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HomeMy WebLinkAbout05/20/2004 AGENDA BACKUPCentral Contra Costa Sank..ry District ' BOARD OF DIRECTORS POSITION PAPER Board Meeting Date: May 20, 2004 No.: 3.a. H EAR I NGS Type of Action: CONDUCT A PUBLIC HEARING, APPROVE CIB /CIP Subject: CONDUCT A PUBLIC HEARING ON THE DRAFT CAPITAL IMPROVEMENT BUDGET (CIB) FOR 2004 -05 AND THE DRAFT 2004 TEN -YEAR CAPITAL IMPROVEMENT PLAN (CIP), APPROVE THE 2004 CIP, AND APPROVE THE CIB FOR INCLUSION IN THE 2004 -05 DISTRICT BUDGET Submitted By: Initiating Dept./Div.: John Mercurio, Management Analyst Engineering /Environmental Services REVIEWED AND RECOMMENDED FOR BOARD ACTT : 4tl M urio R. S idt C. Swanson A. Farrell arles W. Batts / General Manag r ISSUE: The Board of Directors has established May 20, 2004, as the date for a public hearing on the draft CIB for 2004 -05 and the 2004 Ten -Year CIP. Separate Board approval of the CIP and the CIB for inclusion in the 2004 -05 District Budget is requested. RECOMMENDATION: Conduct a public hearing to receive comments on the CIB /CIP. Approve the draft 2004 CIP. Approve the draft CIB for inclusion in the 2004 -05 District Budget. FINANCIAL IMPACTS: Approval of the draft FY 2004 -05 CIB and 2004 CIP is a necessary step prior to Board adoption. Approval will include an additional authorization of $20,754,000 from the Sewer Construction Fund, resulting in a total Fiscal Year 2004 -05 Board authorized funding level of $41,976,000. This will allow expenditures to continue on the District's Capital Improvement Program. ALTERNATIVES /CONSIDERATIONS: Not applicable. BACKGROUND: The CIP provides the basis for project prioritizing and scheduling, staffing, and long -range financial planning. The CIP also provides the framework for analyzing different capital program funding scenarios. The draft 2004 CIP covers the ten -year period from 2004 -05 through 2013 -14. The draft plan includes expenditures totaling $239.1 million (2004 dollars) over ten years. U: \Position Papers \Mercurio \CIP -CIB Hearing (04).doc Page 1 of 4 POSITION PAPER Board Meeting Date: May 20, 2004 subject: CONDUCT A PUBLIC HEARING ON THE DRAFT CAPITAL IMPROVEMENT BUDGET (CIB) FOR 2004 -05 AND THE DRAFT 2004 TEN -YEAR CAPITAL IMPROVEMENT PLAN (CIP), APPROVE THE 2004 CIP, AND APPROVE THE CIB FOR INCLUSION IN THE 2004 -05 DISTRICT BUDGET The CIB provides a detailed presentation of the schedules and cost estimates for projects proposed for the first year of the ten -year planning period. It also provides for the Board's authorization of funds for 2004 -05 from the Sewer Construction Fund to the Treatment Plant, Collection System, General Improvements and Recycled Water Programs. A review draft CIB /CIP was submitted to the Board of Directors on April 15, 2004. A Board Workshop to discuss the review draft was held on April 22, 2004. It is appropriate for the Board to receive comments from the public prior to considering approval of the CIB /CIP. May 20, 2004 was established by the Board as the date for a public hearing to receive these comments, and appropriate notices have been posted and published. Capital Budget Authorization Adoption of the CIB with the 2004 -05 District Budget will authorize additional funds from the Sewer Construction Fund for planning, design, and construction of capital improvement projects. The new funding authorization will include a carry-over of approximately $21,222,000 from Board authorizations in previous years, and additional authorization of $20,754,000 from the Sewer Construction Fund resulting in a total Fiscal Year 2004 -05 authorized funding level of $41,976,000. Specific Board approval is required for consultant agreements over $50,000, for award of construction contracts over $15,000, and for project overruns in excess of 15 percent (15 %) of the final project budget established at the time of construction contract award. The distribution of the funding authorization to the four capital improvement programs is shown on Attachment 1. The estimated expenditures for the capital program in FY 2004 -05 are also shown in Attachment 1 and total $28,096,000. Ten -Year Capital Plan The draft 2004 CIP includes $60.1 million (2004 dollars) for Treatment Plant projects (25% of total expenditures), $155.1 million for Collection System projects (65% of total expenditures), $19.2 million for General Improvements projects (8% of total expenditures), and $4.6 million for Recycled Water projects (2% of total expenditures) over the next ten years. The expenditures recommended in the five -year Master Plan for Information Technology have been incorporated in the General Improvements Program in the draft 2004 CIP. LIAPosition Papers \Mercurio \CIP -CIB Hearing (04).doc Page 2 of 4 POSITION PAPER Board Meeting Date: May 20, 2004 subject: CONDUCT A PUBLIC HEARING ON THE DRAFT CAPITAL IMPROVEMENT BUDGET (CIB) FOR 2004 -05 AND THE DRAFT 2004 TEN -YEAR CAPITAL IMPROVEMENT PLAN (CIP), APPROVE THE 2004 CIP, AND APPROVE THE CIB FOR INCLUSION IN THE 2004 -05 DISTRICT BUDGET In order to accommodate the cash -flow needs resulting from the timing of required expenditures versus the receipt of revenues, the Sewer Construction Fund has historically been managed to have a prudent reserve of 75 percent of the following year's anticipated project expenditures plus 100 percent of debt retirement service at the end of each fiscal year (June 30). In the last five years, we have also evaluated the balance needed in the Sewer Construction Fund to act in conjunction with the O & M Fund balance to meet the cash flow needs of the District. A cash flow table is included in the Ten -Year Capital Plan and indicates the revenue needed to support the ten -year expenditures. Staff has evaluated the CIB and CIP and concluded that they are exempt from the California Environmental Quality Act (CEQA) under District CEQA Guidelines Section 15262, since they are planning studies. Approval of the budget and plan will establish the Board of Directors' independent finding that these documents are exempt from CEQA. RECOMMENDED BOARD ACTION: Conduct a public hearing to receive comments on the CIB and CIP. Approve the draft 2004 CIP. Approve the draft CIB for inclusion in the 2004 -05 District Budget. UAPosition Papers \Mercurio \CIP -CIB Hearing (04).doc Page 3 of 4 ATTACHMENT 1 CAPITAL IMPROVEMENT BUDGET SUMMARY FY 2004 -05 'This number represents funds that have been authorized by the Board, allocated to projects by the General Manager, but not spent during FY 2003 -04. WPosition PapersWercurioUP -013 Hearing Attachment 1 (04).doc Page 4 of 4 CARRY -OVER ADDITIONAL TOTAL PROPOSED ESTIMATED PROGRAM FROM AUTHORIZATION AUTHORIZATION FY 2004 -05 FY 2003 -041 REQUESTED EXPENDITURES Treatment Plant 3,452,000 5,167,000 8,619,000 6,010,000 Collection 16,085,000 12,341,000 28,426,000 19,166,000 System General 270,000 3,011,000 3,281,000 2,255,000 Improvements Recycled Water 1,415,000 235,000 1,650,000 665,000 Total FY 2004 -05 21,222,000 20,754,000 41,976,000 28,096,000 'This number represents funds that have been authorized by the Board, allocated to projects by the General Manager, but not spent during FY 2003 -04. 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O Ln N N f� dam' N N o � ipf- w D o Ln z o ui N X p w M O � w w C W rn m U a fu W Q Q Q m W O O Q U F- OC F- > LI w Q Q O �n s to X 0- O O 0 c o vn .o L 'c Ln ' nC: E o fo X M � C) ru cn U E o oC) � N O CL — N .i� V) O C O V a=' E p C O N `+-- cn X o O N o >. O Ln a f� E N N o w 4, E E to X 0- O O E Q � O N O O ro — L O Ln ' O E o \ ° X M � C) Q � z 0 a z w O U W W H w a— W O O O N 17 LA d' N C) O O O O O o N CT N o � O O O Q C O O O O C W � DG c � � H E a) D W N C > Z a a- m a I=- cn 0 O N _0 W E w —i d c u H a� W U M O O N i N O a-1 U O cr N a� CL x aD Q) v c a� c c O U i �O O ° O LO O V) O Q cu 4-J N 2- -VR- C � N N c EL E E O O U Cl o = V) O Q Central Contra Costa San.,ary District vBOARD OF DIRECTORS POSITION PAPER Board Meeting Date: May 20, 2004 No.: 5.a. BIDS AND AWARDS Type of Action: AUTHORIZE AWARD subject: AUTHORIZE AWARD OF CONSTRUCTION CONTRACT TO MOUNTAIN CASCADE, INC. FOR THE PLEASANT HILL ROAD EAST IMPROVEMENTS, DISTRICT PROJECT 5553 Submitted By: Initiating Dept./Div.: Alex Rozul, Associate Engineer Engineering / Capital Projects REVIEWED AND RECOMMENDED FOR BOARD ACTION: rR - 1 tA A. Rozul i ecki W. Brennan M-a A. Farrell General ISSUE: On May 4, 2004, sealed bids were received and opened for construction of the Pleasant Hill Road East Improvements Project, DP 5553. The Board of Directors must authorize award of the contract or reject bids within 50 days of the bid opening. RECOMMENDATION: