HomeMy WebLinkAbout2002-02-12; Municipal Water District; 518; Carlsbad Water Recycling FacilityCARLSBAD MUNICIPAL WATER DISTRICT -AGENDA BILL
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AUTHORIZATION TO ADVERTISE FOR BIDS FOR
ITG. 211 2/02 CITY ATTY. CARLSBAD WATER RECYCLING FACILITY
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EPT. ENG PROJECT NO. 3675-2
RECOMMENDED ACTION:
Adopt Resolution No. I 37 approving plans and specifications and authorizing the
City Clerk to advertise for bids for the construction of the Carlsbad Water Recycling Facility,
Project No. 3675-2.
ITEM EXPLANATION:
The Carlsbad Water Recycling Facility (CWRF) is a 4.0 million gallon per day advanced tertiary
treatment facility. It is located along Avenida Encinas adjacent to the south boundary of the
Encina Water Pollution Control Facility. The CWRF is an integral part of the Encina Basin Water
have been approved for advertising by the State Water Resources Control Board (SWRCB),
Reclamation Program, Phase II project (Phase 11). The plans and specifications for the CWRF
which is providing a low-interest loan and grant for the Phase II project.
ENVIRONMENTAL REVIEW:
A Mitigated Negative Declaration was prepared for the Phase II project. This was approved by
the City Council on January 25, 2000 under Case No. EIA 99-09, Coastal Development Permit
No. 99-45 and Conditional Use Permit No. 9923 was approved for the Carlsbad Water Recycling Facility on August 22, 2001 by the Planning Commission.
FISCAL IMPACT:
The total cost for the Phase II project (not including the land cost) is $38.6 million. The property
for the CWRF was previously purchased from the Encina Wastewater Authority in the amount of
$1.5 million using Sewer Replacement Funds. The land will be leased from the Sewer
Replacement Fund, and represents an additional cost to the project. Total Phase II project cost
is shown in the Table below.
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The project is being financed through a combination of local, State, and Federal funding
programs. These programs include the following:
Local Funding - Under previous resolutions, the Board appropriated $4.6 million from the Water
Capital Replacement Fund for the Phase II project. These appropriations are intended to fund the
are not be eligible under the SWRCB grant or loan programs.
cost of items such as right-of-way and engineering and construction management expenses which
approved a $31 million low-interest loan and $5 million grant. The interest rate on the loan is SWRCB Loan and Grant - On January 23, 2002, the State Water Resources Control Board
based on one-half of the State’s general obligation bond rate, and is expected to be approximately
2.5% annually. It will be repaid from revenues generated by the sales of recycled water to
irrigation customers.
Between the local funding and the State funding, there is a total of $40.6 million available which is
sufficient to fund the construction of the Phase II project.
Federal Funding - The Phase II project has also authorized to receive a 25 percent project grant from the Federal Bureau of Reclamation (BUREC) in 1997. The BUREC is completing the National Environmental Policy Act (NEPA) documentation, which will allow the BUREC to enter
the Phase II project. It is estimated that CMWD may receive $2 million in grant funding this current into an agreement with the CMWD to receive annual appropriations as approved by Congress for
fiscal year, and additional grant funds in subsequent fiscal years. The total maximum amount of funding from the BUREC could amount to $9 million. The SWRCB grant and the BUREC grant can be combined on the Phase II project, which would total approximately $14 million. If the BUREC grant is received, it will allow the CMWD to repay the SWRCB loan earlier; thereby, reducing the ongoing costs of the project.
The Phase II project was also appropriated approximately $2.2 million from the Environmental
Protection Agency (EPA). The EPA is waiting for the NEPA process to be completed by the
BUREC before proceeding with formal approval of the grant. The EPA grant and the BUREC grant cannot be combined, however.
ODerations
A cash flow analysis was prepared to provide an estimate of future revenues and operating expenses for the recycled water program. One of the revenue sources for the project will be rebates from the Metropolitan Water District (MWD) and the San Diego County Water Authority (SDCWA). On March 25, 2000, the CMWD entered into an agreement with the MWD to receive a $210 per acre-foot rebate that applies to every acre-foot of recycled water sold. Over the life of the agreement, it is estimated that the rebate could generate up to $13.5 million to offset the operating
costs of the recycled water program. The CMWD is eligible to receive this rebate until 2019. The
CMWD has also applied for a $100 per acre-foot rebate over a time period of 25 years from the
the Water Authority’s Reclamation Advisory Committee (WARAC) on February 25, 2002. If San Diego County Water Authority (SDCWA). The agreement for this rebate is scheduled to go to
approved by WARAC, it would then proceed to the SDCWA Board for consideration of approval at
their meeting in March 2002.
