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HomeMy WebLinkAbout09. Authorize execution of MOU between Central San, CCWD and SCVWD for a preliminary feasibility evaluation of the Refinery Recycled Water Exchange Project Page 1 of 14 Item 9. CENTRAL SAN BOARD OF DIRECTORS ' POSITION PAPER MEETING DATE: MARCH 15, 2018 SUBJECT: CONSIDER AUTHORIZING THE GENERAL MANAGER TO EXECUTEA MEMORANDUM OF UNDERSTANDING (MOU) BETWEEN CENTRAL CONTRA COSTA SANITARY DISTRICT, CONTRA COSTA WATER DISTRICT (CCWD)AND SANTA CLARA VALLEY WATER DISTRICT (SCVWD)FORA PRELIMINARY FEASIBILITY EVALUATION OF THE REFINERY RECYCLED WATER EXCHANGE PROJECT SUBMITTED BY: INITIATING DEPARTMENT: MELODY LABELLA, RESOURCE RECOVERY ENGINEERING AND TECHNICAL SERVICES- PROGRAM MANAGER PDS-RESOURCE RECOVERY REVIEWED BY: JEAN-MARC PETIT, DIRECTOR OF ENGINEERING AND TECHNICAL SERVICES ROGER S. BAILEY, GENERAL MANAGER Roger S. Bailey General Manager ISSUE Board authorization is required for the General Manager to execute a memorandum of understanding. BACKGROUND On Tuesday, November 21, 2017, the General Managers/Chief Executive Officer(CEO) and key staff of Central Contra Costa Sanitary District (Central San), Contra Costa Water District (CCWD) and Santa Clara Valley Water District (SCVWD) met to discuss the Refinery Recycled Water Exchange Project, in which Central San has the potential to provide up to 22,000 acre feet per year of recycled water to CCWD to serve to the Martinez Refineries and the freed up water supply could be exchanged through CCWD to SCVWD. During this meeting, SCVW D's CEO indicated that a letter of support from Central San's and March 15, 2018 Regular Board Meeting Agenda Packet- Page 137 of 275 Page 2 of 14 CCWD's Boards of Directors would be helpful to garner their Board's support for staff spending time to explore this idea. On December 7, 2017, Central San's Board voted unanimously to authorize the Board President to sign the attached letter of support addressed to both CCWD's and SCVWD's Boards of Directors, encouraging these agencies to work together with Central San to evaluate the feasibility of this project concept. On December 19, 2017, SCVW D's Board of Directors indicated their support for their staff to spend time evaluating this potential project. As a result, Central San staff has been working with CCWD's and SCVW D's staff to draft the attached Memorandum of Understanding (MOU)to complete a preliminary feasibility evaluation of the Refinery Recycled Water Exchange Project. The draft MOU calls for each agency to work together to develop a Work Plan within 60 days of execution of the MOU, which covers topics such as: Refinery Recycled Water Quality, Project Yield, Conveyance Options and Constraints, Costs, and Cost Allocation. The draft MOU calls for completion of the preliminary feasibility evaluation within 12 months after development of the Work Plan. Central San will conduct an environmental evaluation of any capital project proposed as a result of this evaluation to determine the need for additional California Environmental Quality Act (CEQA) documentation. ALTERNATIVES/CONSIDERATIONS The Board of Directors may decline authorization of the MOU, which would end Central San's involvement in this project. FINANCIAL IMPACTS The financial impacts are minimal at this time. Authorizing this MOU will commit staff time to assist with development of the Work Plan and evaluate any elements assigned to Central San within the Work Plan. COMMITTEE RECOMMENDATION The Real Estate, Environmental & Planning Committee will review this matter at its March 14, 2018, meeting. Staff will provide an update at the Board meeting. RECOMMENDED BOARD ACTION Authorize the General Manager to execute an MOU between Central San, CCWD and SCVWD fora preliminary feasibility evaluation of the Refinery Recycled Water Exchange Project. Strategic Plan re-In GOAL SIX: Embrace Technology, Innovation and Environmental Sustainability Strategy 1 -Augment the Region's Water Supply ATTACHMENTS: 1. December 7, 2017, Central San Board Letter of Support March 15, 2018 Regular Board Meeting Agenda Packet- Page 138 of 275 Page 3 of 14 2. Draft Central San-CCWD-SCVWD MOU March 15, 2018 Regular Board Meeting Agenda Packet- Page 139 of 275 