of obligations the interest upon which is excluded from gross income for federal income tax
purposes (the "Obligations"), and
East Valley Water District
Resolution 2016.03
Page 2 of 3
WHEREAS, prior to either the issuance of the Obligations or the approval by the State
Water Board of the Project Funds, the District has incurred and will continue to incur certain
capital expenditures (the "Expenditures") with respect to the Project from available moneys of the
District for which the District will seek reimbursement; and
WHEREAS, the District has determined that those moneys advanced prior to and after the
date hereof to pay the Expenditures are available only for a temporary period and it is necessary
to reimburse the District for the Expenditures from the proceeds of the Obligations.
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of East Valley
Water District as follows:
1. The District hereby states its intention and reasonably expects to reimburse
Expenditures paid prior to the issuance of the Obligations or the approval by the State Water Board
of the Project Funds.
2. The reasonably expected maximum principal amount of the Project Construction
Funds is $132,000,000, and the reasonably expected maximum principal amount of borrowed
Project Costruction Funds is $126,000,000.
3. This resolution is being adopted no later than 60 days after the date on which the
District will expend moneys for the construction portion of the Project costs to be reimbursed with
Project Funds.
4. Each District expenditure will be of a type properly chargeable to a capital account
under general federal income tax principles.
5. To the best of our knowledge, this District is not aware of the previous adoption of
official intents by the District that have been made as a matter of course for the purpose of
reimbursing expenditures and for which tax-exempt obligations have not been issued.
6. This resolution is adopted as official intent of the District in order to comply with
Treasury Regulation §1.150-2 and any other regulations of the Internal Revenue Service relating
to the qualification for reimbursement of Project costs.
7. All the recitals in this Resolution are true and correct and this District so finds,
determines and represents.
PASSED, APPROVED and ADOPTED this 23rd 19th day of MarchSeptember,
20162018.
ROLL CALL:
Ayes:
Noes:
Absent:
East Valley Water District
Resolution 2016.03
Page 3 of 3
Abstain:
___________________________________
Ronald L. CoatsChris Carillo
Board President
I HEREBY CERTIFY that the foregoing is a full, true and correct copy of Resolution
20162018.03 15 adopted by the Board of Directors of East Valley Water District at its Regular
Special Meeting held March 23, 2016.
September 19th, 2018.
_____________________________________
John J. Mura
Secretary, Board of Directors