Authorize award of a construction contract to Mountain Cascade, Inc. FINANCIAL IMPACTS: Approximately $2,090,000 including bid price, contingency, construction management. Approximately $389,000 will be reimbursed by the City of Martinez in accordance with the Joint Powers Agreement. ALTERNATIVES /CONSIDERATIONS: Reject all bids, which is not recommended. BACKGROUND: The Collection System Master Plan Update of March 2000 identified severely under - capacity sewers within the corridor from Christie Drive to Forrest Way, Pleasant Hill Road East to Brackman Lane, and Brackman Lane to Highway 4 on -ramp. The sewer model calculated flows to these lines are anywhere from 170 — 750 percent of capacity. Surcharge indicators placed in manholes confirmed significant capacity issues. A project was planned and designed to replace approximately 6,000 feet of 6- through 10 -inch sewers with appropriately sized pipes. The sewer replacement includes a crossing at Alhambra Creek, work within Burlington Northern and Santa Fe (BNSF) Railway property, and work crossing a Caltrans Highway 4 on -ramp at Alhambra Avenue. During interagency plan review, the City of Martinez (City) informed the District that a waterline replacement project was planned within Pleasant Hill Road East. Both agencies agreed that combining the work into a joint project would be cost efficient and least disruptive to the residents. A Joint Powers Agreement (JPA) was authorized by the Board and entered into with the City of Martinez creating the joint project, Pleasant Hill Road East Improvements, DP 5553 (see Attachment 1). In accordance with the 1ADesignTosition Papers\2004\5553 Award- avr.DOC Page 1 of 5 POSITION PAPER Board Meeting Date: May 20, 2004 subject. AUTHORIZE AWARD OF CONSTRUCTION CONTRACT TO MOUNTAIN CASCADE, INC. FOR THE PLEASANT HILL ROAD EAST IMPROVEMENTS, DISTRICT PROJECT 5553 JPA, the District is the lead agency for the project; however, City Council approval is required to award the waterline portion of the project. City staff has reviewed the bids and is recommending acceptance of the waterline portion of the bid to the City Council at their May 19, 2004 meeting. District staff prepared the plans and specifications for this project and the engineer's estimate for construction was $2,319,000. The project was advertised on April 12 and 19, 2004. Nine sealed bids were received and publicly opened on May 4, 2004. Bids ranged from $1,567,081 to $2,646,875, and a summary of bids is shown in Attachment 2. Staff conducted a commercial and technical evaluation of these bids and has determined that Mountain Cascade Inc. is the lowest responsive and responsible bidder with a bid amount of $1,567,081. District staff will perform construction contract management, administration, and survey for the entire joint project and will perform inspection, office engineering, and shop drawing review for the sewer portion. The City staff will perform the inspection, office engineering and shop drawing review for the waterline and pavement overlay. The funds required to complete the project, as shown in Attachment 3, are $2,075,143. In accordance with the JPA, the City will reimburse the District approximately $389,000. The total cost of the project, including City improvements is $2,273,143. The sewer work for the Pleasant Hill Road East Improvements Project is included in the Fiscal Year 2003 -04 Capital Improvement Budget (CIB) on pages CS -72 through CS- 75. Staff has conducted a cash flow analysis of the Sewer Construction Fund and concluded that adequate funds are available for this project. The project is exempt from California Environmental Quality Act (CEQA) under District CEQA Guidelines, Section 15302, since it involves replacement of existing facilities in substantially the same location and with the same purpose as the facilities being replaced. Any capacity increases provided by the project are non - growth related and are to accommodate wet weather flows. RECOMMENDED BOARD ACTION: Authorize award of a construction contract in the amount of $1,567,081 for the Pleasant Hill Road East Improvements, District Project 5553, to Mountain Cascade, Inc., the lowest responsive and responsible bidder. (:\Design \Position Papers\2004 \5553 Award- avr.DOC Page 2 of 5 AV i AVE HIGHWAY �_4 Ft. B.N. & &F. R.R. PARK rk j 3W 6w LEGEND: Ing ----------- I FEET Central Contra Costa ;? Sanitary District III I MUMP4 NEW SEWERS -------- EXISTING SEWERS NEW CITY WATER LINE MARTINEZ-PLEASANT HILL RD EAST PROJECT IMPROVEMENTS D.P. 5553 Page 3 of 5 ATTACHMENT 2 CENTRAL CONTRA COSTA SANITARY DISTRICT SUMMARY OF BIDS PROJECT NO. 5553 DATE: MAY 4, 2004 PROJECT NAME: PLEASANT HILL ROAD EAST IMPROVEMENTS LOCATION: MARTINEZ, CALIFORNIA ENGINEER EST.: $2,319,000 NUMBER BIDDER (Name & Address) BID PRICE 1 Mountain Cascade $1,567,081 Livermore, CA 2 Bay Pacific Pipelines, Inc. $1,589,635 Novato, CA 3 California Trenchless, Inc. $1,803,130 Hayward, CA 4 Ranger Pipelines, Inc. $1,953,970 San Francisco, CA 5 Hess Construction Co., Inc $1,973,840 American Canyon, CA 6 K.J. Woods construction, Inc. $1,984,000 San Francisco, CA 7 Pacific Underground Construction, Inc. $2,048,070 San Jose, CA 8 William G. McCullough Co. $2,333,615 Antioch, CA 9 W.R. Forde Associates $2,646,875 Richmond, CA BIDS OPENED BY: /s/ Joyce E. Murphy DATE: May 4, 2004 SHEET NO. 1 OF 1 I:\Design\Position Papers\2004 \5553 Award- avr.DOC Page 4 of 5 ATTACHMENT 3 PLEASANT HILL ROAD EAST IMPROVEMENTS DISTRICT PROJECT 5553 POST BID / PRECONSTRUCTION COST ESTIMATE TOTAL ITEM DESCRIPTION 1. CONSTRUCTION a. Construction Contract 1,567,081 b. Contingency (15 %) 235,062 c. Permit 15,000 TOTAL CONSTRUCTION 1,817,143 2. CONSTRUCTION MANAGEMENT a. District Forces Construction Management 50,000 Contract Administration /Inspection 100,000 Project Engineering 10,000 Community Relations 12,000 SUBTOTAL 172,000 b. Consultants Geotech 10,000 Material Testing 11,000 Arborist 3,000 SUBTOTAL 24,000 TOTAL CONSTRUCTION MANAGEMENT 196,000 3. TOTAL CONSTRUCTION PHASE COST 2,013,143 4. TOTAL PREBID EXPENDITURES (Planning and Design) 260,000 5. TOTAL DESIGN AND CONSTRUCTION MANAGEMENT 456,000 6. TOTAL ESTIMATED PROJECT COST 2,273,143 7. FUNDS AUTHORIZED TO DATE 198,000 8. ALLOCATION NEEDED TO COMPLETE PROJECT 2,075,143 % OF ESTIMATED CONSTRUCTION COST 100.00 10.79 110.79 14.31 25.09 I: \Design \PositionPaper\2004 \5553 Award Aft -3 Page 5 of 5 r m z r r O v vM C�1 C�1 � W O m c m z I m X O C. m 0 co 0 O O O 0 0 Q O CD : � 0) CD C CD 0- ° o 0 00 0 T CL O D -a 0 T 3 �CD CD O . CD C: o CL m "n z � -�� - C(D -69 .� o . O sv 3 N w O L 0- CD N Q. (D Oo O O 00 cz G) 07 Cr-l- Q X cn CD CL cn cDD 3' CD C) flJ 00 O -0 � c Q L. � � CD O' CD CD O I % m ET CD i n 0 -co a' = p CD O D < o. 0 CD o 0 o wr--I- C cn �. CD — CD CD O O' cn N' CD cn r m z r r O v vM C�1 C�1 � W O m c m z I m X O C. m 0 i-- ALHAMBRA ti AVE t/ \Q HIGHWAY i Fes, IN SF. PFi, Z' _ ; n B.N. 8 S.F. R.R „ °�\ O i oo 15m 11, BRACKMAN LN V. li CO, _ / L - 4 : Ocn ALHAMBRA N � ; UPTON Rp. 2 m , NANCY BOYD a' PARK �oE _ �,� - -- Ate_, `�• ! PEE _ - -- �m' y JOSC S1+ i JQ V I VINE HILL 1 WAY n < n 13 n c o soo soo LEGEND: NEW SEWERS %�Pt FEET -- -- - - -- EXISTING SEWERS NEW CITY WATER LINE a Central Contra Costa Sanitary District MARTIN EZ—PLEASANT HILL RD EAST a PROJECT IMPROVEMENTS D.P. 5553 n Y° it �. > "� �� r \'�"' r %/! #��'[ P tWt- �•4 r r .,,{r,yf,fj,• �`' }1 t4��fs �: � ryy r ,u j- • `�`` ,,�'s , � �S /w "!r�rs ���di �.y S �* �,t F, i Y � /'- P IS ITS I t in�� ✓ ,,..� .. .+t i/ tea_ ry'.