Page 4 of 14 Jd9k Central Contra Costa Sanitary District Protecting public health and the environment 5019 Imhoff Place,mattinez, CA 94553-4392 PHONE: (925)228-9500 FAX. (925)676-7211 www.centralsan.org December 7, 2017 ROGER S.BAILEY General Manager Contra Costa Water District (CCWD) KENTONL.ALM Attn: Board of Directors c°u e`(°10)8 8`2000 PO Box H2O DONNA ANDERSON Concord, CA 94520 Interim Secretary of the District Santa Clara Valley Water District (SCVWD) Attn: Board of Directors 5750 Almaden Expressway San Jose, CA 95118 Support for Evaluation of the Refinery Recycled Water Exchange Project Dear CCWD and SCVWD Directors: On behalf of the Board of Directors of the Central Contra Costa Sanitary District (Central San), I am writing to express our strong support for our agencies to work together to jointly evaluate the feasibility of the Refinery Recycled Water Exchange Project, which could potentially free up 22,000 acre-feet of new Central Valley Project (CVP) water supply. Central San has the potential to produce and serve recycled water to two nearby oil refineries in Martinez, which currently use more than 22,000 acre-feet per year of CCWD's CVP raw water supply. This additional CVP supply is not needed locally; however, it could potentially be exchanged through CCWD and provided to SCVWD. We hope our agencies can work together to evaluate this innovative recycled water exchange concept, which has the potential to bring added water supply reliability to our region. If you have any questions or need additional information on this concept, please contact Roger S. Bailey, Central San's General Manager, at (925) 229-7300 or rbailey(cb-centralsan.org. Sincerely, ra&�\�" Paul H. Causey Board President cc: Jerry Brown, CCWD General Manager Norma Camacho, SCVWD Chief Executive Officer BOARD OF DIRECTORS PAUL H.CAUSEY,President•JAMES A.NEJEDLY,President Pro Tem•MICHAEL R.McGILL•TAD J PILECKI•DAVID R. WILLIAMS March 15, 2018 Regular Board Meeting Agenda Packet- Page 140 of 275 Page 5 of 14 DRAFT MEMORANDUM OF UNDERSTANDING BETWEEN CENTRAL CONTRA COSTA SANITARY DISTRICT CONTRA COSTA WATER DISTRICT AND SANTA CLARA VALLEY WATER DISTRICT TO CONDUCT A PRELIMINARY FEASIBILITY EVALUATION OF THE REFINERY RECYCLED WATER EXCHANGE PROJECT This Memorandum of Understanding (MOU) is made and entered into on this day of , 2018, by and between Central Contra Costa Sanitary District (Central San), Contra Costa Water District (CCWD) and the Santa Clara Valley Water District (SCVWD), all special districts created by Legislature of the State of California. All three agencies hereinafter may be referred to individually as "Party" or collectively as "Parties." RECITALS 1. WHEREAS, California's and and semiarid climate, its ambitious and evolving economy, and its continually growing population have combined to make water shortages and conflicting demands the norm; and 2. WHEREAS, the Parties recognize that integrated utilization of capacity in existing infrastructure, new interconnections and/or facilities, and water exchanges may provide water supply reliability and/or water quality benefits to multiple agencies and the public and businesses we serve; and 3. WHEREAS, it is a Central San strategic goal to embrace technology, innovation, and environmental sustainability by exploring partnering opportunities to augment the Region's water supply; and 4. WHEREAS, it is the mission of CCWD to strategically provide a reliable supply of high quality water at the lowest cost possible in an environmentally responsible manner, and CCWD is completing the environmental review of the Phase 2 Los Vaqueros Reservoir Expansion Project and several local agencies are participating in the ongoing planning studies; and 5. WHEREAS, it is the mission of SCVWD to provide Silicon Valley safe, clean water for a healthy life, environment, and economy, and SCVWD is currently updating its Water Supply Master Plan, which describes the new water supply investments the District is planning to make to achieve its water supply reliability target, the anticipated schedule of those investments, and the associated costs and benefits of the investments; and Page 1 March 15, 2018 Regular Board Meeting Agenda Packet- Page 141 of 275 Page 6 of 14 DRAFT 