The results of the cash flow analysis show that, in today’s dollars, future revenues are estimated at about $5 million per year and expenses at approximately $5.8 million per year. These numbers
do not include any allowance for future replacement costs. There are several factors, which were not considered in the cash flow analysis due to their uncertain nature. The Federal BUREC grant was not included in the funding analysis. If this grant is received, the loan amount would be reduced, and future annual debt service payments would decrease by up to $500,000 per year. In addition, the demand for recycled water could increase; the Carlsbad Municipal Golf Course
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Page 3 of Agenda Bill No. 5-1
alone, if constructed, would add an additional $260,000 in revenues. Also, the bonds will be
repaid in 20 years, reducing annual expenses by almost $2 million. The analysis assumed that
the recycled water rate would be held constant.through 2006; however, the rate as presently
adopted is established at 95 percent of the potable water rate. Finally, unknown economic factors
such as the cost of power could also affect the operating cost of the program.
EXHIBITS:
1. Location Map.
2. Resolution No. \ \ 301 approving plans and specifications and authorizing the
City Clerk to advertise for bids for the construction of the Carlsbad Water Recycling Facility,
Project No. 3675-2.
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RESOLUTION NO. 1139
A RESOLUTION OF THE BOARD OF DIRECTORS OF CARLSBAD MUNICIPAL WATER DISTRICT (CMWD) APPROVING PLANS AND
ADVERTISE FOR BIDS FOR THE CONSTRUCTION OF THE SPECIFICATIONS AND AUTHORIZING THE CITY CLERK TO
CARLSBAD WATER RECYCLING FACILITY, PROJECT NO. 3675-2.
WHEREAS, the Board of Directors of 'the Carlsbad Municipal Water District has
letermined it necessary, desirable, and in the public interest to construct the Carlsbad Water
tecycling Facility; and
WHEREAS, the plans and specifications for the construction of the Carlsbad Water
tecycling Facility have been prepared, are o~n file in the Engineering Department of the City of
:arkbad and are incorporated by reference herein; and
WHEREAS, the Carlsbad Water Recycling Facility is part of the Encina Basin Water
leclamation Piogram. Phase II Project (Phase II) with an estimated project cost of $36 million
IUS right-of-way cost and onsite retrofit expense; and
WHEREAS, said project was approved for a low-interest loan in the amount of $31 million
nd a grant in the amount of $5 million by the State Water Resources Control Board on January
,3,2002; and
WHEREAS, funding in the amount of $12.5 million shall be appropriated from the
Vater Capital Replacement Fund with the understanding that the CMWD will receive a
)w-interest loan and a grant which will be used to reimburse the Water Capital Replacement
'und as progress payments are submitted to the State Water Resources Control Board during
onstruction of the Carlsbad Water Recycling Facility.
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of Carlsbad Municipal
Vater District (CMWD) of the City of Carlsbad, California, as follows:
1. That the above recitations are true and correct.
2. That the plans, specifications, and contract documents on file in the oftice of the
:ity Clerk are hereby approved.
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3. That the Secretary of the Carlsbad Municipal Water District is hereby authorized
and directed to publish, in accordance with State law, a Notice to Contractors Inviting Bids for the
:onstruction of the Carlsbad Water Recycling Facility, Project No. 3675-2, in accordance with the
ians, specifications, and contract documents referred to herein.
4. That $12.5 million shall be appropriated from the Water Capital Replacement Fund
or the Carlsbad Water Recycling Facility.
PASSED, APPROVED AND ADOPTED at a special meeting of the Carlsbad Municipal
Nater District held on the -day of FEBRUARY , 2002 by the following vote, to wit:
AYES: Board Members Lewis, Kulchin, Finnila, Hall
NOES: None
ABSENT: Board Membe,r Nygaard
ATTEST:
(SEAL) L TANICE bREITENFELD, Deputy Sec'retary
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