�a��< ' ''('. Ali® / /p., '-r ` ey ► �' , +►`j NJf i s Or Art f '� FFQee t Y rJ ,d. li � r � r � � ,• S - 1! a • f � y�j �� it ,�.. _ +D, r ~yi s � � i f" � • c} Tcr t Central Contra Costa San..ary District ' BOARD OF DIRECTORS POSITION PAPER Board Meeting Date: May 20, 2004 No.: 5.b. BIDS AND AWARDS Type of Action: AUTHORIZE AWARD subject: AUTHORIZE AWARD OF CONSTRUCTION CONTRACT TO D'ARCY & HARTY CONSTRUCTION, INC. FOR THE WALNUT CREEK SEWER RENOVATION PROJECT, PHASE 2, DISTRICT PROJECT 5709 Submitted By: Initiating Dept /Div.: Andrew Antkowiak, Associate Engineering / Capital Projects Engineer REVIEWED AND RECOMMENDED FOR BOARD ACTION. A. Antkowiak 4ilecki W. Brennan A. FarrcM harle Ba General ISSUE: On May 11, 2004, sealed bids were received and opened for the construction of the Walnut Creek Sewer Renovation Project, Phase 2, District Project 5709. The Board of Directors must authorize award of the contract or reject bids within 50 days of the bid opening. RECOMMENDATION: Authorize award of a construction contract. FINANCIAL IMPACTS: Approximately $1,572,000 including design, bid price, contingency, and construction management. ALTERNATIVES /CONSIDERATIONS: Reject all bids, which is not recommended. BACKGROUND: The District's 1,500 miles of collection sewers has pipe segments that range in age from new to over 100 years old. Some of these pipe segments are at the end of their useful life. This is evidenced by high maintenance costs and increases in call -outs by Collection System Operations Division (CSOD). In 1991 the District implemented its sewer renovation program. Since that time an annual allowance for this program has been included in the Capital Improvement Budget and Plan. This program is an ongoing series of projects. Candidate sewer line segments are identified, evaluated, and placed on a priority list for replacement and /or renovation. The Walnut Creek Sewer Renovation Project, Phase 2, will renovate or replace several critical line segments identified in the City of Walnut Creek and unincorporated Contra Costa County area. Walnut Creek Sewer Renovation Project, Phase 2, will reconstruct approximately 5,500 linear feet of 6 -, 8 -, and 10 -inch sewer lines in fourteen (14) locations (see Attachment 1 for map). Five (5) sites are located in public Right of Way, four (4) in easements and private streets, and the remaining five (5) are in both easements and public Right of lADesign \Position Papers\2004 \5709 Award.DOC Page 1 of 5 POSITION PAPER Board Meeting Date: May 20, 2004 subject AUTHORIZE AWARD OF CONSTRUCTION CONTRACT TO D'ARCY & HARTY CONSTRUCTION, INC. FOR THE WALNUT CREEK SEWER RENOVATION PROJECT, PHASE 2, DISTRICT PROJECT 5709 Way. Construction of the sewers in easements will involve close cooperation with customers for site access and restoration. Because one site in downtown Walnut Creek will have a significant impact on traffic and local businesses, it is required to be constructed during the night. District staff prepared the plans and specifications for the project. The Engineer's estimate for construction of Phase 2 is $1,100,000. This project was advertised on April 16 and 22, 2004. Four (4) sealed bids ranging from $1,015,332 to $1,312,120 were received and publicly opened on May 11, 2004. The Engineering Department conducted a technical and commercial review of the bids and determined that D'Arcy & Harty Construction, Inc. is the lowest responsive and responsible bidder with a bid amount of $1,015,332. A summary of bids received is shown in Attachment 2. The District will administer the construction contract and will provide contract administration, inspection, survey, office engineering, and submittal review. The funds required to complete this project, as shown in Attachment 3, are $1,372,000. The total cost of Walnut Creek Sewer Renovation Project, Phase 2 is anticipated to be $1,572,000. The improvements to the Walnut Creek sewers are included in the Fiscal Year 2003 -04 Capital Improvement Budget (CIB) on pages CS- 9 -15. Staff has conducted a cash flow analysis of the Sewer Construction Fund and concluded that adequate funds are available for this project. At its February 5, 2004 meeting, the Board of Directors independently found that this project was exempt from CEQA. A Notice of Exemption has been filed with the County Clerk. RECOMMENDED BOARD ACTION: Authorize award of a construction contract in the amount of $1,015,332 for the construction of the Walnut Creek Sewer Renovation Project, Phase 2, District Project 5709, to D'Arcy & Harty Construction, Inc., the lowest responsive and responsible bidder. I: \Design \Position Papers\2004 \5709 Award.DOC Page 2 of 5 FEET Central Contra Costa Sanitary District WALNUT CREEK RENOVATIONS PHASE 2 CCCSD 5709 Attachment Page 3 of 5 ATTACHMENT 2 CENTRAL CONTRA COSTA SANITARY DISTRICT SUMMARY OF BIDS PROJECT NO. 5709: Walnut Creek Sewer Renovations Phase 2 DATE: May 11, 2004 LOCATION: Walnut Creek, California ENGINEER EST.: $1.100.000 ORDER BIDDER BID PRICE OPENED (Name & Address) California Trenchless 1 2283 Dunn Road $1,237,575 Hayward, CA 94545 D'Arcy & Harty Construction, Inc. 2 1300 Carroll Avenue $1,015,332 San Francisco, CA 94124 McNamara & Smallman Construction, Inc. 3 1756 Holmes Street $1,312,120 Livermore, CA 94550 K. J. Woods Construction, Inc. 4 2625 Judah Street, No. 2 $1,184,000 San Francisco, CA 94122 BIDS OPENED BY: /s/ Joyce Murphy DATE: May 11, 2004 SHEET NO. 1 OF 1 L \Design \Position Papers\2004 \5709 Award.DOC Page 4 of 5 ATTACHMENT 3 WALNUT CREEK SEWER RENOVATIONS, PHASE 2 DISTRICT PROJECT NO 5709 POST - BID/ PRECONSTRUCTION ESTIMATE ITEM DESCRIPTION 1. Construction Contract Contingency at 15% Subtotal 2. Construction Management Percent TOTAL of Construction Contract Cost $ 1,015,332 $ 152,668 $1,168,000 Construction Project Management $ 15,000 Contract Administration $ 25,000 Construction Inspection $ 95,000 Subtotal $ 135,000 3. Consultant Services Materials Testing $ 10,000 Geotechnical Consultant $ 2,000 Arborist $ 6,000 Subtotal $ 18,000 4. Engineering and Other Services During Construction District Forces 100% 11.6% 1.5% 3.5% 18.0% 134.6% Page 5 of 5 Public Relations $ 5,000 Office Engineering Services $ 5,000 Record Drawings $ 5,000 Survey $ 15,000 Operations Department $ 1,000 Other Services City and County Permit Inspection $ 10,000 Subtotal $ 41,000 5. Prebid Expenditures (Planning and Design)' $ 210,000 6. Total Project Cost $ 1,572,000 7. Funds Allocated to Date $ 210,000 8. Allocation Required to Complete Project $ 1,362,000 9. Total Additional Expenditures if Contract $ 1,362,000 is Awarded Note 1: Includes planning and pre- design of phases 3 and 4 100% 11.6% 1.5% 3.5% 18.0% 134.6% Page 5 of 5 Central Contra Costa San.tary District ' BOARD OF DIRECTORS POSITION PAPER Board Meeting Date: May 20, 2004 No.: 7.a. ADM I N I STRAT I V E Type of Action: ADOPT RESOLUTION /APPROVE REGULATIONS subject: ADOPT A RESOLUTION REQUESTING CONSOLIDATION OF THE ELECTION OF DISTRICT BOARD MEMBERS WITH THE STATEWIDE GENERAL ELECTION ON NOVEMBER 2, 2004 AND SETTING FORTH DISTRICT REGULATIONS FOR CANDIDATE STATEMENTS Submitted By: Joyce E. Murphy, Initiating Dept. /Div.: Administrative Department Secretary of the District REVIEWED AND RECOMMENDED FOR BOARD ACTION: J. M phy General ISSUE: A request for consolidation of the election of District Board Members must be filed with the Board of Supervisors and County Elections Department, and the District regulations relating to candidate statements must be modified or reaffirmed. RECOMMENDATION: Request consolidation of District election with Statewide General Election, and reaffirm or modify District regulations for candidate statements. FINANCIAL IMPACTS: If the Board reaffirms the current District regulations for candidate statements, the District would be responsible for paying the balance of the cost of printing each candidate's statement over the initial $500 paid by each candidate. In the last District Board election in 2002, that cost was $2,522.13 per candidate less $500, and there were three candidates for a total of $6,066.40. ALTERNATIVES /CONSIDERATIONS: Statutory provisions effectively require the District to consolidate its election when it is held on a statewide election date. District regulations for candidate statements may be modified or reaffirmed in accordance with California Elections Code Section 13307. BACKGROUND: The California Elections Code provides that Special Districts may require that elections of their Board Members be held on the same day as the Statewide General Election. When an election called by a District is consolidated with a Statewide General Election, the District must file a resolution with the Board of Supervisors and County Elections Department requesting such consolidation. Page 1 of 5 POSITION PAPER Board Meeting Date: May 20, 2004 subject: ADOPT A RESOLUTION REQUESTING CONSOLIDATION OF THE ELECTION OF DISTRICT BOARD MEMBERS WITH THE STATEWIDE GENERAL ELECTION ON NOVEMBER 2, 2004, AND SETTING FORTH DISTRICT REGULATIONS FOR CANDIDATE STATEMENTS The Board of Directors must also reaffirm or modify the District regulations with regard to word limit, payment of costs, and payment of a deposit for candidate statements for the November 2, 2004 District election. Prior to 1996 the District had required that candidates pay all pro rata costs concerning publication of their respective candidate statements. In 1996 because of the prohibitive cost of candidate statements for this District as compared to other agencies and the need for informing citizens of qualifications of candidates for the District Board of Directors, the Board voted to have the District share in the cost of publication of candidate statements to provide the benefits of informing citizens of the qualifications