6. WHEREAS, CCWD and SCVWD are members of the Bay Area Regional Reliability Partnership, which are working together to develop regional solutions to enhance water supply reliability, leverage existing infrastructure investments, facilitate water transfers during critical shortages, and improve climate change resiliency for the benefit all Bay Area residents; and 7. WHEREAS, the Bay Area Regional Reliability Partnership prepared a Drought Contingency Plan that evaluated several potential drought mitigation measures, including the construction of the Transfer-Bethany Pipeline a key intertie facility included in the Phase 2 Los Vaqueros Reservoir Expansion Project; and 8. WHEREAS, the Parties are interested in conducting a preliminary feasibility evaluation of an innovative water exchange arrangement in which recycled water from Central San could be made available to SCVWD, and where such recycled water, in lieu of raw water, through an exchange arrangement, would be delivered by Central San to CCWD to serve CCWD's existing industrial customers, resulting in the creation of up to 22,000 acre-feet per year of new raw water supply for SCVWD. NOW, THEREFORE, IN CONSIDERATION OF THE FOREGOING AND THE MUTUAL PROMISES HEREINAFTER PROVIDED, THE PARTIES AGREE AS FOLLOWS: 1. TERM a) This MOU shall become effective upon its execution by all Parties. b) This MOU will terminate on June 30, 2019, or when all obligations under this MOU have been performed, whichever occurs first, unless this MOU is terminated pursuant to Article 11, Termination. 2. PURPOSE The purpose of this MOU is to define the roles and responsibilities of each Party and the timing for conducting a Preliminary Feasibility Evaluation of the Refinery Recycled Water Exchange Project. 3. KEY ASSUMPTIONS The key assumptions to be investigated as part of this Preliminary Feasibility Evaluation are: a) In general, the Recycled Water Exchange Project will be considered in a manner that provides a betterment for the customers served by the Parties, and does not result in any unacceptable net adverse impacts to each respective Party. The estimated costs for benefits or impacts will be allocated equitably commensurate with the benefits received. b) CCWD currently serves two oil refineries approximately 22,000 acre-feet per year of raw water, which primarily consists of water received from the Central Page 2 March 15, 2018 Regular Board Meeting Agenda Packet- Page 142 of 275 Page 7 of 14 DRAFT Valley Project (CVP) under CCWD's CVP water supply contract. CCWD is willing to explore changing that water supply to recycled water to facilitate an exchange arrangement with SCVWD provided there are no negative rate impacts and the change in water supply source meets the water quality and quantity requirements for the refineries. c) Central San has available treated wastewater supply that could be recycled through further treatment, and be provided to CCWD to serve the two oil refineries near Central San's wastewater treatment plant. d) SCVWD is interested in exploring how the newly available CCWD CVP water could be transported or exchanged in the most beneficial way to improve its water supply reliability at a cost that the SCVWD Board believes is acceptable to its ratepayers. e) Delta resource impacts such as water quality, Delta outflow, and aquatic species impacts will be explored as part of the environmental review process, if the Refinery Recycled Water Exchange Project moves forward. 4. WORK TO BE PERFORMED The preliminary feasibility evaluation of the Refinery Recycled Water Exchange Project will be completed with in-kind services and cooperative input from the Parties. The Parties will develop a work plan to outline the specific tasks to be completed (Work Plan). Topics to be covered in the Work Plan include: Refinery Recycled Water Quality, Project Yield, Conveyance Options and Constraints, Cost, and Cost Allocation. 5. TIMELINE The Parties will work together to develop the Work Plan within 60 days of execution of this MOU and complete the Preliminary Feasibility Evaluation within 12 months after development of the Work Plan. The work shall be completed by June 30, 2019. 