of candidates, to minimize the issue of campaign contributions from special interests, and to remove financial obstacles for interested candidates to run for election. Currently, the District regulations require that candidates seeking election to the District Board of Directors be responsible for paying $500 towards the cost of publication of his /her respective candidate statement at the time of filing nomination papers; that the balance be paid by the District after the elections costs have been determined; and that the statements be limited to 400 words. In 2002 the Contra Costa County Elections Department changed the type font of candidate statements to 10 point, causing candidate statements of more than 300 words to require two pages, doubling the printing cost. It would be appropriate for the Board to consider whether to modify the word limit for candidate statements to 300 words to ensure that all candidate statements will be printed on one page, or to reaffirm District regulations that candidate statements may contain up to 400 words, recognizing that some candidate statements may be printed on two pages and the cost would double. A draft resolution is attached for the Board's consideration and direction to staff. A copy of the final resolution requesting consolidation of the election and incorporating the Board's direction with regard to determination of District regulations for candidate statements, will be provided to the Contra Costa County Board of Supervisors and Elections Department. RECOMMENDED BOARD ACTION: Adopt resolution requesting consolidation of the election of District Board Members with the Statewide General Election to be held on November 2, 2004, and setting forth District regulations relating to candidate statements. Page 2 of 5 RESOLUTION NO. 2004- RESOLUTION OF THE BOARD OF DIRECTORS OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT REQUESTING CONSOLIDATION OF THE ELECTION OF ITS DISTRICT BOARD MEMBERS WITH THE STATEWIDE GENERAL ELECTION AND SETTING FORTH DISTRICT REGULATIONS RELATING TO CANDIDATE STATEMENTS WHEREAS, California Elections Code Section 10402.5 provides that any district election held on an established statewide election date shall be consolidated with the statewide election; and WHEREAS, California Elections Code Section 10403 provides that whenever an election called by the governing body of a special district, such as the Central Contra Costa Sanitary District, for an office to be filled which is to appear on the same ballot as the statewide election, the District shall, by resolution, request consolidation of elections for its members to be held on the same day as the Statewide General Election; and WHEREAS, Elections Code Section 13307 provides that each candidate for nonpartisan elective office in any local agency, including special districts, may prepare a candidate's statement on an appropriate form provided by the clerk; and WHEREAS, Elections Code Section 13307 further requires that before the nominating period opens the District Board must determine whether a charge shall be levied against each candidate submitting a candidate's statement to be sent to the voters; and WHEREAS, Elections Code Section 12112 requires the elections official of the principal county to publish a notice of the election once in a newspaper of general circulation in the district. Page 3 of 5 Central Contra Costa Sanitary District Resolution No. 2004 - Page 2 NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Central Contra Costa Sanitary District, that the Board does hereby make the following determination: IT IS ORDERED that an election be held within the territory included in the Central Contra Costa Sanitary District on the 2nd day of November 2004, for the purpose of electing members to the Board of Directors of Central Contra Costa Sanitary District in accordance with the following specifications. 1. The election shall be held on Tuesday, the 2nd day of November 2004. The purpose of the election is to choose members of the Board of Directors for three (3) seats for four -year terms beginning December 3, 2004 and ending December 5, 2008. 2. The Central Contra Costa Sanitary District hereby requests and consents to the consolidation of this election with other elections which may be held in whole or in part of the territory of the District, as provided in Elections Code 10400. 3. The Central Contra Costa Sanitary District has determined that the candidate and the Central Contra Costa Sanitary District shall share in the cost of publication of the Candidate Statements. 4. Each candidate shall pay $500 for the cost of publication of his /her respective candidate statement at the time of filing nomination papers, and the balance shall be paid by the Central Contra Costa Sanitary District after the election costs have been determined. 5. Each candidate's statement of qualifications shall be limited to 20( 0, 300 or 400 words). Page 4 of 5 Central Contra Costa Sanitary District Resolution No. 2004 - Page 3 6. The Central Contra Costa Sanitary District directs that the Contra Costa County Registrar of Voters publish the notice of election in a newspaper of general circulation that is regularly circulated in the territory. BE IT FURTHER RESOLVED that the Secretary of the District is hereby authorized and directed to transmit a certified copy of this resolution to the Contra Costa County Board of Supervisors and to the Elections Department of said County. PASSED AND ADOPTED by the Board of Directors of Central Contra Costa Sanitary District this 20th day of May 2004, by the following vote: AYES: Members: NOES: Members: ABSENT: Members: COUNTERSIGNED: Secretary of the Central Contra Costa Sanitary District, County of Contra Costa, State of California Approved as to Form: President of the Board of Directors, Central Contra Costa Sanitary District, County of Contra Costa, State of California Kenton L. Alm District Counsel Page 5 of 5 Central Contra Costa Sank.ery District ' BOARD OF DIRECTORS POSITION PAPER Board Meeting Date: May 20, 2004 No.: g.a. ENGINEERING Type of Action: ADOPT RESOLUTION; APPROVE AGREEMENT Subject: ADOPT A RESOLUTION APPROVING A JOINT COMMUNITY FACILITIES AGREEMENT FOR FINANCING OF PUBLIC MAIN SEWERS IN WINDEMERE BLC'S DOUGHERTY VALLEY DEVELOPMENT AND AUTHORIZE THE PRESIDENT OF THE BOARD OF DIRECTORS AND THE SECRETARY OF THE DISTRICT TO EXECUTE THE AGREEMENT Submitted By: Jarred Miyamoto -Mills Initiating DeptJDiv.: Engineering/ Principal Engineer Environmental Services REVIEWED AND RECOMMENDED FOR BOARD ACTION. )I v oA J. Miyamoto -Mills Swanson A.-Farrill K. Alm General ISSUE: Windemere BLC Land Company (Windemere BLC) plans to form a community facilities district to finance infrastructure improvements (including public main sewers) for the remaining phases of its Dougherty Valley development. State law requires that agencies such as the District that will ultimately own and operate the facilities enter into a "Joint Community Facilities Agreement" with the financing authority, the ABAG Finance Authority for Nonprofit Corporations, in this case. RECOMMENDATION: Adopt a resolution approving the Joint Community Facilities Agreement and authorizing the President of the Board of Directors and the Secretary of the District to execute the agreement. FINANCIAL IMPACTS: None. ALTERNATIVES /CONSIDERATIONS: The Board could decline to enter into the recommended agreement, which would result in exclusion of public main sewers from financing under the proposed community facilities district. Windemere BLC would then have to find an alternative means to finance design and construction of public main sewers in the remainder of its development. BACKGROUND: To date, Windemere BLC has used both public and private financing for infrastructure improvements in Dougherty Valley. It now plans to form a community facilities district to finance a portion of similar improvements (including public main sewers) in remaining phases of the development using tax - exempt bonds. The State law governing issuance of these bonds requires that agencies that will ultimately own and operate the infrastructure improvements built with the community facilities district financing enter into an agreement with the authority that will sell the bonds. In this case, WPosition Papers\Miyamoto -Mills \Windemere BLC.DOC Page 1 Of 12 POSITION PAPER Board Meeting Date: May 20, 2004 subject. ADOPT A RESOLUTION APPROVING A JOINT COMMUNITY FACILITIES AGREEMENT FOR FINANCING OF PUBLIC MAIN SEWERS IN WINDEMERE BLC'S DOUGHERTY VALLEY DEVELOPMENT AND AUTHORIZE THE PRESIDENT O F T HE B OARD O F D IRECTORS A ND T HE SECRETARY OF THE DISTRICT TO EXECUTE THE AGREEMENT Windemere BLC has requested that the ABAG Financing Authority for Nonprofit Corporations form the district and sell the bonds. Bond Counsel for the proposed Community Facilities District No. 2004 -2 ( Windemere Ranch) submitted a draft resolution and "Joint Community Facilities Agreement - CCCSD" to staff. District Counsel reviewed the documents and worked with Bond Counsel to incorporate minor format revisions. The recommended resolution and agreement are presented as Attachments 1 and 2. The agreement provides that customary District procedures and requirements for design and construction of public sewers be followed. Further, the District will have no liability with respect to any work performed in connection with the improvements until they are accepted, and will not be obligated to accept the constructed facilities unless they meet all District standards, specifications, and regulations. RECOMMENDED BOARD ACTION: Adopt a resolution approving the Joint Community Facilities Agreement and authorizing the President of the Board of Directors and the Secretary of the District to execute the agreement. Page 2 of 12 UAPosition Papers\Miyamoto- Mills\Windemere BLC.DOC M"TA[S3:1►0Iafys RESOLUTION NO. 2004- A RESOLUTION OF THE BOARD OF DIRECTORS OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT APPROVING A JOINT COMMUNITY FACILITIES AGREEMENT RELATING TO THE FINANCING OF PUBLIC IMPROVEMENTS BY THE ABAG FINANCE AUTHORITY FOR NONPROFIT CORPORATIONS COMMUNITY FACILITIES DISTRICT NO. 2004 -2 (WINDEMERE RANCH) WHEREAS, the Board of Directors of the ABAG Finance Authority for Nonprofit Corporations (the "Authority ") is undertaking proceedings to form the ABAG Finance Authority for Nonprofit Corporations Community Facilities District No. 2004 -2 (Windemere Ranch) (the "CFD ") pursuant to the Mello -Roos Community Facilities Act of 1982, as amended (the "Act "); and WHEREAS, the Authority intends to issue bonds of the Authority for the CFD (the "Bonds ") in order to finance, among other improvements, the costs for construction of sanitary sewer lines and related facilities (the "Improvements ") that are expected to be owned by the Central Contra Costa Sanitary District (the "District "), as such Improvements are described in the proceedings to form the CFD; and WHEREAS, Section 53316.2 of the California Government Code allows the CFD to finance the Improvements if the District and the Authority enter into a joint community facilities agreement with respect to the Improvements to be owned or operated by the District prior to the formation of the CFD; and WHEREAS, a form of joint community facilities agreement by and between the District and the Authority relating to the Improvements to be owned or operated by the District (the "Joint Community Facilities Agreement ") has been filed with the Secretary of the District, and Page 3 of 12 WPosition PapersWiyamoto- Mills\Windemere - ATTACHMENT 1.doc WHEREAS, the Board of Directors of the District has reviewed the Joint Community Facilities Agreement, and the Board of Directors of the District now desires to approve the Joint Community Facilities Agreement and direct its execution and delivery. NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Central Contra Costa Sanitary District, as follows: Section 1 Approval of Joint Community Facilities Agreement. The Board of Directors of the District hereby approves the Joint Community Facilities Agreement in the form on file with the Secretary of the District, and hereby authorizes and directs the President of the Board of Directors to execute and deliver the Joint Community Facilities Agreement in such form. The Board of Directors of the District hereby declares that the Joint Community Facilities Agreement will be beneficial to the residents residing and to reside within the boundaries of the area in which the Improvements are being constructed. Section 2 Official Actions. The President of the Board of Directors and the Secretary of the District, and all other officers of the District, are hereby authorized and directed to take all actions and do all things necessary or desirable hereunder to implement the Joint Community Facilities Agreement, including but not limited to the execution and delivery of any and all agreements, certificates, documents and other instruments which they, or any of them, deem necessary or desirable and not inconsistent with the purposes of this Resolution and the Joint Community Facilities Agreement. WPosition Papers \Miyamoto - Mills \Windemere - ATTACHMENT tdoc Page 4 of 12 Section 3 This Resolution shall take effect upon its adoption. PASSED AND ADOPTED by the Board of Directors of the Central Contra Costa Sanitary District on the 20th day of May 2004, by the following vote: AYES: Members: NOES: Members: ABSENT: Members: President of the Board of Directors Central Contra Costa Sanitary District, County of Contra Costa, State of California COUNTERSIGNED: Secretary of the District Central Contra Costa Sanitary District, County of Contra Costa, State of California APPROVED AS TO FORM: Kenton L. Alm, Counsel for the District WPosition PapersWiyamoto- Mills\Windemere - ATTACHMENT 1.doc Page 5 of 12 ATTACHMENT 2 JOINT COMMUNITY FACILITIES AGREEMENT (CENTRAL CONTRA COSTA SANITARY DISTRICT) ABAG FINANCE AUTHORITY FOR NONPROFIT CORPORATIONS COMMUNITY FACILITIES DISTRICT NO. 2004 -2 (WINDEMERE RANCH) This Joint Community Facilities Agreement (Central Contra Costa Sanitary District) (the "Agreement "), dated for convenience as of May 1, 2004, is by and between the ABAG Finance Authority for Nonprofit Corporations (the "Authority ") and the Central Contra Costa Sanitary District (the "Participating Agency "). RECITALS: WHEREAS, the Authority is undertaking proceedings to form the ABAG Finance Authority for Nonprofit Corporations Community Facilities District No. 2004 -2 (Windemere Ranch) (the "CFD ") pursuant to the Mello -Roos Community Facilities Act of 1982, as amended (the "Act "), and the Authority intends to issue bonds of the Authority for the CFD (the "Bonds ") in order to finance various public improvements to be acquired and constructed on land in the Windemere Ranch development; and WHEREAS, the improvements to be financed with the proceeds of the Bonds may include the improvements described in Attachment A hereto (the "Improvements "), which Attachment is, by this reference, incorporated herein; and WHEREAS, the parties hereto expect that the Participating Agency will own and operate the Improvements upon their completion and acceptance by the Participating Agency; and WHEREAS, all or a portion of the Improvements and certain other improvements to be eligible for funding by the CFD are to be constructed by or at the direction of Windemere BLC Land Company LLC (the "Developer'), and the Authority expects to enter into an Acquisition Agreement with the Developer (the "Acquisition Agreement ") whereby the Authority will use proceeds of the Bonds to reimburse the Developer for all or a portion of the costs of other improvements; and WHEREAS, Section 53316.2 of the Act requires that the Authority and the Participating Agency enter into a joint community facilities agreement with respect to the Improvements, prior to the adoption by the Authority of the Resolution of Formation of the CFD, if the Improvements are to be financed with the proceeds of the Bonds; and WPosition PapersWiyamoto- MillsUindemere - ATTACHMENT 2.doc Page 6 of 12 WHEREAS, the Authority and the Participating Agency now desire to enter into this Agreement to satisfy the requirements of Section 53316.2 of the Act and to memorialize their understanding with respect to the proceeds of the Bonds and the Improvements, all as more particularly set forth below. AGREEMENT.