6. REGULATORY APPROVALS, ENVIRONMENTAL APPROVALS, ENVIRONMENTAL COMPLIANCE AND ENVIRONMENTAL REVIEWS The Parties agree that the work contemplated in this MOU is for evaluation purposes only and is, therefore, exempt from the requirements of the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines that exempt projects involving only feasibility or planning studies for future actions which have not been approved, adopted, or funded. If a project resulting from this evaluation moves forward, all appropriate environmental reviews will be conducted at that time. Page 3 March 15, 2018 Regular Board Meeting Agenda Packet- Page 143 of 275 Page 8 of 14 DRAFT 7. RESPONSIBILITIES OF THE PARTIES The Parties shall have unique responsibilities that will be identified in a future Work Plan that will be developed by staff of the respective Parties. General responsibilities of all Parties are as follows: a) Work cooperatively to develop the Work Plan and complete the Preliminary Feasibility Evaluation. b) Commit staff time to work with staff from other Parties. c) Share relevant engineering, permitting, regulatory and operational information regarding its own facilities, studies, and permits with other Parties for the benefit of the evaluation. Notwithstanding, the Parties shall maintain in confidence or will not disclose, display, provide, or make available any documents containing confidential water facility data to any person other than the Parties unless written permission is granted. d) Provide access to facilities and operational data that may be needed for conducting the preliminary feasibility evaluation (such as intakes, conveyance/distribution facilities, treatment plants, interties, etc.). If needed, commit staff time to conduct necessary analysis of its own facilities, permits, operational data, procedures or requirements, or any other data needed for consideration and share the information with other Parties. Access to facilities will be consistent with, and will follow, the facility owner's, security and standard safety and notification requirements. e) Provide appropriate level of oversight and review of any work products. f) Coordinate with the other Parties on all media outreach, media responses, and messaging. 8. IN-KIND SERVICES The Parties agree that in-kind services (i.e. in-house staff resources) will be used to complete this Preliminary Feasibility Evaluation, with each Party covering the cost for its own in-kind staff work. Activities undertaken by either Party in furtherance of this MOU shall be at that Party's sole cost and expense, unless otherwise agreed to in writing by all the Parties 9. INDEMNIFICATION To the extent permitted by State law, each Party will indemnify, defend and hold all other Parties and their directors, officers, agents, and employees safe and harmless from any and all claims, suits, judgments, damages, penalties, costs, expenses, liabilities and losses (including without limitation, sums paid in settlement of claims, actual attorneys' fees, paralegal fees, consultant fees, engineering fees, expert fees and any other professional fees) that arise from or are related in any way to each Party's, its associates' , employees' , Page 4 March 15, 2018 Regular Board Meeting Agenda Packet- Page 144 of 275 Page 9 of 14 DRAFT subconsultants', or other agents' negligent acts, errors or omissions, or willful misconduct, in the performance of this MOU. 10.DISPUTES Any claim that a Party may have against another Party or Parties regarding the performance of this MOU including, but not limited to, claims for compensation will be submitted to the other Parties. Parties will attempt to negotiate a resolution of such claim and if necessary process an amendment to this MOU or enter into a settlement agreement to implement the terms of any such resolution. 11.TERMINATION If an individual Party elects to terminate its participation in this MOU, it may do so by delivering to each remaining Party a written notice of intention to terminate. Termination shall take effect five days following the receipt of notice by the other Parties. 