- NOW, THEREFORE, in consideration of the foregoing and mutual covenants set forth below, the parties hereto do hereby agree as follows: Section 1 Reservation of Bond Funds. The Authority intends to use proceeds of the Bonds to finance a portion of the costs incurred in connection with the acquisition and construction of the Improvements. Said amount, together with any investment earnings thereon, shall be held in an account within the Improvement Fund established for the CFD (the "Improvement Fund ") for the sole and exclusive benefit of the CFD, and such amount shall in no way be pledged as security for the Bonds. Other than proceeds of the Bonds required by the Acquisition Agreement to be used to finance the Improvements, the Authority shall have no obligation to pay for any of the costs of the Improvements, including but not limited to any costs of planning, acquisition, construction, installation or inspection of the Improvements. Any costs of the Improvements in excess of the proceeds of the Bonds available to pay such costs will be paid by the Developer and /or the other landowners in the CFD. Section 2 Construction of Improvements. The Improvements have been or will be constructed pursuant to plans and specifications approved in accordance with the Memorandum of Understanding Between Contra Costa County, the City of San Ramon, Shapell Industries and Windemere Ranch Partners Relating to Development of Dougherty Valley, dated October 15, 1997 (the "MOU ") and otherwise applicable requirements of the Participating Agency. The Participating Agency shall not have any liability whatsoever in respect of any work performed in connection with the Improvements; provided that this sentence shall in no way limit any rights the Participating Agency may have against any persons or entities in respect of the acquisition or construction of the Improvements once the Participating Agency accepts title to and control over the Improvements. Section 3 Acceptance; Use of Bond Funds. Upon completion of the Improvements consistent with the requirements of the MOU and any otherwise applicable requirements of the Participating Agency, the Participating Agency shall WPosition PapersWiyamoto- Mills\Windemere - ATTACHMENT 2.doc Page 7 of 12 accept dedication of the Improvements in accordance with its customary procedures, and shall accept ownership, and responsibility for operation of the Improvements conditioned in any event upon the passage to the Participating Agency of fee title clear of all encumbrances and easements not otherwise acceptable to the Participating Agency in its sole discretion. The Participating Agency shall have no responsibility with respect to the ownership or operation of the Improvements unless and until construction has been completed to the satisfaction of the Participating Agency and acceptance of the Improvements by the Participating Agency has occurred. The Authority shall have no obligation to at any time own or operate any of the Improvements. Section 4 Limited Obligations. All obligations of the Authority under and pursuant to this Agreement shall be limited to the amounts on deposit in the Improvement Fund and described in Section 1 above and available for use in payment of any obligation of the Authority hereunder. No Board member, member of the Executive Committee of the Board, officer, employee or agent of the Authority shall in any event be personally liable hereunder. The sole obligation of the Participating Agency hereunder with respect to the Improvements shall be to accept ownership of the Improvements when they have been completed to the satisfaction of the Participating Agency. If, for any reason whatsoever, there are insufficient funds to complete the Improvements or any portion thereof, neither the Authority nor the Participating Agency shall have any obligation to fund any such shortfall. If the Participating Agency shall fail to perform any of its obligations hereunder, the sole remedy of the Authority shall be the commencement of an action in the Superior Court for specific performance by the Participating Agency of such obligations. Section 6 Termination. Notwithstanding any other provision of this Agreement, this Agreement shall cease to be effective and shall terminate if the Bonds are not issued by December 1, 2005. If not earlier terminated pursuant to the preceding sentence, this Agreement shall terminate upon acceptance of the ownership and operation of the Improvements by the Participating Agency, and disbursement of all amounts from the Improvement Fund to pay costs of the improvements eligible to be funded by the CFD. Section 7 No Obligation to Form CFD; Agreement to Benefit to Residents. The provisions of this Agreement shall in no way obligate the Authority to form the CFD. Notwithstanding the foregoing, by their respective execution of WPosition PapersWiyamoto- Mills\Windemere - ATTACHMENT 2.doc Page 8 of 12 this Agreement, the Authority and the Participating Agency each declare that this Agreement is beneficial to the residents within the jurisdiction of their respective entities in assuring the provision of financing for a portion of the costs of the Improvements in furtherance of the purposes of the Act. Section 8 Partial Invalidity. If any part of this Agreement is held to be illegal or unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall be given effect to the fullest extent reasonably possible. Section 9 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto. This Agreement is for the sole benefit of the Authority and the Participating Agency and their successors and assigns, and no other person or entity shall be deemed to be a beneficiary hereof or have an interest herein. Section 10 Execution in Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original. WPosition Papers \Miyamoto - Mills \Windemere - ATTACHMENT 2.doc Page 9 of 12 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year written alongside their signature below. PASSED AND ADOPTED by the Board of Directors of the Central Contra Costa Sanitary District on the 20th day of May 2004, by the following vote: AYES: Members: NOES: Members: ABSENT: Members: President of the Board of Directors Central Contra Costa Sanitary District, County of Contra Costa, State of California COUNTERSIGNED: Secretary of the District Central Contra Costa Sanitary District, County of Contra Costa, State of California APPROVED AS TO FORM: Kenton L. Alm, Counsel for the District ABAG Finance Authority for Nonprofit Corporations (the "Authority ") Chief Financial Officer WPosition Papers \Miyamoto - Mills \Windemere - ATTACHMENT 2.doc Page 10 of 12 ATTACHMENT A DESCRIPTION OF THE IMPROVEMENTS 1. Sanitary sewer lines and facilities within or in the vicinity of the ABAG Finance Authority for Nonprofit Corporations Community Facilities District No. 2004 -2 ( Windemere Ranch) (the "CFD "), including but not limited to sewer lines adjacent to the following roadways: Albion Road Phase 2, Windemere Parkway Phases 2 and 5, East Branch Parkway Phases 4 and 5, Z Street and X Street as indicated on the map attached hereto. 2. The sanitary sewer main extension through the Middle School site including appurtenance structures. Note that the location of any such improvements on the attached map is for general reference only, and the location of any specific improvement may vary from that indicated on the attached map. WPosition PapersWiyamoto- Mills\Windemere - ATTACHMENT A.doc Page 11 of 12 Page 12 of 12 PHASE 3 CREEKS / PHASE 3 NEIGHBORHOOD PARK JAPONICA-' / s`-�� BRIDGE / r PHASE 3 / Z STREET /fJ/ �;,' !' i�� `• PHASE 2 / '.• `` NEIGHBORHOOD PARK �l 1� J PHASE 1 // I/ PHASE 2 A_U ON ROAD (� -POND 6 PHASE 1;\ 1 -� �_� !!I I� _ - MULTI fr /1 / =ter' F)UMLY !� // PHASE PONC 7 ;il �j� A. /L 11 j f � CREEKS 2 f ,PHASE WINDEMERE 'HA.SF PARKWAY /� i POCKET PARK \ Y PI IASE 2 \ r ii i PIIASE 4 , �PHASF CREEKS PHASE 4, - -� j X STREET HASE 5 / /l PHASE 4- `POND 8 i X STREET - PHASE `PHASE 4 COMMUNITY PARK PHASE 5 ' ,FEAST BRANCH PARKWAY / -' M DOLE SCHOOL\ -POND 11 J ST03M DRAIN & / PHASE 5 ' SEWER SYSTEM EAST BRANCH I i; CONNECT ON RK'MA, -PHASE 4 - - = POCKE- PARK -� -- \ PHASE 5 WINDEMERE PARKWAY POND 14- _ - COMMUNITY FACILITIES DISTRICT 2004 -2 PROPOSED FACILITIES WINDEMERE i DOUGHERTY VALLEY SPECIFIC PLAN i- Page 12 of 12 Central Contra Costa Sam-Ary District ' BOARD OF DIRECTORS POSITION PAPER Board Meeting Date: May 20, 2004 No.: 10.a. BUDGET AND FINANCE Type of Action: BUDGET REVIEW subject: RECEIVE THE 2004 -2005 OPERATIONS & MAINTENANCE BUDGET; RECEIVE THE 2004 -2005 DEBT SERVICE FUND BUDGET Submitted By: Debbie Ratcliff, Controller Initiating Dept /Div.: Administrative /Finance & Accounting REVIEWED AND RECOMMENDED FOR BOARD ACTION: l/.LI� /. D. Rat R. Musgra a Charles Batts General Manag ISSUE: The 2004 -2005 Operations & Maintenance (O &M) Budget and Debt Service Fund Budget are being submitted for review at the May 20, 2004 Board Meeting, and are scheduled for approval at the June 3, 2004 Board Meeting. RECOMMENDATION: Review the 2004 -2005 O &M Budget and Debt Service Fund Budget and provide District staff with comments and guidance leading to the approval of the Budgets at the June 3, 2004 Board Meeting. FINANCIAL IMPACTS: The 2004 -2005 O &M Budget is based on an $8 rate increase in the Sewer Service Charge (SSC), which will generate approximately $1.2 million. The total rate increases from $272 to $280 per Residential Unit Equivalent (RUE) and is allocated as follows: $204 to the O &M Fund (O &M), and $76 to the Sewer Construction Fund (Capital). The O &M portion of the Sewer Service Charge revenue decreases by $2.1 million compared to 2003 -2004 since the O &M allocation in the 2003 -2004 Budget was higher, at $218 per RUE. Presently the O &M reserve balances are over the recommended prudent reserve, and allow for a shift of SSC revenue to the Sewer Construction Fund. The O &M budget results in a deficit spending of $1,750,814, and assumes a reduction in reserves by this amount. ALTERNATIVES /CONSIDERATIONS: At the Board workshop in January, different SSC rate scenarios were considered which affect District revenues as well as the fiscal year end reserve balances. The assumption used in developing this year's budget was that only one -half of the property tax amount will be received, or $4.2 million. No property tax revenue is budgeted for O &M; this revenue has been shifted to the Debt Service Fund to cover bond principle and interest payments of $3.9 million. The remaining $300,000 will remain in the Sewer Construction Fund. To help offset reductions in revenue, staff has critically reviewed the expense side of the 2004 -2005 O &M Budget and made reductions where possible. Page 1 of 8 S:\ADMIN \POSPAPER \O &M Budget 05-04.130C POSITION PAPER Board Meeting Date: May 20, 2004 subject RECEIVE THE 2004 -2005 OPERATIONS & MAINTENANCE BUDGET; RECEIVE THE 2004 -2005 DEBT SERVICE FUND BUDGET To improve the clarity of the budget, a new Debt Service Fund has been created and is scheduled to begin in the 2004 -2005 fiscal year. The assumed receipt of ad valorem tax revenue is the main source for this fund. The fund is set up to receive the needed ad valorem tax to pay the principal and interest payments, that is, allocated revenue equals total debt service payments. Debt service payments for 2004 -2005 including the 1998 and 2002 bond issues and Recycled Water Loan total $3.9 million. BACKGROUND: Staff has developed a ten -year financial plan for forecasting revenues, expenses and fund balance. The model assists the Board and staff in addressing SSC rates for future years. Staff made a presentation at the January 29, 2004 Board Workshop recommending a 3% increase for each of the next three years resulting in an $8 SSC rate increase for 2004 -2005, an $8 rate increase for 2005 -2006, and a $9 rate increase for 2006 -2007. This initial recommendation assumed that all ad valorem tax would be received. In March, the General Manager presented to the Board a revised projection that assumed the District would receive only 50% of ad valorem tax revenue. The State has not taken a position regarding the receipt of ad valorem tax. Therefore, staff is still recommending an $8 SSC increase for next fiscal year. A public hearing is scheduled on June 3, 2004 to receive public comments. District ratepayers received a Notice of Public Hearing to Consider Rate Increase in accordance with Proposition 218. As previously stated, a new Debt Service Fund is being created in the 2004 -2005 budget process. Staff believes that showing a separate fund for debt service will help to clarify and simplify future budget presentations. Attachment I summarizes the Debt Service Fund Budget. The O &M portion of this position paper focuses on variances between projected 2003- 2004 expenses and the proposed 2004 -2005 budget; however, the position paper also notes significant variances between the budgets. Attachment II summarizes the O &M revenues, expenses, and reserve balances for the seven fiscal years 1998 -1999 through 2004 -2005 (five years of actual expenses plus 2003 -2004 projected and 2004- 2005 proposed budget numbers). Revenue: The attached draft budget includes a budget assumption increasing the SSC from $272 to $280 in total. The 0 &M allocation drops from $218 to $204 resulting in a SSC revenue decrease of $2,118,700 million compared to fiscal year 2003 -2004. There is no property tax shown in the O &M budget as it has been shifted to the Debt Service Fund to cover bond payments. The following table compares Projected 2003 -2004 to Budget 2004 -2005 Revenue: SAADMINTOSPAPEMO &M Budget 05- 04.DOC Page 2 Of 8 POSITION PAPER Board Meeting Date: May 20, 2004 Subject: RECEIVE THE 2004 -2005 OPERATIONS & MAINTENANCE BUDGET; RECEIVE THE 2004 -2005 DEBT SERVICE FUND BUDGET Total District O &M revenue for fiscal year 2003 -2004 is projected to be $44,670,019 compared to the 2004 -2005 budget amount of $42,140,100. The resulting decrease of $2,529,919 or 5.7% is mainly due to the shift of SSC revenue to the District capital program and ad valorem tax revenue to the Debt Service Fund. The loss is offset by a $450,000 increase in City of Concord revenue for shared facilities. Expense: Total District expenses are projected to be $41,821,651 (excluding $1,101,115 bond interest payment) in fiscal year 2003 -2004 as compared to a budget of $43,890,914 in 2004 -2005. This reflects a $2,069,263 or 5% increase in expenses. As expected, labor costs and utilities make up the bulk of this increase. The table below compares Projected 2003 -2004 to Budget 2004 -2005 Expense: Projected Budget Increase /Decrease ( -) 2003 -2004 2004 -2005 Variance Variance % Sewer Service Charge $ 17,468,070 19,425,872 1,957,802 11.201 (O &M portion) $ 34,002,100 31,883,400 - 2,118,700 -6.2% City of Concord 7,100,000 7,550,000 450,000 6.3% Tax Rev. for Bond Interest 1,041,319 - - 1,041,319 - 100.0% All Other 2,526,600 2,706,700 180,100 7.1% Total $ 44,670,019 42,140,100 - 2,529,919 -5.7% Total District O &M revenue for fiscal year 2003 -2004 is projected to be $44,670,019 compared to the 2004 -2005 budget amount of $42,140,100. The resulting decrease of $2,529,919 or 5.7% is mainly due to the shift of SSC revenue to the District capital program and ad valorem tax revenue to the Debt Service Fund. The loss is offset by a $450,000 increase in City of Concord revenue for shared facilities. Expense: Total District expenses are projected to be $41,821,651 (excluding $1,101,115 bond interest payment) in fiscal year 2003 -2004 as compared to a budget of $43,890,914 in 2004 -2005. This reflects a $2,069,263 or 5% increase in expenses. As expected, labor costs and utilities make up the bulk of this increase. The table below compares Projected 2003 -2004 to Budget 2004 -2005 Expense: SAADMIMPOSPAPEMO &M Budget 05- 04.DOC Page 3 Of g Projected Budget Increase /Decrease ( -) 2003 -2004 2004 -2005 Variance Variance % salaries $ 17,468,070 19,425,872 1,957,802 11.201 lenefits less Cap O/H 10,760,221 9,932,360 - 827,861 -7.701 ;hemicals 938,000 1,127,000 189,000 20.11 Itilities 3,565,060 4,004,850 439,790 12.31 repairs & Maintenance 2,862,037 2,757,003 - 105,034 -3.70) lauling & Disposal 948,060 987,060 39,000 4.10) 'rofessional & Legal 442,500 376,995 - 65,505 -14.8° Wtside Services 1,996,334 2,050,080 53,746 2.70) elf- Insurance 225,000 250,000 25,000 11.10) laterials & Supplies 1,400,937 1,480,850 79,913 5.701 JI Other (w /o debt) 1,215,432 1,498,844 283,412 23.30) otal $ 41,821,651 43,890,914 2,069,263 5.00) 998 Bond Interest 'ayment 1,101,115 1,101,115 100.00, btal Expense per 'inancials $42, 922, 766 43, 890, 914 968,148 2.39 SAADMIMPOSPAPEMO &M Budget 05- 04.DOC Page 3 Of g POSITION PAPER Board Meeting Date: May 20, 2004 subject RECEIVE THE 2004 -2005 OPERATIONS & MAINTENANCE BUDGET; RECEIVE THE 2004 -2005 DEBT SERVICE FUND BUDGET Salaries: District O &M salaries are projected to be $17,468,070 in 2003 -2004 compared to a budget of $19,425,872 in 2004 -2005 resulting in an increase of $1,957,802 or 11.2 %. This increase is mainly due to a 2% negotiated general salary increase, approximately 4% due to filling of several vacant budgeted positions, and the remaining 5% is due to step (merit) increases for newer or promoted employees within their salary ranges (in excess of 40% of the workforce). Benefits Less Capitalized Administrative Overhead: District O &M benefits less capitalized administrative overhead for the fiscal year 2003 -2004 are projected to be $10,760,221 compared to a budget of $9,932,360 in 2004 -2005. This is a decrease of $827,861, or 7.7 %. The major factors contributing to this decrease are: • The greatest impact on the 2003 -2004 Budget was a one -time $1.6 million payment to Contra Costa County Employees' Retirement Association (CCCERA) for the District's share of the Paulsen settlement in 2003 -2004 which will not occur in 2004 -2005. There was a 1 % reduction to retirement rates in 2004 -2005, but these rates will be applied to a higher salary base. The net favorable variance is $1,264,549 million. • A projected medical & health increase of $595,071. A Kaiser rate increase of 16.9% and