12.MAINTENANCE AND INSPECTION OF BOOKS, RECORDS, AND REPORTS All Parties will, upon reasonable advance written notice, make available for inspection to the other Parties all records, books and other documents directly relating to the Work Plan as well as any other work related to water supply institutional arrangements and Agreements that are required for conducting the preliminary feasibility evaluation. Prior to release of information other than in response to a Public Records Act request, a subpoena, or court order, all draft information has to be approved by all Parties for finalization and release. 13.MOU NOT A PRECEDENT The Parties intend that the provisions of this MOU will not bind the Parties as to the provisions of any future MOU or agreement between them. 14. NOTICES Any notice, demand, or request made in connection with this MOU must be in writing and will be deemed properly served if delivered in person or sent by United States mail, postage prepaid, to the addresses specified below: If to Central San: Roger S. Bailey General Manager Central Contra Costa Sanitary District 5019 Imhoff Place Martinez, CA 94553 Page 5 March 15, 2018 Regular Board Meeting Agenda Packet- Page 145 of 275 Page 10 of 14 DRAFT If to CCWD: Jerry Brown General Manager Contra Costa Water District PO Box H2O Concord, CA 94524 If to SCVWD: Norma J. Camacho Chief Executive Officer Santa Clara Valley Water District 5750 Almaden Expressway San Jose, CA 95118 15.NO THIRD-PARTY BENEFICIARIES No third-party beneficiaries are intended or created by this MOU. 16.SEVERABILITY If any term or provision of this MOU is deemed invalid or unenforceable by a court of competent jurisdiction or by operation of any applicable law, it will not affect the validity of any other provision, which will remain in full force and effect. 17.COMPLETE MOU Other than as specified herein, no document or communication passing between the Parties to this MOU will be deemed to be part of this MOU. 18.ASSIGNMENT This MOU is not assignable either in whole or in part, except upon mutual written consent of the Parties. 19.AMENDMENT AND WAIVER Except as provided herein, no alteration, amendment, variation, or waiver of the terms of this MOU shall be valid unless made in writing and signed by all Parties. Waiver by any Party of the default, breach or condition precedent, shall not be constructed as a waiver of any other default, breach or condition precedent, or any right hereunder. Page 6 March 15, 2018 Regular Board Meeting Agenda Packet- Page 146 of 275 Page 11 of 14 DRAFT 20.SUCCESSORS This MOU shall bind the successors of the Parties in the same manner as if they were expressly named. 21.INTERPRETATION This MOU shall be deemed to have been prepared equally by all Parties, and its individual provisions shall not be construed or interpreted more favorably for one Party on the basis that the other Parties prepared it. 22.INTEGRATION This MOU represents the entire understanding of the Parties as those matters contained herein. No prior oral or written understanding shall be of any force or effect with respect to those matters covered hereunder. 23.WAIVER The waiver at any time by any Party of its right with respect to default or other matter arising in connection with this MOU will not be deemed a waiver by that Party with respect to any subsequent default or matter. 24.GOVERNING LAW This MOU is governed by and will be interpreted in accordance with the laws of the State of California. 25.COUNTERPARTS This MOU may be executed in counterpart. Facsimile and electronic signatures shall be binding. Page 7 March 15, 2018 Regular Board Meeting Agenda Packet- Page 147 of 275 Page 12 of 14 DRAFT This MOU will be effective as of the last date signed below. CENTRAL CONTRA COSTA SANITARY DISTRICT Roger S. Bailey Katie Young General Manager Secretary of the District Date Approved as to form: Kenton L. Alm District Counsel Page 8 March 15, 2018 Regular Board Meeting Agenda Packet- Page 148 of 275 Page 13 of 14 DRAFT CONTRA COSTA WATER DISTRICT Jerry Brown Mary A. Neher General Manager District Secretary Date Approved as to form: Doug Coty District Legal Counsel Page 9 March 15, 2018 Regular Board Meeting Agenda Packet- Page 149 of 275 Page 14 of 14 DRAFT SANTA CLARA VALLEY WATER DISTRICT Norma J. Camacho Chief Executive Officer Date Approved as to form: Anthony T. Fulcher Senior Assistant District Counsel Page 10 March 15, 2018 Regular Board Meeting Agenda Packet- Page 150 of 275