HealthNet HMO & PPO rate increase of 16% increased the cost of coverage for existing employees by approximately $330,071. Retiree coverage increased by $265,000 or 1.9 %. There was no rate increase for Dental coverage. • Workers' Compensation expense is anticipated to decrease by $99,969. This reduction is due to a lower experience modification factor and an anticipated lower rate component, which has not yet been developed. These combined factors result in a 15% decrease applied to a higher salary base. All other benefits combined decreased by $113,995. The largest portion of this decrease is in the budgeted benefit vacancy factor of $218,000 and the decrease in life insurance premiums due to switching to a new carrier. These savings were offset by some small increases in salary driven benefits such as deferred compensation and Medicare. S:WDMIN \POSPAPER \O &M Budget 05- 04.DOC Page 4 of 8 POSITION PAPER Board Meeting Date: May 20, 2004 subject. RECEIVE THE 2004 -2005 OPERATIONS & MAINTENANCE BUDGET; RECEIVE THE 2004 -2005 DEBT SERVICE FUND BUDGET Capitalized Administrative Overhead, which is the District overhead charged to Capital Projects and credited to O &M expense, is projected to be - $2,356,779 in 2003 -2004 as compared to a 2004 -2005 budget of - $2,294,990 reflecting an increase of $61,789 in O &M expense. This is due to projected capital salaries being higher in 2003 -2004 compared to the 2004 -2005 budget. Chemicals: Chemical usage expense is projected to be $938,000 in 2003 -2004 compared to a 2004 -2005 budget of $1,127,000 for an increase of $189,000 or 20.2 %. This variance is due to a reduction in budgeted usage in 2003 -2004 in an effort to control costs. This savings will be offset by higher chemical prices and an anticipated increased 2004 -2005 usage in the Plant and Pumping Stations. Utilities: This year's utility costs are projected to be $3,565,060 compared to a 2004- 2005 budget of $4,004,850, increasing by $439,790 or 12.3 %. Fiscal year 2003 -2004 expense was less than 2003 -2004 budget due to greater co- generation power usage. Due to regulatory constraints on the amount of electrical power produced by the cogeneration system, it will be less in the 2004 -2005 fiscal year. Utility expense from outside energy suppliers is expected to increase over the next year. Repairs & Maintenance: Repairs and maintenance costs are projected to be $2,862,037 in 2003 -2004 compared to a budget of $2,757,003 in 2004 -2005, for a favorable variance of $105,034 or 3.7 %. Fiscal year 2003 -2004 expense was higher than the 2003 -2004 budget due to unanticipated costs for ballasts and other spare parts for the ultraviolet disinfection system, and the rebuilding of several major treatment plant pumps, and the steam turbines. Hauling & Disposal: Hauling & Disposal costs are projected to be $948,060 in 2003- 2004 compared to $987,060 in the 2004 -2005 Budget resulting in an unfavorable variance of $39,000 or 4.1 %. This is due to increased ash disposal costs for Plant Operations partially offset by elimination of HHW mobile collection events. Professional & Legal: Professional and Legal costs are projected to be $442,500 compared to a 2004 -2005 Budget of $376,995 for a favorable variance of $65,505, or 14.8 %. SAADMIMPOSPAPERMM Budget 05- 04.DOC Page 5 Of 8 POSITION PAPER Board Meeting Date: May 20, 2004 subject RECEIVE THE 2004 -2005 OPERATIONS & MAINTENANCE BUDGET; RECEIVE THE 2004 -2005 DEBT SERVICE FUND BUDGET Outside Services: Outside Services are projected to cost $1,996,334 compared to a 2004 -2005 Budget of $2,050,080, increasing by $53,746 or 2.7 %. Due to cost - cutting measures, 2003 -2004 expense was reduced. Outside services in this year's budget actually decrease when compared to the 2003 -2004 budget due to planned reductions and the need for less temporary help due to filling vacant positions. Materials & Supplies: Materials & Supplies are projected to cost $1,400,937 compared to a 2004 -2005 budget of $1,480,850 for an increase of $79,913 or 5.7 %. Again, 2003- 2004 expenses were lower than the 2003 -2004 budget due to spending cuts. The 2004 -2005 Budget is $147,015 less than the 2003 -2004 Budget due to these reductions. All Other: All other expenses combined increased by $308,412 from projected 2003- 2004 to the 2004 -2005 budget. This increase is due to election expense, which occurs every-other year being budgeted at $200,000, the self- insurance contribution from O &M Budget to the SIF increasing by $25,000, and minor increases spread among the accounts in this category. Any revisions to the 2004 -2005 O &M Budget determined at the May 20, 2004 Board meeting will be incorporated in the Budget submitted for approval at the June 3, 2004 Board Meeting, at which the following actions are scheduled: • Conduct a public hearing to receive comment on the 2004 -2005 O &M Budget, Self- Insurance Fund Budget and Debt Service Fund Budget. • Conduct a public hearing for the collection of the 2004 -2005 Sewer Service Charge on the County Tax Rolls. • Approve the 2004 -2005 O &M Budget, Self- Insurance Fund Budget, and Debt Service Fund Budget, and approve an ordinance, which establishes the 2004- 2005 Sewer Service Charge rate schedule of $280 per residential unit, and establishes an increase of $8 for fiscal year 2005 -2006 and $9 for fiscal year 2006 -2007. RECOMMENDED BOARD ACTION: Review the 2004 -2005 O &M Budget and Debt Service Fund Budget and provide District staff with comments and guidance leading to the approval of the Budgets at the June 3, 2004 Board Meeting. 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CL C W C U C ,r C •a LLpD a C M N N m c. c E Fm L- O C c N N C U 0) W G x ° y C Co O C N o 'C7 a) ai m N N E N C` Q' >+ "a -p 'r O .22? �O' ) C N n C m c n E �pnCp C x p U a) Co O co w > CD w 3 c C M LT L c N O V U p O cNm 3 CL E c cc O o j O a? CL N N C N •C 1 O O co O c N U O O` N c N N co.m c� Na)3(D aci a>i °) c W c o a`) '� N CI) U O N Z Q M Co 2 r N M V O CO v N 0 z 2004 -2005 O &M BUDGET ASSUMPTIONS REVENUE ASSUMPTIONS: Sewer Service Charge - $280 $204 Allocated to O &M $76 Allocated to Sewer Construction Property Tax Revenue Budgeted = $4.2 Million $3.9 Million in Property Tax Revenue Shifted to Debt Service Fund EXPENSE ASSUMPTIONS: Bond Debt Service Expense Shifted to Debt Service Fund S:\ADMIN\RATCLIFF\Budget.Overheads.2004.doc O &M REVENUES, EXPENSES, AND RESERVES FISCAL YEAR 2002 -2003 THROUGH 2004 -2005 (000 Omitted) Revenues: Sewer Service Charge City of Concord Other Total Revenues Expenses: Total Net Expenses Fund Balance - Beginning Of Year Revenues Over Expenses Fund Balance - End Of Year Sewer Service Charge Rate (O &M Portion Only) Total Sewer Service Charge Sewer Service Equivalent S:\ADMIN\RATCLIFF\Budget.Overheads.2004.doc 2002 -2003 Current 2004 -2005 Actual Projected Budget 2003 -2004 $31,965 $34,002 $31,883 6,322 7,100 7,550 3,235 3,568 2,707 41,522 44,670 42,140 38,694 42,923 43,891 6,172 9,000 10,747 2,828 1,747 (1,751) 9,000 10,747 8,996 $207 $218 $204 $248 $272 $280 156,291 OPERATING AND MAINTENANCE 2003 -2004 BUDGET COMPARED TO 2004 -2005 BUDGET (000 Omitted) Revenues Expenses Revenues Over Expenses Fund Balance 06/30/03 S:\ADMIN\RATCLIFF\Budget.Overheads.2004.doc 2003 -2004 Budget $42,986 44,033 1 047 2004 -2005 Budget $42,140 43,891 171 $8,997 Increase (Decrease) (27) (.37) KEY LABOR COSTS (000 Omitted) S:\ ADMIN\ RATCLIFF \Budget.Overheads.2004.doc 2003 -2004 2004 -2005 Increase Budget Budget (Decrease) Salaries & Wages $18,392 $19,426 $1,034 Retirement 5,519 5,535 16 Medical Insurance 3,563 3,725 162 Dental Insurance 664 624 (40) Workers' Compensation 528 525 (3) Vacancy Factor 0 (218) (218) Capitalized Adm. Overhead (1,968) (2,295) (327 ) All Other 1,969 2,036 67 Total Labor Costs 28 667 29 358 91 S:\ ADMIN\ RATCLIFF \Budget.Overheads.2004.doc KEY INCREASES 2003 -2004 BUDGET TO 2004 -2005 BUDGET S:\ADMIN\RATCLIFF\Budget.Overheads.2004.doc Dollar Increase (Decrease) Increase 2003 -2004 Budget $44,033,397 Salaries 1,033,352 5.6 Benefits (342,418) (3.3) Chemicals 15,000 1.4 Utilities 195,050 5.1 Repairs & Maintenance 62,031 2.3 Hauling & Disposal (111,000) (10.1) Professional & Legal 73,995 24.4 Outside Services (85,619) (4.0) Self Insurance 25,000 11.1 Materials & Supplies (147,015) (9.0) Bond Interest Payment (1,101,115) (100) All Other 240,256 19.1 2004 -2005 Budget $43,890,914 (.3%) S:\ADMIN\RATCLIFF\Budget.Overheads.2004.doc DEBT SERVICE FUND 2004 -2005 BUDGET Revenue Debt Service Interest Expense Principal Payments TOTAL Net to be Returned to Sewer Construction Fund S:\ADMIN\RATCLIFF\Budget.Overheads.2004.doc $3,905,000 1,776,000 2,125,000 $3,901,000 $4,000